Equity Bancshares, Inc. · NYSE:EQBK
Equity Bancshares — Merger or Acquisition (December 2017)
36 slides from Equity Bancshares's merger presentation, Dec 18, 2017
Slide 1: Mergers with First National Bank of Liberal and Adams Dairy Bank
Mergers with First National Bank of Liberal and Adams Dairy Bank December 18, 2017 NASDAQ: EQBK Exhibit 99.2
Slide 2: Forward-Looking Statements
This presentation contains “forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements reflect the current views of Equity’s management with respect to, a
Slide 3: Additional Information for Investors and Shareholders
Additional Information for Investors and Shareholders Important Additional Information This communication shall not constitute an offer to sell, a solicitation of an offer to sell, or the solicitation or an offer to buy any securities. Investors and security holders are urged to carefully review and
Slide 4: Equity Bancshares, Inc. – About Us
As of 12/15/17 market closing Per FactSet Research Systems, as of 12/15/17 Tangible book value per share as reported at 9/30/17 Includes shares issued in connection with EQBK’s November 2017 acquisitions of Eastman National Bancshares, Inc. and Cache Holdings, Inc. Equity Bancshares, Inc. – About Us
Slide 5: Equity Bancshares, Inc. – Company Profile
EQBK (Nasdaq ticker) $3.0 Billion Total Assets (1) $513 Million Market Cap (2) (as of 12/15/17) Deposit franchise: Kansas (18 branches with $934mm in deposits)(3) Missouri (14 branches with $547mm in deposits)(3) Arkansas (5 branches with $350mm in deposits)(3) Oklahoma (5 branches with $510mm in de
Slide 6: Equity Bancshares investment highlights
Performance Growth in Commercial Banking Franchise Commercial banking customers (70% of loans) Three metro markets and four-state presence Manufacturing, transportation, business Strong Operating Performance Delivered earnings and EPS growth Above peer asset quality through cycles Leveraging infrast
Slide 7: Pro Forma Footprint & Demographics
Unemployment Rates(1) Kansas: 3.0% Missouri: 2.5% Arkansas: 3.2% Oklahoma: 4.1% USA: 3.9% Footprint 48 branches in 25 counties across 4 states Strong strategic positioning, with branches along I-70 and I-35 Branches clustered around key areas such as Wichita, Topeka, Kansas City, Tulsa, South/West K
Slide 8: Merger with First National Bank of Liberal/Hugoton (Kansas Bank Corporation)
Merger with First National Bank of Liberal/Hugoton (Kansas Bank Corporation)
Slide 9: First National Bank of Liberal - Overview
FNB Footprint Selected Financial Highlights (1) Overview First National Bank of Liberal is headquartered in Liberal, KS Founded in 1900 and operates four branches in Liberal with an additional branch in Hugoton, KS Attractive core deposits in stable markets Expansion of Western Kansas footprint High
Slide 10: Southwest Kansas Market Presence
Southwest Kansas Market Presence Logical market expansion West of Wichita home office and South of 2017 Western Kansas expansion EQBK gains entry into southwest Kansas Meaningful addition to Kansas footprint of 18 current bank offices 64 basis point cost of deposits including 70% signature deposits
Slide 11: FNB of Liberal – Liberal, Kansas Market
FNB of Liberal is headquartered in Liberal and operates within Seward County and Stevens County FNB of Liberal market share rank: #1 (57%) Seward County has a median household income of $51,377, with 46% of households with income of greater than $50,000 and 5% greater than $150,000. Retail distribut
Slide 12: Transaction Overview: Structure
Structure EQBK to acquire 100% of Kansas Bank Corporation First National Bank of Liberal is expected to be merged into Equity Bank in Q2 2018 Purchase Price Deal value: Approximately $45.1 million(1) Consideration: 820,904 shares of EQBK Class A common stock and $16.8 million in cash (~ 63% stock /
Slide 13: Financially Attractive; Compelling Strategic Partnership
Financially Attractive Structured within EQBK’s merger metrics and discipline $0.06 EPS Accretive in 2018 and $0.10 EPS Accretive in 2019 1.8% dilutive to tangible book value with a TBV earnback of 2.8 years using the crossover method 16%+ IRR Low-Risk Profile Similar customer approach, credit cultu
Slide 14: Key Transaction Assumptions
Cost Savings Expected annual non-interest expense savings of approximately 23%, or approximately $1.1 million, with 100% being achieved during 2018 Revenue Enhancements Identified, but none included in pro forma projections One-time Merger Related Costs Approximately $6.1 million pre-tax Loan Credit
Slide 15: Merger with Adams Dairy Bank (Adams Dairy Bancshares, Inc.)
Merger with Adams Dairy Bank (Adams Dairy Bancshares, Inc.)
