Qcr Holdings, Inc. · NASDAQ:QCRH
Qcr — Investor Presentation (December 2019)
40 slides from Qcr's investor presentation, Dec 12, 2019
Slide 1: December 2019 Investor Presentation
December 2019 Investor Presentation
Slide 2: Forward-looking statements
2 This document contains, and future oral and written statements of QCR Holdings (the “Company”) and its management may contain , f orward - looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 with respect to the financial condition, results of opera tio ns,
Slide 3: Corporate Overview
QCR HOLDINGS, INC. Corporate Overvie
Slide 4: Our Values – Lived and Expected of All at QCRH
4 a relationship driven organization. ® Collaboration Achievement Personal Responsibility Innovation Fulfillment OUR VALUES – LIVED AND EXPECTED OF ALL AT QCRH We work to win. In order to win over our clients with outstanding service, we strive to achieve more than we have done in the past and to ac
Slide 5: • Local charters provide a competitive advantage • Strong, centralized risk management function •
5 a relationship driven organization. ® • Local charters provide a competitive advantage • Strong, centralized risk management function • Efficient centralized group operations • Strong credit and asset quality • Consistent adjusted net income growth • High touch service approach • Serving attractiv
Slide 6: Executive Leadership
6 a relationship driven organization. ® EXECUTIVE LEADERSHIP Larry J. Helling , Chief Executive Officer ▪ Over 30 years of commercial banking experience ▪ Founding member and CEO of Cedar Rapids Bank & Trust ▪ QCR Holdings Board Director since 2001 ▪ Oversight responsibility for specific product lin
Slide 7: Corporate Overview
7 a relationship driven organization. ® CORPORATE OVERVIEW Assets: $5.3 Billion Loans: $3.6 Billion Deposits: $3.8 Billion Wealth Management: $4.5 Billion ▪ $1.15 Billion in Trust Accounts ▪ $3.35 Billion in Brokerage Accounts / RIA Shares Outstanding: 15.8 Million Ownership (as of 9/30/19): ▪ Insti
Slide 8: The Company Completed the Sale of Rockford Bank & Trust to Heartland Financial USA
8 a relationship driven organization. ® 34.5% of adjusted tangible pro - forma equity, or approximately $12.5 million THE COMPANY COMPLETED THE SALE OF ROCKFORD BANK & TRUST TO HEARTLAND FINANCIAL USA Transaction Consideration Purchase Price Premium Closing Date Rationale The sale was completed on N
Slide 9: Improved Profitability Metrics Expected with RB&T Sale
9 a relationship driven organization. ® IMPROVED PROFITABILITY METRICS EXPECTED WITH RB&T SALE Approximately 150 basis point improvement in the Efficiency Ratio ROAA Efficiency Ratio Tangible Book Value Capital Ratios Tangible Book Value per share increase by approximately $0.60 Approximately 8 basi
Slide 10: The Value of Separate Charters
10 a relationship driven organization. ® THE VALUE OF SEPARATE CHARTERS Source: FDIC deposit market share data as provided by S&P Global (as of 6/30/19). Our four distinct, yet similar, operating charters enable us to customize client solutions by market Managed and governed by local veteran bankers
Slide 11: History of Expanding into Attractive Markets
11 a relationship driven organization. ® MISSOURI ILLINOIS IOWA WISCONSIN HISTORY OF EXPANDING INTO ATTRACTIVE MARKETS 1993 QCR Holdings founded by Michael A. Bauer and Douglas M. Hultquist - $14 million IPO 1994 Quad City Bank & Trust (De Novo) 2005 Rockford Bank & Trust (De Novo) Quad City Bank &
Slide 12: Strong Market Share in Attractive MSAs
12 a relationship driven organization. ® STRONG MARKET SHARE IN ATTRACTIVE MSA’S * MSAs include Davenport - Moline - Rock Island, IA - IL, Cedar Rapids, IA, Rockford - IL, Waterloo - Cedar Falls - IA, Des Moines/West Des Moines - IA, and Springfield, MO. All banks reflect Pro Forma Data from acquisi
Slide 13: Unique and Diversified Products and Services
13 a relationship driven organization. ® UNIQUE AND DIVERSIFIED PRODUCTS AND SERVICES QCR Holdings Business Lines • Trust administration • Brokerage accounts and asset management • Financial planning • 9/30/19 AUM: $4.5B • Competitive deposit products • Bank stock loans • Safekeeping and cash manage
