Bar Harbor Bankshares, Inc. · AMEX:BHB
Bar Harbor Bankshares — Q3 2020 Earnings Presentation
23 slides from Bar Harbor Bankshares's earnings presentation, Nov 10, 2020
Slide 1: Third Quarter 2020 Earnings Presentation
Third Quarter 2020 Earnings Presentation November 10, 2020
Slide 2: Company Overview
Company Overview (NYSE American: BHB) Financial Highlights Asset and Income Generation Market Data1 Total Assets (MM's) Stock Price $20.42 $3,860 Market Cap (MM's) $305 Price / LTM Core EPS 9.37x $3,780 Price / Tangible Book Value (Non GAAP) 110% Dividend Yield 4.28% $3,669 $3,677 Balance Sheet (MM)
Slide 3: Third Quarter 2020 Highlights
Third Quarter 2020 ‐ Highlights • 13% annualized growth in total commercial loans • 36% annualized increase in total deposits • 92% loan to deposit ratio • 2.98% NIM, an increase of 23bp from Q3 2019 • 32% increase in non‐interest income Y‐o‐Y • 0.56% non‐accruing loans to total loans, excluding PPP
Slide 4: Strategic Objectives
Strategic Objectives We strive to be one of the most profitable banks in New England; to provide exceptional service to the people, businesses and communities we serve; and create a corporate culture that develops and rewards existing employees and attracts outside talent. To be one of the most prof
Slide 5: Management Team
Management Team Executive Background Curtis C. Simard • Joined as President and CEO of Bar Harbor Bankshares and Bar Harbor Bank & Trust in June 2013 President and CEO • Served as Managing Director of Corporate Banking for TD Bank and various management positions at Citizens Financial Group • Joined
Slide 6: Company History
Company History Acqui sition of Further Expansion Conti nue to La ke Sunapee John Merci er i nto Southern NH opportunistically Ba nk group – hi red to run pos ition Balance Sheet expa nsion into NH commercial Ba r Ha rbor Trust Acqui red Border Ma ri on Colombo Executed on branch Ri ck Ma ltz hired
Slide 7: Markets we Serve: Deposit Market Share
Markets we Serve: Deposit Market Share Maine Total Total Deposits Market Rank Financial Institution Name Branches (000's) Share 1 Toronto‐Dominion Bank 42 $3,867,684 10.1% 2 Camden National Corporation 58 $3,581,756 9.4% 3 Bangor Bancorp, MHC 59 $3,488,716 9.1% 4 KeyCorp 42 $2,833,196 7.4% 5 Bank of
Slide 8: Quarterly Profitability Metrics
Quarterly Profitability Metrics Core ROAA Core ROAE 8.81% 8.98% 8.52% 0.96% 0.96% 7.71% 0.91% 7.36% 0.86% 0.80% 2019Q3 2019Q4 2020Q1 2020Q2 2020Q3 2019Q3 2019Q4 2020Q1 2020Q2 2020Q3 Net Interest Margin Efficiency Ratio 3.06% 65.02% 64.82% 3.00% 2.98% 2.95% 62.56% 60.67% 2.75% 59.47% 2019Q3 2019Q4 20
Slide 9: Strengthening of the Balance Sheet
Strengthening of the Balance Sheet Liquidity • Increased balance sheet liquidity reflecting significant wholesale borrowing capacity (FHLB and Brokered CD Market) as well as restructured investment portfolio • Continue to maintain and test external lines of credit with FHLB, Federal Reserve Bank, an
Slide 10: Focus on Non-Interest Income Growth
Focus on Non‐Interest Income Growth • Optimized existing sources and executed 28.1% Total Non‐Interest Income as a against new initiatives to create other sources percentage of Total Core Revenue ‒ Substantial growth and diversification of non‐interest income YTD compared $28.2 MM Total Non‐Interest
Slide 11: Deposit Portfolio Overview
Deposit Portfolio Overview $2,935 Total Deposits 3,000.0 3,000.0 $2,696 $2,651 $2,695 $2,494 13% Money Market 2,500.0 14% 15% 15% 2,500.0 14% 17% Savings 14% Deposits in Millions ($) 16% 17% 2,000.0 2,000.0 14% 18% Demand 15% 15% 15% 19% 1,500.0 1,500.0 21% 24% 20% 22% NOW 24% 1,000.0 1,000.0 500.0
Slide 12: Loan Portfolio Overview
