INDEPENDENT BANK CORP - FORM 8-K - EX-99.1 - PIPER JAFFRAY INVESTOR PRESENTATION - May 16, 2017

Attached files

file filename
8-K - PIPER JAFFRAY MAY 2017 FINANCIAL INSTITUTIONS CONFERENCE - INDEPENDENT BANK CORPpiperjaffraymay20178-k.htm
Piper Jaffray Financial Institutions Conference May 16, 2017 Robert Cozzone – Chief Financial Officer and Treasurer Exhibit 99.1

 
(2) Who We Are • Main Sub: Rockland Trust • Market: Eastern Massachusetts • Loans: $6.1 B • Deposits: $6.5 B • $AUA: $3.0 B • Market Cap: $1.7 B • NASDAQ: INDB

 
(3) Key Messages • Lengthy track record of consistent, solid performance • Robust loan and core deposit activity • Growing fee revenue sources, esp. Investment Mgmt. • Expanding footprint in growth markets • Tangible book value steadily growing * • Steadily improving operating efficiency • Disciplined risk management culture • Proven integrator of acquired banks • Deep, experienced management team * See appendix A for reconciliation

 
(4) Expanding Company Footprint Rank 2016 1 23.5% 39% Rank 2016 5 4.9% 18% Rank 2016 3 12.3% 14% Rank 2016 6 7.9% 12% Rank 2016 19 1.2% 10% Rank 2016 17 0.3% 4% Rank 2016 2 19.7% 2% Rank 2016 31 0.3% 1% Suffolk County Bristol County Worcester County Dukes County (MV) Middlesex County Norfolk County % of INDB Dep.Share Barnstable County (Cape Cod) Market Plymouth County Source: SNL Financial; Deposit/Market Share data as of October 20, 2016. *Pro forma for Island Bancorp, Inc. acquisition *

 
(5) Recent Accomplishments • Four consecutive years of record earnings • Finalized acquisition of Island Bancorp, Inc. of Martha’s Vineyard • Finalized acquisition of New England Bancorp, Inc. of Cape Cod • Capitalizing on expansion moves in vibrant Greater Boston market • Growth initiatives – new commercial products, new and revitalized branches, expanded digital offerings, lending staff adds • Strong household growth rate • Consistently high rankings in third party surveys

 
(6) $59.9 $71.7 $80.4 $21.1 2014 2015 2016 1Q17 Operating Earnings ($ Mil.)** Strong Fundamentals Driving Performance +16% CAGR Diluted EPS $2.49 $2.50 $2.90 $0.76 • Robust customer activity • Core deposits up to 90% • Fee revenues rising • Low funding costs • Low credit loss rates • TBV steadily growing* • Solid returns • Accretive Acquisitions Diluted EPS $2.50 $2.76 $3.04 $0.78 * See appendix A for reconciliation * *See appendix B for reconciliation $59.8 $65.0 $76.6 $20.7 2014 2015 2016 1Q17 Net Income ($ Mil.) +13% CAGR

 
(7) Vibrant Commercial Lending Franchise TOTAL LOANS $6.1 B AVG. YIELD: 3.99% 1Q 2017 Comm'l 72% Resi Mtg 11% Home Eq 17% • Long-term CRE/ C&I lender • Increased small business focus • Strong name recognition in local markets • Expanded market presence • Experienced, knowledgeable lenders • Growing in sophistication and capacity • Commercial banker development program • Disciplined underwriting

 
(8) Commercial Real Estate Diversification *Includes 1-4 Family, Multifamily, Condos and Approved Land Residential-Related* 30.6% Commercial Buildings 18.9% Office Buildings 11.4% Industrial / Warehouse 8.6% Hotels / Motels 8.6% Strip Malls 3.9% All Other 18.0% Total Commercial Real Estate Portfolio by Property Type Balance $3.4B as of 3/31/17

 
(9) C&I Diversification Real Estate and Rental and Leasing 16.6% Retail Trade 21.3%Construction 10.1% Wholesale Trade 12.4% Manufacturing 9.6% Finance and Insurance 7.9% Health Care and Social Assistance 5.3% All Other (12 Sectors) 16.8% C&I Loan Portfolio Composition Balance $881.3M as of 3/31/17

 
(10) Low Cost Deposit Base Demand Deposits 32% Money Market 20% Savings/Now 38% CDs 10% TOTAL DEPOSITS $6.5 B AVG. COST: 0.18% 1Q 2017 • Sizable demand deposit component • Valuable source of liquidity • Relationship-based approach • Excellent household growth • Expanded digital access • Growing commercial base • Reducing higher cost deposits CORE DEPOSITS: 90%

 
(11) 816 1,651 2,919 3,040 2006 2011 2016 1Q17 AUAs ($ Mil.) Investment Management : Transformed Into High Growth Business +273% +257% • Successful business model • Growing source of fee revenues • Strong feeder business from Bank • Expanding investment center locations • Cross-sell opportunity in acquired bank markets • Adding experienced professionals

 
(12) Well-Positioned for Rising Rates: Prudent Balance Sheet Management -15% -10% -5% 0% 5% 10% 15% 20% 25% Year 0 Year 1 Year 2 % In cr ease o n N et In te re st In co m e Interest Rate Sensitivity Down 100 Up 200 Up 400 Flat Up 200

