Wesbanco, Inc. · NASDAQ:WSBC
Wesbanco — Keefe, Bruyette & Woods 2010 Community Bank Conference
33 slides from Wesbanco's conference presentation, Jul 26, 2010
Slide 1: Keefe, Bruyette & Woods 2010 Community Bank Conference
Keefe, Bruyette, & Woods 2010 Community Bank Conference July 27-28, 2010 New York, NY
Slide 2: Forward-Looking Statements
Forward-Looking Statements Forward-looking statements in this presentation relating to WesBanco’s plans, strategies, objectives, expectations, intentions and adequacy of resources, are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The informatio
Slide 3: WesBanco at a Glance
WesBanco at a Glance • Headquarters in Wheeling, West Virginia • Assets: $5.4 billion • Founded in 1870 • 32 banks/23 companies acquired in 25 years • Banking operations in West Virginia, Ohio and Western Pennsylvania 112 banking offices + Pittsburgh Business Loan Office 134 ATM’s • Non-bank act
Slide 4: An Expanding Franchise in Contiguous Markets
An Expanding Franchise in Contiguous Markets: 113 banking offices • Ranked #1-3 in deposit market share in 14 counties out of 37* Springfield Columbus Wheeling • Expanding along major highways to Dayton population centers (Columbus, Dayton, Huntington Cincinnati) • Organized into seven markets * SNL
Slide 5: Marcellus Shale Play
Marcellus Shale Play • Area five times as large as Barnett Shale – primarily in WV & PA, parts of NY & OH. • PSU study suggests 200k jobs created by Marcellus drilling activity by 2020. • Total estimated economic activity by 2020 - $19 B. • Portion relating to WV - $3 B. • WSBC in 10 out of 32 count
Slide 6: Growth by Acquisition: A WSBC Core Competency
Growth by Acquisition: A WSBC Core Competency (MM) 7.5 year Asset Growth • Focused on higher growth CAGR = 11.8% metro markets and enhanced market share • Five acquisitions in seven years – assets more than doubled since 2001 • A history of successful consolidations • Acquired 5 branches In Columbus
Slide 7: Recent Accomplishments
Recent Accomplishments • Completed Amtrust branch acquisition, adding $600 million in deposits and enhancing overall bank liquidity while moving to #9 in market share in Columbus, OH. • Paid back $75 million in TARP without common raise. • Earnings for 2009 and first half of 2010 compare favorably t
Slide 8: Performance Comparison: Six Months Ended June 30
For the Six Months Ended – June 30 Performance Comparison ($000’s except per share data) 2Q 2010 2Q 2009 %∆ Net Income Available to Common $16,149 $9,082 + 77.8% Shareholders Diluted Earnings Per Share $0.61 $0.34 + 79.4% Loan Loss Provision $23,175 $19,819 + 16.9% Return on Average Assets 0.60% 0.3
Slide 9: Quarterly Performance Comparison
Quarterly Performance Comparison %∆ %∆ %∆ %∆ 2Q-10 vs. 1Q-10 vs. 4Q-09 vs. 3Q-09 vs. ($000’s except per share data) 2Q-09 1Q-09 4Q-08 3Q-08 Net Income Available to Common + 75.8% + 80.0% + 32.0% - 79.8% Shareholders Diluted Earnings Per Share + 72.2% + 76.5% + 28.6% - 79.1% Loan Loss Provision + 13.
Slide 10: ROAA: Pre-Tax, Pre-Provision, Pre-TARP
ROAA: Pre-Tax, Pre-Provision, Pre-TARP
Slide 11: Strong Capital Base
15.00% 12.00% 9.00% 6.00% 3.00% 0.00% 2008 2009 1 = Tangible Equity / Tangible Assets Total Risk Based Capital WesBanco
Slide 12: Ann. Net Charge-offs / Avg. Loans
Ann. Net Charge-offs / Avg. Loans • National Peer Group = Average of 103 banks nationwide with assets between $2-$10 B. Source: SNL Financial (2nd Quarter Peer Data Unavailable)
Slide 13: NPA + ≥ 90 PD Loans / Total Loans + OREO
NPA + ≥ 90 PD Loans / Total Loans + OREO • National Peer Group = Average of 103 banks nationwide with assets between $2-$10 B. Source: SNL Financial (2nd Quarter Peer Data Unavailable)
Slide 14: Improving Credit Infrastructure: 2010 Initiatives
Improving Credit Infrastructure: 2010 Initiatives • Added more staff to Special Assets and credit risk management • Conducted skills assessment to identify and prioritize opportunities for lender development • Initiated additional formal credit training program for commercial & retail sales force •
Slide 15: 2010 Initiatives
2010 Initiatives • Continue balance sheet restructuring to improve capital & efficiency and interest rate sensitivity. • Improve regulatory capital above new “unofficial” well- capitalized ratios. • Promote margin expansion through enhanced marketing of low cost accounts, management of loan/deposit
Slide 16: 2010 Initiatives (con't.)
