Cvb Financial Corporation · NASDAQ:CVBF
Cvb Financial — Q3 2013 Earnings Presentation
44 slides from Cvb Financial's earnings presentation, Oct 30, 2013
Slide 1: 3Q Results 2013
October 2013 Exhibit 99.1 3Q Results 2013 | cbbank.com
Slide 2: Safe Harbor
3Q Results 2013 | cbbank.com Safe Harbor Certain matters set forth herein (including the exhibits hereto) constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including forward-looking statements relating to the Company's current business
Slide 3: CVB Financial Corp. (CVBF)
Total Assets: $6.6 Billion Gross Loans: $3.4 Billion Total Deposits (Including Repos): $5.5 Billion Total Equity: $768 Million 3Q Results 2013 | cbbank.com Source: Q3 2013 earnings release & company filings. *non-covered loans CVB Financial Corp. (CVBF) Largest financial institution headquartered in
Slide 4: Experienced Leadership
Experienced Leadership 3Q Results 2013 | cbbank.com Name Position Banking Experience CVBF Service Christopher D. Myers President & CEO 29 Years 7 Years Richard C. Thomas Executive Vice President Chief Financial Officer 4 Years 3 Years James F. Dowd Executive Vice President Chief Credit Officer 36 Ye
Slide 5: Board of Directors
Board of Directors 3Q Results 2013 | cbbank.com Name CVB Experience Age Ronald Kruse – Chairman 38 Years Linn Wiley - Vice Chairman 21 Years George Borba Jr. 1 Year Steve Del Guercio 1 Year Robert Jacoby 7 Years Ray O’Brien 1 Year San Vaccaro 13 Years Chris Myers - CEO 7 Years
Slide 6: Who is CVB Financial Corp.
Who is CVB Financial Corp. 3Q Results 2013 | cbbank.com
Slide 7: Largest Banks Headquartered in California
12 CVB Financial Corp. $6,426 3Q Results 2013 | cbbank.com Largest Banks Headquartered in California Source: SNL Financial Rank Name Asset Size (6/30/13) Wells Fargo $1,440,563 Union Bank $102,279 Bank of the West $63,530 First Republic Bank $37,313 City National Bank $27,380 OneWest Bank $25,421 Ea
Slide 8: Bank Accomplishments & Ratings
Bank Accomplishments & Ratings 3Q Results 2013 | cbbank.com 146 Consecutive Quarters of Profitability 96 Consecutive Quarters of Cash Dividends #8 Rated Bank: BankDirector Magazine Bank Performance Scorecard (August 2013) BauerFinancial Report Five Star Rating (July 2013) Fitch Rating BBB (September
Slide 9: Our Markets
Our Markets 3Q Results 2013 | cbbank.com
Slide 10: Business Financial Centers and Locations
39 Business Financial Centers 6 Commercial Banking Centers 3 CitizensTrust Locations Existing Locations 3Q Results 2013 | cbbank.com Corporate Office Business Financial Centers Commercial Banking Centers CitizensTrust San Diego Opening February 2014
Slide 11: Deposits by Region
Deposits* (000’s) # of Center Locations Total Deposits (9/30/12) Total Deposits (9/30/13) 3Q Results 2013 | cbbank.com Los Angeles County $1,962,327 $1,913,762 Inland Empire (Riverside & San Bernardino Counties) $1,603,850 $1,763,235 Central Valley $830,490 $863,738 Orange County $586,297 $662,013 O
Slide 12: Non-Interest Bearing Deposits
Non-Interest Bearing Deposits 3Q Results 2013 | cbbank.com (000’s) $1,000,000 $1,200,000 $1,400,000 $1,600,000 $1,800,000 $2,000,000 $2,200,000 $2,400,000 $2,600,000
Slide 13: Deposit Cost Comparison
3Q Results 2013 | cbbank.com Deposit Cost Comparison Source: Q3 2013 earnings release & other company filings, SNL Financial—peers represent public CA , AZ, HI, NV, OR & WA banks with assets $2 - $25 billion. Peer data as of 06/30/13 0.00% 0.50% 1.00% 1.50% 2.00% 2.50% 3.00% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Slide 14: Total Loans as of 9/30/2013
