F.n.b. Corporation · NYSE:FNB
F.n.b — Q3 2015 Earnings Presentation
45 slides from F.n.b's earnings presentation, Nov 3, 2015
Slide 1: F.N.B. Corporation Investor Presentation
F.N.B. Corporation Investor Presentation
Slide 2: Cautionary Statement Regarding Forward-Looking Information and Non-GAAP Financial Information
Cautionary Statement Regarding Forward-Looking Information and Non-GAAP Financial Information The presentation includes “snapshot” information about F.N.B. Corporation used by and of illustration and is not intended as a full business or financial review and should be viewed in the context of all th
Slide 3: Cautionary Statement Regarding Forward-Looking Information and Non-GAAP Financial Information
Cautionary Statement Regarding Forward-Looking Information and Non-GAAP Financial Information This presentation contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act, relating to present or future trends or factors affecting the banking industry and
Slide 4: F.N.B. Corporation
F.N.B. Corporation About F.N.B. Corporation Experienced Leadership Team Favorably Positioned for Long-Term Success Strong Operating Trends 4
Slide 5: About F.N.B. Corporation
About F.N.B. Corporation • Headquarters: Pittsburgh, PA • Assets: $19.8 billion(1) High-Quality, • Loans: $14.1 billion(1) Growing Regional Financial Institution • Deposits: $15.8 billion(1) • Banking locations: 328(1) • Market Capitalization: $2.4 billion(2) • Attractive and expanding footprint: Ba
Slide 6: Experienced Leadership Team
Experienced Leadership Team Experienced and respected executive management team has guided FNB through the cycle, and positioned the Company for long-term, sustained growth Years of Banking Experience Joined FNB Prior Experience President and CEO Vincent J. Delie, Jr. 28 2005 National City Chief Fin
Slide 7: Proven sustainable business model that can be scaled as the franchise continues to grow
Proven sustainable business model that can be scaled as the franchise continues to grow Sustainable Business Model Risk Management Growth Culture Shareholder Value Maintain low risk Position for sustainable Named best place to Disciplined, growth profile organic growth work 5 years in a row
Slide 8: Reposition and Reinvest – Actions
Reposition and Reinvest – Actions 2009-2010 2011 2012 2013 2014 2015 PEOPLE Talent Management Chief Technology & Chief Wholesale Strengthened team Chief Marketing Banking and Chief through key hires; Attract, retain, develop best talent Officer Filled, Consumer Banking Continuous team Launched Proje
Slide 9: Comparative 9/30/2015 YTD Trends – Positioned for Long-Term Growth
Comparative 9/30/2015 YTD Trends – Positioned for Long-Term Growth YTD Operating Trends Operating Earnings Per Share(1) Total Operating Revenue(1)(2) 10% Year-Over-Year $0.66 $495,401 Operating EPS Growth $0.59 $455,236 Investments in fee-based businesses and continued organic loan growth support
Slide 10: Total Operating Revenue Growth
Total Operating Revenue Growth Total Operating Revenue Trends(1) $161.8 $161.9 $165.3 $168.2 $158.8 $125.4 $123.7 $125.6 $127.2 $122.4 $36.4 $36.4 $38.2 $39.7 $41.0 3Q14 4Q14 1Q15 2Q15 3Q15 Operating Non-Interest Income Net Interest Income Total Operating Revenue 3Q15 record total revenue of $165.
