PSB Holdings, Inc. · OTC:PSBQ
PSB — Raymond James Emerging Bank Symposium 2020
27 slides from PSB's conference presentation, Nov 10, 2020
Slide 1: PSB Holdings, Inc. Raymond James Emerging Bank Symposium
PSB Holdings, Inc. “PSBQ” Raymond James Emerging Bank Symposium Virtual Presentation November 10, 2020 1
Slide 2: Cautionary Note Regarding Forward-Looking Statements
PSB Holdings, Inc. Cautionary Note Regarding “PSBQ” Forward-Looking Statements Certain matters discussed in this presentation, including those relating to the growth of PSB, its profits, and future interest rates, are forward-looking statements and are made pursuant to the safe harbor provisions of
Slide 3: Management Team
PSB Holdings, Inc. Management Team “PSBQ” Scott M. Cattanach has served as President & Chief Executive Officer of PSB Holdings, Inc. (“PSB”) and Peoples State Bank (“Bank”) since 2018. Mr. Cattanach previously served as Chief Financial Officer of PSB and the Bank from 2002 through 2017. Mr. Cattanac
Slide 4: Overview
PSB Holdings, Inc. Overview “PSBQ” • PSB Holdings, Inc. ($1.1 billion in assets) is the parent company of Peoples State Bank headquartered in Wausau, Wisconsin, serving north central Wisconsin from nine full-service banking locations in Marathon, Oneida, Vilas and Milwaukee counties and loan product
Slide 5: Community Reach
PSB Holdings, Inc. Community Reach “PSBQ” Community Based Business Lending Wealth Residential Management Mortgage Lending PSB Holdings, PSB Holdings, Inc. Inc. Treasury Community Management Ambassadors Services Digital Delivery 5
Slide 6: COVID-19 Impact Industries
PSB Holdings, Inc. COVID-19 “PSBQ” Impact Industries Industry Concentration as of September 30, 2020 6
Slide 7: COVID-19 Impact Industries
PSB Holdings, Inc. COVID-19 “PSBQ” Impact Industries Restaurants Hotels Other • $26.6M, or 3.1% of total • $34.4M, or 4.3% of total • $3.0M or 0.4% of total loan portfolio at September loan portfolio at September loans portfolio consist of 30, 2020 30, 2020 loan deferrals in various industries inclu
Slide 8: COVID-19 Loan Deferrals
PSB Holdings, Inc. COVID-19 “PSBQ” Loan Deferrals Round 1 D eferrals Round 2 D eferrals Round 1 D eferrals Round 2 D eferrals (%) (%) (D ollars and C ounts) (D ollars and C ounts) Balance 17.50% 2.50% $143M $20M Account Relationships 4.40% 1.70% 114 44 Loan Deferrals $30,000,000 $25,000,000 $20,000,
Slide 9: Asset Quality Trends
PSB Holdings, Inc. Asset Quality Trends “PSBQ” Commercial, Commercial Real Estate, Construction & Development, Agricultural and Government Loans ($000) Risk Rating 12/2016 12/2017 12/2018 12/2019 03/2020 06/2020 09/2020 Rating 1 "High Quality" $ - $ - $ - $ - $ 71 $ 55 $ - Rating 2 "Minimal Risk" 67
Slide 10: Economic Recovery
PSB Holdings, Inc. Economic Recovery “PSBQ” Unemployment Rates in Primary Markets Compared to State and National Averages 21.0 18.0 15.0 12.0 9.0 6.0 3.0 0.0 Dec-19 Jan-20 Feb-20 Mar-20 Apr-20 May-20 Jun-20 Jul-20 Aug-20 Sep-20 United States 3.5 3.6 3.5 4.4 14.7 13.3 11.2 10.2 8.4 7.9 Wisconsin 3.5
Slide 11: Branch Locations
PSB Holdings, Inc. Branch Locations “PSBQ” M arathon C ounty 6/30/2020 N orthern Wisconsin 6/30/2020 Loan Production Office D eposits D eposits Address C ity ($000) Street Address C ity ($000) 1905 Stewart Ave Wausau $402,967 8 E An derson St Rh in elan der $110,898 314 Main St Marath on $106,543 95
Slide 12: Business Model Strengths
PSB Holdings, Inc. Business Model “PSBQ” Strengths Consistent History of Strong Earnings Supported by low efficiency ratios and low-costing funds Well Diversified Loan Portfolio Industry sectors are not concentrated and represent “a little of a lot” of business types Strong Presence In All Branch Ma
Slide 13: Shareholder Value Strategies
PSB Holdings, Inc. Shareholder Value “PSBQ” Strategies Prolonged Success in Putting The Wisconsin Banking Shareholder Capital to Work Market is Ripe for • ROAE has averaged 11.2% Consolidation since 2010 • There are 68 banks in WI • 27 consecutive years of with assets between $100M dividend increase
Slide 14: Balance Sheet Trends
PSB Holdings, Inc. Balance Sheet Trends “PSBQ” Total Assets (Dollars in Thousands) $1,200,000 $1,104,283 $1,100,000 $1,000,000 $974,893 $915,998 $900,000 $847,681 $827,528 $784,410 $800,000 $734,367 $700,000 $600,000 $500,000 2014 2015 2016 2017 2018 2019 2020 3Q YTD Tangible C ommon Equity (Dollars