(000’s) Non- Covered Loans* Covered Loans* Total Loans* % Los Angeles County $1,242,392 $10,580 $1,252,972 36.13% Central Valley $689,656 $156,076 $845,732 24.38% Inland Empire (Riverside & San Bernardino Counties) $605,779 $962 $606,741 17.49% Orange County $490,385 $0 $490,385 14.14% Other $262,25
Slide 15: Total Non-Covered Loans
3Q Results 2013 | cbbank.com Total Non-Covered Loans (000’s) Net of deferred fees $2,000,000 $2,200,000 $2,400,000 $2,600,000 $2,800,000 $3,000,000 $3,200,000 $3,400,000 $3,600,000 $3,800,000
Slide 16: Loan Portfolio Composition
Loan Portfolio Composition Total Loans by Type 3Q Results 2013 | cbbank.com Source: Q3 2013 earnings release & company reports |Covered & Non Covered Municipal Lease Finance Receivables, 2.9% Dairy, Livestock & Agribusiness, 7.7% Commercial & Industrial, 15.3% Construction RE, 1.4% Commercial RE - O
Slide 17: New/Enhanced Lending Initiatives
3Q Results 2013 | cbbank.com New/Enhanced Lending Initiatives • Residential Real Estate • Multi-Family • Asset Based Lending
Slide 18: Other Lending Areas
Other Lending Areas For Future Consideration/Expansion • Residential and Commercial Construction • Medical Equipment/Office • Equipment Lending & Leasing • Private Banking 3Q Results 2013 | cbbank.com
Slide 19: Total Covered Loans
3Q Results 2013 | cbbank.com Total Covered Loans Net of Discount Net of Discount Includes Loans Held for Sale $184 million $184 million $- $100,000 $200,000 $300,000 $400,000 $500,000 $600,000 $700,000 $800,000 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 (000’s) $14.5 million $14.5 million
Slide 20: Non-Performing Assets Non-Covered
Non-Performing Assets Non-Covered (000’s) $ $20,000 $40,000 $60,000 $80,000 $100,000 $120,000 $140,000 $160,000 $180,000 $200,000 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q4 Q1 Q2 Q3 Non Performing Loans OREO - - 3Q Results 2013 | cbbank.com Q3
Slide 21: Classified Loans Non-Covered
Classified Loans Non-Covered 3Q Results 2013 | cbbank.com $- $100,000 $200,000 $300,000 $400,000 $500,000 $600,000 $700,000 $800,000 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 (000’s)
Slide 22: Profits
Profits 3Q Results 2013 | cbbank.com
Slide 23: Net Income
Net Income (000’s) Net Income After Taxes $20.4 million FHLB prepayment charge 3Q Results 2013 | cbbank.com $- $2,500 $5,000 $7,500 $10,000 $12,500 $15,000 $17,500 $20,000 $22,500 $25,000 $27,500 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3
Slide 24: Earnings
(000’s) 2009 2010 2011 2012 9 Months to 9/30/2013 Net Interest Income $222,264 $259,317 $234,681 $236,950 $161,157 Provision for Loan Losses ($80,500) ($61,200) ($7,068) $0 ($9,950) Other Operating Income/Expenses (Net) ($52,515) ($111,378) ($106,809) ($122,257) ($65,363) Income Taxes ($23,830) ($23
Slide 25: Net Interest Margin
Net Interest Margin *Normalized excludes accelerated accretion on covered loans Normalized* 3Q Results 2013 | cbbank.com 1.50% 1.75% 2.00% 2.25% 2.50% 2.75% 3.00% 3.25% 3.50% 3.75% 4.00% 4.25% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3
Slide 26: Expenses
Expenses 3Q Results 2013 | cbbank.com
Slide 27: Expenses
3Q Results 2013 | cbbank.com Expenses *Includes $20.4 million FHLB prepayment charge (000’s) 9 Months to 9/30/2013 Salaries & Employee Benefits $69,419 $69,993 $68,496 $52,777 Promotion & Entertainment $6,084 $4,977 $4,869 $3,503 Stationary & Supplies $4,965 $3,645 $3,592 $2,681 Software Licenses &
Slide 28: Bank Borrowings
Bank Borrowings 3Q Results 2013 | cbbank.com
Slide 29: Outstanding Debt as of 09/30/2013