Slide 14: Strategies to Continue to Drive Shareholder Value
14 a relationship driven organization. ® Ongoing emphasis on fee income on swaps and gains on sale of USDA and SBA loans as a more significant and consistent component of core revenue STRATEGIES TO CONTINUE TO DRIVE SHAREHOLDER VALUE Loan & Lease Growth Grow Core Deposits Fee Income Grow Wealth Mana
Slide 15: Financial Highlights
QCR HOLDINGS, INC. Financial Highlight
Slide 16: A Consistent Track Record of Asset Growth
16 a relationship driven organization. ® $2.4 $2.5 $2.6 $3.3 $4.0 $4.9 $5.3 61.0% 64.6% 69.3% 72.9% 74.4% 75.4% 75.1% 2013 2014 2015 2016 2017 2018 9/30/19 Total Assets Total Loans & Leases/Total Assets A CONSISTENT TRACK RECORD OF ASSET GROWTH Asset growth has been driven by a combination of organi
Slide 17: Deposit Growth Driven by Core Deposits
17 a relationship driven organization. ® DEPOSIT GROWTH DRIVEN BY CORE DEPOSITS $ in billions Core Deposits (1) Represent Approximately 94% of Total Deposits as of 9/30/19 Organic deposit growth CAGR was 11.5 % from 2013 - 2018 Source: S&P Global Market Intelligence and Company documents. (1) Core d
Slide 18: Cost of Deposits Over Time
18 a relationship driven organization. ® COST OF DEPOSITS OVER TIME Historical Cost of Deposits Source: S&P Global Market Intelligence and Company documents. Note: Deposit betas are defined as the change in the cost of interest bearing deposits over the change in the Fed Funds rate. 12.0% Quarterly
Slide 19: Loan Growth Driven by Commercial Lending
19 a relationship driven organization. ® LOAN GROWTH DRIVEN BY COMMERCIAL LENDING $ in billions (2) Organic loan growth CAGR was 12.6 % from 2013 - 2018 Commercial Loans (1) Represent Approximately 91% of the Loan Portfolio as of 9/30/19 Source: S&P Global Market Intelligence and Company documents.
Slide 20: Asset Quality
20 a relationship driven organization. ® 56.9% 37.4% 5.7% Nonaccrual Loans/Leases Other Real Estate Owned & Repossessed Assets Troubled Debt Restructures ASSET QUALITY $13.2 million Classified Loans & NPAs / Assets Nonperforming Assets Composition as of 9/30/2019 $43.5 $35.7 $28.0 $49.0 $43.7 $28.6
Slide 21: Strong Credit Culture Supported by High Levels of Reserves
21 a relationship driven organization. ® 223% 145% 184% 215% 402% 169% 139% 143% 137% 147% 0% 50% 100% 150% 200% 250% 300% 350% 400% 2015 2016 2017 2018 9/30/19 QCRH Proxy Peers 1.45% 1.28% 1.16% 1.07% 1.00% 1.14% 1.04% 1.04% 0.99% 0.94% 2015 2016 2017 2018 9/30/19 QCRH Proxy Peers Source: S&P Globa
Slide 22: Strong Revenue Growth and Attractive Mix
22 a relationship driven organization. ® Predictable and diversified fee income streams complement net interest income STRONG REVENUE GROWTH AND ATTRACTIVE MIX $ in millions Key Components of Fee Income: • Wealth Management ( $4.5 billion in assets under administration as of 9/30/19) • Correspondent
Slide 23: Consistent Improvement in Shareholder Returns
23 $9.9 $13.8 $20.9 $29.4 $36.3 $46.4 $31.9 $43.0 $1.75 $1.72 $1.99 $2.31 $2.66 $3.08 $2.16 $2.70 2013 2014 2015 2016 2017 2018 YTD 9/30/18 YTD 9/30/19 CONSISTENT IMPROVEMENT IN SHAREHOLDER RETURNS Adj. Net Income (1) $ in millions Adj. EPS (2) 34.8% Source: Company documents. (1) Adjusted net incom
Slide 24: Historical Profitability Metrics
24 a relationship driven organization. ® HISTORICAL PROFITABILITY METRICS Source: S&P Global Market Intelligence and Company documents. (1) Non - GAAP – see appendix slide 37 for reconciliation of GAAP ROAA to adjusted ROAA. (2) Adjusted NIM excludes accretable yield (non - GAAP) – see appendix slid
Slide 25: Execution on Strategic Initiatives
25 a relationship driven organization. ® ▪ Carefully manage noninterest expense growth (year - over - year) ▪ Strong organic loan and lease growth to maintain loans and leases to total assets ratio in the range of 73% - 78% ▪ Focus on growing core deposits to maintain reliance on wholesale funding t
Slide 26: Appendix
QCR HOLDINGS, INC.
