Park National Corporation · AMEX:PRK
Park National — Keefe, Bruyette & Woods Community Bank Investor Conference 2016
29 slides from Park National's conference presentation, Aug 1, 2016
Slide 1: KBW Community Bank Investor Conference
August 2-3, 2016 Keefe, Bruyette & Woods Community Bank Investor Conference 1
Slide 2: Safe Harbor Statement
Safe Harbor Statement Park cautions that any forward-looking statements contained in this presentation or made by management of Park are provided to assist in the understanding of anticipated future financial performance. Forward-looking statements provide current expectations or forecasts of future
Slide 3: Park National Corporation (PRK) Profile
Park National Corporation (PRK) Profile (as of June 30, 2016) • 11 Community Bank Divisions • 2 Specialty Finance Companies • One non-bank workout subsidiary • 29 Ohio counties • 112 bank branches • 6 specialty finance offices • 1,778 FTEs 3
Slide 4: Park Executive Management
Park Executive Management David L. Trautman – President and CEO– Age: 55 President , CEO and Board Member of The Park National Bank and Park National Corporation (Park) headquartered in Newark, Ohio. He served as President of First-Knox National Bank, a division of The Park National Bank, from May
Slide 5: Park Executive Management (continued)
Park Executive Management (continued) Brady T. Burt – Chief Financial Officer – Age: 44 Chief Financial Officer of Park since 2012. Formally served as the Chief Accounting Officer with Park since April 2007. Prior to joining Park, Mr. Burt served Vail Banks, Inc. in various capacities, including E
Slide 6: Experienced Leadership Team
Experienced Leadership Team Name Position Age Years with PRK Years In Industry David L. Trautman President & CEO 55 33 33 C. Daniel DeLawder Chairman 66 45 45 Brady T. Burt Chief Financial Officer 44 9 15 Senior leadership consists of executives with proven local market experience Leadership tea
Slide 7: Leadership Team – continued
Leadership Team – continued Name Position Age Years with PRK Years In Industry Adrienne M. Brokaw SVP – Director of Internal Audit 48 3 17 Thomas J. Button SVP – Chief Credit Officer 56 19 30 Thomas M. Cummiskey SVP – Trust 46 16 18 Robert N. Kent, Jr. President – Scope Aircraft Finance 58 13 33 Tim
Slide 8: Affiliate Leadership
Affiliate Leadership Name Position Age Years with PRK/Affiliate Years In Industry Brett A. Baumeister President – Unity National Bank 50 12 26 John A. Brown President – Security National Bank 47 25 25 David J. Gooch President – Park National Bank of Southwest Ohio & Northern Kentucky 47 19 25 Chris
Slide 9: Highlights of the First Six Months of 2016
Highlights of the First Six Months of 2016 • Loan growth of $64.4 million in 2Q 2016 (5.2% annualized) and $58.9 million year-to-date (2.36% annualized) at Park’s Ohio subsidiary, The Park National Bank. • Credit quality remains strong: Park National Corporation experienced annualized net charge-off
Slide 10: PRK and PRK excluding SEPH ROA and ROE History
PRK and PRK, excluding Vision & Southeast Property Holdings, LLC (SEPH) ROA and ROE History 1 Calculated using average common equity for Park National Corporation. 2 Calculated using average common equity for Park National Corporation, excluding Vision Bank and SE Property Holdings, LLC. 3 Adjusted
Slide 11: Total Return Performance Park National Corporation
Total Return Performance Park National Corporation The total return performance graph depicts the yearly change in Park’s cumulative total shareholder return over the five-year period from December 31, 2010 to December 31, 2015. Calculations include the reinvestment of dividends and are indexed to t
Slide 12: The Park National Bank – The bank of choice
The Park National Bank – The bank of choice Source: SNL, June 30, 2015 Headquarter Counties – Deposits (in thousands) Bank Division Year Joined Park Hdqtr. Co. Deposits Total County Deposits % of 2015 Market Share % of 2014 Market Share 2015 Headquarter County Market Share Rank 2014 Headquarter Coun
Slide 13: Park National Corporation – Income Statement
Park National Corporation – Income Statement Source: Company Filings Note: Prior period results were updated to reflect the January 1, 2015 adoption of Accounting Standards Update (ASU) 2014-01, Accounting for Investments in Qualified Affordable Housing Projects. The adoption of this ASU required re
Slide 14: Park National Corporation Statement of Condition
PARK NATIONAL CORPORATION Statement of Condition Source: Company Filings (in millions) June 30, 2016 Dec. 31, 2015 Dec. 31, 2014 Investment securities $ 1,548 $ 1,644 $ 1,501 Loans 5,128 5,068 4,830 Allowance for loan losses (59) (56) (54) Other assets 815 655 724 Total assets $ 7,432 $ 7,311 $ 7,00
Slide 15: Quarterly Net Income by Operating Segment
