Wesbanco, Inc. · NASDAQ:WSBC

Wesbanco — Keefe, Bruyette & Woods 2013 Community Bank Conference

36 slides from Wesbanco's conference presentation, Jul 29, 2013

  1. Slide 1: Keefe, Bruyette & Woods 2013 Community Bank Conference

    Keefe, Bruyette & Woods 2013 Community Bank Conference New York, NY July 30 - 31, 2013

  2. Slide 2: Forward-looking statements

    Forward-looking statements in this report relating to WesBanco’s plans, strategies, objectives, expectations, intentions and adequacy of resources, are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The information contained in this report should

  3. Slide 3: WesBanco company overview

     Headquarters in Wheeling, West Virginia  Assets: $6.1 billion  Founded in 1870  33 banks/24 companies acquired in 25 years  Banking operations in West Virginia, Ohio and Western Pennsylvania  118 banking offices + Pittsburgh Business Loan Office  104 ATM’s  Wealth management, securities bro

  4. Slide 4: Executive management

    Years in Years with Executive Position Banking WSBC James Gardill Chairman of the Board 40* 40 Paul Limbert President & CEO 35 35 Robert Young EVP & CFO 26 11 Peter Jaworski EVP & Chief Credit Officer 28 17 Jonathan Dargusch EVP – Trust & Investments 31 2 Bernard Twigg EVP – Chief Lending Officer 28

  5. Slide 5: Recent highlights: dividends, deposits, Fidelity acquisition

     Increased dividends to shareholders 5 times in last 10 quarters representing a 36.0% increase.  Continued growth in deposits and loans.  Strong loan origination focus.  Deposits have been impacted by Marcellus and Utica shale payments.  Acquired Fidelity Bancorp.  Opens new markets in Pittsbu

  6. Slide 6: Earnings, credit quality and expense highlights

     Continued growth in earnings and improved credit quality.  Formed a private banking team to coordinate delivery of special service products.  Continued control of expenses.  Continued restructuring of branch offices.  Closed 6 branches.  Will open 3 new branches in 2013.  Maintained strong c

  7. Slide 7: An Expanding Franchise in Contiguous Markets

    An Expanding Franchise in Contiguous Markets: 118 banking offices Pennsylvania Ohio Pittsburgh Columbus Wheeling Parkersburg Morgantown Cincinnati Jackson Charleston West Virginia

  8. Slide 8: Marcellus Shale regional coverage and deposit market share

    Deposit Market Share Marcellus Shale Regional Coverage WesBanco Marcellus Shale Counties of Operation (1) Number Deposits in Market of Market Share Rank Institution (ST) Branches ($mm) (%) 1 PNC Financial Services Group Inc. (PA) 151 $40,225 38.6% 2 Bank of New York Mellon Corp. (NY) 4 18,800 18.0 3

  9. Slide 9: Western Pennsylvania growth with Fidelity

     With Fidelity we have 15 offices and a loan production office in Western PA.  Build upon community bank reputation of Fidelity.  Operate as a separate market with a market president.  Expect to grow to $1 billion in loans in next few years.  Add revenue generating staff – reducing back office.

  10. Slide 10: Targeted M&A opportunities

     History of successful consolidations.  WesBanco is focused on targeted M & A opportunities in its higher growth metro markets within our market areas.  Management, technology/ back office and capital/ liquidity strength to compete for deals of interest.  Current stock valuation provides for ups

  11. Slide 11: Trust and securities: assets under management

     $3.4B of assets under management/custody.  Over 5,000 trust relationships.  Combined Trust and Securities under one Assets Under Management ($B) management team. Management Fees ($MM)  10 locations in WV, OH & PA. Net Securities Brokerage Revenue ($MM)  Improving performance as asset values ha

  12. Slide 12: Net income, diluted EPS and provision for credit losses

    Six Months Six Months ($ in thousands, except diluted earnings per share)00’s Ended June Ended June except per share data) 2013 2012 % Change Net Income $33,037 $23,988 37.7% Diluted Earnings Per Share $ 1.13 $ 0.90 25.6% Provision for Credit Losses $3,123 $12,105 (74.2%) Return on Average Assets 1.

