Sb Financial Group, Inc. · NASDAQ:SBFG
Sb Financial — Shareholder Meeting (April 2021)
48 slides from Sb Financial's shareholder meeting presentation, Apr 21, 2021
Slide 1: 2021 Annual Meeting of Shareholders
2021 ANNUAL MEETING OF SHAREHOLDERS 1
Slide 2: 2020 Business Overview
2020 Business Overview € financialgroup
Slide 3: Safe Harbor Statement
Safe Harbor Statement Certain statements within this document, which are not statements of historical fact, constitute forward - looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward - looking statements involve risks and uncertainties and actual resu
Slide 4: 2020 Highlights
• Net income of $18.8* million or $2.44*/ share • Assets grew by $219 million or 21.1 % • ROAA 1.61%* -- 83 rd percentile (12 th place )** • Ranked 125 out of 200 Banks According to ABA (2019 ) • Improved our position to the 3 rd largest mortgage producer in the greater Columbus market (2019 Volume)
Slide 5: Our Vision
Our Vision over the next five years is to operate as a Russell 2000, integrated, diversified financial services conglomerate with high - performing affiliates, as we balance the needs of our shareholders, clients, staff and communities. Russell 2000 Commitment to Stakeholders High Performance Our Vi
Slide 6: Return On Average Assets (ROAA)
0.00 0.25 0.50 0.75 1.00 1.25 1.50 1.75 2015 2016 2017 2018 2019 2020 ROAA SBFG Peer Group Top Quartile* 1.61% ** 83rd Percentile * Peer group consists of SNL 20 20 data for 65 publicly traded bank holding companies in the U.S. on a major exchange with assets between $500 million and $ 2.06 billion.
Slide 7: Corporate Overview
• NASDAQ: SBFG • Defiance, Ohio - Headquarters since 1902 • Corporate Staff Members - 244 • Average Daily Share Volume for 2020 – 16,900; 7.4 million common shares • Institutional Ownership: 49.6% • Market Cap: $135 million ($18.28 share 12/31/2020) Corporate Overview 18
Slide 8: Our Organization & Leadership
Our Organization & Leadership 19 CORPORATE LEADERSHIP • Mark Klein – Chairman, President/CEO • Tony Cosentino – EVP/CFO • Ernesto Gaytan – EVP/Chief Technology Innovation and Operations Officer • Keeta Diller – EVP/Chief Risk Officer REGIONAL/COMMERCIAL LEADERSHIP • David Homoelle – Regional Preside
Slide 9: Unique Qualities
RRE $9.5M / 51% Retail/PCG $4.1M / 22% Commercial /SBA $3.1M / 16% Non - Bank $1.8M / 10% WM $0.3M/ 1% NET INCOME CONTRIBUTIONS 20 20 NET INCOME $ 18.8* MILLION 20 20 ASSETS UNDER MANAGEMENT $ 3.1 BILLION COMPRISED OF: • $ 1.3B Commercial Bank • $1.3B Residential Sold Portfolio • $ 558 M Wealth Mana
Slide 10: Key Initiatives
Key Initiatives Remain a Russell 2000, High - Performing Financial Services Conglomerate Increase profitability through ongoing diversification of revenue streams Strengthen penetration in all markets served Expand product service utilization by new and existing customers Deliver gains in operationa
Slide 11: Key Initiatives
Key Initiatives Become a Top - Decil e, Independent Financial Services Company Increase profitability through ongoing diversification of revenue streams Strengthen penetration in all markets served Expand product service utilization by new and existing customers Deliver gains in operational excellen
Slide 12: Diversity Highlights
• Expanded Operating Revenue • Maintained an Asset Sensitive Balance Sheet • Grew our Fee - Based Business Lines • Generated Market - Leading Non - Interest Income Revenue Diversity Highlights 23
Slide 13: Increase Profitability Through Diversification of Revenue Streams
