First Financial Bankshares, Inc. · NASDAQ:FFIN
First Financial Bankshares — Shareholder Meeting (April 2019)
86 slides from First Financial Bankshares's shareholder meeting presentation, Apr 23, 2019
Slide 1: 2019 Annual Shareholders' Meeting
2019 ANNUAL SHAREHOLDERS’ MEETING 1
Slide 2: Executive Management Team
Executive Management Team Scott Dueser Chairman of the Board, President and Chief Executive Officer 43 48 At FFIN In Banking 2
Slide 3: Executive Management Team
Executive Management Team Ron Butler Executive Vice President Chief Administrative Officer 26 37 At FFIN In Banking Tim Collard Executive Vice President Lending 27 38 At FFIN In Banking 3
Slide 4: Executive Management Team
Executive Management Team Troy Fore President First Financial Mortgage 4 38 At FFIN In Banking Gary S. Gragg Executive Vice President Chief Lending Officer 2840 At FFIN In Banking 4
Slide 5: Executive Management Team
Executive Management Team J. Bruce Hildebrand, CPA Executive Vice President Chief Financial Officer 16 40 Monica Houston At FFIN In Banking Executive Vice President Retail Banking and Training 23 23 At FFIN In Banking 5
Slide 6: Executive Management Team
Executive Management Team Luke Longhofer Executive Vice President Chief Credit Officer 8 16 At FFIN In Banking Randy Roewe Executive Vice President Chief Risk Officer 4 29 At FFIN In Banking 6
Slide 7: Executive Management Team
Executive Management Team John Ruzicka Executive Vice President Chief Information Officer 1 39 At FFIN In Banking Michele Stevens Executive Vice President Advertising and Marketing 22 35 At FFIN In Banking 7
Slide 8: Executive Management Team
Executive Management Team Kirk Thaxton, CTFA Chairman, President, and CEO First Financial Trust and Asset Management 32 36 At FFIN In Banking Marna Yerigan Executive Vice President Lending 8 38 At FFIN In Banking 8
Slide 9: Senior Management Team
Senior Management Team Brandon Harris J. Kyle McVey, Senior Vice President Appraisal Services CPA Senior Vice President 5 18 Chief Accounting Officer At FFIN In Banking 9 11 At FFIN In Banking Larry Kentz Senior Vice President and Compliance Officer Compliance 5 38 At FFIN In Banking 9
Slide 10: Line of Business Executives
Line of Business Executives Brandon Barker Co-Manager First Financial Investment Advisors 13At FFIN | 26 In Banking Will Christoferson Vice President Marketing 1At FFIN | 10 In Banking Frank Gioia Senior Vice President Customer Care Center 4At FFIN | 32 In Banking Tony Gorman Senior Vice President H
Slide 11: Experienced Regional CEOs & Presidents
Experienced Regional CEOs & Presidents Marelyn Shedd David Bailey Abilene Eastland 29 36 16 16 At FFIN In Banking At FFIN In Banking Joseph Crouch Mike Mauldin Sweetwater Hereford 2 23 17 42 At FFIN In Banking At FFIN In Banking 11
Slide 12: Experienced Regional CEOs & Presidents
Experienced Regional CEOs & Presidents Chris Evatt Trent Swearengin San Angelo Stephenville 19 19 20 22 At FFIN In Banking At FFIN In Banking Austin Elsner Cleburne 2 19 At FFIN In Banking Justin Hooper Weatherford 15 26 At FFIN In Banking 12
Slide 13: Experienced Regional CEOs & Presidents
Experienced Regional CEOs & Presidents Mark Jones Sam Baker Southlake Conroe 19 42 4 43 At FFIN In Banking At FFIN In Banking Stephen Lee Kirby Cason Southeast Texas Huntsville 7 31 1 13 At FFIN In Banking At FFIN In Banking 13
