NBT Bancorp Inc. · NASDAQ:NBTB
NBT Bancorp — Piper Jaffray Investor Conference 2018
27 slides from NBT Bancorp's conference presentation, May 15, 2018
Slide 1: NBT Bancorp Inc. Piper Jaffray Investor Conference
NBT Bancorp Inc. Piper Jaffray Investor Conference May 15, 2018 Presented by: John H. Watt, Jr., President and Chief Executive Officer
Slide 2: Overview
Overview About NBT Bancorp Financial Performance Strategic Initiatives Appendix 2
Slide 3: Company Profile
Company Profile NBT Bancorp Inc. is a financial holding company headquartered in Norwich, NY. • Founded in 1856 • Market: Nasdaq Global Select • Ticker Symbol: NBTB • Assets: $9.2 Billion • Market Capitalization: $1.6 billion • Institutional Ownership: 52% • Average Daily Volume: 120,000 The company
Slide 4: NBT Bank Footprint
NBT Bank Footprint NBT Bank, N.A. has 152 banking locations and 194 ATMs in New York, Pennsylvania, Vermont, Massachusetts, New Hampshire and Maine. NBT Insurance Agency, LLC based in Norwich, NY, is a full-service insurance agency. EPIC Advisors, Inc., based in Rochester, NY, is a full-service 401(
Slide 5: Overview
Overview About NBT Bancorp Financial Performance Strategic Initiatives Appendix 5
Slide 6: Financial Highlights
Financial Highlights Three Months Ended Twelve Months Ended Dollars in Millions March 31, December 31, Except Per Share Data 2018 2017 2017 * 2016 Net Income $ 26.0 $ 20.3 $ 86.6 $ 78.4 Earnings Per Share $ 0.59 $ 0.46 $ 1.97 $ 1.80 Return on Average Assets 1.15% 0.92% 0.96% 0.92% Return on Average
Slide 7: Investments Enabled by Tax Reform
Investments Enabled by Tax Reform Our Our Our Our People Customers Communities Shareholders Minimum hourly rate increased to $15 Additional Additional 8.7% capital charitable or $0.02 5% increase for resources contribution quarterly those with base for resources dividend pay ≤ $50,000 customer- allo
Slide 8: 5-Year Dividend Growth
5-Year Dividend Growth $1.02 $0.98* $0.92 $0.92 $0.90 $0.87 $0.84 $0.81 $0.82 8.7% 505th Quarterly dividend Consecutive dividend increase to payment $0.25 per share $0.72 2013 2014 2015 2016 2017 2018 *Annualized based on second quarter 2018 dividend declared of $0.25 ABOUT NBT BANCORP | FINANCIAL P
Slide 9: History of Superior Performance
History of Superior Performance 100 180 10-Year Total Return 3-Year Total Return Through March 31, 2018 150 Through March 31, 2018 80 125 120 54 103 Total Return % 60 Total Return % 54 90 52 67 40 60 30 20 0 0 (30) (20) (60) (40) (90) Years Years Total Return of Peer SNL $10,000 NBT Median U.S. Bank
Slide 10: Premium Valuation
Premium Valuation Price to Tangible Book Value as of March 31, 2018 300% 225% 229.8% 199.9% 193.9% 150% 75% 0% NBT Peer Median SNL U.S. Bank Peer Data Source: SNL Financial Market as of the most recent quarter. Peer Group information is included on page 25. ABOUT NBT BANCORP | FINANCIAL PERFORMANCE
Slide 11: Overview
Overview About NBT Bancorp Financial Performance Strategic Initiatives Appendix 11
Slide 12: Well-Positioned Balance Sheet
Well-Positioned Balance Sheet Investment and Loan Repricing Other Loan Mix Deposit Mix Consumer 1% Specialty Home Lending Equity 7% Time 7% Residential 11% > 5 Years 18% Real Estate Demand 20% (Noninterest Bearing) Dealer 32% Finance 3-5 Years 0-3 Years 19% 18% Commercial 64% 20% Savings, NOW, and M
Slide 13: Deposit Pricing Strength
Deposit Pricing Strength Change in Cost of Interest Bearing Deposits from Q4 2015 – Q4 2017 25-75 Change in Basis Points 15-24 5-14 0-4 Includes NBT at 0 bps <0 0 5 10 15 20 25 Number of Banks Of the 56 banks in the Mid-Atlantic region with assets of $1 to $10 billion, 86% have experienced a larger
Slide 14: Consistent Loan Growth
Consistent Loan Growth (Dollars in Millions) Year-Over-Year Growth as of March 31, 2018 6.0% $240 $223 $200 Year-Over-Year $160 Growth 5.1% $120 $80 $94 $57 5-Year $40 CAGR $0 Commercial Consumer Residential Real Estate Percent of Annual Growth 60% 25% 15% ABOUT NBT BANCORP | FINANCIAL PERFORMANCE |
Slide 15: Emphasis on Fee Based Businesses
