Citizens Financial Group, Inc. · NYSE:CFG
Citizens Financial — Investor Day (December 2018)
28 slides from Citizens Financial's investor day presentation, Dec 4, 2018
Slide 1: Turned the Corner, Aiming for Excellence
Turned the Corner, Aiming for Excellence Bruce Van Saun Chief Executive Officer December 4, 2018 Exhibit 99.1
Slide 2: Forward-looking statements and non-GAAP financial measures
Forward-looking statements and use of key performance metrics and non-GAAP financial measures This document contains forward-looking statements within the Private Securities Litigation Reform Act of 1995. Statements regarding potential future share repurchases and future dividends are forward-lookin
Slide 3: We've Turned the Corner
We’ve Turned the Corner Good foundation with attractive franchise Geographic footprint with large affluent and mass affluent segments Balanced Commercial and Consumer business mix Strong capital position RBS challenges impacted Citizens Forced balance sheet shrinkage hurt profitability Underinvestme
Slide 4: Next phase: Aiming for Excellence
Next phase: Aiming for Excellence To help our customers, colleagues and communities reach their potential Objective is to be a top-performing bank that delivers well for all stakeholders Committed to excellence in every dimension Focused on long-term franchise value and consistent delivery of earnin
Slide 5: Leadership Team
Average industry experience of ~30 years Leadership Team Member Title Bruce Van Saun Chairman and Chief Executive Officer John F. Woods Chief Financial Officer Mary Ellen Baker Head of Business Services Brad Conner Head of Consumer Banking Brendan Coughlin President, Consumer Deposits and Lending St
Slide 6: Have made consistent progress against our financial goals
Have made consistent progress against our financial goals Adjusted/ Underlying efficiency ratio(1) ~13 - 15% Key Indicators Adjusted/ Underlying ROTCE(1) EPS Adjusted/Underlying diluted EPS(1) Common equity tier 1 ratio(2) (3) Underlying results(1) Reported results(1) Adjusted results(1) Please see
Slide 7: Executive Summary: Positioning Citizens to Investors
Peer average Adjusted CFG Underlying/Adjusted Return on tangible common equity (Return on average tangible common equity change) â 5.5% vs Peers Efficiency improvement (Efficiency ratio change) á 10.8% vs Peers Strong operating leverage (Positive operating leverage) EPS Growth (Earnings per common s
Slide 8: RBS challenges negatively impacted Citizens balance sheet size and profitability
RBS challenges negatively impacted Citizens balance sheet size and profitability Citizens was forced to shrink its balance sheet post the Great Recession as it was ineligible for TARP and RBS had limited capital As part of IPO plan, balance sheet releveraging was a key to regaining profitability Loa
Slide 9: Substantial progress prudently releveraging the balance sheet
Substantial progress prudently releveraging the balance sheet Good loan growth with rising yields(1) $s in billions Average loan balances. Total loan losses as a percentage of the total loan book based on FRB Severely Adverse Scenario 9-quarter horizon for 2018. 2018 loan growth annualized for calcu
Slide 10: Highly disciplined on credit: diversified and granular core loan mix
Source: Company data. Portfolio balances loan category, NCO and NPL data, FICO score, LTV ratio, loan term, lien position, risk rating, property type, and industry sector as of September 30, 2018, as applicable. Portfolio balances as of September 30, 2018. Refreshed FICO score, LTV ratio, loan term,
Slide 11: Building fee capabilities organically and through targeted acquisitions
Commercial Capital & Global Markets Broaden capabilities in DCM, M&A, CRE New FX options/currency swaps platform and capabilities 2Q17 Western Reserve Partners acquisition added 30+ M&A professionals(1) Treasury Solutions Implementing best-in-class cash management system Investments in liquidity, pa
Slide 12: Rigorous TOP programs drive performance & allow self-funding of investments
Rigorous TOP programs drive performance & allow self-funding of investments Continuously streamlining expense base to self-fund required investments Focus on top-line growth and expense discipline drives positive operating leverage Upgraded talent – headcount relatively stable at ~18k over 5 years;
