Annual Shareholders’ Meeting
May 9, 2018
2
Forward Looking Statements
This presentation may contain forward-looking statements, which can be identified by the use of words such as “believes,” “expects,”
“anticipates,” “estimates” or similar expressions. These forward-looking statements include, but are not limited to:
statements of our goals, intentions and expectations;
statements regarding our business plans, prospects, growth and operating strategies;
statements regarding the asset quality of our loan and investment portfolios; and
estimates of our risks and future costs and benefits.
These forward-looking statements, which are based on our current beliefs and expectations, are subject to significant risks and
uncertainties. Actual results may differ materially from those contemplated by the forward-looking statements due to, among others, the
following factors:
general economic conditions, either nationally or in our market areas, that are different than expected;
changes in the interest rate environment that reduce our margins or reduce the fair value of financial instruments;
increased competitive pressures among financial services companies;
changes in consumer spending, borrowing and savings habits;
legislative or regulatory changes that adversely affect our business;
adverse changes in the securities and credit markets; and
changes in accounting policies and practices, as may be adopted by bank regulatory agencies or the Financial Accounting
Standards Board.
Additional factors that may affect our results are discussed in Item 1A “Risk Factors” in our Annual Report on Form 10-K and in other
reports filed with the Securities and Exchange Commission.
Any forward-looking statements made by us speak only as of the date hereof. Any of the forward-looking statements that we make in
this presentation may later prove incorrect because of inaccurate assumptions, the factors illustrated above or other factors that we
cannot foresee.
Because of these and other uncertainties, our actual future results may be materially different from the results indicated by these
forward-looking statements. We do not undertake, and specifically disclaim any obligation, to revise any forward-looking statements
contained in this presentation.
Market Summary
3
Issuer: March 31, 2017 March 31, 2018
Listing /Ticker Symbol:
Market Price Per Share: (1) $14.05 $14.40
Shares Outstanding: 12,203,593 12,242,434
Market Capitalization: $171.5 million $176.3 million
Tangible Book Value Per Share: (2) $12.19 $12.43
Price to Tangible Book Value: 115.26% 115.85%
Dividend Yield: (3) 1.42% 1.67%
(1) Closing price
(2) See Appendix - Non-GAAP Financial Measures
(3) Quarterly dividend increased to $0.06 in January 2018
Nasdaq Global Market / "SIFI"
Company Overview
An Overview of SI Financial
5
Headquartered in Willimantic, CT
Established in 1842
Source: SNL Financial
Total Assets as of December 31, 1995: $252 million
Total Assets as of December 31, 2017: $1.58 billion
Dayville
Dayville
Canterbury
Lisbon
Lebanon
Groton
Business Strategy
6
Community oriented focus with a full range of financial products and services
Prudently diversify the asset mix and geographic concentration by selectively
increasing the percentage of commercial business, multi-family and
commercial real estate loans locally and throughout New England
Continue conservative underwriting practices and maintain a high quality loan
portfolio
Increase core deposits by emphasizing exceptional customer service and
cross-selling and expanding our relationship-focused business lending
Supplement fee income through expanding the mortgage banking operations
Optimize future growth opportunities by executing a proven business model
and by opportunistically seeking branch or whole bank acquisitions in areas in
or adjacent to existing market area
Financial Highlights
$0.9
$4.4 $4.3
$6.3
$9.2
$2.0
0.08%
0.33%
0.31%
0.41%
0.58%
0.52%
0.00%
0.15%
0.30%
0.45%
0.60%
$0.0
$2.0
$4.0
$6.0
$8.0
$10.0
$12.0
2013Y 2014Y 2015Y 2016Y 2017Y 2018Q1
Improving Profitability
8
Core Income & Core ROAA ($MM)
(1) Core income excludes nonrecurring items
(2) See Appendix – Non-GAAP Financial Measures
(2) (2) (2)
Improving Profitability
9
Net Interest Margin (%)
2.93%
3.11%
2.97% 3.01% 2.89%
3.00%
0.00%
0.50%
1.00%
1.50%
2.00%
2.50%
3.00%
3.50%
2013Y 2014Y 2015Y 2016Y 2017Y 2018Q1
Improving Profitability
10
Efficiency Ratio (%)
96.1%
84.1%
82.2%
68.5%
73.6%
75.5%
2013Y 2014Y 2015Y 2016Y 2017Y 2018Q1
$231
$450 $431 $417 $417 $397
$202
$286 $298 $385
$422 $482
$217
$265 $266
$313
$334 $312
$47
$55 $58
$62
$61 $59
$697
$1,056 $1,053
$1,177
$1,234 $1,250
$0
$200
$400
$600
$800
$1,000
$1,200
$1,400
2012Y 2013Y 2014Y 2015Y 2016Y 2017Y
Residential RE Commerical RE Commerical & Industrial Consumer & Other
Consistent Loan Growth
11
CAGR: 12.4%
Total Gross Loans ($MM)
Acquisition of Newport
Bancorp, Inc.
