Exhibit 99.1
NORTHRIM BANCORP, INC.
NASDAQ: NRIM MAY 2014
FORWARD LOOKING STATEMENTS
This presentation may contain “forward-looking statements” as that term is defined for purposes of Section 21D of the Securities and Exchange Act. These statements are, in effect, management’s attempt to predict future events, and thus are subject to various risks and uncertainties. Readers should not place undue reliance on forward-looking statements, which reflect management’s views only as of the date hereof. All statements, other than statements of historical fact, regarding our financial position, business strategy and management’s plans and objectives for future operations are forward-looking statements. When used in this report, the words “anticipate,” “believe,” “estimate,” “expect,” and “intend” and words or phrases of similar meaning, as they relate to Northrim and its management are intended to help identify forward-looking statements. Although we believe that management’s expectations as reflected in forward-looking statements are reasonable, we cannot assure readers that those expectations will prove to be correct. Forward looking statements are subject to various risks and uncertainties that may cause our actual results may differ materially and adversely from our expectations as indicated in the forward-looking statements. These risks and uncertainties include: our ability to maintain strong asset quality and to maintain or expand our market share or net interest margins; our ability to implement our marketing and growth strategies; our expected cost savings, synergies, and other financial benefits from the recently completed merger of Northrim with Alaska Pacific might not be realized within the expected time frames and costs or difficulties relating to integration matters might be greater than expected; and our ability to execute our business plan. Further, actual results may be affected by our ability to compete on price and other factors with other financial institutions; customer acceptance of new products and services; the regulatory environment in which we operate; and general trends in the local, regional and national banking industry and economy as those factors relate to our cost of funds and return on assets. In addition, there are risks inherent in the banking industry relating to collectability of loans and changes in interest rates. Many of these risks, as well as other risks that may have a material adverse impact on our operations and business, are identified in the “Risk Factors” section of our Annual Report on Form 10-K for the fiscal year ended December 31, 2013, and from time to time are disclosed in our other filings with the SEC. However, you should be aware that these factors are not an exhaustive list, and you should not assume these are the only factors that may cause our actual results to differ from our expectations. These forward-looking statements are made only as of the date of this presentation, and Northrim does not undertake any obligation to release revisions to these forward-looking statements to reflect events or conditions after the date of this release.
NORTHRIM: SOLID VALUE
Price @ April 22, 2014 $24.89
Market Cap @ April 22, 2014 $163M
Net Interest Margin Q1 2014 4.28%
Tangible Book Value Q1 2014 $21.11
Price/Tangible Book 1.18x
EPS (ttm) $1.86
P/E Ratio 13.4x
Dividend Yield 2.73%
NORTHRIM: STRONG PERFORMANCE
Net Income
(000)
$4,500 $4,000 $3,500 $3,000 $2,500 $2,000 $1,500 $1,000 $500 $-
Q1 2014 net income $2.7 million
2013 income
$12.3 million
Q1-12
Q2
Q3
Q4
Q1-13
Q2
Q3
Q4
Q1-14
NORTHRIM HISTORY
Opened for
business; Invested in Invested in Invested in Acquired Invested in Acquired
original startup of Elliott Cove Northrim Alaska Elliott Cove Alaska
offering Residential Capital Benefits First Bank Insurance Pacific
$8.2 million Mortgage Management Group & Trust Company Bank
1990 1995 1998 1999 2002 2004 2005 2006 2007 2008 2011 2013 2014
First Acquired Established Invested Total assets Affiliate
Alaska eight Northrim in Pacific crossed the Northrim
bank to Bank of Funding Wealth $1 billion Benefits
launch a America Services Advisors mark Group
website branches established
Enroll Alaska
STRATEGIES FOR SUCCESS
Northrim’s original strategies, and our execution, continue to serve us well today
Strong balance sheet
