First · NASDAQ:FUNC
First — First United — Shareholder Meeting (May 2014)
61 slides from First's shareholder meeting presentation, May 15, 2014
Slide 1: First United Corporation Annual Shareholders' Meeting May 15, 2014
First United Corporation Annual Shareholders’ Meeting May 10, 2012 First United Corporation Annual Shareholders’ Meeting May 15, 2014
Slide 2: Bill Grant, Chief Executive Officer and Chairman of the Board
First United Corporation Annual Shareholders’ Meeting May 10, 2012 Bill Grant Chief Executive Officer and Chairman of the Board
Slide 3: Forward-Looking Statements
3 Forward - Looking Statements Forward - looking statements in this presentation relating to First United Corporation’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 o
Slide 4: Bill Grant, Chief Executive Officer and Chairman of the Board
First United Corporation Annual Shareholders’ Meeting May 10, 2012 Bill Grant Chief Executive Officer and Chairman of the Board
Slide 5: Carissa Rodeheaver, President and Chief Financial Officer
First United Corporation Annual Shareholders’ Meeting May 10, 2012 Carissa Rodeheaver President and Chief Financial Officer
Slide 6: 2013 Areas of Focus
6 Improve Asset Quality Execute Capital Strategy Strengthen Core Earnings 2013 Areas of Focus
Slide 7: 2013 Areas of Focus: Improve Asset Quality
2013 Areas of Focus » Improve Asset Quality – Reduce Adversely Classified Assets – Convert non - performing assets – Book high quality loans/investments 7
Slide 8: Trends in Adversely Classified Assets
Trends in Adversely Classified Assets 8 0% 20% 40% 60% 80% 100% 120% 140% 160% 180% $0 $50 $100 $150 $200 $250 $300 2008 2009 2010 2011 2012 2013 Adversely Classified Assets (millions) Adv Classified Loans Other Real Estate Owned Adv Classified CDOs Coverage Ratio Recession
Slide 9: Providing for Loan Losses
$0 $5 $10 $15 $20 $25 2007 2008 2009 2010 2011 2012 2013 Q1 14 Millions Provision Net Charge-offs Allowance (Unaudited) 9 Recession Providing for Loan Losses
Slide 10: 2013 Areas of Focus: Strengthen Core Earnings
2013 Areas of Focus » Strengthen Core Earnings – Increase and sustain net interest margin – Focus on non - interest income – Enhance efficiency and reduce operating expenses 10
Slide 11: Net Income Available to / Net (Loss) Attributable to Common Shareholders
-$15 -$10 -$5 $0 $5 $10 $15 2007 2008 2009 2010 2011 2012 2013 Q1 14 $12.8 $8.9 - $12.8 - $11.8 $2.0 $3.0 $4.7 $0.9 Millions (Unaudited) 11 Net Income Available to / Net (Loss) Attributable to Common Shareholders
Slide 12: Net Interest Margin
12 3.51% 3.68% 3.56% 2.71% 2.96% 3.30% 3.25% 3.07% 2.5% 3.0% 3.5% 4.0% 2007 2008 2009 2010 2011 2012 2013 Q1 14 Net Interest Margin (Unaudited)
Slide 13: Trend in Total Assets
13 $300 $500 $700 $900 $1,100 $1,300 $1,500 $1,700 $1,900 2008 2009 2010 2011 2012 2013 Q1 14 $1,639 $1,744 $1,696 $1,391 $1,321 $1,334 $1,355 Millions Trend in Total Assets (Unaudited)
Slide 14: Trend in Loan Balances
Trend in Loan Balances 14 $300 $400 $500 $600 $700 $800 $900 $1,000 $1,100 $1,200 2008 2009 2010 2011 2012 2013 Q1 14 $1,120 $1,102 $988 $919 $859 $797 $801 Millions (Unaudited)
Slide 15: Balance Sheet - Asset Mix
1% 22% 68% 8% Balance Sheet - Asset Mix 15 3% 26% 60% 11% Cash and cash equivalents Investment securities and FHLB stock Loans Other assets 2008 2013
Slide 16: Trend in Deposits
$0 $200 $400 $600 $800 $1,000 $1,200 $1,400 2008 2009 2010 2011 2012 2013 Q1 14 Millions Core Retail CDs Brokered (Unaudited) 16 Trend in Deposits
Slide 17: Other Operating Income
Other Operating Income * 17 $8 $10 $12 $14 $16 $18 2008 2009 2010 2011 2012 2013 $15.8 $15.4 $15.4 $15.0 $13.6 $13.0 Millions * Excluding gains/(losses) Sale of Insurance Assets
Slide 18: Operating Expense
Operating Expense 18 $8 $13 $18 $23 $28 $33 $38 $43 $48 2008 2009 2010 2011 2012 2013 $40.6 $46.6 $45.0 $43.4 $39.5 $42.4 Millions Sale of Insurance Assets