Slide 14: Experienced Regional CEOs & Presidents
Experienced Regional CEOs & Presidents Johnny Brooks Kingwood 1 at FFIN 37 in Banking Shelley Dacus Kingwood 1 AT FFIN 15 In Banking Marcus Morris Fort Worth 9 At FFIN 11 In Banking 14
Slide 15: 15
15
Slide 16: Independent Public Auditors
Independent Public Auditors 16
Slide 17: 2018 Financial Review Earnings
2018 Financial Review Earnings 17
Slide 18: Board of Directors
Board of Directors April Anthony Chief Executive Officer Encompass Home Health and Hospice & Homecare Homebase 4 Audit Years On Committee Appointment Board David Copeland President, SIPCO, Inc. and Shelton Family Foundation Executive/Audit 21 Nominating/Corporate Governance Years On Committee Appoin
Slide 19: Board of Directors
Board of Directors F. Scott Dueser Chairman of the Board, President and CEO 28 Executive Years On Committee Appointment Board Ron Giddiens G&G Investments 10 Audit Years On Committee Appointment Board Murray Edwards Principal, The Edwards Group Executive/Audit 13 Nominating/Corporate Governance Year
Slide 20: Board of Directors
Board of Directors Kade L. Matthews Ranching and Investments 21 Compensation Years On Committee Appointment Board Ross H. Smith, Jr. Chairman and President Akrotex, Inc. 5 Compensation Years On Committee Appointment Board Robert C. Nickles, Jr. Executive Chairman of Alegacy Group, LLC Compensation Y
Slide 21: Annual Shareholders' 2019 Meeting
ANNUAL SHAREHOLDERS’ 2019MEETING 21
Slide 22: Forward Looking Statement
Forward Looking Statement Certain statements contained herein may be considered “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995. These statements are based upon the belief of the Company’s management, as well as assumptions made beyond information curr
Slide 23: 2018 Financial Review Earnings
2018 Financial Review Earnings 23
Slide 24: 32nd Consecutive Year of Increased Earnings
32nd Consecutive Year of Increased Earnings FFIN Earnings (in millions) * Adjusted for tax rate change $150.6 $120.4 $0.66* $100.4 $104.8 $89.6 $7.65* $78.9 2013 2014 2015 2016 2017 2018 24
Slide 25: Strong Shareholder Earnings
Strong Shareholder Earnings Basic Earnings Per Share * Adjusted for tax rate change $2.23 $1.82 $0.01* $1.55 $1.59 $1.40 $0.11* $1.24 2013 2014 2015 2016 2017 2018 25
Slide 26: Working Harder and Smarter
Working Harder and Smarter Efficiency Ratio (FFIN vs. Peers) 2013 2014 2015 2016 2017 2018 First Financial 50.20% 49.24% 47.61% 49.22% 49.26% 49.72% Peer Group 67.87% 66.94% 63.92% 62.83% 61.01% 60.51% 26
Slide 27: Net Interest Margin
Net Interest Margin Quarterly Interest Margin First Financial Peer Group 4.50% 4.25% 4.00% 3.75% 3.50% 3.25% 3.00% 2015 2016 2017 2018 27
Slide 28: FFIN Outperforms Peers
FFIN Outperforms Peers Percentage Return on Average Assets First Financial Peer Group 1.98% 1.64% 1.65% 1.72% 1.61% 1.59% 1.22% 1.03% 1.00% 0.95% 0.95% 0.95% 2013 2014 2015 2016 2017 2018 28
Slide 29: Strong Return on Capital
Strong Return on Capital Percentage Return on Average Equity First Financial Peer Group 15.37% 13.75% 14.00% 13.60% 13.63% 12.36% 10.86% 8.88% 9.16% 8.67% 8.32% 8.59% 2013 2014 2015 2016 2017 2018 29
Slide 30: Capital Ratios
Capital Ratios To meet Requirements 12/31/18 3/31/19 of BASEL III for 2019 Tier 1 Leverage Ratio 11.85 12.08 > 4.00 Common Equity Tier 1 Capital Ratio 19.47 19.86 > 7.00 Tier 1 Capital Ratio 19.47 19.86 > 8.50 Total Capital Ratio 20.61 21.00 > 10.50 30
