Form 8-K 1ST SOURCE CORP For: Jul 29
UNITED STATES | ||
SECURITIES AND EXCHANGE COMMISSION | ||
Washington, D.C. 20549 | ||
FORM 8-K | ||
CURRENT REPORT | ||
PURSUANT TO SECTION 13 OR 15(d) OF | ||
THE SECURITIES EXCHANGE ACT OF 1934 | ||
Date of Report (Date of earliest event reported): July 29, 2016 | ||
1st Source Corporation | ||
(Exact name of registrant as specified in its charter) | ||
Indiana | 0-6233 | 35-1068133 |
(State or other jurisdiction of incorporation) | (Commission File No.) | (I.R.S. Employer Identification No.) |
100 North Michigan Street, South Bend, Indiana 46601 | ||
(Address of principal executive offices) (Zip Code) | ||
574-235-2000 | ||
(Registrant's telephone number, including area code) | ||
Not Applicable | ||
(Former name or former address, if changed since last report) | ||
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions: | ||
[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | ||
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | ||
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | ||
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
ITEM 7.01 Regulation FD Disclosure.
The executive officers of 1st Source Corporation intend to use the material filed herewith, in whole or in part, in one or more meetings with investors and analysts. A copy of the investor presentation is attached hereto as Exhibit 99.1.
1st Source Corporation does not intend for this Item 7.01 or Exhibit 99.1 to be treated as "filed" for purposes of the Securities Exchange Act of 1934, as amended, or incorporated into its filings under the Securities Act of 1933, as amended.
ITEM 9.01 Financial Statements and Exhibits.
The following exhibit shall not be deemed as "filed" for purposes of the Securities Exchange Act of 1934, as amended.
(d) Exhibit:
99.1 1st Source Corporation Investor Presentation
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
1st SOURCE CORPORATION | ||
(Registrant) | ||
Date: July 29, 2016 | /s/ CHRISTOPHER J. MURPHY III | |
Christopher J. Murphy III | ||
Chairman of the Board and CEO | ||
Date: July 29, 2016 | /s/ ANDREA G. SHORT | |
Andrea G. Short | ||
Treasurer and Chief Financial Officer | ||
Principal Accounting Officer |
INVESTOR PRESENTATION
Symbol: SRCE
www.1stsource.com
FORWARD-LOOKING STATEMENT DISCLOSURE
PAGE 2
Except for historical information, the matters discussed may include “forward-looking
statements.” Generally, words such as “believe,” “possible,” “expect,” “intend,” “estimate,”
“anticipate,” “project,” “will,” “contemplate,” “seek,” “plan,” “assume,” “targeted,”
“continue,” “remain,” “should,” “indicate,” “would,” “may” indicate forward-looking
statements. Those statements are subject to material risks and uncertainties. 1st Source
cautions readers not to place undue reliance on any forward-looking statements, which speak
only as of the date made. 1st Source may make other written or oral forward-looking
statements from time to time. The audience is advised that various important factors could
cause 1st Source’s actual results or circumstances for future periods to differ materially from
those anticipated or projected in such forward-looking statements. Such factors, among
others, include changes in laws, regulations or accounting principles generally accepted in
the United States; 1st Source’s competitive position within its markets served; increasing
consolidation within the banking industry; unforeseen changes in interest rates; unforeseen
downturns in the local, regional or national economies or in the industries in which 1st Source
has credit concentrations; and other risks discussed in 1st Source’s filings with the Securities
and Exchange Commission, including its Annual Report on Form 10-K, which filings are
available from the SEC. 1st Source undertakes no obligation to publicly update or revise any
forward-looking statements.
Non-GAAP Financial Measures
In addition to the results presented in accordance with generally accepted accounting
principles in the United States of America, this presentation contains certain non-GAAP
financial measures. 1st Source Corporation believes that providing non-GAAP financial
measures provides investors with information useful to understanding our financial
performance.
