Rbb Bancorp · NASDAQ:RBB
Rbb Bancorp — Investor Presentation (November 2018)
38 slides from Rbb Bancorp's investor presentation, Nov 28, 2018
Slide 1: November 2018 Investor Presentation
November 2018 Investor Presentation Exhibit 99.1
Slide 2: Forward-Looking Statements
Forward-Looking Statements Certain matters set forth herein (including the exhibits hereto) constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including forward-looking statements relating to RBB’s current business plans, its future fina
Slide 3: RBB Bancorp
RBB Bancorp
Slide 4: Experienced Leadership Team
Experienced Leadership Team Average 32 years of bank management experience in finance, lending, credit, risk, strategy and branch operations Source: Experience: Page 6 in S-1 Background: Pages 143, 145-146 in the S-1 Name / Title Experience Background Yee Phong (Alan) Thian President & Chief Executi
Slide 5: Experienced Leadership Team (continued)
Experienced Leadership Team Average 32 years of bank management experience in finance, lending, credit, risk, strategy and branch operations Source: Experience: Page 6 in S-1 Background: Pages 143, 145-146 in the S-1 Simon Pang Executive Vice President & Chief Credit Officer 36 years (19 years with
Slide 6: RBB Bancorp – Who We Are
Balance Sheet (Dollars in millions) Total Assets $2,137 Total Loans, Including Held for Sale $1,760 Total Deposits $1,565 Tangible Common Equity2 $264 Tangible Common Equity / Tangible Assets2 12.53% NPAs / Assets3 0.32% Profitability Return on Average Assets 1.73% Return on Average Common Equity 11
Slide 7: Investment highlights: high-performing community bank
High-performing community bank with defined and proven strategy to grow both organically and through acquisitions High level of insider ownership and deposit concentration aligns interest with investors Experienced management team and Board of Directors with demonstrated industry knowledge, regulato
Slide 8: Our History and Strategy
September: Acquired July: Acquired January: Established 2011 Our History and Strategy Historical Timeline May: Acquired Received Outstanding Overseas Taiwanese SME Award 2013 Earned Findley Reports’ “Super Premier” status 2015 Opened 2008 Opened SBA banking unit 2010 Raised over $54mm in private off
Slide 9: Our Current Footprint
Our Current Footprint Orange County, California Irvine Branches (22) Los Angeles County, California Clark County, Nevada Ventura County, California Arcadia Cerritos Diamond Bar Los Angeles (Downtown) Los Angeles (Westwood) Los Angeles (Silver Lake) Monterey Park Rowland Heights San Gabriel Torrance
Slide 10: Substantial Opportunities for Acquisitions: Chinese-American Banks Across the U.S.
Substantial Opportunities for Acquisitions: Chinese-American Banks Across the U.S. Chinese-American bank universe as defined by RBB’s management team Count refers to total number of Chinese-American banks that are headquartered in the indicated MSA Source: SNL Financial, 2010 Census Chinese-American
Slide 11: Demonstrated Track Record of Balance Sheet and Earnings Growth
Demonstrated Track Record of Balance Sheet and Earnings Growth Total Assets ($mm) Total Loans ($mm) Total Deposits ($mm) Net Income ($mm) 2012 – Q3 2018 CAGR = 25.6% 2012 – Q3 2018 CAGR = 34.0% 2012 – Q3 2018 CAGR = 24.5% 2012 – 2017 CAGR = 44.8%
Slide 12: Diversified Loan Portfolio
Diversified across industry lines and minimal demand for non-mortgage consumer credit $1.76 billion total loans as of September 30, 2018 93% originated vs. 7% acquired Average yield on loans of 5.83% for the third quarter of 2018 Diversified Loan Portfolio Excludes purchased loan discounts and defer
Slide 13: Business Line Profile
Business Line Profile Between $1 million and $25 million annual revenue CRE Lending Real estate loans for owner occupied and non-owner occupied commercial property; includes construction and land development (“C&D”) loans High quality credits Low LTV ratios (policy limit of 75%) Income-producing pro
Slide 14: Business Line Profile: CRE Lending | C&D Lending
