Cb Financial Services, Inc. · NASDAQ:CBFV
Cb Financial Services — KBW Community Bank Investor Conference July 2020
26 slides from Cb Financial Services's conference presentation, Jul 28, 2020
Slide 1: Investor Presentation – KBW Community Bank Investor Conference July 2020
Investor Presentation KBW Community Bank Investor Conference July 2020
Slide 2: Forward-looking statements and non-GAAP financial measures
1 Statements contained in this investor presentation that are not historical facts may constitute forward - looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995 (the “Act”) . Such forward - looking statements are subject to significant risks and uncertai
Slide 3: Overview of CB Financial Services, Inc.
2 2 119 year - old community bank headquartered in Southwestern PA listed on NASDAQ with ticker “CBFV” 28 locations in Southwestern PA, Ohio River Valley and Central WV; 2 branches to be consolidated in Q3 2020 Strategic, disciplined acquirer: ► FedFirst Financial in October 2014 ► First West
Slide 4: COVID-19 Responses
3 COVID - 19 Responses Source: Company documents, as of 6/30/20. $70mm SBA - approved volume ~630 SBA - approved loans $112k Average loan size $35k Median loan size 3.5% Average processing fee Paycheck Protection Program Successes Operational Response • Instituted “Community Bank Cares” premium pay
Slide 5: Management team
4 Interim President & CEO; returned to CBFV in January 2020 Previously Vice Chairman and CEO through January 2019 where responsibilities included the strategic direction of the company and day to day oversight Board member of CBFV from 1992 to 2018 and left law practice to become President of
Slide 6: Diversified Business
5 Diversified Business Source: Company documents - (1) For the six months ended 6/30/20. Fee income defined as noninterest income excluding net gains/ losses on investments and other nonrecurring items. Focus on new commercial business generation and sales culture ► Growing presence within the Pit
Slide 7: Pittsburgh MSA market overview
6 Population of approximately 2.3 million with a median household income of nearly $64,000, which is projected to increase 10.2% in the next 5 years Large market for energy, healthcare, technology, and manufacturing companies (1) Highly educated labor force from Carnegie Mellon University, Uni
Slide 8: Strategic Vision for CBFV
7 Empower our experienced, high quality employees to provide superior customer service in all aspects of our business Create a sales and service culture which builds full relationships with our customers Enhance profitability and efficiency while continuing to invest for future growth Contin
Slide 9: Financial Update
ch Financial Update
Slide 10: Financial Update – Q2 2020
9 Diluted EPS for YTD 2020 was $0.68, compared to $1.08 YTD 2019 Net income for 2020 has been impacted by a $2.5 million provision for loan losses in Q1 2020 to build reserves and a declining net interest margin as a result of Federal Reserve rate policy enacted in Q1 2020 as a result of the COV
Slide 11: Deposit Base, Loan Portfolio, Balance Sheet Mix
10 Deposit Base Loan Portfolio Balance Sheet Mix Source: Company documents, as of or for the quarter ended 6/30/20. $1.0 billion in gross loans, 4.21% loan yield in Q2 2020 48% of loans are commercial real estate and C&I; all $70 million PPP classified as C&I 11.4% loan growth year over year v
Slide 12: Balance Sheet Trends: Loans and Deposits
11 Loans Deposits Balance Sheet Trends Source: S&P Global Market Intelligence and company documents, as of 6/30/20. Note: All dollars in millions. Organic loan and deposit growth has continued through Q1 2020 following the FWVB transaction which closed in Q2 2018 Loans HFI were stable quarter ov
Slide 13: CRE Portfolio Exposure by Industry
12 CRE Portfolio Exposure by Industry Note: totals may not sum due to rounding. 1) Risk grade scale is 1 to 8 with 6 being substandard. 2) Excludes $4.6 million in hotels under construction. Selected Sector Insights Retail Commercial Real Estate Senior Housing $84 million outstanding (excludes con
