Mid Penn Bancorp · NASDAQ:MPB
Mid Penn Bancorp — IPO Roadshow (April 2021)
32 slides from Mid Penn Bancorp's IPO roadshow presentation, Apr 29, 2021
Slide 1: Common Equity Follow-On Offering April 2021
Exhibit 99.2 DRAFT 04.07.2021 MID PENN BANCORP, INC. Common Equity Follow-On Offering April 2021 1Exhibit 99.2 DRAFT 04.07.2021 MID PENN BANCORP, INC. Common Equity Follow-On Offering April 2021 1
Slide 2: Disclosure and Forward Looking Statements
DISCLOSURE AND FORWARD LOOKING STATEMENTS This presentation is solely for informational purposes and has been prepared to assist interested parties in making their own evaluation of Mid Penn Bancorp, Inc. (the “Company”) and does not purport to contain all of the information that may be relevant. Th
Slide 3: Offering Summary
Offering Summary Issuer: Mid Penn Bancorp, Inc. Offering: Follow-on common stock Gross Amount Offered: $65 million Over-Allotment Option: 15% Exchange / Symbol: NASDAQ GM: MPB To increase capital structure, support the continued growth of our franchise and other general corporate purposes. We may al
Slide 4: Franchise Snapshot
Franchise Snapshot Attractive footprint with large, affluent segments in both urban and suburban communities. Franchise Highlights • Banking subsidiary: Mid Penn Bank, (est. 1868) state chartered non member bank and trust company, headquartered in Millersburg, PA • A PA based commercial bank operati
Slide 5: Franchise Snapshot: Corporate Structure
Franchise Snapshot: Corporate Structure Mid Penn Bancorp, Inc. Mid Penn Bank MPB Financial Services ü Consumer Banking ü Commercial Banking MPB Wealth MPB Risk MPB Management ü Trust and Wealth Management Services ü High / Ultra-High-ü Property & Casualtyü Tax Advisory Net Worth ü Retail Brokerage ü
Slide 6: Franchise Snapshot: Financial Highlights
Franchise Snapshot: Financial Highlights Market Statistics Financial Highlights 3 MRQ ROAA 1.19% Mkt. Cap $215M 3 MRQ ROAE 14.58% Div. Yield 3.13% MRQ NIM 3.46% NPAs / Assets 0.26% Current Annual $0.80 Dividend MRQ NCOs / Avg. 0.03% 3 Loans 1 TCE / TA 5.95% 1 P / TBV 109% Total Capital 12.50% P / 20
Slide 7: Experienced Management Team
Experienced Management Team RORY RITRIEVI Chief Executive Officer Mr. Rory G. Ritrievi joined Mid Penn B ank and parent company Mid Penn Bancorp, Inc. in 2009 as President and Chief Executive Officer. Prior to joining Mid Penn, Mr. Ritrievi s erved as Market President and Chief Lending Officer of Co
Slide 8: 2020 Highlights
2020 Highlights Selected Highlights Key Statistics 1 • Organic loan growth (excluding PPP and mortgage loans held for sale) of over 13%; (organic loan growth CAGR of 23.3% 2016 - 2020) • Originated over 4,100 PPP loans totaling ~$630 million of principal Balance balance • Deposits grew at a rate of
Slide 9: Q1 2021 Highlights
Q1 2021 Highlights Selected Highlights Key Statistics 1 • Organic loan growth (excluding PPP and mortgage loans held for sale) of $60.5 million, representing an annualized growth rate of over 12% • Originated over 2,800 PPP loans totaling over $350 million of principal Balance balance • Deposits gre
Slide 10: Investment Highlights
Investment Highlights Experienced management team focused on driving franchise value Long track record and demonstrated ability to drive balance sheet growth Complimentary markets of operation provide low cost, stable deposits and higher growth lending opportunities Proven ability to acquire and suc
Slide 11: Compelling History of Organic and M&A based Growth
