Axos Financial, Inc. · NYSE:AX
Axos Financial — BofI Holding — Raymond James 34th Annual Institutional Investors Conference 2013
25 slides from Axos Financial's conference presentation, Mar 6, 2013
Slide 1: BofI Holding, Inc. Investor Presentation
BofI Holding, Inc. Investor Presentation Greg Garrabrants President and Chief Executive Officer NASDAQ: BOFI RAYMOND JAMES 34th Annual Institutional Investors Conference March 3-6, 2013
Slide 2: Safe Harbor
1 Safe Harbor This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 (the “Reform Act”). The words “believe,” “expect,” “anticipate,” “estimate,” “project,” or the negation thereof or similar expressions constitute forward-loo
Slide 3: Q2 Fiscal 2013 Financial Highlights
2 Q2 Fiscal 2013 Financial Highlights Q2 2013 vs. Q2 2012 $650.5 $415.0 $628.8 $200.0 78 bps $9.8 29.3% 26.7% 41.2% 151.2% 14 bps 46.7% Asset growth Deposit growth Loan portfolio growth Loan portfolio origination growth Non-performing assets to total assets Q2 Net Income Amount ($M or %) Increase (%
Slide 4: BofI Consistently Ranked among the Best of the Biggest Thrifts by SNL
3 BofI is Consistently Ranked among the Best of the Biggest Thrifts by SNL Financial … BofI Holding, Inc. (BOFI) 2 CA 127.12 1,736 1.29 15.44 15.16 39.43 1.51 0.45 BofI Holding, Inc. (BOFI) 3 5 CA 89.40 1,401.1 1.16 15.87 13.14 32.23 1.21 0.80 2010 The Best of the Biggest Thrifts 2009 The Best of th
Slide 5: Top Performer among All Public Banks and Thrifts
4 … and is also a Top Performer among the Broader Universe of All Public Banks and Thrifts 2012 rank 2011 rank Total assets ($000) 2011 ROAE (%) 2011 ROAA (%) Non-interest income/total revenue (%) Capital ratio (%) Efficiency ratio (%) Non- performing loans/total loans (%) 1 1 Bank of the Ozarks, Li
Slide 6: BofI is a Top Quartile Performer Versus Bank Peer Group
5 BofI is a Top Quartile Performer Versus Bank Peer Group BofI Federal Bank Peer Group Percentile ROAA 1.54% 0.80% 88% Return on equity 17.97% 6.57% 94% G&A 1.56% 2.72% 16% Efficiency ratio 33.47% 66.34% 4% Note: Peer group is all savings banks with assets greater than $1 billion for quarter ended S
Slide 7: Our Business Model is More Profitable Because Our Costs are Lower
6 Our Business Model is More Profitable Because Our Costs are Lower… Salaries and benefits Premises and equipment BofI1 (%) 0.87 0.14 Other non-interest expense 0.66 Total non-interest expense 1.67 Core business margin 2.02 1.53 0.37 1.27 3.17 0.43 Banks $1-$10bn2 (%) Net interest income 3.69 3.60 A
Slide 8: Efficiency Ratio One of the Industry's Lowest
7 Efficiency Ratio (BofI Federal Bank, for the fiscal quarter ended) 32.62 32.74 34.85 63.11 0 20 40 60 80 (%) Banks1 Q1 ‘13 Q4 ‘12 Q3 ’12 One of the lowest rates in the industry 1. Reported by FDIC – 437 commercial banks with $1-$10 billion in assets for the quarter ended 9/30/12 Source: FDIC Stati
Slide 9: Corporate Profile and Vision
8 Corporate Profile and Vision $2.9 billion asset savings and loan holding company1 12-year operating history, publicly traded on NASDAQ (BOFI) since 2005 Headquartered in single branch location in San Diego, CA 40,000 deposit and loan customers1 280 employees ($10 million in assets per em
Slide 10: Diversified Branchless Customer Acquisition Channels
9 Diversified Branchless Customer Acquisition Channels Co n s u m e r o n lin e b ra n d s Description • Value-oriented consumer • High-end/older demographic • Airline rewards oriented • Wider demographic • Business checking • Products tailored to financial planning advisors and customers Bank brand
Slide 11: Preference Toward Delivery has Shifted Rapidly Toward the Internet
10 Preference Toward Delivery has Shifted Rapidly Toward the Internet Over the Last Four Years Preferred Banking Method (2011) Preferred Banking Method (2007) Other 20% ATM 21% Branches 36% Internet Banking 23% Other 10% ATM 8% Branches 20% Internet Banking 62% Source: American Banker Association
Slide 12: Need For Branches to Deposit Checks Dropping Quickly
11 With the Need For Branches to Deposit Checks Dropping Quickly Avg. deposits per day per branch 250 50 0 2012 2010 2014 300 100 150 2008 200 2006 Check decline only With RDC • 45% decline from 2006 to 2011 • Additional decline by 2014 of 90% with Remote Deposit Capture Implementation Check decline
Slide 13: Branch Traffic has Declined Approximately 4.0% per Year