Slide 14: COVID-Exposed Loan Segments
13 COVID - 19 Exposed Loan Segments Source: Company documents, as of 6/30/20. 1) Weighted average risk grade. Risk grade scale is 1 to 8 with 6 being substandard. Loan Portfolio Segmentation Retail 8.6% Multifamily 5.9% Office Space 6.0% Hotels 2.9% Senior Housing 1.9% Oil & Gas 1.8% Restaurants 0.6
Slide 15: Hotel Portfolio Insight
14 Hotel Portfolio Insight 1) Risk grade scale is 1 to 8 with 6 being substandard. Wyndham 38% Marriott 26% Choice 16% Hilton 9% Holiday Inn 6% Other 5% $30mm Total Hotel Exposure by Flag Approximately $29.8 million outstanding as of June 30, 2020 26% of total risk based capital 95% nationally
Slide 16: Forbearance Detail
15 Forbearance Detail Expiration of Deferral Period by Month ($000) Weighted average risk grade of commercial deferrals is 4.1 (scale to 8; 6 is substandard) Initial deferral structure offered to commercial customers was 90 days of principal interest deferral 63% of initial deferral periods ex
Slide 17: Strong Asset Quality & Coverage
16 NPAs / Assets and Criticized Loans / Loans Allowance for Loan Losses / Gross Loans Net Charge Offs / Average Loans Strong Asset Quality & Coverage Source: S&P Global Market Intelligence and company documents, as of 6/30/20. Criticized loans equals special mention plus substandard plus doubtful gr
Slide 18: Liquidity & Capital
17 U.S. Gov. Agency 13% Obligations of States & Political 15% GSE MBS 71% Marketable Equities 1% Liquidity & Capital Source: Company documents, as of 6/30/20. Source $mm Cash & Equivalents $131.4 FHLB Borrowing Capacity $399.3 FRB Discount Window Availability $90.4 Unencumbered Securities $10.0 Unco
Slide 19: Net Interest Margin Analysis
18 Net Interest Margin Analysis Interest Rate Sensitivity Profile Net Interest Margin Source: S&P Global Market Intelligence and company documents, as of 6/30/20. NIM declined 27bps to 3.30% in Q2 2020 with a full quarter of the impact of the Federal Reserve interest rate moves as a result of the
Slide 20: Revenue Diversification
19 Deposit Fees & Service Charges 25% Insurance Commissions 54% Other Noninterest Income 21% Fee Income Mix – YTD 2020 Fee income sources comprised approximately 18% of 2020 total operating revenue; provides stable revenue stream Cross - sell efforts, with respect to insurance and wealth managem
Slide 21: Efficiency & Expense Opportunities
20 Non - Interest Expense and Non - Interest Income (1) Efficiency & Expense Opportunities Source: S&P Global Market Intelligence and company documents, as of 6/30/20. (1) Noninterest expense excludes merger charges of $854,000 and $356,000 in 2018 and 2017, respectively. (2) Non - GAAP financial me
Slide 22: Profitability Trends
21 Return on Average Assets & PTPP ROAA (1) Return on Average Tangible Common Equity (1) Profitability Trends Source: S&P Global Market Intelligence and company documents, as of 6/30/20. (1) Non - GAAP financial metric. Please see the appendix to view this presentation for Non - GAAP reconciliations
Slide 23: Questions?
ch Questions?
Slide 24: Appendix
ch Appendix
Slide 25: Non-GAAP Reconciliations: TCE Ratio, Tangible Book Value, Efficiency Ratio
24 TCE Ratio and Tangible Book Value Per Share Efficiency Ratio Non - GAAP Reconciliations Source: Company documents, as of 6/30/20. (dollars in thousands) For the Years Ended 6 Months Ended For the Quarter Ended 2017 2018 2019 6/30/19 6/30/2020 9/30/19 12/31/19 3/31/20 6/30/20 GAAP Non Interest Exp
Slide 26: Non-GAAP Reconciliations: ROATCE and PTPP ROAA
25 Return on Average Tangible Common Equity Non - GAAP Reconciliations Source: Company documents, as of 6/30/20. Pre - Tax, Pre - Provision ROAA (dollars in thousands) For the Years Ended For the Six Months Ended 2017 2018 2019 6/30/19 6/30/20 GAAP Income Before Tax Expense $9,818 $8,590 $16,056 $7,
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