Form 8-K BANK OF THE JAMES FINANC For: Sep 06

 

 

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): September 6, 2016

 

 

BANK OF THE JAMES FINANCIAL GROUP, INC.

(Exact Name of Registrant as Specified in Its Charter)

 

 

 

Virginia		001-35402		20-0500300
(State or other jurisdiction of incorporation or organization)		(Commission File Number)		(I.R.S. Employer Identification No.)
828 Main Street, Lynchburg, VA				24504
(Address of principal executive offices)				(Zip Code)

(434) 846-2000

(Registrant’s telephone number, including area code)

 

 

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))

 

 

 

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Item 7.01 - Regulation FD Disclosure

The attached investor presentation contains information that members of the management of Bank of the James Financial Group, Inc. (the “Company”) will use from time to time, either all or in part, during visits with investors (including the investor conference referenced in Item 8.01 below), analysts, and other interested parties to assist such parties’ understanding of the Company. The investor presentation materials are available in the Investor Relations section of the Company’s website (www.bankofthejames.com).

The investor presentation materials are attached hereto as Exhibit 99.1 to this report. The investor presentation materials are being furnished, not filed, under Item 7.01 of this Form 8-K.

Item 8.01 - Other Events

On September 6, 2016, the Company issued a press release announcing that it will be presenting to investors at the Raymond James 2016 U.S. Bank Conference on September 7, 2016. The press release is attached hereto as Exhibit 99.2 to this report.

Item 9.01 - Financial Statements and Exhibits

 

(a)

Financial statements of businesses acquired – not applicable

 

(b)

Pro forma financial information – not applicable

 

(c)

Shell company transactions – not applicable

 

(d)

Exhibits

 

Exhibit No.		Exhibit Description
99.1		Investor Presentation Materials
99.2		Press Release Dated September 6, 2016

 

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SIGNATURE

In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

Date: September 6, 2016				BANK OF THE JAMES FINANCIAL GROUP, INC.
				By		/s/ J. Todd Scruggs
						J. Todd Scruggs
						Secretary-Treasurer

 

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EXHIBIT INDEX

 

Exhibit No.		Exhibit Description
99.1		Investor Presentation Materials
99.2		Press Release Dated September 6, 2016

 

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NASDAQ: BOTJ Exhibit 99.1

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FORWARD-LOOKING STATEMENTS This presentation contains statements that constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. The words "believe," "estimate," "expect," "intend," "anticipate," "plan" and similar expressions and variations thereof identify certain of such forward-looking statements which speak only as of the dates on which they were made. Bank of the James Financial Group, Inc. (the "Company") undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. You are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and that actual results may differ materially from those indicated in the forward-looking statements as a result of various factors. Such factors include, but are not limited to competition, general economic conditions, potential changes in interest rates, and changes in the value of real estate securing loans made by Bank of the James (the "Bank"), a subsidiary of Bank of the James Financial Group, Inc. Additional information concerning factors that could cause actual results to materially differ from those in the forward-looking statements is contained in the Company's filings with the Securities and Exchange Commission (“SEC”) available at the SEC’s Internet site (http://www.sec.gov).

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Listed on NASDAQ: BOTJ Market Capitalization: ~ $56.4 million(1) YTD Core EPS(2) – 6/30/2016 – $0.81 Key Balance Sheet Metrics at 06/30/2016: Assets - $546 million Loans - $461 million Deposits - $494 million Equity - $50.5 million Our Company Formed in 1999 by a group of experienced bankers, former bankers, and community leaders to fill a void for a locally-focused institution not acquired by a larger bank The Bank is a commercial banking franchise headquartered in Central Virginia; a region also referred to as “Region 2000” Operates thirteen banking centers and two mortgage offices in the Charlottesville, Harrisonburg, Lynchburg and Roanoke MSAs Strong Virginia Franchise Bank of the James’ mission is to be the pre-eminent financial institution in our markets through superior customer service. Key Details Source: SNL Financial LC; Based upon trading data as of end of business day 8/23/2016 YTD core EPS of the Company is annualized

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OUR MARKETS Highlights Headquartered in Lynchburg, VA Locally know as Region 2000 Affluent market with significant employers Recently Expanded into Charlottesville, Harrisonburg, and Roanoke Combined market area has a population of almost 1 million residents Market area boasts a stable economic environment Major industries include: Higher Education: (UVA, JMU, Liberty U., etc.) Healthcare: Centra Health System Power Generation: AREVA, Babcock & Wilcox Financial Services: Genworth Financial Lower cost of living, natural beauty, and high quality of life attracts retirees Source: SNL Financial LC; Microsoft MapPoint; Bank of the James Management; Region 2000 Partnership: Amherst, Appomattox, Bedford, and Campbell counties Banking Offices (14) Roanoke Lynchburg Charlottesville Amherst Altavista Bedford Waynesboro Staunton Harrisonburg Region 2000

