First Financial Bancorp. · NASDAQ:FFBC
First Financial Bancorp — Investor Presentation (June 2009)
49 slides from First Financial Bancorp's investor presentation, Jun 25, 2009
Slide 1: First Financial Bancorp Investor Presentation First Quarter 2009
Exhibit 99.1 First Financial Bancorp Investor Presentation First Quarter 2009
Slide 2: Forward-Looking Statement Disclosure
Forward-Looking Statement Disclosure Certain statements that are not statements of historical fact constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act (the Act). In addition, certain statements in future filings by First Financial with the Securit
Slide 3: Investment Highlights
Investment Highlights Corporate Overview (March 31, 2009) Total Assets: $3.8 billion Profitably managing the company throughout the economic downturn Total Loans: $2.7 billion Total Deposits: $2.9 billion First Quarter 2009 82 retail branch locations serving 9 regional Strong loan and deposit growth
Slide 4: History
History First Financial Bank was founded in 1863 16 bank/thrift acquisitions from 1989 through 1999 resulted in multiple bank charters and brand identities Established Strategic (Rebuilding & Reorganization) Plan in March 2005 Consolidated and streamlined company to establish one charter and one bra
Slide 5: Reorganization Plan - Timeline
Reorganization Plan - Timeline January March 2005 2009 5
Slide 6: Business Units
Business Units Retail Banking Commercial Banking Wealth Management 6
Slide 7: Corporate Goals
Corporate Goals Top-quartile performance for all stakeholders Sustained and consistent excellence Commitment to growth Effective management of all risks 7
Slide 8: Growth Plan
Growth Plan Primary focus and value creation is through organic growth in key regional markets 2008 expansion included the addition of a commercial lending team in Indianapolis (IN), a new business office and banking center in Kettering (OH), and a new banking center in Crown Point (IN) 2009 plans i
Slide 9: Business Strategy
Business Strategy Markets Client “Intimate” Strategy Northwest Indiana Strategic Focus: build long-term relationships with North Central Indiana clients by identifying and meeting their financial Indianapolis - Indiana needs South Central Indiana Target clients Northern Ohio Dayton / Middletown - Oh
Slide 10: Growth-Market Expansion
Growth-Market Expansion Considerably enhances First Financial’s presence in the attractive Cincinnati MSA First Financial Banking Centers Banking Centers to be Acquired Source: SNL Financial 10
Slide 11: Branch Acquisition Highlights
Branch Acquisition Highlights Addition of 17 banking centers in Cincinnati MSA announced May 18, 2009 Consistent with First Financial's stated and conservative strategy 1 First Financial will have the 4th largest branch network in the Cincinnati MSA Pro forma 2.88% Cincinnati MSA deposit market shar
Slide 12: Attractive Deposit Composition & Low-Risk Loan Portfolio
Attractive Deposit Composition & Low-Risk Loan Portfolio $12.8M, $34.4M, $5.8M, 4.1% $28.9M, 11.1% 2.2% 11.0% $49.4M, 1 18.9% $43.1M, 46.2% $119.4M, 38.6% $177.3M, 1 67.8% “Other” includes church, farm, commercial and personal vehicle loans, and loans secured by deposit accounts Strong core deposit
Slide 13: Investment Highlights