Increase Profitability THROUGH DIVERSIFICATION OF REVENUE STREAMS $0 $2 $4 $6 $8 $10 $12 $14 $16 $18 $20 $0 $5 $10 $15 $20 $25 $30 $35 $40 $45 $50 $55 $60 $65 $70 2016 2017 2018 2019 2020 REVENUE (MIL) TOTAL REVENUE/NET INCOME Peak Title Other SBA Mortgage Service Charges Wealth Management Net Inter
Slide 14: 2020 Revenue/Net Income by Business Line
20% 14% 33% 22% 34% 51% 5% 1% 3% 2% 3% 3% 2% 7% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Revenue Net Income 2020 REVENUE/NET INCOME BY BUSINESS LINE Other Peak Title SBA Wealth Management Mortgage Retail/PCG Commercial Increase Profitability THROUGH DIVERSIFICATION OF REVENUE STREAMS 25
Slide 15: Non-Interest Income/Revenue vs Peers
* Peer group consists of SNL 20 20 data for 65 publicly traded bank holding companies in the U.S. on a major exchange with assets between $500 million and $ 2.06 billion 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0% 45.0% 50.0% 2016 2017 2018 2019 2020 PERCENTAGE NON - INTEREST INCOME/ REVENUE
Slide 16: Mortgage Volume and Gain on Sale
$383 $316 $342 $445 $694 $0 $50 $100 $150 $200 $250 $300 $350 $400 $450 $500 $550 $600 $650 $700 $750 $0 $5 $10 $15 $20 $25 $30 2016 2017 2018 2019 2020 MORTGAGE VOLUME (MIL) MORTGAGE GAIN ON SALE (MIL) MORTGAGE GAIN ON SALE/VOLUME NW Ohio Columbus Findlay Indy Total $ Originations Increase Profitab
Slide 17: SBA Lending
Increase Profitability THROUGH DIVERSIFICATION OF REVENUE STREAMS $7.5 (9.4) $6.4 (8.4) $11.6 (15.6) $12.2 (16.4) $8.1 (11.8) $0.8 (4.7) $0.0 $2.0 $4.0 $6.0 $8.0 $10.0 $12.0 $14.0 $0.0 $0.2 $0.4 $0.6 $0.8 $1.0 $1.2 $1.4 2015 2016 2017 2018 2019 2020 SOLD VOLUME (MIL) GAIN ON SALE (MIL) SBA Gains Sol
Slide 18: Paycheck Protection Program
Increase Profitability THROUGH DIVERSIFICATION OF REVENUE STREAMS PAYCHECK PROTECTION PROGRAM 29 $67.0 $23.7 $16.5 $5.1 $0 $10 $20 $30 $40 $50 $60 $70 $80 $90 2020 2021 Millions Customers Prospects ~$5.0 Million in Fees
Slide 19: Wealth Management AUM & Revenue
$378 $437 $423 $508 $558 $0.0 $0.5 $1.0 $1.5 $2.0 $2.5 $3.0 $3.5 $0 $100 $200 $300 $400 $500 $600 2016 2017 2018 2019 2020 AUM (in MIL) WEALTH MANAGEMENT AUM & REVENUE Revenue (in MIL) Increase Profitability THROUGH DIVERSIFICATION OF REVENUE STREAMS 30
Slide 20: 2020 Non-Interest Income
67% 9% 11% 2% 5% 6% Mortgage Banking $20.3 Service Fees $2.8 Wealth Management $3.2 SBA/FSA $0.5 Other $1.4 Peak Title $1.9 20 20 NON - INTEREST INCOME $ 30.1 MILLION Non - Interest Income to Total Revenue at 46 % ( 88 th Percentile) Peer Median* 23 % Top Quartile* 32 % * Peer group consists of 2020
Slide 21: Key Initiatives
Key Initiatives Become a Top - Decil e, Independent Financial Services Company Increase profitability through ongoing diversification of revenue streams Strengthen penetration in all markets served Expand product service utilization by new and existing customers Deliver gains in operational excellen
Slide 22: Scale Through Organic Growth Highlights
Scale Through Organic Growth Highlights 33 • Growing our Balance Sheet • Building Market Share • Acquiring scale through M&A - Edon
Slide 23: Balance Sheet Growth
34 Strengthen Market Penetration IN ALL MARKETS SERVED -$25 $25 $75 $125 $175 $225 2016 2017 2018 2019 2020 Millions BALANCE SHEET GROWTH Loans Deposits
Slide 24: Loan/Deposit Growth by Market
Toledo $134M Findlay $ 52 M Columbus $153M Williams Co. $42M Defiance $ 130 M Strengthen Market Penetration IN ALL MARKETS SERVED 35 Total Loan and Deposit Growth Over Last 5 Years: $778M Edon acquisition added $70M in loans & deposits LOAN/DEPOSIT GROWTH Lima $49M
