Fifth Third Bancorp · NASDAQ:FITB
Fifth Third Bancorp — Lehman Brothers Financial Services Conference 2004
24 slides from Fifth Third Bancorp's conference presentation, Sep 14, 2004
Slide 1: The More Things Change…
Exhibit 99.1 Exhibit 2004 “The George President September More Lehman A. 99.1 Chief Schaefer, 14, Things Brothers 2004 Executive Change…” Jr. Financial OfficerServices Conference
Slide 2: The More Things Change… Relative Value Of Free Funding and Deposit Franchise
“TheRelative Things The More ThatThings Have ValueChanged… Change…” Of: I. Free Funding II. A Deposit Franchise
Slide 3: The Compression in Value of Free Funding
I. The Compression Net Rate 1994 2.00 2.50 3.00 3.50 4.00 4.50 1997 2000 1999 2002 0.50 0.60 0.70 0.80 0.90 3 0.10 0.20 Interest 0.40 Spread 1995 1998 2001 2003 Value 0.30 1996 Q2-04 Margin and ofbetween Value a Margin Free-Funded Interest ofmargin Free % Spread Funding and Balance spread Value %She
Slide 4: The Relative Value of A Deposit Franchise
II.6.5 7 Earning 3.5 3.6 Q2-04 Q1-04 Q4-03 Q3-03 Q2-03 Q1-03 Q4-02 Q3-02 Q2-02 Q1-02 Spread 4 The 3 2.5 3.9 6 Relative 5.5 4.2 between Between Asset 2 5 4.5 Yields Value deposit 4Deposit %ofcost A Cost Deposit and andasset Asset Franchise yields Yields has decreased by 44 basis points since Q1-2002
Slide 5: …The Things That Stay The Same
“…The The Things I. II. III. IV. V. Affiliate Balance Metropolitan Relentless Business Same” That More Operating Sheet Have Ownership They Scorekeeping Market Integrity Not Stay Model Changed… Focus VIII. X.IX. VI. The Approach VII. Focus Superior Opportunity Deposit ontoCredit Efficiency Acquisitio
Slide 6: Affiliate Operating Model
I. Affiliate FITB Cincinnati Western Chicago Detroit Cleveland Indianapolis Columbus Dayton Toledo Southern Louisville Lexington Northern Nashville Ohio Florida 6 Valley Affiliates OH MI FL OH Michigan IL Michigan Kentucky Indiana TN OH KY Bank OH 1.0 6.4 4.8 9.4 4.8 OH IN 1.6 2.6 5.5 1.8 1% 7% 5.2
Slide 7: Metropolitan Market Focus: Distribution, Fifth Third Deposits
II. Metropolitan Distribution, Fifth Population Chicago Detroit Cleveland-Lorain Cincinnati Indianapolis Columbus Grand Louisville, Dayton-Springfield Toledo Naples Huntington Source: 7 Third Rapids OH FL MI SNL 8.45 OH 0.30 OH-KY-IN 4.46 KY-IN Rank MSA 0.62 WV IN Convenience Branch 7Muskegon- 1.58
Slide 8: Business Incentives and P&L Aggregation
III. Business Incentives Aggregation Bancorp Affiliate Retail Banking Midlevel Profit P&L’s Center Investment P&L’s Presidents P&L Consumer &and Midlevel of Ownership Profit P&L’s Management Profit Commercial Advisors Center P&L’s & and Midlevel Loss Profit Performance Banking Statements Center & Mi
Slide 9: Relentless Scorekeeping: Consumer Checking Campaign
IV. Relentless 2004 June Consumer New Affiliate Florida Louisville Southern Chicago Nashville Cleveland Ohio Columbus Dayton Detroit Indianapolis Lexington Toledo Cincinnati Northern Western Bancorp Account Accounts 21st Valley Summer 9,500 11,100 2,200 12,000 Michigan 23,500 Goal 180,000 Kentucky M
Slide 10: Balance Sheet Integrity: Balance Among Risk
V. Balance Among Risk FITB (Originally 29.0 31.0 33.0 35.0 32.2 32.3 31.9 29.2 34.5 31.7 29.1 30.3 31.2 15.0 17.0 19.0 21.0 23.0 25.0 Tangible Top 1996 2.0 4.0 6.0 Percent 8.0 10.0 10 25 Based 1997 Securities Avg. 27.0 the Equity 1998 Sheet Reported) Strongest Ratio FITB /1999 Integrity Assets Tangi
Slide 11: Credit Culture: NPAs and Favorable Credit Comparison
VI. NPAs 1 1.2 1.4 1.25 0.2 0.4 0.6 0.8 1.12 1.17 0.7 0.85 0.94 0.95 1.011.05 1.07 0.59 0.65 0.42 3Q00 Fifth Top Favorable Growth Q2-04 # > $3MM $1MM $500M $200M < $ 11Percent Of 165,786,299 $7MM $200M 0.75 Superior 25 1.291.25 1.15 0.620.62 Credits Third 1Q01 /Commercial to Bank Loans to from 0816
Slide 12: Superior Focus on Deposit Growth: Average Loans and Deposits
VII. 20,000 25,000 35,000 Avg. 10,000 15,000 Loans All 10-year Checking Interest $ 80,000 90,000 100,000 60,000 70,000 Avg 30,000 1998 YTD 12Millions balances Deposit Loans Demand 1999 Q204 &50,000 CAGR Leases 19.1 2000 &restated Focus Leases &40,000 %9.9 2001 NOW Demand %Avg for 2002 Total past Ass
