Fifth Third Bancorp · NASDAQ:FITB
Fifth Third Bancorp — UBS Global Financial Services Conference 2007
19 slides from Fifth Third Bancorp's conference presentation, May 16, 2007
Slide 1: UBS Global Financial Services Conference
Exhibit 99.1 UBS Global Financial Services Conference Kevin Kabat, President and CEO Chris Marshall, EVP and CFO May 16, 2007 Fifth Third Bank | All Rights Reserved
Slide 2: Fifth Third profile
Fifth Third profile $100 billion assets (#13) $22 billion market cap* (#12) 1,161 banking centers 2,104 ATMs 18 affiliates in 10 states $1.4 billion net income # * as of 5/10/07. # 1Q07 annualized. 2 Fifth Third Bank | All Rights Reserved
Slide 3: Historical context
Historical context Strong sales culture — Loan, deposit growth > industry — Affiliate/entrepreneurial drive Strong expense management — Low 50s efficiency ratio Average service/customer satisfaction — “Sold through” attrition (e.g., DDA high-teens) Internal orientation Retain and leverage historical
Slide 4: Strategic focus: 2007–2009
Strategic focus: 2007–2009 Deliver growth in excess of industry Enhance the customer experience Increase employee engagement Institutionalize enterprise operational excellence 4 Fifth Third Bank | All Rights Reserved
Slide 5: Growth opportunities
Growth opportunities Areas of evident success — De novo – accelerate new branch openings — Credit card – increase cardholder acquisition — Healthcare – enhance product offerings, specialized channel Works in progress — Commercial underserved markets – targeted markets for deployment of additional ba
Slide 6: De novo deposit growth
De novo deposit growth FDIC data: average annualized deposits by FDIC deposit year vintage 45,000 $40MM Y6 pace All full service 5/3 de novos (new target) 40,000 35,000 $35MM Y6 pace 30,000 (original target) 25,000 FDIC Vintage Yr Total De Novos 20,000 2001: 16; 2002: 8; 2003: 27; 15,000 2004: 45; 2
Slide 7: Fifth Third healthcare strategy
Fifth Third healthcare strategy Relationships • Primary Bank for fewer than 50 hospitals / health systems • Over 600 healthcare entities in-footprint with revenues > $100 Million • Current market share of 2.3% (12.7% gap to total commercial business market share) Relationships Promote a comprehensiv
Slide 8: Credit cards: capturing our fair share
Credit cards: capturing our fair share 13th largest bank, 24th largest credit card issuer We’ve underinvested in the credit card business relative to competitors Significant opportunity in high risk-adjusted return business — Improve retail production by deploying sales technologies to enhance ease
Slide 9: FTPS: key growth engine
FTPS: key growth engine 2006 revenue* 35% Merchant Services 46% Financial Institutions Bankcard 19% Merchant Financial Institutions Bankcard th • 4 Largest U.S. Acquirer • 2,300 FI relationships • $1.1B in outstanding balances • Over 31,000 merchants • Over 900MM POS/ATM transactions • 1.0MM cardhol
Slide 10: Strong growth, high value business
Strong growth, high value business 250 CAGR +20% 200 CAGR 150 22% CAGR 100 36% 50 CAGR 12% 0 Merchant Card Interchange FI/EFT *1Q04 excludes $20 million in revenue related to the previously disclosed sale of certain small merchant contracts representing $93 million in annual revenue. 10 Fifth Third
Slide 11: University of Michigan – ACSI Survey
University of Michigan – ACSI Survey Surveyed customers of large U.S. banks* 80 79 78 76 Citigroup Wells 72 72 72 72 72 72 72 Chase 71 70 70 70 B of A Fifth Third 67 Wachovia 2004 2005 2006 *Fifth Third Bank engaged the American Customer Satisfaction Index (ACSI)in custom research projects surveying
Slide 12: Enterprise Operational Excellence
Enterprise Operational Excellence Improve operational efficiencies — Standardize, digitize and optimize core processes — Deploy technology to eliminate manual processes and improve quality — Reducing cycle times and errors is increasing customer satisfaction Modernize servicing platforms and capabil
Slide 13: Fifth Third: 2007 Outlook
Fifth Third: 2007 Outlook Category Growth, percentage, or bps range Net interest income Mid-to-high single digits Net interest margin 3.35-3.45% Noninterest income* High single digits Noninterest expense** Mid single digits Loans Mid-to-high single digits Core deposits Mid single digits Net charge-o
Slide 14: Credit quality
Credit quality Total net charge-offs 0.70% 0.60% 2007 full year 0.50% outlook: low 50s bps 0.40% 0.39% 0.30% 0.20% 0.10% 0.00% Peer group median Fifth Third Stable net charge-off experience Consistent trends in probability of default ratings — 2003 through 1Q07 all in 6.1-6.3 PD range Over 75% of co
Slide 15: Credit quality (cont.)
Credit quality (cont.) Commercial and consumer net charge-offs* 0.70% Full year low 0.60% 60s bps 0.50% 0.53% Full year 0.40% high 30s bps 0.30% 0.20% 0.27% 0.10% 0.00% Total Commercial Total Consumer Commercial NCO ratios have historically ranged between 20-60 bps — 2006: 34 bps — 4Q06: 42 bps — 1Q
Slide 16: Capital plan
Capital plan Current tangible capital levels very strong — Tangible common equity/tangible assets ratio of 7.65% at 3/31/07 — 2007 year-end TCE/TA target: 7% 2007 plans — Improve efficiency of capital structure through limited substitution of hybrids for common stock — Share repurchase authorization
Slide 17: M&A – what matters to Fifth Third
M&A – what matters to Fifth Third Markets — Expansion into demographically attractive geographies — Creation of deeper shares in existing markets Attractive business lines — Supplement existing business, addition of complementary businesses or capabilities Favorable economics — Conservative assumpti
Slide 18: Fifth Third: building a better tomorrow
Fifth Third: building a better tomorrow Balancing growth and profitability Capitalizing on strengths and developing plans to address areas of weakness Communicating clearly with investors Delivering on promises Returning to above-par performance and shareholder returns 18 Fifth Third Bank | All Righ
Slide 19: Cautionary Statement
Cautionary Statement This report may contain forward-looking statements about Fifth Third Bancorp and/or the company as combined acquired entities within the meaning of Sections 27A of the Securities Act of 1933, as amended, and Rule 175 promulgated thereunder, and 21E of the Securities Exchange Act
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