Slide 25: Loan Portfolio and Total Assets
Loans (Net) 69% Securities 12% Cash & Due 11% Other 8% Commercial RE 43% HELOC 5% 1 - 4 Family 20% Agriculture 6% C&I 23% Consumer & Other 3% LOAN PORTFOLIO = $ 873 MILLION Strengthen Market Penetration IN ALL MARKETS SERVED 36 Loan to Deposit December 2020 – 83% Top Quartile Performance TOTAL ASSET
Slide 26: Deposit Portfolio and Funding Sources
Borrowings 3% Deposits 83% Capital 11% Other 3% Time 22% MMDA 20% Savings 17% Interest Bearing 17% Non - Interest 24% DEPOSIT PORTFOLIO = $ 1.0 BILLION Strengthen Market Penetration IN ALL MARKETS SERVED 37 Transactional deposits = 78% of total deposits Weighted average cost of deposits = 64 bps* *2
Slide 27: Key Initiatives
Key Initiatives Become a Top - Decil e, Independent Financial Services Company Increase profitability through ongoing diversification of revenue streams Strengthen penetration in all markets served Expand product service utilization by new and existing customers Deliver gains in operational excellen
Slide 28: Added Scope Highlights
Added Scope Highlights • Regional Executive/Business Line Leadership • Customized Client Interaction • Defined Communication Channels • Referrals 39
Slide 29: Market Executives
Market Executives BOWLING GREEN FULTON & WILLIAMS COUNTIES Mark Cassin – SVP, Market Executive TOLEDO Tyson Moss – SVP, Market Executive Chris Webb – SVP, Market Executive LIMA FINDLAY Andy Farley – SVP, Market Executive Stefan Hartman – SVP, Market Executive FORT WAYNE COLUMBUS David Homoelle – Reg
Slide 30: Business Line Leadership
Business Line Leadership RETAIL BANKING PRIVATE BANKING Nancy Rankin – VP, Retail Administration Manager MORTGAGE BANKING Michelle Zeedyk – VP, Director of Private Banking Mickey Cooper – SVP, Toledo Susan West – VP, Columbus Steve Watson – SVP, RRE Manager, Columbus, OH Pam Benedict – SVP, RRE Mana
Slide 31: Expand Product Utilization
76,847 80,513 83,593 87,202 91,154 95,210 26,076 27,368 28,590 29,562 30,377 32,519 0 5,000 10,000 15,000 20,000 25,000 30,000 35,000 40,000 45,000 0 10,000 20,000 30,000 40,000 50,000 60,000 70,000 80,000 90,000 100,000 2015 2016 2017 2018 2019 2020 HOUSEHOLDS PRODUCTS & SERVICES HOUSEHOLDS, PRODUC
Slide 32: Electronic vs In-Office Transactions
0 300 600 900 1,200 1,500 0 1,000 2,000 3,000 4,000 5,000 6,000 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 IN - OFFICE TRANSACTIONS PER YEAR (000’S) ELECTRONIC TRANSACTIONS PER YEAR (MIL) ELECTRONIC TRANSACTIONS & IN - OFFICE TRANSACTIONS Electronic Transactions In-Store Transactions Acc
Slide 33: Referrals & New Business
2,416 1,805 1,857 1,712 1,636 1,140 1,006 1,021 959 811 $103.5 $64.9 $92.8 $71.3 $99.5 $0 $20 $40 $60 $80 $100 $120 0 700 1,400 2,100 2,800 2016 2017 2018 2019 2020 NEW BUSINESS (MIL) REFERRALS REFERRALS & NEW BUSINESS Gross Closed New Business Expand Product Utilization BY NEW AND EXISTING CUSTOMER
Slide 34: Key Initiatives
Key Initiatives Become a Top - Decil e, Independent Financial Services Company Increase profitability through ongoing diversification of revenue streams Strengthen penetration in all markets served Expand product service utilization by new and existing customers Deliver gains in operational excellen
Slide 35: Deliver Gains in Operational Excellence
Deliver Gains in Operational Excellence that Includes Technology • Implemented Precision Lender • Launched nCino (Next generation loan origination system) • Embraced Sales Force (Company - wide CRM) • Consumer Connect (Mortgage Application) 46
