Cf Bankshares Inc. · NASDAQ:CFBK
Cf Bankshares — Central Federal — IPO Roadshow (March 2012)
33 slides from Cf Bankshares's IPO roadshow presentation, Mar 2, 2012
Slide 1: Investment Overview
Investment Overview March 2012
Slide 2: Legal Disclaimer
Legal Disclaimer This Investor Presentation (“Presentation”) has been produced by Central Federal Corporation (“CFC”) solely for use at this investor presentation held in connection with the rights offering of Common Stock of CFC, and may not be reproduced or redistributed, in whole or in part, to a
Slide 3: Executive Summary
Executive Summary
Slide 4: Why Invest in a Community Bank Today? Which Community Banks Are and Will Be Successful? Why CFBK?
4 Why Invest in a Community Bank Today? Which Community Banks Are and Will Be Successful? Why CFBK? Executive Summary
Slide 5: Offering Highlights
5 Offering Highlights • Issuer: • Security Offered: • Warrants: • Proposed Offering Price: • Proposed Offering Size: • Standby Purchaser Commitment: • Aggregate Net Proceeds: • Use of Proceeds: • Financial Advisor / Information Agent: Central Federal Corporation (NASDAQ: CFBK) Common shares 1 warran
Slide 6: Changes at CFBK in the Past Two Years
6 Promoted new CEO and President in May 2010 Engaged two different independent loan review firms, and a consulting firm to assess asset quality, workout strategies, and performance Began process of reducing nonperforming assets Strengthened allowance for loan losses Re-engineered credit and workout
Slide 7: Non-Performing Assets
Non-Performing Assets 7 Improved Asset Quality ($000s) 12,265 13,234 14,066 13,053 13,024 14,566 11,850 9,522 7,650 2,000 4,000 6,000 8,000 10,000 12,000 14,000 16,000 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2009 2010 2011
Slide 8: Loan Loss Reserves / Gross Loans
Loan Loss Reserves / Gross Loans 8 Strengthened Reserves (%) 1.9 3.0 3.2 4.6 4.7 4.9 5.0 4.5 4.2 0.0 1.0 2.0 3.0 4.0 5.0 6.0 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2009 2010 2011
Slide 9: I. Why Invest in a Community Bank Today?
9 I. Why Invest in a Community Bank Today?
Slide 10: Why Invest in a Community Bank Today?
10 Major deterioration in public perception of big banks Favorable year-over-year dynamics in the real estate market and economy There are numerous attractive potential customers up for grabs, particularly small and medium-sized businesses, executives and professionals Strong business model if deriv
Slide 11: Stock Performance – Last Two Years: Public Backlash Against Big Banks
Stock Performance – Last Two Years 11 Public Backlash Against Big Banks Management believes: • • • • Source: SNL 9.4% (16.5%) S&P Bank Index Too Big To Fail List (50.0) (40.0) (30.0) (20.0) (10.0) 0.0 10.0 20.0 30.0 The financial crisis has caused a severe backlash against the country’s Too Big To F
Slide 12: Favorable Economic Trends
12 Favorable Economic Trends • Ohio has posted the fifth largest increase in jobs of all 50 states , on a year- over-year basis from December 2010, according to the Bureau of Labor Statistics • Since December 2010, Ohio has added 72,400 jobs , trailing only Texas, New York, Florida, and California.
Slide 13: Housing Market Stabilizing
Case-Shiller Home Price Index: Cleveland versus National Average Case-Shiller Percent Decline From Market Peak 13 Housing Market Stabilizing City Percent Decline Las Vegas -61.6% Phoenix -56.4% Miami -51.5% Tampa -48.0% Detroit -45.1% San Francisco -41.3% Los Angeles -40.5% San Diego -40.0% Minneapo
Slide 14: Opportunity to Attract Customers & Talent
Akron MSA Columbus MSA East Liverpool MSA 14 Opportunity to Attract Customers & Talent Source: 2011 FDIC Deposit Market Share Data 1. 2. 3. 4. 5. 1. 2. 3. 4. 5. 1. 2. 3. 4. 5. Top 5 Deposit Market Share Leaders in CFBK’s Markets
Slide 15: Valuations at Historic Lows
Historic P/TBV Multiples Historic P/E Multiples 15 Valuations at Historic Lows Price /Tangible Book and Price/LTM Earnings Multiples for SNL Bank Index
Slide 16: II. Which Community Banks Are and Will Be Successful?
II. Which Community Banks Are and Will Be Successful?
Slide 17: Which Community Banks Are and Will Be Successful?
