Smartfinancial, Inc. · NYSE:SMBK
Smartfinancial — Merger or Acquisition (April 2021)
19 slides from Smartfinancial's merger presentation, Apr 14, 2021
Slide 1: Acquisition of Sevier County Bank
Acquisition of: SCB SEVIER COUNTY BANK April 14, 2021, 10:00am ET Webcast: www.smartbank.com (Investor Relations) Audio Only: 888-317-6003 Confirmation #: 3063532 Miller Welborn Chairman of the Board Billy Carroll President & CEO 1
Slide 2: Legal Disclaimer
Legal Disclaimer Forward-Looking Statements Non-GAAP Financial Measures Certain statements in this communication may constitute “forward-looking statements” within the meaning of the Statements included in this presentation include Non-GAAP financial Private Securities Litigation Reform Act of 1995,
Slide 3: Compliance Disclosure
Compliance Disclosure Additional Information and Where to Find It Participants in the Solicitation This presentation does not constitute an offer to sell or the solicitation of an offer to buy any The Company, SVRH and certain of their directors, executive officers and employees securities or a soli
Slide 4: In-Market Acquisition Bolsters Density
In-Market Acquisition Bolsters Density ▲ Logical, in-market consolidation solidifying Sevier County market share (moving into the #1 market share)1 and eliminating the entry of a potential competitor ▲ Market overlap creates ability to consolidate branches and drive substantial cost synergies ▲ SMBK
Slide 5: Key Transaction Terms
Key Transaction Terms ▲ SVRH to merge into SMBK, followed by the merger of Sevier County Bank into SmartBank Structure ▲ 100% stock consideration; cash election for shareholders with <20,000 shares (~10% of shares)1 ▲ Tax-free reorganization at the corporate level Exchange ▲ Fixed exchange ratio Rat
Slide 6: Sevier County: A Multi-Generational Legacy
Sevier County: A Multi-Generational Legacy Company Overview TN / VA Branch Footprint ▲ Founded in 1909, Sevier County Bank is a historic community bank with a legacy of long-term client relationships ▲ 2019 recapitalization accompanied by complimentary management additions and organizational improve
Slide 7: Core Market Enhancement
Core Market Enhancement Transaction creates #1 market share in Sevier County, enhances Tennessee presence, and provides attractive franchise consolidation opportunity Complimentary Branch Footprint… …Creates #1 Share in Sevier County & Bolsters TN 2020 2020 Rank Market Market Deposits Share Deposits
Slide 8: New Richmond Opportunity
New Richmond Opportunity New six-person commercial banking team in Richmond, VA with 100+ combined years of in-market experience Attractive North Richmond Location Comparison: SMBK Top Four Markets1 2021 2021-2026 2021 2021-2026 Total Proj. Pop. Median Proj. HH Pop. Change HH Income Income (Actual)
Slide 9: Transaction Assumption Highlights
Transaction Assumption Highlights ▲ Identified fully phased-in cost savings of ~$7.1mm One-Time Expense Breakdown Misc. / Other • ~63% of SVRH’s estimated 2021 noninterest expense 4% Prof essional Branch Closing / Fees • Phased-in at 25% in 2021, 100% thereafter Lease Termination 14% Synergies and 1
Slide 10: Attractive Pro Forma Impact
Attractive Pro Forma Impact Manageable Dilution to ~2.4 Years Tangible Book Tangible Book Value Per Share earn back with ~3.3% dilution expected at close1 Value Below SMBK internal 3-year earn back threshold Delivering EPS 15%+ Growth Accretion to 2022 Earnings Per Share2 Robust Pro Forma Earnings >
Slide 11: Due Diligence Process
Due Diligence Process Comprehensive due diligence coordinated and led by executives of both SMBK and SVRH Engagement of external counsel, consultants and internal M&A team SMBK has extensive prior diligence and integration experience – six acquisitions in the past nine years Diligence Focus Ar
Slide 12: Cost Synergies Breakdown
Cost Synergies Breakdown Deep dive into potential cost synergies with thorough examination of leases and contracts SMBK senior operational heads involved in synergies review Collaborative process with valuable input from SVRH senior management Commentary Cost Savings Breakdown1 ▲ Analysis of e
Slide 13: SMBK M&A Criteria
SMBK M&A Criteria SmartFinancial is committed to balancing organic growth with thoughtful acquisitions and will not make acquisitions simply for the sake of growth Impact SMBK Criteria Acquisition of SVRH TBV Earn Back Period < 3 Years 1 1 Meaningful earnings EPS Impact accretion in first full yea
Slide 14: A History of Methodical Growth
A History of Methodical Growth 10-Year CAGR1: 27% 5-Year CAGR2: 34% Sevier County Bancshares Acquisition: Assets: $424mm Progressive 3 Financial Group 3,728,980 Assets: $295mm Functional Subordinated Initial Public Debt Offering $3,304,949 Offering Value: $40mm Value: $39mm Acquisition: Acquisition:
Slide 15: Appendix
ly, SmartFinancial Appendix
Slide 16: Pro Forma Company Snapshot
Pro Forma Company Snapshot Pro Forma Franchise Highlights December 31, 2020 - Deposit / Loan Mix Pro Forma1 SMBK SVRH Pro Forma Cons./ Cons./ Assets $4.0bn Other Other 0% 1% Loans / Dep. 79% Cons./ Other 11% C&I/Ag C&I/Ag C&I/Ag 25% 27% 9% CRE CRE 42% C&D 44% $2.4bn 5% $246mm $2.6bn TCE/TA 8.1% CRE
Slide 17: Non-GAAP Reconciliations
Non-GAAP Reconciliations Financial Information at and for the Twelve Months Ended December 31, 2020 ($ in thousands except per share data) SMBK Tangible Common Equity ("TCE") SVRH Tangible Common Equity ("TCE") Shareholders' Equity (GAAP) $ 357,168 Shareholders' Equity (GAAP) $ 29,801 Less: Goodwill
Slide 18: Investor Contact
Investor Contact Billy Carroll Miller Welborn President & CEO Chairman 865.868.0613 423.385.3067 [email protected] [email protected] 5401 Kingston Pike, Suite 600 Knoxville, TN 37919 18
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