Attached files
| file | filename |
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| 8-K - FORM 8-K - STERLING BANCORP | d284397d8k.htm |
| EX-99.1 - PRESS RELEASE DATED JANUARY 18, 2012 - STERLING BANCORP | d284397dex991.htm |
 Strategic Growth Initiative in NYC:
Acquisition of Gotham Bank of New York
Investor Presentation
Exhibit 99.2
January 18, 2012 |
 Disclaimer
We make forward-looking statements in this presentation including, but not
limited to, statements related to the price, timing and strategic and
financial benefits of the pending transaction with Gotham Bank, as well as future expense savings, future
synergies, and other future financial or business performance, conditions,
strategies, expectations or goals. All statements that are not
descriptions of historical facts are forward-looking statements, based on management’s estimates, assumptions
and projections that are subject to risks and uncertainties. These statements
can generally be identified by the use of forward-looking terminology
such as “believes,” “expects,”
“intends,”
“may,”
“will,”
“should,”
or “anticipates”
or similar
terminology.
Actual results could differ materially from those currently anticipated due to a
number of factors, including among other things: uncertainties as to
whether or when our anticipated Gotham Bank acquisition will be consummated; Provident
Bank’s success in implementing its strategic, financial and operational
initiatives and in successfully executing the Gotham Bank acquisition,
including the ability to timely and fully realize contemplated cost savings and revenues, extent of customer
retention and generation, and difficulties in integrating operations within the
periods, to the degree and at the cost anticipated; costs and availability
of financing on favorable terms and future capital needs; and uncertainties associated with
regulatory policies and approvals.
There are a number of additional important factors described in documents filed by
the Provident New York Bancorp with the Securities and Exchange Commission
and other factors that could cause our actual results to differ materially from those
contemplated by such forward-looking statements. We undertake no obligation to
publicly release the results of any revisions to those forward-looking
statements which may be made to reflect events or circumstances after the date of this
release or to reflect the occurrence of unanticipated events. You should not place
undue reliance on our forward-looking statements, which apply only as of
the date of this presentation. 1 |
 Transaction Overview
The acquisition of Gotham Bank of New York provides a strategic expansion into the
metro New York City market and provides a strong platform to grow our middle
market business through both organic growth and M&A opportunities.
Gotham Bank is a one branch business bank in NYC with $169 million of loans and
$335 million of deposits (as of September 30, 2011). Gotham Bank is
conservatively managed with strong credit quality.
Initiates the new Provident strategy in NYC in conjunction with the hiring of David
Bagatelle and the deployment of middle-market banking teams.
Platform includes a core asset and deposit base, a long-term
client
base,
advantageous
location
in
midtown
Manhattan
and
an
initial
legacy
client
relationship team.
Provides
access
to
the
lucrative
NYC
market
and
the
potential
to
leverage
existing
clients
and
gain
market positioning.
Attractive transaction economics: immediately accretive to earnings per share,
limited dilution to tangible book value, earnback in 3 years and strong pro
forma capital levels to support the growth strategy.
Good fit with the long term overall strategic plans of Provident.
2 |
 Transaction Pricing & Structure
Merger consideration: 125% of adjusted tangible net worth near closing. As of
9/30/11, tangible net worth at Gotham Bank was $31.5 million.
Core
deposit
premium
estimated
to
be
approximately
3.3%
based
on
forecasted
pro
forma
numbers
at closing.
100% cash consideration.
Seller stock options: settled in cash to the extent unexercised.
Seller cash dividends: payable in ordinary course of business.
Termination fee payable by Gotham Bank: $2 million.
Anticipated Closing Date: Third Quarter.
3 |
 Transaction Economics
Immediately accretive to earnings per share, excluding one-time transaction
costs. Tangible book value dilution of 5% at closing. Pro forma TBV
dilution earned back in 3 years versus Provident’s estimated standalone
TBV. Targeted pro forma capital level greater than 8% (TCE / TA) at
closing. Expected cost savings in excess of 40%. Ability to leverage
expense base as growth strategy accelerates.
Targeted pro forma efficiency ratio in the lower 60%-range.
Note:
Provident
EPS
forecasts
based
on
FactSet
median
estimates
of
$0.37
for
FY
2012
and
$0.47
for
FY
2013.