CORPORATE OVERVIEW
$5.4 billion Community Bank with International Reach
headquartered in South Bend, Indiana
Community Banking:
■ Locations throughout Northern Indiana and Southwestern Michigan
■ Personal and business banking, payment services, lending,
mortgage, and leasing
■ Investment management, trust and estate planning, and retirement
planning services
■ Business and consumer insurance sales
Specialty Finance:
■ National and international footprint
■ Construction machinery
■ Corporate and personal aircraft
■ Auto rental and leasing, shuttle buses, charter buses, and funeral
cars
■ Truck rental and leasing
PAGE 3
MARKET AREA
Specialty Finance
Loans: $2.2 billion
Community Bank
Loans: $2.1 billion
As of June 30, 2016
PAGE 4
BUSINESS MIX (LOANS AND LEASES)
Personal
Community Banking 30%
Business
Community Banking 70%
Specialty Finance 50%
50%
As of June 30, 2016
PAGE 5
COMMUNITY BANKING
■ 80 Banking Centers
■ 102 Twenty-four hour ATMs
■ 10 1st Source Insurance offices
■ 8 Trust & Wealth Management locations with
approximately $4 billion of assets under management
In person Online Over the phone Mobile
PAGE 6
COMMUNITY BANKING MARKET AREA
17 – County Market
Market
Households
794,417
Client Households 100,978
Penetration 12.7%
Businesses (approx) 74,600
Business Clients 14,761
Penetration 19.8%
As of December 31, 2015
Higher Education Steel Production
Regional Medical Hub Medical Devices
Agriculture Distribution Hub Recreational Vehicle
Manufacturing
PAGE 7
SPECIALTY FINANCE GROUP SERVICES
Aircraft Division— $823MM
Aircraft division provides financing primarily for new and used
general aviation aircraft (including helicopters) for private and
corporate users, some for aircraft distributors and dealers, air charter
operators, air cargo carriers, and other aircraft operators. See
Appendix for NAICS industry detail.
Auto and Light Truck Division — $458MM
Auto/light truck division provides financing for automobile rental and
leasing companies, light truck rental and leasing companies, and
special purpose vehicle users: shuttle buses, charter buses, funeral
cars, etc.
Construction Equipment Division— $484MM
Construction equipment division provides financing for infrastructure
projects (i.e., asphalt and concrete plants, bulldozers, excavators,
cranes, and loaders, etc.)
Medium and Heavy Duty Truck Division — $274MM
The medium and heavy duty truck division finances highway tractors
and trailers and delivery trucks for the commercial trucking industry
and trash and recycling equipment for municipalities and private
businesses as well as equipment for landfills
As of June 30, 2016
PAGE 8
EXPERIENCED AND PROVEN TEAM
Executive Team
■ 6 executives with an average 37 years each of banking
experience and 24 years with 1st Source
Business Banking Officers
■ 37 business banking officers with an average 21 years
each of lending experience and 11 years with 1st Source
Specialty Finance Group Officers
■ 26 specialty finance officers with an average 28 years
each of lending experience and 12 years with 1st Source
PAGE 9
PAGE ELEVEN
PERFORMANCE – CLIENT
■ #1 deposit share in our 15
contiguous county market
■ #1 SBA Lender in every
county where located
■ #2 SBA Lender in State of
Indiana
■ Best Branch Service in the
Midwest – MSR Group
■ Indiana SBA Community Lender
Award – 2013 - 2015
■ Michiana’s Best Bank for Business –
Northwest Indiana Business
Quarterly
■ Michiana’s Best Company to
Work For – Northwest Indiana
Business Quarterly
■ Michiana’s Best Bank for
Customer Service – Northwest
Indiana Business Quarterly
■ One of the Highest Customer
Advocacy Scores among banks
in Midwest – APECS, 2015
PAGE 10
FINANCIAL REVIEW
PAGE 11
