Unity Bancorp, Inc. · NASDAQ:UNTY
Unity Bancorp — Investor Presentation (February 2017)
26 slides from Unity Bancorp's investor presentation, Feb 2, 2017
Slide 1: Unity Bancorp, Inc. NASDAQ: UNTY
W Unity BANCORP INC 12/31/16 NASDAQ: UNTY
Slide 2: Forward-Looking Statements
» Forward-Looking Statements This presentation may contain forward-looking statements with respect to Unity Bancorp’s financial condition, results of operations and business. Do not unduly rely on forward-looking statements. Forward- looking statements can be identified by the use of words such as “
Slide 3: Company Snapshot
Company Snapshot « Founded September 16, 1991 « Headquartered in Clinton, New Jersey « Approximately $1.2 billion in assets and $946 million in deposits « Unity Bank provides financial services to retail, corporate and small business customers through its 17 retail service offices located in Bergen,
Slide 4: Bank Franchise
Bank Franchise Bergen County, NJ: Emerson (Opened in October) Somerset County, NJ: North Plainfield, Somerset, Hunterdon County, NJ: Clinton, Flemington, Whitehouse Somervile: (OpencdaniNovembes) Middlesex County, NJ: Edison, Highland Park Middlesex, South * Union County, NJ: Linden, Scotch Plains,
Slide 5: High household income in our market counties relative to the State of New Jersey
High household income in our market counties relative to the State of New Jersey and the nationwide medians State of New Jersey ranks 2"! in the nation in median household income, 4**in per capita income, and 2" in population density With respect to median household income, Hunterdon County and Some
Slide 6: Strategic Goals
Strategic Goals « To grow our business relationships by being a responsive bank, providing excellent service with flexible terms and conditions— 10% loan growth « Mortgage Division — 15% growth rate in purchased transactions « SBA Division — Increase 7A Volume no less than $40 million « Growth in co
Slide 7: Senior Management
Senior Mar James A. Hughes, CPA Alan J. Bedner, Jr. CPA emen m + President and Chief Executive Officer + Chief Financial Officer + Joined the company in 2000 + Joined the company in 2001 + 30 years banking experience * 21 years banking experience + Previously employed at Summit Bancorp + Previously
Slide 8: Engaged Board of Directors
Engaged Board of Directors ¢ David Dallas, Chairman of the Board, and Robert Dallas, Board Member, both founding members of the Bank @ Average tenure of Board Members is 15 years @ Diverse experience including financial industry, medical professionals, university professional and business ownership
Slide 9: Recent Financial Performance
Recent Financial Performance an
Slide 10: Summary Balance Sheet
Summary Balance Sheet (dollars in millions) Assets $ 1,008.8 |$ 1,084.9 |$ 1,189.9 Total Loans 761.8 889.0 973.4 Deposits 794.3 894.5 945.7 Total Equity 9.9 78.5 106.3
Slide 11: Loan Mix
Loan Mix (dollars in millions) $1,200.00 $1,000.00 $973.4 S915 $800.00 $761.8 $678.7 [sso] $587.1 $600.00 $400.00 $200.00 s- 2012¥ 2013Y 2014Y 2015Y 2016Y wCommercial Loans mMortgageLoans GSBALoans Consumer Loans
Slide 12: Mortgage Loan Originations
Mortgage Loan Originations (dollars in millions) Mortgage Growth $200.00 S192 $180.00 $180.9 $160.00 $153.4 $133.6 $140.00 $: $120.00 $100.00 $80.00 2012Y 2013Y 2014Y 2015Y 2016Y wPurchases mRefinances an u
Slide 13: Asset Quality Continues to Improve
1.40% 1.20% 1.00% 0.80% 0.60% 0.40% 0.20% 0.00% Asset Quality Continues to Improve 1.16% 0.87% O.80%6 0.76% 074% 4Q2015 1Q2016 2Q2016 3Q2016 4Q2016 wNonperforming Loans @TDRs 2
Slide 14: Year Deposit Trend