Slide 13: Rationalizing our capital base
Rationalizing our capital base Strong CET1 capital position relative to peers offers significant capital flexibility Expect annual normalization of ~40 bps given both strong capital return and loan growth Expect peers to target CET1 at 9%–9.5% Citizens will approach peer median over time Dividend an
Slide 14: Looking forward
Looking forward Success will be driven by what got us here today Continued investments in our future Strong and experienced board and leadership team, best-in-class talent Commitment to excellence in every dimension Proven execution ability Focus on our customers Long-term positioning to deliver ear
Slide 15: Key Messages
Key Messages Five years ago the challenge was to turn Citizens around and improve our performance and capabilities Since the IPO, the challenges have been addressed and we have turned the corner, while closing the gap to peers. Next phase: Aiming for Excellence Focused on long-term, profitable growt
Slide 16: Appendix
Appendix Xx Citizens nancial Group,
Slide 17: BSO: Rigorous program to improve returns while driving growth
BSO: Rigorous program to improve returns while driving growth 3Q18 YoY NIM expansion of 15 bps reflects ~5 bps contribution from BSO efforts(1) Assets Liabilities Loan portfolio Reposition/optimize loan mix Reallocate capital within categories; optimize credit-only relationships Investment portfolio
Slide 18: Remain rate sensitive
Remain rate sensitive Net interest income positioned to continue to benefit from rising rates Our asset sensitivity has remained relatively stable at 5.2% Interest rate sensitivity trend Interest rate sensitivity ranking (200 bps gradual increase) Note: CFG data as of 3Q18. Peer data from SNL as of
Slide 19: Data & analytics capabilities are key to our success
Data & analytics capabilities are key to our success Improve customer experience Future of fulfillment – expedited offers and closings Personalize customer interactions across all channels Using data & analytics strategically across the company Consumer Shift to targeted promotional deposit and lend
Slide 20: Investing in future-oriented digital services and technology platforms
Investing in future-oriented digital services and technology platforms Adaptive security Open architecture Cloud Agile Modernize strategic platforms Data analytics Convert data into intelligence Deliver access to high quality data for decision-making Enhance customer acquisition Deliver personalized
Slide 21: Enhancing customer experience to drive growth and efficiency
Enhancing customer experience to drive growth and efficiency Consumer Customer Journeys Embrace digital and data to improve experience Welcome to the bank Help me resolve problems Help me feel safe from fraud Help me buy a home Data intelligence platform drives targeting and offers across all channe
Slide 22: Citizens vs peer group by total CRE loans
Citizens vs peer group by total CRE loans – 3Q18 $s in billions Although Citizens has grown at a faster pace than peers, our CRE portfolio remains underweight versus peers Source : SNL and Call report/FR Y-9C
Slide 23: Key performance metrics, Non-GAAP financial measures and reconciliations
Key performance metrics, Non-GAAP financial measures and reconciliations $s in millions, except share, per share and ratio data
Slide 24: Key performance metrics, Non-GAAP financial measures and reconciliations
Key performance metrics, Non-GAAP financial measures and reconciliations $s in millions, except share, per share and ratio data
Slide 25: Key performance metrics, Non-GAAP financial measures and reconciliations
Key performance metrics, Non-GAAP financial measures and reconciliations $s in millions, except share, per share and ratio data
Slide 26: Key performance metrics, Non-GAAP financial measures and reconciliations
Key performance metrics, Non-GAAP financial measures and reconciliations $s in millions, except share, per share and ratio data
Slide 27: Key performance metrics, Non-GAAP financial measures and reconciliations
Key performance metrics, Non-GAAP financial measures and reconciliations $s in millions, except share, per share and ratio data
Slide 28: Citizens Financial Group, Inc.
3* Citizens Financial Group, Inc.”
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