Investor presentation TRISTATE CAPITAL HOLDINGS, INC. (NASDAQ: TSC) Third quarter ended September 30, 2019
Important Information About this presentation Financial information and data: Unless noted otherwise herein, income statement data is for the trailing twelve-months ended September 30, 2019, compared to the same TTM period the year prior; and balance sheet data is as of September 30, 2019, compared to one year prior. Forward looking statements: This presentation may contain “forward-looking” statements. Such forward-looking statements are subject to risks that could cause actual results or outcomes to differ materially from those currently anticipated. TriState Capital has no duty to, and does not intend to, update or revise forward-looking statements after the date on which they are made. For further information about the factors that could affect TriState Capital’s future results, please see the company’s most recent annual and quarterly reports filed on Form 10-K and Form 10-Q. Non-GAAP measures: To the extent non-GAAP financial measures are presented herein, comparable GAAP measures and reconciliations can be found in TriState Capital’s most recent quarterly financial results news release. 2 Investor presentation
Three Businesses Drive Differentiated Growth Sophistication of a super regional financial firm with the high touch of a boutique firm Private Banking Investment Management Commercial Banking NATIONAL NATIONAL PA, NY, NJ & OH Organic growth Organic & acquisitive growth Organic growth Low capital requirements Low capital requirements Traditional capital requirements Self-funding liquidity management Relationship-driven liquidity and treasury management funding 3 Investor presentation
Three Businesses Drive Differentiated Growth For the trailing twelve-months and period ending September 30, 2019 Growth in net income available 13% to common stockholders Asset quality Operating leverage LIBOR neutral balance sheet 11% Total revenue growth 28% 21% 24% Private banking Investment management fee Commercial loan growth contribution to total revenue loan growth 4 Investor presentation
Unique Model Sophisticated, high-touch, client-focused approach to financial services positions us to do well while empowering our clients to do well 29% of revenue from non-interest income 14% organic NII growth YOY driven through lower credit risk and variable rate loans 26% organic loan growth YOY 28% organic deposit growth YOY enhanced by lower cost funding with treasury management 92% of loans and 26% of debt securities variable rate 53.94% YTD Bank efficiency ratio ~$666k quarterly revenue/FTE, annualized ~18% insider ownership 0 branches 5 Investor presentation
Strong Foundation for Future Growth since 2013 IPO illustrates the strength and effectiveness of strategy % Change 9/30/2019 3/31/2013 since IPO (Dollars in Thousands) Among Fortune’s 100 Assets $ 7,198,449 $ 2,074,287 247% Fastest-Growing Companies Total revenue (TTM) $ 174,119 $ 63,548 174% Net interest income $ 123,523 $ 58,487 111% Ranked by Fortune1 in 2019 for (TTM) Non-interest income 3rd consecutive year based on: $ 50,596 $ 5,061 900% (TTM) • 33% growth in EPS Income before tax $ 68,333 $ 17,629 288% • 29% growth in revenue (TTM) • 16% total return EPS2 (TTM) $ 1.95 $ 0.48 306% on a three-year annualized basis 1 The September 2019 issue of Fortune reported that it ranks the 100 Fastest-Growing Companies listed on major U.S. stock exchanges by "revenue growth rate, EPS growth rate, and total return for the period ended June 29, 2019 on a three-year annualized. (To compute the revenue and EPS growth rates, Fortune uses a trailing-four-quarters log linear least square regression fit.)." 2 Fully diluted earnings per share. 6 Investor presentation
DOUBLE -DIGIT EPS GROWTH $2.20 $2.00 $1.95 $1.81 $1.80 CAGR Record of Growth $1.60 35% $1.40 $1.32 Double-digit YOY EPS growth for $1.20 $1.01 22 of 26 quarters $1.00 $0.80 $0.80 $0.60 $0.55 $0.40 2014 2015 2016 2017 2018 TTM 3Q19 7 Investor presentation
