City Holding Company · NASDAQ:CHCO
City — Investor Presentation (July 2002)
28 slides from City's investor presentation, Jul 25, 2002
Slide 1: City Holding Company
Ci GES
Slide 2: City Holding at a glance
Cityeoes, = $2.0 Billion Commercial Bank headquartefed in Charleston WV a 55 Banking Offices 2 151,000 households; 291,000 accounts = 16,905,734 common shares outstanding ss $406 million market capitalization
Slide 3: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS All statements other than statements of historical fact included in this Form 10-Q Quarterly Report, including statements in Management's Discussion and Analysis of Financial Condition and Result of Operations are, or may be deemed to be, forward-looking statements within
Slide 4: Prior History
Prior History = $38 million loss reported in 2000 = Formal Agreements with OCC and Federal Reserve = $130 million in “problem loans” = Stock trading at $5.125 per share from a high (in 1998) of $45 per share; discontinued common share cash dividends = Ownership of non-core businesses which diluted f
Slide 5: Managing the Turnaround
Managing the Turnaround = Jerry Francis becomes CEO 1/31/01 ¢ 31 years in banking First National Bank, Dayton. « National City + Metropolitan Bank, Lima - President « Bank One - Regional President « Peoples Bank of Indianapolis - President
Slide 6: Assembling The Management Team
Assembling The Management Team = Skip Hageboeck, PhD, CFO and CIO 13 years in banking Indiana National, NBD, Peoples Bank of Indianapolis = John Loeber, Commercial Banking and Senior Credit Officer @ 35 years in banking Fleet Boston Financial, First American, Signet, Peoples Bank of Indianapolis = B
Slide 7: It's All About Management
It’s All About Management Earnings Per Share (Fully Stock Price (NASDAQ; PPLS) Diluted) AY $305 $2.92 Pe) n $1 $2 $205 ae ub pein = San 1800 | s st | | | il gio $1213 sus L $0 = arama 94 19S 1996971998199 1904 1995 1096 19071088 1909
Slide 8: Writing It Down
Writing It Down = By April 1, 2001: ¢ Exited the mortgage servicing business ¢ Wrote down $30 million in accordance with new accounting guidance related to retained interest in securitized loans ¢ Wrote off $7.9 million to reflect unrecognized losses ¢ Charged off $7.5 million in loans ¢ Took provis
Slide 9: Revenue Enhancement/Best Practices
Revenue Enhancement/Best Practices = By June 30, 2001 ¢ Initiated revenue enhancement and “best practices” projects: « Increased collection of service fees from < 50% to over 90% resulting in 60% increase in service charge revenue ¢ Reduced staff by 27% with annual savings of $7 million + Implemente
Slide 10: Focus On Credit
Focus On Credit = By September 30, 2001: ¢ Reviewed 100% of commercial loans & assigned risk tating; scored all 66,000 Retail loans; adopted a formal and comprehensive loan policy ¢ Centralized loan underwriting and loan approval ¢ Hired experienced loan workout team of 7 persons ¢ Charged off $2.9
Slide 11: Returning To Profitability
Returning To Profitability = By December 31, 2001: ¢ Retumed to profitability with operating ROA of 0.86% and ROE of 13.3% ¢ Initiated 4 month comprehensive credit training program for commercial lenders ¢ Complied fully with OCC and Fed agreements @ Sold $18 million of substandard loans ¢ Charged o
Slide 12: High Performance
High Performance a By June 30, 2002: + Reported second quarter ROA of 1.48% and ROE of 19.7% ¢ Increased earnings guidance to $1.70 to $1.80 per share from $1.25 to $1.50 Terminated Formal Agreements with OCC and Federal Reserve « Announced resumption of common dividends and payment of Trust Preferr
Slide 13: Gatewater Road
25 Gatewater Road Charleston, West Virginia 25313 04) 769° 1106 wwrw.ciyholding.com
Slide 14: Deposit Market Share
Deposit Market Share 40% 35% 30% 25% 20% 15% 10% 5% 0% Charleston $3.1B Market ‘Huntington $2.3B Market 1 | Beckley/Lewisburg Eastern Panhandle $1.6B Market $1.6B Market
Slide 15: Our Business Model
Our Business Model © We are a retail bank © We focus on core deposit gathering © We employ a simple business model
Slide 16: City National Bank Customer Profile
City National Bank Customer Profile 250,000 222.208 200,000 140,458 150,000 i m3 100,000 50,000 10.086 9, m # Customers: # Deposit Accounts Retail 1 Commer cial
Slide 17: City National Bank Customer Profile
City National Bank Customer Profile $1,600,000 $1,400,000 $1,200,000 $1,000,000 $800,000 $600,000 $400,000 $200,000 $0 $1,376,145 $769,760 ee) =H ($427,635 $ Deposit Accounts $ Loan Accounts GRetal Commercial
Slide 18: Liability Mix
Liability Mix City National Bank Peer Group 14% 1 Transaction & = Time <$100k = Time >$100k; Repo & Other Borr Core Deposit to Asset Ratio 63%! Core Deposit to Asset Ratio 75%
Slide 19: Loan Mix
Loan Mix City National Bank Peer Group oye 18% 25% 35% = Residential RE Home Equ Consumer/Gther Comm RE c&l = Residential RE Home Equi Consumer /Other Comm RE C&I Loan to Asset Ratio 58.1% Loan to Asset Ratio 61.9% Loan to Core Deposits 78.7% Loan to Core Deposits 99.9% |,
Slide 20: Revenue Profile
Revenue Profile City Holding Company Peer Grown 21% 23% 2% NIL @ Fees NIL
Slide 21: Nonperforming Assets/Total Loans + OREO
Nonperforming Assets/Total Loans + OREO 1.21% 129%
Slide 22: Loan Loss Reserve/Total Loans
Loan Loss Reserve/Total Loans 40% 35% 3.0% GMM 2.06% 2.06% 20% 15% 10% 05% 0.0% 3.44% 3.50% Ss gs & SS § & s & cS s x e » é 3s
Slide 23: 197% 188% 175% 171% 122%
197% 188% 175% 171% 122%
Slide 24: Net Charge-Offs/Opportunity?
Net Charge-Offs/Opportunity? In Millions 1999 2000 2001 2002 YTD.
Slide 25: Efficiency Ratio
wo 102 © @.02 ‘Efficiency Ratio Peet 50% 45%, 40% 45% 40% 25% 1.01 4-01 12 2.0 Qi-02 @2-02 Peer 5
Slide 26: Performance Objectives
Performance Objectives Seeeseeaw
Slide 27: Why Should You Own Our Stock?
Why Should You Own Our Stock? = Strong market share franchise in best WV regions = Retail focus provides attractive return for risk = Proven “result-oriented” management team = Management/shareholder alignment + Performance-based incentive plans for all employees * Value-vested stock options + Execu
Slide 28: CHCO Stock Performance
CHCO Stock Performance Relative Stock Price Performance Versus Major Indices: Since January 31, 2001 _ —— sar so NASDAQ Banik Index. En VID 002 07 Price Change Prive Change PE PE oo 2 a Heuco 109 Ba see {ASDAQ Bask Index 0 a ne a 500 13 ng 185 Laced on duty 17, 2002 closing ices