Alliance Bankshares — Merger or Acquisition (September 2011)
48 slides from Alliance Bankshares's merger presentation, Sep 19, 2011
Slide 1: Eagle Bancorp Inc. September 2011
rT * @EAGLE BANCORP INC. September 2011 Ticker: EGBN www.eaglebankcorp.com
Slide 2: Forward Looking Statements
Forward Looking Statements : a . : ‘This presenation contains forward looking statements within the meaning of the Secuites and Exchange Is. Act of 1934, as amended, including statements of goals. intentions, and expectations as to future tren plans, events or results of Company operations and polic
Slide 3: Additional Information About The Merger And Where To Find It (Continued)
Additional Information About The Merger And Where To Find It_ (Continued) Investors will be able to obtain these documents free of charge at the SEC's web site (http://www.sec.gov). In addition, documents filed with the SEC by Eagle Bancorp, Inc. will be available free of charge from Eagle's Investo
Slide 4: Company Overview
Compan erview = Eagle Bancorp, Inc. is a rapidly growing commercial bank headquartered in Bethesda, Maryland o $2.4 billion in assets, focused on Washington, DC Metro Area with 14 branches o Commercially oriented business model with deep relationships on loan and deposit side of balance sheet © 2" J
Slide 5: History of Growth
History of Growth = Founding members had extensive banking experience = — Commenced operations with three Maryland branches - July, 1998 = Raised $46.5 million in initial and secondary subscription offerings - 1997* and 2003* = Reached $500 million in assets in 2004 = Private placement of $12.1 mill
Slide 6: Summary Statistics — June 30, 2011
Summary Statistics — tune 30, 2011 Total Assets: $2.4 billion ‘Total Loans: $1.9 billion $1.9 billion ‘Tangible Common Equity: $189.7 million ‘Tangible Book Value per Common Share (1): $9.56 Shares Outstanding: 19,849,042 TARP Preferred: $23.2 million (redeemed July 14, 2011) Headquarters: Bethesda,
Slide 7: EagleBank Locations
EagleBank Locations ‘Tyson's Corner Fairfax County Washington, DC iel\ : : Alexandria Prince County
Slide 8: Nationally Recognized Financial Performance
Nationally Recognized Financial Performance = Named to the Class of 2011 Sm-All Stars by Sandler O’Neill + Partners as one of the Top 25 best performing small cap banks and thrifts in the nation. = In2011, ranked by the American Banker in the top 150 banks in the country for C&I loan activity and ef
Slide 9: Financial Indicators — Regional Peer Analysis
Financial Indicators — Regional Peer Analysis Key Ratios (at or for the quarter ended June 30, 2011): EGBN Peers = Net Interest Margin 4.32% 3.76% = Efficiency Ratio * 55.13% 67.97% = NPAs + 90 Days Past Due/Total Assets 147% 2.82% = NPLs + 90 Days Past Due/Total Loans 1.60% 3.32% = Allowance Loan L
Slide 10: Financial Indicators — Local Peer Analysis
Financial Indicators — Local Peer Analysis EGBN Peers Loan Growth (June 30, 2010 - June 30, 2011) = Commercial & Industrial 30.14% — 20.40% = Commercial Real Estate 23.92% 1.84% «= Construction & Development 46.52% (11.35%) = Total Loans 29.52% 1.91% Deposit Growth (June 30, 2010 - June 30, 2011) =
Slide 11: Consistent Balance Sheet Growth
Consistent Balance Sheet Growth 82,5005 Total Assets 2.2504 $2,000 31,7904 31,5004 3 Millions of Dollars 1.0004 ill mill 06Q2 06Q3 06Q4 O7QI O7Q2 07Q3 O7Q4 OBQI O8Q2 08Q3 OSQI O9QI 09Q2 09Q3 094 10QI 10Q2 10Q3 10Q4 11QI 11? (0) Regional pers includes publicly-traded commercial banks wih assets betwe
