City Holding Company · NASDAQ:CHCO
City — Merger or Acquisition (August 2012)
16 slides from City's merger presentation, Aug 3, 2012
Slide 1: Partnership with Community Financial Corporation
Partnership with Community Financial Corporation August 2, 2012
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation contains certain forward-looking statements that are included pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such information involves risks and uncertainties that could result in the Company's actual resul
Slide 3: Additional Information
Additional Information In connection with the proposed Merger City will file a registration statement on Form S-4 concerning the transaction with the Securities and Exchange Commission and appropriate state and federal banking authorities as soon as is practical. Community will prepare a proxy state
Slide 4: Overview of Transaction Terms
Overview of Transaction Terms * Based on CHCO’s closing price of $32.66 as of 8/1/12 Based on CFFC’s reported tangible book value per share of $8.66 as of 3/31/12
Slide 5: Transaction Rationale
Transaction Rationale Adjacent market acquisition of a Staunton, Virginia based community bank Established client base through acquisition of an 84 year old franchise Natural extension of branch network along the I-81 corridor and provides entry into the Virginia Beach – Norfolk – Newport News, VA-N
Slide 6: Overview of Community Financial
Overview of Community Financial Founded in 1928 Situated along the 1-81 Corridor in the Shenandoah Valley and in Virginia Beach Thrift Charter subject to regulation by the OCC Community Financial Highlights 9 branches in Shenandoah Valley Region 2 branches in Hampton Roads Region Staunton Richmond V
Slide 7: Logical Expansion into Strong Markets
Logical Expansion into Strong Markets Attractive Virginia markets Community Financial’s markets represent high-growth regions to bolster City’s core markets Improvement in demographic position Enhances market presence in Virginia CHCO – 73 branches CFFC – 11 branches Source: SNL Financial, Bureau of
Slide 8: Pro Forma Market Demographics
Pro Forma Market Demographics ’11-’16 Projected Population Growth (%) ’11-’16 Projected Median HHI Growth (%) 2016 Projected Median HHI ($) Source: SNL Financial Deposit data as of 6/30/11 Population and medium household income are deposit weighted by county Projected Population Growth CHCO CFFC *
Slide 9: Market Position
Market Position Note: Grey highlight indicates original market, yellow highlight indicates market expansion as a result of the acquisition of Virginia Savings Bancorp, Inc., and green highlight indicates market expansion as a result of the acquisition of Community Financial Corporation *
Slide 10: Branches and Deposit Market Share
Branches and Deposit Market Share Staunton-Waynesboro, VA MSA Staunton Verona Stuart’s Draft Staunton Source: SNL Financial Deposit data as of 6/30/11 * Virginia Beach-Norfolk-Newport News MSA
Slide 11: Financial Impact
Financial Impact Key Transaction Assumptions Pro Forma Impact Approximately 9% accretive to earnings Tangible book value earnback period of approximately 2 years No preferred dividend payments Leverage Ratio: 8.6% TCE / TA: 8.2% *
Slide 12: Pro Forma Loan Portfolio
Yield on Total Loans: 5.46% Yield on Total Loans: 4.61% (3) Pro Forma Loan Portfolio Source: SNL Financial Data as of or for the three months ended 3/31/12 Pro forma for acquisition of Virginia Savings Bancorp, Inc.; excludes purchase accounting adjustments Excludes purchase accounting adjustments D
Slide 13: Pro Forma Deposit Composition
Cost of Total Deposits: 0.65% (2) Cost of Total Deposits: 0.77% Source: SNL Financial Data as of or for the three months ended 3/31/12 Pro forma for pending acquisition of Virginia Savings Bancorp, Inc.; excludes purchase accounting adjustments Data as of the three months ended 6/30/12 CHCO (1) CFFC
Slide 14: Due Diligence Process
Due Diligence Process Due Diligence Overview Due diligence team of 10 people over 5 days Included 2 individuals from a third party loan review team Reviewed 100% of lending relationships with at least $1.0 million in aggregate loans outstanding Reviewed nearly all nonaccrual, substandard and special
Slide 15: Benefits to CFFC Stakeholders
CHCO provides for a better long-term return free of regulatory burden of smaller community banks Annual CHCO dividend payout of $1.1 million versus no dividend today Enhanced liquidity Expected repayment of TARP stock Shareholders Customers Employees Benefits to CFFC Stakeholders Both banks have str
Slide 16: Summary
Execution of our growth strategy into attractive, neighboring markets Financially attractive to all constituents Meets our internal return thresholds Proven regional banking franchise Summary *