Financial Institutions, Inc. · NASDAQ:FISI
Financial Institutions — IPO Roadshow (May 2017)
23 slides from Financial Institutions's IPO roadshow presentation, May 15, 2017
Slide 1: Investor Presentation May 15, 2017
Issuer Free Writing Prospectus Dated May 15, 2017 Filed Pursuant to Rule 433 Registration Statement No. 333-202791 NASDAQ: FISI Investor Presentation May 15, 2017
Slide 2: Offering Disclosure and Safe Harbor Statement
Offering Disclosure and Safe Harbor Statement This presentation has been prepared by Financial Institutions, Inc. (“FISI” or the “Company”) solely for informational purposes based on its own information, as well as information from public sources. This presentation has been prepared to assist intere
Slide 3: Offering Summary
Offering Summary Issuer: Financial Institutions, Inc. Offering: Follow-on offering of common stock Gross Amount Offered: $40 million (100% primary) Over-Allotment Option: 15% (100% primary) Exchange / Symbol: NASDAQ Global Select / FISI Market Capitalization(1): $479 million Current Quarterly Divide
Slide 4: Overview of Financial Institutions, Inc.
Overview of Financial Institutions, Inc. Corporate Overview Key Corporate Statistics as of March 31, 2017 Diversified financial services holding company Assets: $3.86 billion headquartered in Western New York Loans: $2.40 billion Subsidiaries include: Deposits: $3.17 billion – Five Star Bank (region
Slide 5: Reasons to Invest
Reasons to Invest Dividends & Tangible Common Book Value $15.62 Market Disruption Creating Growth Opportunities $14.77 $0.81 Addition of Talent is Fueling Activity and $13.71 $0.80 $13.56 Driving Growth $0.77 $0.74 History of Strong Operating Results and 2013 2014 2015 2016 Positive Balance Sheet Tr
Slide 6: Successfully Executing Long-Term Strategy
Successfully Executing Long-Term Strategy Maximize Market Disruption Opportunities – Continue to capitalize on market disruption in Western New York banking – Leverage brand to expand in the larger markets of Buffalo and Rochester – Continue to strengthen bench through strategic hires Generate Above
Slide 7: Experienced Leadership Team
Experienced Leadership Team Deep Bench with Significant Experience Working in Rochester, Buffalo and all of Western NY Years Years in Name Title with FISI Banking Martin K. Birmingham President and Chief Executive Officer 12 27 Kevin B. Klotzbach EVP,Chief Financial Officer and Treasurer 15 33 Willi
Slide 8: Market Footprint Growth Opportunities Buffalo and Rochester
Market Footprint Growth Opportunities Buffalo and Rochester Current market share of 3.6% (1) in attractive $32 billion combined local deposit markets Rochester – Five Star Bank presence and brand awareness growing Buffalo • Four financial solution centers opened Warsaw since November 2015 – Market d
Slide 9: Buffalo and Rochester Economic Environment
Buffalo and Rochester Economic Environment Financially stable with positive outlook Key employer transition from manufacturing to small business, technology and professional services Significant college and university presence, including academic medical centers with robust research and development
Slide 10: Addition of Talent
Addition of Talent Taking advantage of market disruption to upgrade talent across all segments of our business – Hiring experienced professionals from competing institutions – Choosing community banking environment vs. big bank experience – Bringing market experience, knowledge and relationships Exp
Slide 11: Evolving to Meet Changing Customer Needs
Evolving to Meet Changing Customer Needs Financial solution center concept illustrates how we are evolving to meet the needs of our customers High level of personalized banking Staffed by Certified Personal Bankers (CPBs) — experts trained to meet a broad array of customer needs Smaller footprint th