  13. Slide 13: Net interest margin

    NIM Yield on Earning Assets Cost of Funds 4.54% 4.43% 4.37% 4.27% 4.31% 4.20% 3.57% 3.64% 3.56% 3.53% 3.51% 3.50% 1.14% 1.07% 1.03% 0.93% 0.81% 0.77% 1Q'12 2Q'12 3Q'12 4Q'12 1Q'13 2Q'13 13

  14. Slide 14: Total risk based capital and tangible equity

    Total Risk Based Capital Tangible Equity to Tangible Assets * 16.00% 14.45% 14.36% 14.07% 14.13% 14.08% 14.00% 12.00% 10.00% 8.00% 7.00% 7.13% 6.97% 6.77% 7.01% 6.00% 4.00% 2.00% 0.00% 2Q'12 3Q'12 4Q'12 1Q'13 2Q'13 *See non-GAAP measures for additional information relating to the calculation of this

  15. Slide 15: Loan, deposit and capital growth

    $ 850 750 650 550 450 350 250 150 50 (50) 2Q'11 3Q'11 4Q'11 1Q'12 2Q'12 3Q'12 4Q'12 1Q'13 2Q'13 Loan Growth Deposit Growth Capital Growth 15 11/30/12 acquisition of Fidelity Bancorp.

  16. Slide 16: Securities portfolio

    Securities = $1.58 B  Average tax-equivalent ~26.0% of total assets portfolio yield of 3.20% at US Govt. 6/30/13. Agencies  WAL approx. 5.5 years; 4.5% modified duration 4.6%.  Over 55% unpledged. Municipals,  Sold approx. 60% or $130 Agency 39.2% million of Fidelity Mortgage- portfolio includin

  17. Slide 17: Total portfolio loans

    6/30/13 Total Portfolio Loans = $3.8 B Comm. Real Estate = Comm. & $1.88 B Ind., 14.2% LHFS, 0.4% Const & Dev. Consumer, 10.4% 7.0% Comm. Investor- HELOC, Real owned 7.3% Estate, 61.5% 49.3% Res. Real Owner- Estate, occupied 21.8% 28.1% 17

  18. Slide 18: Loan categories by quarter

    $300,000 $250,000 $200,000 (in thousands) $150,000 $100,000 $50,000 $0 1Q'12 2Q'12 3Q'12 4Q'12 1Q'13 2Q'13 Consumer Credit Lines Commercial Real Estate 18

  19. Slide 19: Non-interest income

    Other Inc. Insurance  Non-interest income contributed Securities brokerage Trust 28% of net revenue for the 1st and Service charges & Fees 2nd quarters 2013. ($MM)  Non-bank offerings (trust, $69.5 $60.4 $60.2 $62.6 insurance, securities) contributed $59.3 $14.4 million to YTD 2013 revenue.  Secu

  20. Slide 20: Peer Group – Price / 2013 Estimated Earnings

    Peer Group – Price / 2013 Estimated Earnings Price / 2013 Estimated Earnings (x) (1) Median (Excl. WSBC): 14.5x 18.0x 17.2x 16.0x 16.0x 15.8x 15.5x 15.4x 15.3x 15.2x 14.9x 14.6x 14.4x 14.3x 14.2x 13.9x 14.0x 13.7x 13.6x 13.6x 13.2x 12.6x 12.0x 10.0x 8.0x 6.0x FCF NPBC UBSI National FNB FFBC PRK ONB

  21. Slide 21: Current Market Update

    Current Market Update Market Performance – Cycle-to-Date 125.00% 100.00% 75.00% 50.00% 25.00% 0.00% 6/30/07 1/1/09 7/7/10 1/10/12 7/15/13 S&P 500 Index (11.92%) WSBC (-2.51%) KBW Regional Banking Index (-25.48%) KBW Bank Index (-42.55%) 21 Source: FactSheet Research System

  22. Slide 22: Interest Rate Sensitivity

    Interest Rate Sensitivity % Change in Net Interest Income from Base Over One Immediate Change in Interest Rates Year June 30, 2013 Up 1% Rate Shock +1.3% Up 2% Rate Shock +1.1% Up 3% Rate Shock -0.4% Up 2% Rate Ramp +1.5% Down 1% Rate Shock -1.9% EVE Up 2% Rate Ramp -1.3% EVE Down 1% Rate Ramp -6.3%

  23. Slide 23: Investment highlights

     Strong regulatory capital.  Proven acquisition-oriented growth strategy.  Liquidity to provide for additional lending capacity.  Asset quality compares favorably with regional and national peers.  Diversity of earnings stream.  Potential upside market appreciation. 23

  24. Slide 24: Appendix

    24 Appendix By all accounts, better.

  25. Slide 25: Non-performing and criticized loans

    10.0% 9.0% 8.0% 7.0% 6.0% 5.0% 4.0% 3.0% 2.0% 1.0% 0.0% 2Q'11 3Q'11 4Q'11 1Q'12 2Q'12 3Q'12 4Q'12 1Q'13 2Q'13 NPA's as a % of total Loans Criticized & Classified Loans as a % of total Loans 25

