Independent Bank Corporation · NASDAQ:IBCP
Independent Bank — Q1 2015 Earnings Presentation
20 slides from Independent Bank's earnings presentation, Apr 20, 2015
Slide 1: Earnings conference call 1st quarter 2015
INDEPENDENT BANK CORPORATIONEarnings conference call1st quarter - 2015 April 20, 2015
Slide 2: Cautionary note regarding forward-looking statements
Cautionary note regarding forward-looking statements This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements of goals, intentions, and expectations as to future trends, plans, events, or results of Indepen
Slide 3: Agenda
Agenda1st Quarter 2015 Earnings Conference Call Formal Remarks.William B. (Brad) Kessel, President and Chief Executive OfficerRobert N. Shuster, Executive Vice President and Chief Financial OfficerQuestion and Answer session.Closing Remarks.Note: This presentation is available at www.IndependentBank
Slide 4: Financial Summary
Financial Summary 1Q’15 4Q’14 3Q’14 2Q’14 1Q’14 Diluted EPS $ 0.16 $ 0.17 $ 0.21 $ 0.26 $ 0.13 Income before taxes 5,561 5,438 7,274 7,899 4,605 Net income 3,781 3,902 4,929 6,052 3,138 Total assets 2,329,296 2,248,730 2,239,857 2,249,864 2,259,639 Total portfolio loans 1,422,959 1,409,962 1,398,784
Slide 5: 2015 1st Quarter Financial Highlights
2015 1st Quarter Financial Highlights Income Statement Net income of $3.8 million, or $0.16 per diluted share, up 20.5% over 2014.Improved asset quality metrics led to $0.7 million credit loan loss provision.Gains on mortgage loans increased $1.0 million, or 87.0%.Impairment charge on MSR’s of $0.7
Slide 6: Core Banking Markets
Core Banking Markets Since 2012, substantial changes have been implemented to streamline and optimize our branch delivery network.Significant market presence and opportunity to gain market share in attractive Michigan markets. Michigan’s unemployment rate was 5.9% in February 2015 (1.9% lower than F
Slide 7: Statewide Low Cost Deposit Franchise
Statewide Low Cost Deposit FranchiseFocused on Core Deposit Growth $2.00 billion in total deposits at 3/31/15.Substantially all core funding.$1.63 billion of transaction accounts (81.3% of total deposits).Cost of deposits of 0.21% (1Q ’15 annualized).Total deposits increased $76.2 million, or 4.0% s
Slide 8: Diversified Loan Portfolio
Diversified Loan PortfolioFocused on High Quality Growth Four consecutive quarters of net loan growth.$1.45 billion in total loans at 3/31/15 (including $30.9 million of loans held for sale).1Q 2015 lending results include:Commercial loan growth of $19.4 million, or 11.4% annualized. Line usage at 4
Slide 9: Net Interest Margin/Income
Net Interest Margin/Income Interest rate sensitivity profile of the loan and securities portfolios, in combination with a low cost core deposit base, positions us to benefit from a rising interest rate environment.Net interest income increased slightly in 1Q’15 vs. 4Q’14 due to a 1 BP increase in th
Slide 10: Net Interest Income and Net Interest Margin
Net Interest Income and Net Interest MarginAnalysis of Linked Quarter Increase Summary1Q’15 net interest income of $18.091 million, up $34K from 4Q’14. The linked quarter increase was due to a $110K increase in interest income on securities and investments and a $329K decrease in interest expense on
Slide 11: Non-interest Income
Non-interest Income 2015 Non-interest Income Breakout Highlights Diverse sources of non-interest income which totaled $9.0 million in 1Q’15.1Q’15 total non-interest income represents approximately 33.1% of total revenue (net interest income and non-interest income).New debit card brand agreement exe
Slide 12: Non-interest Expense
Non-interest Expense Non-interest Expense ($ in Millions) Highlights Q1’15 non-interest expenses totaled $22.2 million (a decrease from both Q1’14 and Q4’14).Target for 2015 is total non-interest expenses at $21 million to $22 million per quarter (with an average at $21.3 million) – representing a 5
Slide 13: Investment Securities Portfolio
Investment Securities Portfolio High quality, liquid, diverse portfolio with short duration.77% of the portfolio is AAA rated (or backed by the U.S. Government).1.9 year estimated average duration with a weighted average yield of 1.53%.Approximately 40% of the portfolio is variable rate. Total Inves
Slide 14: Credit Quality Summary
Credit Quality Summary Non-performing Loans ($ in Millions) 30-89 Days Delinquent ($ in Millions) ORE / ORA ($ in Millions) Non-performing Assets ($ in Millions) Note: Non-performing loans and non-performing assets exclude troubled debt restructurings that are performing. 14
Slide 15: Credit Cost Summary
Credit Cost SummaryProvision for Loan LossesLoan Net Charge-OffsAllowance for Loan LossesNote: Dollars all in millions
Slide 16: Classified Assets and New Default Trends
Classified Assets and New Default Trends Total Classified Assets ($ in Millions) Commercial Loan New Defaults ($ in Millions) Total Loan New Defaults ($ in Millions) Retail Loan New Defaults ($ in Millions) 16
Slide 17: Troubled Debt Restructurings (TDRs)
Troubled Debt Restructurings (TDRs)90% of TDRs are Current Working with client base to maximize sustainable performance.The specific reserves allocated to TDRs totaled $11.4 million at 3/31/15.A majority of our TDRs are performing under their modified terms but remain in TDR status for the life of t
Slide 18: 2015 Actual vs. Management Original Outlook
2015 Actual vs. Management Original Outlook Category Outlook Lending Modest growthGoal of mid single digit % overall loan growth, primarily supported by mid single digit % growth in commercial loans and consumer loans with modest increases in mortgage loans and payment plan receivables. Expect much
Slide 19: Strategic Initiatives
Strategic Initiatives Balance SheetGenerate quality loan growth with continued focus on commercial and consumer installment lending as well as salable mortgage loans.Remain asset sensitive and positioned to benefit from higher interest rates (short duration investment portfolio, large variable rate
Slide 20: Question and Answer Session, Closing Remarks
Independent Bank Corporation1st Quarter 2015 Earnings Conference Call Question and Answer SessionClosing RemarksThank you for attending !NASDAQ: IBCP 20