Slide 1: Investor Presentation Fourth Quarter, 2014
INVESTOR PRESENTATION Fourth Quarter, 2014
Slide 2: Forward Looking Statements
FORWARD LOOKING STATEMENTS Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995: Statements in this presentation regarding The Bancorp, Inc.’s business that are not historical facts are “forward-looking statements” that involve risks and uncertainties. These statements ma
Slide 3: Planning for Growth with Safety and Soundness
PLANNING FOR GROWTH WITH SAFETY AND SOUNDNESS • Strategic Goal: – Create and grow a stable, profitable institution with the optimum reliance on capital, risk management and technology, and manage it with knowledgeable and experienced management and senior officers • Tactical Approach: – Deposits - U
Slide 4: Planning for Growth
PLANNING FOR GROWTH Sources: Federal Reserve, FRB Boston, FRB Philadelphia, SRI Consulting, University of Michigan, Mintel, Celent, Bank of America, comScore, Nielsen Mobile, Wall Street Journal, AlixPartners, Pew Research Center
Slide 5: Business Model: A Distinct Business Strategy
BUSINESS MODEL: A DISTINCT BUSINESS STRATEGY (1) Specialty Finance Payments Corporate Securities Portfolio Primarily highly rated government obligations & corporate securities • Interest Income Government Guaranteed Lending (GGL) Includes loans to franchisees; 51% of which have a 75% guaranty by the
Slide 6: Revenue Composition
REVENUE COMPOSITION Post Provision Income (1) $ (1) For reconciliation detail, please see Appendix, page 22. (2) Compound annual growth rate is calculated for the years 2010 through 2014.
Slide 7: Prepaid Gross Dollar Volume and Cardholder Growth
PREPAID GROSS DOLLAR VOLUME (GDV) (1) AND CARDHOLDER GROWTH (1) Gross Dollar Volume (GDV) is the total amount spent on all cards outstanding within a given period. GDV is further broken out according to volume by contract year. (2) Compound annual growth rate is calculated for the years 2010 through
Slide 8: Non-Interest Income-Generating Strategies: Growth and Sustainability
NON-INTEREST INCOME-GENERATING STRATEGIES: GROWTH AND SUSTAINABILITY 15% Decrease $ 8% -6% 28% 34% 14% -120% 73% $84,426 (2) (1) Compound annual growth rate is calculated for the years 2010 through 2014. (2) Excludes gains on sales of investment securities. For reconciliation detail, please refer to
Slide 9: Scalable Business Model: Non-Interest Income / Non-Interest Expense
SCALABLE BUSINESS MODEL: NON-INTEREST INCOME / NON-INTEREST EXPENSE (1) (1) For reconciliation detail, please refer to Appendix, page 23. (2) Compound annual growth rate is calculated for the years 2010 through 2014. (3) Peers are comprised of insured commercial banks having assets greater than $3 b
Slide 10: Scalable Business Model: Non-Interest Expense/Average Earning Assets
SCALABLE BUSINESS MODEL: NON-INTEREST EXPENSE/AVERAGE EARNING ASSETS (1) (1) For reconciliation detail, please refer to Appendix, page 23. Assets Held for Sale, from discontinued operations, are assumed to be reinvested and are included in the calculation. (2) Source: BankRegData.com. (2)
Slide 11: Compressed Interest Rate Environment: Net Interest Income Generators
COMPRESSED INTEREST RATE ENVIRONMENT: NET INTEREST INCOME GENERATORS (1) Compound annual growth rate is calculated for the years 2010 through 2014 . $
Slide 12: Adjusted Operating Earnings
ADJUSTED OPERATING EARNINGS (1) $ (1) For reconciliation detail, please see Appendix, page 24 .
Slide 13: Asset-Generating Strategies: Business Line Overview
CATEGORY (in thousands) 421,862 293,109 2.57% 211,364 148,109 4.23% 194,464 175,610 6.12% 178,376 55,196 3.33% 42,743 53,068 3.36% 46,990 67 2.50% Discontinued Business Line* (formerly Community Bank) 898,134 1,303,125 3.65% • Investment Securities – High credit quality tax exempt municipal obligati
Slide 14: Asset Quality Overview
ASSET QUALITY OVERVIEW Reserves/Loans (1) Source: BankRegData.com (2) Texas Ratio = (Non-accrual Loans + Restructured Loans + Loans 90+ days past due + OREO)/(Loss Reserves + Tangible Equity). TBBK computed with consolidated capital. Sources: SNL Financial; FDIC Call Reports.
