Attached files
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| EX-99.2 - EX-99.2 - FINANCIAL INSTITUTIONS INC | d90669dex992.htm |
| 8-K - FORM 8-K - FINANCIAL INSTITUTIONS INC | d90669d8k.htm |
 NASDAQ: FISI November 30, 2015 Courier Capital Wealth Management Acquisition Exhibit 99.1 |
 Forward Looking Statements 2 Statements contained in this presentation which are not historical facts and which pertain to future operating results of Financial Institutions, Inc. and its subsidiaries constitute forward-looking statements as defined by Section 21E of the Securities Exchange Act of 1934, as amended, that involve significant risks and uncertainties. Statements herein are based on certain assumptions and analyses by the Company and are factors it believes are appropriate in the circumstances. Actual results could differ materially from those contained in or implied by such statements for a variety of reasons including, but not limited to: Courier’s financial results after the acquisition being significantly different than its historical results or the Company’s internal projections; Courier’s historical financial results being inaccurate or materially different once prepared in accordance with GAAP; changes in interest rates; changes in accounting principles, policies, or guidelines; changes in the Company’s dividend policy; significant changes in the economic scenario: significant changes in regulatory requirements; unforeseen difficulties in integrating Courier with the Company; and significant changes in securities markets. Consequently, all forward-looking statements made herein are qualified by these cautionary statements and the cautionary language in the Company’s Annual Report on Form 10-K, its Quarterly Reports on Form 10-Q and other documents filed with the SEC. Except as required by law, the Company undertakes no obligation to update any information presented herein. |
 Growing and Diversifying Noninterest Income 3 Courier Capital Platform Acquisition – Wealth Management Services Acquisition (pending closing conditions) of leading SEC-registered investment advisory and wealth management
firm based in western New York with
operations in Buffalo and Jamestown Founded
in 1967; presently has over 1,100 individual, business, institutional, foundation, and retirement plan clients; more than $1.2 billion in assets under management and advisor to an additional $335 million of assets
Entire management and staff to remain; strong leadership
team with vast investment experience: Bruce Kaz (30 years), William Gurney (27 years), Randy Ordines (28 years) and Thomas Hanlon (27 years)
Named to the Financial Times FT 300 Top Financial
Advisers list in each of the past two years since the ranking established; ranking based on assets under management, asset growth rate, years in existence, compliance record,
industry certifications, and online
accessibility Raises profile of entire
Company in its markets and establishes another platform for expanded diversified financial services to further reduce reliance on our net interest margin business; potential for cross-selling activities and
bolt on acquisitions of other regional
firms Approximately $3.4 million in
revenues and $1.4 million in Earnings Before Interest, Taxes, Depreciation and Amortization (“EBITDA”)* for 2014, based on figures provided to the Company by Courier Capital. These financial
results were not audited and were compiled
on a cash accounting basis and not in compliance with GAAP. Acquisition of Platform Wealth Management Firm Aligned with FISI’s Growth Strategy
Diversifies non interest income with new fee-based
services Addition of commercial
customers/revenues Universal application
enhancing multiple business lines Enables
cross-selling and customer enhancement opportunities * See Appendix for the computation of this Non-GAAP measure. |
 Courier Capital – Financial Considerations Merger consideration worth $9.0 million (approximately 90% payable in FISI common
stock) at closing (subject to certain adjustments), with
additional contingent consideration (also
payable primarily in FISI common stock) expected between $2.3 million and $5.0 million based on achieving a three year compounded annual growth rate
in EBITDA* ranging between 9% and 14%,
respectively Purchase price of 8.3x 2014
EBITDA* compares favorably to other deals in sector Acquisition is expected to be moderately accretive to earnings in 2016 with an IRR in
excess of 15%
Estimated Tangible Common Book Value (“TCBV”)*
per share dilution of approximately 4.4%
at closing and expected earn-back of 7 years is within our acceptable range for the acquisition of a fee-based business platform
Deal is structured as a tax-free reorganization
which requires the recording of a deferred
tax liability on the separately identifiable intangible
assets and corresponding increase to
goodwill of approximately $1.3 million, resulting in a
relatively longer earn-back period
Inherently longer TCBV earn-back is balanced by a
reasonable level of expected TCBV
dilution, the positive impact on current and future
growth of earnings, and diversification of
our revenue 4
* See Appendix for the computation of this Non-GAAP
measure. |
 FISI’s Evolving Growth Profile 2013: Strategic growth plan developed and implemented by new Company leadership
Two key elements of plan: Diversify revenue base by increasing noninterest income through fee-based services; new services should be
aligned with core banking business and
mission to improve experience for customers
Leverage 200 years of rural NY banking to enter
opportunity rich markets of Rochester and Buffalo 2014: Insurance -- acquisition of Scott Danahy Naylon Co., Inc., a full service insurance agency based near Buffalo, as platform for entry into broad line insurance services. Integrate and develop
platform in 2015; focus on
organic/acquisition growth of business in 2016
2015:
Wealth
Management
--
acquisition
of
Courier
Capital,
a
leading
SEC-registered
investment advisory based bear Buffalo, as platform for
entry into wealth management. Integrate
and develop the platform in 2016; focus on
organic/acquisition growth in 2016 and beyond
2015/2016: Banking
--
core bank operations expanding in major regional MSAs
with 2 branch openings slated for
Rochester region (November 2015 and 1Q 2016); driving forward with new “Made for You: branch concept with cross-trained staff working closer with customers
Our
“DNA”
as
a
relationship
oriented
bank
that
values
personal
attention
for
retail
and
business
customers
is
a
competitive
advantage
in
a
rising
interest
rate
environment
and
within
a
region
experiencing consolidation; Growth complemented by
addition of fee-based services 5
|
 NASDAQ: FISI 6 Appendix |
 Non-GAAP to GAAP Reconciliation 7 September 30, 2015 Actual Adjustments Pro Forma Tangible Common Book Value: Common shareholders’ equity $ 278,094
$
8,100
$
286,194 Less: Goodwill and other
intangible assets, net 67,925
12,600
80,525
Tangible common equity (non-GAAP)
$ 210,169
$ 205,669
Common shares outstanding
14,189
311
14,500
Tangible common book value per share
(non-GAAP) (1)
$
14.81
$
14.18 (1)
Tangible common equity divided by common shares
outstanding. EBITDA:
2014 EBITDA for Courier Capital was calculated by adding
back $3 thousand of depreciation expense to net income. Courier Capital did not report any interest expense, income tax expense or amortization during 2014.
|