First Internet Bancorp · NASDAQ:INBK
First Internet Bancorp — Q1 2021 Earnings Presentation
24 slides from First Internet Bancorp's earnings presentation, May 28, 2021
Slide 1: Investor Presentation First Quarter 2021
Investor Presentation First Quarter 2021 Exhibit 99.1
Slide 2: Forward-Looking Statements & Non-GAAP Financial Measures
Forward-Looking Statements & Non-GAAP Financial Measures This presentation may contain forward-looking statements with respect to the financial condition, results of operations, trends in lending policies, plans, objectives, future performance or business of the Company. Forward-looking statements a
Slide 3: A Pioneer in Branchless Banking
A Pioneer in Branchless Banking Digital bank with unique business model and over 20 years of operations Highly scalable technology driven business Nationwide deposit gathering and asset generation platforms Attractive lending niches with growth opportunities History of strong growth and a
Slide 4: Nationwide Branchless Deposit Franchise
Nationwide Branchless Deposit Franchise 4 $672.5 million 20.9% $280.5 million 8.7% $1,218.4 million 37.9% $545.2 million 16.9% $501.0 million 15.6% * As of March 31, 2021; $118 million of brokered deposits and $1.5 million of balances in US territories/Armed Forces included in headquarters/Midwest b
Slide 5: Multiple Opportunities to Grow Deposits
Multiple Opportunities to Grow Deposits 5 Capitalize on the enduring trend toward branchless banking – consumers and small business are increasingly moving their banking business online, especially following the experience of COVID-19 Generate an increased level of lower-cost deposits as expansion o
Slide 6: National and Regional Asset Generation Platform
National and Regional Asset Generation Platform 6 DIVERSIFIED ASSET GENERATION PLATFORM Commercial - National Commercial - Regional Single tenant lease financing Small business lending Public finance Healthcare finance (via relationship with Provide, f.k.a. Lendeavor) C&I – Central Indiana C&I – Ari
Slide 7: Entrepreneurial Culture Key to Success
Entrepreneurial Culture Key to Success 7 First Internet Bank has been recognized for its innovation and is consistently ranked among the best banks to work for, enhancing its ability to attract and retain top talent American Banker’s “Best Banks to Work For” Eight years in a row “Top Workplaces
Slide 8: Near-term Profitability Drivers
Near-term Profitability Drivers Continued deposit repricing opportunity combined with stabilized asset yields provides significant opportunity to increase net interest income and net interest margin Annual interest expense savings of approximately $25 million expected for 2021 SBA platform is hittin
Slide 9: First Quarter 2021 Highlights
First Quarter 2021 Highlights 9 1 See Reconciliation of Non-GAAP Financial Measures Loans and Deposits Total portfolio loan balance comparable to 4Q20 Public finance, construction and SBA (PPP) experienced growth from 4Q20 Non-time deposit balances increased 3.4% from 4Q20 while CDs were down
Slide 10: Meaningful Outperformance vs. Peers
Meaningful Outperformance vs. Peers 10 1 Change from 1Q20 – 1Q21; Orange indicates median of publicly traded $3-$7bn asset U.S. banks, green represents top quartile; peer data includes FTE net interest margin data if available 2 Change from 3/31/2020 – 3/31/2021; Orange indicates median of publicly
Slide 11: History of Strong Organic Growth
History of Strong Organic Growth 11 Dollars in millions Total Loans Dollars in millions Total Assets CAGR: 21.1% vs. Peers1 at 14.5% $1,854 $2,768 $3,542 $4,100 $4,246 $4,189 2016 2017 2018 2019 2020 1Q21 Dollars in millions Shareholders’ Equity Dollars in millions Total Deposits CAGR: 23.4% vs. Pee
Slide 12: Consistent Earnings Growth and Increasing Profitability
Consistent Earnings Growth and Increasing Profitability 12 1 See Reconciliation of Non-GAAP Financial Measures. 2 2017 reported net income of $15.2 million included the revaluation of the Company’s net deferred tax asset which reduced net income by $1.8 million and negatively impacted Net Income, EP