  26. Slide 26: Provision, allowance and non-performing loans

    3.50% $12,000 3.00% $10,000 2.50% $8,000 2.00% $6,000 1.50% $4,000 1.00% $2,000 0.50% 0.00% $- 2Q'11 3Q'11 4Q'11 1Q'12 2Q'12 3Q'12 4Q'12 1Q'13 2Q'13 ($000) Provision for credit losses ALL as a % of total loans Non performing loans as a % of total loans 26

  27. Slide 27: Loans by market

    $1,000 $900 $800 $700 $600 ($ in millions) $500 $400 $300 $200 $100 $- 12/31/2011 12/31/2012 6/30/2013 Upper Ohio Valley North Central WV Parkersburg Kanawha Valley Western PA Central Ohio SW Ohio SE Ohio 27

  28. Slide 28: Total bank loans by region

    ) June 30, 2013 Commercial Retail Total % of Total Loans Upper Ohio Valley $ 514 $ 427 $ 941 25% North Central WV 264 211 475 12% Parkersburg 175 83 258 7% Kanawha Valley 81 59 140 4% Western PA 353 162 515 13% Total East Markets $ 1,387 $ 942 $ 2,329 61% Central Ohio 566 132 698 18% Southwest Ohio

  29. Slide 29: Non-performing assets by region

    June 30, 2013 90 Day PD Non- TDR Other RE Total by % of Total & Accruing Accrual Owned Region Upper Ohio Valley $ 644 $ 3,882 $ 4,208 $ 83 $8,817 12% North Central WV 487 1,318 2,971 ---- 4,776 7% Parkersburg 134 1,549 1,710 47 3,440 5% Kanawha Valley 60 2,193 381 ---- 2,634 4% Western PA 306 6,681

  30. Slide 30: Efficiency ratio reconciliation, six months

    ($ in thousands) 6/30/13 6/30/12 Non-interest expense $ 80,246 $ 71,749 Less: restructuring and merger related expense 1,229 --- Non-interest expense excluding restructuring and merger related expense $ 79,017 $71,749 Net Interest income (on a fully taxable equivalent basis) $ 95,560 $ 86,687 Non-in

  31. Slide 31: Efficiency ratio reconciliation, quarter

    3 months 3 months ($ in thousands) ended ended 6/30/13 6/30/12 Non-interest expense $ 39,499 $ 36,084 Less: restructuring and merger related expense 51 --- Non-interest expense excluding restructuring and merger related $ 39,448 $ 36,084 expense Net Interest income (on a fully taxable equivalent bas

  32. Slide 32: Tangible equity to tangible assets

    ($ in thousands) 2Q’12 3Q’12 4Q’12 1Q’13 2Q’13 Total shareholder’s equity $ 649,112 $ 659,322 $ 714,184 $ 724,409 $ 726,232 Less: goodwill & other intangible assets (282,088) (281,570) (324,465) (323,003) (322,478) Tangible equity $ 367,024 $ 377,752 $ 389,719 $ 401,406 $ 403,754 Total assets $5,525

  33. Slide 33: Net operating non-interest income

    ($ in thousands) 2009 2010 2011 2012 2013* Non-interest Income $ 64,589 $ 59,599 $ 59,888 $ 64,775 $ 71,024 Less: Net Securities gains 6,046 3,362 963 2,463 1,416 Less: net gains/losses on other real estate owned and other assets (747) (4,128) (1,290) (305) 111 Net operating non-interest income $ 59

  34. Slide 34: Return on average tangible equity, YTD

    ($ in thousands) 6/30/12 YTD 6/30/13 YTD Net income* $ 48,239 $ 66,622 Plus: amortization of intangibles* (tax effected at 35%) 1,387 1,555 Net income before amortization of intangibles* $ 49,626 $ 68,177 Average total shareholders’ equity $ 643,597 $ 727,100 Less: average goodwill & other intangibl

  35. Slide 35: Return on average tangible equity, QTD

    ($ in thousands) 6/30/12 QTD 6/30/13 QTD Net income* $ 48,255 $ 68,256 Plus: amortization of intangibles* (tax effected at 35%) 1,370 1,464 Net income before amortization of intangibles* $ 49,625 $ 69,720 Average total shareholders’ equity $ 648,014 $ 731,935 Less: average goodwill & other intangibl

  36. Slide 36: WesBanco

    36 WesBanco By all accounts, better.

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