Bankwell Financial Group, Inc. · NASDAQ:BWFG
Bankwell Financial — Q1 2020 Earnings Presentation
28 slides from Bankwell Financial's earnings presentation, Apr 30, 2020
Slide 1: Bankwell Financial Group 1Q20 Investor Presentation
Bankwell Financial Group 1Q20 Investor Presentation
Slide 2: Safe Harbor
Safe Harbor This presentation may contain certain forward-looking statements about Bankwell Financial Group, Inc. (the “Company”). Forward-looking statements include statements regarding anticipated future events and can be identified by the fact that they do not relate strictly to historical or cur
Slide 3: Table of Contents
Table of Contents • Executive Summary • COVID-19 • 1Q20 Performance • Credit & Capital Impact of COVID-19 • Portfolio Overview • Bankwell History & Overview 3
Slide 4: Executive Summary
Executive Summary • Pre-tax pre-provision net revenue of $4.70 million, equal to prior quarter • Liability-sensitive balance sheet drives NIM expansion as deposit costs decrease • Welcomed new Chief Banking Officer, Matthew McNeill, to the Leadership Team • Minimal direct exposure to higher risk ind
Slide 5: COVID-19 Response
COVID-19 Response Rapid response to unfolding pandemic, including preparation for potential next wave Facilities, Security & Employees Customers Community Technology • No furlough or termination • Granted payment deferrals • Additional financial • Additional cyber-security actions; all employees to
Slide 6: 1Q20 Performance
1Q20 Performance
Slide 7: 1Q20 Summary
1Q20 Summary • Reported 1Q20 Net Income of $1.36 million, or $0.17 per share • $0.30 reduction in EPS due to incremental COVID-19-related provision • Pre-tax, pre-provision net revenue of $4.70 million, or $0.60 per share1 • 1Q20 Net Interest Margin (“NIM”) of 2.98%, a 6 basis points expansion compa
Slide 8: 1Q Consolidated Financial Statements Linked Quarter
1Q Consolidated Financial Statements Linked Quarter Dollars in millions, except per share data Income Statement 1Q20 4Q19 Var1 Balance Sheet 1Q20 4Q19 Var1 Total Interest Income $20.1 $19.9 $0.2 Cash & Cash Equivalents $210 $78 $132 Total Interest Expense $6.8 $7.1 $0.2 Investment Securities $101 $1
Slide 9: Deposit & Borrowing Trends
Deposit & Borrowing Trends Dollars in millions • Liability-sensitive balance sheet well Deposit Balances positioned to capture benefits of lower short- Checking Savings term rates Money Market Time Deposits $1,681 • Impact of 2020 rate reductions on non- $1,800 $1,502 $1,492 maturity deposits to yie
Slide 10: Loan Portfolio Trends
Loan Portfolio Trends Dollars in millions Loan Portfolio Yields • Loans grew $16 million in 1Q20 $1,800 5.00% ̶ Driven by $48 million of funded 4.64% 4.58% 4.48% 4.45% 4.38% 4.50% originations and additional line $1,700 draws of $21 million (~44% $1,605 $1,604 $1,621 4.00% $1,600 construction relate
Slide 11: Tangible Book Value
Tangible Book Value • Bankwell utilizes interest rate swaps to manage its interest rate risk • The interest rate swaps are marked to market each quarter, with the unrealized gains or losses recognized in Other Comprehensive Income (“OCI”) • In 1Q20, falling long term interest rates have increased th
Slide 12: Financial Snapshot
Financial Snapshot 1Q20 excl. Dollars in thousands, except per share data 2016 2017 1 2018 2019 1Q20 COVID-19 2 Total assets $1,628,919 $1,796,607 $1,873,665 $1,882,182 $2,053,625 $2,056,008 Net loans $1,343,895 $1,520,879 $1,586,775 $1,588,840 $1,602,146 $1,605,163 Loan-to-deposit ratio 105.6% 110.
