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Tower Bancorp, Inc.
Investor Presentation
Third Quarter 2010
Exhibit 99.1 |
 1
ABOUT THIS PRESENTATION
This
presentation
contains
forward-looking
statements
that
are
intended
to
be
covered
by
the
safe
harbor
for
forward-
looking
statements
provided
by
the
Private
Securities
Litigation
Reform
Act
of
1995.
Forward-looking
statements
are
not
statements
of
historical
fact,
and
can
be
identified
by
the
use
of
forward-looking
terminology
such
as
“believe,”
“expect,”
“may,”
“will,”
“should,”
“project,”
“plan,”
“seek,”
“target,”
“intend”
or
“anticipate”
or
the
negative
thereof
or
comparable
terminology.
Forward-looking
statements
include
discussions
of
strategy,
financial
projections
and
estimates
and
their
underlying
assumptions,
statements
regarding
plans,
objectives,
expectations
or
consequences
of
various
transactions,
and
statements
about
the
future
performance,
operations,
products
and
services
of
Tower
and
our
subsidiaries.
These
forward-looking
statements
are
subject
to
various
assumptions,
risks,
uncertainties
and
other
factors
including,
but
not
limited
to:
a
continuation
or
worsening
of
the
current
disruption
in
credit
and
other
markets;
the
ineffectiveness
of
Tower’s
business
strategy
due
to
changes
in
current
or
future
market
conditions;
the
effects
of
competition,
and
of
changes
in
laws
and
regulations
on
competition,
including
industry
consolidation
and
development
of
competing
financial
products
and
services;
interest
rate
movements;
the
performance
of
Tower’s
investment
portfolio;
changes
in
rates
of
deposit
and
loan
growth;
asset
quality
and
the
impact
on
assets
from
adverse
changes
in
the
economy
and
in
credit
or
other
markets
and
resulting
effects
on
credit
risk
and
asset
values;
inability
to
achieve
merger-related
synergies;
difficulties
in
integrating
distinct
business
operations,
including
information
technology;
capital
and
liquidity
strategies;
and
deteriorating
economic
conditions.
The
foregoing
review
of
important
factors
should
be
read
in
conjunction
with
the
risk
factors
and
other
cautionary
statements
included
in
documents
filed
by
Tower
Bancorp,
Inc.
with
the
Securities
and
Exchange
Commission,
including
Tower’s
Quarterly
Report
on
Form
10-
Q,
Annual
Report
on
Form
10-K
and
other
required
filings.
Because
of
these
uncertainties,
risks
and
the
possibility
of
changes
in
these
assumptions,
actual
results
could
differ
materially
from
those
expressed
in
any
forward-looking
statements.
Investors
are
cautioned
not
to
place
undue
reliance
on
these
statements.
Tower
Bancorp,
Inc.
assumes
no
duty
or
obligation
to
update
any
forward-looking
statements
made
in
this
presentation. |
 2
INFORMATION ABOUT THE FIRST CHESTER COUNTY CORPORATION TRANSACTION
The
proposed
merger
of
First
Chester
County
Corporation
(“First
Chester”)
and
Tower
Bancorp,
Inc.
(“Tower”)
will
be
submitted
to
the
shareholders
of
First
Chester
and
Tower
for
their
consideration
and
approval.
In
connection
with
the
proposed
transaction,
Tower
has
filed
with
the
Securities
and
Exchange
Commission
(the
“SEC”)
a
registration
statement
on
Form
S-4,
which
has
been
declared
effective
by
the
SEC
and
includes
a
joint
proxy
statement/prospectus
and
other
relevant
documents
to
be
distributed
to
the
shareholders
of
Tower
and
First
Chester
on
or
about
November
5,
2010.
Investors
are
urged
to
read
the
registration
statement
and
the
joint
proxy
statement/prospectus
regarding
the
proposed
transaction
and
any
other
relevant
documents
filed
with
the
SEC,
as
well
as
any
amendments
or
supplements
to
those
documents,
because
they
will
contain
important
information.