17 Strong, experienced leadership, focused on stakeholder values and balanced risk/returns Directors and management willing to put their own money and relationships on the line Large enough to be relevant, small enough to provide exceptional service and maintain strong long term relationships and co
Slide 18: Strong, Experienced Leadership
18 Strong, Experienced Leadership Timothy T. O’Dell – Proposed Chief Executive Officer Currently the owner of the Chetwood Group, which provides advisory services to a number of privately held enterprises in construction, health care, real estate and professional services Prior to founding Chetwood
Slide 19: Strong, Experienced Leadership
19 Strong, Experienced Leadership Robert E. Hoeweler, Jr. – Proposed Chairman Chief Executive Officer of a diverse group of companies owned by the Hoeweler family, including manufacturing, communication, distribution, business services and venture capital entities Served as Vice Chairman of Winton F
Slide 20: Strong, Experienced Leadership
20 Strong, Experienced Leadership James Howard Frauenberg, II – Proposed Director Principal owner of Addison Holding, LLC which manages investments of private individuals Active in opening new franchises for two retail chains, Five Guys Burgers and Fries and Flip Flops Senior officer with Check Smar
Slide 21: Strong, Experienced Leadership
21 Strong, Experienced Leadership Eloise L. Mackus – Current Chief Executive Officer Named CEO in February 2011, after becoming Interim CEO in May 2010; will continue as General Counsel Joined CFBank in July 2003 as Senior Vice President, General Counsel and Corporate Secretary, and became Executive
Slide 22: Strong, Experienced Leadership
22 Strong, Experienced Leadership Timothy R. Fitzwater – Senior Commercial Officer Joined CFBank in June 2010 39 years of banking experience Previously worked for National City Bank (now PNC) for 36 years, rising to President of the Northeast Region Managed approximately $3 billion in assets and $1
Slide 23: Directors/Management Personally Invested
23 Directors/Management Personally Invested Existing Intended Ownership Purchase Current Directors and Executive Officers 208,323 258,500 Proposed New Directors and Executive Officers — 2,300,000 Proposed Other Standby Purchasers — 2,735,000 Current Directors and Executive Officers as well as Standb
Slide 24: Competitive Size & Community Orientation
24 Competitive Size & Community Orientation • CFBK operates four branches in three attractive markets • The Bank has approximately $265 million in assets before the growth that the recapitalized company may be able to achieve in future years. • CFBK is focused on consumers and small businesses in th
Slide 25: Market Opportunity: Unemployment Rate By County
Unemployment Rate By County – December 2011 25 Market Opportunity CFBank Locations (4)
Slide 26: Market Opportunity: Household Income and Education Level
26 Household Income ($000s) Education Level Market Opportunity Source: SNL 0% 5% 10% 15% 20% 25% 30% 35% 40% Did Not Complete High School High School Diploma Some College Associate Degree Bachelors Degree Graduate Degree Fairlawn Worthington Ohio United States 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% <
Slide 27: SUMMA KENT STATE
v SUMMA KENT STATE 8 Health System VICTORIA'S SECRET V7 AMERICAN’ ELECTRIC POWER
Slide 28: Capital to Take Advantage of Opportunities For Growth
28 Well CFBank CFBank Peer Capitalized Regulatory Capital Ratios 9/30/11 Pro Forma Medians (a) Requirement Tier 1 Capital to Tangible Assets (Leverage Ratio) 5.55% 10.16% 9.56% 5.00% Tier 1 Capital to Risk Weighted Assets 9.13% 16.98% 14.29% 6.00% Total Risk-Based Capital to Risk Weighted Assets 10.
Slide 29: III. Why CFBK?
III. Why CFBK?
Slide 30: Solid Platform for Quality Growth
30 Solid Platform for Quality Growth CFBK Listed and Traded on NASDAQ Presence in Two Metro Markets Plus Two More Community Branch Banks • Akron (Fairlawn HQ) Springboard to Cleveland Metro Market • Columbus Existing Presence with Untapped Potential Historical Banking Relationships • Wellsville and
Slide 31: Model Focused on Diversification
31 Model Focused on Diversification • Diversified Balance Sheet, Less Reliance on Real Estate Loans, Greater Focus on Non-Credit Fee Income • Expanding on Community Banking Foundation • Focusing on High Quality Small and Middle Market Businesses, Plus the Private Banking Needs of Executives and Entr
Slide 32: Key Operating Tenets
32 Committed to Building and Developing a Highly Qualified Team Management and the Board Will Have “Skin in the Game” Hands-On Management Style that Stresses Accountability for Results Simple Plan with a Focus on Execution Strong Controls and Risk Management Processes Diversified Business and Asset
Slide 33: CFBK: A Unique Opportunity for Creating Stakeholder Value
33 CFBK: A Unique Opportunity for Creating Stakeholder Value