EX-99.1 3 d811195dex991.htm EX-99.1 EX-99.1
Acquisition of Integrity Bancshares, Inc.
October 30, 2014
Exhibit 99.1

Caution About Forward-Looking Statements
This
presentation
contains
“forward-looking
statements”
as
defined
in
the
Private
Securities
Litigation
Reform
Act
of
1995.
In
general,
forward-looking
statements
usually
use
words
such
as
“may,”
“believe,”
“expect,”
“anticipate,”
“intend,”
“will,”
“should,”
“plan,”
“estimate,”
“predict,”
“continue”
and
“potential”
or
the
negative
of
these
terms
or
other
comparable
terminology,
including
statements related to the expected timing of the closing of the proposed merger, the expected returns and other benefits of the
proposed merger to shareholders, estimated expense reductions resulting from the transaction and the timing of achievement of
such reductions, the impact on tangible book value, and the effect of the merger on S&T Bancorp’s and S&T Bank’s capital ratios.
Forward-looking statements represent management’s beliefs, based upon information available at the time the statements are
made, with regard to the matters addressed; they are not guarantees of future performance. Forward-looking statements are
subject to numerous assumptions, risks and uncertainties that change over time and could cause actual results or financial
condition to differ materially from those expressed in or implied by such statements, and there can be no assurances that: the
proposed merger will close when expected, the expected returns and other benefits of the proposed merger to shareholders will
be achieved, the expected operating efficiencies will result, estimated expense reductions resulting from the transaction will occur
as and when expected, or that the effect on S&T Bancorp’s and S&T Bank’s capital ratios will be as expected. Factors that could
cause or contribute to such differences include, but are not limited to, the possibility that expected benefits may not materialize in
the time frames expected or at all, or may be more costly to achieve; that the merger transaction may not be timely completed, if at
all;
that
prior
to
completion
of
the
merger
transaction
or
thereafter,
the
parties’
respective
businesses
may
not
perform
as
expected
due to transaction-related uncertainties or other factors; that the parties are unable to implement successful integration strategies;
that the required regulatory, shareholder, or other closing conditions are not satisfied in a timely manner, or at all; reputational
risks
and
the
reaction
of
the
parties’
customers
to
the
merger
transaction;
diversion
of
management
time
to
merger-related
issues;
and other factors and risk influences contained in the cautionary language included under the headings “Management’s
Discussion
and
Analysis
of
Financial
Condition
and
Results
of
Operations”
and
“Risk
Factors”
in
S&T
Bancorp’s
Form
10-K
for
the
fiscal year ended December 31, 2013 and other documents subsequently filed by S&T Bancorp with the SEC. Consequently, no
forward-looking statement can be guaranteed.  S&T Bancorp does not undertake any obligation to update or revise any forward-
looking statements, whether as a result of new information, future events or otherwise.
2

Caution About Forward-Looking Statements
This presentation is being made in respect of the proposed merger transaction involving S&T Bancorp and Integrity Bancshares,
Inc. This communication does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of
any vote or approval. In connection with the proposed merger, S&T Bancorp will file with the SEC a registration statement on
Form S-4 that will include a proxy statement/prospectus for the shareholders of Integrity Bancshares, Inc.  S&T Bancorp also
plans to file other documents with the SEC regarding the proposed merger transaction with Integrity Bancshares, Inc.  Integrity
Bancshares
will
mail
the
final
proxy
statement/prospectus
to
its
shareholders.
BEFORE
MAKING
ANY
VOTING
OR
INVESTMENT DECISION, INVESTORS ARE URGED TO READ THE PROXY STATEMENT/PROSPECTUS REGARDING THE
PROPOSED TRANSACTION AND ANY OTHER RELEVANT DOCUMENTS CAREFULLY IN THEIR ENTIRETY WHEN THEY
BECOME
AVAILABLE
BECAUSE
THEY
WILL
CONTAIN
IMPORTANT
INFORMATION
ABOUT
THE
PROPOSED
TRANSACTION. The proxy statement/prospectus, as well as other filings containing information about S&T Bancorp will be
available without charge, at the SEC’s Internet site (http://www.sec.gov). Copies of the proxy statement/prospectus can also be
obtained, when available, without charge, from S&T Bancorp’s website (http://www.stbancorp.com/), under the heading “Financial
Information”
and on Integrity Bancshares, Inc.’s website, at (www.integritybankonline.com), under the heading “Investors.”
3

