First Western Financial, Inc. · NASDAQ:MYFW
First Western Financial — Shareholder Meeting (June 2020)
25 slides from First Western Financial's shareholder meeting presentation, Jun 8, 2020
Slide 1: 2020 Annual Meeting of Shareholders
First Western Financial, Inc. The First, Western-Based Private Trust Bank 2020 Annual Meeting of Shareholders
Slide 2: Safe Harbor
Safe Harbor 2 This presentation contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements reflect the current views of First Western Financial
Slide 3: 2019 Overview
2019 Overview Continued Growth and Expansion Strong Financial Performance .. Book value and tangible book value per common share increased 9.6% and 14.3%, respectively, in 2019(1) .. MYFW stock price increased 37.9% during 2019 Strong Value Creation .. AUM increased 18% driven by $300 million in new
Slide 4: Strong Performance Creating Shareholder Value
Strong Performance Creating Shareholder Value 4 $11.50 $11.88 $12.38 $12.83 $13.15 $11.00 $12.00 $13.00 $14.00 12/31/2018 3/31/2019 6/30/2019 9/30/2019 12/31/2019 MYFW TBV/Share
Slide 5: Improving Earnings Drove Outperformance in 2019
Improving Earnings Drove Outperformance in 2019 5 Source: S&P Global Market Intelligence
Slide 6: Key Financial Trends
Ww Figstwestern Key Financial Trends
Slide 7: Emerging From a Cycle of Capital Constraint
$110 $159 $327 $433 $478 $525 $509 $485 $533 $610 $673 $814 $894 $998 $1,044 $102 $147 $270 $407 $472 $530 $596 $561 $589 $710 $754 $816 $938 $1,087 $1,178 $1,256 $1,378 $2,133 $3,057 $4,119 $4,042 $3,952 $4,523 $4,842 $4,744 $4,926 $5,374 $6,188 $5,636 $0 $1,000 $2,000 $3,000 $4,000 $5,000 $6,000 $
Slide 8: Net Income Available to Common Shareholders and Earnings per Share
$0.21 $0.33 $0.30 $0.32 $0.22 $0.15 $0.05 $- $0.05 $0.10 $0.15 $0.20 $0.25 $0.30 $0.35 $0.40 Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 EPS Adjustments to EPS (1) (1) Net Income Available to Common Shareholders and Earnings per Share 8 Net Income Available to Common Shareholders .. Strong operational a
Slide 9: Loan Portfolio
$929 $966 $990 $1,018 $1,054 $1,045 $1,107 1Q19 2Q19 3Q19 4Q19 1Q20 4Q19 1Q20 HFI HFS Average Period End Loan Portfolio 9 Loan Portfolio Composition(1) .. Total loan growth of 15% in 2019 .. Strong loan production offset increase in payoffs/paydowns .. Balanced growth across C&I, CRE and 1-4 family
Slide 10: Total Deposits
$981 $967 $1,042 $1,092 $1,085 $1,087 $1,178 1Q19 2Q19 3Q19 4Q19 1Q20 4Q19 1Q20 Average Period End Total Deposits 10 Deposit Portfolio Composition .. Total deposits increased 16% in 2019 .. Growth primarily driven by increase in money market accounts .. Continued improvement in deposit mix .. Strong
Slide 11: Asset Quality
Asset Quality 11 Non-Performing Assets/Total Assets .. Steady decline in NPAs/Total Assets .. Minimal charge-offs in 2019 .. Asset quality remained strong in 1Q20 despite the impact of COVID-19 pandemic Net Charge-Offs/Average Loans 0.00% 0.00% 0.00% 0.03% 0.00% 0.00% 0.20% 0.40% 0.60% 0.80% 1.00% Q
Slide 12: Accelerating Business Development Trends
Accelerating Business Development Trends 12 New Loan Production Net Deposit Growth Capital raised in July 2018 IPO has allowed for increased business development activities… $227.9 $268.2 $225.6 $317.9 2016 2017 2018 2019 $44.0 $62.2 $121.6 $149.0 2016 2017 2018 2019
Slide 13: Increased Scale and Back-Office Streamlining Driving Improved Efficiencies
Increased Scale and Back-Office Streamlining Driving Improved Efficiencies 13 90.4% 88.2% 85.4% 80.6% 2016 2017 2018 2019 Efficiency Ratio(1) 54.5% 55.2% 57.8% 56.6% 2016 2017 2018 2019 Percentage of Revenue Generating FTEs (1) See Non-GAAP reconciliation