Investors
can
obtain
a
free
copy
of
the
joint
proxy
statement/prospectus,
as
well
as
other
filings
containing
information
about
Tower
and
First
Chester,
free
of
charge
from
the
SEC’s
Internet
site
(www.sec.gov),
by
contacting
Tower
Bancorp,
Inc.,
112
Market
Street,
Harrisburg,
Pennsylvania
17101,
Attention:
Brent
Smith,
Investor
Relations,
telephone
717-724-4666
or
by
contacting
First
Chester
Financial
Corporation,
9
North
High
Street,
West
Chester,
Pennsylvania
19381
Attention:
John
Stoddart,
Investor
Relations,
telephone
484-881-4141.
INVESTORS
SHOULD
READ
THE
JOINT
PROXY
STATEMENT/PROSPECTUS
AND
OTHER
DOCUMENTS
TO
BE
FILED
WITH
THE
SEC
CAREFULLY
BEFORE
MAKING
A
DECISION
CONCERNING
THE
TRANSACTION.
Participants in the Transaction
Tower,
First
Chester
and
their
respective
directors,
executive
officers,
and
certain
other
members
of
management
and
employees
may
be
soliciting
proxies
from
Tower
and
First
Chester
shareholders
in
favor
of
the
transaction.
Information
regarding
the
persons
who
may,
under
the
rules
of
the
SEC,
be
considered
participants
in
the
solicitation
of
the
Tower
and
First
Chester
shareholders
in
connection
with
the
proposed
transaction
is
set
forth
in
the
joint
proxy
statement/prospectus
filed
with
the
SEC.
You
can
also
find
information
about
Tower’s
executive
officers
and
directors
in
its
definitive
proxy
statement
filed
with
the
SEC
on
April
23,
2010,
which
is
available
at
the
SEC’s
Internet
site
(www.sec.gov).
Additional
information
about
First
Chester’s
executive
officers
and
directors
is
set
forth
in
its
Form
10-K
filed
with
the
SEC
on
July
27,
2010,
which
is
available
at
the
SEC’s
Internet
site.
You
can
also
obtain
free
copies
of
these
documents
from
Tower
or
First
Chester,
as
appropriate,
using
the
contact
information
above.
This
document
is
not
an
offer
to
sell
shares
of
Tower’s
securities
which
may
be
issued
in
the
proposed
transaction.
Such
securities
are
offered
only
by
means
of
the
joint
proxy
statement/prospectus
referred
to
above. |
 3
COMPANY PROFILE
A Pennsylvania-chartered bank holding company
organized in 1983, with roots dating back to 1864
High-growth community bank headquartered in Harrisburg, Pennsylvania
Completed
a
merger
of
equals
transaction
on
March
31,
2009,
with
Graystone
Financial Corp. to create a $1.2 billion asset company
Pending
merger
with
First
Chester
County
Corporation
will
create
a
$2.7
billion
asset
company
Post-merger, will operate approximately 49 retail offices in eleven counties of
central and south-eastern Pennsylvania and Maryland
Strong corporate culture with clear strategic vision
Shares traded on NASDAQ Global Market under the symbol “TOBC”
|
 4
COMPANY PROFILE
•
As of September 30, 2010:
–
Total Assets:
$ 1.6 billion
–
Gross Loans:
$ 1.3 billion
–
Deposits:
$ 1.4 billion
–
Shareholders’
Equity:
$ 165.7 million
–
Book Value Per Share:
$ 23.08
–
Tangible Book Value Per Share:
$ 21.02
–
Total Regulatory Capital Ratio:
13.18%
–
Market Capitalization:
$ 159.6 million
(as of October 25, 2010 as reported by SNL Financial)
|
 5
PRO FORMA COMPANY PROFILE
•
Pro Forma For Pending Acquisition of First Chester County Corporation (as of June
30, 2010) (1) –
Total Assets:
$ 2.7 billion
–
Gross Loans:
$ 2.0 billion
–
Deposits:
$ 2.3 billion
–
Shareholders’
Equity:
$ 207.2 million
–
Book Value Per Share:
$ 22.90
(1) Pro Forma combined data is derived from Tower Bancorp, Inc. Registration
Statement on Form S-4, as filed with the SEC on September 3, 2010 as
amended on October 5, 2010 and November 1, 2010, and is subject to the assumptions, estimates and other qualifications set forth
therein
under
the
sections
titled
“Selected
Unaudited
Pro
Forma
Combined
Financial
Data
for
Tower”
and
“Unaudited
Pro
Forma
Combined
Financial Information.” |
 6
MISSION, VISION AND VALUES
Mission Statement
Tower Bancorp, Inc. will positively impact lives by helping people achieve their
dreams. Vision Statement
Tower Bancorp, Inc. will be a high performing financial services
company that creates financial
success for consumer, business, and not for profit customers in the markets we
choose to serve.