Slide 19: 2013 Areas of Focus: Execute Capital Strategy
2013 Areas of Focus » Execute Capital Strategy – Build Capital Ratios – Resume payment of interest and dividends on Trust Preferred Debt and CPP Preferred Stock – Shift capital composition 19
Slide 20: Corporation Remains Well-Capitalized
0% 2% 4% 6% 8% 10% 12% 14% 16% Q4 10 Q4 11 Q4 12 Q4 13 Q1 14 Tangible Leverage Tier 1 Total Well - Capitalized 20 Corporation Remains Well - Capitalized (Unaudited)
Slide 21: $8.3 Million Cash Dividend: Resumption of Payments on TRUPs and CPP
21 $8.3 Million Cash Dividend Resumption of Payments on TRUPs and CPP $6.5 Million, May 15, 2014 $7.3 Million, March 2014 Bank Corporation U. S. Treasury: Preferred Stock Dividends Third Party Investors: Trust Preferred Interest Expense Cash Payments
Slide 22: Components of Capital
Components of Capital 22 47% 15% (11)% 19% 8% Tier 1: Common Equity, before AOCI Tier 1: Qualifying TRUPs Tier 1: Preferred Stock (CPP) Tier 1 Reductions: Goodwill, Disallowed Deferred Tax Asset Tier 2: Qualifying ALL, Sub Debt, excess TRUPs December 2013
Slide 23: Jeannette Rudy Fitzwater, Senior Vice President & Director of Corporate Services
First United Corporation Annual Shareholders’ Meeting May 10, 2012 Jeannette Rudy Fitzwater Senior V ice President & Director of Corporate Services
Slide 24: Past, Present and Future – Employees
24 Past, Present and Future – Employees Past » Job well done » Promotions » Continual learning » Challenging work » Flexibility Present & Future
Slide 25: Past, Present and Future - Recruitment
Past, Present and Future - Recruitment » Social media usage » Online applications , pre - screening and testing 25
Slide 26: Past, Present and Future – Employee Growth
Past, Present and Future – Employee Growth » Associate development and succession planning » Associates are passionate about learning » Need for associates who may develop at a faster pace 26
Slide 27: Past, Present and Future – Our Customers
Past, Present and Future – Our Customers » M any types of customers » Search for our “best match” customer » Diverse marketing channels » Customized solutions 27
Slide 28: Goal
Goal Whether it is the past, the present or the future, our goal remains the same: » Associates - leverage best talents » Customers - fulfill financial dreams 28
Slide 29: Jason Rush, Senior Vice President, Chief Risk Officer & Director of Operations
First United Corporation Annual Shareholders’ Meeting May 10, 2012 Jason Rush Senior V ice President, Chief Risk Officer & Director of Operations
Slide 30: Residential Housing Market
Residential Housing Market 30
Slide 31: Residential Loan Servicing Portfolio
Residential Loan Servicing Portfolio 31 $0.0 $10.0 $20.0 $30.0 $40.0 $50.0 $60.0 $70.0 2009 2010 2011 2012 2013 $0 $12.2 $21.9 $43.1 $60.8 Millions
Slide 32: Residential Mortgage Production
Residential Mortgage Production 32 32 $0.0 $10.0 $20.0 $30.0 $40.0 $50.0 $60.0 $70.0 $80.0 2009 2010 2011 2012 2013 $60.6 $41.6 $48.3 $69.3 $70.1 Millions # of loans: 353 252 257 360 388
Slide 33: Delivery Channel Usage
33 Delivery Channel Usage ACH 19% Checks 14% ATM 5% Internet / Mobile 4% Point of Sale 39% Teller 19% 2013
Slide 34: Customer Channels
Customer Channels 34
Slide 35: Future of Customer Engagement
Future of Customer Engagement Branch Built for Engagement! 35
Slide 36: Mobile Banking
36 2,563 4,883 6,870 7,262 1,106 2,396 3,830 4,358 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 2011 2012 2013 Q1 14 # of Mobile Devices # of Mobile Customers Mobile Banking
Slide 37: Key Elements of an ERM Program
Key Elements of an ERM Program 37 Governance Structure and Policies Risk Management Risk Assessment and Quantification Dashboard Reporting and Monitoring Enterprise Risk Management How? How? What? Who?
