Mvb Financial Corp. · NASDAQ:MVBF
Mvb Financial — Investor Presentation (October 2019)
29 slides from Mvb Financial's investor presentation, Oct 30, 2019
Slide 1: Investor Presentation November 2019
YOY 83 FINANCIAL Investor Presentation November 2019
Slide 2: Forward Looking Statements & Non-GAAP Financial Measures
Forward Looking Statements & Non-GAAP Financial Measures This Presentation contains forward-looking statements, within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21£ of the Securities Exchange Act of 1934, as amended. These forward-looking statements are based
Slide 3: Our Why Statement
Our Why Statement e /'pur-pose/ noun — the reason for which | | l O S — something is done or created or for ® which something exists "Trusted Partners on the Financial 7 Frontier - Committed to Your Success!
Slide 4: MVB Values
MVB Values Trust Commitment Teamwork
Slide 5: Disruption Creates Opportunities
are} Disruption Creates Opportunities o Uber vs. Yellow Top Cabs o Netflix vs. Movie Theaters o Fintech vs. Banking MVB's “Blue Ocean” Strategy Embraces Disruption “The Fintech tsunami is brewing and banks are becoming yellow top taxis in an Uber world - we must modernize or become irrelevant!” -Lar
Slide 6: MVB Today
MVB Today The Financial Frontier MVB is an innovative financial holding company that provides banking services to individuals and corporate clients in the Mid- Atlantic region, as well as Payment and Fintech Deposit clients throughout the United States. Company Statistics Why MVB? o NASDAQ: MVBF o C
Slide 7: MVB Portfolio
MVB Portfolio Complementary Business Lines — Regional Lending with National Deposits & wy = Client presence Commercial & Mortgage Fintech Payment & Retail Deposit Services @ 12 banking centers in WV and 3 in NoVa © Commercial: Loans, Deposits and Non-interest Income; 74% of loan portfolio Non-intere
Slide 8: Fintech Strategy Execution
Fintech Strategy Execution eep Up Get Ahead < Increase Lower Risk, Positive Higher Risk, Common in Most Banks Exposure to Less Commonin Banks Fintech trend drivers ant.
Slide 9: MVB Fintech Thesis
MVB Fintech Thesis 1. Identify a niche 1. Access to payment rails 2. Build a solution to meet the needs 2. FDIC insured deposits of users in niche 3. All Fintech companies need a 3. Generate revenue with a highly banking relationship profitable business model 4. Scale quickly Technology company buil
Slide 10: Fintech Investment Portfolio Performance
Fintech Investment Portfolio Performance $20,000 18,000 rg GO° ne SI SIEE <ALLIED PAYMENT NETWORK 204% IRR $14,000 $ s12000 PaFinClusive 2 £ $10,000 = Sine | Ml Commerce 6,000 ® se ~~ GRAND AIR Ventures = = $- 2016 2017 2018 Q3 2019 MM Cash Investment —=Fair Value Investments Focused on Strategic Pa
Slide 11: Fintech Differentiators "Distinct, Not Extinct"
Fintech Differentiators “Distinct, Not Extinct” 2019 Growth Coming from Mix of NIB & Reasonably Priced IB Deposits Current Portfolio Mix Pipeline Mix Future Portfolio Mix Specialty Payment: Payments Processing Processing 85% 62% payne x Cryptocurrency Processing Cryptocurrency LW aa 14% 7% Hospitali
Slide 12: Chartwell Compliance Acquisition
Chartwell Compliance Acquisition CHARTWELLA= WY A893 FINANCIAL. REGULATORY COMPLIANCE & RISK MANAGEMENT * Over 150 fintech companies served, ranging from the unicorns to the Fortune 50 "The deal makes sense to us for a number of reasons. First, and most simply, with ply. + Industry-leading hyperspec
Slide 13: NIM Expansion — Outpacing Peers
NIM Expansion — Outpacing Peers Active Focus on NIM & Upward Trend 4.20% 4.09% ~ ~ 400% ~~ _ 3.00% ~ -- 3.82% ~~ 379% eee 3.80% —--- ~SL ~ 364% 3.65% = - 3.60% 108 bps an 3.40% 3.20% 3.00% 2014 2015 2016 2017 2018 YTD 2019 —MVvBF = =Regional Peers Source: SEC flings and SNL Financial Regional peers
Slide 14: Deposit Growth with NIB Focus
Deposit Growth with NIB Focus NIB CAGR of 35% in under Five Years $1,600,000 $1,400,000 2 3 £ % $1,200,000 $1,092,507 $1,121,580 5 3 2 $1,000,000 $921,924 |_| |__| 8 4 3 2 = 3 % 800,000 $771,004 Re) g = 3 x © $600,000 nrg7rotal Deposits ro 2 s & $400,000 g <x $200,000 $- 2014 2015 2016 2017 2018 YTD
Slide 15: Organic Growth
