UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
Pursuant to Section 13 or 15(d)
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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:
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02. | Results of Operations and Financial Condition. |
On April 30, 2020, the Registrant provided an investor presentation. A copy of the investor presentation is attached as Exhibit 99.1 to this Current Report on Form 8-K.
Item 7.01. | Regulation FD Disclosure. |
Item 2.02 is incorporated herein by reference.
Item 9.01. | Financial Statements and Exhibits. |
(d) Exhibits.
The following Exhibits are filed with this Current Report on Form 8-K:
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99.1 |
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104 |
Cover Page Interactive Data File (embedded within the Inline XBRL document). |
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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.
Lakeland Bancorp, Inc. | ||||
Date: April 30, 2020 |
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/s/ Thomas J. Shara | ||
Name: |
Thomas J. Shara | |||
Title: |
President and Chief Executive Officer |
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Exhibit 99.1 FIRST QUARTER 2020 INVESTORS PRESENTATIONExhibit 99.1 FIRST QUARTER 2020 INVESTORS PRESENTATION
Forward-Looking Statements The information disclosed in this document, nationally, regionally and in the Company’s including the statements regarding the markets, the nature and timing of actions of the prospective impact of COVID-19, includes various Federal Reserve Board and other regulators, the forward-looking statements that are made in nature and timing of legislation and regulation reliance upon the safe harbor provisions of the affecting the financial services industry, Private Securities Litigation Reform Act of 1995. government intervention in the U.S. financial The words “anticipates”, “projects”, “intends”, system, changes in federal and state tax laws, “estimates”, “expects”, “believes”, “plans”, “may”, changes in levels of market interest rates, pricing “will”, “should”, “could”, and other similar pressures on loan and deposit products, credit expressions are intended to identify such forward- risks of the Company’s lending and leasing looking statements. The Company cautions that activities, successful implementation, deployment these forward-looking statements are necessarily and upgrades of new and existing technology, speculative and speak only as of the date made, systems, services and products, customers’ and are subject to numerous assumptions, risks acceptance of the Company’s products and and uncertainties, all of which may change over services and competition. Any statements made time. Actual results could differ materially from by the Company that are not historical facts such forward-looking statements. The following should be considered to be forward-looking factors, among others, could cause actual results statements. The Company is not obligated to to differ materially and adversely from such update and does not undertake to update any of forward-looking statements: changes in the its forward-looking statements made herein. financial services industry and the U.S. and global capital markets, changes in economic conditions 2Forward-Looking Statements The information disclosed in this document, nationally, regionally and in the Company’s including the statements regarding the markets, the