Slide 38: Cyber Threats
Cyber Threats 38
Slide 39: Robin Murray, Senior Vice President & Director of Retail Banking
First United Corporation Annual Shareholders’ Meeting May 10, 2012 Robin Murray Senior V ice President & Director of Retail Banking
Slide 40: Stable Funding Sources
Stable Funding Sources 40 40 10% growth $0 $100 $200 $300 $400 $500 $600 $700 $800 2009 2010 2011 2012 2013 $512 $533 $573 $593 $651 Millions Core Deposits
Slide 41: Impact of Deposit Interest Expense
Impact of Deposit Interest Expense 41 41 10% growth $0 $5 $10 $15 $20 $25 2009 2010 2011 2012 2013 $20.2 $18.1 $11.9 $6.6 $5.1 Millions 24% Compound Annual Decline
Slide 42: Small Business Loan Production
Small Business Loan Production 42 42 10% growth $0.0 $1.0 $2.0 $3.0 $4.0 $5.0 $6.0 $7.0 $8.0 $9.0 2009 2010 2011 2012 2013 $2.8 $3.2 $4.5 $5.7 $8.4 Millions 47% growth
Slide 43: Customer Care Center
Customer Care Center » Extremely efficient – 134,000 customer c alls a nnually » Highly responsive – 27 seconds on - hold t ime » Experienced staff with specialists » Providing exceptional s ervice 43
Slide 44: Future of Customer Engagement
Future of Customer Engagement Branch Built for Engagement! 44
Slide 45: 2014 Initiatives
2014 Initiatives » Enhancing our COBO strategy » Stronger ties in local c ommunities » Enriching trusted a dvisors c ommitment » Expanding revenue o pportunities Effective Execution! 45
Slide 46: Keith Sanders, Senior Vice President & Senior Trust Officer
First United Corporation Annual Shareholders’ Meeting May 10, 2012 Keith Sanders Senior V ice President & Senior Trust Officer
Slide 47: Assets Under Management
47 “WHAT MATTERS MOST” Trust . $0 $100 $200 $300 $400 $500 $600 $700 2009 2010 2011 2012 2013 $544 $590 $595 $637 $675 $176 $190 $189 $215 $234 Millions Trust Assets Investment Assets Assets Under Management
Slide 48: Composition of Trust & Investments Revenue
Trust Management 85% Investment Services 14% Estate Settlements 1% 2013 48 Composition of Trust & Investments Revenue “WHAT MATTERS MOST” Trust .
Slide 49: Trust & Investments Revenue
Trust & Investments Revenue 49 “WHAT MATTERS MOST” Trust . $0.0 $1.0 $2.0 $3.0 $4.0 $5.0 $6.0 2009 2010 2011 2012 2013 $4.3 $4.8 $5.2 $5.4 $5.8 Millions
Slide 50: Trust & Investments: 2014 Initiatives
50 Build Sales Force Financial Planning Capabilities Insurance Services Trust & Investments: 2014 Initiatives “WHAT MATTERS MOST” Trust .
Slide 51: R.L. Fisher, Senior Vice President & Chief Lending Officer
First United Corporation Annual Shareholders’ Meeting May 10, 2012 R.L. Fisher Senior V ice President & Chief Lending Officer
Slide 52: Reestablishing Our Presence in Commercial Lending and Banking
52 Reestablishing Our Presence in Commercial Lending and Banking » Continue focus on improving asset quality » Evaluate processes to invigorate commercial production and growth » Increase calling efforts
Slide 53: Loan Portfolio Composition
33% 13% 8% 43% 3% Commercial Real Estate Acquisition and Development Commercial and Industrial Residential Mortgage Consumer Installment December 2013 Loan Portfolio Composition 53
Slide 54: Commercial Loan Production
$0 $20 $40 $60 $80 $100 $120 $140 $160 2009 2010 2011 2012 2013 Q1 2014 Millions Commercial and Industrial Acquistion and development Commercial real estate 54 Commercial Loan Production
Slide 55: Reestablishing Our Presence in Commercial Lending and Banking
55 Reestablishing Our Presence in Commercial Lending and Banking » Share O ur S tory » Retain and expand » Migrate to full relationship strategy
Slide 56: Bill Grant, Chief Executive Officer and Chairman of the Board
First United Corporation Annual Shareholders’ Meeting May 10, 2012 Bill Grant Chief Executive Officer and Chairman of the Board
Slide 57: Frequently Asked Questions
First United Corporation Annual Shareholders’ Meeting May 10, 2012 Frequently Asked Questions
Slide 58: Status of Participation in Treasury's Capital Purchase Program
Question 1 : What is the current status of the Company's participation in the U.S. Treasury's Capital Purchase Program? 58
Slide 59: Status of Paying a Common Dividend
Question 2 : What is the status of paying a common dividend on the stock? 59
Slide 60: Growth in Earning Assets
Question 3: Can you report on growth in earning assets? 60
Slide 61: Thank you!
First United Corporation Annual Shareholders’ Meeting May 10, 2012 Thank you!