Stifel Financial Corporation · NYSE:SF
Stifel Financial — Investor Presentation (November 2018)
41 slides from Stifel Financial's investor presentation, Nov 14, 2018
Slide 1: Investor Presentation November 2018
Investor Presentation November 2018 Exhibit 99.1
Slide 2: Disclaimer
Disclaimer Forward-Looking Statements This presentation may contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 that involve significant risks, assumptions, and uncertainties, including statements relating to the market opportunity and futu
Slide 3: Our Strategy
Our Strategy STIFEL
Slide 4: Strategic Vision
Strategic Vision To build a premier wealth management and investment banking firm Global Wealth Management Institutional Private Client 2,298 financial advisors in 368 branches with more than $257B in client assets Asset Management $31B in total assets managed through various strategies Bank $17B in
Slide 5: A History of Growth
A History of Growth 2005 Legg Mason’s Capital Markets Division 2008 Butler Wick 2009 56 UBS Private Client Branches 2010 Thomas Weisel Partners 2007 Ryan Beck Acquisition Stifel Bank & Trust 2011 Stone & Youngberg 2012 Miller Buckfire 2013 Knight Capital Group’s Fixed Income Division 2014 De La Rosa
Slide 6: Years of Substantial Growth
10 Years of Substantial Growth *Non-GAAP Results ** Share Price and Market Capitalization as of 1/24/2018, FactSet
Slide 7: Driving Shareholder Value Through Deal Integration & Balance Sheet Growth
Driving Shareholder Value Through Deal Integration & Balance Sheet Growth
Slide 8: Infrastructure Build and Balance Sheet Growth
139% Growth 159% Growth Infrastructure Build Balance Sheet Growth
Slide 9: Bank Drove Significant Balance Sheet & Revenue Growth
Bank Drove Significant Balance Sheet & Revenue Growth Bank growth has been balanced between loans and investments: Loans: Comprised of securities based loans, C&I, and residential mortgages Focused lending to high net worth retail clients AFS & HTM Investments: Portfolio primarily GSE MBS, ABS, and
Slide 10: Stifel Overview
Stifel Overview STIFEL 10
Slide 11: Stifel – Premier Investment Bank and Wealth Management Firm
Stifel – Premier Investment Bank and Wealth Management Firm Stifel at a Glance 2017 GAAP Net Revenue - $2.9 billion Global Wealth Management (GWM) 2017 Net Revenue - $1.8 billion Institutional Group (IG) 2017 Net Revenue - $1.1billion Private Client Stifel Bank & Trust Margin and Securities-based Le
Slide 12: Leading broker-dealer providing wealth management and institutional services
Leading broker-dealer providing wealth management and institutional services to consumers and companies Bulge Bracket Boutique Size / scale Large distribution Trading Retail Issues Lack of focus Banker turnover Lack of commitment Research indifference Lack of growth investors Firm focus Good researc
Slide 13: Well-diversified, Low Risk Business Model
Well-diversified, Low Risk Business Model with Balanced Retail and Institutional Exposure Unburdened by capital constraints Low leverage business model and conservative risk management Limited balance sheet risk Stable wealth management business is augmented by profitable and growing institutional b
Slide 14: A Stable Track Record Through Multiple Business Cycles
A Stable Track Record Through Multiple Business Cycles Non-GAAP Net Revenues(1) ($MM) Total Equity ($MM) Total Client Assets(2) ($BN) Book Value Per Share(3) 2018 full year non-GAAP net revenues based on annualized result as of 9/30/2018 Excludes impact of sale of Sterne Agee Independent Contractor
Slide 15: Global Wealth Management
Global Wealth Management STIFEL
Slide 16: Global Wealth Management (GWM) Overview
Global Wealth Management (GWM) Provides Securities Brokerage Services and Stifel Bank Products Overview National Presence Grown from 600+ financial advisors in 2005 to 2,298 financial advisors currently Proven organic growth and acquirer of private client business Strategy of recruiting experienced
Slide 17: Building Scale and Capabilities into a $1.8B Revenue Segment
Building Scale and Capabilities into a $1.8B Revenue Segment Private Client Asset Management Bank 56 UBS Branches Private Client – 350 financial advisors and support Revenue production has exceeded expectations October 2009 Private Client – 75 financial advisors Public Finance December 2008 Private
Slide 18: GWM - Private Client Group Key Operating Metrics
GWM - Private Client Group Key Operating Metrics Accounts(1) Financial Advisors(1) Total Client Assets(1) ($MM) Branches(1) Excludes Legacy Sterne Agee Independent Contractor Business. * 2018 Financial Advisors, Branches, Accounts, and Total Client Assets are as of 9/30/2018
Slide 19: GWM – Stifel Bancorp, Inc.