DIVERSIFIED & GROWING LOAN PORTFOLIO
3079
3209
3434
3640
3837
4057
5.33
5.02
4.69
4.42 4.39 4.30
1.00%
2.00%
3.00%
4.00%
5.00%
6.00%
7.00%
8.00%
9.00%
10.00%
0
500
1000
1500
2000
2500
3000
3500
4000
4500
5000
2011 2012 2013 2014 2015 2016
YTD
Loans & Leases Yield on Loans & Leases (%)
Total Average Loans & Leases ($MM)
Average Loans
By Type (6/30/16)
PAGE 12
STRONG CREDIT QUALITY
PAGE 13
2.64%
2.50%
2.35% 2.31%
2.21% 2.20%
2011 2012 2013 2014 2015 2016
% of Net Loans and Leases
Loan & Lease Loss Reserve Nonperforming Assets Net Charge-Offs / (Recoveries)
Stable Reserves
2.28%
1.25% 1.29%
1.13%
0.50% 0.49%
2011 2012 2013 2014 2015 2016
Improving Credit Quality
0.27%
0.13%
0.02% 0.06%
(0.02%) (0.02%)
2011 2012 2013 2014 2015 2016
Limited Losses
YTD YTD YTD
ATTRACTIVE CORE DEPOSIT FRANCHISE
3555 3574
3701 3778
3961
4227
0.87
0.61
0.45
0.30 0.29
0.36
0.00%
0.20%
0.40%
0.60%
0.80%
1.00%
1.20%
1.40%
1.60%
1.80%
0
500
1000
1500
2000
2500
3000
3500
4000
4500
5000
2011 2012 2013 2014 2015 2016
Deposits Effective Rate on Interest-
bearing Deposits (%)
Total Average Deposits ($MM)
Average Deposits
By Type (YTD 6/30/16)
PAGE 14
YTD
DEPOSIT MARKET SHARE – 15 COUNTY CONTIGUOUS MARKET*
$1,000,000
$1,500,000
$2,000,000
$2,500,000
$3,000,000
$3,500,000
$4,000,000
$4,500,000
June 09 June 10 June 11 June 12 June 13 June 14 June 15
1st Source
Chase
Lake City Bank
Wells Fargo
Fifth Third
PNC
*Includes Allen, Elkhart, Fulton, Huntington, Kosciusko, LaPorte, Marshall, Porter, Pulaski, St. Joseph, Starke,
Wells, and Whitley counties in the State of Indiana, and Berrien and Cass counties in the State of Michigan.
2015
13.66%
9.59%
8.67%
8.04%
5.22%
5.21%
Data as of June 2015 – FDIC
(via SNL Financial)
Leading Market Share in Community Banking Markets ($000)
PAGE 15
48.20 49.63
54.96
58.07 57.49
29.14 28.30
1.78 1.83
2.03
2.17 2.17
1.10 1.08
$0.00
$0.50
$1.00
$1.50
$2.00
$2.50
$3.00
$3.50
$4.00
$0
$10
$20
$30
$40
$50
$60
$70
2011 2012 2013 2014 2015 2015
YTD
2016
YTD
Net Income EPCS (Diluted)
($MM)
NET INCOME & EARNINGS PER SHARE*
* Note: EPS adjusted for 10% stock dividend declared July 22, 2015 and issued on August 14, 2015.
PAGE 16
150.9 153.8
158.6 162.2
168.2
81.9 84.5
3.69 3.69 3.67 3.59 3.60 3.61 3.45
0.00%
1.40%
2.80%
4.20%
5.60%
7.00%
$0
$44
$88
$132
$176
$220
2011 2012 2013 2014 2015 2015
YTD
2016
YTD
Net Interest Income ($MM) Net Interest Margin (%)
($MM)
NET INTEREST MARGIN (FTE)
PAGE 17
DIVERSE SOURCES OF NONINTEREST INCOME
Noninterest Income Composition
PAGE 18
* Note: Equipment rental income is shown net of leased equipment depreciation.
OPERATING EXPENSES
PAGE 19
133.7 136.3 136.3 136.1
140.8
67.8 70.2
64.4 63.3 62.4 60.6 60.9 59.9 60.5
0.0%
25.0%
50.0%
75.0%
100.0%
$0.0
$40.0
$80.0
$120.0
$160.0
2011 2012 2013 2014 2015 2015
YTD
2016
YTD
Noninterest Expense ($MM)* Efficiency (%)
($MM)
* Note: Noninterest expense is shown net of leased equipment depreciation.
16.51%
15.57% 15.86% 15.89% 14.97% 14.73%
2011 2012 2013 2014 2015 2016 YTD
15.21%
14.26% 14.54% 14.57% 13.65% 13.41%
2011 2012 2013 2014 2015 2016 YTD
11.72% 11.47% 12.08% 12.16% 12.21% 11.99%
2011 2012 2013 2014 2015 2016 YTD
STRONG CAPITAL POSITION
PAGE 20
Total Risk Based Capital Ratio
Tier 1 Leverage Ratio Tier 1 Risk Based Ratio
Tangible Common Equity / Tangible Assets
10% Well
Capitalized
5% Well
Capitalized
8% Well
Capitalized
10.18% 10.56% 10.76%
11.15% 10.96% 10.90%
2011 2012 2013 2014 2015 2016 YTD
$14.15
$14.95
$16.38
$17.67
$18.65
$20.16
$21.49
$22.32
$10.00
$13.50
$17.00
$20.50
$24.00
$27.50
2009 2010 2011 2012 2013 2014 2015 2016
YTD
TANGIBLE BOOK VALUE PER COMMON SHARE*
Consistent Growth
* Note: Adjusted for 10% stock dividend declared July 22, 2015 and issued on August 14, 2015.