Solid net interest margin
Focus on asset quality
Diversified income sources
Strategic Investments
Leadership to build Alaska’s economy
STRONG BALANCE SHEET: TOTAL CAPITAL RATIO
20.00%
17.01%
18.00%
15.24% 15.33% 16.46% 16.60% 16.61%
16.00%
14.00%
12.00%
10.00%
8.00%
6.00%
4.00%
2.00%
0.00%
Q4 2009 Q4 2010 Q4 2011 Q4 2012 Q4 2013 Q1 2014 NRIM Well Capitalized
NORTHRIM BANCORP, INC.: A HISTORY OF INCREASING SHAREHOLDER VALUE
3/31/2014 160,000,000 $145.9 million
Total Shareholders’ Equity 140,000,000
120,000,000 Capital Raises: 1990: $ 9.3 million 100,000,000 1992: $ 1.6 million 1993: $ 6.0 million 80,000,000 1999: $20.3 million
60,000,000
CAGR 13.62%
40,000,000
12/31/1990
$7.5 million
20,000,000
-
1990 1995 2000 2005 2010
COMPOSITION OF NORTHRIM BANCORP, INC. CAPITAL AS OF MARCH 31, 2014
$175 $150 $158 $125 $146 $100
(000) $75 $50
$25 $37
($8) $- $(25) ($41) $(50)
Total Capital Raised Cumulative Cumulative Repurchases, Total Equity Earnings Dividends Paid Equity Compensation, Costs of Capital Raises, and Other
CORE DEPOSITS
As of 03/31/14
YTD Average Cost of Deposits: 0.18%
CDs under $100,000, 4%
CDs over $100,000, 5%
Money Market, 20%
Demand, 36%
Interest-bearing demand, 14%
Alaska CD,
Savings, 10% 11%
LOAN PORTFOLIO YTD Average Yield on Loans: 5.70% As of 03/31/14
Non-owner Occupied CRE
38% Owner Occupied CRE
11%
Consumer 4%
Construction 8%
Commercial 39%
LOAN VOLUME
Portfolio Loans
$770,016 $763,065
$780,000
$760,000 $754,355
$740,000 $721,609
$718,157
$720,000
(000) $700,000
$680,000
$660,000
$644,258
$640,000
$620,000
$600,000
$580,000
Q1-12 Q1-13 Q2 Q3 Q4 Q1-14
FOCUS ON ASSET QUALITY: NONPERFORMING ASSETS
$16,000 $14,000 $12,000 $10,000 $8,000 $6,000 $4,000 $2,000 $0
(000)
1.25% 1.16% 0.94%
0.78% 0.77% 0.70% 0.56% 0.35%
0.37%
Q1-12 Q2 Q3 Q4 Q1-13 Q2 Q3 Q4 Q1-14
NPA NPA/Assets
HIGH NON INTEREST INCOME
Net Interest
Income
80%
Other Income
20%
Quarter ended 03/31/14
DIVERSIFIED OTHER OPERATING
INCOME YTD 03/31/14
18%
32%
16%
4%
-5%
17%
18%
Purchased Receivable Income Benefit Plan Income
Deposit Service Charges Electronic Banking Income Residential Mortgage Gain on Sale of Securities Other Income
AFFILIATES AND DIVERSIFICATION
CORPORATE STRUCTURE
Northrim BanCorp, Inc.
Northrim Bank
Northim Capital Trust 1
(“NCTI”)
Northrim Statutory Trust 2 (“NST2”)
Northrim Investment Services Company (“NISC”)
Northrim Capital Investments Co. (“SNCIC”) 100%
Northrim Funding Services A Division of Northrim Bank
Northrim Building, LLC 100%
Elliott Cove Insurance Agency LLC 43%
Northrim Benefits Group, LLC 50%
Residential Mortgage Holding Company, LLC 24%
Enroll Alaska A Division of Northrim Benefits Group, LLC
Residential Mortgage, LLC
Elliott Cove Capital Management LLC 43%
Pacific Wealth Advisors, LLC 23%
Pacific Portfolio Consulting, LLC
Pacific Portfolio Trust Comapany
OVERVIEW OF ALASKA PACIFIC BANCSHARES, INC. ACQUIRED BY NORTHRIM BANCORP, INC. APRIL 1, 2014
Overview
Headquarters: Juneau, Alaska
Branches: 5
Date Established: 1935
Balance Sheet (March 31, 2014)
Assets $167,839,000 Total Deposits $ 149,466,000
Portfolio loans $141,307,000 Preferred Equity/TARP $ 0(1)
Allowance for loan losses $ 1,905,000 Common Equity $ 14,733,000
Net Loans $139,402,000 Total Equity $ 14,733,000
YTD March 31, 2014 2013
ROAA(0.75%) 0.19%
ROAE NM 1.58%
Net interest margin 4.41% 4.59%
Efficiency ratio NM 89.25%
(1) TARP was repaid prior to March 31, 2014.
TRANSACTION OVERVIEW
Transaction Detail(1)
Aggregate Value • $ 14.6 million
Per Diluted Share Value • $ 17.57
Price / ATBVPS • 93%
Market Premium • 3%(2)
Core Deposit Premium • 0.5%
(1) Calculated based on Northrim’s 15-day weighted average close price of $25.66 as of March 25, 2014. Aggregate value includes $13.9 million in cash and stock paid by Northrim and $717,000 in proceeds from the exercise of TARP warrants.
(2) Premium of aggregate deal value per diluted share over Alaska Pacific Bancshares, Inc. final close price of $17.11. The Market Premium using the close price of Alaska Pacific Bancshares, Inc. shares on October 21, 2013, the date that the deal was announced, was 44%.
PRO FORMA FINANCIAL IMPACT
Year 1 EPS Accretion (1) •9%
Year 2 EPS Accretion •9%
IRR • > 15%
Tangible Book Value Dilution Payback • There is no Tangible Book Value Dilution
Capital Ratios (3/31/2014)
Northrim Alaska Pacific Pro Forma
BanCorp, Inc. Bancshares, Inc.
