Peoples Bancorp Inc. · NASDAQ:PEBO
Peoples Bancorp — Investor Presentation (May 2017)
21 slides from Peoples Bancorp's investor presentation, May 8, 2017
Slide 1: Investor Presentation 1st Quarter 2017
Peoples () Investor Presentation 1* Quarter 2017 Harbor Statement € Statements in this presentation which are not historical are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, a
Slide 2: Profile and Investment Rationale
* Profile and Investment Rationale ¢ Strategy * Q1 2017 Performance * Performance Outlook Appendix Profile and Investment Rationale —— BANCORP (Peoples @)
Slide 3: Corporate Profile and Investment Rationale
Corporate Profile + Financial holding company headquartered in Marietta, Ohio. — Provides a broad range of banking, insurance, and investment services * Current snapshot — Assets: $3.5 billion; Loans: $2.2 billion — Deposits: $2.7 billion — Market capitalization: $632 million — Assets Under Admin/Ma
Slide 4: Strategy
\ Strategy ‘Peoples () Strategic Road Map “Best Community Bank in America” Responsible ‘traordinary Le ae Profitable Revenue Growth Superior Workforce Risk Management | ClientExperionce + Our Way of Life + Broad Delivery Channels _ + RightPeople / RightJob ali dicbvBoee . + Asset Quality rere sh a S
Slide 5: Strategic Priorities and Targets
Strategic Pronties Positive e Focused on sustainable revenue growth Opera’ ting ¢ Disciplined expense management 4 ¢ Expand revenue vs. expense growth gap beyond 2% Leverage ¢ Dnive core efficiency ratio toward 60% ey . ~) Superior * Balance growth with prudent credit practices Asset ¢ Improve diver
Slide 6: Our Capabilities
Our Capabilities Amazon Kindle Ap Banking Mobile Deposit Capabilitie iy Indintes Pooper neadnmg ovr Community 7 Peoples ( f Information accmate a: of Apel 25, 9017 Bank grou ——= sancorp ll PEBO Market Insipbt ay) ea ¢ Strongest deposit market share positions in more rural markets where we can affect
Slide 7: Q1 2017 Performance
Q1 2017 Performance / Peop les ¢ Feoples ( chats ¢ Reported record first quarter 2017 earnings of $8.8 million ¢ Grewloansby 4% annualized, compared to December31, 2016, with strong performance in both Indirectand Commercial & Industrial Lending ¢ Efficiency ratio below 65% via expense controls ¢ Im
Slide 8: Operating Leverage and Operating Expenses
Operating Leverage ‘ay Operating leverage is the difference between revenue growth and expense growth. It was flatfor Q1 2017 and positive for each of the previous 5 quarters versus the prior year quarter, as revenue growth exceeded expense growth, ye 38% 40% Y 35m Y 50% i 25% . aa 13% 15% I~ 12% >
Slide 9: Efficiency has improved as a result of expense control and revenue growth
Efficiency has improved as a result of expense control and revenue growth 61.49% 68.00% _ 67.00% 66.00% (4.7%) YOY 64.85% Improvement from 20150 65.00% 2016 ma 6F hl ma 6 Ul CU El maa 6€6«l iy 61.00% + t + + + t t FY 2015 10-16 2Q-16 3Q-16 4Q-16 FY 2016 10-17 + “The Core Efficiency Ratio is a non GA
Slide 10: Asset Quality
Asset Quality Criticized and Classified loan levels remain reasonably stable $50,000 45.0% $45,000 365% re 38.2% 40.056 $40,000 | 342% ge 33.3% | 35.0% $35,000 Se 904% 299% 30.1% | , ST 0.056 i 22.1% | 25.0% 17.4% 16.8% | 20.0% 16.2% 16.5% $20,000 $15,000 + 15.096 $10,000 10.096 $5,000 + 5.096 $ 0.0
Slide 11: Concentration Analysis; Loan and Deposit Composition