2019 Financial Performance Goals Aimed at sustaining record of double-digit earnings growth over long term Grow pre-tax Organically grow Grow treasury Surpass $7B in income at a double- loans at a management bank assets digit pace of double-digit pace deposit accounts by 15%–25% of 15%–25% $500 million Surpass $15B in AUM Drive operating leverage Maintain strong credit at Chartwell through revenue growth and quality metrics Through a combination of disciplined expense Continuing to distinguish us by organic and inorganic growth driving peer leading risk management adjusted returns Maintaining bank efficiency ratio in the low 50s while limiting annual operating expense growth to a single-digit rate 8 Investor presentation
Operating Leverage Driven by revenue growth, exceptional client focus, scalable model and prudent management, which enables sophisticated client experience, agility and efficiency SUPERIOR REVENUE / EMPLOYEE $650,000 Unique branchless model $600,000 276 FTEs Highly experienced and high-performing team $550,000 $500,000 2014 2015 2016 2017 2018 3Q19 Annualized* 53.94% YTD bank efficiency ratio compared to 52.55% in prior year period *Revenue per employee was ~$666,000 in 3Q19, more than twice that of our peer median1 1 Peer data for bank holding companies with $5B-$10B in MRQ assets. Analysis of net interest income plus non-interest income, annualized, divided by period-end FTE employees based on data from S&P Global Market Intelligence. 9 Investor presentation
Private Banking TSC's fastest-growing channel for lending and part of its integrated advisor solutions strategy PRIVATE BANKING LOANS $4.0 Loans over-collateralized by marketable securities or cash value life insurance $3.5 $3.368 (CVLI) policies are monitored utilizing the bank’s proprietary technology $3.0 $2.870 CAGR • No loss history $2.5 31% $2.266 s n o i l $2.0 l Favorable regulatory capital treatment i B $1.736 given reduced risk weighting enhances $1.5 capital efficiency $1.345 $0.989 $1.0 Marketable securities collateral consist of liquid and primarily well-diversified $0.5 portfolios $0.0 2014 2015 2016 2017 2018 3Q19 % of Total Loans 41.2% 47.3% 51.0% 54.1% 55.9% 56.0% 10 Investor presentation
Private Banking The Opportunity Aimed at assisting financial advisors of all types provide enhanced value to their clients Deep relationships with 207 broker-dealers, regional securities firms, RIAs, family offices and trust companies that do not offer banking services themselves These platforms enhance TSC's network of 50,000+ independent financial advisors, trust officers and family office executives seeking to add value for their clients Private banking loans prove attractive to the fast-growing numbers of financial advisors moving from wire houses to independent platforms <35% High net worth Loans to HNW Median LTV individuals, trusts and individuals used for of these businesses any purpose (except to outstanding loans purchase securities) 11 Investor presentation
Advisor Solutions Continually innovating to be leading, trusted and essential partner Responding to advisors' focus on creating a holistic experience and enhanced value proposition for their Securities- clients by: Based Private • Complementing advisors' capabilities with Bank Lending Future unique and essential products and services Services which can be integrated into their environments • Customizing technology, including digital Financial lending platform, and in-person delivery to Chartwell's Treasury meet their needs and clients' expectations Niche Advisors Management Investment and their Services • Optimizing risk management and Products Clients monitoring through smart and scalable proprietary collateral monitoring system Future • Respecting their relationships by supporting, Products and not competing with, them Premium Cash Management 12 Investor presentation
