Exhibit 99.1
BCSB BANCORP
BCSB Bancorp
(Holding Company for Baltimore County Savings Bank)
June 2008
Forward–Looking Statements
BCSB BANCORP
This presentation may contain projections and other “forward-looking statements” within the meaning of the federal securities laws. These statements are not historical facts, rather statements based on the current expectations of BCSB Bancorp, Inc. (the “Company”) regarding its business strategies, intended results and future performance. Forward–looking statements are preceded by terms such as “expects,” “believes,” “anticipates,” “intends” and similar expressions.
Management’s ability to predict results or the effect of future plans or strategies is inherently uncertain. Factors that could affect actual results include interest rate trends, the general economic climate in the market area in which the Company operates, as well as nationwide, the Company’s ability to control costs and expenses, competitive products and pricing, loan delinquency rates, changes in federal and state legislation and regulation and other factors that may be described in the Company’s filings with the Securities and Exchange Commission, including the Annual Report on Form 10–K and other required filings. These factors should be considered in evaluating the forward–looking statements and undue reliance should not be placed on such statements. The Company assumes no obligation to update any forward-looking statements.
This presentation is for informational purposes only and does not constitute an offer to sell shares of common stock of BCSB Bancorp, Inc.
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Company Overview
BCSB BANCORP
Overview
Company: BCSB Bancorp, Inc.
Shares Outstanding: 3,121,000
Listing/Ticker: NASDAQ/BCSB
Stockholders’ Equity: $50.1mm
Tangible Stockholders’ Equity: $47.7mm
Book Value Per Share: $16.06
Tangible Book Value Per Share: $15.27
Price / Book Value ¹ 66.62%
Price / Tangible Book Value ¹ 70.07%
Note:
¹ Financial data as of June 30, 2008 3
Company Overview
BCSB BANCORP
MANAGEMENT TEAM
President – Joe Bouffard
Started at BCSB December 2006
Past President The Patapsco Bank 1995-2006
Past President Municipal Savings Bank 1985-1990
Chief Financial Officer – Tony Cole
Started at BCSB September 2007
Past CFO Bay Net Community Bank 2000-2007
Past CFO Atlantic Federal Savings Bank 1988-1996
Chief Operations Officer – Dave Meadows
Assumed Position January 2007
Started at BCSB January 1999
Formerly Interim President and Bank Counsel
Chief Lending Officer – Dan Wernecke
Started at BCSB June 2002
Assumed Position November 2007
Past EVP Sparks State Bank
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Company Overview
BCSB BANCORP
History of Baltimore County Savings Bank & BCSB Bancorp, Inc.
Founded in 1955
MHC conversion in 1998,
The company implemented an aggressive growth plan
18 branches throughout the Baltimore area. Most of this was through de novo branches
December 2005, the bank entered into a supervisory agreement with the Office of Thrift Supervision (OTS) June 2006, the bank was the victim of a check kiting scheme perpetrated by a single commercial deposit customer incurred a $6.9mm after tax loss later recovered $2.2mm after tax as part of a insurance claim July 2006, Bank’s former president resigned December 2006, new Bank president (Joe Bouffard) retained March 2007, Balance Sheet Restructuring September 2007, new CFO (Tony Cole) retained March 2008, OTS Supervisory Agreement rescinded April 2008, Second Step Conversion completed July 2008 – Company announced third consecutive quarter of profitability
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Company Overview
BCSB BANCORP
BCSB Bancorp, Inc.
$598,000,000 in Assets¹
$510,000,000 in Deposits¹
4th Largest Publicly Traded Baltimore Financial Institution
Strong Asset Quality
Limited Intangible Assets (Goodwill)
Entire Branch Network within the Baltimore MSA
Note:
¹ Data as of June 30, 2008 6
Company Overview
BCSB BANCORP
Branch Map
BCSB
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Company Overview
BCSB BANCORP
Loan Composition¹
Cmmrcl RE
31%
Construction
9%
Cmmrl Lines of Cred
& Leases
3%
Single-Fam Rental
Prop.