GWM – Stifel Bancorp, Inc. Acquired FirstService Bank, a St. Louis-based, Missouri-chartered commercial bank, in April 2007 Stifel Financial became a bank holding company and financial services holding company Substantial Balance sheet growth with low-risk assets Funded by Stifel Nicolaus client dep
Slide 20: Growing Asset Management Capabilities
Growing Asset Management Capabilities Asset Management Subsidiaries with Over $31 Billion in Client Assets As of September 30, 2018. Ziegler Capital Management, LLC, 1919 Investment Counsel, LLC, Choice Financial Partners, Inc. d/b/a EquityCompass Strategies, and Washington Crossing Advisors, LLC ar
Slide 21: Institutional Group
Institutional Group STIFEL 2
Slide 22: Institutional Group Overview
Institutional Group Net Revenues ($MM)(2)(3)(4) Fixed Income Brokerage + Investment Banking (4) Overview Equity Brokerage + Investment Banking (4) Provides securities brokerage, trading, research, underwriting and corporate advisory services Largest provider of U.S. Equity Research 3rd largest Equit
Slide 23: Building Scale and Capabilities into a $1.0B Revenue Segment
Equities Fixed Income Investment Banking Building Scale and Capabilities into a $1.0B Revenue Segment Growth Focused Investment Banking, Research, Sales and Trading July 2010 Core of our Institutional sales, trading and research group December 2005 Knight Fixed Income IB, Sales and Trading, Private
Slide 24: Institutional Group – Advisory
Institutional Group – Advisory 2010-2018 YTD: Leadership in M&A of Public Companies and deals < $1bn. Public Deals < $1 Billion in Value All Deals < $1 Billion in Value All Firms Middle Market Firms Source: Dealogics M&A Analytics as of 9/28/18. Note: Includes all sell-side and buy-side strategic or
Slide 25: Institutional Group – Equity Underwriting
Institutional Group – Equity Underwriting Accomplished U.S. Equity Underwriting Franchise – All Equity Transactions Bookrun Equity Deals Since 2010 All Managed Equity Deals Since 2010 Source: Dealogic. Rank eligible SEC registered IPOs and Follow-On offerings since 2010. Includes demutualizations. A
Slide 26: Institutional Group – Research
Institutional Group – Research Largest U.S. Equity Research Platform U.S. Equity Research Coverage (1)(2) Coverage Balanced Across All Market Caps (1) Stifel Research Highlights Largest provider of U.S. Equity Research Largest provider of U.S. Small Cap Research² #1 U.S. provider of Financial Servic
Slide 27: Institutional Group – Equity Sales and Trading
Institutional Group – Equity Sales and Trading Powerful Platform Spanning North America and Europe Institutional Equity Sales Equity Trading Extensive Distribution Network Relationships with over 3,500 institutional accounts globally Active daily market maker in over 4,300 stocks Traded over 6.7 bil
Slide 28: Institutional Group – Fixed Income Capital Markets
Institutional Group – Fixed Income Capital Markets Strong Fixed Income Brokerage Capabilities Overview Client Distribution (1)(2) Platform & Products Comprehensive platform 85 traders with annual client trade volume approaching $500 billion 45-person Fixed Income Research and Strategy Group Widespre
Slide 29: Institutional Group – Public Finance
Institutional Group – Public Finance Overview Stifel has ranked in the top ten nationally for senior managed negotiated underwritings for the past five years, and Stifel has ranked #1 nationally for senior managed K-12 negotiated underwritings for 2016 & 2017. Stifel’s Public Finance Group ranked #1
Slide 30: Guidance & Third Quarter Review
Guidance & Third Quarter Review
Slide 31: Fourth Quarter 2018 & Initial 2019 Outlook
Fourth Quarter 2018 & Initial 2019 Outlook * All dollar amounts and ratios are non-GAAP * * 4Q18 & annual Non-Compensation ranges exclude loan loss provision expense and investment banking gross ups.