Leverage Ratio 13.42% 8.75% 12.33%
Tier 1 Ratio 15.75% 10.93% 14.36%
Total Risk-Based Capital Ratio 17.01% 12.18% 15.45%
(1) Year 1 is defined as 2014, year 2 is 2015; excludes impact of transaction costs as they are factored into tangible book value dilution. Also excludes the impact of the estimated bargain purchase gain.
MARKET DATA (DEPOSIT DATA AS OF JUNE 30, 2013 FROM FDIC DEPOSIT MARKET SHARE REPORT)
Total Assets ($ millions)
Institution: Alaska Banks June 30, 2013
Wells Fargo Bank, NA AK data not available
First National Bank Alaska 2,940,495
Proforma(1) 1,334,575
Northrim Bank 1,158,281
KeyBank, NA AK data not available
First Bank of Ketchikan 447,636
Mt. McKinley Bank 325,878
Denali State Bank 254,387
Alaska Pacific Bank 176,294
Deposits
Institution Branches ($ millions) Share
Wells Fargo Bank, NA 51 5,301,829 52.35%
First National Bank Alaska 30 1,981,250 19.56%
Proforma (1) 15 1,124,983 11.10%
Northrim Bank 10 969,611 9.57%
KeyBank, NA 17 836,089 8.26%
First Bank of Ketchikan 9 398,004 3.93%
Mt. McKinley Bank 5 256,494 2.53%
Denali State Bank 5 228,177 2.25%
Alaska Pacific Bank 5 155,372 1.53%
(1)Exclusive of any acquisition adjustments.
NORTHRIM’S ALASKA FOOTPRINT, POST ACQUISITION
100%
907
Trans-Alaska Pipeline System
Town
Northrim Locations
Future Northrim Locations
Alaska Native Regional Corporation Regions
Alaska Railroad
SOUTHEAST ALASKA
Photo courtesy of Joe Beedle: Juneau, Alaska Marine Highway
SOUTHEAST ALASKA
Southeast Alaska- Photo courtesy of Joe Beedle:
John O’Connell Bridge and Mount
Based Banking Edgecumbe, Sitka Alaska
Company
Founded in 1935
Population in Southeast Alaska reached a new record of 74,423 in 2012 and between 2010 and 2012 was the fastest-growing region of the state with a population gain of 2,800.
The regional labor force increased by 1,800 and total labor force reached 46,000.
The 2013 salmon season has turned out to be the best ever for Southeast Alaska in terms of harvests.
Tourism has increased after recession-caused dips in 2010-2011.
And while there were some job losses in government and retail in Juneau, total wages remained up.
Mining is doing well, with the Kensington gold mine on Berner’s Bay producing at expected levels and output up sharply at the Greens Creek multi-metals mine on northern Admiralty Island, both near Juneau.
Creates a significant community banking presence for Northrim in
Southeast Alaska
SOUTHEAST ALASKA
Financially Attractive
Opportunities for Additional Growth
Penetration into a diverse market
New product offerings and higher lending limits to existing Alaska Pacific customers
Affiliates opportunities
Opportunity for significant operational efficiencies and cost synergies
Accretive to earnings in year one(1)
No tangible book value dilution
Strong IRR (>15%)
(1) Excludes impact of transaction costs as they are factored into tangible book value dilution Photo courtesy of Joe Beedle
ALASKA’S RESOURCE-BASED ECONOMY
All Other 34%
Federal 35%
Petroleum
Source: Alaska Institute of Social 31%
and Economic Research, 2010
LEADERSHIP TO BUILD ALASKA’S
ECONOMY
Join the conversation at ALASKANOMICS.COM
Northrim’s Economic Overview Is Now Available
Northrim Bank
MISSION
TO BE ALASKA’S MOST TRUSTED FINANCIAL INSTITUTION
We are committed to adding value for our customers, communities, and shareholders.
VISION
TO BE ALASKA’S PREMIER BANK AND EMPLOYER OF CHOICE
We will be a leader in financial expertise, products and services, focused on continuous improvement and market growth.
VALUES
PROUD TO BE ALASKAN
We are Alaskan managed. We embody Alaska’s frontier spiril and values, and strongly support our communities.
SUPERIOR CUSTOMER FIRST SERVICE
We have a sincere appreciation for our customers. We want to build lasting customer relationships through professional, prompt, and caring service.
GROWTH
We look for growth opportunities for our customers, our institution and our employees. We strive to be better, personally and professionally.
INTEGRITY
We are trustworthy, reliable, and ethical, and provide our customers with secure, confidential services. We do what is right.
WE ARE
ENGAGED
We achieve more because we are dynamic, proactive, and innovative.
ACCOUNTABLE
We take personal responsibility. We do what we say we will do.
ALIGNED
We value alignment within teams and across departments. Together we are stronger.
QUESTIONS?