A Strategically Compelling Transaction
An
Opportunistic
Partnership
Attractive
Financial
Metrics
•
High performing bank
–
45 consecutive quarters of loan growth
–
MRQ
ROACE
of
21.4%;
PA’s
top
performing
community
bank
(1)
•
Expansion into markets with favorable demographics
•
Strong commercial lending platform which aligns with S&T’s
business model
•
Integrity’s customer base provides appealing cross-sell
opportunities for S&T’s broader product suite
•
Immediately accretive to earnings per share; significant long-term
accretion with conservative cost savings of 22% identified
•
Estimated pro forma ROATCE in excess of 14.5%
•
IRR of 20%; significantly in excess of cost of capital
•
4.8
year
tangible
book
value
per
share
earnback
period
(2)
Source: Integrity and S&T company documents.
Includes institutions with >$500M in assets. Top performing by ROACE. ROACE excludes realized gains/(losses) on securities, non-recurring items and is tax-effected using a 35% assumed tax rate.
Earnback period is defined as the number of years for pro forma tangible book value per share to exceed stand-alone projected tangible book value per share.
4
(1)
(2)

Overview of Integrity Bancshares, Inc.
•
11 year old institution headquartered in
Camp Hill, PA
•
8 branch locations in south-central PA
(Cumberland, Dauphin, Lancaster and
York Counties); #10 deposit market
share
(1)
•
Strong track record of growth &
profitability
Total Loans ($M)
Total Deposits ($M)
Net Income to Common ($M)
Source: SNL Financial and Integrity company documents.
Note: YTD annualized represents the nine months ended 9/30/14, annualized over a 12-month period.
(1)     Reflects aggregate deposit market share in four operating counties. Deposit data as of 6/30/14.
5
$4.6
$7.3
$10.0
$0
$3
$6
$9
$12
12/31/12
12/31/13
YTD Annualized
$602.0
$691.0
$764.0
$500
$550
$600
$650
$700
$750
$800
12/31/12
12/31/13
9/30/14
$543.2
$676.1
$765.9
$500
$550
$600
$650
$700
$750
$800
12/31/12
12/31/13
9/30/14

Excellent Historical Performance
Source: Integrity company documents. NPAs defined as nonaccrual loans plus OREO plus loans 90+ days past due and still accruing.
Note: Profitability ratios and NCOs/Avg. Loans for the quarters ended 3/31, 6/30 and 9/30 are annualized. ROAA excludes preferred dividends.
NPAs / Loans + OREO
Net Charge-offs / Average Loans
Return on Average Common Equity
Return on Average Assets
6
12.6%
17.0%
16.5%
19.2%
21.4%
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
2012Y
2013Y
3/31/14
6/30/14
9/30/14
1.81%
0.58%
1.03%
0.82%
0.95%
0.0%
0.5%
1.0%
1.5%
2.0%
2012Y
2013Y
3/31/14
6/30/14
9/30/14
0.08%
0.10%
0.10%
0.10%
0.08%
0.00%
0.10%
0.20%
0.30%
0.40%
0.50%
2012Y
2013Y
3/31/14
6/30/14
9/30/14
0.81%
1.15%
1.15%
1.34%
1.50%
0.00%
0.40%
0.80%
1.20%
1.60%
2012Y
2013Y
3/31/14
6/30/14
9/30/14