Investment Highlights Summary: This transaction leverages current market conditions and First Financial’s capital and competitive strength to accelerate the company’s key-market growth strategy Very attractive transaction First Financial expands its banking center network in the Cincinnati MSA by 50
Slide 14: Demographic Profile
Demographic Profile Demographic Profile (First Financial Bancorp) Deposit, Market Share and Popluation Data as of June 30, 2008 Projected Number Total Deposits FFBC Deposits FFBC Deposit Population of FFBC State Market in Market in Market Market Share Change Banking ($000) ($000) (%) 2008 - 2013 Cen
Slide 15: Retail Banking
Retail Banking Strategic Focus Retail consumer clients Deposits Select consumer lending activities 82 retail banking center locations Serving 9 regional markets in 53 communities in 3 states Managed locally by experienced local bankers Supported centrally 15
Slide 16: Commercial Banking
Commercial Banking Strategic Focus Small / mid-size private businesses located within our regional markets Commercial & Industrial Commercial Real Estate Deposits / Cash Management Sales Force 9 Market Presidents 48 Commercial Lenders 10 Treasury Management Representatives 16
Slide 17: Wealth Management
Wealth Management First Financial Wealth Resource Group Trust Brokerage Investment Advisor Strategic Focus Maintain existing client base Increase share of wallet of existing client base Integration with retail and commercial banking clients 17
Slide 18: Credit Management System
Credit Management System Market-Based Centralized First Financial Bancorp / Bank CEO Market Level Chief Credit Executive Vice Officer President Markets Central Regional Credit Market Officers Documentation/ Presidents Filing Commercial Real Special Assets Commercial Estate Specialist Collections Len
Slide 19: Credit Quality
Credit Quality March 31, 2009 Credit quality trends remained relatively stable and within expected range throughout most of 2008 Reflects discipline of originating loans within existing footprint, strong underwriting policies, and proactive management of resolution strategies for problem credits Ong
Slide 20: Credit Quality: Net Charge-offs to Average Loans & Leases
Credit Quality Net Charge-offs to Average Loans & Leases Peer Group I (size) Peer Group II (geography) FFBC 0.89% 0.85% 0.73% 0.74% 0.65% 0.60% 0.55% 0.46% 0.47% 0.38% 0.40% 0.40% 0.36% 0.37% 0.36% 0.33% 0.28% 0.28% 0.24% 0.26% 0.22% 0.22% 0.23% 0.23% 0.19% 0.15% 0.10% 1Q-07 2Q-07 3Q-07 4Q-07 1Q-08
Slide 21: Credit Quality: Allowance to Nonperforming Loans
Credit Quality Allowance for Loan & Lease Losses to Nonperforming Loans Peer Group I (size) Peer Group II (geography) FFBC 260% 241% 222% 216% 209% 212% 198% 195% 197% 187% 193% 162% 151% 155% 152% 141% 146% 136% 100% 101% 90% 90% 80% 79% 76% 72% 77% 1Q-07 2Q-07 3Q-07 4Q-07 1Q-08 2Q-08 3Q-08 4Q-08 1
Slide 22: Credit Quality: Nonperforming Loans to Total Loans
Credit Quality Nonperforming Loans to Total Loans Peer Group I (size) Peer Group II (geography) FFBC 2.81% 2.31% 2.21% 2.04% 1.62% 1.46% 1.46% 1.19% 1.12% 0.91% 0.91% 0.83% 0.81% 0.76% 0.70% 0.65% 0.68% 0.59% 0.56% 0.58% 0.57% 0.53% 0.49% 0.55% 0.53% 0.43% 0.45% 1Q-07 2Q-07 3Q-07 4Q-07 1Q-08 2Q-08 3
Slide 23: Capital