Slide 36: Mortgage Servicing Portfolio
$772,533 $899,710 $994,915 $1,084,678 $1,199,107 $1,299,697 5,632 6,414 7,051 7,586 8,155 8,543 0 1,700 3,400 5,100 6,800 8,500 10,200 $0 $250,000 $500,000 $750,000 $1,000,000 $1,250,000 $1,500,000 2015 2016 2017 2018 2019 2020 NUMBER OF LOANS $ OF LOANS ($000s) MORTGAGE SERVICING PORTFOLIO Servicin
Slide 37: Loan Production & Loan Growth
Deliver Gains in Operation Excellence $0 $10,000 $20,000 $30,000 $40,000 $50,000 $60,000 $70,000 $80,000 $90,000 $100,000 $0 $100,000 $200,000 $300,000 $400,000 $500,000 $600,000 $700,000 $800,000 $900,000 2016 2017 2018 2019 2020 LOAN GROWTH ($000S) LOAN PRODUCTION BY TYPE ($000s) LOAN PRODUCTION &
Slide 38: Key Initiatives
Key Initiatives Become a Top - Decil e, Independent Financial Services Company Increase profitability through ongoing diversification of revenue streams Strengthen penetration in all markets served Expand product service utilization by new and existing customers Deliver gains in operational excellen
Slide 39: Asset Quality Highlights
• Robust Loan - Review Process • Dynamic Loan - Approval Process • Portfolio Stress - Testing • Strong AQ Metrics Asset Quality Highlights 50
Slide 40: Forbearance History
Sustain Asset Quality $153,306 $38,353 $28,032 $4,883 262 26 9 2 0 50 100 150 200 250 300 $0 $20,000 $40,000 $60,000 $80,000 $100,000 $120,000 $140,000 $160,000 $180,000 June 2020 September 2020 December 2020 March 2021 NUMBER OF LOANS LOAN BALANCES (000’s) FORBEARANCE HISTORY $ Amount Number of Loa
Slide 41: Non-Performing Assets / Total Assets
* Peer group consists of SNL 3Q 20 20 data for 65 publicly traded bank holding companies in the U.S. on a major exchange with assets between $500 million and $ 2.07 billion. 1.15 0.65 0.44 0.40 0.64 0.58 1.41 1.26 1.00 0.76 0.61 0.49 1.07 0.76 0.68 0.43 0.39 0.22 0.00 0.70 1.40 2.10 2015 2016 2017 2
Slide 42: NCOs / Average Loans
* Peer group consists of SNL 3Q 20 20 data for 65 publicly traded bank holding companies in the U.S. on a major exchange with assets between $500 million and $ 2.07 billion. 0.00% 0.11% 0.21% 2016 2017 2018 2019 2020 NCOs/ AVERAGE LOANS SBFG Peer Median* Top Quartile* PERCENTAGE Sustain Asset Qualit
Slide 43: Reserve to Non-Performing Loans
50.0% 100.0% 150.0% 200.0% 250.0% 300.0% 350.0% 2015 2016 2017 2018 2019 2020 RESERVE TO NON - PERFORMING LOANS SBFG Median Top Quartile Sustain Asset Quality 54
Slide 44: Loan Loss Reserve
Sustain Asset Quality 55 0.00% 0.20% 0.40% 0.60% 0.80% 1.00% 1.20% 1.40% 1.60% $0.0 $2.0 $4.0 $6.0 $8.0 $10.0 $12.0 $14.0 2016 2017 2018 2019 2020 Millions LOAN LOSS RESERVE Dollars Percentage
Slide 45: Key Initiatives
Key Initiatives Become a Top - Decil e, Independent Financial Services Company Increase profitability through ongoing diversification of revenue streams Strengthen penetration in all markets served Expand product service utilization by new and existing customers Deliver gains in operational excellen
Slide 46: Maximizing Shareholder Value
$0.00 $0.50 $1.00 $1.50 $2.00 $2.50 $0.00 $3.00 $6.00 $9.00 $12.00 $15.00 $18.00 2016 2017 2018 2019 2020 $ EARNINGS & DIVIDENDS PER SHARE $TBV PER SHARE SBFG TBV Dividends Per Share Earnings Per Share ONE - TIME TAX CUT IMPACT Maximizing Shareholder Value 57
Slide 47: Need a potential picture for a final pandemic statement to close 47
Need a potential picture for a final pandemic statement to close 47
Slide 48: financialgroup
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