Excellent Historical Performance
Source: Integrity company documents. NPAs defined as nonaccrual loans plus OREO plus loans 90+ days past due and still accruing.
Note: Profitability ratios and NCOs/Avg. Loans for the quarters ended 3/31, 6/30 and 9/30 are annualized. ROAA excludes preferred dividends.
7
12.6
0.10 %
0.08  %
0.95  %
(Dollars in Thousands)
At or for the year ended,
At or for the quarter ended,
12/31/12
12/31/13
3/31/14
6/30/14
9/30/14
Consolidated Balance Sheet
Total Assets
674,133
$      
761,905
$      
782,111
$      
811,676
$      
860,434
$      
Total Gross Loans
543,180
676,129
691,822
738,458
765,918
Deposits
602,001
691,008
709,567
735,201
764,007
Tangible Common Equity / Assets
5.78
%
6.27
%
6.38
%
6.59
%
6.97
%
Profitability
Net Income to Common
4,587
$           
7,339
$           
2,004
$           
2,504
$           
3,003
$           
ROAA
0.81
%
1.15
%
1.15
%
1.34
%
1.50
%
ROACE
17.0
16.5
19.2
21.4
Efficiency Ratio
67.8
50.6
48.1
47.3
43.5
Asset Quality
NCOs / Avg. Loans
0.08
%
0.10
%
0.10
%
NPAs + 90+PD / Loans + OREO
1.81
0.58
1.03
0.82

(1)
Represents estimated data at close of transaction. Pro Forma income statement data is estimated for 2015 and assumes cost savings of 22% of
Integrity’s noninterest expense, 75% phased-in, including estimated fair value adjustments and excluding restructuring charges.
(2)
Based on 7 trading day VWAP ending 10.28.14 ($25.4519)
Strong Pro Forma Financial Metrics and Attractive Valuation
8

Expansion Into South-central PA
•
Provides branch presence in
Lancaster, York, Dauphin, and
Cumberland counties
•
Land for two future branch sites in
York County already owned
•
Total population of markets served
of approximately 1.5 million
Source: SNL Financial
9

South-central PA Deposit Market Share
Source: SNL Financial, credcpa.org and www.smartmarket.org.
Note: Deposit data as of 6/30/14. Reflects aggregate deposit market share for Cumberland, Dauphin, Lancaster and York Counties.
(1)     Subsidiary of Royal Bank of Scotland Group.
•
#10 deposit market share in operating
area; #3 for community banks
•
< 3% market share provides substantial
room for continued growth
•
Local area economy bolstered by state
and national government and strong
healthcare presence
Top Regional Employers
Total Market Deposits $28.3 billion
10
Rank
Institution
Number
of
Branches
Market
Share
(%)
1
Susquehanna Bancshares Inc.
70
14.7
2
M&T Bank Corp.
70
14.4
3
Fulton Financial Corp.
54
13.9
4
PNC Financial Services Group Inc.
64
12.4
5
Wells Fargo & Co.
33
8.6
6
Metro Bancorp Inc.
25
6.8
7
Banco Santander SA
43
4.6
8
Citizens Financial Group, Inc. (1)
22
3.5
9
Codorus Valley Bancorp Inc.
17
3.2
10
Integrity Bancshares Inc.
8
2.6
11
ENB Financial Corp
12
2.4
12
Orrstown Financial Services Inc.
10
2.1
13
Mid Penn Bancorp Inc.
12
2.0
14
Donegal Financial Services Corp.
17
1.5
15
National Penn Bancshares Inc.
6
1.1
16
Northwest Bancshares Inc.
16
1.1
17
Centric Financial Corp.
4
1.0
18
York Traditions Bank
4
0.8
19
Franklin Financial Services Corp.
8
0.7
20
ACNB Corp.
5
0.5
Total For Institutions In Market
524

Demographically Attractive Markets
Source: SNL Financial.
Note: Data is deposit weighted by county deposits. Deposit data as of 6/30/14.
% of Households With Income > $100K
Median Home Price
August 2014 Unemployment Rate
Median Household Income
11

Management Team Retention
Integrity
Management
Current Position
Career Experience
Jim Gibson
Chief Executive
Officer
Founder of Integrity Bancshares
Will join S&T Bancorp Board of Directors
Tom Sposito
Chief Operating
Officer
Former President/CEO of Pennsylvania State Bank
Chief Banking Officer of Sterling Financial
EVP & Central PA Market Manager at PNC
William Poole
EVP -
Business
Development
Founder & CEO of HomeTowne Heritage Bank
EVP & CLO for Bank of Lancaster County
Dennis Ginder
Chief Credit Officer
Former President of Bank of Lancaster County
Senior credit roles at Sterling Financial and PNC
Jordan Space
Chief Lending
Officer
Formerly a relationship manager with M&T co-managing a
$500 million portfolio
•
Integrity has built the top team of community bankers in south-central PA
•
To maintain existing momentum, Integrity’s customer facing team will be
retained and several key executives have executed employment agreements:
12

