Fifth Third Bancorp · NASDAQ:FITB
Fifth Third Bancorp — Credit Suisse Financial Services Conference 2010
17 slides from Fifth Third Bancorp's conference presentation, Feb 10, 2010
Slide 1: Credit Suisse Financial Services Conference
Exhibit 99.1 Credit Suisse Financial Services Conference Daniel T. Poston EVP & Chief Financial Officer February 10, 2010 Please refer to earnings release dated January 21, 2010 for further information, including full results reported on a U.S. GAAP basis Fifth Third Bank | All Rights Reserved
Slide 2: 4Q09 in review
4Q09 in review Continued core business momentum • Net loss of $98M, diluted EPS of ($0.20) – 3Q09 net loss of $97 million included Visa benefit of $206 million after-tax • Net interest margin of 3.55%, up 12 bps sequentially • Average core deposits up 11%, wholesale funding down 44% year-over-year •
Slide 3: Net interest income
Net interest income Core NII and NIM* • Trends in net interest income and net 4.0% $816 $801 $847 $859 $900 interest margin compare favorably with 3.5% $746 3.33% 3.45% $800 peers 3.15% 3.13% $700 3.0% 2.92% $600 – NIM up 12 bps in 4Q09 2.5% $500 • Expect continued expansion in NIM in $400 1Q10 2.0%
Slide 4: Balance sheet: Continued growth in core funding
Balance sheet: Continued growth in core funding Average loan growth ($B) Extended nearly $75B of new and renewed credit in 2009 • CRE loans down 4% sequentially and 17% year-over-year 86 84 82 80 78 – Reduced exposure to homebuilder/developer and other non-owner 33 34 33 33 32 occupied loans; sale o
Slide 5: Fee income and expenses – core trends
Fee income and expenses – core trends* Fee income ($M) • Strong mortgage banking results continued in 4Q09, resulting in $4.4B of originations and $132M in net revenue $700 • Investment advisory revenue up 4% from the previous 8 30 $600 3 45 quarter driven by higher market values 22 $500 • Card and
Slide 6: Pre-tax pre-provision earnings
Pre-tax pre-provision earnings Core PPNR trend Core PPNR reconciliation 4Q08 1Q09 2Q09 3Q09 4Q09 $700 Reported PPNR (GAAP) ($488) $511 $2,393 $844 $562 Adjustments: 100 55 $600 Gain on sale of Visa shares - - - (244) - 46 8 30 BOLI charge 34 54 - - - 45 106 87 Gain from sale of processing interest -
Slide 7: Portfolio performance drivers
Portfolio performance drivers No participation in exotic mortgages Performance largely driven by • Subprime Geography • Option ARMs • Florida and Michigan most stressed • Remaining Midwest and Southeast performance reflect economic trends Discontinued or suspended lending 4Q09 NCO Ratios Coml Cons T
Slide 8: Troubled debt restructurings (TDR) overview
Troubled debt restructurings (TDR) overview Successive improvement in vintage TDR performance has improved in newer vintages performance during 2008 and 2009, even Mortgage TDR 60+ redefault trend by vintage as volume of modification increased 50% Volume by Fifth Third’s mortgage portfolio TDRs vint
Slide 9: Manageable commercial real estate exposure
Manageable commercial real estate exposure CRE / Assets CRE / Loans Peer average: 19% Peer average: 27% 34% 30% 43% 40% 38% 25% 24% 24% 33% 32% 16% 15% 26% 14% 21% 20% 19% 13% 12% 11% 11% 18% 17% 17% 9% 15% MI MTB ZION RF CMA KEY HBAN FITB STI USB BBT WFC PNC MI MTB RF CMA ZION KEY HBAN FITB STI BBT
Slide 10: 4Q09 credit results
4Q09 credit results NPA ratio versus peers Year-over-year NPA growth versus peers 4.5% 3.5% Peer average: 100% 192% 207% 216% 2.5% 97% 105% 108% 1.5% 75% 62% 67% 27% 31% 36% 37% 0.5% HBAN CMA MI STI FITB MTB KEY USB ZION BBT PNC WFC RF 3Q07 4Q07 1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 3Q09 4Q09 FITB Peer Aver
Slide 11: Strong reserve position
Strong reserve position Industry leading reserve level Reserves / Total loans $2,500 1. FITB 4.88% 4.88% 2. KEY 4.31% 4.69% 3. HBAN 4.03% $2,000 729 4.28% 4. ZION 3.81% 3.72% 5. RF 3.43% $1,500 3.31% 6. MI 3.35% 7. PNC 3.22% $1,000 8. WFC 3.13% 1,627 415 196 68 9. STI 2.74% 283 $500 10. USB 2.60% 62
Slide 12: Updated stress testing - process overview
Updated stress testing - process overview Similar process to that used in 2008 and SCAP processes; updated for actual performance and current economic expectations Stress case scenario key economic assumptions (Moody’s Economy.com “Longer Recession and Weaker Recovery Case”) — Unemployment of 12.1%
Slide 13: Updated credit loss expectations vs. SCAP scenarios
Updated credit loss expectations vs. SCAP scenarios $5,500 Fifth Third Fifth Third’s realized credit losses capitalized for this have been significantly below its $5,000 level of losses under SCAP submitted baseline and SCAP (plus surplus more adverse scenarios $5.0B raised vs. buffer) – In SCAP sub
Slide 14: Strong capital position
Strong capital position Tier 1 common ratio Tangible common equity ratio Peer average: 6.2% Peer average: 7.0% 8.5% 8.1% 8.0% 7.6% 8.2% 7.7% 7.5% 7.5% 6.6% 6.5% 7.2% 7.0% 6.1% 6.0% 6.0% 5.7% 6.8% 6.7% 5.4% 5.1% 5.1% 6.5% 6.5% 4.3% 6.0% 5.5% BBT CMA STI MI KEY RF FITB USB HBAN ZION WFC PNC MTB MI CMA
Slide 15: 2010 developments
2010 developments Macro themes Fifth Third response • Sluggish loan demand • Leverage existing customer relationships at the local level to offer our full portfolio of products and services across all of our lines of business • Deposits continue to grow but expect some diminution as liquidity • Inve
Slide 16: Summary
Summary Aggressive management of Core franchise remains strong Robust capital levels credit issues • Dedicated to serving the needs • Strong reserve coverage of • Successfully completed June of families and businesses for problem loans 2008 capital plan and SCAP more than 150 years capital actions •
Slide 17: Cautionary statement
Cautionary statement This report may contain statements that we believe are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Rule 175 promulgated thereunder, and Section 21E of the Securities Exchange Act of 1934, as amended, and Rule 3b-6
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