Waccamaw Bankshares — IPO Roadshow (June 2010)
36 slides from Waccamaw Bankshares's IPO roadshow presentation, Jun 18, 2010
Slide 1: Waccamaw Bankshares, Inc. June 2010
June 2010 Waccamaw Bankshares, Inc. (NASDAQ: WBNK) Whiteville, NC Filed pursuant to Rule 433 Registration No. 333-160436 Dated June 17, 2010
Slide 2: Forward-looking statements and offering notice
This presentation may include forward-looking statements. These forward-looking statements are based on current expectations that involve risks, uncertainties and assumptions. Should one or more of these risks or uncertainties materialize or should underlying assumptions prove incorrect, actual resu
Slide 3: Issuer and offering terms
Issuer: Waccamaw Bankshares, Inc. (NASDAQ: WBNK) Type of Offering: Follow-On Public Offering Type of Security: Common Stock Transaction Size: 30,000,000 Common Shares Company Option to Increase Deal Size: 15% Use of Proceeds: Enhance Capital Ratios, Redeem Outstanding Indebtedness, General Corporate
Slide 4: Significantly strengthen capital position
Significantly strengthen capital position Allows Bank to comfortably exceed minimum ratios for “Well Capitalized” status Position Waccamaw to capitalize upon recent dislocations in market FDIC seizures provide market opportunity in WBNK’s coastal markets Enable WBNK to actively pursue its business s
Slide 5: Founded 1997 in Whiteville, North Carolina
Founded 1997 in Whiteville, North Carolina $586MM assets at 3/31/2010 NASDAQ: WBNK Whiteville has strong history in banking Former headquarters of UCB, $4B in assets when sold in 1996 to BB&T 17 branch locations, 11 opened in past 5 years Strong record of historical growth Experienced management tea
Slide 6: Recent branch additions represent only 25% of deposits
Recent 11 branch additions represent only 25% of deposits but cover the largest markets Dislocations of key coastal institutions creates market opportunity : Beach First $600MM (FDIC closure/subsequent takeover) Cape Fear $500MM (FDIC closure/subsequent takeover) Cooperative $1B (FDIC closure/subseq
Slide 7: Footprint includes prominent coastal communities
Footprint includes several prominent coastal communities that are likely to rebound as the economy recovers. Long-term demographics remain attractive for these areas given historical migration patterns, the effects of tourism and the broad based appeal of the Carolinas.
Slide 8: Management team: years at WBNK and in banking
Years at WBNK Years in Banking James G. Graham President & CEO, Director David A. Godwin CFO J. Daniel Hardy, Jr. Chief Lending Officer Kim T. Hutchens Chief Administrative Officer Richard C. Norris Chief Credit Officer Freda H. Gore Chief Operations Officer Geoffrey R. Hopkins Senior Commercial Len
Slide 9: Management biographies
James G. Graham , 60, a Director of the Company since 1999, is President and Chief Executive Officer of Waccamaw Bank and Waccamaw Bankshares, Inc. As a banker for 38 years, he has served as a community bank CEO for 25 of those years having served as President and Chief Executive Officer of Commonwe
Slide 10: Management biographies (continued)
Richard C. Norris , 44, Senior Vice President and Chief Credit Officer of Waccamaw Bank and Waccamaw Bankshares, Inc. since 2003. Prior to that Senior Business Underwriter, Business Central Underwriting, and Commercial Banking Manager of First Citizens Bank in Raleigh, North Carolina from 1996 to 20
Slide 11: Deposit growth
DEPOSIT GROWTH ($MMS, YEARS AS OF JUNE 30) COUNTY DEPOSIT COMPOSITION IN 2009 Source: 10-Ks, 10-Q Source: Company reports
Slide 12: Market position
MARKET POSITION
Slide 13: Total market
Source: FDIC Total Market Market Deposits % of MSA Rank Branches (000s) Franchise Wilmington 6,077,532 27% Myrtle Beach/Conway/N. Myrtle 5,582,140 6% Counties/Cities Not in any MSA Columbus County (Whiteville areas) 785,117 60% Bladen County (Elizabethtown) 251,978 5% Lancaster County (SC) 387,648 2
Slide 14: Market demographics
MARKET DEMOGRAPHICS
Slide 15: Market demographics by county
Household Projected Total Market Projected Approximate Income Population Deposits Population Household Change Growth New Markets (000s) Income ($) 1999-2008 2010-2019 Brunswick County (NC Coastal) 1,612,014 110,292 35,888 29% 26% New Hanover County (Wilmington) 4,110,629 196,191 40,172 28% 10% Horry
Slide 16: Wilmington, NC MSA market rank
Aw ®. [WIL MINGTON, NC MSA. eat Oulade of Trade oh IWBIIK: 12th Market Rank of 22 Total Market Market Sate | tod | Depaats | Noch | Oeposts | wanet lnstitticn (Hera) | offices | gooos | offces | $000: _| share lpRaNcHaAVKINGR TAUSTCO. NE TT (ACHOVIA BANK NATIONALASSH. NE | 328) se3.s7is| ol at7.tail
Slide 17: Leading position in anchor markets
LEADING POSITION N ANCHOR MARKETS (Whiteville, NC (City) S0-Ja uae WB INK: 1st Market Rank of 7 Total Market Wate [Neck | Deets Te ot lnatution tara) | ofices | go00s | ofices /ACCAMAW BANK NC ae] asae3e] al RANCH BANKING £TRUSTCO) Ne | asoel Sass zial BANK USA NC 33]_tga2o.| | RST.CTIZENS EANKETRUS