Concentration Analysis Peer Bank Subs --CLD Loans / Risk-Based Capital | 31% CPE EE EEL IP IE IE SHE SF EEIIEOESIFEP CEH “é — » Verte Fan} Coumen Bat pens asve 1 Neapalanis COCHEE Gattect, CLD Lea afaed mc bea les - (Sette ha adhd deat CRE Lor needs one owmnarceeupied CRE toaas (ine mdingCLD) —————
Slide 12: Insurance & Investment Income Composition; Business Highlights
Insurance & Investment Income Compose i Shenae im — Other Brokerage 29.9% ** Approximately 90% attributable to P&C Commercial Lines / Peoples () * Trailing Twelve Months from 3/81/17 23 BANCORP Business Highlights ‘ay * Commercial Banking Average loans up 2% and average deposits up 7% from December
Slide 13: Performance Outlook
Performance Outlook ‘ Peop 2017 Targets Continue driving organic loan growth Sustain net interest margin Grow fee-based revenues Control expense growth Maintain or improve efficiency ratio Return to top-quartile asset quality (expected net charge-off levels) "Peoples ¢ 26
Slide 14: Other Outlook Considerations
Other Outlook Consideration ¢ Continue executing on acquisition strategy — Purswingmsurance and investment acquisition opportunities to build fee-based revenue — Given our improved stock price and the completion of our system upgrade, we believe there is potential for a bank acquisition in 2017 — Le
Slide 15: Summary Quarterly
Summary Quarterly Metrics 3/31/16 ou) 12/31/16 OU) 3/31/17 Investment securities S$ 885,462 -18% $ 859,455 12% $ 869354] Gross loans 2,105,115 69% 2,224,936 11% 2249,502 Allowance for loan losses (17,261) 79% (18,429) 0.2% (18,468)| Ne % 1% Balance Shieé jet loans 2,087,854 69 2,206,507 1.1% 2,231,0
Slide 16: Pre-Provision Net Revenue Growth
Pre-Provision Net Reyentie Grow Q1 2017 PPNRis ata 5-Quarter High, and PPNR/Average Assets is up 13% over Q4 2016 mn 148% 14% — 4 ago, 1.83% 152% | 1.6056 $50,000 ~138% — 1.4096 + 1,20% $40,000 1.0036 096 j $30,000 0.809% $20,000 0.6096 0.4096 $10,000 0.2096 $ + + + + + + 0.0096, FY-2015 FY-2016 Q1-
Slide 17: Annual Financial Summary
Annual Financial Suminiany, YE Metrics = Increase 2016 (@ecrease) Diluted EPS $0.61 $1.71 180.3% Retum on average stockholders’ equity 2.69% 7.20% 167.7% Retum on average tangible stockholWers' equity (1) 5.16% 11.86% 129.8% Financial Retum on average assets 0.35% 0.94% 168.6% igsgurritas| Pre-provi
Slide 18: Non-GAAP Measures
Non-GAAP Measures PRE-PROV ION NET REVENUE Pre-provision net revenue (PPNR) represents a non-GAAP financial measure commonly used to evaluate the operating performance and trends of financial services companies, including Peoples. PPNR represents the earnings capacity that can be either retained in
Slide 19: Non-GAAP Measures
Non-GAAP Measures CORE FEE-BASEDINCOME Corefee-based income is non-GAAP since it excludes the impact of system upgrade revenue waived. (S in Thousands) FY 2015 Ql 2016 Q2 2016 Q3 2016 Q4 2016 Fy 2016 QI 2017 Total fee-based income $ 47441 $ 13,054 $ 12,367 $ 13,538 $ 12.111 $ 51,070 $ 13,334 Plus: S
Slide 20: Non-GAAP Measures
Non-GAAP Measures ADJUSTED EFFICIENC RATIO The adjusted efficiency ratio is a key financial measure used to monitor performance. The adjusted efficiency ratio is calculated as core non-interest expense (less amortization of other intangible assets) as a percentage of fully tax-equivalent net interes
Slide 21: Non-GAAP Measures
Non-GAAP Measures RETURN ON AVERAGE TANGIBLE STOCKHOLDERS’ EQUITY Return on average tangible stockholders’ equity is calculated as net income (less after-tax impact of amortization of other intangible assets) divided by average tangible stockholders’ equity. This measure is non-GAAP since it exclude