~7.8% fixed rate Business Line Profile: CRE Lending | C&D Lending CRE Loans CRE and C&D Portfolio Growth C&D Loans C&D 2012 – Q3 2018 CAGR = 12.4% CRE 2012 – Q3 2018 CAGR = 21.6% (Dollars in millions) As of September 30, 2018: $524.2 million $110.7 million
Slide 15: Business Line Profile: C&I Lending | SBA Lending
Business Line Profile: C&I Lending | SBA Lending Credit Lines include commercial and industrial lines of credit, term loans, mortgage warehouse lines and international trade discounts C&I Loans SBA Loans As of September 30, 2018: $299.8 million $87.4 million C&I and SBA Portfolio Growth (Dollars in
Slide 16: Business Line Profile: 1-4 Single Family Residential Lending
As of September 30, 2018: No nonperforming loans¹ in the SFR portfolio Average: LTV of 56.1%; FICO score of 752; duration of approximately 4.5 years Current start rate of 4.75%; reprices after 7 years to one-year LIBOR plus 3.00% Business Line Profile: 1-4 Single Family Residential Lending SFR Loans
Slide 17: CRE Concentration Below Interagency Guidance
CRE Concentration¹ Below Interagency Guidance CRE for the purpose of the CRE concentration ratio measured as total commercial real estate loans less owner-occupied commercial real estate loans plus construction and land development loans; CRE concentration measures this value as a percentage of tota
Slide 18: Disciplined Credit Culture
Disciplined Credit Culture Nonperforming loans include nonaccrual loans, loans past due 90 days or more and still accruing interest and loans modified under troubled debt restructurings; nonperforming loans exclude PCI loans acquired in prior acquisitions Nonperforming assets include nonperforming l
Slide 19: Deposit Portfolio as of September 30, 2018
Avg. Balance Weighted ($mm) Avg. Rate Noninterest-Bearing Demand $276.8 0.00% NOW $23.0 0.26% Savings $29.7 0.40% Money Market $367.9 1.19% Retail Time¹ $228.9 1.61% Jumbo Time² $471.4 1.76% Total Deposits $1,397.7 1.17% Deposit Portfolio as of September 30, 2018 Strongest growth coming in DDAs Top
Slide 20: Attractive Net Interest Spread
Attractive Net Interest Spread Note: Q3 2018 profitability metrics reflect annualized values for the quarter Yield on Average Interest-Earning Assets Cost of Average Interest-Bearing Liabilities Net Interest Spread Net Interest Margin (FTE)
Slide 21: Outstanding Financial Performance
Outstanding Financial Performance Note: Q3 2018 profitability metrics reflect annualized values for the quarter. Non-GAAP reconciliation in Appendix on page 28 Return on Average Assets Return on Average Tangible Common Equity1 Efficiency Ratio (FTE) Noninterest Income / Average Assets
Slide 22: Capitalization as of September 30, 2018
(Dollars in millions, except per share amounts) As of September 30, 2018 Actual Long-Term Debt Long-Term Debt1 $49.6 Subordinated Debentures2 3.5 Total Long-Term Debt $53.1 Shareholders' Equity Common Stock $216.7 Additional Paid-in Capital 6.2 Retained Earnings 73.6 Accumulated Other Comprehensive
Slide 23: Asset Sensitive Balance Sheet
Asset Sensitive Balance Sheet Note: Assumes parallel shifts in market interest rates; Note: Financial data is not presented pro forma reflecting the acquisition of FAIT completed on October 15, 2018 12-Month Net Interest Income Sensitivity Immediate Change in Rates September 30, 2018 Economic Value
Slide 24: Loan pipeline expected to support double-digit loan growth
Loan pipeline expected to support double-digit loan growth Residential mortgage loan production positively impacted by expansion of lending activity in Las Vegas, Northern California and San Diego Hired a new SBA manager who will lead business development efforts SBA loan production has returned to
Slide 25: FAIB/RBB
FAIB/RBB @ Bs, LEGTER 4
Slide 26: Acquisition rationale: expands RBB franchise to New York
Expands the RBB franchise to the New York market Grants RBB access to the largest Asian-American population in the US with 2.3 million Asian-Americans in the New York City MSA Creates $3.0 billion institution with improved scale and efficiencies Enhances residential mortgage loan production platform
