First Financial Bancorp. · NASDAQ:FFBC
First Financial Bancorp — Investor Presentation (November 2016)
32 slides from First Financial Bancorp's investor presentation, Nov 16, 2016
Slide 1: Another step on the path to success
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Slide 2: Forward-looking statements
2 This investor presentation contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are not based on historical or current facts, but rather on our current beliefs, expectations, assumptions and projections about our busines
Slide 3: Presentation Contents
3 About First Financial Bancorp Strategic Direction Recent Financial Results Presentation Contents
Slide 4: Company Overview
4 Company Overview NASDAQ: FFBC Overview Founded: 1863 Headquarters: Cincinnati, Ohio Banking Centers: 101 Assets: $8.4 billion Loans: $5.8 billion Deposits: $6.3 billion Wealth Mgmt: $2.4 billion AUM Lines of Business Commercial / Private Banking C&I, O-CRE, ABL, Equipment Finance, Treasury, Wealth
Slide 5: Our Markets
Central OH Loans $1.0 billion Loan Growth (Y-o-Y) 30.4% Deposits $0.4 billion Deposit Market Share #16 (0.7 %) Banking Centers 6 Fortune 500 Companies 4 5 Our Markets Indianapolis Loans $0.5 billion Loan Growth (Y-o-Y) 29.7% Deposits $0.6 billion Deposit Market Share #14 (1.2%) Banking Centers 8 For
Slide 6: Through the Cycle
Proven Acquirer Two FDIC-assisted acquisitions totaling $2.5 billion in assets and generating a $343 million pre-tax bargain purchase gain (2009) Two branch acquisitions of 38 offices in Indiana and Ohio (2011) Three banks in Columbus, Ohio totaling $727 million in assets (2014) Oak Street Funding,
Slide 7: Investments in our Business
Product expansions Specialty lending (~ $1 billion, excluding Oak Street) Mobile banking & other technology enhancements for clients Re-entry into mortgage business (2010) 2015 originations of $320 million Wealth infrastructure improvements Investment model Real estate management, tax & insurance ou
Slide 8: Invest with First Financial
Proven & sustainable business model Well managed through the cycle Conservative operating philosophy Consistent profitability – 104 consecutive quarters Robust capital management Prudent steward of shareholders’ capital Strong asset quality Well defined M&A strategy Selective markets, products & ass
Slide 9: Total Shareholder Return
9 1 – includes dividend reinvestment 2 – simple average - assumes equal weight 3 – 2016 YTD through 10/26/2016 Total Shareholder Return 1 Company Ticker 2008-3Q16 2015 2016 YTD (3) First Financial FFBC 184.30% 0.68% 21.41% KBW Regional Bank Index KRX 40.59% 5.99% 8.60% NASDAQ Composite CCMP 122.25%
Slide 10: Strategic Direction
10 About First Financial Bancorp Strategic Direction Recent Financial Results
Slide 11: Strategic Overview
11 Operational Excellence • Focus on cost, efficiency & volume Client Intimacy • Strong client focus • Relationship driven Product Leadership • Develop new products, new markets & new techniques What does First Financial stand for? Strategic Overview
Slide 12: Our Strategy: Premier Business Bank
Our strategy is to be the Premier Business Bank in the markets we serve “Bank the business, bank the owner & bank the employees.” Rationale: Our value proposition – relationship banking & sophisticated solutions – resonates with and is desired by small / mid-size businesses Alignment with our compet
Slide 13: Connecting Strategy to Execution
13 Connecting Strategy to Execution 13
Slide 14: Strategic Priorities
14 Strategic Priorities Deliver top quartile shareholder returns Continue to invest in innovative solutions that enable our clients to bank with us on their terms Promote leadership & development within our communities Achieve best-in-class compliance & risk management programs Remain vigilant in ou
Slide 15: Recent Financial Results
15 About First Financial Bancorp Strategic Direction Recent Financial Results
Slide 16: 3Q 2016 Highlights
16 3Q 2016 Highlights – 104th Consecutive Quarter of Profitability Total assets increased $58.4 million, to $8.4 billion, compared to the linked quarter. EOP loans increased $88.3 million, or 6.2% annualized, compared to the linked quarter. EOP deposits increased $219.1 million, or 14.2% annualized,
Slide 17: Strategy & Outlook
17 Strategy & Outlook Focus remains on organic growth and executing our core strategy: 1. Growing loans at risk-appropriate returns Strong organic growth opportunities resulting from the mix of markets, products & businesses built over the last five years Full year 2016 loan growth trending toward h
Slide 18: Profitability