Slide 13: Credit & Capital Impact of COVID-19
Credit & Capital Impact of COVID-19
Slide 14: Strong Asset Quality
Strong Asset Quality Dollars in thousands Non Performing Loans / Gross Loans 0.66% 0.88% SBA-guaranteed portion 0.29% of NPLs ($4.6MM) 0.66% 0.66% 0.36% 0.37% Core NPL exposure 2017 2018 2019 1Q20 NPLs $5,481 $14,082 $10,588 $10,654 Quarry Loans1 $0 $6,943 $1,863 $1,863 1Q20 Detail • The Quarry Loan
Slide 15: ALLL Update
ALLL Update Dollars in thousands Allowance for Loan Loss (“ALLL”) Trends • Bankwell is not subject to CECL and 1.23% General Reserve ALLL is calculated under the incurred 0.01% COVID-19 loss model Specific Reserve 1.03% 0.96% 0.03% 0.02% • 1Q20 provision includes $132 0.84% 0.19% 1.22% thousand rela
Slide 16: COVID-19 Relief Requests
COVID-19 Relief Requests Dollars in millions Total Portfolio • While this population has requested relief, Request for Loan $ Assoc. Total it does not reflect any assessment of future Loan Type Relief w/Requests Outstanding % of Total credit losses CRE excl. SBA 90 $200 $1,126 18% C&I excl. SBA 18 $
Slide 17: Capital Position
Capital Position Key Capital Ratios 1 • $50+ million of additional 13.13% Total Capital above ‘well 13.35% capitalized’ Total Capital Total 1 • This estimate represents 12.14% the magnitude of credit CET1 12.53% Tier 1 Tier / costs BWFG could CET1 Tier 1 withstand and is NOT an 1 estimate of what th
Slide 18: Portfolio Overview
Portfolio Overview
Slide 19: Total Loan Portfolio
Total Loan Portfolio Consumer Loans / Other Commercial 0.57% Const. Residential 6.64% • Portfolio oversight 8.03% provided by team of 28 C&I relationship managers, 14.97% credit analysts and portfolio managers • Well diversified portfolio; CRE Owner no single relationship Occupied represents more th
Slide 20: CRE Loan Portfolio
CRE Loan Portfolio 1 Total CRE Portfolio = Special Use Industrial Select details of Retail and Office segments $1,131 million 3.13% Warehouse 11.06% Retail Composition Count $MM % LTV3 Mixed Use Retail2 82 $202 61.3% 64% Retail 9.10% 29.07% Grocery 10 $74 22.4% 61% Pharmacy 8 $27 8.1% 66% MultiFamil
Slide 21: CRE Loan Portfolio Geography
CRE Loan Portfolio 1 Geography Distribution Loan To Value 3 MS Property Type $MM LTV NC 1.53% Office $346.5 65.9% 1.60% PA All Other Retail $328.9 63.9% 1.74% 9.80% Industrial/Warehouse $125.1 61.5% NJ Multifamily $119.6 67.5% 2.12% Mixed Use $102.9 64.2% Special Use $35.5 61.8% NY 1-4 Family Invest
Slide 22: C&I Loan Portfolio
C&I Loan Portfolio • C&I portfolio has minimal Loans by Industry Type exposure to the following Transport/Warehouse industries (each industry < 2% Professional, Sci & Tech Services $4 million) : 2% All Other 12% ̶ Accommodation & Food Admin & Support, Waste Management, Remediation Services Services
Slide 23: Commercial Construction Portfolio
Commercial Construction Portfolio • Commercial construction loans comprise < By Property Type 7% of total loan portfolio (~$108 million) Medical Special Use Office 3% General Condo 2% 1% • $67 million of unfunded commitments, Self Storage Land 4% committed construction draws are subject 4% to variou
Slide 24: Residential Portfolio
Residential Portfolio Loan Vintage • Bankwell exited the residential mortgage business at the end of 2017 Year $ MM Distribution Pre 2013 $41.7 30% • Of the $139 million in the Residential 2013 $20.5 15% portfolio, $9 million are HELOCs 2014 $15.9 11% 2015 $18.2 13% • The remaining $130 million of r
Slide 25: Bankwell History & Overview
Bankwell History & Overview
Slide 26: Bankwell Profile
Bankwell Profile Company Overview NASDAQ: BWFG • Connecticut-based $2.1 billion bank, with focus on CRE and C&I lending • 12 existing branches in Fairfield & New Haven Counties • Excluding the 3 branches opened in 2Q18, BWFG has $159 million deposits per branch; highest in Fairfield & New Haven Coun
Slide 27: Experienced Leadership Team
Experienced Leadership Team Years Name Experience Selected Professional Biography Christopher Gruseke 30+ Mr. Gruseke was a founding investor and director of Bankwell Financial Group’s predecessors, BNC Financial President & CEO Group, Inc., and The Bank of New Canaan. He brings more than 30 years o
Slide 28: Thank You & Questions
x Thank You & Questions
Bankwell Financial Group — Q1 2020 Earnings Presentation on 6ix