Stifel Financial Corporation · NYSE:SF

Stifel Financial — Investor Presentation (November 2018)

41 slides from Stifel Financial's investor presentation, November 2018

  1. Slide 1: Investor Presentation November 2018

    Investor Presentation November 2018

  2. Slide 2: Disclaimer

    Disclaimer Forward-Looking Statements This presentation may contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 that involve significant risks, assumptions, and uncertainties, including statements relating to the market opportunity and futu

  3. Slide 3: Our Strategy

    Our Strategy STIFEL

  4. Slide 4: Strategic Vision

    Strategic Vision To build a premier wealth management and investment banking firm Global Wealth Management Institutional Private Asset Bank Equities Fixed Investment Research Client Management Sales + Income Banking Trading Sales + Trading 2,298 financial $31B in total $17B in assets Experienced sal

  5. Slide 5: A History of Growth

    A History of Growth 2018 2017 Ziegler Wealth 2016 City 2015 Eaton Partners Securities Management, Business Barclays Wealth & ISM Capital Bancshares Inc. 2014 Investment Management, De La Rosa, Sterne Agee, Oriel Securities, 2013 1919 Investment Counsel, Acacia Bank & Ziegler Merchant Capital 2013 Lo

  6. Slide 6: 10 Years of Substantial Growth

    10 Years of Substantial Growth Revenue % of % of Ratios & Metrics 2017 Revenue 2007 Revenue Change 2017 2007 Change Income Statement Expense Ratios* Total net revenue $2,928 $763 284% Total comp. ratio 61.2% 64.7% -350 bps Brokerage $1,076 37% $455 60% 137% Total non-comp. ratio 21.7% 20.8% 90 bps G

  7. Slide 7: Driving Shareholder Value Through Deal Integration & Balance Sheet Growth

    Driving Shareholder Value Through Deal Integration & Balance Sheet Growth 7

  8. Slide 8: Balance Sheet Growth

    Balance Sheet Growth $25,000 $23,760 $22,608 $21,715 $21,384 $20,000 $19,129 Infrastructure Total Assets in Millions $15,000 Build $13,326 $9,518 $10,000 $9,009 $6,966 $4,952 $5,000 $4,213 $3,167 $1,558 $- 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 1Q18 2Q18 3Q18 ` 2008 2009 2010 2011 2012 20

  9. Slide 9: Bank Drove Significant Balance Sheet & Revenue Growth

    Bank Drove Significant Balance Sheet & Revenue Growth Impact of Bank Growth LTM on Consolidated Results Bank growth has been balanced between loans and investments: (mil.) 9/30/2017 9/30/2018 Loans: Total consolidated assets $20,484 $23,760 • Comprised of securities based loans, C&I, and Investment

  10. Slide 10: Stifel Overview

    Stifel Overview STIFEL 10

  11. Slide 11: Stifel – Premier Investment Bank and Wealth Management Firm

    Stifel – Premier Investment Bank and Wealth Management Firm Stifel at a Glance 2017 GAAP Net Revenue - $2.9 billion Global Wealth Management (GWM) Institutional Group (IG) 2017 Net Revenue - $1.8 billion 2017 Net Revenue - $1.1billion  Private Client  Equity & Fixed Income Capital Raising  Stifel

  12. Slide 12: Leading broker-dealer providing wealth management and institutional services

    Leading broker-dealer providing wealth management and institutional services to consumers and companies Bulge Bracket Boutique  Size / scale  Firm focus  Large distribution  Good research  Size / scale  Trading  Growth investor access  Firm focus  Retail Issues  Stability (financial & pers

  13. Slide 13: Well-diversified, Low Risk Business Model with Balanced Retail and Institutional Exposure

    Well-diversified, Low Risk Business Model with Balanced Retail and Institutional Exposure  Unburdened by capital constraints  Low leverage business model and conservative risk management  Limited balance sheet risk  Stable wealth management business is augmented by profitable and growing institu

  14. Slide 14: A Stable Track Record Through Multiple Business Cycles

    A Stable Track Record Through Multiple Business Cycles Non-GAAP Net Revenues(1) ($MM) Total Equity ($MM) $3,500 $3,500 $2,928 $3,162 $3,000 $2,580 $3,000 $2,862 $2,738 $2,335 $2,492 $2,500 $2,213 $2,500 $2,320 $1,978 $2,059 $2,000 $2,000 $1,594 $1,384 $1,417 $1,495 $1,500 $1,500 $1,091 $1,254$1,302

  15. Slide 15: Global Wealth Management

    Global Wealth Management STIFEL

  16. Slide 16: Global Wealth Management (GWM)

    Global Wealth Management (GWM) Provides Securities Brokerage Services and Stifel Bank Products Overview National Presence  Grown from 600+ financial advisors in 2005 to 2,298 financial advisors currently  Proven organic growth and acquirer of private client business  Strategy of recruiting experi