Slide 12: Strong Operating Results and Positive Balance Sheet Trends
Strong Operating Results and Positive Balance Sheet Trends Net Income Net Interest Income & Noninterest Income ($ in millions) ($ in millions) $35.8 $25.4 $30.3 $24.8 $102.7 $91.6 $93.8 $95.3 $29.4 $31.9 $28.3 $25.5 25.8% 24.1% $7.8 $7.9 21.3% 21.3% $27.0 2013 2014 2015 2016 1Q '17 2013 2014 2015 20
Slide 13: Noninterest Income Commentary
Noninterest Income Commentary ($ in millions) Bank Fees/Income – Various initiatives underway to increase credit card revenues – New purchasing card program $35.8 – Increased focus on sale of cash management $30.3 $24.8 $25.4 services $7.8 – Anticipate increase in mortgage-related fees with build-ou
Slide 14: Loan and Deposit Composition
Loan and Deposit Composition Total loans increased 13.6% from March 31, 2016 – Commercial, residential real estate and indirect portfolios increased 15.7%, 7.9% and 15.6%, respectively Total deposits increased 7.1% from March 31, 2016, driven by organic growth – Municipal business continues to grow;
Slide 15: Superior Credit Quality
Superior Credit Quality Nonperforming assets (1) to total assets are well below peers Loan loss reserves as a ratio of nonperforming assets are significantly higher than peers, demonstrating FISI’s conservative underwriting culture and reserve coverage Credit quality reflects our knowledge of our co
Slide 16: Conservative Securities Portfolio
Conservative Securities Portfolio Total Investment Securities at March 31, 2017 Debentures 17.5% Entire portfolio 0% or 20% risk weighted Portfolio comprised of New York State MBS municipals and government agency issued 35.9% MBS, CMO and debentures Modified portfolio duration of 4.45 years CMO $1.0
Slide 17: Historical Capital Position
Historical Capital Position Consolidated Capital Ratios 14.00% 13.35% 7.10% 12.97% 12.75% 13.00% 6.86% 12.08% 6.90% 11.98% 12.00% 11.72% 10.73% 10.82% 6.70% 11.00% 10.47% 10.50% 10.26% 10.11% 6.50% 10.00% 6.51% 6.32% 6.41% 6.25% 9.00% 6.30% 6.16% 8.00% 7.71% 7.63% 7.35% 7.41% 7.36% 7.30% 6.10% 7.00%
Slide 18: Business Line Details: Commercial Banking
Business Line Details: Commercial Banking Commercial BankingQuarterly – Commentary ($ in millions) 0.22% LTM Growth 15.7% 0.30% Strong year-over-year growth in both Commercial $1,100 $1,000 0.04% 0.10% Mortgage (CRE and owner occupied) and (0.01%) $900 Commercial Business (C&I) lending $350 $376 $80
Slide 19: Business Line Details: Consumer Indirect
Business Line Details: Consumer Indirect Consumer Indirect - Quarterly Commentary ($ in millions) LTM Growth 15.6% $786 Consumer indirect is a unique core competency $790 $770 $752 – Experienced management team with average $750 industry experience of 25+ years $730 $730 Loans originate through appr
Slide 20: Business Line Details: Residential Real Estate Loans and Lines
Business Line Details: Residential Real Estate Loans and Lines Commentary ($ in millions) In-market originations through mortgage loan $570 LTM Growth 7.9% $550 $550 $549 originators and Five Star Bank branch network $550 $533 include term loans and lines $530 Product builds relationships and captur
Slide 21: Reasons to Invest
Reasons to Invest Dividends & Tangible Common Book Value $15.62 Market Disruption Creating Growth Opportunities $14.77 $0.80 $0.81 Addition of Talent is Fueling Activity and $13.71 $13.56 Driving Growth $0.77 $0.74 History of Strong Operating Results and 2013 2014 2015 2016 Positive Balance Sheet Tr
Slide 22: Appendix
Appendix Mm Financial Institutions, Inc. , 22
Slide 23: Non-GAAP Reconciliation
Non-GAAP Reconciliation Non-GAAP Financial Information This presentation contains disclosure regarding tangible common book value per share and return on average tangible common equity, which are determined by methods other than in accordance with U.S. generally accepted accounting principles (“GAAP