First Financial Bancorp. · NASDAQ:FFBC
First Financial Bancorp — Q1 2019 Earnings Presentation
35 slides from First Financial Bancorp's earnings presentation, May 1, 2019
Slide 1: Investor Presentation First Quarter 2019
Exhibit 99.1 Investor Presentation First Quarter 2019
Slide 2: Forward Looking Statement Disclosure
Forward Looking Statement Disclosure Certain statements contained in this report which are not statements of historical fact constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as ‘‘believes,’’ ‘‘anticipates,’’ “likely,” “expec
Slide 3: Presentation Contents
Presentation Contents About First Financial Bancorp Financial Performance Appendix 3
Slide 4: Company Overview
Company Overview Overview Lines of Business Founded: 1863 Commercial Headquarters: Cincinnati, Ohio C&I, O-CRE, ABL, Equipment Finance, Treasury Retail Banking Banking Centers: 159 Consumer, Business Banking, Small Business Assets: $14.1 billion Mortgage Banking Loans: $8.8 billion Wealth Management
Slide 5: Current Priorities
Current Priorities . Achieve targeted income and balance sheet growth objectives . Develop / begin implementation of strategic technology roadmap . Execute acquisition strategy . Prioritize fee based businesses: wealth, capital markets . In-market bank acquisitions that provide improved market share
Slide 6: Post-merger Success and Growth Strategies
Post–merger Success and Growth Strategies Post-merger Metrics1 Growth Plans • 1.58% return on assets • Continued focus on increasing loan originations and total revenue • 19.85% return on tangible within existing markets common equity • Targeted lending staff additions in • 50.91% efficiency ratio n
Slide 7: Capital Strategy & Deployment
Capital Strategy & Deployment Tangible Book Value Per Share Strategy & Deployment • Announced in 1Q19 share repurchase plan of up to 5 million shares, or $12.19 approximately 5.0% of the Company's $11.75 $11.72 issued and outstanding shares $11.25 $11.01 • No shares repurchased during the first quar
Slide 8: LOB | Go-to-Market Distribution Technology
LOB | Go-to-Market Distribution Technology Product & Pricing * Regional pricing strategy Increased Commercial lending limits « New Consumer product line-up ¢ Treasury Management product investments Talent Expansion « Up-Market Commercial talent acquisition « New business line leadership in Mortgage
Slide 9: Commercial Banking and Wealth Management
first first financial bank COMMERCIAL BANKING Vision ‘Tobe known and operate as the Premier Business Bank and to provide banking ‘solutions to the business, to the owner(s) and to their employees. ‘Target Audience Current Portfolio ‘+ High Demander. ‘Approg 300 Relaonahips +» SIOMM-100MM Sales Reven
Slide 10: Market Centric Strategies
Market Centric Strategies METRO MARKETS COMMUNITY MARKETS HEADQUARTERS NATIONAL Louisville, KY Southeastern IN Columbus, OH South Central IN Greater Cincinnati Industry Specific Indianapolis, IN Northwest IN Northern KY Dayton, OH Northern OH th Low brand awareness High brand awareness 4 in market s
Slide 11: Invest in First Financial
Invest in First Financial . Experienced and proven management team . Increased scale to invest in franchise . Proven & sustainable business model . Well managed through the cycle . Conservative operating philosophy . Consistent profitability – 114 consecutive quarters . Top quartile performer – ROAA
Slide 12: Invest in First Financial: Total Shareholder Return