nature and timing of actions of the prospective impact of COVID-19, includes various Federal Reserve Board and other regulators, the forward-looking statements that are made in nature and timing of legislation and regulation reliance upon the safe harbor provisions of the affecting the financial services industry, Private Securities Litigation Reform Act of 1995. government intervention in the U.S. financial The words “anticipates”, “projects”, “intends”, system, changes in federal and state tax laws, “estimates”, “expects”, “believes”, “plans”, “may”, changes in levels of market interest rates, pricing “will”, “should”, “could”, and other similar pressures on loan and deposit products, credit expressions are intended to identify such forward- risks of the Company’s lending and leasing looking statements. The Company cautions that activities, successful implementation, deployment these forward-looking statements are necessarily and upgrades of new and existing technology, speculative and speak only as of the date made, systems, services and products, customers’ and are subject to numerous assumptions, risks acceptance of the Company’s products and and uncertainties, all of which may change over services and competition. Any statements made time. Actual results could differ materially from by the Company that are not historical facts such forward-looking statements. The following should be considered to be forward-looking factors, among others, could cause actual results statements. The Company is not obligated to to differ materially and adversely from such update and does not undertake to update any of forward-looking statements: changes in the its forward-looking statements made herein. financial services industry and the U.S. and global capital markets, changes in economic conditions 2
Corporate Profile LBAI - NASDAQ Founded in 1969 51 Branches - Serving Northern/Central NJ & Hudson Valley, NY 8 Regional Commercial Lending Centers 1 Commercial Loan Production Office Financial Snapshot Assets $7.0 Billion Loans $5.3 Billion Deposits $5.5 Billion (1) Market Cap $545 Million 1 Stock Price as of March 31, 2020 - $ 10.81 3Corporate Profile LBAI - NASDAQ Founded in 1969 51 Branches - Serving Northern/Central NJ & Hudson Valley, NY 8 Regional Commercial Lending Centers 1 Commercial Loan Production Office Financial Snapshot Assets $7.0 Billion Loans $5.3 Billion Deposits $5.5 Billion (1) Market Cap $545 Million 1 Stock Price as of March 31, 2020 - $ 10.81 3
Who We Are Half a century after opening for business in Newfoundland, NJ. We have grown to a network of over 50 offices, committed to meeting the financial needs of local residents & businesses, and are proud to be characterized as the following. Traditional Commercial Bank Conservative & Consistent Scarce & Valuable Franchise Banking Philosophy Relationship Lender One of the Largest Publically Diversified Commercial Real Traded Banks in NJ Low Risk Model Estate Portfolio One of the Lowest Cost of Disciplined Acquirer (1) Focus is NOT Multifamily Lending Funds in the State (1) Source: S&P Global Q1 2020 for NJ banks with total assets greater than $500 million. 4Who We Are Half a century after opening for business in Newfoundland, NJ. We have grown to a network of over 50 offices, committed to meeting the financial needs of local residents & businesses, and are proud to be characterized as the following. Traditional Commercial Bank Conservative & Consistent Scarce & Valuable Franchise Banking Philosophy Relationship Lender One of the Largest Publically Diversified Commercial Real Traded Banks in NJ Low Risk Model Estate Portfolio One of the Lowest Cost of Disciplined Acquirer (1) Focus is NOT Multifamily Lending Funds in the State (1) Source: S&P Global Q1 2020 for NJ banks with total assets greater than $500 million. 4