Loan Portfolio Overview • Total loans of $2.71 billion as of September 30, 2020 representing a 5.1% Y‐o‐Y increase, with commercial loans increasing by 13.0% quarter to date annualized ‒ Excluding PPP loans1, total loans increased 0.7% with commercial loans increasing 13.7% quarter over quarter annu
Slide 13: Update on PPP and Loan Provisions
Update on PPP and Loan Provisions Paycheck Protection Program Loans (PPP) $10 2020 Q3 • Originated approximately 1,900 loans with a total principal balance of $131.6 MM and unearned fees of $5.3 MM Allowance for $9 Loan Losses by Commercial Real Estate • $1.5 MM of fee accretion YTD, with $3.8 MM of
Slide 14: Focused on Credit Quality
Focused on Credit Quality • During Q3 2020, in response to COVID‐19, Management continued stress Total delinquent loans testing of the commercial portfolio analyzing potentially vulnerable NAICS codes and characteristics. The following segments were reviewed during $25.0 MM 25,000.0 the test: 1.7% %
Slide 15: Asset Quality
Asset Quality NCOs / Avg. Loans NPAs / Assets1 0.50% 1.20% 0.40% 1.00% 0.80% 0.30% 0.53% 0.60% 0.18% 0.20% 0.43% 0.42% 0.38% 0.33% 0.40% 0.08% 0.06% 0.10% 0.20% 0.02% 0.02% 0.00% 0.00% 2019Q3 2019Q4 2020Q1 2020Q2 2020Q3 2019Q3 2019Q4 2020Q1 2020Q2 2020Q3 Reserves / Loans2 NPLs / Loans3 1.20% 1.20% 1
Slide 16: Well Capitalized Institution
Well Capitalized Institution Tier 1 Leverage Ratio Common Equity Tier 1 Tier 1 Risk Based Capital TCE / TA 14% 13.6% 13.6% 13.4% 13.3% 12% 11.4% 11.4% 11.2% 11.1% 10.6% 10% 10.6% 10.4% 10.3% 8% 8.3% 8.1% 8.1% 8.1% 7.8% 7.6% 7.6% 7.4% 6% 4% 2% 0% 2019Q4 2020Q1 2020Q2 2020Q3 Source: Company filings, c
Slide 17: Investment Considerations
Investment Considerations • Focused on building franchise value • Deep and talented management team • Team, platform and strategy in place to generate efficient growth • Profitable and efficient business model • Clear vision to grow core loan/deposit business • Development and expansion of non‐inter
Slide 18: Legal Disclaimer
Legal Disclaimer Forward Looking Statements This presentation contains “forward‐looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward‐looking statements can be identified by words such as “believes,” “anticipates,” “expects,” “intends,” “targeted,” “
Slide 19: Appendix
Appendix
Slide 20: Historical Financial Performance
Historical Financial Performance Dollar values in thousands, except per share For the Year Ended, For the Quarter Ended, amounts or otherwise noted 2016Y 2017Y 2018Y 2019Y 2019Q3 2019Q4 2020Q1 2020Q2 2020Q3 Balance Sheet Total Assets $1,755 $3,565 $3,608 $3,669 $3,612 $3,669 $3,677 $3,780 $3,860 Net
Slide 21: Non-GAAP to GAAP Reconciliations
Non‐GAAP to GAAP Reconciliations Dollar values in thousands, except per share 2019Q3 2019Q4 2020Q1 2020Q2 2020Q3 YTD 2020 amounts or otherwise noted GAAP net i ncome 5,015 4,207 7,721 8,481 8,402 24,604 Pl us (l es s ): Ga i n s a l e of s ecuri ti es , net (157) (80) (135) (1,351) ‐ (1,486) (Gai n)
Slide 22: Non-GAAP to GAAP Reconciliations (continued)
Non‐GAAP to GAAP Reconciliations (continued) Dollar values in thousands, except per share 2019Q3 2019Q4 2020Q1 2020Q2 2020Q3 YTD 2020 amounts or otherwise noted Averages Tota l a vera ge ea rni ng a s s ets (E) $3,308 $3,309 $3,306 $3,367 $3,352 $3,339 Tota l a vera ge a s s ets (F) 3,642 3,655 3,66
Slide 23: Interest Rate Risk Analysis
Interest Rate Risk Analysis On a quarterly basis, the company measures and reports NII and EVE at risk to isolate the change in income and value related solely to interest‐earning assets and interest‐bearing liabilities. The NII analysis below shows the impact of instantaneous parallel shifts in the
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