5 Year Deposit Trend (dollars in millions) $1,000.00 aes $945.7 $900.00 $794.3 $800.00 $738 $700.00 $ $600.00 $300.00 $400.00 $300.00 $200.00 $100.00 $ 2012Y 2013Y 2014Y 2015Y 2016Y lnterest-bearing DDA & SAV deposits mTotal time deposits ms Noninterest-bearing demand deposits
Slide 15: Summary Income Statement and Profitability
Summary Income Statement and Profitability (dollars in millions) 2016 iNet Interest Income $ 340 |s 38.3 [Provision for Loan Losses os 12 Noninterest Income WI ii* INoninterest Expense 26.9 27.6 [Provision for Income Taxes 48 73 [Net Income $ 9.6 _|s 13.2 [Diluted Earnings Per Share $ 1.02 |s 138 Re
Slide 16: Net Interest Income & Net Interest Margin
Net Interest Income & Net Interest Margin (dollars in millions) 3.62% 3.63% 3.58% 2012Y 2013Y 2014Y 2015Y ama Net Interest Income =@eNet Interest Margin 2016Y 4.00% 3.50% 3.00% 2.50% 2.00% 1.50% 1.00% 15
Slide 17: Strong Levels of Noninterest Income
Strong Levels of Noninterest Income (dollars in millions) joninterest Income (excludes gains [losses] on securities) $10.00 19.22% 20.00% 18.46% $9.00 18.00% $8.00 $7.00 16.00% 360 14.00% $5.00 ort 12.00% $3.00 10.00% $2.00 8.00% $1.00 s- 6.00% 2012Y 2013Y 2014Y 2015Y 2016Y GBNoninterest Income = No
Slide 18: Noninterest Income
Noninterest Income (dollars in thousands) Branch fee income $ 1,520|s 1,269 Service and loan fee income 1,996 2,030 Gain on sale of SBA loans held for sale, net 1,204 2,099} Gain on sale of mortgage loans, net 1,674 1,610 BOLI income 380] 378 Net security gains 28 424 Net gain on repurchase of subor
Slide 19: Noninterest Expense Controls
$35.00 $30.00 $25.00 $20.00 $15.00 $10.00 Noninterest Expense Controls (dollars in millions) Noninterest 3.02% 2012Y 2013Y 2014Y 2015Y 2016Y a smmaNoninterest Expense -f+Noninterest Expense/Average Assets 2.00% 0.00% 18
Slide 20: Noninterest Expense
Noninterest Expense (dollars in thousands) 201 2016 Compensation and benefits s 14.295/S 14,952 Occupancy 2,515] 2360 Processing and communications 2,461 2,445] Furniture and equipment 1,643 1,700 Professional services 942 976 Loan and OREO costs 1141 989 Deposit insurance 669 713 Advertising 1,030
Slide 21: Profitability Progression
Profitability Progression are $138 all $0.60 $0.40 $0.20 ia “ | 2011Y 2012Y 2013Y 2014¥ 2015Y All share information has been adjusted for the 10% stock dividend paid September 30, 2016. 2016Y (© Effect of nonrecurring gain on repurchase of subordinated debenture
Slide 22: Tangible Book Value Per Share
$10.50 $10.00 $9.50 $9.00 $8.50 $8.00 $7.50 $7.00 $6.50 $6.00 Tangible Book Value Per Share (Non-GAAP) $10.00 Pa aoill $0.40" 2012Y 2013Y 2014Y 2015Y Note: 2013 reflects redemption of TARP preferred stock and the associated warrant 2016Y All share information has been adjusted for the 10% stack divi
Slide 23: Market Price
$17.00 $15.00 $13.00 $11.00 $9.00 $7.00 $5.00 $3.00 Market Price 2012Y 2013Y 2014Y 2015Y 12/31/2016 Note: All share information has been adjusted for the 10% stock dividend paid September 30, 2016.
Slide 24: Capital Ratios
Capital Ratios 2016Y Leverage 12.00% [unity Bancorp, inc. zo GM Fpic-insured Commercial 10.009 Banks 8.00% Total 1 Risk-Based Capital 16.00% 6.00% 4.00% 12.00% 2012Y 2013Y 2014Y 2015Y Total Risk-Based Capital 8.00% 18.00% 15.00% 4.00% 12.00% 2012Y 2013Y 2014Y 2015Y 2016Y 9.00% 6.00% 3.00% 2012¥ 2013
Slide 25: Compelling Investment Highlights
Compelling Investment Highlights Knowledgeable and experienced management team of Attractive branch franchise 24
Slide 26: Data sources
The previous slides contained data from the following sources: FDIC-Insured Commercial Banks: Obtained from FDIC. gov Quarterly Banking Profile SNL
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