Slide 12: Consistent Net Income Growth
Consistent Net Income Growth FLNet Income Available to Common Il TARP Dividend 6,000 5,500 $5,000 4,500 $4,000 : é 53,500 $3,000 $2,500 $2,000 31,500 $1,000 $5,756 06Q2 063 06Q1 O7QI_ O72 O7QS OTF OSGI 08Q2 08 OSA! 09QI_ 092 09Q3 OQ 1OQI 1092 10Q3 10g 11Q1 11¢2 (4) Regional pers includes publicly-tr
Slide 13: Pre-Tax, Pre-Provision Income
Millions of Dollars Pre-Tax, Pre-Provision Income si3.9%0 Quarterly Pre-Tax Pre-Provision Net Revenue sanse $12,000 $11,004 $10,000 39.0004 38.0004 87.0004 86,0004 85.0004 s4.0004 33.0004 32.0004 1,000 so 9602 0603 06Q4 07Q1 0702 O7Q_O7Q4 O8QI_08Q2 08QI OBI OAL 09Q2 0993 09QI 10QI 1092 1093 10Q1 _11
Slide 14: Deposit Market Share
Deposit Market Share WASHINGTON, DC METROPOLITAN AREA (Beda Values in Then) Local Headquarters Branches June 30,2009 June 302010 Annual == 2010 Rank Rank Campy Name cy State inst Balance Balance Growth Market Share 1 Capital One Mclean VATS B066SATG SORTS] IRIM 192886 2 Wels Fargo & Co ‘San Francisc
Slide 15: Loan Portfolio Composition
Loan Portfolio Composition Total Gross Loans: $1.9 Billion Note: At June 30, 2011 14
Slide 16: Geographic Detail of Loan Portfolio
Geographic Detail of Loan Portfolio Prince George's 31,755 18,323 88,369*10,806——1,922 405 1,868 69 153,517 ther MD 16,406 28,198 «86,687 38,038 16,056 1,103 «3,998 170 190,656 % Virginia Alexandria 7937 11464 13,548 : 5500 1,492 B9 74 40354 2.1% Aington 12,401 - 7,548 16,558___1,189 780 1,024 107 3
Slide 17: Diversified Commercial Real Estate Portfolio
Diversified Commercial Real Estate Portfolio Total: $286.5 Million Total: $719.5 Million Note: At June 30, 2011 16
Slide 18: Credit Quality Trends
Credit Quality Trends “spi post surname spo 0 ram (Dollars Values in Thousands) 30-89 Days Past Due Nonperforming Assets: 90 or More Days Past Due Nonacerual Restructured Loans Total Nonperforming Loans (NPLs) Other Real Estate Owned (OREO) ‘Total Nonperforming Assets ‘NPAs + 90 Days Past Due/Assets
Slide 19: Deposit Composition
Deposit Composition (Dolls alc in Thousands ) Deposit Type Noninterest Bearing Interest Bearing Transaction Savings & Money Market Core CD's Wholesale CD's Total Deposits %of %of %of Balance Total Balance Total Balance Total S 313,812 19.9% $ 400,291 23.2% $ 436,880 22.5% 54,489 3.5% 61,771 3.6% 67,
Slide 20: Superior Relationships/Net Interest Margin
Superior Relationships/Net Interest Margin —*-EGBN a Peers 5.25% [rar cosed August 2008] 4.75 g a 2 | 425% 3 3.75% 3.25% ‘Note: Regional poor includes publicly-traded commercial banks with Assets between S1 and $5 Dillion and headquartered in Washington, DC, Virginia, ‘West Virginia, Maryland, Penns
Slide 21: Capital Strength
Capital Strength Total Assets $1,832,991 $1,937,265 S$ 2,006,146 S$ 2,089,370 S 2,186,268 S$ 2,353,716 S$ 2,387,081 Total Capital S 192,465 S 196,743 S 202,301 S 204,716 S 210,119 $217,027 $250,392 Tier 1 Leverage Ratio 10.00% 9.84% 9.66% 9.32% 9.48% 9.07% 10.53% Tier 1 Risk Based Capital Ratio 11.7
Slide 22: Market Information — Washington, DC
Market Information —Washington, DC Metropolitan Statistical Area = Population 6.2 Million a 5th largest market in the U.S. = Employment 2.9 Million a Average annual job creation is 39,500 a Highest in net new job growth in the U.S. over last decade a Washington DC Metro area has highest concentratio