Slide 16: Adams Dairy Bank - Overview
Adams Footprint Selected Financial Highlights (1) Overview Adams Dairy Bank is headquartered in Blue Springs, Mo. Operates one branch in the Kansas City MSA Adjacent to existing Equity KC footprint Strong profitability, ROAA and ROAE Attractive expansion of a growing and dynamic metro market High-ca
Slide 17: KC Market Presence
KC Market Presence Logical market expansion Blue Springs adjacent northeast of Lee’s Summit, Mo. EQBK gains additional market within KC MSA Meaningful market entry via a rapidly expanding franchise Attractive core deposit base Blue Springs, MO EQBK Adams Dairy Bank (1) Adams Dairy Bank – Deposit Mar
Slide 18: Adams Dairy Bank – Kansas City Market
Adams Dairy Bank – Kansas City Market Jackson County, Mo. And Blue Springs, Mo. Blue Springs, Missouri, with population of 54,431, is No. 8 Kansas City MSA suburb ranked by population, with Mass Middle Class consumer profile as largest segment. Adams Dairy deposit market share rank in Blue Springs,
Slide 19: Transaction Overview: Structure
Structure EQBK to acquire 100% of Adams Dairy Bancshares, Inc. Continues EQBK strategy of community bank consolidation Adams Dairy Bank is expected to be merged into Equity Bank in Q2 2018 Purchase Price Deal value: Approximately 15.8 million(1) Exchange Ratio: 0.4791 EQBK shares and $5.51 in cash C
Slide 20: Financially Attractive; Compelling Strategic Partnership
Financially Attractive Structured within EQBK’s merger metrics and discipline $0.03 EPS Accretive in 2018 and $0.05 EPS Accretive in 2019 0.5% dilutive to tangible book value with a TBV earnback period of 2.7 years using the crossover method 17%+ IRR Low-Risk Profile Similar customer approach, credi
Slide 21: Key Transaction Assumptions
Cost Savings Expected pre-tax non-interest expense savings of approximately 32%, or approximately $0.7 million in 2018 and $1.0 million in 2019, with 100% being achieved in 2018 Revenue Enhancements None included in pro forma projections One-time Merger Related Costs Approximately $2.8 million pre-t
Slide 22: Combined Summary
Combined Summary Impact = EQUITY BANCSHARES, INC. ADAMS DAIRY First National Bank BANK” Liberal/Hugoton Bank Local.
Slide 23: Pro Forma Footprint
Pro Forma Footprint EQBK (42) First National Bank of Liberal (5) Adams Dairy Bank (1)
Slide 24: Pro Forma Financial Impact
EPS Impact ~4% accretive in 2018 ($0.09) ~5% accretive in 2019 ($0.14) Tangible Book Value Impact ~2.5% dilutive to tangible book value at close Tangible book value earn-back period estimated to be approximately 2.7 years, using the cross-over method Pro Forma Consolidated Capital ~8.2% Tangible Com
Slide 25: Pro Forma Loan & Deposit Composition
EQBK Stand Alone FNB of Liberal Stand Alone Adams Dairy Stand Alone Pro Forma Loan Mix Deposit Mix Total: $2,037 million Total: $170 million Total: $91 million Total: $2,297 million Total: $2,366 million Total: $274 million Total: $102 million Total: $2,743 million Yield on Loans: 5.40% Yield on Loa
Slide 26: Benefits to the Combined Shareholders
Shareholders Strategically and financially attractive transactions Successful Board and Management teams with strong community ties Improved liquidity for FNB Liberal and Adams Dairy shareholders Opportunity for increased shareholder value for all companies Customers Community banking model with a f
Slide 27: Summary
FNB Liberal and Adams Dairy Bank join franchise allowing for continued growth and development of products and services in community markets and metropolitan markets Second consecutive dual-track merger, demonstrating discipline and commitment to execution in diverse range of markets Strategic acquis
Slide 28: Supplemental Information
Supplemental Information
Slide 29: Equity Bancshares history and M&A timeline
2013 Integrate FCB and double earnings. CFO and CRO roles filled. 2016 Community First (CFBI) merger Note: Yellow shading indicates M&A activity; gray shading indicates capital activity * Data as of 12/31/2007. ** Data as of 12/31/2011. *** Data as of 3/31/2018, pro forma for KBC and Adams transacti
Slide 30: FNB of Liberal – Financial Highlights
FNB of Liberal – Financial Highlights Source: SNL Financial Note: Bank level data used
Slide 31: Adams Dairy Bank – Financial Highlights
Source: SNL Financial Note: Bank level data used Note: Income metrics are not adjusted for S-Corp status Adams Dairy Bank – Financial Highlights
Slide 32: EQBK – Financial Highlights
EQBK – Financial Highlights Source: SNL Financial and FactSet`
Slide 33: Board of Directors and Advisors
Gary Allerheiligen Accounting CPA Advisor, Retired Partner, Grant Thornton (KS) Jim Berglund Banking Bank Advisor, Retired President / CEO Sunflower Bank (KS) Dan Bowers Former Secretary & Vice Chairman of Community First Bancshares, Inc. Michael Downing Former Ellis State Bank President (KS) Brad E
Slide 34: Experienced Management Team
BRAD ELLIOTT Chairman & CEO Founded Equity Bank in 2002 Served as Regional President of Sunflower Bank prior to forming Equity Bank More than 25 years of banking experience GREG KOSSOVER Chief Financial Officer Has served as CFO since 2013 and as a Board Director since 2011 Previously served as pres
Slide 35: Strategic Planning Team
Team Member Role Years with EQBK Years in Banking Patrick Harbert EVP, Community Markets, Sales & Service 13 22 Julie Huber EVP, Strategic Initiatives 13 23 Jennifer Johnson EVP, Chief Operations Officer 5 31 Rolando Mayans EVP, Chief Risk Officer 9 24 Beth Money EVP, Retail Banking Director 8 27 Sc
Slide 36: Footprint & Targets
Footprint & Targets gee tthe, eo 8 @ Bank Offices, $50mm - $300mm (393) © Bank Offices, $300mm - $750mm (133) © Bank Offices, $750mm and up (93) A. Equity Bank Locations (42) ys rs nites aes fi. + 5 “. ARKANSAS’ > *. sas sous 8
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