Vantagesouth Bancshares — Gulf South Conference (May 2014)
25 slides from Vantagesouth Bancshares's conference presentation, May 12, 2014
Slide 1: Gulf South Conference Presentation May 13, 2014
Gulf South Conference Presentation May 13, 2014
Slide 2: Important information: Forward Looking Statements
Important information 2 Forward Looking Statements Information in this presentation contains forward-looking statements with the meaning of the Private Securities Litigation Reform Act of 1995. These statements involve risks and uncertainties that could cause actual results to differ materially. Van
Slide 3: Executive summary
Executive summary 3 VantageSouth: Improving efficiency, strong SBA, improving credit Yadkin: Good loan growth, expanding margin, improving credit Merger integration remains on track Unique revenue drivers for combined company Complementary business models drive synergy opportunity
Slide 4: VantageSouth quarterly operating trends
VantageSouth quarterly operating trends 4 Core Pre-Tax, Pre-Provision Earnings* ($000) Operating Efficiency Ratio* (%) Loan Production ($mm) Tangible Book Value per Share $1,248 $5,981 $6,238 $6,840 $7,130 $0 $2,000 $4,000 $6,000 $8,000 Q1 2013 Q2 2013 Q3 2013 Q4 2013 Q1 2014 *Excludes gain on acqui
Slide 5: VantageSouth earnings profile
VantageSouth earnings profile 5 Core pre-tax, pre-provision earnings of $7.1mm • Continues positive trend since ECB merger completion Record SBA quarter with $2.3mm of fee income, up from $1.9mm in Q4 Cost reductions continue to positively impact NIE and efficiency ratio • Operating efficiency
Slide 6: VantageSouth balance sheet
VantageSouth balance sheet 6 Total assets decreased $13mm during Q1 to $2.1bn driven by: • Loan balances declined by $4.5mm, including: $16.9mm in SBA loan sales $24mm decline in agricultural lending as a result of seasonality and increased competition • Deposits declined $17.4mm during Q1 aft
Slide 7: Yadkin quarterly operating trends
Yadkin quarterly operating trends 7 Core Pre-Tax, Pre-Provision Earnings* ($000) Operating Efficiency Ratio* (%) Net Interest Margin Tangible Book Value per Share $7,491 $6,817 $6,958 $6,889 $6,331 $0 $2,500 $5,000 $7,500 $10,000 Q1 2013 Q2 2013 Q3 2013 Q4 2013 Q1 2014 *Excludes gain on acquisition,
Slide 8: Yadkin earnings profile
Yadkin earnings profile 8 *Excludes gain on acquisition, realized securities gains and losses, and merger and conversion costs c For the Quarter Ended, ($ in thousands) 2013Q1 2013Q2 2013Q3 2013Q4 2014Q1 Net interest income 15,052$ 16,121$ 16,136$ 16,749$ 16,603$ Provision for loan losses 237 55 40
Slide 9: Yadkin balance sheet
Yadkin balance sheet 9 ($ in thousands) 2013Q4 2014Q1 Assets: Cash and due from banks 32,226 32,254 Fed funds & interest bearing deposits 8,769 29,264 Investment securities 288,922 267,093 Loans held for sale 18,913 6,962 Loans, net of unearned income 1,358,746 1,382,698 Less: Allowance for loan los
Slide 10: Pending merger between VantageSouth and Yadkin
Stanly Cabarrus Vance Richmond Anson Barnwell Greenwood Columbus Lenoir Wayne Cleveland Rutherford Sampson Richland Halifax Alleghany Mitchell Avery McDowell McCormick Transylvania Martin Jackson Cherokee Graham Swain Haywood Hertford Northampton Dorchester Bamberg Jaser Charleston Colleton Allendal
Slide 11: Unique revenue drivers of combined company
Unique revenue drivers of combined company 11 $14,703 $17,024 $37,368 $21,534 $30,741 $33,970 $44,404 $53,935 $61,080 $63,594 $0 $17,500 $35,000 $52,500 $70,000 $0 $12,500 $25,000 $37,500 $50,000 Q1 2013 Q2 2013 Q3 2013 Q4 2013 Q1 2014 Q u a rte r E n d L o a n B a la n c e L o a n P ro d u ct io n
Slide 12: Appendix
APPENDIX 12
Slide 13: VantageSouth net interest income
VantageSouth net interest income 13 GAAP Yield, Cost and Net Interest Margin (%) 0.76 0.51 0.59 0.69 0.69 4.91 5.12 4.90 4.91 4.80 4.24 4.67 4.39 4.31 4.19 0.00 1.50 3.00 4.50 6.00 Q1 2013 Q2 2013 Q3 2013 Q4 2013 Q1 2014 Cost of Interest-Bearing Liabilities Yield on Earning Assets NIM Net interest
