Peapack-gladstone Financial Corporation · NASDAQ:PGC
Peapack-gladstone Financial — Investor Presentation (April 2018)
32 slides from Peapack-gladstone Financial's investor presentation, Apr 30, 2018
Slide 1: Investor Presentation: Expanding Our Reach
Investor Presentation “Expanding Our Reach” March 31, 2018 P EAPACK - G LADSTONE B ANK
Slide 2: Statement Regarding Forward-Looking Information
Statement Regarding Forward - Looking Information 2 This report contains forward - looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Suc h statements are not historical facts and include expressions about Management’s strategies and Management’s expectati
Slide 3: Investment Considerations
• Regionally focused private banking model providing comprehensive wealth management and commercial banking solutions throughout the desirable New Jersey and metro New York region. • High touch private banking business model launched in 2013 focuses on helping clients create, grow, protect, and tran
Slide 4: PGC's Current Valuation vs. Wealth Management Peers
[The market would imply that our stock is undervalued as PGC currently trades at lower multiples than our wealth management peers.] PGC’s Current Valuation vs. Wealth Management Peers 4 Note: Pricing data as of April 26, 2018; financial data as reported for the quarter ended March 31, 2018 (Q1 2018)
Slide 5: Franchise Overview
Financial Highlights Branch Map Franchise Overview 5 NOTE: Financial data as of 03/31/2018. Private Banking Offices Bedminster, NJ Morristown, NJ Princeton, NJ Teaneck, NJ Fairfield, NJ Gladstone, NJ Greenville, DE – Trust and Investment Office Headquarters Bedminster, NJ Year Founded 1921 Branches
Slide 6: Considerable Growth Opportunity
Considerable Growth Opportunity 6 Deposit Market Share – New Jersey Rank Institutions (ST) Branches Deposits ($mm) Market Share (%) 1 Bank of America Corp. (NC) 252 53,474 16.2 2 Toronto - Dominion Bank 246 39,843 12.1 3 Wells Fargo & Co. (CA) 286 39,268 11.9 4 PNC Financial Services Group (PA) 292
Slide 7: Affluent Market
Affluent Market 1. Rank reflects ranking amongst all New Jersey counties. Note: Weighted average is calculated as the sum of (percent of state/national franchise * demographic item) within each marke t; banks, thrifts, and savings banks included (retail branches only). Source: S&P Global Market Inte
Slide 8: Strategic Objectives and Recent Initiatives
Strategic Objectives: • Increase fee revenue mix to 35% - 45% of total revenue by expanding wealth management revenue. • Grow the loan portfolio with an eye on expanding NIM through our in - house loan profitability model. • Drive core deposit growth through relationship - based C&I and CRE, as well
Slide 9: Profitability Targets
How Do We Get There: • Wealth Management growth – organic and acquisition. • Continue migration of loan portfolio to C&I (utilizing our in - house loan profitability model). • NIM expansion. • Further efficiencies. • Tax reform. Profitability Targets 9 Profitability Metrics Year 2017 Quarter March 2
Slide 10: Private Banking Model
• Cultivate high value clients within our affluent footprint by developing, optimizing, and delivering customized financial solutions aimed at helping clients create, grow, protect, and ultimately transition wealth. • Senior Private Bankers lead a team - based approach. ‒ PGB offers a full suite of
Slide 11: Peapack Private Wealth Management
Strategy: • Wealth integrated into every client conversation . • Well - defined culture for continuous improvement of the client experience. • Expanding Our Reach through strategic acquisitions in the metro New York region. • Our destination: a boutique private bank offering a differentiated client
Slide 12: Peapack Private Wealth Management
Peapack Private Wealth Management 73% 22% Wealth Fee Income 5% For Three Months Ended March 31, 2018 Total Revenue Net Interest Income before Provision Wealth Fee Income Fees & Other Fee Income Fee Income Target 35% - 45% of Revenues 12 $0.0 $1.0 $2.0 $3.0 $4.0 $5.0 $6.0 2013 2014 2015 2016 2017 Q1
Slide 13: Franchise Growth
Wealth Assets Under Administration Total Assets Total Deposits Total Loans Franchise Growth (in billions) $0.0 $1.0 $2.0 $3.0 $4.0 $5.0 2012 2013 2014 2015 2016 2017 Q1 2018 $0.0 $1.0 $2.0 $3.0 $4.0 $5.0 $6.0 2012 2013 2014 2015 2016 2017 Q1 2018 $0.0 $0.5 $1.0 $1.5 $2.0 $2.5 $3.0 $3.5 $4.0 2012 201
Slide 14: Financial Performance
Diluted Earnings per Share Net Income (in millions) ROACE ROAA Financial Performance $0.0 $10.0 $20.0 $30.0 $40.0 2013 2014 2015 2016 2017 Q1 2017 Q1 2018 $0.00 $0.50 $1.00 $1.50 $2.00 $2.50 2013 2014 2015 2016 2017 Q1 2017 Q1 2018 0.00% 2.00% 4.00% 6.00% 8.00% 10.00% 12.00% 2013 2014 2015 2016 2017
Slide 15: Positive Operating Leverage
Deposits / Branch (in millions) Efficiency Ratio 1 Loans / Employee (in millions) Net Income / Employee (in thousands) Positive Operating Leverage 0.0% 20.0% 40.0% 60.0% 80.0% 2013 2014 2015 2016 2017 Q1 2018 $0 $50 $100 $150 $200 2013 2014 2015 2016 2017 Q1 2018 $0.0 $2.0 $4.0 $6.0 $8.0 $10.0 $12.0
Slide 16: Loan Portfolio Transformation