Slide 15: Primary Deposit-Generating Strategies: Business Line Overview
PRIMARY DEPOSIT-GENERATING STRATEGIES: BUSINESS LINE OVERVIEW CATEGORY Q4 2014 BALANCE (in thousands) Q4 2014 AVG. COST $2,034,224 0.02% 1,157,512 0.37% 461,674 0.47% 699,239 0.67% 15,286 0.17% Discontinued Business Line* 223,154 0.16% Discontinued Product* 47,934 0.02% Total Deposits: $4.4 billion
Slide 16: Deposit-Generating Strategies: Sticky and Long-Term
DEPOSIT-GENERATING STRATEGIES: STICKY AND LONG-TERM The Bancorp is deeply integrated with its private label banking partners, and has long-term, often exclusive agreements in place. (1) Percentages shown include deposits associated with private label agreements in the Healthcare, Institutional Banki
Slide 17: Planning for Growth with Safety and Soundness
PLANNING FOR GROWTH WITH SAFETY AND SOUNDNESS • Strategic Goal: – Create and grow a stable, profitable institution with the optimum reliance on capital, risk management and technology, and manage it with knowledgeable and experienced management and senior officers • Tactical Approach: – Deposits - U
Slide 18: Appendix
APPENDIX
Slide 19: Selected Capital and Asset Quality Ratios, Balance Sheet Data
As of or for the three months ended December 31, 2014 (dollars in thousands) As of or for the three months ended December 31, 2013 (dollars in thousands) Selected Capital and Asset Quality Ratios: Equity/assets 7.10% 7.64% Tier 1 capital to average assets 8.04% 8.58% Tier 1 capital to total risk-wei
Slide 20: Current Loan Portfolio and Asset Quality Overview
Category ( dollars in thousands) Balance % of Total Loans Nonaccrual Loans Nonaccrual/ Total Loans OREO 30-89 Days Delinquent 90+ Days Delinquent Q4 2014 Quarterly Charge-offs (net) SBA $172,660 16% $- -% $- $- $ - $(253) SBA held for sale 38,704 4% - - - - - - Leasing 194,464 18% - - - 6,915 149 (2
Slide 21: Specialty Finance and Payments Category Results
Specialty Finance Payments Corporate Category (dollars in thousands) Institutional Banking GGL CMBS Leasing Prepaid General Affinity HSA Payment Acceptance Investment Securities Interest income 11,753 8,344 4,354 11,951 - - 1 56 34,261 Interest expense 4,647 - - - 325 268 2,149 3,396 - Non interest
Slide 22: Post Provision Income Reconciliation
Category (dollars in millions) 2010 2011 (2) 2012 2013 2014 Q4 2013 Q4 2014 Interest income $24.4 $31.1 $39.4 $51.2 $70.7 $14.3 $18.5 Interest expense (12.4) (10.3) (10.1) (10.0) (10.8) (2.5) (2.7) Net interest income 12.0 20.8 29.3 41.1 59.9 11.8 15.8 Provision for loan and lease losses (1.4) (1.7)
Slide 23: Non-Interest Expense Ratio Reconciliation
Category (dollars in thousands) Q4 2014 Q3 2014 Q2 2014 Q1 2014 Q4 2013 Q3 2013 Q2 2013 Q1 2013 Q4 2012 Q3 2012 Q2 2012 Q1 2012 Average assets 4,443,016 4,293,960 4,475,754 4,955,143 4,261,727 3,984,728 3,972,306 4,165,418 3,341,602 3,084,178 3,384,272 4,107,802 Other assets 64,904 85,541 132,332 11
Slide 24: Adjusted Earnings Reconciliation
Category (dollars in thousands) Q4 2014 Q3 2014 Q2 2014 Q1 2014 Q4 2013 Q3 2013 Q2 2013 Q1 2013 Q4 2012 Q3 2012 Q2 2012 Q1 2012 Income before income tax expense (3,264) 1,535 3,404 4,936 6,696 3,060 6,025 5,206 1,220 (1,151) (2,365) (133) BSA and lookback consulting expense 3,883 2,749 2,169 - - - -
Slide 25: The Bghedtp
<7? The Bghedtp
Slide 26: www.thebancorp.com
www.thebancorp.com