Slide 11: Full Year Financial Highlights – Annual Trends
Full Year Financial Highlights – Annual Trends 2014(5) 2013 2012 2011 2010 Net income available to common shareholders Quality ($ millions) $135.6 $123.5 $117.8 $90.3 $68.2 Operating Earnings(1) Earnings per diluted common share $0.80 $0.84 $0.84 $0.72 $0.60 ROTCE(1) 14.72% 17.35% 18.75% 16.32% 14.7
Slide 12: Transaction Deposit Growth - Strengthened Funding Mix
Transaction Deposit Growth - Strengthened Funding Mix Consistent Transaction Deposit Growth Results in Strengthened Deposit Mix Total Transaction Deposits and Customer Repos Mix 24% 21% 20% 29% 27% 26% 79% 80% 74% 76% 71% 73% 12/31/2010 12/31/2011 12/31/2012 12/31/2013 12/31/2014 9/30/2015 Transacti
Slide 13: Market Position
Market Position Strong Market Position Acquisition-Related Expansion Enhances Organic Growth Opportunities 13
Slide 14: Disciplined Acquisition Strategy – Platform for Organic Growth
Disciplined Acquisition Strategy – Platform for Organic Growth Disciplined and Consistent Acquisition Strategy Strategy Disciplined identification and focus on markets that offer potential to leverage core competencies and growth opportunities Criteria Recoup diminution of capital in short t
Slide 15: FNB Acquisitions Position the Company for Long-term Sustainable Organic Growth
FNB Acquisitions Position the Company for Long-term Sustainable Organic Growth Acquisition History – Total Assets (in $ billions) Metro OBA Bancorp, Parkview Assets: Inc. Assets: $0.4 bn Assets: $0.8 bn $3.0 bn North East Omega Assets: Assets: $0.1 bn $1.8 bn BCSB Annapolis Assets: Bancorp $0.6 bn A
Slide 16: FNB Banking Footprint
FNB Banking Footprint FNB Recent Acquisition Summary FNB Deposit Market Region MSA Share Population 2.4 Million Pittsburgh #3 (#22 MSA) PVSA - Closed 1Q12, FITB Branches Cleveland MSA expected 1H16 2.7 Million Baltimore #8 (#20 MSA) ANNB - Closed 2Q13, BCSB - Closed 1Q14, Pittsburgh MSA OBAF - C
Slide 17: Metro Transaction Rationale
Metro Transaction Rationale FNB will become the largest regional bank and second largest bank based in Pennsylvania (1) FNB obtains immediate scale and #3 market share in the Harrisburg MSA with $1.4 billion in deposits(2) Attractive demographics with significant retail and commercial opportun
Slide 18: Metro Transaction Overview
Metro Transaction Overview $32.72 per Metro Bancorp, Inc. share(1) Consideration Fixed 2.373x exchange ratio 100% stock Deal Value Approximately $474 million(1) Gross Credit Mark 4.9% (credit diligence covered over 80% of commercial portfolio) Detailed Due Diligence Completed Customary
Slide 19: MSA Market Share - Proven Success, Opportunity For Growth
MSA Market Share - Proven Success, Opportunity For Growth Established MSA Markets – Proven Success, Leading Share Position Achieved Pittsburgh, PA MSA Harrisburg-Carlisle, PA MSA Total Deposits Market Total Deposits Market Rank Institution 2015 ($000) Share (%) Rank Institution 2015 ($000) Share (%)
Slide 20: Operating Results
Operating Results 3Q15 Highlights and Trends 20
Slide 21: 3Q15 Operating Highlights
3Q15 Operating Highlights Continued High-Quality Earnings and Positive Trends (All comparisons refer to the second quarter of 2015, except as noted) Operating(1) net income available to common shareholders of $38.9 million; earnings per diluted common share of $0.22 5% year-over-year increase in
Slide 22: 3Q15 Operating Highlights (cont’d)
3Q15 Operating Highlights (cont’d) Continued High-Quality Earnings and Positive Trends (All comparisons refer to the second quarter of 2015, except as noted) Solid profitability performance Return on average tangible assets of 1.06%(1), Return on average tangible common equity of 14.43%(1) Cor
