Unity Bancorp, Inc. · NASDAQ:UNTY
Unity Bancorp — Shareholder Meeting (April 2007)
28 slides from Unity Bancorp's shareholder meeting presentation, Apr 26, 2007
Slide 1: 2007 Shareholders' Meeting
2007 Shareholders’ Meeting
Slide 2: Performance Ratios
Performance Ratios 2005 2006 Net Income 6,210 $ 5,845 $ Earnings Per Diluted Share 0.92 $ 0.85 $ Return on Assets 1.10% 0.90% Return on Common Equity 16.29% 13.56% Efficiency Ratio 61.53% 67.21%
Slide 3: Prime Rate
1.00% 2.25% 4.25% 5.25% 5.25% 8.25% 8.25% 7.25% 5.25% 4.00% 3.00% 4.00% 5.00% 6.00% 7.00% 8.00% 9.00% 12/31/03 12/31/04 12/31/05 12/31/06 3/31/07 Prime Rate Prime Rate
Slide 4: Treasury Yield Curve
2.00% 3.00% 4.00% 5.00% 6.00% 3 Mth 6 Mth 2Yr 3Yr 5Yr 10Yr 30 Yr 12/31/2004 12/31/2005 12/31/2006 Treasury Yield Curve
Slide 5: Rate Environment
Rate Environment Net Interest Margin 3.87% in 2006 vs. 4.17% in 2005 Interest Income grew 27% Interest Expense grew 64% Net Interest Income grew 7% Higher Rates – Lower loan demand Higher Rates – Credit quality on variable rate loans Industry is evolving – Fee income is critical
Slide 6: Performance Ratios, cont.
Performance Ratios, cont. Q1 Q2 Q3 Q4 Q1 3/31/06 6/30/06 9/30/06 12/31/06 3/31/07 Net Income 1,657 $ 1,637 $ 1,627 $ 924 $ 1,451 $ Earnings Per Diluted Share 0.24 $ 0.24 $ 0.23 $ 0.13 $ 0.21 $ Return on Assets 1.08% 1.03% 1.00% 0.55% 0.87% Return on Common Equity 16.26% 15.39% 15.26% 8.05% 12.74% Ef
Slide 7: Experienced Management Team
Name Title Years Banking Experience Jim Hughes, CPA President and CEO 25 Alan Bedner, CPA Executive VP, CFO 13 Mike Downes Executive VP, CLO 21 John Kauchak Executive VP, CDO 26 Marc Sovelove Senior VP/Retail Lending 22 Keith Fenstermaker Senior VP/Credit Administration 30 Janice Bolomey Senior VP/B
Slide 8: Strategic Objectives
Consistently outperform our peers Focus on Deposit & Loan Growth / Margin Management Remote deposit capture/Merchant Capture Continue to be a leader in SBA lending National SBA program Grow Retail Lending Division DeNovo growth strategy - 1 to 3 branches per year Focus on Fee income Effective Capita
Slide 9: Unity Footprint: Branch Locations
Branch Locations 1 Clinton 2 Bridgewater 3 Colonia 4 Edison 5 Flemington 6 Highland Park 7 Linden 8 North Plainfield 9 Phillipsburg 10 Scotch Plains 11 South Plainfield 12 Springfield 13 Union 14 Whitehouse 15 Forks Twp, PA In Development 16 Middlesex 17 Washington Unity Footprint
Slide 10: Demographic Data
Demographic Data 2000-2011 Projected Average Population Household Total County Growth % Income (2006) Housholds Union, NJ 1.70 94 188 Middlesex, NJ 5.52 95 278 Somerset, NJ 6.69 140 118 Hunderdon, NJ 6.62 138 48 Warren, NJ 6.50 84 42 Northampton, PA 8.45 70 111
Slide 11: Financial Presentation
BANCORP*INC Financial Presentation
Slide 12: Income Statement
Income Statement In thousands % 2005 2006 Change Interest Income 33,837 $ 43,177 $ 27.6% Interest Expense 11,603 19,432 67.5% Net Interest Income 22,234 23,745 6.8% Provision for loan losses 1,850 1,550 -16.2% Non-interest income 8,190 7,638 -6.7% Non-interest expense 18,676 21,045 12.7% Net income
Slide 13: Total Assets