Quarterly Net Income by Operating Segment Source: Company Filings (In thousands) Q2 2016 Q1 2016 Six months YTD 2016 Six months YTD 2015 2015 2014 PNB $ 21,078 $ 21,744 $ 42,822 $ 40,492 $ 84,345 $ 82,907 GFSC 626 (1,836) (1,210) 688 1,423 1,175 Park Parent Company 1 (1,069) (1,834) (2,903) (969) (4
Slide 16: The Park National Bank Income Statement
Source: Company Filings The Park National Bank Income Statement (In thousands) Q2 2016 Q1 2016 Six months YTD 2016 Six months YTD 2015 2015 2014 Net interest income $ 56,006 $ 57,155 $ 113,161 $ 108,587 $ 220,879 $ 218,641 Provision for (recovery of) loan losses 1,362 1,533 2,895 4,742 7,665 3,517 F
Slide 17: Park National Bank Statement of Condition
Park National Bank Statement of Condition Source: Company Filings (In thousands) June 30, 2016 December 31, 2015 June 30, 2015 % change from 12/31/15 % change from 6/30/15 Loans $ 5,088,014 $ 5,029,072 $ 4,860,342 1.17% 4.68% Allowance for loan losses 56,293 54,453 55,242 3.38% 1.90% Net loans 5,031
Slide 18: Park National Bank Loans by Type
Park National Bank Loans by Type Source: Company Filings as of June 30, 2016 • Commercial lending focus is on small, closely-held businesses within our markets. • Consumer mortgage and home equity portfolios are originated by Park within our footprint and have been consistently underwritten for deca
Slide 19: Park National Bank Nonperforming Loans by Type
Park National Bank Nonperforming Loans by Type At June 30, 2016 (in thousands) Commercial Real Estate - Owner Occupied 10% Commercial Real Estate Non-Owner Occupied 10% Residential Real Estate 43% Construction Real Estate 4% Commercial & Industrial 24% Consumer 3% Farmland 6% 19 Total Nonperforming
Slide 20: SEPH Nonperforming Loans by Type
SEPH Nonperforming Loans by Type At June 30, 2016 (in thousands) Residential Real Estate 81% Construction Real Estate 12% Commercial & Industrial 7% Total Nonperforming Loans = $13,787 20
Slide 21: Park National Corporation Nonperforming Assets
Park National Corporation Nonperforming assets 1 The carrying balance of impaired loans as a percentage of unpaid principal balance at June 30, 2016 was 73.4% and 46.8% for Park National Corporation and SEPH, respectively. 2 At June 30, 2016, Vision/SEPH participations included in Park National Corp
Slide 22: Source: BHC Performance Report and Company Filings (in thousands) June 30, 2016 Dec. 31,
Source: BHC Performance Report and Company Filings (in thousands) June 30, 2016 Dec. 31, 2015 Dec. 31, 2014 Non-accrual loans $ 97,642 $ 81,468 $ 77,477 Renegotiated loans 17,722 24,979 16,157 Loans past due 90 days or more (still accruing) 2,305 1,921 2,641 Total nonperforming loans $ 117,669 $ 108
Slide 23: PNB & GFC Nonperforming Loans Supplemental Information
PNB & GFC Nonperforming Loans Supplemental Information 23 7 Year Average NCOs as a % of Average Loans Loan Category PNB, including Guardian $3B - $10B Peer Group $3B - $10B Peer Group Median Commercial, financial & agricultural 0.72% 0.94% 0.83% Commercial real estate 0.27% 0.62% 1.56% Consumer 1.54
Slide 24: Park National Bank Commercial Loan Portfolio Trends
Park National Bank Commercial Loan Portfolio Trends 1 Commercial loans include: (1) Commercial, financial and agricultural loans, (2) Commercial real estate loans, (3) Commercial related loans in the construction real estate portfolio and (4) Commercial related loans in the residential real estate p
Slide 25: PRK comparison to peers
PRK comparison to peers 1 Calculated for the six months ended June 30, 2016. 2 Annualized based on dividends and stock price through June 30, 2016. 3 Due to unavailability of 2Q 2016 peer median financial metrics, data utilized herein reflects 1Q 2016 peer results. Source: Company Filings and SNL da
Slide 26: A Successful History of Disciplined Strategic Growth in Ohio
A Successful History of Disciplined Strategic Growth in Ohio (11 acquisitions; 2 De Novos) 1908 1908 The Park National Bank is established 1985 1985 Acquisition of Fairfield National Bank 1987 1987 Park National Corporation holding company is established Acquisition of Richland Trust Company
Slide 27: PRK M&A Strategy
PRK M&A Strategy Two prong strategy guidelines: • Traditional M&A • Strong franchise, good reputation • Good market share • Existing leadership continuity • Traditional community bank structure • Core deposits • Metro Strategy – Attractive markets in the Midwest / Mid-Atlantic states • Open de novo
Slide 28: 2016 PRK Agenda
2016 PRK Agenda 28 A. Consolidated Net Income => $85 million B. Maintain common dividend at historic rate C. Perform in upper quintile of $3-$10 billion bank holding company peer group D. Reduce NPA’s to peer levels E. At least maintain => 85% of key risk indicators in green/yellow condition F. Cult
Slide 29: KBW Community Bank Investor Conference
August 2-3, 2016 Keefe, Bruyette & Woods Community Bank Investor Conference 29
Park National — Keefe, Bruyette & Woods Community Bank Investor Conference 2016 on 6ix