Eagle Financial Services Inc · NASDAQ:EFSI
Eagle Financial Services — Investor Presentation (August 2023)
30 slides from Eagle Financial Services's investor presentation, Aug 8, 2023
Slide 1: Investor Presentation Eagle Financial Services, Inc.
Investor Presentation Eagle Financial August 2023 Services, Inc.
Slide 2: Forward Looking Statements
Forward Looking Statements Forward Looking Statements Certain information contained in this Presentation (together with oral statements made in connection herewith, this “Presentation”) may include “forward-looking statements” within the meaning of the “safe harbor” provisions of the United States P
Slide 3: Table of Contents
Table of Contents Introduction Detailed Financial Review Appendix
Slide 4: 1. Introduction
1. Introduction
Slide 5: Company Overview: The EFSI Story
Company Overview The EFSI Story 2023 Q1 Financial Highlights WASHINGTON DC Arlington Annapolis Baltimore MARYLAND 95 81 EFSI Branches (13) EFSI LPO (2) VIRGINIA Berryville Winchester Eagle Financial Services, Inc., operating as Bank of Clarke, was established over 140 years ago Commercial focused ba
Slide 6: History of Growth
Opened branch in Loudoun County, VA WASHINGTON DC Arlington Annapolis Baltimore MARYLAND 95 81 Bank of Clarke opened for business Eagle Financial Services, Inc. was incorporated First expansion out of Clarke County and into Winchester City, VA and Frederick County, VA markets Expanded footprint in N
Slide 7: Investment Highlights
Experienced Leadership Team Attractive Markets of Operation Deep management team with notable community and regional banking experience in the Mid Atlantic Insider ownership of 13% aligns shareholder interest with day-to-day decision making Operate in 2 of the top 10 highest household income countie
Slide 8: Management Team & Board of Directors
Seasoned Management Team Experienced and Balanced Board Management Team & Board of Directors Brandon Lorey President, Chief Executive Officer & Director Age: 54 Years in Banking: 33 EFSI Experience: 4 Kathleen Chappell Executive VP and Chief Financial Officer Age: 56 Years in Banking: 33 EFSI Experi
Slide 9: Dominant Market Share in Our Core Markets
Dominant Market Share in Our Core Markets Winchester, VA MSA Historical Growth in Winchester Deposits ($B) Loudoun County, VA EFSI 10-Year CAGR: 10% Source: S&P Capital IQ Pro; Deposit data as of 6/30 each respective year Community banks defined as banks under $10B in assets Winchester MSA 10-Year C
Slide 10: Metro vs. Community Markets Loans and Deposits by Market
Metro(1) vs. Community Markets Loans and Deposits by Market Loans Deposits Current Balances by Market Dollars in millions Source: Company documents, US Census; data as of 12/31 each year ended and as of the three months ended 6/30/23 Metro defined as a county with a population of over 250,000 at 202
Slide 11: Strategic Objectives
Strategic Objectives Maintain focus on strong, profitable organic growth without compromising credit quality Identify areas to expand non-interest income Increase utilization of technology to drive revenue and lower expenses Increase operating revenue, maximize operating earnings, grow tangible book
Slide 12: 2. Detailed Financial Review
2. Detailed Financial Review
Slide 13: Balance Sheet Growth
Gross Loans ($M) Balance Sheet Growth Total Assets ($M) Total Deposits ($M) Source: Company documents; annual data as of 12/31 each year ended; quarterly data as of 6/30/23 CAGR: 19% CAGR: 22% CAGR: 18%
Slide 14: Core Deposit Portfolio
Demand Deposit CAGR: 13% Core Deposit Portfolio Cost of Deposits (%) Deposit Composition Over Time($M) Deposit Composition Core deposits continue to fuel our organic loan growth strategy Continued focus on commercial deposits; recently expanded treasury management product suite Bankers are incentivi
Slide 15: Deposit Granularity
Deposit Granularity Monthly Cost of Deposits (%) Deposit Portfolio Summary Deposits: Uninsured Deposits: Average Deposit Size: Total Deposit Accounts: Commercial Accounts: Personal Accounts: Current Rate Cycle IB Deposit Beta(1): Current Rate Cycle Total Deposit Beta(2): Source: Company documents; d
Slide 16: Loan Portfolio