Slide 23: 3Q15 Financial Highlights – Quarterly Trends
3Q15 Financial Highlights – Quarterly Trends Current Prior Prior-Year Quarter Quarter Quarter 3Q15 2Q15 3Q14 Operating Net income available to common shareholders ($ millions) $38.9 $38.4 $35.0 Earnings(1) Earnings per diluted common share $0.22 $0.22 $0.21 ROTCE(1) 14.43% 14.58% 14.96% ROTA(1) 1.06
Slide 24: Asset Quality Results
Asset Quality Results(1) $ in Thousands 3Q15 2Q15 3Q14 3Q15 Highlights Continued stable credit quality results marked NPL’s+OREO/Total loans and 0.99% 1.05% 1.25% by favorable total delinquency and leases+OREO NPL’s+OREO levels Delinquency 0.89% 0.86% 1.06% NPL’s+OREO/Total loans and leases+OREO
Slide 25: Asset Quality Trends
Asset Quality Trends NPL’s+OREO/ NCO’s Originated Loans and Leases/ Total Originated Loans and Leases + OREO(1)(2) Total Originated Loans and Leases(1)(3) 3.50% 1.40% 3.00% 2.74% 1.20% 2.50% 1.00% 2.15% 2.00% 0.80% 1.60% 0.77% 1.50% 1.44% 0.60% 1.13% 1.08% 1.05% 0.99% 0.62% 1.00% 0.40% 0.41% 0.50% 0
Slide 26: Balance Sheet Highlights – Quarterly Averages
Balance Sheet Highlights – Quarterly Averages Organic 3Q15 Growth(1) Average Balances, $ in Millions Balance $ % 3Q15 Highlights Continued high-quality balance sheet Securities $3,089 - - growth, including solid organic growth Strengthened funding mix Total loans $11,764 $231.5 8.0% Transactio
Slide 27: Net Interest Margin
Net Interest Margin Net Interest Margin Trends(1) 3.63% 3.54% 3.48% 3.43% 3.39% 0.11% 0.05% 0.05% 0.04% 0.01% 3.52% 3.49% 3.43% 3.39% 3.38% 3Q14 4Q14 1Q15 2Q15 3Q15 Core Net Interest Margin Accretable Yield Benefit Net Interest Income / Net Interest Margin Third quarter 2015 net interest income in
Slide 28: Efficiency Ratio Trends
Efficiency Ratio Trends Efficiency Ratio Trends FNB Efficiency Ratio Relative to Peers FNB’s efficiency ratio continues to trend favorably relative to peers Upper quartile results 3Q15 marks 14th consecutive quarter with an efficiency ratio under 60% 65% 64% 64% 64% 63% 61% 61% 61% 60% 59% 58%
Slide 29: Investment Thesis
Investment Thesis Long-Term Investment Thesis 29
Slide 30: Long-Term Investment Thesis
Long-Term Investment Thesis FNB’s long-term investment thesis reflects a commitment to efficient capital management and creating value for our shareholders Long-Term Investment Thesis: Targeted Annual Total Return for Shareholders of 9-12% Thesis Centered on a Balanced Combination of Capital Managem
Slide 31: Return on Average Tangible Common Equity Trends (ROATCE)
Return on Average Tangible Common Equity Trends (ROATCE) ROATCE Trends(1) 1Q14 = First full quarter impact of 4Q13 capital actions taken to position FNB for Basel III 18.75% 17.35% 16.32% 14.71% 14.72% 15.13% 14.58% 14.43% 11.21% 11.81% 11.03% 10.74% 10.38% FNB 6.98% Peer Median 5.23% 2010 2011 2012
Slide 32: High-Quality, Consistent Operating Results
High-Quality, Consistent Operating Results FNB’s ability to deliver consistent operating results exceeds peer results FNB and Peer Volatility (Standard Deviation 1Q10 – 2Q15) ROAA Volatility Revenue/Avg Assets Volatility 0.25% 0.080% 0.070% 0.20% 0.060% 0.15% 0.050% 0.040% 0.10% 0.030% 0.020% 0.05%
Slide 33: Dividend Yield Trends Relative to Peers
Dividend Yield Trends Relative to Peers Dividend Yield as of Respective Period-End(1) 4.89% 4.52% 4.24% 3.80% 3.65% 3.71% 3.60% 3.35% 2.44% 2.20% 2.15% 2.15% 1.92% 1.97% 1.16% FNB Peer Median 2010 2011 2012 2013 2014 1Q15 2Q15 3Q15 FNB % 2010 2011 2012 2013 2014 1Q15 2Q15 Ranking(2) 93rd 92nd 92nd 9
Slide 34: Capital and Tangible Book Value
