ECB BANCORP, INC. Gulf South Bank Conference May 14 – May 16, 2012 Exhibit 99.1 |
Forward Looking Statements 2 ECB BANCORP, INC. Statements in this presentation relating to plans, strategies, economic performance and trends, projections of results of specific activities or investments, expectations or beliefs about future events or results, and other statements that are not descriptions of historical facts, may be forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking information is inherently subject to risks and uncertainties, and actual results could differ materially from those currently anticipated due to a number of factors, which include, but are not limited to, risk factors discussed in the Company's Annual Report on Form 10-K and in other documents filed by the Company with the Securities and Exchange Commission from time to time. Forward-looking statements may be identified by terms such as "may", "will", "should", "could", "expects", "plans", "intends", "anticipates", "believes", "estimates", "predicts", "forecasts", "potential" or "continue," or similar terms or the negative of these terms, or other statements concerning opinions or judgments of the Company's management about future events. Factors that could influence the accuracy of such forward-looking statements include, but are not limited to pressures on the earnings, capital and liquidity of financial institutions in general, resulting from current and future conditions in the credit and equity markets, the financial success or changing strategies of the Company's customers, actions of government regulators, the level of market interest rates, weather and similar conditions, particularly the effect of hurricanes on the Company's banking and operations facilities and on the Company's customers and the communities in which it does business, changes in general economic conditions and the real estate values in our banking market (particularly changes that affect our loan portfolio, the abilities of our borrowers to repay their loans, and the values of loan collateral). Although the Company believes that the expectations reflected in the forward-looking statements are reasonable, it cannot guarantee future results, levels of activity, performance or achievements. All forward-looking statements attributable to the Company are expressly qualified in their entirety by the cautionary statements in this paragraph. The Company has no obligations, and does not intend to update these forward-looking statements. |
ECB Bancorp, Inc. Overview 3 ECB BANCORP, INC. NYSE Amex traded ECBE Headquarters Engelhard, NC Founded 1919 Market Cap $26,788,505 Branches 25 FTEs 250 Asset Size $916.3 million Deposits $491.4 million Loans $546.6 million Customers 19,456 Households in 13 counties As of 3/31/2012 |
Strategic Focus • Earnings Enhancement • Customer Engagement • Employee Engagement • Communication • Branding • Business Innovation • Market Development • Enterprise Risk Management Framework 4 ECB BANCORP, INC. |
ECB Highlights • Well capitalized • Financial Strength and Soundness • Pre-eminent Community Bank franchise in eastern North Carolina • Attractive growth markets in NC • Leadership Team • Aggressive multi-prong growth strategy - Organic - De novo - Lines of business 5 ECB BANCORP, INC. |
Key Accomplishments Within Last 24 Months – Commercial, Agri-business, Mortgages, Wealth Management 6 ECB BANCORP, INC. • • • • • • Enhanced Loan Loss Reserve Modeling Core Processing – reporting, technology, customer intelligence, new products Enterprise Risk Management Commitment to Growing Lines of Business Customer Care Center Development of ECB University |
Executive Leadership 7 ECB BANCORP, INC. Experienced Executive Management Team Executive Position Years in Banking A. Dwight Utz President & CEO 39 James J. Burson EVP, Chief Revenue Officer 28 Thomas M. Crowder EVP, Chief Financial Officer 33 T. Olin Davis EVP, Chief Credit Officer 33 M. Jeanne Mauney SVP, Chief Enterprise Risk Officer 28 Lorie Y. Runion EVP, Chief Administrative Officer 33 William S. Sampson EVP, Chief Information Officer 9 |
CAPITAL |
Capital 9 ECB BANCORP, INC. March 31, 2012 March 31, 2011 Capital Ratios Leverage 8.23% 8.42% Tier 1 Capital 12.39% 11.97% Total Risk – Based Capitol Ratio 13.65% 13.24% Tangible Equity/ Total Assets 6.95% 6.75% Equity/Assets 8.85% 8.64% |
Capital Tangible Book Equity 10 ECB BANCORP, INC. $22.88 $23.89 $23.62 $22.32 $22.11 $22.34 $21.00 $21.50 $22.00 $22.50 $23.00 $23.50 $24.00 2007 2008 2009 2010 2011 03/2012 |
FINANCIAL STRENGTH AND SOUNDNESS |
Deposit Portfolio Composition 12 ECB BANCORP, INC. Chart Key: Demand Non-Interest Demand Interest Savings Retail CDs < $100K CDs > $100K • Good migration to lower cost deposits • Reduced Jumbo CDs by 56.7% • Contracted retail CDs • Grew demand interest products Total Deposit $555.6 million Total Deposit $772.6 million 15.1% 17.5% 7.5% 24.1% 3.3% 18.0% 16.2% 34.9% 27.6% March 31, 2008 March 31, 2012 35.9% |