Invest in First Financial Total Shareholder Return1,2,3,4 56.0% 56.5% 53.5% 43.6% 38.2% 28.8% 13.2% 8.7% 2.2% -4.6% -11.9% -15.7% 5 Year 3 Year 1 Year YTD 2019 FFBC KBW Peer Median KBW Peer Top Quartile 1 Includes dividend reinvestment. 2 Peer group includes KBW regional bank index peers. 3 Based on
Slide 13: Presentation Contents
Presentation Contents About First Financial Bancorp Financial Performance Appendix 13
Slide 14: 1Q 2019 Results
1Q 2019 Results 114th Consecutive Quarter of Profitability . Net income = $45.8 million or $0.47 per diluted share. Adjusted net income = $47.4 million or $0.48 per diluted share1,2. . Return on average assets = 1.33%. Adjusted return on average assets = 1.38%1. . Profitability Return on average sha
Slide 15: 1Q 2019 Highlights
1Q 2019 Highlights Solid quarterly earnings Adjusted1 earnings per share - $0.48 Adjusted1 return on assets – 1.38% Adjusted1 return on average tangible common equity – 16.45% Net income reduced by $7.9 million after-tax, or $0.08 per share, for a single franchise charge-off Adjusted1 earnings exclu
Slide 16: Adjusted Net Income
Adjusted Net Income 1 The table below lists certain adjustments that we believe are significant to understanding our quarterly performance. 1Q 2019 4Q 2018 As Reported Adjusted As Reported Adjusted Net interest income $ 121,515 $ 121,515 $ 125,959 $ 125,959 Provision for loan and lease losses $ 14,0
Slide 17: Profitability
Profitability Diluted EPS Return on Average Assets 1.72% 1.60% 1.64% $0.61 1.49% $0.57 $0.58 1.38% $0.52 $0.48 1.59% 1.45% $0.56 1.40% 1.33% $0.49 $0.51 $0.47 1.05% $0.37 1Q18 2Q18 3Q18 4Q18 1Q19 1Q18 2Q18 3Q18 4Q18 1Q19 ROA Adjusted ROA 1 DilutedEPS Adjusted EPS1 Return on Avg Tangible Common Equit
Slide 18: Net Interest Margin
Net Interest Margin Net Interest Margin (FTE) 1Q19 NIM (FTE) Progression 4Q18 4.21% 4.21% Asset yields 0.14% 4.15% 4.12% 4.10% 0.29% Asset mix -0.03% 0.29% 0.29% 0.23% 3.84% Loan fees -0.06% 0.17% 0.11% 0.15% 0.15% 0.13% Funding costs -0.09% Funding mix -0.01% 3.75% 3.76% 3.69% 3.71% 3.70% Purchase
Slide 19: Average Balance Sheet
Average Balance Sheet Average Loans Average Deposits 5.73% 5.69% 5.49% 5.53% 0.78% 0.60% 0.57% 0.59% 0.68% 5.05% $8,933 $8,849 $8,766 $8,773 $10,383 $9,888 $10,050 $10,068 $6,018 $6,903 1Q18 2Q18 3Q18 4Q18 1Q19 1Q18 2Q18 3Q18 4Q18 1Q19 1 Gross Loans Loan Yield (Gross) Total Deposits Cost of Deposits
Slide 20: Loan Portfolio
Loan Portfolio Loan LOB Mix (EOP) Net Loan Change-LOB (Linked Quarter) Total $8.8 billion ICRE $55.0 $1,107 Commercial -$26.4 13% $2,763 1 Small Business Banking -$41.2 $1,017 31% 12% Consumer -$18.2 $891 Mortgage $20.8 10% Commercial Finance -$5.1 $1,249 $1,782 14% 20% Other $0.1 ICRE Commercial Sm
Slide 21: Loan Portfolio: C&I by Industry, CRE by Collateral
Loan Portfolio C&I Loans by Industry 1 CRE Loans by Collateral 2 C&I Loans: $3.7B CRE Loans: $3.1B Wholesale Trade Hotel/Motel 6% 11% Real Estate and Agriculture, Manufacturing Strip Center Nursing/Assisted Rental and Forestry, Fishing 13% Office Living Leasing and Hunting 7% 15% 6% 9% 6% Residentia
Slide 22: Deposits
Deposits Deposit Product Mix (Avg) 1Q19 Average Deposit Progression Total $10.1 billion Interest-bearing demand -$55.2 $1,354 $2,324 14% 23% Public Funds -$59.7 $1,453 Savings $4.1 14% $731 7% Money Markets -$41.2 $890 $1,403 9% Retail Time Deposits $51.9 14% $1,913 19% Brokered CDs $104.8 Nonintere
Slide 23: Investment Portfolio
Investment Portfolio . Total EOP investments of approximately $3.4 billion . Investment portfolio / total assets = approximately 24% . Portfolio duration = estimated 3.1 years Portfolio Composition Portfolio Quality Corporate Regulatory Debt obligations of U.S. securities, 2% Non-Agency stock, 3% Go