Balanced Loan Portfolio (1) Loan Portfolio Growth Loan Composition Consumer Residential CAGR excluding acquisitions: 9.3% $340 Mortgage CAGR: 14.8% 7% $334 6% Leases $5,332 $116 $5,141 2% Construction $4,460 $334 6% $4,157 $3,874 C&I $467 $2,968 9% CRE $3,741 70% CRE / Capital (2) 446% 2015 2016 2017 2018 2019 2020 Q1 (1) Acquired loans of $580 in 2016, $426 in 2019 (2) Represents Lakeland Bank’s CRE to total risk based capital ratio, as of March 31, 2020, per 5 regulatory guidelinesBalanced Loan Portfolio (1) Loan Portfolio Growth Loan Composition Consumer Residential CAGR excluding acquisitions: 9.3% $340 Mortgage CAGR: 14.8% 7% $334 6% Leases $5,332 $116 $5,141 2% Construction $4,460 $334 6% $4,157 $3,874 C&I $467 $2,968 9% CRE $3,741 70% CRE / Capital (2) 446% 2015 2016 2017 2018 2019 2020 Q1 (1) Acquired loans of $580 in 2016, $426 in 2019 (2) Represents Lakeland Bank’s CRE to total risk based capital ratio, as of March 31, 2020, per 5 regulatory guidelines
Commercial Loan Portfolio Commercial Portfolio Growth Commercial Loan Composition Owner Occupied 18% $4,541 $4,357 Multifamily 16% $3,713 Retail 15% $3,436 $3,118 Industrial 11% Office 10% $2,187 Mixed 9% Other 6% Portfolio Residential Constr. 6% *W Avg. LTV 53% Comm'l Res 1-4 Fam *W Avg. DSCR 1.7 5% Commercial Constr. 2% 2015 2016 2017 2018 2019 2020 Q1 Hotels/Resturants 2% CRE C&I Construction * W Avg. LTV and DSCR as of most recent financial review 6Commercial Loan Portfolio Commercial Portfolio Growth Commercial Loan Composition Owner Occupied 18% $4,541 $4,357 Multifamily 16% $3,713 Retail 15% $3,436 $3,118 Industrial 11% Office 10% $2,187 Mixed 9% Other 6% Portfolio Residential Constr. 6% *W Avg. LTV 53% Comm'l Res 1-4 Fam *W Avg. DSCR 1.7 5% Commercial Constr. 2% 2015 2016 2017 2018 2019 2020 Q1 Hotels/Resturants 2% CRE C&I Construction * W Avg. LTV and DSCR as of most recent financial review 6
Strong Asset Quality (1) Nonaccruals / Loans (%) NPAs / Loans + OREO (%) 1.40% 2.00% 1.05% 1.50% 0.77% 1.22% 0.74% 1.14% 0.61% 0.70% 1.00% 0.70% 0.41% 0.62% 0.33% 0.53% 0.50% 0.27% 0.35% 0.50% 0.00% 0.00% 2015 2016 2017 2018 2019 2020 Q1 2015 2016 2017 2018 2019 2020 Q1 Reserves / Nonaccrual Loans (%) NCOs / Avg. Loans (%) 0.50% 350.0% 310.7% 300.0% 0.40% 259.7% 250.0% 0.30% 189.2% 200.0% 0.19% 150.9% 136.0% 0.20% 150.0% 122.4% 100.0% 0.10% 0.06% 0.05% 0.05% 0.03% 50.0% 0.00% 0.00% 0.0% 2015 2016 2017 2018 2019 2020 Q1 2015 2016 2017 2018 2019 2020 Q1 (0.10%) (1) NPAs include Troubled Debt Restructurings. 7Strong Asset Quality (1) Nonaccruals / Loans (%) NPAs / Loans + OREO (%) 1.40% 2.00% 1.05% 1.50% 0.77% 1.22% 0.74% 1.14% 0.61% 0.70% 1.00% 0.70% 0.41% 0.62% 0.33% 0.53% 0.50% 0.27% 0.35% 0.50% 0.00% 0.00% 2015 2016 2017 2018 2019 2020 Q1 2015 2016 2017 2018 2019 2020 Q1 Reserves / Nonaccrual Loans (%) NCOs / Avg. Loans (%) 0.50% 350.0% 310.7% 300.0% 0.40% 259.7% 250.0% 0.30% 189.2% 200.0% 0.19% 150.9% 136.0% 0.20% 150.0% 122.4% 100.0% 0.10% 0.06% 0.05% 0.05% 0.03% 50.0% 0.00% 0.00% 0.0% 2015 2016 2017 2018 2019 2020 Q1 2015 2016 2017 2018 2019 2020 Q1 (0.10%) (1) NPAs include Troubled Debt Restructurings. 7