Emphasis on Fee Based Businesses As of March 31, 2018 Total Noninterest Income – $31 million Noninterest income Retirement Plan to total revenues Administration Fees Other 32% was 30% compared 17% $5 million to peer median at 24% Wealth Management Insurance and Other Services Charges 53% Financial S
Slide 16: Retirement Plan Services Line of Business
Retirement Plan Services Line of Business (Dollars in Thousands) Helping America Retire National Reach • Clients in 50 States Over 220,000 plan participants $35,000 $25,000 Revenue $15,000 $5,000 2014 2015 2016 2017 2018* EPIC NBT TPA ADS DPS RPS * Annualized based upon March 31, 2018 results and th
Slide 17: Proven Acquirer and Integrator
Proven Acquirer and Integrator • Completed 7 whole-bank, 7 branch • Experienced no material run-off in and 7 non-bank business acquisitions loans and deposits with bank and since 2000 branch deals • Achieved or exceeded targeted • Continued to diversify revenue cost saves sources and expand capabili
Slide 18: New England Expansion
New England Expansion • 19 locations in 4 states – 15 banking locations – 3 retirement plan services – 1 specialty lending • 160 employees • 2017 growth – 15% growth in total outstanding loans – 39% of total loan growth – 5% growth in deposits – 20% increase in wealth assets under management NBT in
Slide 19: Multi-Faceted Digital Strategy
Multi-Faceted Digital Strategy Customer • Regularly enhancing mobile and online banking, including biometric authentication, mobile check images and text alerts Mobility • Experiencing strong adoption of self-service options, with over 60% of checking customers using mobile and online banking • Expa
Slide 20: Specialty Lending Line of Business
Specialty Lending Line of Business EXPERIENCE • Decade of niche experience in technology-driven consumer lending through partnerships with fintech companies delivering financing at the point of purchase PORTFOLIO • $472 million at March 31, 2018 • 7% of total loans PARTNERSHIPS • Launched partnershi
Slide 21: Overview
Overview About NBT Bancorp Financial Performance Strategic Initiatives Appendix 21
Slide 22: Reconciliation to 2017 Reported Results
Reconciliation to 2017 Reported Results The following table reconciles 2017 reported net income to adjusted net income and related performance ratios to exclude the one-time noncash charge associated with the Tax Cuts and Jobs Act. Reported Twelve Add back: Adjusted Twelve Dollars in Millions Months
Slide 23: Compliance Readiness Plans
Compliance Readiness Plans Estimated Annual Costs $10 Billion $9 to $11 million (including Durbin impact) • Dodd-Frank Act Stress Testing • Consumer Financial Protection Bureau Oversight • Durbin Impact Revenue Replacement Strategies • Enhancement of Corporate Governance and Risk Management Practice
Slide 24: Recruiting Key Talent
Recruiting Key Talent Recent Hires Position with NBT Prior Experience Sarah Halliday President of Commercial Banking M&T Bank Amy Wiles Chief Credit/Risk Officer KeyBank, JP Morgan Chase Dawn Gillette Manager of Specialty Lending KeyBank, Bank of America Bill Huba Deputy BSA and Sanctions Officer Of
Slide 25: Peer Group
Peer Group Name HQ City State Ticker Berkshire Hills Bancorp, Inc. Pittsfield MA BHLB Brookline Bancorp Inc. Boston MA BRKL Community Bank System, Inc. Dewitt NY CBU Flagstar Bancorp Inc. Troy MI FBC First Commonwealth Financial Corporation Indiana PA FCF Flushing Financial Corp. Lake Success NY FFI
Slide 26: Top Ten Institutional Investors
Top Ten Institutional Investors Institutional Investors % Ownership (as of December 31, 2017) BlackRock Institutional Trust Company, N.A. 12.04% The Vanguard Group, Inc. 9.57% Dimensional Fund Advisors, L.P. 4.73% Macquarie Investment Management 3.39% State Street Global Advisors (US) 2.99% Northern
Slide 27: Forward-Looking Statements
Forward-Looking Statements This presentation may contain forward-looking statements regarding NBT Bancorp Inc. These statements constitute forward-looking information within the definition of the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from any forward-