Value Statement
Tower Bancorp, Inc. is committed to attracting and retaining employees who are
passionate about providing uncompromising service to our customers with a
sense of warmth, integrity, friendliness, and company spirit. We value
and respect each other because we truly believe that our success only comes
from working together for our team’s success. Making a Positive
Impact |
 7
INTERNAL ENVIRONMENT
•
Strong organic growth complemented with strategic acquisitions
•
“Well Capitalized”
•
Strong balance sheet
•
Deep leadership team with over 150 years of combined in-market experience
•
Improved liquidity and visibility of stock
•
Continued strong asset quality ratios
•
Improved net interest margin
A Culture Where Our Leaders Are Our
Sustainable Competitive Advantage |
 8
CORPORATE LEADERSHIP TEAM
ANDREW SAMUEL
JEFF RENNINGER
JANAK AMIN
MARK MERRILL
Chairman and Chief
Executive Officer
25 years banking
experience (25 years in-
market)
Prior experience: Fulton
Bank and Waypoint Bank
Chief Operating Officer
32 years banking
experience (23 years in-
market)
Prior experience: PNC
Bank, Meridian Bank and
Waypoint Bank
President,
Graystone Bank
21 years banking
experience (19 years in-
market)
Prior experience: Fulton
Bank and Waypoint Bank
Chief Financial Officer
12 years financial
experience
Prior experience:
Pricewaterhouse-Coopers
and Waypoint Bank
CARL LUNDBLAD
JANE TOMPKINS
JOE BERTOTTO
MIKE BAYLOR
General Counsel
13 years M&A, bank
regulatory, securities and
corporate experience (13
years in-market)
Prior experience: Rhoads
& Sinon
Chief Credit Officer
34 years experience in the
financial services industry
with over 18 years in credit
policy formation
Prior experience: PNC
Bank and Waypoint Bank
Chief Culture Officer
29 years banking
experience
Prior experience: PNC
Bank and Waypoint Bank
Regional President,
Maryland Division
26 years in-market
banking experience
Prior experience:
Keystone Financial,
Waypoint Bank and PNC
Bank
Deep and proven management team with average experience of 24 years
|
 9
GRAYSTONE TOWER BANK ACCOMPLISHMENTS |
 10
Potentially attractive growth and expansion opportunities
FOOTPRINT AND CURRENT GROWTH POTENTIAL
Note: Tower believes that a growth opportunity exists for the counties
appropriately marked above based on Tower’s close proximity to those counties,
management’s familiarity with the demographics and businesses and business
leaders in those counties and Tower’s reputation in those counties.