Commercial Loan Forbearance Commercial Portfolio Forbearance Requests Total Outstanding Balance $4.7 Billion By Loan Type Total Forbearance Requests: $745 Million Equipment Finance C & I CRE: Owner $38 $59 Occupied 5% 8% $103 Construction 14% and Land Yes $15 $745 2% 16% CRE: Investor No Owned $3,913 $530 71% 84% Forbearance Requests are well secured and represent 16% of Portfolio Data as of April 16, 2020 Forbearance requests require credit approval 8Commercial Loan Forbearance Commercial Portfolio Forbearance Requests Total Outstanding Balance $4.7 Billion By Loan Type Total Forbearance Requests: $745 Million Equipment Finance C & I CRE: Owner $38 $59 Occupied 5% 8% $103 Construction 14% and Land Yes $15 $745 2% 16% CRE: Investor No Owned $3,913 $530 71% 84% Forbearance Requests are well secured and represent 16% of Portfolio Data as of April 16, 2020 Forbearance requests require credit approval 8
Commercial Loan Forbearance Request Detail Forbearance Requests of $745M by Property Type Commercial Loans with Recourse Retail $161 Mixed Use $87 No Office $65 14% Industrial $64 Multi Family $58 Special Use $57 1-4 Family $54 Yes Hotels $46 86% Commercial $40 Equip Finance $38 Hospitality $29 Healthcare $20 Construction $15 Restaurants $11 Data as of April 16, 2020 9Commercial Loan Forbearance Request Detail Forbearance Requests of $745M by Property Type Commercial Loans with Recourse Retail $161 Mixed Use $87 No Office $65 14% Industrial $64 Multi Family $58 Special Use $57 1-4 Family $54 Yes Hotels $46 86% Commercial $40 Equip Finance $38 Hospitality $29 Healthcare $20 Construction $15 Restaurants $11 Data as of April 16, 2020 9
Residential and Consumer Loan Forbearance Residential / Consumer Portfolio Total Outstanding Balance $674 Million Residential Consumer WA FICO 780 720 Residential Forbearance Requests $36 Million WA LTV 52% 51% Origination Vintage Analysis Forbearance Requests $54 Million 8% of Residential / Consumer Portfolio 2008 and Earlier $5 12% 2018 to 2009 to 2011 Present $5 $13 14% 37% Consumer $18 2012 to 2014 Residential $6 $36 17% 2015 to 2017 $7 20% Data as of April 16, 2020 10Residential and Consumer Loan Forbearance Residential / Consumer Portfolio Total Outstanding Balance $674 Million Residential Consumer WA FICO 780 720 Residential Forbearance Requests $36 Million WA LTV 52% 51% Origination Vintage Analysis Forbearance Requests $54 Million 8% of Residential / Consumer Portfolio 2008 and Earlier $5 12% 2018 to 2009 to 2011 Present $5 $13 14% 37% Consumer $18 2012 to 2014 Residential $6 $36 17% 2015 to 2017 $7 20% Data as of April 16, 2020 10
Core Deposit Focus (2) Deposit Composition Deposit Growth $6,000 $5,455 Jumbo Time $5,294 CAGR ex acquisitions: 9.8% $238 CAGR: 15.1% $4,620 $5,000 $4,369 4% $4,093 $4,000 Retail Time $2,996 $846 $3,000 16% $2,000 Savings and $1,000 NOW $0 Accounts 2015 2016 2017 2018 2019 2020 Q1 $3,241 Demand Core Deposits CDs 59% Deposits $1,130 (3) Demand Deposit Growth 21% CAGR ex acquisitions: 7.4% $1,130 $1,124 CAGR: 12.1% $967 Q1 Cost of Total Deposits: 0.82% $950 $927 Core Deposits: 80% $694 2015 2016 2017 2018 2019 2020 Q1 (1) Jumbo time deposits defined as time deposits above $250,000 (2) Acquired deposits in 2016 = $583, 2019 = $410 11 (3) Acquired demand deposits in 2016 = $108, 2019 = $81Core Deposit Focus (2) Deposit Composition Deposit Growth $6,000 $5,455 Jumbo Time $5,294 CAGR ex acquisitions: 9.8% $238 CAGR: 15.1% $4,620 $5,000 $4,369 4% $4,093 $4,000 Retail Time $2,996 $846 $3,000 16% $2,000 Savings and $1,000 NOW $0 Accounts 2015 2016 2017 2018 2019 2020 Q1 $3,241 Demand Core Deposits CDs 59% Deposits $1,130 (3) Demand Deposit Growth 21% CAGR ex acquisitions: 7.4% $1,130 $1,124 CAGR: 12.1% $967 Q1 Cost of Total Deposits: 0.82% $950 $927 Core Deposits: 80% $694 2015 2016 2017 2018 2019 2020 Q1 (1) Jumbo time deposits defined as time deposits above $250,000 (2) Acquired deposits in 2016 = $583, 2019 = $410 11 (3) Acquired demand deposits in 2016 = $108, 2019 = $81