Slide 27: Franchise Highlights
Franchise Highlights Assets ~$3.0 Billion Loans HFS Loans ~$2.1 Billion ~$382 Million Deposits ~$2.2 Billion Equity ~$365 Million Branches (2) 22 Pro Forma Financial Highlights(1) New York City Branch Locations California Branch Locations Estimated pro forma balance sheet reconciled on slide 26 and
Slide 28: Pro Forma Loan Composition as of September 30, 2018
Pro Forma Loan Composition as of September 30, 2018 Pro forma for the acquisition of FAIT completed on October 15, 2018; RBB’s 1-4 Family residential loans exceed 50% of the portfolio. RBB stated in its 2018 Q3 Earnings Call their intention to sell a greater volume in the fourth quarter which will r
Slide 29: Pro Forma Deposit Composition as of September 30, 2018
Pro Forma Deposit Composition as of September 30, 2018 Jumbo deposits defined as time deposits with balances greater than $100,000 Note: Bank level regulatory deposit composition as of September 30, 2018; Does not include purchase accounting adjustments Source: S&P Global Market Intelligence
Slide 30: Estimated Pro Forma Balance Sheet
Estimated Pro Forma Balance Sheet Excludes Proposed Sub Debt Offering Note: Estimated pro forma adjustments are explained on slide 27; Form 8-K/A with further pro forma detail and explanation expected to be filed by RBB on or about December 15, 2018 Source: S&P Global Market Intelligence, Company in
Slide 31: Pro Forma Consolidated & Bank Level Capital Ratios
Pro Forma Consolidated & Bank Level Capital Ratios Assumes $55.0 million gross offering of subordinated debt, $53.4 million net of 1.5% placement agent fee and expenses; Assumes 80% of net offering proceeds downstreamed to the bank as equity and 20% risk-weighting on new Assets; All offering assumpt
Slide 32: Appendix
Appendix
Slide 33: Board of Directors
Board of Directors Yee Phong (Alan) Thian Chairman of the Board Chairman, President and CEO of the Company and the Bank since the Bank began operations in 2008 Peter M. Chang President of Yao Yang Enterprises LLC, which purchases and exports waste paper Wendell Chen CEO of US Development LLC, a real
Slide 34: Board of Directors (continued)
Board of Directors Paul Lin Founder and CEO of Drill Spot, LLC Named one of Inc. Magazine’s Top 10 Asian Entrepreneurs in 2010 Fui Ming Thian Worked in the real estate management business for over 30 years Responsible for operating and accounting for multiple apartment complexes Raymond Yu Former Ch
Slide 35: Non-GAAP Reconciliation: Tangible Common Equity and Tangible Assets
Some of the financial measures included in this presentation are not measures of financial performance recognized by GAAP. These non-GAAP financial measures include “tangible common equity to tangible assets,” “tangible book value per share,” and “return on average tangible common equity.” Our manag
Slide 36: Core deposits reconciliation
Some of the financial measures included in this presentation and in forms 10-Q & 10-K filed with the SEC differ from those reported on the FRB Y-9(c) report. These financial measures include “core deposits to total deposits.” Our management uses this financial measure in its analysis of our performa
Slide 37: How We Measure Core Deposits
How We Measure Core Deposits Demand Deposits Savings Deposits Time Deposits < $250,000 Relationship with RBB Director or shareholder? Deposits within the Bank’s market area? Additional non-deposit services with the Bank? Electronic banking services with the Bank? Active demand deposit account with t
Slide 38: Double Leverage and Interest Coverage - $55 Million Offering
Double Leverage and Interest Coverage - $55 Million Offering Note: All offering assumptions are for illustrative purposes; includes completed acquisition of FAIT completed on October 15, 2018 Assumes a 6.180% annual coupon rate on new subordinated debt Source: S&P Global Market Intelligence, Company