12 Branch Traffic has Declined Approximately 4.0% per Year for an Aggregated Decline of 90% Over the Last 16 Years Source: FMSI 2011 Teller Line Study; ICBA Independent Banker Magazine, March 2011 "Branch foot-traffic is plummeting and branches are largely idle, except for the activities of the empl
Slide 14: Branch Banks are Losing Sources of Revenue that Supported Free Checking
13 Branch Banks are Losing Sources of Revenue that Supported "Free" Checking Interchange Income Average Transaction Fee Bank Service Charges 0.4 0.2 0.0 -55% Post-Durbin 0.21 Pre-Durbin 0.44 Cents 0.6 $ Billions 2.70 2 1 Q4 2009 3 0 -20% Q4 2010 2.30 • Interchange is roughly 20% on non- interest inc
Slide 15: Banks over $50 Billion Offering Free Checking Dropped to Less than 35%
14 Banks over $50 Billion Dollars in Assets Offering Free Checking Dropped to Less than 35% from 96% in One Year Source: American Banker 80 Thousands 60 20 2010 100 40 0 34.8% 2009 96.0% -61.2% Represents a secular trend toward less competitive products at banks with branch-based cost structures Ban
Slide 16: Enhanced Value Proposition for Deposit Customers
15 Enhanced Value Proposition for Deposit Customers Product Customer Service Platform Features • Free checking with unlimited ATM reimbursement • Rate rewards features • Merchant/purchase rewards • Enhanced call center representatives training • Call center representative extended hours • Outbound c
Slide 17: CNN Money Highlighted the Bank's Checking Account
16 CNN Money Recently Highlighted the Bank’s Checking Account in its Article Describing the Bank as “One of 7 Banks That Is Still Awesome” Note: Information as of October 2011
Slide 18: Key Areas of Growth
17 Key Areas of Growth Growth: 12/11-12/12 Checking balance 132.97% MMS balance 105.27% Savings balance -13.53% CD balance -27.31% Transaction account balance 113.83% Gen Y (1978-1994) 1 34.4% of accounts, 34.3% of account bal Gen X (1965-1977) 1 15.6% of accounts, 9.7% of account bal Key Growth 1 T
Slide 19: Primary Business – Lending
18 Primary Business – Lending 1. Percent of total originations and purchases for quarter ended December 31, 2012 Lending Single family Multifamily Capital Markets Gain-on-sale Mortgage Banking Wholesale Jumbo Retail Wholesale Loan Purchases and Sales Loan Originations • Internet and affinity lead so
Slide 20: Rapid Asset Growth Driven by Organic Loan Production
19 Our Rapid Asset Growth has been Driven by Strong and Profitable Organic Loan Production Loan Portfolio – End of Last Five Quarters Multifamily Single family 52% 54% 54% 55% 55% 52% 54% 54% 54% 54% Average Loan to Value 1,526,523 1,595,704 1,720,563 1,912,999 2,155,306 0 500,000 1,000,000 1,500,00
Slide 21: Loan Origination Group Production Year over Year
20 Loan Origination Group Production Year over Year 1. Applications in as of 02/01/13 Q2-2013 Q2-2012 ($ Millions) Production Production Pipeline1 Single Family – Gain on Sale $232.3 $132.8 $93.3 Single Family – Jumbo Portfolio 174.9 121.5 216.6 Single Family – Warehouse 80.4 0.0 121.4 Multifamily –
Slide 22: Best in Class Asset Quality
21 1.03 3.09 0 1 2 3 4 (%) BofI1 Banks $1-10 bn Non-current (30 days+) loans to total loans1 Assets in non-accrual to total assets1 0.79 1.42 0 1 2 3 4 (%) BofI1 Bank $1-10 bn 1. As reported in FDIC SDI report at 9/30/12. Total of 437 institutions included in the $1-$10 billion group. Best in Class
Slide 23: Loan Diversity – December 31, 2012
22 Loan Portfolio1 100% = $2,186 Million 56 1 35 1 7 Multifamily SF residential Home equity Commercial Consumer and other 1. Gross loans before premiums, discounts and allowances Loan Diversity – December 31, 2012
Slide 24: Investment Summary
23 Full service branchless banking platform with structural cost advantages vs. traditional banks Superior growth and ROE relative to large and small competitors Solid track record of allocating capital to businesses with best risk-adjusted returns New business initiatives will generate incremental
Slide 25: Contact Information
24 COMPANY Greg Garrabrants, President and CEO BofI Holding, Inc. [email protected] www.bofiholding.com Investor Relations Mark A. McPartland, Senior Vice President MZ Group Phone: +1-646-593-7140 Mobile: +1-910-297-6442 [email protected] www.mzgroup.com Contact Information
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