NJ Deposit Market Share Number in Market of Market Share Institution Branches ($mm) (%) Rank 1 Valley National Bancorp 166 1 8,121 20.7 2 Investors Bancorp Inc. 112 1 5,605 17.8 3 OceanFirst Financial Corp. 79 7,192 8.2 4 Provident Financial Services Inc. 81 6,686 7.6 5 Columbia Financial Inc. (MHC) 61 5,663 6.5 6 Lakeland Bancorp Inc. 51 5,029 5.7 7 ConnectOne Bancorp Inc. 29 4,809 5.5 8 Kearny Financial Corp. 52 4,174 4.8 9 Peapack-Gladstone Financial Corp. 20 4,104 4.7 10 Spencer Savings Bank SLA 24 2,112 2.4 Top 10 New Jersey Banks 675 73,495 83.9 Total NJ Banks In Market 915 87,621 100.0 Source: S&P Global as of June 2019. 12NJ Deposit Market Share Number in Market of Market Share Institution Branches ($mm) (%) Rank 1 Valley National Bancorp 166 1 8,121 20.7 2 Investors Bancorp Inc. 112 1 5,605 17.8 3 OceanFirst Financial Corp. 79 7,192 8.2 4 Provident Financial Services Inc. 81 6,686 7.6 5 Columbia Financial Inc. (MHC) 61 5,663 6.5 6 Lakeland Bancorp Inc. 51 5,029 5.7 7 ConnectOne Bancorp Inc. 29 4,809 5.5 8 Kearny Financial Corp. 52 4,174 4.8 9 Peapack-Gladstone Financial Corp. 20 4,104 4.7 10 Spencer Savings Bank SLA 24 2,112 2.4 Top 10 New Jersey Banks 675 73,495 83.9 Total NJ Banks In Market 915 87,621 100.0 Source: S&P Global as of June 2019. 12
Investment Securities Portfolio Securities Composition $946 million, or 13% of assets Equities, CRA Government 2% Primarily used for liquidity purposes & Agencies 20% Short term agencies, MBS, and municipals MBS/CMO 63% Corporate Debt Average Yield for Q1: 2.57% 1% Municipals Weighted Average Life: 5.0 years 9% ABS 5% Effective Duration: 3.6 years AFS is 88% of portfolio / HTM is 12% 13Investment Securities Portfolio Securities Composition $946 million, or 13% of assets Equities, CRA Government 2% Primarily used for liquidity purposes & Agencies 20% Short term agencies, MBS, and municipals MBS/CMO 63% Corporate Debt Average Yield for Q1: 2.57% 1% Municipals Weighted Average Life: 5.0 years 9% ABS 5% Effective Duration: 3.6 years AFS is 88% of portfolio / HTM is 12% 13
Mergers & Acquisitions Highlands Bancorp Harmony Bank Pascack Bancorp Legacy Highlands (4) Legacy Harmony (3) Legacy Pascack (7) LPOs (2) LPOs (2) LPOs (2) Announcement Date: 8/23/2018 Announcement Date: 2/18/2016 Announcement Date: 8/4/2015 Assets: $488mm Assets: $295mm Assets: $403mm Deal Value: $56.7mm Deal Value: $32.0mm Deal Value: $43.8mm Price/TBV: 1.89x Price/TBV: 1.29x Price/TBV: 1.31x EPS Accretion: 4.0% EPS Accretion: 1.0% EPS Accretion: 4.5% TBV Dilution: ~1.5% TBV Dilution: ~0.5% TBV Dilution: ~2.7% TBV Earnback: < 2 Years TBV Earnback: 3.5 Years TBV Earnback: 3.5 Years Board Seats: None Board Seats: None Board Seats: Lawrence Inserra Jr. Rationale Rationale Rationale • Expanding presence in Sussex, Passaic and • Expansion into • Growth opportunity in Bergen/Essex Counties Morris counties Middlesex/Monmouth/Ocean Counties • Exclusive negotiations • Low execution risk and achievable cost • Leverage Existing Commercial Loan savings Production Office • Exclusive negotiations Note: Represents data at announcement date 14Mergers & Acquisitions Highlands Bancorp