Independent Bank Corporation · NASDAQ:IBCP
Independent Bank — Q4 2015 Earnings Presentation
22 slides from Independent Bank's earnings presentation, Jan 25, 2016
Slide 1: Independent Bank Corporation Earnings Conference Call 4th Quarter 2015
Independent Bank Corporation Earnings Conference Call 4th Quarter 2015 (january 25, 2016)
Slide 2: Cautionary Note Regarding Forward-Looking Statements
2 Cautionary Note Regarding Forward-Looking Statements This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements of goals, intentions, and expectations as to future trends, plans, events, or results of Indep
Slide 3: Agenda
3 Agenda Formal Remarks.William B. (Brad) Kessel, President and Chief Executive OfficerRobert N. Shuster, Executive Vice President and Chief Financial OfficerQuestion and Answer session.Closing Remarks.Note: This presentation is available at www.IndependentBank.com in the Investor Relations area und
Slide 4: Financial Summary
4 Financial Summary 4Q’15 3Q’15 2Q’15 1Q’15 4Q’14 Diluted EPS $ 0.25 $ 0.22 $ 0.24 $ 0.16 $ 0.17 Income before taxes 8,251 7,325 8,243 5,561 5,438 Net income 5,570 5,047 5,619 3,781 3,902 Return on average assets 0.93% 0.86% 0.98% 0.67% 0.69% Return on average equity 8.80% 7.84% 8.86% 6.05% 6.19% To
Slide 5: 4Q 2015 Financial Highlights
5 4Q 2015 Financial Highlights Income StatementNet income of $5.6 million, or $0.25 per diluted share.Net interest income of $19.4 million, up $1.3 million, or 7.2%, from year ago quarter.$1.7 million credit loan loss provision.Gains on mortgage loans of $1.7 million, up $0.2 million, or 15.0% from
Slide 6: 2015 Annual Financial Highlights
6 2015 Annual Financial Highlights Income StatementNet income of $20.0 million, up $2.0 million, or 11.1%, over 2014.Diluted EPS of 86 cents, up nine cents, or 11.7%, over 2014.Net interest income of $75.0 million, up $1.7 million, or 2.4% over 2014.Improved asset quality metrics led to $2.7 million
Slide 7: Our Michigan Markets
7 Our Michigan Markets Since 2012, substantial changes have been implemented to streamline and optimize our branch delivery network.Significant market presence and opportunity to gain market share in attractive Michigan markets. Michigan’s unemployment rate was 5.1% in November 2015 (1.4% lower than
Slide 8: Our Markets – Regional
8 Our Markets – Regional Region Cities Branches 12/31/15 Loans(1) % ofLoans(1) 12/31/15Deposits(3) % of Deposits(3) 12/31/14 Loans(2) 12/31/14 Deposits(3) East / “Thumb” Bay City / Saginaw 23 $304 23% $715 36% $295 $696 West Grand Rapids / Ionia 22 499 37% 649 32% 454 579 Central Lansing 11 194 15%
Slide 9: Low Cost Deposit Franchise Focused on Core Deposit Growth
9 Low Cost Deposit Franchise Focused on Core Deposit Growth Deposit Highlights$2.09 billion in total deposits at 12/31/15.Substantially all core funding.$1.66 billion of transaction accounts (79.6% of total deposits).Total deposits increased $161.7 million, or 8.4% since 12/31/14.Average deposits pe
Slide 10: Diversified Loan Portfolio Focused on High Quality Growth
10 Diversified Loan PortfolioFocused on High Quality Growth Lending HighlightsSeven consecutive quarters of net loan growth.$1.54 billion in total loans at 12/31/15 (including $27.9 million of loans held for sale).4Q 2015 lending results include:Commercial loan growth of $22.0 million, or 12.0% annu
Slide 11: Net Interest Margin/Income Highlights
11 Net Interest Margin/Income HighlightsInterest rate sensitivity profile of the loan and securities portfolios, in combination with a low cost core deposit base, positions us to benefit from a rising interest rate environment.Net interest income increased in 4Q’15 vs. 3Q’15 due to a $66.2 million i
Slide 12: Net Interest Income and Net Interest Margin Details
12 Net Interest Income and Net Interest Margin Details Summary4Q’15 net interest income of $19.353 million, up $512K from 3Q’15. The linked quarter increase was due to a $202K increase in interest income and fees on loans and a $371K increase in interest income on securities and investments that was
Slide 13: Non-interest Income Highlights
13 Non-interest Income HighlightsDiverse sources of non-interest income which totaled $10.1 million in 4Q’15.4Q’15 total non-interest income represents approximately 34.2% of total revenue (net interest income and non-interest income).4Q’15 interchange revenue down $0.2 million, or 11.1%, compared t
Slide 14: Non-interest Expense Highlights
14 Non-interest Expense HighlightsQ4’15 non-interest expenses totaled $22.8 million (a decrease from Q4’14 but an increase from Q3’15).Q4’15 compensation and benefits increased by $0.5 million over Q3’15 due to higher performance based compensation that reflects better overall profitability, improve
Slide 15: Investment Securities Portfolio Highlights
15 Investment Securities Portfolio HighlightsHigh quality, liquid, diverse portfolio with short duration.76% of the portfolio is AAA rated (or backed by the U.S. Government).2.0 year estimated average duration with a weighted average yield of 1.76% (without TE gross up).Approximately 33% of the port
Slide 16: Credit Quality Summary
16 Credit Quality Summary Note: Non-performing loans and non-performing assets exclude troubled debt restructurings that are performing. Non-performing Assets ($ in Millions) ORE/ORA ($ in Millions) Non-performing Loans ($ in Millions) 30 to 89 Days Delinquent ($ in Millions)
Slide 17: Credit Cost Summary
17 Credit Cost Summary Note: Dollars all in millions. Provision for Loan Losses Loan Net Charge-Offs Allowance for Loan Losses
Slide 18: Classified Assets and New Default Trends
18 Classified Assets and New Default Trends Note: Dollars all in millions. Total Classified Assets Commercial Loan New Defaults Total Loan New Defaults Retail Loan New Defaults
Slide 19: Troubled Debt Restructurings (TDRs)
19 Troubled Debt Restructurings (TDRs) TDR HighlightsWorking with client base to maximize sustainable performance.The specific reserves allocated to TDRs totaled $10.9 million at 12/31/15.A majority of our TDRs are performing under their modified terms but remain in TDR status for the life of the lo
Slide 20: 2016 Management Outlook
20 2016 Management Outlook Category Outlook Lending Continued growthGoal of high single digit % overall loan growth in 2016, primarily supported by increases in commercial loans, consumer loans and mortgage loans with payment plan receivables relatively stable. Mortgage loan growth supported by a bu
Slide 21: Strategic Initiatives
21 Strategic Initiatives Balance SheetGenerate quality loan growth with continued focus on commercial and consumer installment lending as well as salable mortgage loans. May consider augmenting loan growth with selective in-market whole loan purchases.Remain asset sensitive and positioned to benefit
Slide 22: Q&A and Closing Remarks
22 Q&A and Closing Remarks Question and Answer SessionClosing RemarksThank you for attending !NASDAQ: IBCP