First Citizens Bancshares, Inc. · NASDAQ:FCNCA

First Citizens Bancshares — Investor Presentation (April 2025)

30 slides from First Citizens Bancshares's investor presentation, Apr 30, 2025

  1. Slide 1: Monthly Market Update

    Brent Ciliano, SVP Chief Investment Officer Monthly Market Update Phillip Neuhart, SVP Director of Market and Recorded on April 30, 2025 Economic Research

  2. Slide 2: What are we going to cover?

    What are we going to cover? 1. Pulse Check: Trade Policy Update| Financial Market Impact 2. Economic Update: Growth Outlook | Inflation & Interest Rates | Labor Market & Consumer Spending 3. Market Update: Equity Markets | Valuations | Fixed Income

  3. Slide 3: Pulse Check

    Pulse Check Trade Policy Update| Financial Market Impact

  4. Slide 4: Steep Tariffs on China Account for the Lion's Share of Enacted Tariffs

    Steep Tariffs on China Account for the Lion’s Share of Enacted Tariffs Contribution to US Effective Tariff Rate With proposed "reciprocal" tariffs: 29.6% 30% With pending "sectoral" tariffs: 25.6% 25% "Reciprocal" Tariffs Suspended " Sectoral" Tariffs Pharmaceutical Current effective tariff rate: 20

  5. Slide 5: The Federal Budget Deficit Is Driven Largely by Mandatory Spending

    The Federal Budget Deficit Is Driven Largely by Mandatory Spending $8 trn Federal Budget, FY 2025 $7 trn Discretionary Non-Defense Budget Deficit $6 trn Spending Tariff revenue assuming Defense 2024 import levels $5 trn Other Mandatory Other revenues Corporate Income Taxes $4 trn Medicaid Payroll Ta

  6. Slide 6: Economic Uncertainty Is at Extreme Highs

    Economic Uncertainty Is at Extreme Highs US Economic Policy Uncertainty Index Average S&P 500 Returns Following Spikes in US Policy Uncertainty 600 25% (Economic Policy Uncertainty Index > 180) 22% 500 20% 400 15% 300 11% 10% 200 6% 5% 100 1% 0% 0 Post- 1 month Post- 3 month Post- 6 month Post- 12 m

  7. Slide 7: CEO Confidence Has Fallen Sharply to the Lowest in Over a Decade

    CEO Confidence Has Fallen Sharply to the Lowest in Over a Decade CEO Confidence Index 10 Survey, 1 (Weak) to 10 (Excellent) 9 8 7 6 5 July 2022: 5.1 April 2025: 4 5.0 3 2 1 0 2005 2007 2009 2011 2013 2015 2017 2019 2021 2023 2025 Source: Bloomberg 7

  8. Slide 8: Global Asset Prices Have Been Mixed Amid Extreme Uncertainty

    Global Asset Prices Have Been Mixed Amid Extreme Uncertainty Total Market Returns Since April 2: As of 4/28/2025 Since YTD • 8 daily changes of at least +/- 2% in Feb. 19 peak 2025 S&P 500 US Equities -10.2% -6.0% • 70 basis point range for 10-year yield Intl. Developed +3.0% +11.1% Equities • Highe

  9. Slide 9: Economic Update

    Economic Update Growth Outlook | Inflation & Interest Rates | Labor Market & Consumer Spending

  10. Slide 10: Global Growth Expectations Have Deteriorated

    Global Growth Expectations Have Deteriorated World Economic Outlook Consensus Real Economic Growth Estimates 2024 2025 Estimate as of: Actual Growth Dec. 2024 Today World 3.2% 3.0% -0.4% 2.6% United States 2.8% 2.1% -0.7% 1.4% Euro Area 0.9% 1.0% -0.2% 0.8% Canada 1.5% 1.8% -0.6% 1.2% Mexico 1.5% 1.