Capital Regulatory Ratio 1Q-09 Target "well-capitalized" Excess consolidated capital of minimum $159.1 million over regulatory EOP Tangible Equity / 8.60% 6.75% - 7.25% n/a minimum required level EOP Tangible Assets EOP Tangible Common Equity / Based on “well-capitalized” EOP Tangible Common Assets
Slide 24: Capital Raise
Capital Raise Common Share Offering Completed a public offering of 13.8 million shares at $7.50 per share Net proceeds of approximately $98.0 million after deducting underwriting discounts, commissions and estimated offering expenses Proceeds will be used for general corporate purposes, which may in
Slide 25: Strong Capital Ratios
Strong Capital Ratios Regulatory Actual Ratio Adjusted * "well-capitalized" (March 31, 2009) minimum Tier 1 Leverage 9.51% 11.77% 5.00% Tier 1 Risk-Based Capital 12.16% 14.96% 6.00% Total Risk-Based Capital 13.39% 16.19% 10.00% Tangible Equity to Tangible Assets (period-end) 8.60% 10.62% n/a Tangibl
Slide 26: Participation in the U.S. Treasury Capital Purchase Program
Participation in the U.S. Treasury Capital Purchase Program Issued and sold to Treasury 80,000 shares of Series A Senior Preferred Stock* for an aggregate purchase price of $80 million Liquidation preference of $1,000 per share Warrant to purchase up to 930,233 common shares, without par value at an
Slide 27: CPP Investment Portfolio
CPP Investment Portfolio March 31, 2009 Established CPP Investment Portfolio with proceeds received from Treasury Totaled approximately $225.4 million compared with $122.5 million at December 31, 2008 Short and long-term plans for the utilization of CPP proceeds Selectively added to the CPP Investme
Slide 28: Financial Information
Financial Information
Slide 29: Earnings Per Share
Earnings Per Share $0.29 $0.24 $0.22 $0.22 $0.21 $0.21 $0.21 $0.21 $0.21 $0.21 $0.20 $0.20 $0.19 $0.17 $0.15 $0.14 $0.13 $0.06 1Q-07 2Q-07 3Q-07 4Q-07 1Q-08 2Q-08 3Q-08 4Q-08 1Q-09 GAAP Earnings Per Share Earnings Per Share* * Reflects the impact of certain non-recurring items. A reconciliation pres
Slide 30: Pre-Tax Pre-Provision Income
Pre-Tax Pre-Provision Income Demonstrates a more representative comparison of operational performance without the volatility of credit quality that is typically present in times of economic stress Excludes provision expense and applicable securities gains and losses ($ in thousands) Quarter 1Q-09 4Q
Slide 31: Net Interest Margin
Net Interest Margin 7.00% 6.00% 5.00% 4.12% 4.00% 3.97% 3.88% 3.79% 3.78% 3.72% 3.68% 3.67% 3.61% 3.00% 2.00% 1.00% 0.00% 1Q-07 2Q-07 3Q-07 4Q-07 1Q-08 2Q-08 3Q-08 4Q-08 1Q-09 Earning Asset Yield Liability Cost Net Interest Margin Fed Funds Target Rate* * Represents the Fed Funds Target Rate at the
Slide 32: Loan Composition
Loan Composition March 31, 2009 6% 51% 4% 4% 39% 13% 11% 44% Owner Occupied - $458.1 million Single Issuer Loan Participation - $50.5 million Acquisition & Land Development - $72.9 million Non-Owner Occupied - $601.8 million 28% 4% Commercial Real Estate Commercial & Industrial HELOC Residential Rea
Slide 33: Earning Assets & Loan Composition
Earning Assets & Loan Composition Average End of Period Earning Assets Loan Portfolio Composition Yield 6.6% 6.9% 5.9% 5.0% 14% 14% 10% 11% 11% 12% 22% 8.0% 9% 8.2% 5.7% 4.0% 7.9%6% 7.8%5% 7.6%4% 15% 13% 6.5% 9% 17% 5.6%14% 13% 5.6% 11% 26% 5.6%21% 20% 16% 5.5% 24% 12% 40% 41% 57% 33% 53% 55% 29% 5.