2010 Initiatives (con’t.) • Improve fee income by expanding treasury management focus and increasing sales of non-traditional products such as trust, brokerage and insurance. • Control non-interest expenses through improved monitoring processes and technology initiatives. • Monitor opportunities for
Slide 17: Wealth Management Services
Wealth Management Services • $2.6B of assets under management/custody. • Over 5,000 trust relationships. • 4 locations in WV & OH • Improving performance as asset values recover. • Product capabilities: Trust Investment mgmt. WesMark Funds Estate planning Financial planning Brokerage R
Slide 18: Significant Liquidity
Significant Liquidity • Loan-to-deposit ratio decreased to 83% at 6/30/10, down from 103% pre-Amtrust branch purchase. • Reduced reliance on wholesale funding (borrowings and brokered CDs); < 16% of total assets. • Securities portfolio of $1.3B highly liquid; 53.5% unpledged and $28 MM in net unreal
Slide 19: Securities Portfolio – Quality & Liquidity
Securities Portfolio – Quality & Liquidity Securities = $1.27 B • Average portfolio yield of 4.18% YTD. ~24% of total assets • WAL approx. 4 years. • Over 53% unpledged. Agencies & Bonds • Minimal private label CMO’s, 23.2% equities or corporate/ABS Mortgage- securities. Backed & CMOs, 47.1% • Net u
Slide 20: Municipal Bond Portfolio Characteristics
Municipal Bond Portfolio Characteristics • Portfolio comprised of $367 million of tax exempts and taxable Build America Bonds. • Approximately 89% are local issuers, all bank-qualified. • G.O.’s are 77% of total; 23% local revenue bonds. • 93% rated, with 69% rated AA (or its equivalent) or higher.
Slide 21: Diversified Loan Portfolio
Diversified Loan Portfolio Total Loans = $3.42 B Comm. Real Estate = Comm. & Ind. $1.77 B 13% Consumer Const & Dev. 8% 15% Comm. Real Estate, 52% HELOC, 7% Investor- Owner- Owned Occupied 50% 35% Res. Real Estate, 19%
Slide 22: Conservative Exposure to Potential Problem Loan Areas
Conservative Exposure to Potential Problem Loan Areas WSBC is Below Regulatory CRE Guidelines Exposure1 % of Regulatory ($Millions) RBC2 Guideline Land, Construction & Development $309 71% 100% Investor-Owned Commercial $619 142% N/A Investor-Owned Multi-Family $175 40% N/A Total Land, C&D, and Inve
Slide 23: Net Interest Margin
7.00% 6.00% 5.00% 4.00% 3.00% 2.00% 1.00% 0.00% Yield on Earning Assets = Cost of Funds WesBanco
Slide 24: Growing & Diversified Noninterest Income
Growing & Diversified Noninterest Income • Noninterest income contributes 27% of 2010 YTD revenue. ($MM) $65.0 $59.7 • Non-bank offerings (trust, $57.3 insurance, securities) contribute $52.9 over $23 million in 2010 annualized $40.4 revenue. • Trust fees are up 10.6% from 2Q ’09. Annualized
Slide 25: Interest Rate Sensitivity
Interest Rate Sensitivity % Change in Net Interest Income from Immediate Change in Base Over One Year Interest Rates June 30, 2010 Mar. 31, 2010 Up 1% Rate Shock +2.6% +2.0% Up 2% Rate Shock +2.0% -0.3% Up 3% Rate Shock +0.8% -2.9% Up 2% Rate Ramp +2.9% +2.6% Down 1% Rate Shock -3.4% -1.8%
Slide 26: Peer Group – Price / Tangible Book Value
Peer Group – Price / Tangible Book Value Price / Tangible Book Value (X) (X) Source: SNL Financial and FactSet Research Systems Peer group includes select banks located in Western Pennsylvania, Ohio, Indiana and West Virginia with assets between $1 billion and $10 billion Data as of 3/31/10; Pro for
Slide 27: Peer Group – Price / Normalized Earnings
Peer Group – Price / Normalized Earnings Price / Normalized Earnings (x) (1) Source: Pricing data per FactSet Research Systems (1) Normalized earnings estimates per KBW Research ; PRK, FRME, SRCE, UBSI and PEBO normalized earnings estimates not available Data through 5/25/2010
Slide 28: Current Market Update
Current Market Update Market Performance – Cycle-to-Date Market Performance – YTD Source: FactSet Research Systems
Slide 29: Research Analyst Coverage
Research Analyst Coverage 2010 EPS 2011 EPS Investment Bank Current Rating Estimate Estimate Keefe, Bruyette, & Woods Market Perform $1.15 $1.20 Macquarie Neutral $1.20 $1.50 Sterne Agee Neutral $1.20 $1.34 Boenning & Scattergood Neutral / Moderate $1.20 $1.53 Janney Capital Markets Neutral $1.17 $1
Slide 30: Investment Rationale
Investment Rationale Stability, Diversity and Capital Strength • Strong regulatory capital • Proven acquisition-oriented growth strategy • Improving liquidity • Asset quality compares favorably with peers • Diverse earnings stream • Positioned for rising rates • Improving stock performance
Slide 31: Appendix: Loan Totals by Market
Appendix: Loan Totals by Market ($ millions) Commercial Retail Total Loans Upper Ohio Valley $ 448 $ 409 $ 857 North Central WV 226 187 413 Parkersburg 208 88 296 Kanawha Valley 65 37 102 Western PA 191 15 207 Total East Markets $ 1,138 $ 737 $ 1,875 Central Ohio 538 148 686 Southwest Ohio 379 170 5
Slide 32: Appendix: Credit Quality Per Market
Appendix: Credit Quality Per Market ($ thousands) 90 Day PD Non- Reneg. Other RE & Accruing Accrual Loans Owned Upper Ohio Valley $ 1,039 $ 7,796 $ 5,858 $ 1,713 North Central WV 1,120 804 524 333 Parkersburg 340 2,434 432 339 Kanawha Valley 39 2,627 N/A 396 Western PA 327 2,756 250 150 Total East M
Slide 33: WesBanco
WesBanco
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