Compelling History of Organic and M&A based Growth • Infrastructure investments from 2009 – 2014 paved the way for a successful run of organic and acquired growth • Three successful bank acquisitions from 2015 to 2018 added over $1 billion in assets while diversifying and expanding our markets of op
Slide 12: Demonstrated Ability to Drive Balance Sheet Growth
Demonstrated Ability to Drive Balance Sheet Growth 1 Total Assets ($M) Gross Loans ($M) $3,382 $2,999 $2,646 $2,384 $2,231 $2,078 $1,763 $1,624 $1,170 $1,033 $910 $814 2016 2017 2018 2019 2020 1Q21 2016 2017 2018 2019 2020 1Q21 2 Total Deposits ($M) Core Loans ($M) $1,805 $1,719 $2,667 $2,475 $1,348
Slide 13: Markets of Operation: Low Cost, Stable Deposits and Higher Growth Lending
Markets of Operation: Low cost, Stable deposits and Higher Growth Lending Opportunities Capital Southeast, PA Western, PA % of Franchise 66% 24% 10% % Proj. Population Change 1.3% 0.5% (2.0%) (’21 – ’26) Median HH Income $62,744 $89,160 $61,189 % Proj. HH Income Change 9.5% 9.4% 7.9% (’21 – ’26) ü S
Slide 14: Markets of Operation: Significant Player in Harrisburg Market
Markets of Operation: Low cost, Stable deposits and Higher Growth Lending Opportunities Significant Player in the Harrisburg Market Rapid Growth in Attractive Southeastern PA Markets Harrisburg Metropolitan Statistical Area (MSA) Year-over-Year Deposit Growth Deposit Market Share Berks County Cheste
Slide 15: Proven Ability to Acquire and Successfully Integrate Franchises
Proven Ability to Acquire and Successfully Integrate Franchises Transaction History Deal Value Target Total Assets Purchase Price / TBV MPB Issue Price / TBV Announcement Date ($M) ($M) (%) (%) Target Company 1/16/2018 $90.7 $612 1 .9x 2 .2x 3/29/2017 59.1 263 1 .3x 1 .7x 8/27/2014 14.5 141 1 .1x 1
Slide 16: Strategic Initiatives to Drive Profitability and Shareholder Returns
Strategic Initiatives to Drive Profitability and Shareholder Returns Leveraging the Mortgage Banking Platform Average Branch Size Mortgage Division Benefited from Rate Environment and Our Ability MPB has Significant Opportunity to Create Additional Efficiencies to Monetize Customer Relationships Thr
Slide 17: Outperforming Peers as Asset Quality Continues to Improve
Outperforming Peers as Asset Quality Continues to Improve Key Highlights NCOs / Avg. Loans • Asset quality has been historically strong MPB PA Banks $1B-$5B Assets • MPB recorded a $4.2 million provision for loan losses in 2020 0.12% despite limited charge-offs of $333 thousand 0.10% 0.09% 0.11% 0.0
Slide 18: History of Consistent Earnings, Dividend and Book Value Growth
History of Consistent Earnings, Dividend and Book Value Growth 1 1 Diluted Earnings Per Share Dividends Per Share $3.10 $0.79 $0.77 $0.70 $2.09 $0.62 $1.85 $0.58 $1.67 $1.48 $1.10 $0.24 2016 2017 2018 2019 2020 1Q21 2016 2017 2018 2019 2020 1Q21 Tangible Book Value Per Share (Non-GAAP) Book Value Pe
Slide 19: Long History of Enhancing Shareholder Value
Long History of Enhancing Shareholder Value Franchise Growth With Superior Resulting in Superior & Expansion Top-Line Growth Value Creation Compound Tangible Book Value per Share Revenue per Common Share Total Asset Growth + Dividends (Non-GAAP) MPB National Peers MPB National Peers MPB National Pee
Slide 20: Strategic Initiatives Going Forward
Strategic Initiatives Going Forward Core Loan Production • Generate low double digit annual loan growth • Continue to convert new “PPP” customers into commercial relationships • Attract and retain high quality commercial lenders Southeast PA Market Development • Leverage position and brand to meanin
