Provident Financial Services, Inc · NYSE:PFS
Provident Financial Services — Sandler O'Neill & Partners Financial Services Conference 2004
18 slides from Provident Financial Services's conference presentation, Nov 10, 2004
Slide 1: Sandler O'Neill & Partners Financial Services Conference
Sandler O’Neill & Partners, L.P. Financial Services Conference November 11, 2004
Slide 2: Forward Looking Statements
Forward Looking Statements Certain statements contained herein are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such forward-looking statements may be identified by reference to a future period or
Slide 3: Characteristics and Milestones
Characteristics and Milestones Rich heritage: Bank founded 1839 Completed full conversion and initial public offering January 15, 2003 Listed on NYSE (PFS) Completed acquisition of First Sentinel Bancorp, Inc. July 14, 2004 Combination creates New Jersey’s 8th largest bank in deposit market share* 3
Slide 4: Key Business Drivers
Key Business Drivers Focused Operating Strategy Range and depth of offerings for Retail and Commercial Clients Effective Delivery with constant emphasis on Customer Service and Satisfaction Strong franchise in a market with superior demographics 77 branches in 10 New Jersey counties NJ median househ
Slide 5: Key Strategic Initiatives
Key Strategic Initiatives Retention and expansion of customer relationships Rational franchise expansion In-market de-novo branching Acquisitions considered if accretive to earnings Achieve 50/50 mix of Commercial (C&I and C.R.E.) and Retail (1-4 Family and Consumer) loan portfolios Optimize proport
Slide 6: Financial Overview
Financial Overview ($in millions) 9/30/2004 12/31/2003 12/31/2002 Assets $ 6,540 $ 4,285 $ 3,919 Loans (net) $ 3,710 $ 2,217 $ 2,032 Deposits $ 4,092 $ 2,696 $ 3,243 (1) Equity $ 1,135 $ 817 $ 326 Market Cap $ 1,304 $ 1,145 N/A Net Income ($in millions) $ 32.2 $ 18.7 (2) $ 26.6 (9 months actual) EPS
Slide 7: Geographic Market
Geographic Market Corporate HQ Jersey City, NJ Loan Center Woodbridge, NJ 77 Branches in 10 Counties First Sentinel acquisition has filled in geographic footprint and accommodates centralized lending operations Middlesex Somerset Monmouth Mercer Burlington Ocean Fairfield Bergen Essex Hudson Morris
Slide 8: Key Factors for Competitive Success
Key Factors for Competitive Success Continuing evolution from traditional thrift to full-service community bank Emphasis on core deposits (especially Business DDA) to build relationships and manage interest rate risk Consistent expansion of commercial lending expertise “Business Advantage” suite of
Slide 9: Deposit Mix
Deposit Mix 12/31/02 12/31/03 9/30/04 Savings, DDA, MMA 65% Time 35% Convr. Escr. 16% Time 32% Savings, DDA, MMA 52% Time 35% Savings, DDA, MMA 65%
Slide 10: Building Commercial DDA
Building Commercial DDA Number of accounts at period end Outstanding Balance at period-end ($in millions) Increasing Relationships Growing Balances 7,305 8,470 11,284 Sept., Business Checking Relationships (Non-Interest-Bearing accounts) $129 $145 $218 Sept., 2004 Business Checking Deposits (Non-Int
Slide 11: Loan Mix
Loan Mix 12/31/02 12/31/03 9/30/04 CRE C & I Consumer 1-4 Family 13% 11% 29% 47% 14% 9% 13% 34% 30% CRE Mtg. Warehouse C & I Consumer 1-4 Family 14% 9% 26% 51% CRE C & I Consumer 1-4 Family
Slide 12: Portfolio Growth: Commercial & Industrial Loans
Portfolio Growth Commercial & Industrial Loans Outstanding Balance at period-end ($in millions) At 9/30/04: 81% total portfolio growth above 12/31/02 77% organic growth 4% growth as result of First Sentinel acquisition $190 $251 $343 Dec-02 Dec-03 Sept. 04
Slide 13: Portfolio Growth: Construction Loans
Portfolio Growth Construction Loans Outstanding Balance at period-end ($in millions) At 9/30/04: 142% total portfolio growth above 12/31/02 13% organic growth 129% growth as result of First Sentinel acquisition $96 $99 $232 Dec-02 Dec-03 Sept. 04
Slide 14: Portfolio Growth: Commercial Real Estate Loans
Portfolio Growth Commercial Real Estate Loans Outstanding Balance at period-end ($in millions) At 9/30/04: 46% total portfolio growth above 12/31/02 1% organic growth 45% growth as result of First Sentinel acquisition $515 $540 $751 Dec-02 Dec-03 Sept. 04
Slide 15: Constant Focus on Asset Quality
Constant Focus on Asset Quality Consistent commitment to credit quality, regardless of business cycles Consistent underwriting standards & practices Aggressive collection efforts 0.41% 0.27% 0.13% Sept. 04 Non-performing Loans / Total Loans
Slide 16: Improving Operating Efficiency
Improving Operating Efficiency - managing overhead - achieving economies of scale 2.00% 2.20% 2.40% 2.60% 2.80% 3.00% 3.20% 3.40% 2002 * 2003 9mos-9/04 Operating Expense/Total Avg. Assets 60.0% 61.0% 62.0% 63.0% 64.0% 65.0% 66.0% 67.0% 68.0% 69.0% 70.0% 2002 * 2003 9mos-9/04 Efficiency Ratio * 2003
Slide 17: Capital Management
Capital Management Stock repurchase 1st buyback program approved January, 2004 purchase activity constrained pending acquisition program expanded post-acquisition to total of approx. 4 million (5%) of outstanding shares at 9/30/04, 738 thousand shares left to repurchase next program to be determined
Slide 18: Our Vision
Our Vision Investors seek Financial Performance Which will be Driven by Customers seek Customer-Centricity Which will be Driven by Employees seek Focused & Rewarded Workforce
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