Slide 23: Unemployment Rate - Largest US Markets
Unemployment Rate- Largest US Markets May, 2011 US 8.7% Source: BLS, NOT Seasonally Adjusted
Slide 24: Greater Washington Economy - 2010
Greater Washington Economy - 2010
Slide 25: Average Sales Price Percent Change Washington MSA
Average Sales Price Percent Change Washington MS All Housing Types Annual Change Annual Change by Month 2008 2009 2010 2011 Source: MRIS, GMU Center for Regional Analysis 24
Slide 26: New Condominium Inventory
New Condominium Inventory Washington DC 6000 5000 4000 3000 2000 1000 0 2005 2006 2007 2008 2009 2010 2011 Current Inventory = 821 Units Source: The Mayhood Co, July , 2011 25
Slide 27: Looking Ahead
Looking Ahead = Complete merger and integration with Alliance Bank = Focus on organic growth Take advantage of dislocation in market «Hire seasoned lenders © Focus on relationships to increase deposit penetration = Profitability » Continued focus on Net Interest Margin © Grow noninterest components
Slide 28: Acquisitions
Acquisitions a7
Slide 29: Acquisition Strategy & History
Acquisition Strategy & History = Significant Due Diligence precedes any Offer to Acquire = Accretive Transactions are always the Goal = Acquisition #1 (F&T completed on August 31, 2008) a System conversion successfully completed one week after close a Targeted expense savings achieved in methodical
Slide 30: Alliance Bankshares Corporation Acquisition
Alliance Bankshares Corporation Acquisition Nasdaq: ABVA Strategic Matters: a Opportunity for faster growth in targeted sub-market 2 Acquire expertise in specialty deposit niche a In-market acquisition provides superior integration benefits a Both institutions are “well connected” to community a Att
Slide 31: Alliance Bankshares Acquisition - Contribution Analysis
Alliance Bankshares Acquisition - Contribution Analysis (based on data at or for the period ended June 30, 2011) EGBN ABVA Combined Contribution buyer seller dollars in thousands) Assets $ 2.353.716 $ 535,988 $ 2,889,704 19% Investment Securities $250,019 $ 114,370 $ 364,389 31% Loans $ 1,948,476 $
Slide 32: EagleBank Branches — Pro Forma
Date city Germantown Gaithersburg Annandale e Aspen Hit MD Wnoaton-Glenmont Columbia EagleBank Branches — Pro Forma Source: SNL Financial, Company Information 31
Slide 33: Why Invest in EGBN?
Why Invest in EGBN? » Driven by Profitability » Superior Net Interest Margin > Emphasis on Core Deposits and Deep Relationship Banking > — Strong Organie Growth > — Geographic Market Positioning » Experienced and Dedicated Board and Management Team ~ 17% Insider Ownership > — Exceptional Asset Quali
Slide 34: EGBN Stock Price Performance
EGBN Stock Price Performance Price Change (%) eon — se 0 —nasovazank 4000 7, 3500 +. 3000 +. 2500 +. 2000 +. 1600 4. 10.00 4. Janet Feb-tt Ma Portt May-14 sunt suet Auge sep-tt ‘Source: SNL. Financial 33
Slide 35: Appendices
Appendices 34
Slide 36: Loan Portfolio Trends
Loan Portfolio Trends (Blt es Sharan) Loan Type Babnoe _% of Total Balance _%of Total Balance _% of Total % % Commercial and Inlustil $ 370893 24.7% == $ ANITA. «26% «$482,680 2.8% 301% 345% Commercial Real Estate: (Over Occupied 209,438 13.9% 223,986 13.4% 202,266 12.4% 16.3% Investment 5666609 37.