Slide 18: Solid historical growth
Solid Historical Growth Beis = Overall balance 600 » Avg. Deposits sheet growth has . been consistent 500 ‘Avg. Loans - Balance sheet risk has been mitigated we by declining percentage of loans in the asset base - Deposit growth compounded at 14.4% from 2005 to 3/31/2010; assets at 16.8% annually 30
Slide 19: Increased brokered deposits to extend maturity
Increased Brokered Deposits to Extend Maturity Brokered Deps Brokered deposits were increased in QL’LO to extend 400 maturities and lock in the refunding of $30 ae MM in peed deposit run-off 20) expected in the next 6 to 8 months 100 This better 0 positions Bank for an increase in rates 2007 2008 20
Slide 20: Focus expanded from rural markets to coastal regions
Focus has expanded from slow growth rural markets to coastal regions with larger deposit bases & favorable long- term growth prospects Strategic investment in new coastal branches (11 in the past 5 years) has established a solid foothold in these high growth markets Dislocations of large community b
Slide 21: Positive earnings $288,000, $0.05 per share
Positive Earnings $288,000, $0.05 per share Pre-tax, pre-provision income before security gains was $938,000, vs $368,000 in Q1 ‘09 +15% Noninterest income excluding security gains, $1.3MM Containing Expenses Noninterest expense down 11% vs Q1 ‘09 Increased Reserves Allowance for loan losses 3.05% o
Slide 22: Newest branches
Newest branches include: Shallotte (NC) , Oak Island (NC), Conway Medical (SC), Socastee (SC) Little River (SC) Source: Company reports Source: Company reports
Slide 23: 10-Qs, Company Calculations
10-Qs, Company Calculations 10-Qs, Company Calculations * Post preferred dividends when applicable
Slide 24: Core deposits as of March 31, 2010
AS OF MARCH 31, 2010 CORE DEPOSITS $187.7 MM AVG COST OF FUNDS 2.10% VS 2.80% Q1 ‘09 INCREASING CORE DEPOSITS WILL FURTHER REDUCE FUNDING COSTS Source: Call Report Source: Call Report
Slide 25: Credit administration
Credit Administration Experienced Credit Review Officer with years experience, ten at WBNK; ten at UCB Internal Credit Review Dedicated Loan Review Specialist Semiannual external loan review Centralized Underwriting and Approval Process all consumer and small business lending effective 12/31/09 Annu
Slide 26: Loan types and nonperforming assets
Loan Type Outstanding Loan Balance ($mm) % of Total Nonaccrual Loans ($mm) Nonaccrual/ Outstanding Loan Balance Accruing Loans > 90 Delinquent OREO ($mm) Total NPAs ($mm) 30 – 90 Day Delinquent ($mm) As of March 31, 2010 Construction & Development 33% 20.7 18.4% 0.6 5.2 26.5 7.7 1 – 4 Family Mortgag
Slide 27: Delinquencies and nonperforming assets by date
Date 30 - 89 Days Past Due ($mm) Accruing Loans > 90 Delinquent Delinquent Loans ($mm) Nonaccrual Loans ($mm) OREO ($mm) Total NPAs ($mm) September 30, 2009 9.9 2.4 12.3 22.8 5.5 30.7 December 31, 2009 26.3 1.4 27.7 21.5 5.0 27.9 March 31, 2010 13.7 1.2 14.9 31.1 8.1 40.4 Source: Call Report
Slide 28: Past due and nonaccrual loans by type
30 – 89 Days Past Due > 90 Days Past Due Nonaccrual Loans Loan Type 9/30/2009 12/31/2009 3/31/2010 9/30/2009 12/31/2009 3/31/2010 9/30/2009 12/31/2009 3/31/2010 Construction & Development 1.5 16.2 7.7 1.3 0.6 0.6 13.5 14.0 20.7 1 – 4 Family Mortgages 2.4 2.5 0.4 0.6 0.7 0.4 2.4 2.4 2.6 Multifamily R
Slide 29: Loans by collateral location
($Millions, Based on location of collateral) Source: Company Reports
Slide 30: Loans by geography and type
BY GEOGRAPHY (COUNTY) BY TYPE (TOTAL $343 MM) Source: Call Report Source: Company Reports
Slide 31: Loans by geography and type
BY GEOGRAPHY (COUNTY) BY TYPE ($112MM) Source: Company Reports Source: Company Reports
Slide 32: Appendix
Source: 10-Q, Company Calculations
Slide 33: Recent branch additions represent only 25% of deposits
Recent 11 branch additions represent only 25% of deposits but cover the largest markets Dislocations of key coastal institutions creates market opportunity : Beach First $600MM (FDIC closure/subsequent takeover) Cape Fear $500MM (FDIC closure/subsequent takeover) Cooperative $1B (FDIC closure/subseq
Slide 34: Assets
Source: 10-Ks, 10-Q Assets 3/31/2010 Cash and Due from Banks $9,183 $11,809 $8,948 $13,973 $9,081 Interest Bearing Deposits 2,685 7,695 79,283 Federal Funds Sold 2,598 - 4,281 21,315 6,565 Total Cash and Equivalents 12,572 12,721 15,913 42,984 94,929 Investment Securities 50,529 99,302 87,403 87,769
Slide 35: Income statement summary
Source: 10-Ks, 10-Q Twelve Months Ended: 3 Months Ended: 3/31/2010 (In $000s, except per share data) Interest Income 25,379 31,637 30,485 25,889 5,601 Interest Expense (11,226) (16,296) (16,934) (12,536) (2,526) Net Interest Income 14,153 15,341 13,551 13,353 3,074 Provision for Loan Losses (1,450)
Slide 36: Waccamaw Bankshares, Inc. June 2010
June 2010 Waccamaw Bankshares, Inc. (NASDAQ: WBNK) Whiteville, NC