Slide 31: Asset Performance
Asset Performance Growth in Total Assets (in millions) $6,810 $7,255 $7,732 $6,665 $5,848 $5,222 2013 2014 2015 2016 2017 2018 31
Slide 32: Loan Performance
Loan Performance Growth in FFIN Total Loans (in millions) Agricultural Consumer Commercial 1-4 Family Real Estate Commercial Real Estate $3,975 $3,351 $3,384 $3,501 $2,938 $1,517 $2,689 $1,250 $1,207 $1,208 $976 $912 $1,143 $971 $1,009 $1,069 $855 $777 $640 $685 $674 $683 $845 $590 $334 $361 $386 $4
Slide 33: Sound Lending Practices
Sound Lending Practices Nonperforming Assets as a Percentage of Loans + Foreclosed Assets (FFIN vs Peers) 2013 2014 2015 2016 2017 2018 First Financial 1.16% 0.74% 0.90% 0.86% 0.57% 0.75% Peer Group 2.71% 1.92% 1.32% 1.05% 0.86% 0.82% 33
Slide 34: Deposit Growth
Deposit Growth Growth in FFIN Total Deposits (in millions) Non Interest Bearing Interest Bearing $6,180 $5,963 $5,479 $5,190 $4,135 $4,750 $3,921 $4,064 $3,180 $3,444 $3,761 $2,773 $1,746 $1,718 $2,042 $2,116 $1,362 $1,570 2013 2014 2015 2016 2017 2018 34
Slide 35: 1st Quarter 2019 Summary
1st Quarter 2019 Summary 35
Slide 36: 1st Quarter Earnings
1st Quarter Earnings FFIN Earnings (in millions) $38.3 $34.5 $25.7 $26.6 $22.3 $24.0 2014 2015 2016 2017 2018 2019 36
Slide 37: Shareholder Earnings—1st Quarter
Shareholder Earnings—1st Quarter Basic Earnings Per Share $0.56 $0.51 $0.39 $0.40 $0.35 $0.37 2014 2015 2016 2017 2018 2019 37
Slide 38: Asset Performance
Asset Performance Growth in Total Assets (in millions) * As of March 31, 2019 $7,732 $7,945* $7,255 $6,665 $6,810 $5,848 2014 2015 2016 2017 2018 2019 38
Slide 39: Loan Performance
Loan Performance Growth in FFIN Total Loans (in millions) * As of March 31, 2019 Agricultural Consumer Commercial 1-4 Family Real Estate Commercial Real Estate $3,975 $4,004* $3,351 $3,384 $3,501 $2,938 $1,517 $1,505 $1,207 $1,208 $1,250 $976 $1,143 $1,200 $971 $1,009 $1,069 $855 $640 $685 $674 $683
Slide 40: Deposit Growth
Deposit Growth Growth in FFIN Total Deposits (in millions) * As of March 31, 2019 Non Interest Bearing Interest Bearing $6,180 $6,351* $5,963 $5,190 $5,479 $4,750 $4,064 $4,185 $3,921 $3,444 $3,761 $3,180 $1,746 $2,042 $2,116 $2,166 $1,570 $1,718 2014 2015 2016 2017 2018 2019 40
Slide 41: First Financial Trust Your Future First
FIRST FINANCIAL TRUST YOUR FUTURE FIRST 41
Slide 42: Growth in Trust Assets
Growth in Trust Assets Total Trust Assets – Book Value/Fair Value (in millions) Book Value Fair Value $5,599 $5,132 $4,373 $4,294 $3,759 $3,870 $3,866 $3,361 $3,374 $3,060 $2,774 $2,465 2013 2014 2015 2016 2017 2018 42
Slide 43: Total Trust Fees
Total Trust Fees Growth in FFTAM Fees (in thousands) $28,181 $23,694 $18,766 $19,252 $19,636 $16,317 2013 2014 2015 2016 2017 2018 43
Slide 44: Revenue from Mineral Management
Revenue from Mineral Management Growth in Mineral Management (in thousands) $4,821 $3,150 $2,648 $2,413 $2,005 $1,709 2013 2014 2015 2016 2017 2018 44
Slide 45: Total Trust Net Income
Total Trust Net Income Growth in FFTAM Net Income (in thousands) $13,532 $8,579 $7,109 $7,449 $7,190 $6,142 2013 2014 2015 2016 2017 2018 45
Slide 46: Managed Equity Styles
Managed Equity Styles Equity Income Core Domestic Core Diversified Core World Strategic Growth 46
Slide 47: First Financial Trust Your Future First