(1) Commercial & industrial loans include construction loans
(2) Includes deferred loan origination costs/fees and loans held for sale
Source: SNL Financial.
(2) (1)
Strong Loan Growth
12
5 Year Gross Loan CAGR (%)
Source: SNL Financial as of December 31, 2017
Note: Peers include all public and private banks and thrifts headquartered in the Northeast with 2017Y assets between $1 billion and $5 billion; Group consists of 59 companies
12.4%
9.0%
7.0%
10.5%
14.0%
SIFI Peer Median
$338
$495 $487 $500 $493 $540
$277
$351 $378
$394 $436
$447
$90
$139 $146
$164
$202
$221
$705
$985 $1,011
$1,058
$1,131
$1,208
$0
$200
$400
$600
$800
$1,000
$1,200
$1,400
2012Y 2013Y 2014Y 2015Y 2016Y 2017Y
NOW/Savings/MMDA Time Demand Deposits
Consistent Deposit Growth
13
CAGR: 11.4% Acquisition of Newport
Bancorp, Inc.
Deposits ($MM)
Source: SNL Financial.
Strong Deposit Growth
14
2017 Noninterest Bearing Deposits / Total Deposits (%) 5 Year Deposit CAGR (%)
Source: SNL Financial as of December 31, 2017
Note: Peers include all public and private banks and thrifts headquartered in the Northeast with 2017Y assets between $1 billion and $5 billion; Group consists of 59 companies
11.4%
10.9%
6.00%
9.00%
12.00%
SIFI Peer Top Quartile
18.3%
14.8%
10.0%
15.0%
20.0%
SIFI Peer Top Quartile
Strong Asset Quality
15
Nonperforming Loans / Total Loans (%)
Net Charge-offs / Average Loans (%)
• Savings Institute has maintained high asset quality with solid reserve coverage
• Aggressive early recognition of nonperforming loans
0.66%
0.48%
0.56%
0.44% 0.51%
0.62%
0.00%
0.30%
0.60%
0.90%
1.20%
2013Y 2014Y 2015Y 2016Y 2017Y 2018Q1
0.10%
0.06%
0.04%
0.02% 0.01% 0.02%
0.00%
0.05%
0.10%
0.15%
0.20%
0.25%
2013Y 2014Y 2015Y 2016Y 2017Y 2018Q1
Financial Strength – December 31, 2017
16
Capital available for growth
Possible repurchases
Ratio
Minimum
Required
Well
Capitalized
Total Risk-Based Capital 16.49% 8.00% 10.00%
Tier 1 Risk-Based Capital 15.29% 6.00% 8.00%
Tier 1 Capital 10.36% 4.00% 5.00%
Common Equity Tier 1 Capital 14.54% 4.50% 6.50%
Appendix – Non-GAAP Financial Measures
Non-GAAP Financial Measures
18
Dollars in thousands, except per share amounts.
Core Income: 12/31/2017 12/31/2016 12/31/2013
Reported net income (loss) 5,242$ 11,310$ (855)$
Merger expenses - - 1,721
Net gain on sale of investment in affiliate - (5,060) -
Revaluation of deferred tax asset 3,969 - -
Core income 9,211$ 6,250$ 866$
Tangible Book Value Per Share: 3/31/2018 3/31/2017
Book value per share 13.80$ 13.61$
Effect of intangible assets per share (1.37) (1.42)
Tangible book value per share 12.43$ 12.19$
Tangible Common Equity:
Equity 168,919$ 166,064$
Less: Intangible assets (16,742) (17,344)
Tangible common equity 152,177$ 148,720$
QUESTIONS
&
ANSWERS