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EXPERIENCED, YOUNG TEAM (1 of 2) Executive Headshot Previous Experience Age Years in Banking Years with BOTJ Robert Chapman President & CEO CEO, Bank of the James (2004) Co-founder, Bank of the James (1999) Current director First Lieutenant, US Army Virginia Military Institute Stonier Graduate School of Banking 54 32 17 Todd Scruggs EVP & CFO CFO, Bank of the James (1999) Co-founder, Bank of the James (1999) Current director Former FINRA licensed Rep., Crestar (1994-98) UVA McIntire School of Commerce USC Grad. School of Bank Inv. Mng. 48 17+ 17 Michael Syrek EVP & Chief Lending Officer Chief Lending Officer, Bank of the James (2011) Lynchburg President, SunTrust Bank SunTrust Commercial Team Leader Controller/CFO in various industries James Madison University 44 13 4 Chip Umberger EVP & Chief Credit Officer Chief Credit Officer, Bank of the James (2004) Manager, Sovran Bank (1990) Hamden-Sydney College VBA School of Bank Management 50 16 15

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Executive Headshot Previous Experience Age Years in Banking Years with BOTJ Angelia Johnson EVP & Retail Branch Administrator Retail Division Leader, Bank of the James (2008) Manager, Wachovia Bank (1995-2000) MBA, Averett University Stonier Graduate School of Banking 53 10+ 10 Brandon Farmer EVP & Chief Operations Officer EVP and Senior Operations Officer (2008) Intern, Bank of the James in Organization Virginia Polytechnic and State University Stonier Graduate School of Banking 37 17 17 Brian Cash President, Bank of the James Mortgage President, Bank of the James Mortgage Division (2006) Mortgage Consumer Loan Officer, Bank of the James (2004) Lynchburg College Stonier Graduate School of Banking 36 12 12 EXPERIENCED, YOUNG TEAM (2 of 2)

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Driving Shareholder Value with strong results $427M $493M Note: ROAE, ROAA and Earnings Per Share Per Share data as of June 30, 2016 YTD Annualized; Dividends Per Share Data is June 30, 2016 LTM Profitable Growth Strong loan growth has helped drive the increase in the Company’s return on equity Loan growth has come from Lynchburg as well as recent expansion into Charlottesville, Harrisonburg, and Roanoke The Company’s focus on improving fundamental performance has driven increased shareholder value The Company is focused on continuing to enhance shareholder value with the following goals: Growing loans by high single digit to low double-digit rates through prudent lending Targeting a double-digit ROAE Focusing on double-digit EPS growth 251.1% 2.25% 7.90% 425.3% 0.14% 0.63% 351.5% $0.18 $0.81 $0.18 $0.00 $11.21 44.0% $11.55 $8.02 $461M 42.1% $325M

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OPPORTUNITY For Continued STRONG ORGANIC GROWTH Highlights As the impact of the financial crisis waned in late 2011, the Company began to refocus on growth Hired Mike Syrek as CLO Developed expertise and platform to bank more sophisticated C&I relationships Hired additional talented bankers in Lynchburg Made key hires to expand into Charlottesville, Harrisonburg, and Roanoke The Company has positioned itself as the bank of choice Opportunity to hire the best banking talent in the region Customer service and reputation accelerate business development Recent market disruption from recent mergers and branch sales further increases the ability to capitalize on talent and clients dislocated by this process The Company’s market area provides an opportunity for significant continued organic growth While bigger banks have historically dominated these markets, they are focused elsewhere Significant opportunity to grow deposit market share – meaningful opportunity remains in Lynchburg Source: SNL Financial LC Note: Includes banks operating in Lynchburg, Charlottesville, Roanoke, and Harrisonburg Metropolitan Statistical Areas (MSAs); deposit market share data as of June 30, 2015

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ATTRACTIVE POTENTIAL FOR STRATEGIC GROWTH Highlights There are 16 banks with under $300MM in assets operating in our target market area Many of these companies are struggling to adjust to the new business and regulatory environment for community banks Many management teams are older and looking for an opportunity to retire We will evaluate merger opportunities based on shareholder-focused metrics We believe that the Company is an attractive acquirer for the following reasons Track record of strong fundamental performance Focus on shareholder value Reputation and capabilities Experienced and energetic management team Source: SNL Financial LC; Microsoft MapPoint Note: Map includes Lynchburg, Charlottesville, Roanoke, Staunton, Harrisonburg, and Blacksburg, Virginia Metropolitan Statistical Areas (MSAs) and Rockbridge County, VA Roanoke Lynchburg Charlottesville Staunton Harrisonburg Rockbridge County Blacksburg

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STRONG BALANCE SHEET GROWTH Recent Balance Sheet Performance

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Attractive Balance Sheet Mix Current Loan Portfolio Current Deposit Portfolio The Bank has a conservative loan book and is focused on profitable loan growth with manageable risk The Company has focused its recent efforts on expanding its C&I loan book The Company’s recent expansion into other markets will increase the geographic diversity in the Company’s portfolio The Bank has produced substantial loan growth in recent years The Bank has an attractive and stable core deposit base and intends to focus on a strong core deposit mix even with significant organic growth Close to 70% of the Bank’s deposits are non-time deposits The Company does not rely on wholesale deposits for funding purposes The Company’s MRQ cost of interest bearing liabilities was 0.53% for the quarter ended June 30, 2016