  17. Slide 17: Building Scale and Capabilities into a $1.8B Revenue Segment

    Building Scale and Capabilities into a $1.8B Revenue Segment  55 advisors managing ~$5B in AUM  March 2018  ~40 advisors managing ~$4B in AUM  January 2017  ~100 advisors managing over $20B in AUM  December 2015 Private Client  ~130 advisors managing ~ $10B in AUM  June 2015  Customized inv

  18. Slide 18: GWM - Private Client Group

    GWM - Private Client Group Key Operating Metrics Financial Advisors(1) Branches(1) 2,500 2,291 2,282 2,298 400 2,244 361 360 368 355 2,077 2,103 1,987 2,041 350 330 1,885 1,935 317 2,000 307 285 291 300 272 1,500 250 1,315 196 1,163 200 1,000 148 150 100 500 50 0 0 2007 2008 2009 2010 2011 2012 2013

  19. Slide 19: GWM – Stifel Bancorp, Inc.

    GWM – Stifel Bancorp, Inc. Overview Key Statistics (000s) (2)(3)  Acquired FirstService Bank, a St. Louis-based, Missouri- Total assets $16,989 chartered commercial bank, in April 2007 Total deposits 14,503  Stifel Financial became a bank holding company and Total equity 1,186 financial services h

  20. Slide 20: Growing Asset Management Capabilities

    Growing Asset Management Capabilities Asset Management Subsidiaries with Over $31 Billion in Client Assets Assets $12.3 Billion $12.1 Billion $4.3 Billion $2.6 Billion Chicago Baltimore Milwaukee Birmingham, Baltimore Offices New York Cincinnati Florham Park, NJ Boston St. Louis New York San Francis

  21. Slide 21: Institutional Group

    Institutional Group STIFEL

  22. Slide 22: Institutional Group

    Institutional Group Overview Net Revenues ($MM)(2)(3)(4) $1,200 Provides securities brokerage, trading, research, underwriting and $1,111  $1,014 $997 corporate advisory services $976 $900 $861  Largest provider of U.S. Equity Research $668 $626 $587 $605 $600 $559 3rd largest Equity trading platf

  23. Slide 23: Building Scale and Capabilities into a $1.0B Revenue Segment

    Building Scale and Capabilities into a $1.0B Revenue Segment  Growth Focused Investment Banking, Research, Sales and Trading  July 2010  Core of our Institutional sales, trading and research group  December 2005  Enhances European debt capital markets capabilities  February 2016 Equities  Hig

  24. Slide 24: Institutional Group – Advisory

    Institutional Group – Advisory 2010-2018 YTD: Leadership in M&A of Public Companies and deals < $1bn. All Deals < $1 Billion in Value Public Deals < $1 Billion in Value Rank Investment Bank Sell-side Buy-side Total Value Rank Investment Bank Sell-side Buy-side Total Value 1 Goldman Sachs 395 266 661

  25. Slide 25: Institutional Group – Equity Underwriting

    Institutional Group – Equity Underwriting Accomplished U.S. Equity Underwriting Franchise – All Equity Transactions All Managed Equity Deals Since 2010 Bookrun Equity Deals Since 2010 ($ in billions) # of $ Rank Firm Deals Volume 1 JPMorgan 1,734 $221.9 2 Bank of America Merrill Lynch 1,644 $188.7 3

  26. Slide 26: Institutional Group – Research

    Institutional Group – Research Largest U.S. Equity Research Platform U.S. Equity Research Coverage (1)(2) Stifel Research Highlights Companies Under Coverage  Largest provider of U.S. Equity Research Rank Firm Overall Mid Cap Small Cap 1 Stifel / KBW 1,195 448 304  Largest provider of U.S. Small C

  27. Slide 27: Institutional Group – Equity Sales and Trading

    Institutional Group – Equity Sales and Trading Powerful Platform Spanning North America and Europe Institutional Equity Sales Equity Trading  60 person sales force  21 sales traders located in  Experts in small and mid cap growth and value  Baltimore, New York, Boston,, San Francisco, and  Team

  28. Slide 28: Institutional Group – Fixed Income Capital Markets

    Institutional Group – Fixed Income Capital Markets Strong Fixed Income Brokerage Capabilities Overview Client Distribution (1)(2)  Comprehensive platform Other 9% Broker/Dealer  85 traders with annual client trade volume approaching 7% $500 billion Insurance Co.  45-person Fixed Income Research a