Continuation of Effective Expansion Strategy
•
2008 -
IBT Bancorp
$ 827
•
2012 -
Mainline Bancorp
242
•
2012 -
Gateway Bank of Pennsylvania
126
•
2014 -
Integrity Bancshares, Inc.
860
Assets Acquired
($ in Millions)
$2,055
•
2012 -
Loan production office opened in northeast Ohio in August 2012
•
2014 -
Loan production office opened in central Ohio in January 2014
•
2014 -
Hired a team of bankers in State College, PA and branch opened
in June 2014
Source: SNL Financial and S&T company documents.
Data represents assets at completion for all deals other than Integrity.
13

Transaction Overview
Aggregate Consideration
(1)(2)
Approximately $155 million
Consideration Mix
80% common stock / 20% cash
Per Share Consideration
Structure
$52.50 per share in cash or 2.0627
(2)
shares of STBA
common stock subject to the 80% stock / 20% cash
consideration mix
Corporate Governance
Two board seats for existing directors of Integrity, including
Jim Gibson
Approval Requirements
Integrity shareholders and customary regulatory approvals
Integration
Integrity Bank to merge with S&T Bank
Will
operate
as
Integrity
Bank
–
A
Division
of
S&T
Bank
Anticipated Closing
Q1 2015
Termination Fee
$6.25 million
(1)
Assumes 2,924,356 shares outstanding plus 63,053 options with a weighted strike price of $23.03.
(2)
Based on 7 trading day VWAP ending 10.28.14 ($25.4519)
14

Transaction Multiple Comparison
S&T and Integrity
Deal Value Per Share = $52.50
Comparable
Transactions
(1)
Basis
Multiple
Median Value
Price / LTM Earnings
$3.29
16.0x
17.4x
Price / Tangible Book
$20.50
2.6x
2.2x
Premium / Core TCE
(2)
$68.8M
2.4x
2.3x
Target Comparison
Integrity
Target Median
MRQ ROAA
1.50%
1.16%
Tangible Common
Equity / Assets
6.97%
8.75%
(1)
Includes all deals with announced values greater than $50 million and price to tangible book value greater than 2.0x announced since 1/1/2013.
(2)
Core
TCE
defined
as
8.0%
of
tangible
assets.
Multiple
calculated
as
aggregate
transaction
value
less
tangible
common
equity
plus
8.0%
times
tangible
assets
divided
by
8.0%
times
tangible
assets.
15

Key Transaction Assumptions
Cost Savings
Identified 22% of Integrity’s operating expense
Approximately $3.2 million pre-tax based on 2014 YTD
annualized expenses
75% realized in 2015; 100% thereafter
Credit Mark
$9.5 million or 1.2% of 9/30 gross loans
2.3x nonperforming loans
(1)
; 1.0x ALLL
Additional Purchase
Accounting Marks
$1.5 million rate premium on loans
$1.5 million rate premium on time deposits
One Time Costs
Approximately $9.7 million (6.3% of transaction value)
on a pre-tax basis
Debt Redemption
Integrity’s $13.5 million of outstanding subordinated
debt is redeemed in conjunction with close
Integrity Preferred Stock
Matured and was paid off per its terms on October 28
(1)
Defined as nonaccrual loans plus loans 90+ days past due and still accruing.
16

Pro Forma Impact
EPS Accretion
(1)
6.1% in 2015 excluding one-time charges and
2.0% in 2015 including one-time charges.
8.8% in 2016
Tangible Book Value Dilution
8.7%
Earnback Period
(2)
4.8
years
Internal Rate of Return
20%
Pro
Forma
Capital
(9/30/14)
(3)
Tangible Common Equity / Assets
Tier 1 Common Risk Based Capital
Total Capital Ratio
8.1%
(-95 bps)
10.5%
(-134 bps)
12.6%
(-173 bps)
(1)
Based upon consensus earnings estimates.
(2)
Earnback period is defined as the number of years for pro forma tangible book value per share to exceed stand-alone projected tangible book value per share.
(3)
Includes the redemption of Integrity’s $13.5 million of outstanding subordinated debt in conjunction with the transaction. Calculation based upon current regulatory capital methodology.
17