FIRST FINANACIAL TRUST YOUR FUTURE FIRST 47
Slide 48: Trust Locations
Trust Locations Abilene Sweetwater Beaumont San Angelo Fort Worth Stephenville Houston Odessa 48
Slide 49: Book Value of Trust Assets
BOOK VALUE OF TRUST ASSETS (in millions) $4,500 $4,000 $3,500 $3,000 $2,500 $2,000 $1,500 $1,000 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 49
Slide 50: First Financial Trust Your Future First
FIRST FINANCIAL TRUST YOUR FUTURE FIRST 50
Slide 51: Annual Shareholders' 2019 Meeting
ANNUAL SHAREHOLDERS’ 2019MEETING 51
Slide 52: 32nd Consecutive Year of Increased Earnings
32nd Consecutive Year of Increased Earnings FFIN Earnings (in millions) * Adjusted for tax rate change $150.6 $120.4 $0.66* $100.4 $104.8 $89.6 $7.65* $78.9 2013 2014 2015 2016 2017 2018 52
Slide 53: Improvements for 2019
Improvements for 2019 Improve Our Interest Rate Margin Grow Loans and Deposits 53
Slide 54: Improvements for 2019
Improvements for 2019 Grow Mortgage & Trust Increase Our Fee Income 54
Slide 55: Improvements for 2019
Improvements for 2019 Control Expenses Continue to Improve Credit Quality 55
Slide 56: Improvements for 2019: Make Another Acquisition
Improvements for 2019 Make Another Acquisition 56
Slide 57: Commercial State Bank–Kingwood Acquisition
Commercial State Bank –Kingwood Acquisition Consummated January 1, 2018 4 Branches in Kingwood, El Campo, Fulshear, Palacios $390.2 million in Assets as of December 31, 2017 $345.9 million in deposits $271.5 million in loans $59.4 million purchase price represents 13.78x last twelve months earnings
Slide 58: Commercial State Bank–Kingwood Acquisition
Commercial State Bank –Kingwood Acquisition Kingwood acquisition is consistent with our acquisition model of high growth areas, strong management and excellent earnings opportunity Provides diversification and fits well into our footprint Management and Board share same values to outstanding custome
Slide 59: Regions Across Texas
11 Regions Across Texas 59
Slide 60: Regions Across Texas: Abilene Region
11 Regions Across Texas Abilene Region Abilene Clyde Moran Albany Odessa Sweetwater Roby Trent Merkel Eastland Rising Star Ranger Cisco 23 Locations 60
Slide 61: Regions Across Texas: Hereford Region
11 Regions Across Texas Hereford Region Hereford 1 Location 61
Slide 62: Regions Across Texas: San Angelo Region
11 Regions Across Texas San Angelo Region San Angelo 2 Locations 62
Slide 63: Regions Across Texas: Cleburne Region
11 Regions Across Texas Cleburne Region Cleburne Burleson Alvarado Midlothian Waxahachie 6 Locations 63
Slide 64: Regions Across Texas: Stephenville Region
11 Regions Across Texas Stephenville Region Stephenville Granbury Glen Rose Acton Mineral Wells 7 Locations 64
Slide 65: Regions Across Texas: Weatherford Region
11 Regions Across Texas Weatherford Region Weatherford Aledo Willow Park Brock 6 Locations 65
Slide 66: Regions Across Texas: Southlake Region
11 Regions Across Texas Southlake Region Southlake Trophy Club Keller Bridgeport Boyd Decatur Grapevine 7 Locations 66
Slide 67: Regions Across Texas: Southeast Texas Region
11 Regions Across Texas Southeast Texas Region Orange Port Arthur Vidor Mauriceville Newton Beaumont 6 Locations 67
Slide 68: Regions Across Texas: Conroe Region
11 Regions Across Texas Conroe Region Conroe Montgomery Cut and Shoot Willis Tomball Spring Magnolia Huntsville New Waverly 10 Locations 68