Slide 15: Earnings Trends
PSB Holdings, Inc. Earnings Trends “PSBQ” RO AA RO ATC E 1.40% 16.00% 1.19% 1.22% 14.00% 13.46% 1.20% 12.48% 12.77% 1.03% 1.07% 12.17% 0.95% 12.00% 10.83% 1.00% 0.90% 10.23% 0.87% 9.84% 10.00% 0.80% 8.00% 0.60% 6.00% 0.40% 4.00% 0.20% 2.00% 0.00% 0.00% 2014 2015 2016 2017 2018 2019 2020 3Q YTD 2014
Slide 16: Loan Loss Reserves
PSB Holdings, Inc. Loan Loss Reserves “PSBQ” Loan Loss Reserves/Total Loans 1.90 1.70 1.50 1.30 1.10 0.90 0.70 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 3Q 2020 MW Banks Between $500M & $5B 1.13 1.20 1.43 1.56 1.61 1.56 1.49 1.36 1.29 1.21 1.17 1.17 1.17 1.23 Wisc Banks Betwee
Slide 17: Per Share Trends
PSB Holdings, Inc. Per Share Trends “PSBQ” EPS Tangible Book Value Per Share $3.00 $25.00 $22.73 $2.51 $23.00 $2.50 $2.29 $20.72 $21.00 $19.00 $17.98 $2.00 $1.83 $1.61 $1.67 $17.00 $16.28 $1.58 $15.08 $1.50 $1.30 $15.00 $13.72 $12.51 $13.00 $1.00 $11.00 $9.00 $0.50 $7.00 $0.00 $5.00 2014 2015 2016 2
Slide 18: Net Income Trends
PSB Holdings, Inc. Net Income Trends “PSBQ” N et Income and Diluted Earnings Per Share $12,000 $3.00 $2.51 $10,000 $2.29 $2.50 $2.23 $8,000 $1.83 $2.00 (D0llars in Thousands) $1.61 $1.58 $6,000 $1.30 $1.50 $4,000 $1.00 $2,000 $0.50 $0 $0.00 2014 2015 2016 2017 2018 2019 2020YTD N et Income Annualize
Slide 19: Asset Quality Trends
PSB Holdings, Inc. Asset Quality Trends “PSBQ” N PA/Assets, Reserves/Total Loans and C harge-O ff H istory 3.00% 2.81% 2.87% 2.64% 2.50% 2.08% 1.96% 2.00% 1.77% 1.46% 1.49% 1.50% 1.31% 1.27% 1.04% 1.00% 0.83% 0.85% 0.67% 0.55% 0.50% 0.23% 0.00% 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Slide 20: Loan Portfolio
PSB Holdings, Inc. Loan Portfolio “PSBQ” 30.0% 27.0% 25.7% 25.0% 25.0% 22.7% 20.4% 20.0% 18.3% 17.1% % of Loans 14.2% 15.0% 9.5% 10.0% 8.6% 6.7% 4.8% 5.0% 0.0% O ther 1-4 Fam C RE O wner -O cc C RE N on-O wner O cc C &I C onstr & Land 9/30/2019 9/30/2020 LO AN PO RTFO LIO TREN DS $850,000 $804,742 (
Slide 21: Paycheck Protection Program (PPP)
PSB Holdings, Inc. Paycheck Protection “PSBQ” Program (“PPP”) People State Bank’s Response By The Numbers: • PPP Loans Approved: 736 • Total Dollars Deployed: $116.9 Million • Loans Over $1.0 Million: 21 • Average Loan: $159,000 • State Rank in Total PPP Loan Production: 12th in State • State Rank i
Slide 22: PPP Production
PSB Holdings, Inc. PPP Production “PSBQ” Top 10 Publicly Traded Wisconsin Banks Paycheck Pro tectio n Pro gram L o an M o dificatio n Paycheck Pro tectio n Pro cessing Fees C O V ID - 19 L o an C O V ID - 19 L o an PPP L o an R atio Pro gram L o an PPP L o an R atio o n PPP L o ans M o dificatio n M
Slide 23: Milwaukee
PSB Holdings, Inc. Milwaukee “PSBQ” $300,000 $250,000 $200,000 (Dollars in Thousands) $150,000 $100,000 $50,000 $- Total Bank Loan G rowth M ilwaukee G rowth 23
Slide 24: Deposit Portfolio
PSB Holdings, Inc. Deposit Portfolio “PSBQ” Wholesale Deposits Retail & Local Time M oney M arket Demand Int Bearing Demand &Savings N onint-Bearing Demand 40.00% 35.00% 19.0% 20.9% 21.6% 20.5% 22.6% 32.3% 30.00% 30.9% 32.9% 34.1% 35.1% 33.0% 25.00% 32.3% 20.00% 22.6% 20.7% 20.1% 20.0% 23.5% 15.00%
Slide 25: Disciplined Acquisition Strategy
PSB Holdings, Inc. Disciplined Acquisition “PSBQ” Strategy Areas of Potential Acquisition Opportunities q Smart consolidation of community banks § Provides scale and operating efficiencies PSBQ Locations § Adds experienced and knowledgeable banking talent PSBQ LPO § Opportunity to drive scale and fi
Slide 26: Key Data at a Glance
PSB Holdings, Inc. Key Data at a Glance “PSBQ” 2020 (Dollars in Thousands) 2015 2016 2017 2018 2019 3QYTD Total Assets $784,410 $827,528 $847,681 $915,998 $974,893 $1,104,283 Total Loans $535,325 $586,911 $610,076 $658,839 $707,651 $792,854 Total Deposits $666,176 $686,760 $702,303 $725,826 $781,790
Slide 27: Investment Appeal
PSB Holdings, Inc. Investment Appeal “PSBQ” Value Investment With Core P/E Ratio Well Below Peers Extended History of Delivering Double Digit Returns on Tangible Equity Efficient Franchise With Significant Market Presence in Each Branch Market Area Ample Prospective Acquisition Roll-Up Opportunities
PSB Holdings — Raymond James Emerging Bank Symposium 2020 on 6ix