Slide 13: Approach to Acquisitions
VIII. I. II. III. IV. V. VI. VII. TBD 13 Deposit Markets Low Focus Low Management Manageable Approach VIII. Credit Market on Rich Growth WeTop Risk Know Metropolitan toShare Size Participation Line Acquisitions Revenue Markets
Slide 14: Efficiency Focus: Net Income per Full Time Equivalent Employee
IX.in Net 40 ($ Columbus Toledo West Dayton North. Southern OH Louisville Detroit Cleveland Indianapolis Lexington Cincinnati Chicago 166 Florida 100 65 72 63 YTD $93,567 14 80 2003 49 Focus Valley Income YTD 159 000’s) Mich 2004 120 MI KY 141 IN 6-30-04 on 160 (HQ) vs. Per 95 Efficiency $92,809 139
Slide 15: The Opportunity: Fifth Third Market Share
X. The Fifth FITB Ohio 12.1% 0.0% 15 Third Michigan 5.0% State 8.6% Opportunity has 10.0% Market 6.5% less Indiana 6.5% 15.0% Share thanKentucky 2.3% 6% 20.0% market 6.9% Illinois share 5inState the core Totalfive-state footprint Fifth Third has a 6% market share on a combined basis in MSA’s MSA’s g
Slide 16: One Thing That Has Not Changed… We Are Investors
One WE I. II. III. IV.In In In ARE A More People Florida Technology Franchise INVESTORS: Thing That Has Not Changed…
Slide 17: Investing in A Retail Franchise: Banking Centers
Investing 116 2004(9/30) 59 # 10 15 Banking 20 25 Centers 30 35 3 0 9 11 12 6 4 2 Chicago Columbus 1701347New 29 34new 3428 54 Detroit Banking InTennessee 2003 A Retail W. 2002 Centers Mich Franchise S. Indiana Indianapolis openedToledo fromCincinnati January N. Mich2002 Dayton Cleveland throughFlor
Slide 18: Investing in A Retail Franchise: De-Novo Growth
Investing 116 $366 350 50 150 250 $780 $ 700 800 900 Q 0 100 200 300 400 500 18 Q2-04 Q1-04 Q4-03 Q3-03 Q2-03 Q1-03 Q4-02 Q3-02 Q2-02 1-02 in New Millions Million De-Novo In A600 inRetail Loan Deposit Branches Franchise Growth…. Growth…. Since 2002 Driving….
Slide 19: Investing in De-Novo Banking Centers Results
Investing De-Novo Average Time 6 1 35 0 5 10 15 20 25 17 11 3 2 New Q3-04 Q2-04 Q1-04 Q4-03 Q3-03 Q2-03 Q1-03 Q4-02 Q3-02 Q2-02 Q1-02 826,000 555,000 19024year months 12 15Banking Opened: 12 111,608 in Net 86,656 $Banking Inmonthly (14,170) AIncome Centers Retail 6,415,752 2,607,541 Center deposit l
Slide 20: Investing In People: Commercial Sales Force and C&I Growth
Investing In Fifth 580 440 460 C&I Industry 16 Jun-04 Mar-04 Dec-03 Sep-03 Jun-03 Mar-03 Dec-02 Sep-02 Jun-02 Mar-02 Dec-01 FITB Source: 20 a15420 560 period Loan Third $'s 14Federal 540 400 $'s Fifth in 13 InGrowth of increased Billions in 12 People 520 declining Third Billions 11 Reserve 10 C&I 9
Slide 21: Investing In Technology
Investing New Grand Yesterday Replication (Intuitive ACE Today Cincinnati Next (customer-centric Check Operational Business 21 Sales Generation Rapids Imaging Intelligence Web In&Site CRM Technology Management interface) presentation) Tools
Slide 22: Investing In Florida: Market Position
Investing Population Naples Orion Florida Tampa Sarasota Royal Northern Gold BB&T Century Orlando Washington FFLC South Villages Cape Deposit Institution Bank Wachovia SunTrust FITB Colonial AmSouth Golden Third Fifth First 22 National Citizens Third Banc Coral of Pro FS&LA Bancorp Financial Bank 1,
Slide 23: Investing In Fifth Third Bank Florida: June 2004 Results
Investing Fifth June Net Total Avg. ($ 23 inIncome 2004 000’s) Total Demand Interest Savings Third Net In Revenue June Deposits Loans Bank YTD Florida Checking.……….. &Deposits 2003 MMDA (Florida) &$5,798 YTD……… YTD Leases % $Change $$4,642 125,300 $76,800 as $827,000 699,200 of 6-30-2004 $25 $25,717
Slide 24: Forward Looking Statements
Forward This Act uncertainties. “anticipates,” expressions. such prepayment Bankshares funding other These Investors information. statement/prospectus Third First transaction Shareholders 24 ofpresentation aNational economic factors Bancorp, Bancorp documents 1933, difference and Looking and contemp
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