Cost of Deposits 13 ECB BANCORP, INC. 1.26% 1.17% 1.13% 0.99% 0.87% 0.00% 0.20% 0.40% 0.60% 0.80% 1.00% 1.20% 1.40% 1Q 2011 2Q 2011 3Q 2011 4Q 2011 1Q 2012 |
Loan Portfolio Composition 14 ECB BANCORP, INC. Chart Key: RE-Construction, Land Development & Other Land RE-Commercial, Residential Other** Commercial & Other Credit Cards & Related Plans Consumer **Includes Farmland • Stable year-end portfolio yield • 2009 = 5.30%; 2010 = 5.37%; 2011 = 5.36% • Our top ten loan relationships account for only 13% of the total portfolio in dollars • Variable rate loans account for approximately 59% of our loan portfolio • Average loan size: $79,985 Total Loans: $485.8 million Total Loans: $491.4 million 1.1% 23.5% 51.7% 23.2% 0.4% 13.6% 68.9% 16.0% 0.3% 1.2% March 31, 2012 March 31, 2008 |
Net Charge Offs/Average Loans 1.40% 1.11% 1.86% 1.89% 0.51% 0.00% 0.20% 0.40% 0.60% 0.80% 1.00% 1.20% 1.40% 1.60% 1.80% 2.00% 1Q 2011 2Q 2011 3Q 2011 4Q 2011 1Q 2012 |
Slow Pays 16 ECB BANCORP, INC. 3 YR Quarterly Migration for 30-60-90 Day Past Dues $1,222,806 $0 $500,000 $1,000,000 $1,500,000 $2,000,000 $2,500,000 $3,000,000 $3,500,000 $4,000,000 $4,500,000 $5,000,000 |
Financial Strength Overall Increase in Problem Assets – much lower than most other North Carolina banks NPAs/Total Loans Period: 2007 – 2011 17 ECB BANCORP, INC. 3.06% 0.00% 1.00% 2.00% 3.00% 4.00% 5.00% 6.00% 12/2007 12/2008 12/2009 12/2010 12/2011 ECB Bancorp, Inc. Peer Average |
GROWTH |
Update • In June 2011, ECB entered into a securities purchase agreement with certain institutional investors to issue $79.7 million in company common stock in a private placement offering. • In July 2011, we entered into an agreement with Bank of Hampton Roads to acquire deposits and selected assets associated with seven Gateway branches predominantly in the Raleigh-Durham/Chapel Hill, NC MSAs. • Earlier this year, ECB and the investors mutually terminated the securities purchase agreement since not all required regulatory approvals necessary to complete the transaction had been received as of the termination date. • Although there was an attempt to restructure an alternate transaction with the remaining investors, we were not able to reach an agreement of revised terms and conditions we deemed were in best interest of our Company and our shareholders. • The termination of the securities purchase agreement also resulted in termination of our branch acquisition agreement with Bank of Hampton Roads. 19 ECB BANCORP, INC. |
Historical Growth 20 ECB BANCORP, INC. $916.6 $772.6 $491.4 (in millions) $0 $100 $200 $300 $400 $500 $600 $700 $800 $900 $1,000 Gross Loans Deposits Total Assets |
Wealth Management • In first four months of 2012, we have doubled revenue related to in-bank referrals • Untapped potential with our client base • Focus is on building revenue streams rather than transaction focus • Attractive demographics especially in ECB’s coastal markets supporting future growth in wealth management Mortgage Banking • Demand remains high in core ECB markets • Mortgage fees increased 25% in the 1 st quarter of 2012 compared to the prior year period. • In process of expanding presence into additional markets including Raleigh, Fayetteville and Goldsboro • Beginning to portfolio selected high quality 5/1 ARM’s to augment existing loan book 21 ECB BANCORP, INC. |
Agricultural Banking • ECB now ranks 2 nd of all NC community Banks in Agricultural Banking • Goal is to be ranked #1 • Building our Agricultural Banking Team • Strong presence in four of thirteen eastern NC counties • Very successful part of ECB’s portfolio for past twelve years; 15% of ECB’s total loan portfolio 22 ECB BANCORP, INC. |
Attractive Market Area 23 ECB BANCORP, INC. Highlights Include: ECB has 25 locations located east of I-95 stretching from the VA to SC state lines Markets we serve offer diversity in that we have branches both coastal and inland; we serve rural and the MSAs of Greenville, Wilmington and OBX of NC Our intermediate target area may cover Richmond and portions of VA, and westward in NC to include Raleigh/Durham /Chapel Hill MSAs Likely near term de novo markets include Fayetteville, Jacksonville, Elizabeth City |
Future Direction • 25% growth in de novo growth of branches in next three to five years within our footprint • Expansion into other lines of business such as real estate, insurance, unbanked • Leveraging our Relationship Banking strategy to grow our customer base • Continue our focus on small business which has been ECB’s forte for over 90 years 24 ECB BANCORP, INC. |
QUESTIONS AND ANSWERS |