ORGANIC, IN-MARKET COMMERCIAL LOAN GROWTH $3.0 $2.649 $2.5 CAGR Middle-Market 13% $2.263 Commercial $2.0 $1.919 $1.665 s Banking n $1.496 o i l $1.5 $1.410 l i Four-state Mid-Atlantic footprint B $1.0 commercial loan $0.5 24% growth YOY $0.0 2014 2015 2016 2017 2018 3Q19 C&I CRE: owner-occupied CRE: non-owner occupied 13 Investor presentation
Middle-Market Commercial Banking In-market relationships diversified across industries, property type and geographies Highly experienced in-market regional presidents and relationship managers, with 21+ years average experience, source and serve local clients through our Mid-Atlantic representative offices 23% 52% 12% 45% 23% 15% COMMERCIAL C&I LOANS CRE LOANS LOANS BY $993M $1.66B 26% REGION $2.65B 19% 8% 18% 4% 18% 17% 20% Income-producing Owner-occupied Service Real estate Western PA Eastern PA Multifamily/apartment Construction/land Manufacturing Transportation Ohio New Jersey All others NYC 14 Investor presentation
Superior Credit Quality Drives consistently low annual credit costs ALLOWANCE / NPLs NPLs / TOTAL LOANS 8,000% 7,268.5% 1.5% $6 1.26% 7,000% $5 6,000% 1.0% $4 5,000% s n o i 4,000% $3 l 0.59% l 0.52% i 3,000% B 0.5% $2 2,000% 1,000% 452.9% 590.4% 0.08% $1 67.1% 107.9% 105.5% 0.04% —% 0% 0.0% $0 2014 2015 2016 2017 2018 3Q19 2014 2015 2016 2017 2018 3Q19 Total Loans NCOs / AVERAGE LOANS 0.6% 0.4% NPLs / Total Loans 0.41% 0.0% 0.2% 0.09% 0.10% —% 0.02% —% 0.0% -0.2% 2014 2015 2016 2017 2018 3Q19 US Bank Aggregate NCOs / Avg Loans 15 Investor presentation
Organic Deposit Growth DIVERSE AND HIGH-QUALITY DEPOSIT FRANCHISE World class financial institutions and national deposit team $6 3.0% Treasury management $5 2.5% capabilities and team enhanced 2.27% $4 2.0% in 2016 2.02% s n o i Enhanced capabilities to serve l $3 1.5% l i family offices and ultra high net B worth clients in 2018 $2 1.0% 0.49% $1 0.5% of deposits are 0.17% 21% fixed-rate CDs $0 0.0% 2014 2015 2016 2017 2018 3Q19 Annualized 1-Month LIBOR1 Average Cost of Deposits Certificates of Deposit Money Market Deposits Noninterest and Interest Checking 1 1-Month London Interbank Offered Rate (LIBOR), based on U.S. dollar, percent. daily, not seasonally adjusted. 16 Investor presentation
Treasury Management a Strategic Priority Investments in best-in-class technology and talent beginning in 2016 are paying off for our clients and our business TREASURY MANAGEMENT DEPOSIT ACCOUNTS Treasury management deposits are up approximately 75% year-to-date $1,200 $1,053.1 $978.5 $1,000 12 dedicated professionals across regional footprint $789.8 $800 s More than 500 clients and growing, including n $603.3 o i l l $600 i deposit-only clients with essential need for M treasury management services $400 $200 $0 12/31/18 03/31/19 06/30/19 09/30/19 17 Investor presentation
Treasury Management Deposits Sophisticated and high touch service combined with transparent fee structures driving growth with existing clients and rapid expansion of new clients Commercial Operating C&I Non-Lending 16% Banks 5% Funds, Custody, 14% Trusts 8% Real Estate 1% 3% BALANCES OF Non-Profit 2% $1.05B Financial Intermediaries 13% Family Offices & 31% Foundations 5% Payment Processors Service Providers 0.4% Other 18 Investor presentation
Chartwell Investment management fees provide significant income diversification Leveraging TSC's distribution network CHARTWELL REVENUE AND EBITDA and expertise to grow Chartwell Investment Partners' AUM $50 Enhancing institutional inflows while $40 $37.0 $37.1 $37.6 $36.8 maintaining strong retail momentum $29.6 $30 s • Retail up to 26% in MRQ from n o i l l i 8% when Chartwell was acquired M $20 in 2014 $13.2 $8.5 $10 $7.4 $6.9 $7.0 12% Institutional $0 14% Subadvisory 2015 2016* 2017 2018* TTM 3Q19* $9.62B AUM Mutual Funds 7% Revenue EBITDA 67% Managed Accounts * EBITDA reflects change in the fair value of acquisition earnout in the period. 19 Investor presentation