Slide 24: Noninterest Income and Noninterest Expense
Noninterest Income and Noninterest Expense Noninterest Income Noninterest Expense1 Total $26.8 million Total $78.5 million $4,674 $15,414 18% 20% $8,903 $1,890 33% $5,127 7% 6% $1,704 $47,912 6% $10,046 61% 13% $5,586 $4,070 21% 15% Service Charges Wealth Mgmt Salaries and benefits Occupancy and equ
Slide 25: Asset Quality
Asset Quality Classified Assets / Total Assets Nonperforming Assets / Total Assets 1.00% 1.00% 0.63% 0.98% 0.94% 1.01% 0.60% 0.52% $139.3 $138.9 $142.0 0.46% 0.47% $131.7 $88.2 $83.9 $64.2 $64.6 $46.3 $87.6 1Q18 2Q18 3Q18 4Q18 1Q19 1Q18 2Q18 3Q18 4Q18 1Q19 Classified Assets Classified Assets / Total
Slide 26: Franchise Lending Portfolio
Franchise Lending Portfolio Overview Quality Portfolio . Well-regarded national brand concepts • Top 15 concepts comprise 80% of $9.4 $12.7 portfolio outstandings 2% 2% • Financing for acquisition, development of new stores, and remodeling of existing stores . Disciplined portfolio management • Annu
Slide 27: Capital
Capital Total Capital Ratio Tier 1 Common Equity Ratio 14.10% 14.24% 12.03% 13.77% 11.87% 13.17% 13.36% 11.52% 12.50% 10.50% 11.15% 10.77% 1Q18 2Q18 3Q18 4Q18 1Q19 1Q18 2Q18 3Q18 4Q18 1Q19 Tier 1 Common Equity Ratio Target Total Capital Ratio Target Tangible Common Equity Ratio 9.15% 8.79% 8.53% 8.4
Slide 28: 2Q19 Outlook
2Q19 Outlook1 . Annualized loan growth expected to be in the low to mid single digits on a Balance Sheet percentage basis . NIM (FTE) 3.81 - 3.86%, excluding purchase accounting impact Net Interest Margin . Compares to 3.87% in 1Q19 . Credit Stable credit outlook . Noninterest income2 Seasonal incre
Slide 29: Presentation Contents
Presentation Contents About First Financial Bancorp Financial Performance Appendix 29
Slide 30: Appendix: Our Markets
Appendix: Our Markets . . Greater Cincinnati Indianapolis . . Loans $2.7 billion Loans $1.1 billion . . Deposits $2.5 billion Deposits $0.7 billion . . Deposit Market Share #4 (3.2%) Deposit Market Share #14 (1.6%) . . Banking Centers 54 Banking Centers 10 . . Fortune 500 Companies 9 Fortune 500 Com
Slide 31: Appendix: Non-GAAP Measures
Appendix: Non-GAAP Measures The Company’s earnings release and accompanying presentation contain certain financial information determined by methods other than in accordance with accounting principles generally accepted in the United States (GAAP). Such non-GAAP financial information should be consi
Slide 32: Appendix: Non-GAAP to GAAP Reconciliation
Appendix: Non-GAAP to GAAP Reconciliation Net interest income and net interest margin - fully tax equivalent Three months ended Mar. 31, Dec. 31, Sep. 30, June 30, Mar. 31, 2019 2018 2018 2018 2018 Net interest income $ 121,515 $ 125,959 $ 123,485 $ 123,979 $ 75,812 Tax equivalent adjustment 1,523 1
Slide 33: Appendix: Non-GAAP to GAAP Reconciliation
Appendix: Non-GAAP to GAAP Reconciliation Additional non-GAAP ratios Three months ended Mar. 31, Dec. 31, Sep. 30, June 30, Mar. 31, (Dollars in thousands, except per share data) 2019 2018 2018 2018 2018 Net income (a) $ 45,839 $ 55,014 $ 50,657 $ 36,418 $ 30,506 Average total shareholders' equity 2
Slide 34: Appendix: Non-GAAP to GAAP Reconciliation
Appendix: Non-GAAP to GAAP Reconciliation Additional non-GAAP measures 1Q19 4Q18 3Q18 2Q18 1Q18 (Dollars in thousands, except per share data) As Reported Adjusted As Reported Adjusted As Reported Adjusted As Reported Adjusted As Reported Adjusted Net interest income (f) $ 121,515 $ 121,515 $ 125,959
Slide 35: fiRST
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