German American Bancorp, Inc. · NASDAQ:GABC
German American Bancorp — Raymond James U.S. Bank Conference 2020
33 slides from German American Bancorp's conference presentation, Sep 8, 2020
Slide 1: German American Raymond James U.S. Bank Conference
German American Symbol: GABC September 9 – 10, 2020 Raymond James U.S. Bank Conference
Slide 2: Presented By
Presented By Mark A. Schroeder, Chairman and CEO (812) 482-0701 mark.schroeder@germanamerican.com Bradley M. Rust, EVP and CFO (812) 482-0718 brad.rust@germanamerican.com 2
Slide 3: Cautionary Note Regarding Forward-Looking Statements
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS When used in this presentation and our oral statements, the words or phrases “believe,” “will likely result,” “are expected to,” “will continue,” “is anticipated,” “estimate,” “project,” “plans,” or similar expressions are intended to identify “fo
Slide 4: Who We Are
Who We Are Indiana & Kentucky Community-focused Financial Services Organization • Banking, Insurance, Investments & Trust • $4.9 Billion Total Banking Assets • $1.6 Billion Investment and Trust Assets Under Management • $60 Million Annual Insurance Premiums • 825+ FTEs • 73 Banking Offices 4
Slide 5: COVID-19 Credit Risk Management
COVID-19 Credit Risk Management • Industry Segment Risk Profile • COVID-19 Related Loan Deferrals • Paycheck Protection Program • Strong Capital Structure 5
Slide 6: Industry Segment Profiles Affected by COVID-19
Industry Segment Profiles Affected by COVID-19 As of August 31, 2020 (Dollars in Thousands) % Of Total % of Industry Number Outstanding Loans Segment Industry Segment of Loans Balance (excludes PPP Under Loans) Deferral Lodging/Hotels 49 $131,972 4.6% 33.3% Student Housing 107 $94,000 3.3% 0.0% Reta
Slide 7: COVID-19 Related Loan Deferrals
COVID-19 Related Loan Deferrals As of August 31, 2020 (Dollars in Thousands) Number of Outstanding % of Loan Category Types of Loans Loans Balance (Excludes PPP Loans) As of 8.31.20 As of 6.30.20 Commercial & Industrial Loans 23 $2,752 0.1% 10.8% Commercial Real Estate Loans 40 $77,890 2.7% 15.3% Ag
Slide 8: SBA Payroll Protection Plan
SBA Payroll Protection Plan As of August 31, 2020 • 3,070 SBA payroll protection plan loans • $351 million total • $12.7 million potential fees (gross) 8
Slide 9: Strong Capital Structure
Strong Capital Structure Key Ratios as of June 30, 2020 TCE/ Tangible Assets 9.79% Total Risk-based 15.22% Tier 1 Risk-based 13.35% Leverage 9.97% 9
Slide 10: Diversified Economic Base – Indiana
Diversified Economic Base Regional Education, Health Care Manufacturing & Logistics Life Sciences & Technology MAJOR INDIANA EMPLOYERS: Manufacturing & Logistics Energy Education Aisin U.S.A. MFG, Inc. Indiana University ALCOA Warrick Operations Indiana University Southeast Amazon Fulfillment Servic
Slide 11: Diversified Economic Base – Kentucky
Diversified Economic Base Regional Education Health Care & Social Assistance Manufacturing & Logistics MAJOR KENTUCKY EMPLOYERS: Retail & Government Education University of Kentucky Manufacturing & Logistics Retail Western Kentucky University Bowling Green Metal Forming Amazon Daviess County Public
Slide 12: Capitalize upon Market Strength & Growth – Indiana