Chartwell Offers strategies not easily replicated by passive products AUM of $9.62B up 21% since TSC acquired Chartwell in 2014 strategies outperforming respective 9 benchmarks for 3 and 5 years Growth driven by superior investment performance Small Cap Value Mid Cap Value Smid Cap Value Dividend Value 13% 22% Value Equity Covered Call Short Duration BB-Rated High Yield Fixed Income Growth Equity AUM BY Intermediate High Grade Fixed Income INVESTMENT 4% Balanced Core High Grade Fixed Income TEAM 12% Fixed Income Core Plus Fixed Income 49% Large Cap Large Cap Growth Small Cap Growth Berwyn Income Fund High Yield Fixed Income Short Duration High Grade Corporate 20 Investor presentation
Capital and Investment Profile History of deploying capital in accretive acquisitions while organically growing balance sheet Deployed $66M raised in 2013 IPO Investment Profile2 (last common equity raise) in three accretive investment management Closing Price $ 22.49 acquisitions1 while organically growing 52-Week High $ 26.63 bank’s balance sheet by more than $4B 52-Week Low $ 18.20 Raised net capital of $116M in Common Shares Outstanding 29.3M 2018-2019 offerings of non-cumulative Float 24.1M perpetual preferred stock, providing additional Tier 1 capital for the holding Average Daily Volume (3 mos.) ~109,000 company Insider Ownership ~18% Repurchased 2.1M shares since 4Q14 for $32.5M (~$15.38 per share) 1 Chartwell acquisition closed 3/5/2014, TKG acquisition closed 4/29/2016, and Columbia acquisition closed 4/6/2018. 2 Market data as of October 17, 2019. 21 Investor presentation
appendix 22 Investor presentation
Key Performance Ratios As of and For the As of and For the Three Months Ended Years Ended (Dollars in thousands) September 30, June 30, March 31, December 31, September 30, December 31, December 31, 2019 2019 2019 2018 2018 2018 2017 Performance ratios: Return on average assets (1) 0.94% 0.91% 0.97 % 1.04 % 1.06% 1.04% 0.89% Return on average common equity (2) 11.82% 11.63% 12.50 % 13.16 % 12.78% 12.57% 10.30% Net interest margin 1.94% 2.03% 2.10 % 2.12 % 2.22% 2.26% 2.25% Total revenue $ 46,353 $ 43,170 $ 43,413 $ 41,183 $ 41,570 $ 161,391 $ 138,009 Pre-tax, pre-provision net revenue $ 18,580 $ 15,585 $ 16,741 $ 14,880 $ 15,884 $ 60,234 $ 46,537 Bank efficiency ratio 50.70% 55.16% 56.30 % 54.60 % 52.86% 53.09% 57.39% Non-interest expense to average assets 1.59% 1.71% 1.77 % 1.81 % 1.90% 1.93% 2.15% Asset quality: Non-performing loans $ 184 $ 2,189 $ 7,329 $ 2,237 $ 2,269 $ 2,237 $ 3,183 Non-performing assets $ 4,434 $ 5,213 $ 10,453 $ 5,661 $ 5,845 $ 5,661 $ 6,759 Other real estate owned $ 4,250 $ 3,024 $ 3,124 $ 3,424 $ 3,576 $ 3,424 $ 3,576 Non-performing assets to total assets 0.06% 0.08% 0.16 % 0.09 % 0.10% 0.09% 0.14% Non-performing loans to total loan —% 0.04% 0.14 % 0.04 % 0.05% 0.04% 0.08% Allowance for loan and lease losses to loans 0.22% 0.25% 0.28 % 0.26 % 0.29% 0.26% 0.34% Allowance for loan and lease losses to non- performing loans 7,268.48% 640.29% 200.74 % 590.43 % 598.63% 590.43% 452.94% Net charge-offs (recoveries) $ 35 $ (16) $ (1,881) $ (206) $ 1,504 $ 1,004 $ 3,722 Net charge-offs (recoveries) to average total loans —% —% (0.15)% (0.02)% 0.13% 0.02% 0.10% Investment management segment: Assets under management $ 9,615,000 $ 9,485,000 $ 9,732,000 $ 9,189,000 $ 9,865,000 $ 9,189,000 $ 8,309,000 EBITDA $ 932 $ 1,557 $ 2,621 $ 1,890 $ 1,867 $ 6,900 $ 7,421 (1) Net income divided by total average assets. (2) Net income available to common shareholders divided by average common equity. 23 Investor presentation