 
(13) Asset Quality: Well Managed $27.5 $27.7 $57.4 $55.1 2014 2015 2016 1Q17 NPLs ($ Mil.) NPL/Loan % 0.55% 0.50% 0.96% 0.91% Peers 0.64%* * Source: FFIEC Peer Group 2; $3-10 Billion in Assets, December 31, 2016 Incl. 90 days + overdue $8.5 $0.8 $0.3 ($0.2) 2014 2015 2016 1Q17 Net Chargeoffs ($ Mil.) customer fraud Loss Rate 18bp 1bp 1bp -1bp Peers 12bp*

 
(14) Strong Capital Position (period end) $19.18 $21.29 $23.45 $23.92 2014 2015 2016 1Q17 Tangible Book Value* +25% * See appendix A for reconciliation $26.69 $29.40 $32.02 $32.44 2014 2015 2016 1Q17 Book Value Per Share +22% • Strong internal capital generation • No storehousing of excess capital • No external equity raising • No dividend cuts

 
(15) Attentive to Shareholder Returns $0.96 $1.04 $1.16 $0.32 2014 2015 2016 1Q17 Cash Dividends Declared Per Share

 
(16) Sustaining Business Momentum Business Line • Expand Market Presence/Recruit Seasoned Lenders • Grow Client Base • Expand Specialty Products, e.g. ABL, Leasing • Lender Development Programs Commercial • Continue to Drive Household Growth • Expand Digital Offerings • Optimize Branch Network Retail Delivery • Capitalize on Strong Market Demographics • Continue Strong Branch/Commercial Referrals • Expand COI Relationships Investment Management • Continue Aggressive H.E. Marketing • Scalable Resi Mortgage Origination Platform Consumer Lending Focal Points

 
(17) Expanded Presence in Vibrant Greater Boston Long-Term Commercial Lender in Greater Boston Central Bancorp $357MM Deposits 10 Branches – Nov. 2012 Investment Management and Commercial Lending Center October 2013 Peoples Federal Bancshares $432MM Deposits 8 Branches – Feb. 2015

 
(18) Island Bancorp Acquisition Edgartown National Bank • Profitable, well-managed community bank • Provides first retail presence on M.V. • Excellent complement to growing Cape Cod presence • Financially attractive • $0.03 - $0.04 EPS accretion expected in 2018 • Neutral to TBV • Modest, low-risk deal • Asset size: ~$200 MM • Transaction value: $29 MM • Closed in May ‘17 INDB: A Proven Integrator

 
(19) Building Franchise Value Disciplined Acquisitions Deal Value: $84.5MM 2% Core Dep. Premium* Benjamin Franklin Bancorp Apr ‘09 $994mm Assets $701mm Deposits 11 Branches Deal Value: $52.0MM 8% Core Dep. Premium* Central Bancorp Nov ‘12 $537mm Assets $357mm Deposits 10 Branches Deal Value: $40.3MM 8% Core Dep. Premium* Mayflower Bancorp Nov’13 $243mm Assets $219mm Deposits 8 Branches $276 mm Assets $176mm Deposits Net 1 Branch Deal Value: $41.7MM 12% Core Dep. Premium* All Acquisitions Immediately Accretive *Incl. CDs <$100k Deal metrics based on closing price and actual acquired assets New England Bancorp Nov ‘16 Deal Value: $102.2 MM 17% Core Dep. Premium* Slade’s Ferry Bancorp Mar ‘08 $630mm Assets $411mm Deposits 9 Branches Peoples Federal Bancshares Feb ’15 $640 mm Assets $432mm Deposits 8 Branches Deal Value: $141.8MM 10% Core Dep. Premium* Island Bancorp May ‘17 $194 mm Assets $171mm Deposits Net 4 Branches Deal Value: $29MM 9% Core Dep. Premium*

 
(20) Major Opportunities in Acquired Bank Markets: Capitalizing on Rockland Trust Brand Investment Management Commercial Banking Retail/ Consumer • $3.0 billion AUA • Wealth/Institutional • Strong referral network • Sophisticated products • Expanded capacity • In depth market knowledge • Award winning customer service • Electronic/mobile banking • Competitive home equity products Acquired Bank Customer Bases

 
(21) Optimizing Retail Delivery Network In the past twelve months we have: • Utilized specialized analytics software/location model • Shifted branch distribution • Closed/consolidated 1 • Opened 1 • Redesigned 4 • Transitioned to instant-issue debit cards • Introduced SecurLOCK feature , allowing customers to manage the security of their debit card(turn off/on, alerts, etc.) • Implemented Apple, Android and Samsung Pay • Allowed for electronic scans of customer identification • Enabled EMV compatible ATMs • Converted all debit cards to EMV ready

 
(22) INDB Investment Merits • High quality franchise in attractive markets • Strong organic business volumes • Growing brand recognition • Operating platform that can be leveraged further • Capitalizing on in-market consolidation opportunities • Diligent stewards of shareholder capital • Grounded management team • Positioned to grow, build, and acquire to drive long-term value creation

 
(23) Appendix A

 
(24) Appendix B

 
(25) NASDAQ Ticker: INDB www.rocklandtrust.com Robert Cozzone – CFO & Treasurer Shareholder Relations: (781) 982-6737 Statements contained in this presentation that are not historical facts are “forward-looking statements” that are subject to risks and uncertainties which could cause actual results to differ materially from those currently anticipated due to a number of factors, which include, but are not limited to, factors discussed in documents filed by the Company with the Securities and Exchange Commission from time to time.

 

INDEPENDENT BANK CORP Reports