Fidelity D & D Bancorp, Inc. · NASDAQ:FDBC
Fidelity D & D Bancorp — Merger or Acquisition (December 2019)
13 slides from Fidelity D & D Bancorp's merger presentation, Dec 10, 2019
Slide 1: Proposed Acquisition of MNB Corporation
Fidelity D & D Bancorp, Inc. Proposed Acquisition of MNB Corporation
Slide 2: Forward Looking Statement
Forward Looking Statement This presentation contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act, relating to present or future trends or factors affecting the banking industry and, specifically, the financial operations, markets and products of Fi
Slide 3: Table of Contents
Table of Contents Transaction Summary Transaction Overview Overview of Pro Forma Franchise Transaction Terms Transaction Rationale Deposit Market Share Deposit Mix Loan Mix Expected Financial Impact 10. Summary OONAURWNE
Slide 4: Transaction Summary
Transaction Summary QAcquirer: OAcquiree: OiTransaction Value: OConsideration: QIEst’d One-Time Charges: Fidelity D & D Bancorp, Inc. (NASAQ: FDBC) MNB Corporation (OTC Pink MNBC) $78.5 million 100% stock $2.8 million
Slide 5: Transaction Overview
Transaction Overview * Fidelity D & D Bancorp, Inc. (FDBC) proposes to purchase 100% of the outstanding stock of MNB Corporation (MNBC) * MNBC will merge into FDBC; Merchants Bank of Bangor will merge into Fidelity Deposit and Discount Bank * Merchants shareholders will receive 1.039 shares of FDBC
Slide 6: Overview of Pro Forma Franchise
Overview of Pro Forma Franchise Attractive combination of strong local franchises Provides significant expansion opportunities in “me demographically attractive markets Harnisbura Pro Forma Highlights Total Assets: $1.46B Gross Loans: $0.99B Total Deposits: $1.21B ee Branches: oe dltom, 2t oe ad Phi
Slide 7: Transaction Terms
Transaction Terms Buyer Seller Stock consideration Consideration mix Indicative price per share Market premium Implied aggregate transaction value Implied price/TBV Implied price/LTM operating EPS MNBC Board representation Required approvals Expected closing Fidelity D & D Bancorp, Inc. (NASDAQ: FDB
Slide 8: Transaction Rationale
Transaction Rationale Strategic Rationale Financial Attributes Risk Experienced management team with deep ties to the local community Extends franchise into markets with stronger demographics Low risk, mature franchise with long-term relationships Both organizations enjoy excellent credit quality In
Slide 9: Deposit Market Share
Deposit Market Share Northampton County As of June 30, 2019 Branch Deposits Market Institution Name HQ State Count in County Share Rank BB&T Corp. NC 15 1,179,030 19.0% 1 Wells Fargo & Co. CA 13 1,074,815 17.4% 2 Fulton Financial Corp. PA 12 837,976 13.5% 3 PNC Financial Services Group PA 11 663,198
Slide 10: Deposit Mix at 9/30/19
Deposit Mix at 9/30/19 FDBC CDs > $100,000. cps < $100,000 8% 0% Savings 12% Although MNBC has a lower portion of non-interest bearing accounts, its 3Q19 cost of funds was 0.39% versus 0.91% for FDBC Mina 20% Non-inte) Bearin 28% Interest Bearing, 22% Demand MNBC (cbs > $100,000 cps< $100,000 5% 6 9
Slide 11: Loan Portfolio Mix at 9/30/19
Loan Portfolio Mix at 9/30/19 FDBC commerciale. MNBC hesiential real industrial stone equity cotate 12% ‘consumer 22% Home equity &—_ 28% Residential real estate 37% consumer 6% Construction & development 6% Commercial & industrial 16% Construs Commericial commerici development reer real estate 2% 3
Slide 12: Expected Financial Impact
Expected Financial Impact Assumptions/Current Estimates Financial Impact 2.7% loan mark, inclusive of interest rate mark 1.3% core deposit intangible mark, 10 year amortization, sum-of-the-years digits Other purchase accounting marks are not material 30% in cost saves, virtually all realized before
Slide 13: Summary
Summary * Creates significant franchise value * Material cost savings * Pro forma assets of $1.5 billion * Higher lending limit and enhanced products and services * Compatible community banking cultures ¢ Financially attractive combination
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