Slide 37: Loan Portfolio by Risk Rating
Loan Portfolio by Risk Rating (Dollar Values in Thousands) 1000 - Prime sSsn 2000 - Exwellent 10973 3000-Good 781,439 4000 - Acceptable 648,506 5000 Acceptable with Risk 293,675 6000 - Watch 31682 7000 - Special Mention 30,088 8000 - Substandard 46932 9000 -Doubtful 850 100: ectie 9999 -Loss g — S19
Slide 38: Geographic Detail of NPAs
Geographic Detail of NPA’s Dollar Values Thousands) Maryland Montgomery «$1,901 § 3 - S$ - $ rs SSS 9s 8 $ 2810 : 2810 Price Georme's 4 295 1207 253 - 130k 3,063 859 3922 Other MD 470 : : 1g98 969 3.337 140 377 Washington DC 1,134 2 13 : 13820 300187 ssa 1985 18,539 Virgins Aladin 30 : : : : : 30 :
Slide 39: Conservative Securities Portfolio
Conservative Securities Portfolio (Dein Vedas it hone US Treasury Secures s : s so one US Government Agency Secures 102.98) a a “Montgage Backed Secutes - GSES 91899 os 79% “Municipal Bonds 387 4 m2 ‘ther Equity Invest us 2 Om “otal Securities ce Sst Tore US Treasury Securities s s ome US Goverment
Slide 40: Experienced Senior Management Team
Experienced Senior Management Team Years with me ‘Title/Function Ronald D. Paul Chairman, President & CEO Robert P. Pincus Vice Chairman Michael T. Flynn EVP & COO- Eagle Bancorp Susan G. Riel Sr. EVP & COO - EagleBank ‘Thomas D. Murphy President - Community Banking - EagleBank Janice L. Williams EV
Slide 41: Experienced Management Team
Experienced Management Team Ronald D. Paul, Chairman, President and CEO Mr. Paul, a founder of EagleBank, has served as Chairman since May 2008, and prior to that time was Vice Chairman and Chief Executive Officer since the organization of the Company. He also has served as Chairman of the Board of
Slide 42: Experienced Management Team
Experienced Management Team Susan G. Riel, Senior EVP, Chief Operating Officer of EagleBank Ms. Riel, Senior Executive Vice President - Chief Operating Officer of the Bank, and formerly Chief Administrative Officer. Ms.Riel has been with the bank for 12 years. She previot served as Executive Vice Pr
Slide 43: Experienced Management Team
Experienced Management Team Antonio F: Marquez, EVP, Chief Commercial Real Estate Lender Mr. Marquez, Executive Vice President, recently joined EagleBank as the Chief Real Estate. Lender. Prior to joing EagleBank, Mr. Marquez established the real estate lending franchise for HSBC for the Washington,
Slide 44: Historical Balance Sheet
Historical Balance Sheet B
Slide 45: a8
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Slide 46: Historical Income Statement
Historical Income Statement (Dollar Values in Thousands, except per share data) ‘Total Interest Income Total Interest Expense Net Interest Income Loan Loss Provision ‘Service Charges on Deposits Gain/Loss on Sale of Loans Gain/Loss on Sale of Securities BOLI Revenue (Other Noninterest Income ‘Total
Slide 47: Historical Quarterly Income Statement
Historical Quarterly Income Statement (DoterValesin Thousands except pr share data) Total terest Income Total Interest Expense ‘Ne Interest Income Loan Loss Provision Service Charges on Deposits GainvLoss on Sale of Loans (GainvLoss on Sake of Securities BOLI Revenue Other Nontrest Income ‘Total Non
Slide 48: GAAP Reconciliation
GAAP Reconciliation December31, March31, June 30, September 30, December31,—- Mare 31, June 30, (Goltars in thousands except per share data) 2009 2010 2010 2010 2010 201 201 ‘Common stockholders’ equity S 165,709 $ 17OIG S$ I7A2S0 S$ TB.T6L_ SSRIS SISTA SR IR Less: Intangible assets 43m) a3) 42409)
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