18 Profitability Net Income & EPS Return on Average Assets Return on Tangible Common Equity All dollars shown in millions $22.9 $22.6 $19.8 $19.8 $18.7 $0.37 $0.36 $0.32 $0.32 $0.30 3Q162Q161Q164Q153Q15 Net Income EPS $8,322 $8,204 $8,119 $7,950 $7,611 1.09% 1.11% 0.98% 0.99% 0.97% 3Q162Q161Q164Q153
Slide 19: Adjusted Net Income
19 Adjusted Net Income Reflects impact to net income from items that do not occur on a regular basis Earnings Diluted EPS Earnings Diluted EPS GAAP net income 22,850$ 0.37$ 22,568$ 0.36$ Less: noninterest income adjustments 1,2 (398) (2,164) Plus: noninterest expense adjustments 3.4 411 162 Subtotal
Slide 20: Loan Portfolio
20 Loan Portfolio Loan Product Mix (EOP) Net Loan Change (Linked Quarter) * Includes residential mortgage, home equity, installment, & credit card. All dollars shown in millions Highlights 32% 33% 34% 33% 33% 14% 14% 14% 15% 15% 29% 28% 27% 27% 27% 7% 7% 6% 6% 5% 18% 19% 19% 20% 20% $5,790 $5,701 $5
Slide 21: Loan Portfolio by Geography and Lending Platforms
21 Loan Portfolio Loan Portfolio By Geography 1 Average Loan Size & Rate 2 Nationwide Lending Platforms 1 Includes loans held for sale. Excludes purchase accounting loan marks. 2 Average loan balances in $000s. 3 Includes Oak Street, Franchise, shared national credits & other loans outside Ohio, Ind
Slide 22: C&I Loans by Industry, CRE Loans by Collateral
22 Loan Portfolio C&I Loans By Industry 1 CRE Loans By Collateral 2 1 Industry types included in Other representing greater than 1% of total C&I loans include Agriculture, Retail Trade, Public Administration, Waste Management, Other Services, Educational Services, Transportation & Warehousing, and A
Slide 23: Investment Portfolio
23 Investment Portfolio Total EOP investments of $1.80 billion Investment Portfolio / Total Assets = 21.5% Effective yield earned during third quarter = 2.50% Portfolio duration = 2.6 years Portfolio Composition Portfolio Quality Agency CMOs 24% Commercial MBS 24% Asset-backed securities 16% Agency
Slide 24: Asset Quality
24 Asset Quality Non-Performing Assets / Total Assets Classified Assets / Total Assets Allowance / Total Loans Net Charge Offs & Provision Expense All dollars shown in millions $58.0 $59.6 $64.1 $70.1 $71.1 0.69% 0.72% 0.78% 0.86% 0.90% 3Q162Q161Q164Q153Q15 NPAs NPAs / Total Assets $57.6 $56.7 $53.7
Slide 25: Net Interest Income / Net Interest Margin
25 Net Interest Income / Net Interest Margin Gross loans include loans held for sale & FDIC indemnification asset All dollars shown in millions Average Deposits Net Interest Income Average Securities Average Loans $68.8 $67.1 $66.6 $66.1 $63.2 3.66% 3.67% 3.68% 3.69% 3.67% 3Q162Q161Q164Q153Q15 Net I
Slide 26: Interest Rate Sensitivity
26 Interest Rate Sensitivity Loan Portfolio – Floating Loan Growth (1) Sensitivity Trend (Up100, Up200) (3) 32% Y-o-Y growth in floating rate lending (1) 43% Y-o-Y growth in client derivatives (2) % of loans repricing: <=3 months 57% <1 year 58% Securities portfolio duration – 2.6 years Non-maturity
Slide 27: Non-Interest Income
27 Non-Interest Income Non-Interest Income 3Q16 Highlights * Includes net gain on sale of investment securities & other noninterest income. All dollars shown in millions Total other non-interest income decreased $3.2 million, or 16.1%, on lower loss share related & other income Service charges on de
Slide 28: Non-Interest Expense
28 Non-Interest Expense Noninterest Expense 3Q16 Highlights Efficiency Ratio All dollars shown in millions Total non-interest expense increased $1.7 million, or 3.4% $2.6 million, or 8.7%, increase in salary & benefits expense, which includes $0.8 million of severance costs & YTD performance based c
Slide 29: Capital
29 Capital Tier 1 Common Equity Tangible Book Value Total Capital Tangible Common Equity All capital numbers are considered preliminary All dollars shown in millions $650.2 $635.5 $615.1 $597.5 $601.3 $10.50 $10.26 $9.94 $9.69 $9.74 3Q162Q161Q164Q153Q15 Tangible Book Value Tangible Book Value per Sh
Slide 30: Appendix: Non-GAAP to GAAP Reconciliation
30 Appendix: Non-GAAP to GAAP Reconciliation Net interest income and net interest margin - fully tax equivalent Sep. 30, June 30, Mar. 31, Dec. 31, Sep. 30, Sep. 30, Sep. 30, 2016 2016 2016 2015 2015 2016 2015 Net interest income $68,818 $67,132 $66,555 $66,083 $63,159 $202,505 $180,419 Tax equivale
Slide 31: Appendix: Non-GAAP to GAAP Reconciliation
31 Appendix: Non-GAAP to GAAP Reconciliation Additional non-GAAP ratios Sep. 30, June 30, Mar. 31, Dec. 31, Sep. 30, Sep. 30, Sep. 30, (Dollars in thousands, except per share data) 2016 2016 2016 2015 2015 2016 2015 Net income (a) $22,850 $22,568 $19,814 $19,820 $18,673 $65,232 $55,243 Average total
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