The
use
of
FactSet
numbers
is
for
illustrative purposes only; Provident does not adopt these estimates for any other
purpose. 4 |
 Jumbo Time
28%
Non-Interest
Bearing
23%
Brokered
21%
MMDA and
Savings
20%
Retail Time
8%
Total Deposits (9/30/11): $335M
Commercial &
Industrial
49%
Commercial
Real Estate
33%
Residential
Mortgage
8.5%
Multi-Family
7%
Construction /
Development
2%
Other
0.5%
Gross Loans (9/30/11): $169M
Strategic Rationale: Market-Entry Platform
Background on Gotham Bank
Branch Location in Midtown Manhattan
Loan Composition
Deposit Composition
New York state-chartered and Fed member
banking corporation established in 1980.
Thirty-year track record of profitability,
conservative management and strong credit
quality.
Strong deposit franchise with approximately
65% core deposits.
Robust C&I platform with strong growth
potential and strong client relationships.
Advantageous location in midtown Manhattan.
5 |
 Focused Business Strategy
Gotham
Bank
is
a
healthy,
sound
institution
that
will
serve
as
a
platform
to
complement
Provident’s
expansion in the Greater New York metro area.
Grow organically through Provident’s team-based delivery model.
Continue to focus on opportunistic, strategic acquisitions.
Goal is to create the premier relationship-based business bank in the New York
Metropolitan area. David Bagatelle and his banking teams will lead our growth
strategy in the Greater New York metro area.
Mr. Bagatelle was the Primary Founder, President and CEO of Herald National Bank
and Co-Founder and EVP of Signature Bank NY, two start-up New York
middle market banks. Prior to that, he was a senior executive at
Republic National Bank. Provident plans to hire 3 to 5 NYC-based banking
teams which will be teamed up with the legacy Gotham relationship team to
create a leading middle-market franchise. 6
|
 Pro
Forma Branch Map Provident Bank
Gotham Bank
7 |
 Pro
Forma Loan Composition 8
Commercial
Real Estate
35%
Residential
Mortgage
26%
Commercial &
Industrial
12%
Construction /
Development
10%
Home Equity
10%
Other
1%
Multi
-Family
6%
Gross Loans (9/30/11): $1.7B
Commercial &
Industrial
49%
Commercial
Real Estate
33%
Residential
Mortgage
8.5%
Multi-Family
7%
Construction /
Development
2%
Other
0.5%
Gross Loans (9/30/11): $169M
Gotham Bank
Provident Bank
Pro Forma
Commercial
Real Estate
35%
Residential
Mortgage
24%
Commercial &
Industrial
15.5%
Construction /
Development
10%
Home Equity
9%
Other
0.5%
Multi-Family
6%
Gross Loans (Pro Forma): $1.9B |
 Pro
Forma Deposit Composition 9
MMDA and
Savings
58%
Non-Interest
Bearing
28%
Retail Time
10%
Jumbo Time
3%
Brokered
1%
Total Deposits (9/30/11): $2.3B
Jumbo Time
28%
Non-Interest
Bearing
23%
Brokered
21%
MMDA and
Savings
20%
Retail Time
8%
Total Deposits (9/30/11): $335M
Gotham Bank
Provident Bank
Pro Forma
MMDA and
Savings
53%
Non-Interest
Bearing
28%
Retail Time
9%
Jumbo Time
7%
Brokered
3%
Total Deposits (Pro Forma): $2.6B |
 Summary & the Path Forward
Gotham Bank will serve as Provident’s market-entry vehicle in New York
City and the initial base for our growth strategy in this market along with
the hiring of David Bagatelle and his NYC-based relationship banking
teams. Gotham has a record of profitability, conservative management and
solid credit quality. Attractive transaction economics: core deposit premium
of approximately 3.3% at closing, immediately accretive to earnings per
share and limited tangible book value dilution with earnback in 3 years.
Focused business strategy in the Greater New York metro area, utilizing
Provident’s proven team- based relationship delivery model.
Provident
will
use
Gotham
as
the
base
for
acquisition
of
banking
teams
and
growth
of
the
middle
market segment in New York City.
10 |
 Advisors to Parties
Provident New York Bancorp:
Legal: Arnold & Porter LLP
Financial: Endicott Financial Advisors, L.L.C.
Gotham Bank of New York:
Legal: Davis Polk & Wardwell LLP
Financial: Lutz Advisors Inc.
11 |