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ASSET QUALITY Low Nonperforming Assets (2) Loan loss reserve (“LLR”) to gross loans held for investment Excluding troubled debt restructurings Strong Loan Quality (1) 1.48% 1.41% 1.28% 1.20% 1.16% 1.09% 1.09% 1.07% 1.07% 1.06% 0.44% 0.92% 0.74% 0.82% 0.20% 0.22% 0.59% 0.06% - 0.02% 0.09% 0.33% 0.09% 0.14% 0.21% - 0.04% 0.07% 0.12% 0.10% -0.50 0.00 0.50 1.00 1.50 2012Q1 2012Q2 2012Q3 2012Q4 2013Q1 2013Q2 2013Q3 2013Q4 2014Q1 2014Q2 2014Q3 2014Q4 2015Q1 2015Q2 2015Q3 2015Q4 2016Q1 2016Q2 Loan Loss Reserves/ Gross Loans (%) Net Chargeoffs/ Avg Loans (%) 2.00 1.88% 1.75% 1.73% 1.70% 1.69% 1.62% 1.48% 1.49% 3.08 2.18 1.88 1.92 1.95 1.59 1.31 1.04 1.13 1.00 0.98 0.97 0.86 0.81 0.76 1.02 0.94 0.91 0.50 1.00 1.50 2.00 2.50 3.00 2012Q1 2012Q2 2012Q3 2012Q4 2013Q1 2013Q2 2013Q3 2013Q4 2014Q1 2014Q2 2014Q3 2014Q4 2015Q1 2015Q2 2015Q3 2015Q4 2016Q1 2016Q2 NPAs/ Assets (%) 3.50 0.00

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Strong, stable net interest margin Recent Net Interest Margin Performance

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STRONG FINANCIAL PERFORMANCE Efficiency Ratio ROAA and ROAE Noninterest Expense / AA Noninterest Income / Average Assets

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INVESTMENT CONSIDERATIONS Attractive Market Opportunity Affluent market area with steady growth opportunities Recent expansion into attractive Charlottesville, Harrisonburg, and Roanoke MSAs Big banks have lost focus on these markets Opportunity to attract dislocated customers and bankers Track Record of Strong, Disciplined Growth Experienced management team Strong, prudent loan growth from 2012 to present Robust margin, low cost of funds Attractive funding mix Healthy revenue stream with growing earnings Common equity raise to retire holding company notes and reduce interest expense Focus on Creating Shareholder Value Track record of creating shareholder value as illustrated by growth in tangible book value per share, earnings per share, dividends, and stock price Focus on achieving double-digit loan growth, EPS growth, and ROAE going forward. EPS decline in the first quarter of 2016 was due to slightly lower non-interest income for the Company, however, non-interest income has increased in 2016Q2. Earnings Per Share Growth Strong TBV Per Share Growth

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HISTORICAL FINANCIALS

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NASDAQ: BOTJ

Exhibit 99.2

 

 

BANK OF THE JAMES FINANCIAL GROUP, INC. TO PRESENT AT THE

RAYMOND JAMES 2016 U.S. BANK CONFERENCE

LYNCHBURG, VA, September 6, 2016 – Bank of the James Financial Group, Inc. (NASDAQ CM: BOTJ), the parent company of Bank of the James, a full-service commercial and retail bank serving the Greater Lynchburg MSA, commonly known as “Region 2000” and other markets in Central Virginia, will be presenting to investors at the Raymond James 2016 U.S. Bank Conference September 7, 2016 in Chicago, Illinois.

The company will be represented at the conference by Robert R. Chapman III, President and CEO, J. Todd Scruggs, EVP and Chief Financial Officer, Michael A. Syrek, EVP and Chief Lending Officer, and Harry P. Umberger, EVP and Chief Credit Officer.

Bank of the James Financial Group, Inc. posted record assets and loans at June 30, 2016, and also record second quarter earnings for the three months ended June 30, 2016. The company was ranked among the top 200 performing community banks and thrifts in the nation by American Banker magazine in May 2016. The Top 200 Ranking was based upon the three-year average Return on Equity for the years 2013-2015 and included banks and thrifts with less than $2 billion in total assets as of December 31, 2015.

A copy of the company’s investor presentation will be available on the bank’s website following the presentation.

About the Company

Bank of the James Financial Group, Inc. is a bank holding company with $545.73 million in total assets as of June 30, 2016 and trades on the NASDAQ Capital Market, LLC under the symbol “BOTJ”. Bank of the James, a wholly owned subsidiary of Bank of the James Financial Group, Inc. serves the greater Lynchburg, Virginia MSA, often referred to as Region 2000, and other markets including Charlottesville, Harrisonburg and Roanoke in Virginia. The bank operates ten full service locations, two limited service branches, two loan production offices, and an investment/insurance services division.

Contact: J. Todd Scruggs, EVP and Chief Financial Officer

[email protected]

(434) 455-7511

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