Capital and Tangible Book Value Tangible Common Equity Ratio Tangible Book Value Per Share $6.36 6.93% 6.98% $6.22 6.89% $5.91 Tangible Common Equity Tangible Book Value September 30, 2014 June 30, 2015 September 30, 2015 FNB capital ratios continued to exceed federal bank regulatory agency “well
Slide 35: Supplemental Information
Supplemental Information 35
Slide 36: Supplemental Information Index
Supplemental Information Index Diversified Loan Portfolio Deposits and Customer Repurchase Agreements Investment Portfolio Loan Risk Profile Regency Finance Company Profile Regional Peer Group Listing GAAP to Non-GAAP Reconciliation 36
Slide 37: Diversified Loan Portfolio
Diversified Loan Portfolio 9/30/2015 CAGR % of Portfolio ($ in millions) 12/31/08- $11.9 Billion Loan Portfolio Balance 9/30/15 12/31/08 9/30/15 September 30, 2015 C&I $2,491 15.4% 16% 21% Other 2% Regency 1% Indirect 8% Florida 0% CRE: Non-Owner Occupied 2,405 15.1% 16% 20% Residential Commercial L
Slide 38: Deposits and Customer Repurchase Agreements
Deposits and Customer Repurchase Agreements 9/30/2015 CAGR Mix % $13.0 Billion Deposits and ($ in millions) 12/31/08- Customer Repo Agreements Balance 9/30/15 12/31/08 9/30/15 September 30, 2015 Savings, NOW, MMDA $7,295 15.1% 44% 56% Non-Interest Bearing 22% Non-Interest Bearing 2,911 18.6% 14% 22%
Slide 39: Investment Portfolio
Investment Portfolio % Ratings Highly Rated $3.2 Billion Investment Portfolio ($ in millions(1)) Portfolio Investment % September 30, 2015 Agency MBS $1,266 40% AAA 100% Ratings Composition CMO Agency 990 31% AAA 100% Agency Senior Notes 537 17% AAA 100% AAA 3% AA 74% AAA, 92.2% Municipals 239 8% A
Slide 40: Loan Risk Profile
Loan Risk Profile YTD Net Charge- Total Past (1) (1) $ in millions 9/30/2015 % of Loans NPL's/Loans Offs/Loans Due/Loans(1) Commercial and Industrial $2,491 21.0% 0.41% 0.07% 0.56% CRE: Non-Owner Occupied 2,405 20.3% 0.32% 0.05% 0.45% CRE: Owner Occupied 1,534 12.9% 1.42% 0.18% 1.56% Home Equity and
Slide 41: Regency Finance Company Profile
Regency Finance Company Profile Consumer finance business with over 80 years of consumer lending experience Credit quality: 9/30/2015 YTD net charge-offs to average loans of 3.94% Returns: 9/30/2015 YTD: ROA 3.79%, ROE 40.46%, ROTE 46.15% Regency Finance Company $181 Million Loan Portfolio Pen
Slide 42: Regional Peer Group Listing
Regional Peer Group Listing Ticker Institution Ticker Institution ASB Associated Bancorp ONB Old National Bancorp BXS Bancorp South PVTB Private Bancorp, Inc. CBSH Commerce Bancshares, Inc. SBNY Signature Bank FCF First Commonwealth SNV Synovus Financial Corp. FHN First Horizon National Corp. TCB TC
Slide 43: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation Operating Return on Average Tangible Common Equity Operating Return on Average Tangible Assets For the Nine Months Ended For the Quarter Ended September 30, September 30, 2015 June 30, 2015 September 30, 2014 2015 2014 Operating net income Net income available to comm
Slide 44: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation Total Operating Revenue For the Quarter Ended For the Nine Months Ended September 30, 2015 June 30, 2015 March 31, 2015 December 31, 2014 September 30, 2014 September 30, 2015 September 30, 2014 Total Revenue Net Interest Income (FTE) $ 127,151 $ 125,572 $ 123,704 $ 1
Slide 45: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation Operating Return on Average Tangible Common Equity Operating Return on Average Tangible Assets Year Ended December 31, 2014 2013 2012 2011 2010 Operating net income Net income available to common shareholders $135,698 $117,804 $110,410 $87,047 $74,652 Add: Merger and