  11. Slide 11: Markets See the Fed Cutting Rates by about 1.0% This Year

    Markets See the Fed Cutting Rates by about 1.0% This Year Federal Funds Rate and Market-Implied Path Observed 6% Latest market pricing 5% Today: 4.4% 4% End-2025: 3% 3.4% 2% 1% 0% 2020 2021 2022 2023 2024 2025 2026 Source: Bloomberg, First Citizens Wealth. Data as of 4/29/2025. 11

  12. Slide 12: Before Tariffs Hit, Inflation Was Already Well Above the Fed's 2% Target

    Before Tariffs Hit, Inflation Was Already Well Above the Fed’s 2% Target Inflation: Consumer Price Index 12 Year-over-year 3-month annualized rate 10 8 6 4 2 2% target 0 -2 -4 -6 2018 2019 2020 2021 2022 2023 2024 2025 Source: Labor Department, Bloomberg. Data through March 2025. 12

  13. Slide 13: Household Inflation Expectations Have Surged, but Market Views Are Tamer

    Household Inflation Expectations Have Surged, but Market Views Are Tamer Inflation Expectations, Next Five Years Household expectations, next 5 years 7 5-year market breakeven rate Household expectations, next year 6 5 4 3 2 1 0 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 Source: Bloomber

  14. Slide 14: Job Growth Has Been Fairly Healthy in Recent Months

    Job Growth Has Been Fairly Healthy in Recent Months 800 Payroll Job Growth Thousands, three-month moving average 700 600 500 400 300 Estimated "breakeven" rate of job growth 200 100 0 Feb '21 Aug '21 Feb '22 Aug '22 Feb '23 Aug '23 Feb '24 Aug '24 Feb '25 Source: Department of Labor, Bloomberg. Data

  15. Slide 15: Labor Market Churn Was Subdued in the Months Before the Recent Tariffs

    Labor Market Churn Was Subdued in the Months Before the Recent Tariffs Job Openings and Labor Turnover 10% Job Openings Rate 9% Layoffs Rate Quits Rate 8% 7% 6% 5% 4% 3% 2% 1% 0% May '21 Jul '21 Jul '22 Jul '23 Sep '21 May '22 Sep '22 May '23 Sep '23 May '24 Jul '24 Sep '24 Jan '21 Jan '22 Jan '23 J

  16. Slide 16: Consumer Expenditures Are Holding Up, Still Led by Services Spending

    Consumer Expenditures Are Holding Up, Still Led by Services Spending Personal Consumption Expenditures 50% Percent change, year-over-year 40% Services 20-year average: Goods Services: 4.9% 30% Goods: 4.1% 20% 10% +5.3% 0% +2.9% -10% -20% 2018 2019 2020 2021 2022 2023 2024 2025 Source: Department of

  17. Slide 17: Household Finances Are Growing More Strained

    Household Finances Are Growing More Strained Delinquency Rates Likelihood of Being Able to Come Up with Percent of Total Loans Outstanding in Accounts 90+ Days Delinquent $2,000 for an Unexpected Expense Credit Card Loans (left axis) 15% Auto Loans (right axis) 5.5% 74% 14% 5.0% 72% 13% 4.5% 70% 12%

  18. Slide 18: Market Update

    Market Update Equity Markets | Valuations | Fixed Income

  19. Slide 19: The S&P 500 Sold Off 19% From Recent All-Time Highs

    The S&P 500 Sold Off 19% From Recent All-Time Highs S&P 500 Index 6500 6000 5500 -8% 5000 -5% -19% 4500 4000 -10% Total return since 10/12/2022: +61% -25% 3500 Jan '22 May '22 Sep '22 Jan '23 May '23 Sep '23 Jan '24 May '24 Sep '24 Jan '25 Source: Bloomberg. Data as of April 29, 2025. 19

  20. Slide 20: S&P 500 Valuations Have Contracted Modestly

    S&P 500 Valuations Have Contracted Modestly S&P 500 Next Twelve Months Price-to-Earnings Ratio 28X 24X 20X +1 Standard Deviation 16X Average 12X -1 Standard Deviation 8X 1989 1992 1995 1998 2001 2004 2007 2010 2013 2016 2019 2022 2025 Source: Strategas. Data as of 4/28/2025. 20