Slide 34: Loan Strategy
Loan Strategy Average Total Loans First quarter 2009 average total loans increased ($ in millions) $23.0 million or 3.4% from fourth quarter 2008 $2,708 $2,712 $2,689 Driven primarily by 14.1% growth in commercial $2,645 lending portfolios $2,593 Overall declines in the average consumer lending 1Q-0
Slide 35: Loan Portfolio Strategy
Loan Portfolio Strategy Growth Since 2005* Indirect Installments (88%) Residential Mortgages (53%) Commercial Lending 49% (450,000) (350,000) (250,000) (150,000) (50,000) 50,000 150,000 250,000 350,000 450,000 550,000 650,000 ($000s) Gross loan CAGR* = 0.65% due to planned runoff in indirect loans a
Slide 36: Investment Portfolio
Investment Portfolio March 31, 2009 On-going review of various strategies to increase the size of the investment portfolio and its absolute level of earnings, while balancing capital and liquidity targets Since the end of the first quarter of 2008, the portfolio has grown approximately $380.7 millio
Slide 37: Investment Portfolio
Investment Portfolio March 31, 2009 Sector Allocation Credit Quality MBSs (Agency) 63.8% Investment Grade 96.7% Agency Preferred CMOs (Private) Not Rated 0.0% 0.0% 2.1% CMOs (Agency) Other * Municipal Non-Investment Agencys 22.3% 4.1% 4.4% Grade Other Investment 5.4% 0.2% Grade 1.0% * Other includes
Slide 38: Liability Mix & Deposit Composition
Liability Mix & Deposit Composition Average End of Period Liability Mix Deposit Portfolio Composition Yield 3.0% 3.4% 2.5% 1.6% 6% 42% 42% 41% 39% 7% 10% 13% 40% 41% 38% 3.9% 4.5% 4.0% 3.2% 35% 46% 43% 42% 44% 40% 40% 39% 39% 1.8% 2.0% 0.8% 0.2% 16% 13% 13% 13% 0.0%15% 0.0% 15% 0.0% 0.0% 15% 13% Ave
Slide 39: Deposit Strategy
Deposit Strategy Average Total Deposits First quarter 2009 average total deposits increased ($ in millions) $2,832 $42.1 million or 6.1% from fourth quarter 2008 $2,822 Driven primarily by 13% growth in transaction and $2,795 $2,783 savings deposits, including solid increases in $2,780 commercial tr
Slide 40: Noninterest Income
Noninterest Income First Quarter 2009 Total Noninterest Income = $12.0 million Service Charges on Deposits Trust & Investment Advisory Fees ($ in millions) ($ in millions) $6.0 $6.0 $5.0 $5.0 $4.0 $4.0 $3.0 $3.0 $2.0 $2.0 $1.0 $1.0 $0.0 $0.0 1Q-07 2Q-07 3Q-07 4Q-07 1Q-08 2Q-08 3Q-08 4Q-08 1Q-09 1Q-0
Slide 41: Efficiency
Efficiency Efficiency Ratio Long-Term Target = 55% to 60% 41
Slide 42: Staffing Level
Staffing Level Full-Time Equivalent Personnel 42
Slide 43: Summary of Items Impacting Earnings Per Share
Summary of Items Impacting Earnings Per Share ($ in thousands, excluding per share data) 2009 2008 2007 1Q Full-Year 4Q 3Q 2Q 1Q Full-Year 4Q 3Q 2Q 1Q Gain (Loss) on FHLMC shares* $ 11 $ (3,738) $ (137) $ (3,400) $ (221) $ 20 $ - $ - $ - $ - $ - Increase in Loan Loss Reserve & Higher Charge-offs - (
Slide 44: Leadership
Leadership
Slide 45: Leadership
Leadership Claude E. Davis President & Chief Executive Officer Claude E. Davis joined First Financial in 2004 as President, Chief Executive Officer, and a member of the Board of Directors. Mr. Davis also serves as Chairman of the Board of Directors of First Financial Bank. Prior to joining the compa
Slide 46: Leadership
Leadership Richard Barbercheck Senior Vice President & Chief Credit Officer Richard Barbercheck joined First Financial in 2005 as Senior Vice President and Chief Risk Officer, and was appointed to his current position in 2006. Mr. Barbercheck is responsible for the administration of the bank’s lendi
Slide 47: Leadership
Leadership John Sabath Senior Vice President & Chief Risk Officer John Sabath joined First Financial in 2005 as Regulatory Risk Manager. Mr. Sabbath was then promoted to Senior Risk Officer and First Vice President, and assumed his current position in 2008. He is responsible for management of the co
Slide 48: About First Financial Bancorp
About First Financial Bancorp First Financial Bancorp is a Cincinnati, Ohio based bank holding company with $3.8 billion in assets. Its banking subsidiary, First Financial Bank, N.A., founded in 1863, provides retail and commercial banking products and services, and investment and insurance products
Slide 49: Another step on the path to success
Another step on the path to success
First Financial Bancorp — Investor Presentation (June 2009) on 6ix