Slide 69: Regions Across Texas: Fort Worth Region
11 Regions Across Texas Fort Worth Region Fort Worth 1 Location 69
Slide 70: Regions Across Texas: Kingwood Region
11 Regions Across Texas Kingwood Region Kingwood El Campo Fulshear Palacios 4 Locations 70
Slide 71: Regions Across Texas: 73 Locations
11 Regions Across Texas Abilene Hereford San Angelo Cleburne Stephenville Weatherford Southlake Southeast Texas Conroe Fort Worth Kingwood 73 Locations 71
Slide 72: New Waverly Opened December 2018
New Waverly Opened December 2018 72
Slide 73: Spring Opened January 2019
Spring Opened January 2019 73
Slide 74: Orange Opened March 2019
Orange Opened March 2019 74
Slide 75: Management Changes
Management Changes March 2018 Will Christoferson Vice President –Marketing March 2018 Joseph Crouch President – Sweetwater Region May 2019 Michele Stevens Retires after 22 years of service—First Financial Bankshares 75
Slide 76: Management Changes
Management Changes April 2018 Austin Elsner President and CEO –Cleburne Region August 2018 Kirby Cason President –Huntsville Region April 2018 Tom O’Neil Retires after 20 years of service – Abilene, Eastland, and Cleburne Regions August 2018 Robert Pate Retires after 34 years of service – Huntsville
Slide 77: Management Changes
Management Changes September 2018 Andrea Smiddy-Schlagel Executive Vice President –Treasury Management December 2018 Justin Hooper President and CEO –Weatherford Region December 2018 John Ruzicka Chief Information Officer and Chairman, President and CEO –First Technology Services, Inc. December 2018
Slide 78: Management Changes
Management changes March 2019 Shelley Dacus President Kingwood Region April 2019 Marcus Morris President and CEO of Fort Worth Region 78
Slide 79: Management Changes
Management Changes December 2018 June Wideman Executive Assistant to Scott Dueser retires after 35 years of service 79
Slide 80: Board of Directors
Board of Directors Mike Denny President, Batjer and Associates, Inc. Robert C. Nickles, Jr. Executive Chairman of Alegacy Group, LLC 80
Slide 81: Total Return on Investment
Total Return on Investment Assume you owned 1,000 shares of FFIN stock on January 1, 2018 Stock cost in January 2018 $45,050 Dividend declared ($0.82 x 1,000 shares) $820 Increase in stock price during 2018 ($45.05 to $57.69 x 1,000 shares) $12,640 2018 return on investment 28.06% 2017 return on inv
Slide 82: Strong Stock Performance
Strong Stock Performance 400% 350% 300% 250% 200% 150% 100% 50% 0% -50% -100% Dow Jones NASDAQ S&P 500 FFIN 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 82 82
Slide 83: Dividends Per Share
Dividends Per Share Annual Dividends Declared Per Share $0.82 $0.75 $0.62 $0.70 $0.55 2014 2015 2016 2017 2018 83
Slide 84: Stock Split and Increased Cash Dividend
Stock Split and Increased Cash Dividend Two-for-One Stock Split 100% Stock Dividend Effective Shareholders of record as of May 15, 2019 Distribution Date June 3, 2019 84
Slide 85: Stock Split and Increased Cash Dividend
Stock Split and Increased Cash Dividend Increase cash divided to $0.12 per quarter – 14.3% increase Shareholders of record as of June 17, 2019 Dividend payable July 1, 2019 85
Slide 86: First Financial Bankshares Inc
FIRST FINANCIAL BANKSHARES INC TM 86
First Financial Bankshares — Shareholder Meeting (April 2019) on 6ix