Slide 27: Historical Financials
27 a relationship driven organization. ® Source: S&P Global Market Intelligence and Company documents. (1) Non - GAAP – see appendix slide 38 for reconciliation of tangible common equity to GAAP stockholders’ equity (2) Non - GAAP – see appendix slide 37 for reconciliation of GAAP ROAA to adjusted R
Slide 28: Quad City Bank & Trust
28 QUAD CITY BANK & TRUST John H. Anderson, President & CEO Assets: $1.66 Billion 1 (as of 6/30 /19 ) Population: 382,013 Market Deposits: $8.2 Billion Ranked 1 st with 17.6% market share and over $1.43 billion in deposits in Davenport - Moline - Rock Island MSA Finalist 2013 and 2014 – Quad Cities
Slide 29: Cedar Rapids Bank & Trust
29 CEDAR RAPIDS BANK & TRUST Larry J. Helling, CEO James Klein, President Assets: $1.53 Billion 1 (as of 6 /30/19 ) Population: 273,208 Market Deposits: $5.9 Billion Ranked 1 st with 18.1% market share and over $1.15 billion in deposits in Cedar Rapids MSA 2018 Top Workplace in Iowa by the Des Moine
Slide 30: Community Bank & Trust
30 COMMUNITY BANK & TRUST Stacey J. Bentley, President & CEO Deposits: $132 Million (as of 6/30/19 ) Population: 174,244 Market Deposits: $1.7 Billion Ranked 6 th with 6.05% market share and $132 million in deposits in Black Hawk County 2016 and 2017 Employer of Choice – Courier Communications Major
Slide 31: Community State Bank
31 COMMUNITY STATE BANK Kurt A. Gibson, President & CEO Assets: $808 Million (as of 6/30 /19 ) Population: 682,877 Des Moines/West Des Moines MSA Market Deposits: $18.7 Billion Ranked 7th with 4.02% market share and $706 Million in deposits in Des Moines – West Des Moines MSA 2018 Voted Best Bank in
Slide 32: SFC Bank
32 SFC BANK Robert C. Fulp, CEO Monte C. McNew , President Assets: $672 Million (as of 6/30 /19 ) Population: 467,912 Springfield, MO - MSA Market Deposits: $9.9 Billion Ranked 7 th with 4.3% market share and over $471 million in deposits in Springfield MSA Major Employers ( Springfield) CoxHealth S
Slide 33: Rockford Bank & Trust – Sale Complete
33 ROCKFORD BANK & TRUST – SALE COMPLETE Thomas D. Budd, President & CEO Assets: $523 Million (as of 6/30 /19 ) Population: 336,116 Market Deposits: $6.2 Billion Ranked 7 th with 7.1% market share and $453 million in deposits in Rockford MSA Major Employers Fiat Chrysler Automobiles Mercyhealth Rock
Slide 34: Wealth Management
34 a relationship driven organization. ® $4.9 $5.7 $6.1 $6.2 $7.2 $8.7 $6.6 $7.2 $2.6 $2.8 $3.0 $3.0 $3.9 $4.7 $3.0 $5.4 $7.5 $8.5 $9.1 $9.2 $11.1 $13.4 $9.6 $12.6 2013 2014 2015 2016 2017 2018 YTD 9/30 2018 YTD 9/30 2019 Trust Department Investment Advisory $1.6 $1.7 $1.7 $1.9 $2.6 $2.7 $2.8 $0.6 $
Slide 35: Correspondent Banking and Specialty Finance Group
35 a relationship driven organization. ® CORRESPONDENT BANKING AND SPECIALTY FINANCE GROUP Source: Company documents. Loan Sale Income Swaps Correspondent Banking ▪ Competitively positioned with experienced staff, software systems and processes ▪ 195 relationships in IL, IA and WI with significant o
Slide 36: GAAP to Non-GAAP Reconciliations
36 a relationship driven organization. ® GAAP TO NON - GAAP RECONCILIATIONS (1) Net interest margin (TEY) is a non - GAAP financial measure. The Company's management utilizes this measurement to take into account the tax benefit associated with certain loans and securities. It is also standard indus
Slide 37: GAAP to Non-GAAP Reconciliations (Cont.)
37 a relationship driven organization. ® GAAP TO NON - GAAP RECONCILIATIONS (CONT.) (1) This ratio is a non - GAAP financial measure. The Company's management believes that this measurement is important to many in vestors in the marketplace who are interested in changes period - to - period in commo
Slide 38: GAAP to Non-GAAP Reconciliations (Cont.)
38 a relationship driven organization. ® GAAP TO NON - GAAP RECONCILIATIONS (CONT.) As of (dollars in thousands, except per share data) September 30, June 30 March 31 December 31, September 30, GAAP TO NON - GAAP RECONCILIATIONS 2019 2019 2019 2018 2018 TANGIBLE COMMON EQUITY TO TANGIBLE ASSETS RATI
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39 a relationship driven organization. ® This page intentionally blank
Slide 40: 3551 Seventh Street Moline, IL 61265 www.qcrh.com © Copyright 2019 QCR Holdings, Inc. All
3551 Seventh Street Moline, IL 61265 www.qcrh.com © Copyright 2019 QCR Holdings, Inc. All Rights Reserved