Kearny Financial · NASDAQ:KRNY
Kearny Financial — Shareholder Meeting (October 2019)
21 slides from Kearny Financial's shareholder meeting presentation, Oct 24, 2019
Slide 1: Annual Meeting October 2019
Annual Meeting NASDAQ: KRNY October 2019
Slide 2: Forward Looking Statements
Forward Looking Statements This Kearny presentation Financial Corp. may include (the “Company”) certain “forward pursuant -looking to the statements,” “safe harbor” which provisions are made of the in Private good faith by Securities Litigation Reform Act of 1995. These Company’s forward plans, -loo
Slide 3: Kearny Financial Corp
Kearny Financial Corp (dollars in millions) as of June 30, 2019 Total Assets $6,634.8 Total Deposits $4,147.6 Total Loans (Incl. Loans HFS) $4,657.9 Corporate Headquarters Fairfield, NJ Branches 48 Market Capitalization¹ $1,122.2 Founded in 1884 6th largest New Jersey-based financial institution by
Slide 4: Our culture continues to reflect our guiding principles
Our culture continues to reflect the guiding principles we are committed to fulfilling every day Performance: a strong resolve to remain true to sound, conservative practices, and superior customer service which has led to steady progress and growth throughout the years People: our significant stake
Slide 5: Investment Rationale
Investment Rationale Conservative lending practices and strong credit culture result in outstanding asset quality metrics Continually improving profitability, operating efficiency and performance metrics Investment in, and strategy built upon, technology and innovation Highly attractive market demog
Slide 6: Capital Strength
Capital Strength Robust capital levels support continued growth Second step offering allowed us to pursue organic and strategic growth opportunities Sizable public float and strong liquidity Average daily trading volume of 316,913 shares¹ Index membership Russell 2000, ABA Nasdaq Indices, Nasdaq Ban
Slide 7: Normalizing Capital Ratios
Normalizing Capital Ratios Tier 1 Leverage Ratio 30.0% 25.8% 23.9% 25.0% 20.1% 20.0% 16.2% 14.1% 15.0% 10.0% 9.3% 9.0% 9.3% 9.7% 8.9% 5.0% 0.0% 2015FY 2016FY 2017FY 2018FY 2019FY KRNY Peer Median¹ Tier 1 Risk Based Capital Ratio Total Risk-Based Capital Ratio 50.0% 47.2% 50.0% 46.5% 38.8% 40.0% 37.9
Slide 8: Improving Performance Metrics
Improving Performance Metrics Profitability1 Earnings per Share $70,000 $0.60 0.80% $60,000 0.67% $0.50 $0.46 0.70% $50,000 0.54% 0.60% $42,142 $0.40 $40,000 0.50% 0.40% 0.36% $0.30 0.32% 0.40% $0.24 $0.22 $30,000 $0.20 $0.18 $19,596 0.30% $18,603 $20,000 $15,822 0.20% $0.10 $0.06 $10,000 $5,629 0.1
Slide 9: Loan Portfolio Growth
Loan Portfolio Growth Kearny Financial Corp. Historical Loan Growth (dollars in millions) $5,000 $4,500 $4,679 $4,000 $4,501 $3,500 $3,000 $3,245 $2,500 $2,674 $2,000 $2,103 $1,500 $1,000 $500 $0 2015FY 2016FY 2017FY 2018FY 2019FY Total Loans Over $610 million in loans originated during fiscal 2019
Slide 10: Loan Portfolio Composition
Loan Portfolio Composition June 30, 2019 Loan Portfolio 1-4 Family—28.7% Multifamily—41.6% CRE—26.9% C&D—0.3% Consumer—2.2% Commercial—1.4% $4.7 billion in loans receivable, representing 70.2% of assets Emphasis on loan portfolio diversification Average loan-to-value (LTV): CRE 46.4% Multifamily 60.
Slide 11: Strong Asset Quality
Strong Asset Quality NCOs / Average Loans 0.25% 0.20% 0.16% 0.15% 0.13% 0.14% 0.11% 0.10% 0.09% 0.07% 0.08% 0.05% 0.03% 0.02% 0.01% 0.00% 2015FY 2016FY 2017FY 2018FY 2019FY KRNY Peer Median¹ Conservative underwriting standards, dedicated special assets group and prompt attention to potential problem
Slide 12: Deposits
Deposits June 30, 2019 Deposit Portfolio Noninterest bearing deposits—7.7% Interest bearing DDA—19.6% Savings and clubs—18.7% Certificates of deposit—54.0% $4.15 billion in deposits as of June 30, 2019 Consolidated 7 branches in calendar year 2019 with negligible loss in deposits Forthcoming expansi
Slide 13: Investment Securities
Investment Securities Yield on Securities 4.00% 3.07% 3.00% 2.52% 2.08% 2.19% 2.02% 2.00% 1.00% 0.00% 2015FY 2016FY 2017FY 2018FY 2019FY As of June 30, 2019, securities totaled 19.5% of assets, down from 33.8% of assets as of June 30, 2015¹ 3.07% yield on securities in FY 2019, increase of 55 basis
Slide 14: M&A History and Strategy
M&A History and Strategy Experienced acquirer and integrator, having successfully completed 6 bank acquisitions over the past 20 years Opportunistic acquisition strategy with a focus on Low premium deals Similar or complementary business models Expansion in existing or contiguous markets Cultural co
Slide 15: Strategic Focus
Strategic Focus Traditional community banking Grow and diversify loan portfolio C&I / SBA Construction Grow and diversify deposit base Leverage technology: mobile banking, online account opening, intelligent ATMs Business Relationship Officers Government banking Expanded treasury management suite Ut
Slide 16: Strategic Focus
Strategic Focus Continue to prudently manage capital via Dividends Dividends of $0.37 paid during fiscal 2019, representing an 81% payout ratio Share repurchases 31.2 million shares repurchased through 06/30/2019 M&A transactions Most recent transaction, $1.6 billion asset Clifton Bancorp, closed on
Slide 17: Digital Transformation
Digital Transformation Recent digital banking deployments Online account opening Digital wallet (Apple Pay / Google Pay) Credit score monitoring Newly redesigned mobile optimized website EnAct Customer Relationship Management (CRM) Upcoming initiatives Enhanced escrow management platform Commercial
Slide 18: 2019 Fortune Fastest Growing Companies
2019 Fortune 100 Fastest Growing Companies 17
Slide 19: Comparative Equity Performance
Comparative Equity Performance Stock Price Performance since September 20, 2013 KRNY +87.0% KRNY Peers +44.5% S&P 500 +75.0% 150% 130% 110% 90% 70% 50% 30% 10% -10% 9/20/2013 3/20/2014 9/20/2014 3/20/2015 9/20/2015 3/20/2016 9/20/2016 3/20/2017 9/20/2017 3/20/2018 9/20/2018 3/20/2019 9/20/2019 18 No
Slide 20: Peer Group Valuation Comparison
Peer Group Valuation Comparison ($ in thousands) Total Price/ Peer Company Ticker Headquarters Assets TBV ConnectOne Bancorp, Inc. CNOB Englewood Cliffs, NJ $6,109 149% Customers Bancorp, Inc. CUBI Wyomissing, PA $11,182 84% Dime Community Bancshares, Inc. DCOM Brooklyn, NY $6,498 139% First Commonw
Slide 21: Annual Meeting October 2019
Annual Meeting NASDAQ: KRNY October 2019
Kearny Financial — Shareholder Meeting (October 2019) on 6ix