Income Statement For the Three Months Ended For the Years Ended (Dollars in thousands, except per share data) September 30, June 30, March 31, December 31, September 30, December 31, December 31, 2019 2019 2019 2018 2018 2018 2017 Income statement data: Interest income $ 67,732 $ 66,339 $ 62,902 $ 58,162 $ 52,424 $ 199,786 $ 134,295 Interest expense 35,416 35,036 32,530 28,630 23,605 86,382 42,942 Net interest income 32,316 31,303 30,372 29,532 28,819 113,404 91,353 Provision (credit) for loan and lease losses (607) (712) (377) (581) (234) (205) (623) Net interest income after provision for loan and lease losses 32,923 32,015 30,749 30,113 29,053 113,609 91,976 Non-interest income: Investment management fees 8,902 9,254 9,424 9,225 9,828 37,647 37,100 Net gain (loss) on the sale and call of debt securities 206 112 28 (76) — (70) 310 Other non-interest income 5,135 2,613 3,617 2,426 2,923 10,340 9,556 Total non-interest income 14,243 11,979 13,069 11,575 12,751 47,917 46,966 Non-interest expense: Intangible amortization expense 502 502 502 503 502 1,968 1,851 Change in fair value of acquisition earn out — — — (218) — (218) — Other non-interest expense 27,271 27,083 26,170 26,018 25,184 99,407 89,621 Total non-interest expense 27,773 27,585 26,672 26,303 25,686 101,157 91,472 Income before tax 19,393 16,409 17,146 15,385 16,118 60,369 47,470 Income tax expense 3,059 1,718 2,582 265 1,807 5,945 9,482 Net income $ 16,334 $ 14,691 $ 14,564 $ 15,120 $ 14,311 $ 54,424 $ 37,988 Preferred stock dividends 1,962 1,150 679 679 679 2,120 — Net income available to common shareholders $ 14,372 $ 13,541 $ 13,885 $ 14,441 $ 13,632 $ 52,304 $ 37,988 Earnings per common share: Basic $ 0.52 $ 0.49 $ 0.50 $ 0.52 $ 0.49 $ 1.90 $ 1.38 Diluted $ 0.50 $ 0.47 $ 0.48 $ 0.50 $ 0.47 $ 1.81 $ 1.32 24 Investor presentation
Period-End Balance Sheet As of (Dollars in thousands) September 30, June 30, March 31, December 31, September 30, 2019 2019 2019 2018 2018 Period-end balance sheet data: Cash and cash equivalents $ 383,948 $ 458,269 $ 243,911 $ 189,985 $ 186,535 Total investment securities 468,721 431,426 487,087 466,759 393,139 Loans and leases held-for-investment 6,016,680 5,664,934 5,336,725 5,132,873 4,758,356 Allowance for loan and lease losses (13,374) (14,016) (14,712) (13,208) (13,583) Loans and leases held-for-investment, net 6,003,306 5,650,918 5,322,013 5,119,665 4,744,773 Goodwill and other intangibles, net 66,357 66,859 67,361 67,863 68,365 Other assets 276,117 238,531 223,638 191,383 180,476 Total assets $ 7,198,449 $ 6,846,003 $ 6,344,010 $ 6,035,655 $ 5,573,288 Deposits $ 6,094,605 $ 5,786,983 $ 5,337,704 $ 5,050,461 $ 4,754,588 Borrowings, net 330,000 335,000 398,216 404,166 262,365 Other liabilities 169,337 135,039 111,533 101,674 88,715 Total liabilities 6,593,942 6,257,022 5,847,453 5,556,301 5,105,668 Preferred stock 116,064 116,142 38,468 38,468 38,468 Common shareholders' equity 488,443 472,839 458,089 440,886 429,152 Total shareholders' equity 604,507 588,981 496,557 479,354 467,620 Total liabilities and shareholders' equity $ 7,198,449 $ 6,846,003 $ 6,344,010 $ 6,035,655 $ 5,573,288 25 Investor presentation
Capital Ratios As of September 30, June 30, March 31, December 31, September 30, 2019 2019 2019 2018 2018 TSCH capital ratios: Tier 1 leverage ratio 7.91 % 8.21 % 7.13 % 7.28 % 7.53 % Common equity tier 1 risk-based capital ratio 9.58 % 9.83 % 9.98 % 9.64 % 10.52 % Tier 1 risk-based capital ratio 12.15 % 12.56 % 10.92 % 10.58 % 11.57 % Total risk-based capital ratio 12.40 % 12.82 % 11.26 % 10.86 % 11.89 % TSCB capital ratios: Tier 1 leverage ratio 7.20 % 7.43 % 7.29 % 7.49 % 7.71 % Common equity tier 1 risk-based capital ratio 11.07 % 11.38 % 11.18 % 10.90 % 11.92 % Tier 1 risk-based capital ratio 11.07 % 11.38 % 11.18 % 10.90 % 11.92 % Total risk-based capital ratio 11.38 % 11.73 % 11.57 % 11.25 % 12.30 % 26 Investor presentation