Harmony Bank Pascack Bancorp Legacy Highlands (4) Legacy Harmony (3) Legacy Pascack (7) LPOs (2) LPOs (2) LPOs (2) Announcement Date: 8/23/2018 Announcement Date: 2/18/2016 Announcement Date: 8/4/2015 Assets: $488mm Assets: $295mm Assets: $403mm Deal Value: $56.7mm Deal Value: $32.0mm Deal Value: $43.8mm Price/TBV: 1.89x Price/TBV: 1.29x Price/TBV: 1.31x EPS Accretion: 4.0% EPS Accretion: 1.0% EPS Accretion: 4.5% TBV Dilution: ~1.5% TBV Dilution: ~0.5% TBV Dilution: ~2.7% TBV Earnback: < 2 Years TBV Earnback: 3.5 Years TBV Earnback: 3.5 Years Board Seats: None Board Seats: None Board Seats: Lawrence Inserra Jr. Rationale Rationale Rationale • Expanding presence in Sussex, Passaic and • Expansion into • Growth opportunity in Bergen/Essex Counties Morris counties Middlesex/Monmouth/Ocean Counties • Exclusive negotiations • Low execution risk and achievable cost • Leverage Existing Commercial Loan savings Production Office • Exclusive negotiations Note: Represents data at announcement date 14
Franchise Growth Total Tangible Book Value Per Core Earnings Per (1) (2) Assets Share Share CAGR: 10.0% CAGR: 15.0% $1.43 $7,014 $6,711 $1.32 $11.43 $11.18 $5,806 $1.11 $10.22 $5,406 $1.02 $5,093 $9.38 $8.70 $0.88 $7.62 $3,870 $0.24 2015 2016 2017 2018 2019 2020 Q1 2015 2016 2017 2018 2019 2020 Q1 2015 2016 2017 2018 2019 2020 Q1 (1) Acquired total assets of $732 in 2016, $496 in 2019 (2) Core earnings per share excludes non-recurring items, merger related expenses and related 15 gains/losses on sale of securitiesFranchise Growth Total Tangible Book Value Per Core Earnings Per (1) (2) Assets Share Share CAGR: 10.0% CAGR: 15.0% $1.43 $7,014 $6,711 $1.32 $11.43 $11.18 $5,806 $1.11 $10.22 $5,406 $1.02 $5,093 $9.38 $8.70 $0.88 $7.62 $3,870 $0.24 2015 2016 2017 2018 2019 2020 Q1 2015 2016 2017 2018 2019 2020 Q1 2015 2016 2017 2018 2019 2020 Q1 (1) Acquired total assets of $732 in 2016, $496 in 2019 (2) Core earnings per share excludes non-recurring items, merger related expenses and related 15 gains/losses on sale of securities
Consistent Profitability (1) (1) Core Return on Assets (%) Core Return on Equity (%) 1.25% 1.16% 1.15% 12.00% 10.66% 10.48% 1.01% 9.35% 0.96% 9.34% 10.00% 0.93% 1.00% 8.61% 0.76% 8.00% 6.77% 0.75% 6.00% 0.50% 4.00% 0.25% 2.00% 0.00% 0.00% 2015 2016 2017 2018 2019 2020 Q1 2015 2016 2017 2018 2019 2020 Q1 (2) Net Interest Margin (%) Efficiency Ratio (%) 4.00% 66.0% 3.75% 61.1% 62.0% 3.47% 3.50% 3.41% 3.38% 58.0% 56.7% 3.36% 56.1% 3.33% 3.28% 55.3% 54.8% 3.25% 53.4% 54.0% 3.00% 50.0% 2015 2016 2017 2018 2019 2020 Q1 2015 2016 2017 2018 2019 2020 Q1 (1) Core income excludes nonrecurring items, merger related expenses and related gains/losses on sale of securities. 16 (2) Source: S&P Global through 2018. Company records for 2019 & 2020.Consistent Profitability (1) (1) Core Return on Assets (%) Core Return on Equity (%) 1.25% 1.16% 1.15% 12.00% 10.66% 10.48% 1.01% 9.35% 0.96% 9.34% 10.00% 0.93% 1.00% 8.61% 0.76% 8.00% 6.77% 0.75% 6.00% 0.50% 4.00% 0.25% 2.00% 0.00% 0.00% 2015 2016 2017 2018 2019 2020 Q1 2015 2016 2017 2018 2019 2020 Q1 (2) Net Interest Margin (%) Efficiency Ratio (%) 4.00% 66.0% 3.75% 61.1% 62.0% 3.47% 3.50% 3.41% 3.38% 58.0% 56.7% 3.36% 56.1% 3.33% 3.28% 55.3% 54.8% 3.25% 53.4% 54.0% 3.00% 50.0% 2015 2016 2017 2018 2019 2020 Q1 2015 2016 2017 2018 2019 2020 Q1 (1) Core income excludes nonrecurring items, merger related expenses and related gains/losses on sale of securities. 16 (2) Source: S&P Global through 2018. Company records for 2019 & 2020.