Slide 14: COVID-19 Impact Overview
Ww Figstwestern COVID-19 Impact Overview
Slide 15: Operational Response
Operational Response 15 .. Business Continuity Plan activated in early February .. Daily meeting of Pandemic Response Team .. All offices open and functioning; client service by appointment only .. 90% of associates working from home routinely, 100% enabled .. All client and support operations fully
Slide 16: Client Engagement and Support Overview
Client Engagement and Support Overview Trust and Investment Management Banking .. Active client calling program to assess impact of COVID-19 .. All credits placed into risk categories based on data gathered .. Loan modification program, including payment deferrals, extensions and financial covenant
Slide 17: Paycheck Protection Program Key Data Points
Paycheck Protection Program 17 Key Data Points .. $208.3 million in PPP loans, 20% of March 31st gross loans .. 573 loans approved .. 51% of PPP loans provided to existing clients; 49% provided to new clients .. Median loan size of $92,500 .. PPP loans expected to generate $5.4 million of fee income
Slide 18: Creating Additional Shareholder Value
Creating Additional Shareholder Value
Slide 19: Revenue Growth Strategies
19 Revenue Growth Strategies • Building expertise in specific vertical markets • Launched medical and dental practice group in 1Q20 • Replicate same model in additional vertical markets Expand commercial loan production platform • Vail Valley office opened in 2019 • Building team to focus on Broomfi
Slide 20: Highly Accretive Branch Purchase and Assumption Expands Denver Presence
Highly Accretive Branch Purchase and Assumption Expands Denver Presence 20 .. Acquisition of all of the Denver locations of Simmons Bank (three branches and one loan production office) Three of the locations will be consolidated into an existing First Western branch .. Assumed $63 million in depos
Slide 21: Near-Term Outlook and Expectations
Near-Term Outlook and Expectations 21 .. Excluding impact of PPP loans, NIM should continue to expand, while fee income should normalize .. Decrease in non-recurring expenses for Q2 - expect core NIE of $14-14.5M .. Share repurchase activity on hold during duration of crisis as capital can be better
Slide 22: Long-Term Goals to Drive Shareholder Value
22 Long-Term Goals to Drive Shareholder Value Our mission is to be the BPBFWWMC – Best Private Bank for the Western Wealth Management Client We believe First Western can be a unique, niche focused regional powerhouse with high fee income and consistent strong earnings from our scalable wealth manage
Slide 23: Non-GAAP Reconciliations
Ww Figstwestern Non-GAAP Reconciliations
Slide 24: Non-GAAP Reconciliation: Adjusted Net Income
24 Non-GAAP Reconciliation Adjusted Net income For the Twelve Months Ended, (Dollars in thousands) December 31, 2018 December 31, 2019 Net income $5,647 $8,009 Plus: goodwill impairment including tax impact - 1,182 Plus: loss on intangible HFS including income tax impact Adjusted net income $5,647 $
Slide 25: Non-GAAP Reconciliation: Tangible Common Book Value Per Share
25 Non-GAAP Reconciliation Consolidated Tangible Common Book Value Per Share As of the Three Months Ended, (Dollars in thousands) December 31, 2018 March 31, 2019 June 30, 2019 September 30, 2019 December 31, 2019 Total shareholders' equity $116,875 $119,668 $122,157 $125,732 $127,678 Less: Goodwill
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