Loan Composition (Dollars in thousands) As of September 30, June 30, March 31, December 31, September 30, Loan and Lease Composition 2019 2019 2019 2018 2018 Private banking $ 3,368,142 $ 3,188,668 $ 2,981,973 $ 2,869,543 $ 2,627,749 C&I 992,508 908,054 862,405 785,320 771,546 CRE 1,656,030 1,568,212 1,492,347 1,478,010 1,359,061 Loans and leases held-for-investment $ 6,016,680 $ 5,664,934 $ 5,336,725 $ 5,132,873 $ 4,758,356 Private banking 56.0% 56.3% 55.9% 55.9% 55.2% C&I 16.5% 16.0% 16.1% 15.3% 16.2% CRE 27.5% 27.7% 28.0% 28.8% 28.6% Loans and leases held-for-investment 100.0% 100.0% 100.0% 100.0% 100.0% 27 Investor presentation
Deposit Composition (Dollars in thousands) As of September 30, June 30, March 31, December 31, September 30, Deposit Composition 2019 2019 2019 2018 2018 Noninterest-bearing checking accounts $ 312,285 $ 270,435 $ 292,188 $ 258,268 $ 236,422 Interest-bearing checking accounts 1,333,189 971,081 895,948 778,131 713,833 Money market deposit accounts 3,149,346 3,021,610 2,760,147 2,781,870 2,565,561 Certificates of deposit 1,299,785 1,523,857 1,389,421 1,232,192 1,238,772 Total deposits $ 6,094,605 $ 5,786,983 $ 5,337,704 $ 5,050,461 $ 4,754,588 Noninterest-bearing checking accounts 5.1% 4.7% 5.5% 5.1% 5.0% Interest-bearing checking accounts 21.9% 16.8% 16.8% 15.4% 15.0% Money market deposit accounts 51.7% 52.2% 51.7% 55.1% 53.9% Certificates of deposit 21.3% 26.3% 26.0% 24.4% 26.1% Total deposits 100.0% 100.0% 100.0% 100.0% 100.0% 28 Investor presentation
Average Balance Sheet Three Months Ended September 30, 2019 June 30, 2019 September 30, 2018 Interest Average Interest Average Interest Average Average Income (1)/ Yield/ Average Income (1)/ Yield/ Average Income (1)/ Yield/ (Dollars in thousands) Balance Expense Rate Balance Expense Rate Balance Expense Rate Assets Interest-earning deposits $ 388,274 $ 2,144 2.19% $ 255,697 $ 1,542 2.42% $ 207,346 $ 1,015 1.94% Federal funds sold 8,424 44 2.07% 11,218 67 2.40% 9,563 46 1.91% Debt securities available-for-sale 262,665 2,085 3.15% 249,281 2,053 3.30% 236,053 1,836 3.09% Debt securities held-to-maturity 174,331 1,537 3.50% 181,495 1,712 3.78% 76,341 699 3.63% Equity securities 4,720 12 1.01% 7,701 28 1.46% 11,219 71 2.51% FHLB stock 10,585 382 14.32% 20,235 385 7.63% 11,342 314 10.98% Total loans and leases 5,776,652 61,552 4.23% 5,462,489 60,579 4.45% 4,594,755 48,470 4.19% Total interest-earning assets 6,625,651 67,756 4.06% 6,188,116 66,366 4.30% 5,146,619 52,451 4.04% Other assets 288,216 266,905 223,996 Total assets $ 6,913,867 $ 6,455,021 $ 5,370,615 Liabilities and Shareholders' Equity Interest-bearing deposits: Interest-bearing checking accounts $ 1,116,624 5,795 2.06% $ 868,721 $ 4,965 2.29% $ 657,402 $ 3,267 1.97% Money market deposit accounts 3,106,186 18,870 2.41% 2,855,795 18,200 2.56% 2,506,334 12,428 1.97% Certificates of deposit 1,462,521 9,449 2.56% 1,361,372 8,990 2.65% 1,155,888 6,487 2.23% Borrowings: FHLB borrowings 224,130 1,302 2.30% 430,770 2,334 2.17% 221,576 853 1.53% Line of credit borrowings — — —% 857 10 4.68% 1,277 16 4.97% Subordinated notes payable, net — — —% 34,984 537 6.16% 34,832 554 6.31% Total interest-bearing liabilities 5,909,461 35,416 2.38% 5,552,499 35,036 2.53% 4,577,309 23,605 2.05% Noninterest-bearing deposits 268,013 256,404 253,033 Other liabilities 137,934 113,031 78,802 Shareholders' equity 598,459 533,087 461,471 Total liabilities and shareholders' equity $ 6,913,867 $ 6,455,021 $ 5,370,615 Net interest income (1) $ 32,340 $ 31,330 $ 28,846 Net interest spread (1) 1.68% 1.77% 1.99% Net interest margin (1) 1.94% 2.03% 2.22% (1) Calculated on a fully taxable equivalent basis. 29 Investor presentation