Capitalize upon Market Strength & Growth Indiana Small MSA Market Expansion Total Market GABC Deposit Market Share # of Market Deposits Market Share*** Position*** Branches Heritage Markets* $ 5,300,573 34% #1 31 Evansville/Newburgh $ 4,830,382 10% #3 8 Bloomington $ 2,474,524 9% #4 3 Columbus $ 1,2
Slide 13: Capitalize upon Market Strength & Growth – Kentucky
Capitalize upon Market Strength & Growth Kentucky Small MSA Market Expansion Total Market GABC Deposit Market Share # of Market Deposits Market Share* Position* Branches* Owensboro $ 2,719,563 5% #6 3 Bowling Green $ 2,679,918 10% #4 6 Lexington $ 7,899,671 .2% #25 2 Total Kentucky $ 13,299,152 Grow
Slide 14: History of Superior Financial Performance
History of Superior Financial Performance Ten Years of Consecutive Record Earnings Performance Double-Digit Return on Equity for Past 15 Consecutive Fiscal Years Raymond James 2012 thru 2017 Community Bankers Cup Recipient Bank Director Magazine - Bank Performance Scorecard Top 15 National Ranking f
Slide 15: Financial Trends
TUT eee Financial Trends
Slide 16: Total Assets and Annualized Return on Assets
Total Assets Annualized Return on Assets $6,000 $5,000 $4,851 $4,398 $3,929 $4,000 $3,144 $2,956 $3,000 $2,374 1.43% $2,000 1.33% 1.35% 1.38% 1.24% 1.18% $1,000 $- 12/31/15 12/31/16 12/31/17 12/31/18 12/31/19 06/30/20 (Dollars in Millions) 16
Slide 17: Total Loans, Net of Unearned Income
Total Loans, Net of Unearned Income Commercial & Agricultural Loans as % of Total Loans $3,500 $3,266 $3,250 $3,077 $3,000 $2,728 $2,750 $2,500 $2,250 $2,142 $1,990 $2,000 $1,750 $1,564 $1,500 $1,250 82% 81% 81% 82% $1,000 78% 80% $750 $500 $250 $- 12/31/15 12/31/16 12/31/17 12/31/18 12/31/19 06/30/
Slide 18: Loan Composition as of June 30, 2020
Loan Composition as of June 30, 2020 Total Loans $3,266.3 million Residential Mortgage Loans, $ 287.9 million, 9% Construction & Development Loans, Home Equity Loans, $ 194.3 million, 6% $ 217.1 million, 6% Agricultural Loans, $ 383.4 million, 12% Consumer Loans, $ 59.3 million, 2% Commercial Real E
Slide 19: Non-Performing Assets to Total Assets
Non-Performing Assets to Total Assets 2.50% 2.00% 1.50% 1.00% 0.84% 0.76% 0.63% 0.59% 0.56% 0.49%* 0.50% 0.15% 0.38% 0.40% 0.14% 0.34% 0.33% 0.00% 12/31/15 12/31/16 12/31/17 12/31/18 12/31/19 06/30/20 GABC Peer Group *Peer Group Information as of 3/31/20 19
Slide 20: Total Deposits
Total Deposits Non-Maturity Deposit Accounts as % of Total Deposits $3,979 $4,000 $3,500 $3,430 $3,073 $3,000 $2,484 $2,500 $2,350 $2,000 $1,826 86% 84% 84% 83% 82% $1,500 81% $1,000 $500 $- 12/31/15 12/31/16 12/31/17 12/31/18 12/31/19 06/30/20 (Dollars in Millions) 20
Slide 21: Deposit Composition as of June 30, 2020
Deposit Composition as of June 30, 2020 Total Deposits $3,979.4 million Non-Interest Bearing Interest Bearing Demand, Demand, $1,139.9 million, Savings & Money Market, 29% $2,267.1 million, 57% Year Cost of Cost of Deposits Funds 2015 0.22% 0.28% 2016 0.23% 0.32% 2017 0.30% 0.40% 2018 0.50% 0.61% 20
Slide 22: Total Shareholders' Equity and Return on Tangible Equity
Total Shareholders’ Equity Annualized Return on Tangible Equity $650 $595 $600 $574 $550 $500 $459 $450 $400 $365 $350 $330 $300 $252 $250 14.98% 13.82% 14.82% 13.74% 13.02% 11.91% $200 $150 $100 $50 $- 12/31/15 12/31/16 12/31/17 12/31/18 12/31/19 06/30/20 (Dollars in Millions) 22