Slide 14: Diverse drivers of VantageSouth noninterest income growth
Diverse drivers of VantageSouth noninterest income growth 14 Noninterest Income Composition* ($000) *Excludes gain on acquisition and realized securities gains and losses $345 $1,052 $1,190 $794 $693 $515 $1,525 $1,512 $1,407 $1,315 $391 $1,096 $310 $468 $318 $1,119 $1,058 $1,525 $1,884 $2,341 $0 $1
Slide 15: VantageSouth builder finance overview
VantageSouth builder finance overview 15 *Active Loan Summary and Portfolio Footprint includes original commitment balances for unpaid notes issued through 3/31/2014 as tracked by the business unit. Portfolio balance trend (Balance Sheet) includes deferred loan fees. Builder Finance Active Loan Summ
Slide 16: VantageSouth noninterest expense
$2,884 $4,687 $4,569 $4,376 $4,006 $644 $1,075 $1,105 $1,096 $1,030 $1,547 $2,408 $2,497 $2,600 $2,636 $5,991 $11,009 $10,034 $9,452 $9,014 $0 $4,000 $8,000 $12,000 $16,000 $20,000 Q1 2013 Q2 2013 Q3 2013 Q4 2013 Q1 2014 Non-Interest Expense Composition* ($000) VantageSouth noninterest expense 16
Slide 17: VantageSouth asset quality data
VantageSouth asset quality data 17 Provision for loan losses totaled $1.3mm Effective reserve, including ALLL and loan marks, is 2.54% of total loans Effective reserve on non-PCI loans (excluding interest rate mark) was 1.15% of loans in 1Q14, which represents an approximately 1-for-1 reserve
Slide 18: VantageSouth capital
VantageSouth capital 18 11.2% 8.3% 8.3% 8.5% 8.5% 13.3% 10.3% 9.8% 9.9% 10.1% 14.7% 11.2% 13.0% 13.0% 13.2% 6.0% 8.0% 10.0% 12.0% 14.0% 16.0% Q1 2013 Q2 2013 Q3 2013 Q4 2013 Q1 2014 Tier 1 leverage ratio Tier 1 risk-based capital ratio Total risk-based capital ratio VantageSouth Bancshares Capital R
Slide 19: Yadkin net interest income
Yadkin net interest income 19 GAAP Yield, Cost and Net Interest Margin (%) 0.91 0.73 0.69 0.64 0.63 4.31 4.50 4.48 4.45 4.52 3.57 3.90 3.93 4.04 4.11 0.00 1.50 3.00 4.50 6.00 Q1 2013 Q2 2013 Q3 2013 Q4 2013 Q1 2014 Cost of Interest-Bearing Liabilities Yield on Earning Assets NIM For the Quarter Ende
Slide 20: Yadkin mortgage overview
Yadkin mortgage overview 20 Mortgage Banking Production Summary Mortgage Banking Revenue* Mortgage Loan Officers 25 Retail MLOs (standalone production officers) 14 In-branch MLOs 9.4 loans closed per month per FTE in 2013 ($ in thousands) 2013Q1 2013Q2 2013Q3 2013Q4 2014Q1 Loans Funded ($) 69,
Slide 21: Yadkin asset quality data
Yadkin asset quality data 21 Provision for (recover of) loan losses totaled ($460,000) Allowance for loan loss to total loans is 1.19% Nonperforming assets to total assets is down to 0.99% Adversely classified assets to Tier 1 capital and loan loss reserve ratio has continued to exceed expec
Slide 22: Pro forma loans & deposits
Pro forma loans & deposits 22 VantageSouth Bancshares Yadkin Financial Corporation (1) Pro Forma (1) Source: Company documents (1) Does not include purchase accounting adjustments C&D 9.0% Residential RE 13.5% Multifamily 4.5% Home Equity 13.9% Non- Owner Occ. CRE 14.6% Owner Occ. CRE 25.3% C&I 16.0
Slide 23: Comparable group trading analysis
1.37x 1.57x 1.68x 1.81x 1.90x 1.94x 2.07x 2.23x 2.28x 2.43x 2.44x 3.39x 3.59x UCBI VSB YDKN UBSH SFNC WSBC CHCO UBSI RNST SCBT PNFP OZRK HOMB Comparable group trading analysis 23 12.3x 12.4x 12.5x 12.6x 12.9x 12.9x 13.2x 13.4x 14.2x 15.0x 15.6x 18.0x WSBC YDKN SFNC CHCO UBSH SCBT UCBI RNST UBSI PNFP
Slide 24: Additional information about the merger and where to find it
Additional information about the merger and where to find it 24 In connection with the proposed merger, Yadkin has filed with the SEC a Registration Statement on Form S-4 that includes a joint proxy statement of Yadkin and VantageSouth and a prospectus of Yadkin, as well as other relevant documents
Slide 25: Gulf South Conference Presentation Contact
Gulf South Conference Presentation Contact: Terry Earley (919) 659-9015 terry.earley@vsb.com
VantageSouth Bancshares — Gulf South Conference (May 2014) on 6ix