Slide 32: Highlights & Third Quarter Results
Highlights & Third Quarter Results Non-GAAP Net Revenue of $738 million, up 2% Y/Y. Record Asset Management & Services Fees of $201 million, up 12% Y/Y. Record Net Interest Income of $121 million, up 21% Y/Y. Non-GAAP Comp. Ratio of 56.5%, down 460 bps Y/Y Non-GAAP Pre-tax Margin of 20.6%, up 380 bp
Slide 33: Segment Results
Segment Results STIFEL 23
Slide 34: Global Wealth Management
Global Wealth Management GWM Net Revenue YY Sequenti $500 mi 3Q18 Change Change 2018 Change 5400 [total Wealth Management Revenue = commissions sis 2% 0% =| $355 0% 38300 Ping Fansactns st 4 om | st26 sat sooo ctaage sis ow | samt os bcc cetrpre Seen sot ize | tet etre sar 2am aw | art 20% so “45 3%
Slide 35: Institutional Group
Institutional Group WY Sequer 3Q18 Change Change 2018 Change Equity toe sa am om | e250 108 niyctavintasnisomne steak | Sestem se income vty som sn | 08 ieteeg sama | seam jomiboorecxitntesttsowme set 2am amu [sain atm tie jt $246 7% 3% $769 1% 25% Contribution $80 lcomp. Ratio 59.4% -60bps 10bps |
Slide 36: Revenue & Expenses
Revenue & Expenses STIFEL
Slide 37: Brokerage Revenue and Asset Management & Service Fees
Brokerage Revenue and Asset Management & Service Fees * Sum of Global Wealth Management Brokerage Revenue and Asset Management & Service Fees
Slide 38: Investment Banking Revenue
Investment Banking Revenue Investment banking: ‘Three Months Ended (000: YD 318 — 3Q17 —%Change 2018 %Change} 2018 2017 _% Chango Copital raising: Gobal Wealth Management revenue $7722 $9072 15% © $7968 ~=—-3% || $23,378 © $31567 26% Equity Capital Markets 65000 43277 «50% += 44087 «47%|| 161793 124
Slide 39: Net Interest Income
Net Interest Income *Yields for Average Assets & Liabilities include the impact of Financial Instruments Owned, Stock Loan, Stifel Capital Trusts, Cash and Other. **Net interest margin in historical periods reflect impact of reverse repos
Slide 40: Stifel Bancorp, Inc
Stifel Bancorp, Inc (til. except for %'s) As: ts: Mortgage Loans 2792 2518] 11% | 2704) 3% ‘Commercial Loans 3127 2880) 31% | 2677| 17% ‘Securities Based Loans 1836 © 1840] 0% | 1846| 4% (Commercid Peal Estate 329 79 | 316% 127 | 159% LoanstHld for Sale 262 166 | 58% 211] 24% Total Loans, net $3516
Slide 41: Expenses
Expenses * For reconciliation of GAAP to non-GAAP expenses, refer to our second quarter 2018 earnings release.
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