Total Assets In millions $433 $467 $515 $614 $694 $250 $300 $350 $400 $450 $500 $550 $600 $650 $700 12/02 12/03 12/04 12/05 12/06
Slide 14: Total Loans
Total Loans In millions $312 $340 $374 $449 $508 $250 $300 $350 $400 $450 $500 12/02 12/03 12/04 12/05 12/06
Slide 15: Loans by Type
Loans by Type 12/31/05 12/31/06 6.73 5.51 7.43 10.24 Rate 5.79 5.34 7.03 8.82 Rate % Loan Type % Loan Type Consumer Res Mortgage Commercial SBA Consumer Res Mortgage Commercial SBA 12.5% 13.8% 10.4% 10.6% 61.5% 58.1% 15.6% 17.5%
Slide 16: Asset Quality
Asset Quality 2004 2005 2006 Nonperforming assets 4,436 4,539 9,120 SBA Guarantee 1,240 758 2,953 Net Nonperforming assets 3,196 3,781 6,167 NPL/Total Loans 1.10% 0.97% 1.75% ALLL/Total Loans 1.57% 1.54% 1.50% Net Charge-Off Ratio 0.19% 0.20% 0.17%
Slide 17: Net Interest Margin
7.25% 2005 8.25% 5.25% 4.00% 4.25% Prime Rate 2006 2004 2003 2002 3.87% 4.17% 4.18% 4.28% 4.09% 3.55% 3.75% 3.72% 3.68% 3.83% 2.75% 3.25% 3.75% 4.25% 2002 2003 2004 2005 2006 Margin Peer Margin Net Interest Margin
Slide 18: Total Deposits
Total Deposits In millions $383 $415 $434 $522 $566 $250 $300 $350 $400 $450 $500 $550 $600 12/02 12/03 12/04 12/05 12/06
Slide 19: Deposit Mix
Deposit Mix 12/31/05 12/31/06 4.19 3.78 2.25 Rate 3.23 2.42 1.73 Rate % Deposit Type % Deposit Type Time Saving Int. Bearing DDA DDA Time Savings Int. Bearing DDA DDA 36.4% 27.2% 31.0% 30.9% 18.6% 26.7% 14.1% 15.2%
Slide 20: Shareholders' Equity Book Value
Shareholders’ Equity Book Value In millions Shareholders Equity $27.1 $30.8 $40.9 $46.2 $35.9 $0.0 $5.0 $10.0 $15.0 $20.0 $25.0 $30.0 $35.0 $40.0 $45.0 $50.0 12/02 12/03 12/04 12/05 12/06
Slide 21: Capital Ratios
14.00% 12.32% 12.53% 12.39% 11.23% 13.60% 12.00% 10.00% 11.05% 11.28% 11.14% 9.98% 10.80% 8.00% 8.38% 9.02% 9.09% 8.27% 9.08% 6.00% 4.00% 12/02 12/03 12/04 12/05 12/06. Leverage Tier I Total Capital Capital Ratios
Slide 22: Key Investment Appeals
BANCORP*INC Key Investment Appeals
Slide 23: Ratios vs. Peer Data
Peer data includes 20 Public Commercial Banks in New Jersey between $250 million and $3.5 billion. Data as of or for the period ending December 31, 2006. Pricing Data as of March 31, 2007. Year ended December 31, 2006 Unity Peer Avg* Performance Ratios (%): 0.90 0.74 13.56 7.84 3.87 3.55 67.21 63.99
Slide 24: Cash Dividends Declared
$0.05 $0.14 $0.18 $0.20 $0.05 $0.05 $0.00 $0.05 $0.10 $0.15 $0.20 12/03 12/04 12/05 12/06 1Q 06 1Q 07 Cash Dividends Declared
Slide 25: Key Investment Appeals
Top Quartile Performance Ratios Focus on Deposit and Loan Growth Leader in SBA Lending Insider Ownership Attractive Valuation Expansion Strategy Growing Market Share in Attractive Markets Key Investment Appeals
Slide 26: History of 5% Stock Dividends
Announced Record Date Paid 4/26/2007 6/15/2007 6/29/2007 4/27/2006 6/16/2006 6/30/2006 5/26/2005 6/15/2005 6/30/2005 5/27/2004 6/15/2004 6/30/2004 1/27/2003 2/26/2003 3/12/2003 History of 5% Stock Dividends
Slide 27: Stock Performance Chart
0 100 200 300 400 500 600 700 800 900 12/01 12/02 12/03 12/04 12/05 12/06 03/07 Index Value Unity Bancorp, Inc. NASDAQ Bank Index NASDAQ Composite Index Stock Performance Chart
Slide 28: Slide 28