Average Balance Sheet Years Ended December 31, 2018 2017 Interest Average Interest Average Average Income (1)/ Yield/ Average Income (1)/ Yield/ (Dollars in thousands) Balance Expense Rate Balance Expense Rate Assets Interest-earning deposits $ 188,921 $ 3,598 1.90% $ 126,888 $ 1,466 1.16% Federal funds sold 8,315 156 1.88% 6,923 68 0.98% Debt securities available-for-sale 205,652 6,195 3.01% 144,735 3,122 2.16% Debt securities held-to-maturity 90,895 3,399 3.74% 58,635 2,463 4.20% Debt securities trading — — —% 188 4 2.13% Equity securities 10,517 277 2.63% 8,539 266 3.12% FHLB stock 15,136 924 6.10% 13,286 603 4.54% Total loans and leases 4,500,117 185,349 4.12% 3,711,701 126,544 3.41% Total interest-earning assets 5,019,553 199,898 3.98% 4,070,895 134,536 3.30% Other assets 221,467 193,532 Total assets $ 5,241,020 $ 4,264,427 Liabilities and Shareholders' Equity Interest-bearing deposits: Interest-bearing checking accounts $ 612,921 $ 11,440 1.87% $ 336,337 $ 3,706 1.10% Money market deposit accounts 2,429,203 45,106 1.86% 1,999,399 22,350 1.12% Certificates of deposit 1,071,556 21,947 2.05% 967,503 11,429 1.18% Borrowings: FHLB borrowings 325,356 5,555 1.71% 295,315 3,152 1.07% Line of credit borrowings 2,568 119 4.63% 2,214 90 4.07% Subordinated notes payable, net 34,807 2,215 6.36% 34,605 2,215 6.40% Total interest-bearing liabilities 4,476,411 86,382 1.93% 3,635,373 42,942 1.18% Noninterest-bearing deposits 244,090 210,860 Other liabilities 75,473 49,279 Shareholders' equity 445,046 368,915 Total liabilities and shareholders' equity $ 5,241,020 $ 4,264,427 Net interest income (1) $ 113,516 $ 91,594 Net interest spread (1) 2.05% 2.12% Net interest margin (1) 2.26% 2.25% (1) Calculated on a fully taxable equivalent basis. 30 Investor presentation
Segments Three Months Ended September 30, 2019 Three Months Ended September 30, 2018 Investment Parent Investment Parent (Dollars in thousands) Bank Management and Other Consolidated Bank Management and Other Consolidated Income statement data: Interest income $ 67,720 $ — $ 12 $ 67,732 $ 52,354 $ — $ 70 $ 52,424 Interest expense 35,455 — (39) 35,416 23,038 — 567 23,605 Net interest income (loss) 32,265 — 51 32,316 29,316 — (497) 28,819 Provision (credit) for loan and lease losses (607) — — (607) (234) — — (234) Net interest income (loss) after provision for loan and lease losses 32,872 — 51 32,923 29,550 — (497) 29,053 Non-interest income: Investment management fees — 9,016 (114) 8,902 — 9,914 (86) 9,828 Net gain on the sale and call of debt securities 206 — — 206 — — — — Other non-interest income 5,113 (9) 31 5,135 2,850 — 73 2,923 Total non-interest income 5,319 9,007 (83) 14,243 2,850 9,914 (13) 12,751 Non-interest expense: Intangible amortization expense — 502 — 502 — 502 — 502 Other non-interest expense 18,949 8,186 136 27,271 17,002 8,173 9 25,184 Total non-interest expense 18,949 8,688 136 27,773 17,002 8,675 9 25,686 Income (loss) before tax 19,242 319 (168) 19,393 15,398 1,239 (519) 16,118 Income tax expense (benefit) 3,142 3 (86) 3,059 1,676 282 (151) 1,807 Net income (loss) $ 16,100 $ 316 $ (82) $ 16,334 $ 13,722 $ 957 $ (368) $ 14,311 31 Investor presentation
Segments Nine Months Ended September 30, 2019 Nine Months Ended September 30, 2018 Investment Parent Investment Parent (Dollars in thousands) Bank Management and Other Consolidated Bank Management and Other Consolidated Income statement data: Interest income $ 196,862 $ — $ 111 $ 196,973 $ 141,424 $ — $ 200 $ 141,624 Interest expense 101,891 — 1,091 102,982 56,027 — 1,725 57,752 Net interest income (loss) 94,971 — (980) 93,991 85,397 — (1,525) 83,872 Provision (credit) for loan and lease losses (1,696) — — (1,696) 376 — — 376 Net interest income (loss) after provision for loan and lease losses 96,667 — (980) 95,687 85,021 — (1,525) 83,496 Non-interest income: Investment management fees — 27,912 (332) 27,580 — 28,621 (199) 28,422 Net gain on the sale and call of debt securities 346 — — 346 6 — — 6 Other non-interest income 10,467 17 881 11,365 7,875 1 38 7,914 Total non-interest income 10,813 27,929 549 39,291 7,881 28,622 (161) 36,342 Non-interest expense: Intangible amortization expense — 1,506 — 1,506 — 1,465 — 1,465 Other non-interest expense 56,872 23,174 478 80,524 49,011 23,988 390 73,389 Total non-interest expense 56,872 24,680 478 82,030 49,011 25,453 390 74,854 Income (loss) before tax 50,608 3,249 (909) 52,948 43,891 3,169 (2,076) 44,984 Income tax expense (benefit) 6,825 830 (296) 7,359 5,485 786 (591) 5,680 Net income (loss) $ 43,783 $ 2,419 $ (613) $ 45,589 $ 38,406 $ 2,383 $ (1,485) $ 39,304 32 Investor presentation