Slide 23: Net Interest Income and Net Interest Margin
Net Interest Income Net Interest Margin (Tax-Equivalent) $160,000 $145,225 $140,000 $120,000 $114,610 $99,909 $100,000 $94,904 3.92% $80,000 $75,552 $74,715 $67,232 3.75% 3.76% 3.75% $60,000 3.70% 3.86% $40,000 3.66% $20,000 $- 12/31/15 12/31/16 12/31/17 12/31/18 12/31/19 6/30/19 6/30/20 YTD YTD (Do
Slide 24: Provision for Credit Losses and Net Charge-offs
Provision for Credit Losses Net Charge-off to Average Loans $12,000 $11,050 $11,000 $10,000 $9,000 $8,000 $7,000 $6,000 $5,325 $5,000 $4,000 $3,000 $2,070 $2,000 $1,750 $- $1,200 0.17% $925 $1,000 0.08% 0.03% 0.04% 0.04% 0.04% 0.03% $- 12/31/15 12/31/16 12/31/17 12/31/18 12/31/19 6/30/19 6/30/20 YTD
Slide 25: Non-Interest Income
Non-Interest Income Non-Interest Income as % of Total Revenue $50,000 $45,501 $45,000 $40,000 $37,070 $35,000 $32,013 $31,854 $30,000 $27,444 $26,504 $25,000 $22,167 26% 26% 24% 24% $20,000 23% 24% 24% $15,000 $10,000 $5,000 $- 12/31/15 12/31/16 12/31/17 12/31/18 12/31/19 6/30/19 6/30/20 YTD YTD (Do
Slide 26: Why Invest in GABC?
Why Invest in GABC? 26
Slide 27: Non-Interest Expense and Efficiency Ratio
Non-Interest Expense Efficiency Ratio $120,000 $114,162 $100,000 $93,553 $80,000 $76,587 $77,803 $61,326 $58,416 $60,000 60.6% $52,377 59.0% 58.3% 57.6% 57.7% $40,000 56.8% 56.9% $20,000 $- 12/31/15 12/31/16 12/31/17 12/31/18 12/31/19 6/30/19 6/30/20 YTD YTD (Dollars in Thousands) 27
Slide 28: Net Income & Earnings Per Share
Net Income & Earnings Per Share Earnings Per Share* $59,222 $60,000 $50,000 $46,529 $40,676 $40,000 $35,184 $30,064 $30,338 $30,000 $2.29 $26,727 $1.99 $1.77 $1.57 $20,000 $1.51 $1.21 $1.01 $10,000 $- 12/31/15 12/31/16 12/31/17 12/31/18 12/31/19 6/30/19 6/30/20 YTD YTD (Dollars in Thousands, Except
Slide 29: Why Invest in GABC? Earnings Per Share Growth
Why Invest in GABC? GABC Earnings Per Share Growth * $2.29 $1.99 $1.77 $1.51 $1.57 $1.43 $1.27 $1.32 $1.07 $0.81 As of 12/31 for years shown *Earnings Per Share adjusted for 3-for-2 stock split completed in 2017 29
Slide 30: Why Invest in GABC? Tangible Book Value Per Share
Why Invest in GABC? GABC Tangible Book Value Per Share * $16.49 $13.81 $13.45 $11.94 $11.57 $10.40 $8.62 $8.92 $7.64 $6.55 As of 12/31 for years shown *Tangible Book Value Per Share adjusted for 3-for-2 stock split completed in 2017 30
Slide 31: Why Invest in GABC? Stock Price Appreciation
Why Invest in GABC? * GABC Stock Price Appreciation $35.07 $35.33 $35.62 $27.77 $22.21 $20.35 $18.95 $14.48 $12.28 $12.13 As of 12/31 for years shown *Stock Price adjusted for 3-for-2 stock split completed in 2017 31
Slide 32: Why Invest in GABC?
Why Invest in GABC? • Proven Executive Management Team • Track Record of Consistent Top Quartile Financial Performance • Experienced in Operating Plan Execution and M & A Transitions • Potential Growth within New Market Areas – Small MSA Focus • Existing Platform for Operating Efficiency • Infrastru
Slide 33: German American Bancorp, Inc.
German American Bancorp, Inc. Mark A. Schroeder, Chairman and CEO (812) 482-0701 mark.schroeder@germanamerican.com Bradley M. Rust, EVP and CFO (812) 482-0718 brad.rust@germanamerican.com 33
German American Bancorp — Raymond James U.S. Bank Conference 2020 on 6ix