Chester County Franchise
(Pro forma)
Current Graystone
Tower Franchise
Growth Markets |
 11
PERFORMANCE OBJECTIVES
Tower Bancorp Inc. will strive to be in the top 20% of our Peer
Group as defined by the Board of Directors in the following:
|
 12
BUSINESS STRATEGIES |
   13
CONFIRMED GROWTH MODEL
Tower Bancorp Inc. Pro
Forma $2.7 Billion Assets
49 Branches
“Creating Central/Southeastern
Pennsylvania’s Premier Community Bank” |
 14
ASSET GROWTH ($000) (1) (2)
(1) All financial information for periods prior to March 31, 2009 represents
historical financials for Graystone Financial Corp., as the accounting
acquirer in the reverse merger with Tower Bancorp Inc.
(2) 2005 financial data reflects the period from September 2, 2005 (inception date)
to December 31, 2005 |
 15
DEPOSIT GROWTH ($000) (1) (2)
(1) All financial information for periods prior to March 31, 2009 represents
historical financials for Graystone Financial Corp., as the accounting
acquirer in the reverse merger with Tower Bancorp Inc.
(2) 2005 financial data reflects the period from September 2, 2005 (inception date)
to December 31, 2005 |
 16
LOAN GROWTH ($000) (1) (2) (3)
(1) All financial information for periods prior to March 31, 2009 represents
historical financials for Graystone Financial Corp., as the accounting
acquirer in the reverse merger with Tower Bancorp Inc.
(2) 2005 financial data reflects the period from September 2, 2005 (inception date)
to December 31, 2005 (3) Loans are presented as net of unearned income
|
 17
QUALITY ASSET GROWTH STRATEGY |
 18
NON-INTEREST INCOME ($000) (1)
(2) (1) All financial information for periods prior to March 31, 2009
represents historical financials for Graystone Financial Corp., as the accounting
acquirer in the reverse merger with Tower Bancorp Inc.
(2) 2005 financial data reflects the period from September 2, 2005 (inception date)
to December 31, 2005 (3) For nine months ended September 30, 2010
|
 19
EFFICIENCY RATIO (1) (2)
(1)
All
financial
information
for
periods
prior
to
March
31,
2009
represents
historical
financials
for
Graystone
Financial
Corp.,
as
the
accounting
acquirer in the reverse merger
(2)
Efficiency
ratio
is
calculated
as
total
non-interest
expense
divided
by
the
total
of
net
interest
income
and
non-interest
income.
(3) For nine months ended September 30, 2010 |
 20
NET INTEREST MARGIN (1) (2)
(1) All financial information for periods prior to March 31, 2009 represents
historical financials for Graystone Financial Corp., as the accounting
acquirer in the reverse merger
(2) 2005 financial data reflects the period from September 2, 2005 (inception date)
to December 31, 2005 (3) Net Interest margin for the nine months-ended
September 30, 2010 |
 21
•
2005-2007 –
Graystone raised approximately $65 million of total capital in private
placements •
2008 –
Graystone grew to over $600 million in assets with Net Income $2.1 million in
third full year •
March 2009 -
Merger of equals of Graystone Financial Corp. and Tower Bancorp, Inc.
•
2009 -
NASDAQ Listing
•
2009-2010 –
Raised $21 million of subordinated debt with local investors
•
2009 -
Oversubscribed public offering with net proceeds of approximately $51.5
million •
December 2009 -
Announced acquisition of First Chester County Corporation
•
2009 –
2010 -
Increased visibility on Wall Street and growth in institutional
ownership
GRAYSTONE/TOWER STRATEGIC ACCOMPLISHMENTS |
 22
INVESTMENT MERITS
•
Deep and broad management team with extensive in-market experience
•
Compelling culture that drives excellence
•
Disciplined approach to strategy development and execution
•
Successful and proven growth strategy
•
Diversified
credit
portfolio
with
a
conservative
focus
on
credit
quality
•
Significant franchise value
•
Anticipated earnings per share accretion with First Chester County Corporation
acquisition |
 23
23
THANK YOU! |