  21. Slide 21: Multiples for the Top 10 Largest Equities Have Moved Down

    Multiples for the Top 10 Largest Equities Have Moved Down Cap. Weighted Price-to-Forward Earnings Top 10 45x Top 11-500 40x 35x 30x 25x 20x 15x 10x 5x 2000 2004 2008 2012 2016 2020 2024 Source: Trivariate Research. Data as of 4/25/2025. 21

  22. Slide 22: Corporate Earnings

    Corporate Earnings Estimated Next 12-Month S&P 500 Operating Margin  2025 estimated growth is 9.7% 19%  Q1 2025 estimated growth is 10.1% 18% 17% 17.6%  2026 estimated growth is 13.8% 16% 15%  Average growth since 1950 is 7.6% 14% 13% 2012 2014 2016 2018 2020 2022 2024 Source: FactSet, Bloomberg

  23. Slide 23: Market Timing Is a Dangerous Game

    Market Timing Is a Dangerous Game Growth of $10,000, S&P 500 Compounded Total Returns, 1995 - 2024 $140,000 $131,347 37% less 54% less 73% less 83% less 89% less 92% less $120,000 • Nearly half (48%) of the S&P $100,000 500 Index’s strongest days $83,010 occurred during a bear $80,000 market. $60,23

  24. Slide 24: Volatility Can Persist in Near-Term but Investors Usually Win in the Long-Run

    Volatility Can Persist in Near-Term but Investors Usually Win in the Long-Run Largest 1-Day Gains for S&P 500 - Data Since 1950 Rank Date % Gain +5 Days +20 Days +65 Days +125 Days +250 Days 1. 10/13/2008 11.58% -1.8% -8.4% -15.9% -16.1% 6.8% 2. 10/28/2008 10.79% 6.9% -8.8% -12.2% -7.1% 13.4% 3. 4/9

  25. Slide 25: S&P 500 Price Target

    S&P 500 Price Target Next Twelve-Month S&P 500 Price Target Percent Next Twelve Months Change from Price Level 4/29/25 Bear 4,600 -16.6% Base 6,300 14.3% Bull 6,900 25.1% Source: Bloomberg, FactSet, First Citizens Wealth. 25

  26. Slide 26: Fixed Income Volatility Has Been Elevated

    Fixed Income Volatility Has Been Elevated Change in Fixed Income Yields Since January 1 +1.0% 10 Year Treasury Note +0.8% Municipal Bond Index +43bp to 4.14% +0.6% +0.4% +0.2% 0.0% -0.2% -0.4% -35bp to 4.21% -0.6% -0.8% Jan 02 Jan 16 Jan 30 Feb 13 Feb 27 Mar 13 Mar 27 Apr 10 Apr 24 Source: Bloomberg

  27. Slide 27: Corporate Bond Spreads Have Widened to Moderate Levels

    Corporate Bond Spreads Have Widened to Moderate Levels US Fixed Income 1,200 Option Adjusted Spreads in Basis Points High Yield Spread 1,000 Investment Grade Spread 800 600 400 200 0 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 Source: Bloomberg. Data as of 4/28/2025. 27

  28. Slide 28: Fixed Income Is Still Offering Attractive Yield

    Fixed Income Is Still Offering Attractive Yield US Fixed Income Indices Yield-to-Worst Index As of 4/28/2025 2-Year Treasury 3.7% 10-Year Treasury 4.2% Aggregate Bond 4.6% Intermediate Government/Credit 4.2% Municipal Bond 4.1% Investment Grade Corporate Bond 5.2% High Yield Corporate Bond 7.8% Sour

  29. Slide 29: Market & Economic Research

    Market & Economic Research Brent Ciliano, SVP Chief Investment Officer In Brief | A look at the week ahead in under two minutes every Monday morning Phillip Neuhart, SVP Q&A Videos | Monthly conversations covering 2-3 of the top Director of Market and questions we’re hearing from clients Economic Re

  30. Slide 30: Authors and Important Disclosures

    Authors Important Disclosures This material is for informational purposes only and is not intended to be an offer, specific investment strategy, Brent Ciliano, CFA | SVP, Chief Investment Officer recommendation, or solicitation to purchase or sell any security or insurance product, and should not be

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