Outstanding Debt as of 09/30/2013 Type of Debt Balance at 09/30/2013 Interest Rate FHLB Advance* $199,070 4.52% Fixed Other Borrowings (overnight) $0 Subordinated Debentures CVB Statutory Trust III $25,774 3-Month LIBOR + 1.38% Total $224,844 (000’s) *FHLB Advance maturity is November, 28 2016. As o
Slide 30: Capital
Capital 3Q Results 2013 | cbbank.com
Slide 31: Capital Ratios
Regulatory Minimum Ratio Regulatory Well-Capitalized Ratio June 30, 2013* Tier 1 Risk-based Capital Ratio 4.0% 6.0% 18.13% Total Risk-based Capital Ratio 8.0% 10.0% 19.39% Tier 1 Leverage Ratio 4.0% 5.0% 11.55% Tangible Capital Ratio 10.91 % Core Tier 1 Capital Ratio 17.49% Capital Ratios 3Q Results
Slide 32: Securities & Investments
Securities & Investments 3Q Results 2013 | cbbank.com
Slide 33: Securities Portfolio $2.62 Billion
Securities Portfolio* --$2.62 Billion-- 3Q Results 2013 | cbbank.com *Securities Available For Sale Securities portfolio totaled $2.62 billion at 9/30/2013. The portfolio represents 39.9% of the Bank’s total assets Virtually all of the Bank’s mortgage-backed securities were issued by Freddie Mac or
Slide 34: Securities Portfolio Mark-to-Market
Securities Portfolio* $2.62 Billion Mark-to-Market (Pre - tax) *Securities Available For Sale $7,348 3Q Results 2013 | cbbank.com $0 $10,000 $20,000 $30,000 $40,000 $50,000 $60,000 $70,000 $80,000 $90,000 Jun Sep Dec Mar Jun Sep Dec Mar Jun Sep Dec Mar Jun Sep Dec Mar Jun Sept (000’s)
Slide 35: CVBF Assets
CVBF Assets *Includes overnight funds held at the Federal Reserve, Interest earning - due from Correspondent Banks, other short-term money market accounts or certificates of deposit 9/30/13 $6.6 Billion 12/31/06 $6.1 Billion 3Q Results 2013 | cbbank.com
Slide 36: Yield on Securities vs. Yield on Loans
3Q Results 2013 | cbbank.com Yield on Securities vs. Yield on Loans *Excluding Discount Accretion 0.00% 1.00% 2.00% 3.00% 4.00% 5.00% 6.00% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Yield on Loans* Yield on Securities
Slide 37: CVBF Liabilities
CVBF Liabilities Total Deposits*, 61.4% Borrowings, 36.0% Total Deposits*, 94.3% 3Q Results 2013 | cbbank.com 12/31/06 $5.7 Billion 9/30/13 $5.8 Billion *Includes Customer Repurchase Agreements Junior subordinated Debentures, 0.5% Other Liabilities, 1.0% Junior subordinated Debentures, 1.9% Other Li
Slide 38: Our Growth Strategy
Our Growth Strategy 3Q Results 2013 | cbbank.com
Slide 39: Our Vision
Citizens Business Bank will strive to become the dominant financial services company operating throughout the state of California, servicing the comprehensive financial needs of successful small to medium sized businesses and their owners. 3Q Results 2013 | cbbank.com Our Vision
Slide 40: Target Customer
Target Customer 3Q Results 2013 | cbbank.com The best privately-held and/or family-owned businesses throughout California Annual revenues of $1-200 million Top 25% in their respective industry Full relationship banking Build 20-year relationships
Slide 41: Three Areas of Growth
3Q Results 2013 | cbbank.com Three Areas of Growth
Slide 42: Acquisition Strategy
• Target size: $200 million to $2 billion in assets • Financial & Strategic • In-market and/or adjacent geographic market (California only) Acquisition Strategy • Target size: AUM of $200 million to $1 billion • In California • In- market & ‘new’ markets 3Q Results 2013 | cbbank.com -- Banks - - --
Slide 43: Our 'Critical Few'
Our ‘Critical Few’ Loan Growth Expand Credit Product Offerings & Capabilities Build Core Deposits Drive Service Charge & Fee Income Growth Manage Operating Efficiency Grow Through Acquisition 3Q Results 2013 | cbbank.com
Slide 44: Copy of presentation at www.cbbank.com
Copy of presentation at www.cbbank.com 3Q Results 2013 | cbbank.com