PAGE 21
0.482
0.509 0.527
0.536 0.555
0.582 0.600
0.618
0.645
0.671
0.540
$0.000
$0.100
$0.200
$0.300
$0.400
$0.500
$0.600
$0.700
$0.800
$0.900
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
YTD
COMMON DIVIDENDS PER SHARE*
28 YEARS OF CONSECUTIVE DIVIDEND GROWTH
* Note: Adjusted for 10% stock dividend declared July 22, 2015 and issued on August 14, 2015.
PAGE 22
DELIVERING RETURNS TO SHAREHOLDERS
PAGE 23
DELIVERING RETURNS TO SHAREHOLDERS
PAGE 24
PERFORMANCE – FINANCIAL
■ #10 of 102 banks between $5 billion and $50 billion
in assets – Bank Performance Scorecard by Bank
Director Magazine
■ Top 15th Percentile of Community Banks – Seifried
& Brew
■ 5 Star “Superior” Rating – Bauer Financial
■ 28 years of consecutive
dividend growth
PAGE 25
INVESTMENT CONSIDERATIONS
■ Consistent and superior financial performance with a
focus on long-term earnings per share and tangible
book value growth
■ Experienced and proven team with significant
investment in bank
■ Diversification of product mix and geography with asset
generation capability
■ Leading market share in community banking markets
■ Stable credit quality, strongly reserved
■ Strong capital position and 28 consecutive years of
dividend growth
■ Balance Sheet is asset sensitive – positioned for rising
rates over time
PAGE 26
CONTACT INFORMATION
Christopher J. Murphy III
Chairman of the Board and CEO
(574) 235-2711
[email protected]
Andrea G. Short
CFO and Treasurer
(574) 235-2348
[email protected]
PAGE 27
APPENDIX
PAGE 28
MISSION AND VISION
Mission
To help our clients achieve security, build wealth and realize their
dreams by offering straight talk, sound advice and keeping their
best interests in mind for the long-term.
Vision
■ Offer our clients the highest-quality service
■ Support a proud family of colleagues who personify the 1st
Source spirit of partnership
■ Be the financial institution of choice
in each market we serve
■ Remain independent and nurture pride of
ownership among all 1st Source colleagues
■ Achieve long-term, superior financial results
PAGE 29
Ownership Summary
Shareholder Type Shares % of Total
Institutional 9,670,815 37.4%
Insiders 9,036,279 35.0%
Retail/Other 5,762,294 22.3%
1st Source ESOP 1,379,869 5.3%
Total Shares Outstanding 25,849,257 100.0%
Rank Institution (Top 10 Institutions) Shares % of Total
1 Dimensional Fund Advisors LP 2,243,201 8.7%
2 BlackRock Inc. 917,151 3.5%
3 Vanguard Group Inc. 830,974 3.2%
4 Manulife Asset Mgmt. (US) LLP 594,400 2.3%
5 AllianceBerstein L.P. 482,926 1.9%
6 Wellington Mgmt. Co. LLP 335,659 1.3%
7 State Street Corp. 272,096 1.1%
8 J.P. Morgan Alternative Asset Mgmt. Inc. 261,528 1.0%
9 FMR LLC 254,160 1.0%
10 Northern Trust Global Investments 215,193 0.8%
Top 10 Institutions 6,407,288 24.8%
Other 3,263,527 12.6%
Total Institutional Ownership 9,670,815 37.4%
Source: SNL Financial and Company filings
PAGE 30
Aircraft Portfolio – Industries by NAICS
As of June 30, 2016
PAGE 31
*Other includes: Mining & Utilities, Information, & Public Administration
Serious News for Serious Traders! Try StreetInsider.com Premium Free!
You May Also Be Interested In
- Partners Value Investments L.P. Announces 2023 Annual Results
- Hotel Villa Fontaine Premier/Grand Haneda Airport Offers Rooms Featuring JAL, Hatsune Miku, Love Live! Nijigasaki High School Idol Club, Other Popular Content
- Junshi Biosciences Announces 2023 Full Year Financial Results and Provides Corporate Updates
Create E-mail Alert Related Categories
SEC FilingsSign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!