  29. Slide 29: Institutional Group – Public Finance

    Institutional Group – Public Finance Overview  Stifel has ranked in the top ten nationally  Specialty sectors: for senior managed negotiated Education underwritings for the past five years, and  Stifel has ranked #1 nationally for senior  Local Government/Municipal managed K-12 negotiated underw

  30. Slide 30: Guidance & Third Quarter Review

    Guidance & Third Quarter Review 30

  31. Slide 31: Fourth Quarter 2018 & Initial 2019 Outlook

    Fourth Quarter 2018 & Initial 2019 Outlook millions 3Q18 Actual 4Q18 Estimate 2018 Estimate 2019 Estimate Operating Net Revenue $617 $637 - $673 $2,519- $2,555 $2,470 - $2,800 Net Interest Income $121 $123 - $127 $473 - $477 $530 - $550 Net Revenue $738 $760 - $800 $2,992 - $3,032 $3,000 - $3,350 Co

  32. Slide 32: Highlights & Third Quarter Results

    Highlights & Third Quarter Results • Non-GAAP Net Revenue of $738 million, up 2% Y/Y. • Non-GAAP ROE of 15.5% & Non-GAAP ROTCE of 25.2% • Record Asset Management & Services Fees of $201 million, up • Added 31 Net New Advisors in Quarter 12% Y/Y. • Record Client AUA of $289 billion • Record Net Inter

  33. Slide 33: Segment Results

    Segment Results STIFEL

  34. Slide 34: Global Wealth Management

    Global Wealth Management GWM Net Revenue Y/Y Sequential YTD $500 millions 3Q18 Change Change 2018 Change $400 Global Wealth Management Revenue Net Revenue (mil) Commissions $118 2% 0% $355 0% $300 Principal Transactions $41 -4% 0% $126 -11% $200 Brokerage $159 0% 0% $481 -3% $100 Asset Management &

  35. Slide 35: Institutional Group

    Institutional Group Y/Y Sequential YTD millions 3Q18 Change Change 2018 Change Institutional Group Net Revenue Ins titutional Revenue $350 Equity GAAP Net Revenue (mil.) $300 Advisory $73 -23% -9% $250 10% $250 Underwriting $65 50% 48% $162 30% $200 Brokerage $44 -3% -3% $137 -8% $150 $100 Equity Ca

  36. Slide 36: Revenue & Expenses

    Revenue & Expenses STIFEL

  37. Slide 37: Brokerage Revenue and Asset Management & Service Fees

    Brokerage Revenue and Asset Management & Service Fees Brokerage Revenue Three Months Ended YTD (000s) 3Q18 3Q17 % Change 2Q18 % Change 2018 2017 % Change Global Wealth Management brokerage revenue $158,818 $158,334 0% $159,290 0% $480,842 $497,913 -3% Institutional brokerage: Equity Capital Markets

  38. Slide 38: Investment Banking Revenue

    Investment Banking Revenue Investment banking: Three Months Ended YTD (000s) 3Q18 3Q17 % Change 2Q18 % Change 2018 2017 % Change Capital raising: Global Wealth Management revenue $7,722 $9,072 -15% $7,968 -3% $23,378 $31,567 -26% Equity Capital Markets 65,000 43,277 50% 44,087 47% 161,793 124,922 30

  39. Slide 39: Net Interest Income

    Net Interest Income Average Yields on Balance Sheet Net Interest Income Growth 3Q18 3Q17 % Change 2Q18 % Change $140 $117 $121 Assets: $120 $107 $111 Bank loans 3.88% 3.10% 78 bps 3.63% 25 bps Net Interest Income (mil.) $100 $100 Commercial 4.62% 3.96% 66 bps 4.36% 26 bps $80 Securities based 3.94%

  40. Slide 40: Stifel Bancorp, Inc.

    Stifel Bancorp, Inc. % % (mil. except for %'s) 3Q18 3Q17 Change 2Q18 Change Assets: Mortgage Loans 2,792 2,518 11% 2,704 3% Commercial Loans 3,127 2,380 31% 2,677 17% Securities Based Loans 1,836 1,840 0% 1,846 -1% Commercial Real Estate 329 79 316% 127 159% Loans Held for Sale 262 166 58% 211 24% T

  41. Slide 41: Expenses

    Expenses Non-GAAP Expenses & Three Months Ended Compensation Ratio 62.0% Pre-tax Income % % 61.1% 61.0% 60.0% 60.5% 3Q18 3Q17 Change 2Q18 Change 60.0% 59.0% (millions) 59.0% 58.0% Compensation $417 $440 -5% $438 -5% #DIV/0! 57.0% 56.5% 56.0% Non-compensation $169 $160 6% $167 1% #DIV/0! 55.0% 54.0%

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