10%
Home Equity Lines
4%
Automobile Lns
4%
Other
1%
Single-Fam
Residentials
38%
Note:
¹ Data as of June 30, 2008 8
Company Overview
BCSB BANCORP
Deposit Composition¹
Savings Accounts
16%
Checking Accounts
12%
Time Deposits
65%
Money Market
Accounts
7%
Note:
¹ Data as of June 30, 2008 9
Overview of BCSB Financial Data
BCSB BANCORP
Latest Quarterly Results
(Dollars in thousands)
Consol. Stmt. of Operations Qtr. Ended 09/30/07
Consol. Stmt. of Operations Qtr. Ended 12/31/07
Consol. Stmt. of Operations Qtr. Ended 03/31/08
Consol. Stmt. of Operations Qtr. Ended 06/30/08
Interest Income $9,252 $9,262 $8,602 $8,254
Interest Expense 5,632 5,600 5,239 4,565
Net Interest Income 3,620 3,662 3,363 3,689
Non-Interest Income 497 465 429 540
Non-Interest Expense 4,644 4,097 3,726 3,810
Income (Loss) Before Taxes (527) 30 66 419
Income Tax Expense (Benefit) (221) (63) 11 134
Net Income (Loss) ($306) $93 $55 $285
Basic and Diluted Earnings (Loss) Per Share ($0.06) $0.02 $0.02 $0.09
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Overview of Asset Quality
BCSB BANCORP
(Dollars in thousands) June 30, 2007 June 30, 2008
Total non-performing loans $2,783 $1,662
Percentage of total loans 0.68% 0.41%
Percentage of total assets 0.43% 0.28%
Allowance for loan losses as a percentage of non-performing loans 97.23% 160.95%
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Second Step Conversion
BCSB BANCORP
Completed in April of 2008
Consolidated equity to asset ratio increased to 8.38%
Strengthen Company’s and Bank’s Balance
Sheets Paid down $6,000,000 in trust preferred securities
Note:
Data as of June 30, 2008
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Supervisory Agreement Lifted in March 2008
BCSB BANCORP
Address Supervisory Agreement (SA) with the OTS
In effect since December 2005
- Bank Secrecy Act compliance
- Lack of viable business plan
- Flood certification
- Indirect auto lending approval process and underwriting
OTS exam completed in January 2008
SA terminated by OTS in March 2008
Lifting of SA resulted in:
Good publicity
Positive impact on deposit costs
FDIC premium reduction
Reduction in OTS assessment
Reduced regulatory reporting burden
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Initiatives To Improve Earnings
BCSB BANCORP
Expense Reduction
Sheshunoff Review
Comprehensive efficiency study of the entire organization
Completed in April 2008 / Recommendations are being implemented
Assessment of branch network
Comprehensive review of branch network
Still in process of evaluating most profitable branch composition
Reduce Trust Preferred Securities
Pay down of $6,000,000 on June 30, 2008
Reduces annualized interest expense by approximately $380,000
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Initiatives To Improve Earnings
BCSB BANCORP
Earnings Enhancement
Balance Sheet Restructuring
Sold $169mm investments yielding 3.51%
Pre-paid $73mm in FHLB Advances with an average cost of 4.97%
Sold $31.9mm in Adjustable Rate Fixed Income Mutual Funds
Sold $46.4mm in Fixed-rate Single Family Loans with a weighted average yield of 5.11%
Benefits of Balance Sheet Restructuring
Increased Margin
Significant Net Income Improvement
Improved capital ratios
Decrease Reliance On Borrowings and CD Funding
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Initiatives To Improve Earnings
BCSB BANCORP
Earnings Enhancement
Commercial Lending
De-emphasize residential lending
Exit indirect auto lending business
- $ 35.0 million reduction in indirect auto
- $ 11.7 million balance remaining
Hire more experienced commercial lenders
- Both CRE and C&I
- Good loans, industry contacts, fit the company
Source of commercial deposits
- Lower cost
- Utilize the branch network
- Utilize technology upgrades
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Initiatives To Improve Earnings
BCSB BANCORP
Fee Income Initiatives
Overdraft Privilege
Implemented in May 2007
Reverse Mortgage
Implemented in September 2007
Outsourced Processing through local Mortgage Broker
Public relations as well as fee income initiative
Non Insured Product Sales
Implemented in January 2008
Sale of Annuities, Mutual funds, etc.
Training just beginning
Outsource Origination and Sale of Residential Mortgages
Expense reduction
Fee income from sale of mortgages
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Initiatives To Improve Earnings
BCSB BANCORP
Other Revenue Enhancements
Reduce dependence on CDs
Large portion of CD’s mature in less than 1 year
Emphasizing Transaction and Money market accounts
- Looking to bring on commercial deposit relationships with commercial loans
- Introducing a new suite of business deposit products
More cost effective CD funding strategies
Implemented new service fee structure
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Transforming the Franchise – Summary Page
BCSB BANCORP
New Management
Experienced
Proven
Enthusiastic
Mandates
Raise additional capital
End Supervisory Agreement
Enhance Earnings
Time frames
1st period over-the last quarter as a MHC
2nd period began in April 2008 and ends in three years when OTS takeover prohibition ends
3rd period is the rest of BCSB’s corporate life and is dependent upon its performance
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