Summary
Strategically
Compelling
Financially
Attractive
•
Expansion into attractive south-central PA market
through region’s best performing community bank
•
Proven track record of growth & strong profitability
•
Allows for expansion through increased lending capacity
and ability to offer additional product lines to Integrity’s
customers
•
Retain growth focused lending team & in-market brand
recognition through Integrity Bank name
•
Earnings accretion in the high single digits with fully
phased in cost savings
•
IRR of 20%; significantly in excess of cost of capital
•
Potential for additional revenue enhancements
18

APPENDIX
19

Pro Forma Loan Composition
S&T
Integrity
Pro Forma
Source: S&T and Integrity company documents. Data as of 9/30/14.
Data does not include purchase accounting adjustments.
x
x
Loan Type
Amount
($M)
% of
Total
Commercial Real Estate
296.2
$     
38.7%
Commercial & Industrial
169.0
22.1%
Construction
101.1
13.2%
Residential
163.6
21.4%
Consumer & Other
35.9
4.7%
Total Loans
765.9
$     
100.0%
x
x
x
x
Loan Type
Amount
($M)
% of
Total
Commercial Real Estate
1,691.6
$  
44.5%
Commercial & Industrial
946.4
24.9%
Construction
186.5
4.9%
Residential
910.1
23.9%
Consumer & Other
69.7
1.8%
Total Loans
3,804.3
$  
100.0%
x
x
x
x
Loan Type
Amount
($M)
% of
Total
Commercial Real Estate
1,987.9
$  
43.5%
Commercial & Industrial
1,115.3
24.4%
Construction
287.6
6.3%
Residential
1,073.7
23.5%
Consumer & Other
105.7
2.3%
Total Loans
4,570.2
$  
100.0%
x
x
20
Commercial
Real Estate
44.5%
Commercial
& Industrial
24.9%
Construction
4.9%
Residential
23.9%
Consumer &
Other
1.8%
Commercial
Real Estate
43.5%
Commercial
& Industrial
24.4%
Construction
6.3%
Residential
23.5%
Consumer &
Other
2.3%
Commercial
Real Estate
38.7%
Commercial
& Industrial
22.1%
Construction
13.2%
Residential
21.4%
Consumer &
Other
4.7%

Pro Forma Deposit Composition
S&T
Integrity
Pro Forma
Source: S&T and Integrity company documents. Data as of 9/30/14.
Data does not include purchase accounting adjustments.
x
x
Deposit Type
Amount
($M)
% of
Total
NIB Demand
1,077.5
$  
27.6%
Interest Bearing Demand
336.7
8.6%
MMDA and Savings
1,343.7
34.4%
Time Deposits <$100,000
785.7
20.1%
Time Deposits >$100,000
357.4
9.2%
Total Deposits
3,901.0
$  
100.0%
x
x
x
x
Deposit Type
Amount
($M)
% of
Total
NIB Demand
44.7
$        
5.9%
Interest Bearing Demand
388.2
50.8%
MMDA and Savings
98.7
12.9%
Time Deposits <$100,000
117.2
15.3%
Time Deposits >$100,000
115.2
15.1%
Total Deposits
764.0
$     
100.0%
x
x
x
x
Deposit Type
Amount
($M)
% of
Total
NIB Demand
1,122.2
$  
24.1%
Interest Bearing Demand
724.9
15.5%
MMDA and Savings
1,442.4
30.9%
Time Deposits <$100,000
902.9
19.4%
Time Deposits >$100,000
472.6
10.1%
Total Deposits
4,665.0
$  
100.0%
x
x
21
NIB Demand
24.1%
Interest
Bearing
Demand
15.5%
MMDA and
Savings
30.9%
Time Deposits
<$100,000
19.4%
Time Deposits
>$100,000
10.1%
NIB Demand
27.6%
Interest
Bearing
Demand
8.6%
MMDA and
Savings
34.4%
Time
Deposits
<$100,000
20.1%
Time
Deposits
>$100,000
9.2%
NIB Demand
5.9%
Interest
Bearing
Demand
50.8%
MMDA and
Savings
Time
Deposits
<$100,000
15.3%
Time
Deposits
>$100,000
15.1%
12.9%