Beacon Financial Corporation · NYSE:BBT
Beacon Financial — Berkshire Hills Bancorp — KBW Community Bank Investor Conference 2010
19 slides from Beacon Financial's conference presentation, Jul 27, 2010
Slide 1: KBW Community Bank Investor Conference - July 26-28, 2010
BERKSHIREHILESBANCORP www. JoinTheExcitement.com KBW Community Bank Investor Conference - July 26 - 28, 2010
Slide 2: Presenters
Kevin P. Riley Sean A. Gi se President, CFO Executive Richard M. Marotta Executive Vice Presi i Executive Vice Presiden Michael P. Daly President and CEO David H. Gonei lent, CRO Investor Relations Officer
Slide 3: Why Invest in Berkshire Hills Bancorp?
Why Invest in Berkshire Hills Bancorp? Strong growth from organic, de novo, product .... and acquisition strategies \ i Solid capital, core funding and risk management culture Experienced executive team focused on earnings and shareholder value Distinctive brand and culture as America’s Most Excitin
Slide 4: Our Growing Regional Franchise
Our Growing Regional Franchise $2.7 billion in assets; 45 financial centers Total revenues $100+ million Massachusetts, New York and Vermont Largest local regional bank Diversified revenues (fees~30%) Integrated insurance and wealth management ($650 million AUM) Strong commercial platform New Englan
Slide 5: Recruited Experienced Leadership Team
Recruited Experienced Leadership Team ichael P. Daly President and CEO. Kevin Riley CFO Michael O , Commercial snort EVP, Risk Richard Marota Management Background KeyBank Background Background qDeanknon KeyBank Co-Regenal Group Head Robert Curley
Slide 6: America's Most Exciting Bank: Attractive Markets
America’s Most Exciting Bank Attractive Markets Berkshire County and Vermont = Worlds’ Top Destinations Rated #5 (Vermont) and #7 (Berkshire) in the world by National Geographic Traveler (December 2009) Ratings based on environment, culture, history, aesthetic appeal, tourism and outlook New York's
Slide 7: America's Most Exciting Bank: Distinctive Brand and Culture
America’s Most Exciting Bank Distinctive Brand and Culture THE Vision RIGHT WAY “To excel as a high performing market leader with the right people, attitude and energy providing an engaging and exciting customer and team member experience.” Respect Integrity Guts l Having Fun People, Attitude, Energ
Slide 8: America's Most Exciting Bank
“America’s Most Exciting Bank ™ America’s Most Exciting Bank University New Branch Design AMEB] [BERKSHIRE HILLS BA\ "won berkshirebank.com,
Slide 9: Recent Initiatives
Recent Initiatives Strong organic business development Gaining share from national competitors Strengthening regional teams © New York leadership © Springfield headquarters opening, new retail platform New business lines » New England asset based lending group - premier team © Springfield private ba
Slide 10: Solid Second Quarter Results
Solid Second Quarter Results 46% growth in net income 67% growth in core EPS 55% annualized growth in seasonally adjusted EPS compared to linked quarter 12% growth in core revenue 13% growth in net interest income; 18% growth in fee income 3.25% net interest margin, compared to 2.91% in the prior ye
Slide 11: 2010 Objectives for Growth and Earnings
2010 Objectives for Growth and Earnings Core EPS $0.95 - $1.00 target for 2010 Pre-tax pre-provision profit of ~ $27 million up 30%+ from $20 million in 2009. Absorbing nearly $2 million net costs of new businesses and branches Ongoing organic growth in all business lines - 9% total revenue growth T
Slide 12: Asset Quality
Asset Quality Q4, 2009 Loan Initiative © Loan level scrub of all classified commercial loans and other stressed credits ° Most classified loans paying current - addressed issues before they impacted performance © Strategies to reduce risk — bifurcations, modifications, outplacements, loan sales Curr
Slide 13: Loan Mix Managed for Growth
Loan Mix Managed for iia Growth Plan to grow C & 1 feats new asset based feces group Indirect auto running off in - no high LTV or sub-p! Alt Aloan programs Alllending is to relationships in Berkshire’s and New York I 2007 2008 2009 rer tg CBI Residential Consane] Note: Oatasesefpeod end
Slide 14: Diversified Commercial Loan Exposure
Diversified Commercial Loan Exposure No loans to out of area relationships i i of total loans Total Commercial Loans = $1.1 Billion As of June 30, 2010 (CRE Owner Occupied Other CRE Non Owner me Occupied 36% ‘Commercial & Industrial (Including ABL) 28% Residential Construction Commercial Real Estate
Slide 15: EPS Growth Targets Beyond 2010
EPS Growth Targets Beyond 2010 $1.00+ 2010 run rate $0.20+ from margin benefit of 200 basis point rate increase $0.30+ from 8%+ volume growth in 2011 $0.30+ from 8%+ volume growth in 2012 $0.10+ from insurance, wealth management and other $0.10 from lower loss provision as charge-offs normalize $2.0
Slide 16: M&A Objectives
M &A Objectives ¢ Utilize strong combination of management, brand and culture to develop market share in attractive Northeast markets Target deal metrics ° EPS accretion ° Any dilution of TVPS accreted back through earnings in five years © Double digit ROI ° Mostly stock consideration — surviving cu
Slide 17: BHLB - On the Move for Attractive Investment Returns
Barkstike HittsBANGORP BHLB - On the Move for Attractive Investment Returns Clean balance sheet and improving asset metrics © Strong capital and liquidity « Positioned to take advantage of the stronger economy and higher rates we think are coming our way Talented and focused management team « New st
Slide 18: Financial Performance and Goals
“America’s Most Exciting Bank ™ ancial Performance and Goals Exhibit A Ahead of plan in at mid-year 2010 (sane 6mo | Guidance | Financial 2007 | 2008 | 2009 | 2010 2010 Goals Revenue growth 23% | 21%] -8%6 Wh 9% 10% Net interest margin 3.26% | 3.44%] 3.00%] 3.24% 3.23%] 3.50% Fee income/Total revenu
Slide 19: Diversified Revenues and Regional Presence
Diversified Revenues and Regional Presence exhibits Target record revenues of $107 million in 2010 Diversified Revenues Banking Fees % = Insurance 32% Expanding Regional Presence Net interest Income New York 70% Berkshire Vermont County 4% 43% Springfield a Bank Revenue Mix
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