Slide 21: Financial Overview
Financial Overview 21Financial Overview 21
Slide 22: Accelerated Historical Profitability
Accelerated Historical Profitability 1 1 Return on Average Assets Return on Average Equity MBP PA Banks $1B-$5B Assets MBP PA Banks $1B-$5B Assets 14.58% 1.19% 1.01% 0.95% 0.94% 10.71% 10.76% 10.54% 9.98% 9.48% 0.83% 0.69% 0.87% 0.82% 9.14% 0.78% 8.37% 7.67% 0.64% 0.63% 7.11% 5.98% 2016 2017 2018 20
Slide 23: Diversified Loan Portfolio
Diversified Loan Portfolio 1 Loan Portfolio Composition ($000s) March 31, 2021 Commercial & Loan Type Balance % Total CRE - Industrial Construction Commercial Real Estate $1,135,660 42.9% 36% 10% Commercial & Industrial 964,045 36.4 Residential CRE - Construction 264,945 10.0 Mortgage 8% Residential
Slide 24: PPP Program Results
PPP Program Results Significant PPP success • We originated over 6,900 PPP loans, totaling over $980 million • Our participation in the PPP program helped to protect over 80,000 jobs in the community • As of March 31, 2021, we had ~$590 million of PPP loans outstanding, net of deferred fees, or ~22%
Slide 25: Core Deposit Franchise
Core Deposit Franchise Stable & Growing Deposit Composition Interest-Bearing ($000s) March 31, 2021 Noninterest- Demand Bearing Deposit Type Balance % Total 23% Demand 25% Money Market $770,800 28.9% Noninterest-Bearing Demand 676,717 25.4 Retail Time Interest-Bearing Demand 601,220 22.5 13% Retail
Slide 26: Well Capitalized: Consolidated Capital Overview
Well Capitalized: Consolidated Consolidated Capital Overview Tier 1 Leverage Tier 1 RBC Total RBC 12.6% 12.5% 12.3% 11.9% 11.3% 11.0% 10.0% 9.8% 9.7% 9.6% 9.1% 8.5% 8.0% 7.8% 6.8% 6.8% 6.7% 6.5% 2016 2017 2018 2019 2020 1Q21 Both MPB and Mid Penn Bank have consistently maintained regulatory capital
Slide 27: Appendix
Appendix 27Appendix 27
Slide 28: Historical Balance Sheet
Historical Balance Sheet ($000s) As of December 31, x March 31, Assets 2016 2017 2018 2019 2020 2021 Total Cash and Cash Equivalents $45,973 $23,514 $40,065 $139,030 $303,724 $427,371 Available for Sale Securities 133,625 93,465 111,923 37,009 5,748 3,250 Held to Maturity Securities - 101,356 168,37
Slide 29: Historical Income Statement
Historical Income Statement ($000s) As of or for the year ended December 31, x March 31, 1 2016 2017 2018 2019 2020 2021 Interest Income $40,212 $43,892 $68,654 $95,312 $107,935 $29,168 Interest Expense 5,367 6,304 12,720 25,164 19,727 3,843 Net Interest Income $34,845 $37,588 $55,934 $70,148 $88,20
Slide 30: Non-GAAP Reconciliation
Non-GAAP Reconciliation ($000s) As of December 31, x As of March 31, 2016 2017 2018 2019 2020 2021 Total Common Equity $70,467 $75,703 $223,209 $237,874 $255,688 $264,036 Goodwill 3,918 3,918 62,840 62,840 62,840 62,840 Other Intangibles 539 434 7,221 5,758 4,360 4,079 Less: Total Intangible Assets
Slide 31: COVID-19 Related Loan Deferrals and Improvement
COVID-19 Related Loan Deferrals and Improvement 1 Loan Deferrals (#) 1,019 921 102 12 7 April 24, June 30, Sept. 30, Dec. 31, March 31, 2020 2020 2020 2020 2021 1 1 Loan Deferrals ($M) Loan Deferrals / Gross Loans 22.8% $444.9 $409.7 18.2% $32.9 1.3% $11.7 0.5% $5.1 0.2% April 24, June 30, Sept. 30,
Slide 32: Conservatively Managed Securities Portfolio
Conservatively Managed Securities Portfolio Securities Portfolio Breakdown (As of March 31, 2021) Portfolio Characteristics (As of March 31, 2021) • At March 31, 2021, securities portfolio totaled $134.3 million: U.S. Government Bonds (Incl. • $3.2 million, or 2.4% available-for-sale Treasury) Mortg