Slide 13: Net Interest Income and Net Interest Margin
Net Interest Income and Net Interest Margin FTE net interest margin improved by 27 bps from 4Q20 Interest expense on deposits declined as: 1) higher cost CDs matured and were either replaced at lower rates or not renewed; and 2) full quarter impact of 4Q20 reduction in money market rates Inter
Slide 14: Net Interest Margin Drivers
Net Interest Margin Drivers Linked quarter NIM improvement was primarily attributable to the continued impact of lower deposit costs, and higher loan yields, supplemented by increased prepayment fees – Interest-earning asset yields increased 14 bps from 4Q20 and are expected to remain relatively s
Slide 15: Noninterest Income
Noninterest Income Noninterest income of $8.4 million, compared to $12.7 million in 4Q20 and $6.2 million in 1Q20 Mortgage banking revenue of $5.8 million, compared to $8.0 million in 4Q20 and $3.7 million in 1Q20 Gain on sale of loans of $1.7 million, compared to $3.7 million in 4Q20 and $1.8
Slide 16: Noninterest Expense
Noninterest Expense Noninterest expense of $15.3 million, compared to $14.5 million in 4Q20 and $13.5 million in 1Q20 – Increase in salaries and employee benefits from 4Q20 due mainly to higher medical claims experience and seasonal resets of employee benefits and payroll taxes – Higher marketing
Slide 17: Deposit Composition
Deposit Composition Total deposits declined $53 million, or 1.6%, compared to 4Q20, and increased $39 million, or 1.2%, year-over-year Money market and savings accounts increased by $54.9 million compared to 4Q20 CD and brokered deposit balances decreased $109.5 million compared to 4Q20 Cost
Slide 18: Loan Portfolio Overview
Loan Portfolio Overview Total loan portfolio balance was comparable to 4Q20, and up $166.6 million, or 5.8%, year-over-year Commercial loan balances increased $4.1 million, or 0.2%, compared to 4Q20 driven primarily by growth in public finance, construction and small business/PPP, partially offs
Slide 19: Asset Quality
Asset Quality Asset quality metrics remain among the industry’s best, driven by a strong credit culture and lower-risk asset classes Allowance for loan losses to total loans increased to 1.00% in 1Q21, or 1.02%, excluding PPP loans1 Quarterly provision for loan losses of $1.3 million, compared
Slide 20: Capital
Capital Strong capital generation during the quarter resulted in the tangible common equity to tangible assets ratio increasing 43 bps to 8.12% Tangible book value per share of $34.60, increasing 12.9% since 1Q20 Regulatory capital ratios remained strong at the Company and Bank levels 20 1 See
Slide 21: Reconciliation Measures
Reconciliation of Non-GAAP Financial Measures 21 2016 2017 2018 2019 2020 TTM 1Q21 Net income - GAAP $12,074 $15,226 $21,900 $25,239 $29,453 $33,883 Adjustments: Write-down of other real estate owned - - 1,914 - 1,631 1,631 Net deferred tax asset revaluation - 1,846 - - - - Adjusted net income $12,0
Slide 22: Reconciliation Measures
Reconciliation of Non-GAAP Financial Measures 22 Dollars in thousands 2016 2017 2018 2019 2020 1Q21 Total equity - GAAP $153,942 $224,127 $288,735 $304,913 $330,944 $344,566 Adjustments: Goodwill (4,687) (4,687) (4,687) (4,687) (4,687) (4,687) Tangible common equity $149,255 $219,440 $284,048 $300,2
Slide 23: Reconciliation Measures
Reconciliation of Non-GAAP Financial Measures 23 1 Assuming a 21% tax rate Dollars in thousands 1Q20 2Q20 3Q20 4Q20 1Q21 Total equity - GAAP $305,127 $307,711 $318,102 $330,944 $344,566 Adjustments: Goodwill (4,687) (4,687) (4,687) (4,687) (4,687) Tangible common equity $300,440 $303,024 $313,415 $3
Slide 24: Reconciliation Measures
Reconciliation of Non-GAAP Financial Measures 24 Dollars in thousands 1Q20 2Q20 3Q20 4Q20 1Q21 Allowance for loan losses $22,857 $24,465 $26,917 $29,484 $30,642 Loans $2,892,093 $2,973,674 $3,012,914 $3,059,231 $3,058,694 Adjustments: PPP loans - (58,948) (58,337) (50,554) (53,365) Loans, excluding
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