2020 Quarter 1 Highlights Q1 Q1 ($mm except per share) 2019 2020 Balance Sheet Q1 2020 total assets of $7.01 billion up $302.7 million or 4.5% compared to Q4 2019 Total Assets $6,365 $7,014 Total Loans 4,925 5,332 Total Deposits 5,065 5,455 Q1 2020 total loans of $5.33 billion up $190.9 million or 3.7% compared to Q4 2019 Consolidated Capital (%) TCE / TA 8.41 % 8.41 % Q1 2020 total deposits of $5.46 billion up $161.4 Tier 1 Risk-Based Ratio 10.98 10.61 million or 3.1% compared to Q4 2019 Total Risk-Based Capital Ratio 13.48 13.04 Q1 2020 net interest margin increased 1 basis point Asset Quality (%) from Q4 2019 (1) % NPAs/ Loans + OREO 0.46 % 0.70 NCOs/ Avg Loans 0.02 0.03 Tangible book value per share of $11.43 up 10% in Reserves/ Gross Loans 0.77 0.92 last 12 months Profitability Net Income $15.6 $12.4 Diluted EPS 0.31 0.24 ROAA 1.02 % 0.76 % ROAE 9.41 6.77 Noninterest Inc./ Operating Rev. 10.5 13.8 Net Interest Margin 3.42 3.28 (1) NPAs include Troubled Debt Restructurings 172020 Quarter 1 Highlights Q1 Q1 ($mm except per share) 2019 2020 Balance Sheet Q1 2020 total assets of $7.01 billion up $302.7 million or 4.5% compared to Q4 2019 Total Assets $6,365 $7,014 Total Loans 4,925 5,332 Total Deposits 5,065 5,455 Q1 2020 total loans of $5.33 billion up $190.9 million or 3.7% compared to Q4 2019 Consolidated Capital (%) TCE / TA 8.41 % 8.41 % Q1 2020 total deposits of $5.46 billion up $161.4 Tier 1 Risk-Based Ratio 10.98 10.61 million or 3.1% compared to Q4 2019 Total Risk-Based Capital Ratio 13.48 13.04 Q1 2020 net interest margin increased 1 basis point Asset Quality (%) from Q4 2019 (1) % NPAs/ Loans + OREO 0.46 % 0.70 NCOs/ Avg Loans 0.02 0.03 Tangible book value per share of $11.43 up 10% in Reserves/ Gross Loans 0.77 0.92 last 12 months Profitability Net Income $15.6 $12.4 Diluted EPS 0.31 0.24 ROAA 1.02 % 0.76 % ROAE 9.41 6.77 Noninterest Inc./ Operating Rev. 10.5 13.8 Net Interest Margin 3.42 3.28 (1) NPAs include Troubled Debt Restructurings 17
Strong Capital Position Tangible Common Equity Ratio (%) Total Capital / Risk-Weighted Assets (%) 9.83% 13.61% 13.48% 9.73% 9.54% 13.04% 12.99% 12.81% 8.43% 8.41% 8.41% 12.31% Lakeland Bancorp Lakeland Bank Lakeland Bancorp Lakeland Bank March 31, 2018 March 31, 2019 March 31, 2020 March 31, 2018 March 31, 2019 March 31, 2020 18Strong Capital Position Tangible Common Equity Ratio (%) Total Capital / Risk-Weighted Assets (%) 9.83% 13.61% 13.48% 9.73% 9.54% 13.04% 12.99% 12.81% 8.43% 8.41% 8.41% 12.31% Lakeland Bancorp Lakeland Bank Lakeland Bancorp Lakeland Bank March 31, 2018 March 31, 2019 March 31, 2020 March 31, 2018 March 31, 2019 March 31, 2020 18
Dividend History Cash Dividends Per Share $0.49 CAGR: 10.7% $0.45 $0.40 $0.37 $0.33 $0.29 $0.27 $0.24 5.0% 5.0% Stock Dividends 2012 2013 2014 2015 2016 2017 2018 2019 19Dividend History Cash Dividends Per Share $0.49 CAGR: 10.7% $0.45 $0.40 $0.37 $0.33 $0.29 $0.27 $0.24 5.0% 5.0% Stock Dividends 2012 2013 2014 2015 2016 2017 2018 2019 19