Note: Gross loans include loans held for sale. Loan Portfolio Transformation 16 MFL 36.8% Target 20% - 30% CRE 17.3% Target 15% - 20% C&I 26.9% Target 35% - 45% Resi / Cons 19.0% Target 15% - 20% Resi / Cons 52.6% C&I 10.0% CRE 22.4% MFL 14.0% Loan Mix As of March 31, 2018 Loan Mix As of December 31
Slide 17: Commercial & Industrial Overview
• C&I loans have grown significantly since 2013. • Newly formed Professional Services Group, targeting loans and deposits, led by a seasoned executive. • Target C&I 35% - 45% of total loans. • Relationship based C&I lending to assist in driving low - cost core deposit generation. • State - of - the
Slide 18: Multifamily Overview
• Currently targeting a reduced multifamily composition equal to 20% - 30% of total loans. • Geographically diverse portfolio: – 53% New York – 34% New Jersey – 13% Pennsylvania • Focused on “workforce housing” with below market average rents. – 67% rent regulated • Average loan size: $3.0MM • Weigh
Slide 19: Strong Credit Quality
30 - 89 Day Delinquency Over Loans NPAs / Assets Reserves / Gross Loans NCOs / Average Loans Strong Credit Quality 0.0% 0.2% 0.4% 0.6% 0.8% 1.0% 2012 2013 2014 2015 2016 2017 Q1 2018 0.00% 0.05% 0.10% 0.15% 0.20% 0.25% 0.30% 0.35% 2012 2013 2014 2015 2016 2017 Q1 2018 19 0.00% 0.20% 0.40% 0.60% 0.80
Slide 20: Deposit Mix
Deposits NOW & Other Trans Accts 35.8% Demand Deposits 15.1% MMDA & Other Savings 31.9% Time 17.2% Deposit Mix As of March 31, 2018 20 $0 $1,000 $2,000 $3,000 $4,000 2012 2013 2014 2015 2016 2017 Q1 2018 Total Deposits (in millions) Cost of Total Deposits (including Non - Int Bearing) 0.00% 0.20% 0.
Slide 21: Tangible Book Value Per Share
Tangible Book Value Per Share $10.00 $12.00 $14.00 $16.00 $18.00 $20.00 $22.00 2012 2013 2014 2015 2016 2017 Q1 2018 $14.43 $13.62 $18.60 21 $15.95 $16.95 $20.40 $21.07
Slide 22: Appendix
Appendix P EAPACK - G LADSTONE B ANK
Slide 23: Management Team
Douglas L. Kennedy President & Chief Executive Officer 908.719.6554 40 years experience; Before joining in 2012 , he served as President of the NJ Market for Capital One Bank . He has held key executive level positions and had great success building formidable regional and national specialty banking
Slide 24: Management Team
Anthony V. Bilotta , Jr. Executive Vice President, Head of Retail Banking 908.306.4266 30 years experience; Prior to joining in 2013 , he served as SVP and Director of Retail Banking & Corporate Marketing at Oritani Bank, and prior to that, he was EVP, Director of Retail Banking at New York Communit
Slide 25: Management Team
Brydget Falk - Drigan Executive Vice President, Chief Human Resources Officer 908.719.3315 27 years experience; Prior to joining in 2018, she served as Leader, Global Talent Solutions and People Operations, Leader, Global Talent Acquisition, and Leader, Employee Engagement and Internal Communication
Slide 26: Management Team
Kevin Runyon Executive Vice President, Chief Information Officer 908.806.3060 34 years experience; Prior to joining in 2014 , he served as Managing Director of All Covered, a Division of Konica Minolta in Cherry Hill, NJ, where he was responsible for the delivery of technology and IT compliance - re
Slide 27: Board of Directors: Tony Spinelli
Tony Spinelli Tony Spinelli was named to the Board of Directors in May of 2017. Mr. Spinelli maintains Certified Information Systems Security Professional (CISSP) accreditation and serves on the boards of Per Scholas , the US Department of Defense and Georgia Tech Institute for Information Security
Slide 28: Capital, Liquidity, & Interest Rate Risk Management
Balance sheet risk management includes stress testing: • Capital – Quarterly stress testing (top down/bottom up). – Remain well - capitalized under our stress scenarios. • Liquidity (as of March 31, 2018) – $501 million in cash and cash equivalents and securities designated as available for sale. –
Slide 29: Quarterly Income Statement Summary
Quarterly Income Statement Summary (Dollars in thousands, except per share data) 29 1. Efficiency Ratio calculated by dividing total noninterest expense, by net interest income and total noninterest income. Income Statement Data: 3/31/2018 12/31/2017 9/30/2017 6/30/2017 3/31/2017 Net interest income
Slide 30: Capital Summary
Capital Summary 30 1. Tangible equity as a percentage of tangible assets at period end is calculated by dividing tangible equity by tangible ass ets at period end. See non - GAAP financial measures reconciliation on page 31. 2. Tangible book value per share is calculated by dividing tangible equity
Slide 31: Non-GAAP Financial Measures Reconciliation
Non - GAAP Financial Measures Reconciliation (Dollars in thousands, except per share data) 31 We believe that these non - GAAP financial measures provide information that is important to investors and that is useful in under standing our financial position, results and ratios. Our management interna
Slide 32: Contacts
Peapack - Gladstone Financial Corporation 500 Hills Drive, Suite 300 P.O. Box 700 Bedminster, New Jersey 07921 (908) 234 - 0700 www.pgbank.com Douglas L. Kennedy President & Chief Executive Officer (908) 719 - 6554 dkennedy@pgbank.com Jeffrey J. Carfora Senior EVP & Chief Financial Officer (908) 719
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