Organic Growth Growth with Profitability Emphasis $ in Millions am $1,962 $2,000 sivas igs $1,751 ea sees ae Core Earnings 37.9% $1,000 $500 0 L Service Fees 32.9% - 2015 2016 2017 2018 YTD 2019 eels) ee Net Interest Income 15.6% e Noninterest-bearing Deposits 14.2% $25 $229") Loans 6.6% $20 1 $15 s
Slide 16: Noninterest-bearing deposits increased
Noninterest-bearing deposits increased 14.2% year-over-year Salt Lake City office Nonperforming loans to total loans ratio of 0.41% Credit Karma relationship
Slide 17: Capital composition
Retained earnings, AOCL & Treasury stock 15% ‘Common stock 58% Convertible Subordinated debt 16% Trust preferred stock 2% SBLF capital 5% Convertible Preferred stock a% Common stock 60% Retained earnings Preferred stock 4% AOC, & Treasury stock 28% Subordinated debt 6% ‘Trust preferred stock 2% ‘Com
Slide 18: Diversified Loan Portfolio
Diversified Loa Growth & Active Management of Concentration Limits s1em 450% Acquisition & Development - Residential HVCRE 21% Acquisition & 1% Development 5% $1200 400% Home Equity $1,200 v = | % $1,000 2 250% 2 $800 = 200% & $600 150% sa 100% $200 1 | 50% $- 0% 2010 2011 2012 2013 2014 2015 2016 2
Slide 19: Commercial Real Estate Portfolio
Commercial Real Estate Portfolio Apartments - Market Apartments - 16% Storage Units Low Income 1% 5% Retail 14% Nursing Homes 29% 23% Source: Compary documents 1-4 Family Residential Owner Occupied 57% Apartments & Multifamily Commercial Development 11% Office Other 7 % Personal Lot Retail isle 2% R
Slide 20: Consistent, Top Tier Asset Quality
Consistent, Top Tier Asset Quality Non-Performing Loans / Total Loans NCOs / Average Loans 3.40% 9 26% 2.92% 0.65% 0.60% ane 0.525% 2.33% 2.243 2.35% 0.559% 2.40% 0.459% 1.90% 0.35% ; 0.259% 0.3596 1.40% oes eae . 0.11% — 4.9556 0.90% . 0.05% 0.17% 017% a7 OEE 0.405% 0.88% 9. 773p 0.14 0.059% 0.07%
Slide 21: High Quality & Consistently Profitable
High Quality & Consistently Profitable $5,000 $2,000 $3,829 $1643 $1541 g1.4a7 sane $4,000 Ce ssi $1,107 = $3,000 $1,000 $2,000 $500 $1,000 s- . 2015 2016 2017 2018 YTD 2018 YTD 2019 2015 2016 $300 : $237 s2aq $247 NCISC $250 29% $200 s100 LE Aegaeaweaage eae esaa eae e NY ©: Othe 2016 2016 2016 201
Slide 22: Strategic & Opportunistic Talent Acquisition
Strategic & Opportunistic Talent Acquisition An Independent Bank Mindset that Embraces a, “Yes, if” Culture Acquisitions Recent NoVa M&A Disruption 2017/2018 12 Team Members Wells Fargo Insurance 2013 23 Team Members Sold in 2016 Lift Outs BB&T 2005 12 Team Members HNB | Salt Lake City 2009-2011 VA.
Slide 23: Full Coverage Risk Management
Full Coverage Risk Management Investment in & Strong Attention to ERM MVB’'s Enterprise-wide Risk Management process is de- centralized, integrated and supported by a leadership driven risk culture. MVB partnered with PRMIA*, a “world wide" industry risk leader to develop a proprietary statistical a
Slide 24: Addressing Risk Management
Addressing Risk Management Cost of Investing in the Future & Scalability Risk Mitigation Mortgage Volatility CRE Concentration ‘Compliance/Regulatory Risk Payment & Fintech Deposit Client Retention Deposit Concentration & Seasonality Operating Efficiency Diversified geographic portfolio Overhead man
Slide 25: Analysts Positive on MVB Story
Analysts Positive on MVB Story April 8, 2019 - The specialty deposit play is the unique aspect of the story. The entrepreneurial bent of the management team — particularly the CEO — is among the more intriguing aspects of the MVBF story... The company has pursued a progressive approach to Fintech, g
Slide 26: Q&A Session
Slide 27: Appendix: Non-GAAP Reconciliation
Appendix: Non-GAAP Reconciliation NONINTEREST INCOME / OPERATING REVENUE TANGIBLE BOOK VALUE PER SHARE Fortheyearended, _ For the year-to-date period ended, For the quarter ende (Dollars in Thousands) 12/31/2017 12/31/2018 _ 09/30/2018 _ 09/30/2019 (Dollars in Thousands) 09/30/2019 Total Noninterest
Slide 28: Appendix: Financial Comparisons
Appendix: Financial Comparisons Source: SEC flingsandCompany documents YTD is through 03/30. Note: Reserves/ Loans exclidesloansheldfor sale (a) NPAs include non-acerung loans, 90+ daysstil accruing, and OREO. thousands, except per share Balance Sheet YTD 2019 YTD2018 FY 2018 017 Total Assets Gross
Slide 29: MVB Financial Corp. contact details
Fairmont, WV 26554 (304) 363-4800 MVB Financial Corp. (304) 367-8697 29