LBAI Executive Summary We are proud to be characterized as follows: Industry Recognition Conservative Culture and Operating Philosophy Recognized by Forbes as the Best Bank in Relationship-based community bank New Jersey in 2019 Track record of successful acquisitions and Recognized as one of the 50 fastest growing consistent organic growth companies by NJ Biz in 2018 & 2019 Conduct business with transparency, honesty Positive Stock Performance and integrity Annual increase in dividends Robust risk management infrastructure Above Peer-Level Performance Metrics Conservatively underwritten loan and lease portfolio Core Profitability metrics: ROA, ROE, NIM, and efficiency ratio exceed peer averages as of Diligent attention to capital management; December 31, 2019 mindful of all constituencies Continued growth in net income and EPS Dedicated and Experienced Management Team and Board Stable low efficiency ratio In January 2020, Brian Gragnolati, CEO of Premier NJ Deposit Franchise Atlantic Health Systems appointed to Board of Singular focus on high quality core deposits Directors 22% of deposits in DDA, 80% in core (non- Extensive in-market experience with deep time) deposits community ties Expanded depth of Management Team with larger bank experience 20LBAI Executive Summary We are proud to be characterized as follows: Industry Recognition Conservative Culture and Operating Philosophy Recognized by Forbes as the Best Bank in Relationship-based community bank New Jersey in 2019 Track record of successful acquisitions and Recognized as one of the 50 fastest growing consistent organic growth companies by NJ Biz in 2018 & 2019 Conduct business with transparency, honesty Positive Stock Performance and integrity Annual increase in dividends Robust risk management infrastructure Above Peer-Level Performance Metrics Conservatively underwritten loan and lease portfolio Core Profitability metrics: ROA, ROE, NIM, and efficiency ratio exceed peer averages as of Diligent attention to capital management; December 31, 2019 mindful of all constituencies Continued growth in net income and EPS Dedicated and Experienced Management Team and Board Stable low efficiency ratio In January 2020, Brian Gragnolati, CEO of Premier NJ Deposit Franchise Atlantic Health Systems appointed to Board of Singular focus on high quality core deposits Directors 22% of deposits in DDA, 80% in core (non- Extensive in-market experience with deep time) deposits community ties Expanded depth of Management Team with larger bank experience 20
250 Oak Ridge Road | Oak Ridge, NJ 07438 | t: 973-697-2000 | LakelandBank.com | Stock symbol: LBAI250 Oak Ridge Road | Oak Ridge, NJ 07438 | t: 973-697-2000 | LakelandBank.com | Stock symbol: LBAI