Reconciliation of Non-GAAP Financial measures to GAAP Income Statement Items For the Three Months Ended For the Years Ended September 30, June 30, March 31, December 31, September 30, December 31, December 31, (Dollars in thousands) 2019 2019 2019 2018 2018 2018 2017 Total revenue: Net interest income $ 32,316 $ 31,303 $ 30,372 $ 29,532 $ 28,819 $ 113,404 $ 91,353 Total non-interest income 14,243 11,979 13,069 11,575 12,751 47,917 46,966 Less: net gain (loss) on the sale and call of debt securities 206 112 28 (76) — (70) 310 Total revenue $ 46,353 $ 43,170 $ 43,413 $ 41,183 $ 41,570 $ 161,391 $ 138,009 Less: total non-interest expense 27,773 27,585 26,672 26,303 25,686 101,157 91,472 Pre-tax, pre-provision net revenue $ 18,580 $ 15,585 $ 16,741 $ 14,880 $ 15,884 $ 60,234 $ 46,537 For the Three Months Ended For the Years Ended September 30, June 30, March 31, December 31, September 30, December 31, December 31, (Dollars in thousands) 2019 2019 2019 2018 2018 2018 2017 Bank total revenue: Net interest income $ 32,265 $ 31,794 $ 30,911 $ 30,058 $ 29,316 $ 115,455 $ 93,380 Total non-interest income 5,319 2,590 2,905 3,161 2,850 11,042 9,864 Less: net gain (loss) on the sale and call of debt securities 206 112 28 (76) — (70) 310 Bank total revenue $ 37,378 $ 34,272 $ 33,788 $ 33,295 $ 32,166 $ 126,567 $ 102,934 Bank efficiency ratio: Total non-interest expense (numerator) $ 18,949 $ 18,903 $ 19,021 $ 18,179 $ 17,002 $ 67,190 $ 59,073 Total revenue (denominator) $ 37,378 $ 34,272 $ 33,788 $ 33,295 $ 32,166 $ 126,567 $ 102,934 Bank efficiency ratio 50.70% 55.16% 56.30% 54.60% 52.86% 53.09% 57.39% For a comprehensive discussion on the use of non-GAAP data, please refer to the Company’s most recent quarterly financial results news release filed with the Securities and Exchange Commission and available at www.tscbank.com 33 Investor presentation
Reconciliation of Non-GAAP Financial measures to GAAP Income Statement Items For the Three Months Ended For the Years Ended September 30, June 30, March 31, December 31, September 30, December 31, December 31, (Dollars in thousands) 2019 2019 2019 2018 2018 2018 2017 Investment Management EBITDA: Net income $ 316 $ 672 $ 1,431 $ 1,468 $ 957 $ 3,851 $ 4,551 Interest expense — — — — — — — Income taxes expense (benefit) 3 264 563 (207) 282 579 522 Depreciation expense 111 119 125 126 126 502 497 Intangible amortization expense 502 502 502 503 502 1,968 1,851 EBITDA $ 932 $ 1,557 $ 2,621 $ 1,890 $ 1,867 $ 6,900 $ 7,421 For a comprehensive discussion on the use of non-GAAP data, please refer to the Company’s most recent quarterly financial results news release filed with the Securities and Exchange Commission and available at www.tscbank.com 34 Investor presentation
Reconciliation of Non-GAAP Financial measures to GAAP Balance Sheet Items As of September 30, June 30, March 31, December 31, September 30, (Dollars in thousands, except per share data) 2019 2019 2019 2018 2018 Tangible book value per common share: Common shareholders' equity $ 488,443 $ 472,839 $ 458,089 $ 440,886 $ 429,152 Less: goodwill and intangible assets 66,357 66,859 67,361 67,863 68,365 Tangible common equity $ 422,086 $ 405,980 $ 390,728 $ 373,023 $ 360,787 Common shares outstanding 29,296,970 29,339,152 29,351,833 28,878,674 28,920,978 Tangible book value per common share $ 14.41 $ 13.84 $ 13.31 $ 12.92 $ 12.47 For a comprehensive discussion on the use of non-GAAP data, please refer to the Company’s most recent quarterly financial results news release filed with the Securities and Exchange Commission and available at www.tscbank.com 35 Investor presentation