Loan Portfolio Loan Composition 2018 Q2 ‘23 C&D: 57% CRE: 207% C&D: 49% CRE: 262% Continued focus on providing credit to small and medium sized businesses No Shared National Credit Exposure and limited exposure to purchased and participated loans 16 commercial bankers throughout our footprint and 1
Slide 17: Asset Quality
Asset Quality Nonperforming Assets by Type ($M) Reserves / Loans (%) (0.05%) 0.18% (0.09%) (0.02%) (0.05%) Comprehensive and conservative underwriting process Highly experienced bankers incentivized with equity ownership Commitment to a diverse loan portfolio while maintaining strong asset quality m
Slide 18: Securities Portfolio
Securities Portfolio Securities Portfolio Composition Maturity Schedule ($000s) Securities Portfolio Attributes Shifted to a more conservative bond portfolio in recent years Weighted average life of 6.1 years, and effective duration of 4.7 years Weighted average book yield of 1.90% Source: Company d
Slide 19: Yield and Cost Analysis
Yield and Cost Analysis Source: Company documents; annual data for the twelve months ended ended each year; quarterly data for the three months ended each quarter (1) Yield on cash calculated as yield on balances in depository institutions
Slide 20: Noninterest Income Highlights
$13.8 Noninterest Income Highlights Historical Fee Income Sources ($M) Diversified Revenue Sources Recent expansion of Wealth Management division with several new hires in 2021 and 2022 11 professionals dedicated to Wealth Management services Investment Management Personal Managed Portfolios Institu
Slide 21: Consistent Profitability Metrics
Consistent Profitability Metrics Return on Average Assets (ROAA)(%) NII / AA and NIE / AA (%) Return on Average Tangible Common Equity (ROATCE) (%) Efficiency Ratio (%) NII / Revenue 18.9% 19.6% 18.1% 21.6% 22.3% Source: Company documents; annual data as of 12/31 each year ended; quarterly data as o
Slide 22: Operating Leverage
Operating Leverage Assets / Full-Time Employees ($M) Deposits / Branch ($M) Revenue and NIE ($M) Full-Time Employees 175 175 195 221 241 Branches 12 12 12 12 13 Source: Company documents; data as of 12/31 each year ended; quarterly data as of 6/30/23 (1) YTD revenue and noninterest expense data show
Slide 23: Earnings, Book Value and Dividends
Earnings, Book Value and Dividends Earnings per Share ($) Net Income ($M) Dividend per Share ($) Tangible Book Value per Share ($) Source: Company documents; annual data as of or for the twelve months ended each period; quarterly data as of or for the three months ended 6/30/23 Core EPS CAGR shown t
Slide 24: Capital Ratios
Leverage Ratio (%) Tangible Common Equity / Tangible Assets (%) Capital Ratios CET1 Ratio (%) Total Risk-Based Capital Ratio (%) Source: Company documents; data as of 12/31 each year ended; quarterly data as of 6/30/23 See appendix for reconciliation of non-GAAP metrics Q2 ’23 leverage ratio bank le
Slide 25: 3. Appendix
3. Appendix
Slide 26: Funding and Sources of Liquidity
Funding and Sources of Liquidity Source: Company documents; data as of 6/30/23 $2.3M cash at the holding company as of June 30, 2023 Dividend capacity from the bank to the holding company of $29.9M as of June 30, 2023 Unused lines of credit to purchase federal funds from correspondent banks totaling
Slide 27: Interest Rate Sensitivity
Interest Rate Sensitivity Variable vs. Fixed Rate Loans Shock Analysis: Change in Net Interest Income $342M of total variable rate loans $812M of total fixed rate loans $398M of fixed rate loans mature within 5 years Source: Company documents; data as of 3/31/23
Slide 28: Loan Concentration Ratios
Loan Concentration Ratios Bank CRE Ratio Over time (%) Bank C&D Ratio Over time (%) Source: Company documents; annual data as of 12/31 each year ended; quarterly data as of 6/30/23
Slide 29: Historical Financials
Historical Financials Source: Company documents Dollars in millions (1) See appendix for reconciliation of non-GAAP metrics (2) Core Income defined as net income after taxes and before extraordinary items, less net income attributable to noncontrolling interest, gain on the sale of held to maturity
Slide 30: Non-GAAP Reconciliation
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