Park National Corporation · AMEX:PRK
Park National — Keefe, Bruyette & Woods Winter Financial Services Symposium 2018
29 slides from Park National's conference presentation, Feb 7, 2018
Slide 1: KBW Winter Financial Services Symposium
February 7-9, 2018 Keefe, Bruyette & Woods Winter Financial Services Symposium 1
Slide 2: Safe Harbor Statement
Safe Harbor Statement 2 Park cautions that any forward-looking statements contained in this presentation or made by management of Park are provided to assist in the understanding of anticipated future financial performance. Forward-looking statements provide current expectations or forecasts of futu
Slide 3: Safe Harbor Statement (cont.)
3 Safe Harbor Statement (cont.) These forward-looking statements include, but are not limited to, statements relating to the expected timing and benefits of the proposed merger (the “Merger”) between Park National Corporation (“Park”), The Park National Bank and NewDominion Bank (“NewDominion”), inc
Slide 4: Park National Corporation (PRK) Profile
Park National Corporation (PRK) Profile (as of December 31, 2017) • 11 Community Bank Divisions • 2 Specialty Finance Companies • One non-bank workout subsidiary • 29 Ohio counties • 108 bank branches • 6 specialty finance offices • 1,746 FTEs 4
Slide 5: Park Senior Management
Park Senior Management • David L. Trautman – President and CEO – Age: 56 President , CEO and Board Member of The Park National Bank and Park National Corporation (Park) headquartered in Newark, Ohio. He served as President of First-Knox National Bank, a division of The Park National Bank, from May 1
Slide 6: Park Senior Management (continued)
Park Senior Management (continued) • Matthew R. Miller – Executive Vice President – Age: 39 Executive Vice President of Park since April 2017. Formerly served as the Chief Accounting Officer of Park from December 2012 to April 2017, and as an Accounting Vice President from April 2009 to December 201
Slide 7: Experienced Leadership Team
Experienced Leadership Team Name Position Age Years with PRK Years In Industry David L. Trautman President & CEO 56 34 34 C. Daniel DeLawder Chairman 68 46 46 Matthew R. Miller Executive Vice President 39 8 14 Brady T. Burt Chief Financial Officer 45 10 16 • Senior leadership consists of executives
Slide 8: Leadership Team – continued
Leadership Team – continued Name Position Age Years with PRK Years In Industry Lindsay M. Alton AVP – Interim Chief Risk Officer 35 14 14 Adrienne M. Brokaw SVP – Director of Internal Audit 50 4 18 Thomas J. Button SVP – Chief Credit Officer 57 21 32 Thomas M. Cummiskey SVP – Trust 48 18 20 Kelly A.
Slide 9: Affiliate Leadership
Affiliate Leadership Name Position Age Years with PRK/Affiliate Years In Industry Brett A. Baumeister President – Unity National Bank 51 13 27 John A. Brown President – Security National Bank 48 26 26 David J. Gooch President – Park National Bank of Southwest Ohio & Northern Kentucky 48 20 26 Chris
Slide 10: Highlights of 2017
Highlights of 2017 • Loan growth of $104.4 million in 2017 (1.99%) at Park National Corporation’s (PRK) national bank subsidiary, The Park National Bank (PNB). • Credit quality remains strong: PRK and PNB experienced net charge-offs of 17 basis points (bps) and 21 bps in 2017, respectively. Delinque
Slide 11: PRK ROA and ROE History
PRK and PRK, excluding Vision & Southeast Property Holdings, LLC (SEPH) ROA and ROE History 1 Calculated using average common equity for Park National Corporation. 2 Calculated using average common equity for Park National Corporation, excluding Vision Bank and SE Property Holdings, LLC. 3 Adjusted
Slide 12: The Park National Bank – The bank of choice
The Park National Bank – The bank of choice Source: SNL, June 30, 2017 Headquarter Counties – Deposits (in thousands) 12 Bank Division Year Joined Park Hdqtr. Co. Deposits Total County Deposits % of 2017 Market Share % of 2016 Market Share 2017 Headquarter County Market Share Rank 2016 Headquarter C
Slide 13: Park National Corporation Consolidated Statements of Income
Source: Company Filings 13 (in thousands) Dec. 31, 2017 Dec. 31, 2016 Dec. 31, 2015 Net interest income $ 243,759 $ 238,086 $ 227,632 Provision for (recovery of) loan losses 8,557 (5,101) 4,990 Net interest income after provision for (recovery of) loan losses $ 235,202 $ 243,187 $ 222,642 Other inco
Slide 14: Park National Corporation Consolidated Balance Sheets
Source: Company Filings 14 Park National Corporation Consolidated Balance Sheets (in millions) Dec. 31, 2017 Dec. 31, 2016 Dec. 31, 2015 Cash & cash equivalents $ 169 $ 146 $ 149 Investment securities 1,513 1,580 1,644 Loans 5,372 5,272 5,068 Allowance for loan losses (50) (51) (56) Other assets 534
Slide 15: Quarterly Net Income (Loss) by Operating Segment
Quarterly Net Income (Loss)by Operating Segment Source: Company Filings (In thousands) Q4 2017 Q3 2017 Q2 2017 Q1 2017 2017 2016 2015 PNB $24,369 $21,297 $20,163 $21,486 $87,315 $84,451 $84,345 GFSC (208) 84 186 198 260 (307) 1,423 Park Parent Company 1 (417) 105 (919) (1,226) (2,457) (4,557) (4,549
Slide 16: The Park National Bank Consolidated Statements of Income
Source: Company Filings 16 The Park National Bank Consolidated Statements of Income (in thousands) Dec. 31, 2017 Dec. 31, 2016 Dec. 31, 2015 Net interest income $ 235,243 $ 227,576 $ 220,879 Provision for loan losses 9,898 2,611 7,665 Net interest income after provision for loan losses $ 225,345 $ 2
Slide 17: Park National Bank Balance Sheet Highlights
Park National Bank Balance Sheet Highlights Source: Company Filings (In thousands) December 31, 2017 December 31, 2016 % change from 12/31/16 Loans $ 5,339,255 $ 5,234,828 1.99% Allowance for loan losses 47,607 48,782 (2.41)% Net loans 5,291,648 5,186,046 2.04% Investment securities 1,507,926 1,573,
Slide 18: Park National Bank Loans by Type
Park National Bank Loans by Type Source: Company Filings as of December 31, 2017 • Commercial lending focus is on small, closely-held businesses within our markets. • Consumer mortgage and home equity portfolios are originated by Park within our footprint and have been consistently underwritten for
Slide 19: Park National Bank Indirect Loans
19 Park National Bank Indirect Loans Source: Company Filings Dec. 31, 2014 Dec. 31, 2015 Dec. 31, 2016 Dec. 31, 2017 Other $151,489 $154,172 $106,872 $86,425 Boat/RV $32,821 $68,096 $138,483 $184,862 Auto $507,245 $541,307 $668,018 $778,711 Total Indirect Loans $691,555 $763,575 $913,373 $1,049,998
Slide 20: Park National Corporation Nonperforming assets
Park National Corporation Nonperforming assets 1 The carrying balance of impaired commercial loans as a percentage of unpaid principal balance at December 31, 2017 was 83.9% and 100.0% for Park National Corporation and SEPH, respectively. 2 At December 31, 2017, Vision/SEPH participations included i
Slide 21: Nonperforming assets and peer group information
Source: BHC Performance Report and Company Filings (in thousands) Dec. 31, 2017 Dec. 31, 2016 Dec. 31, 2015 Non-accrual loans $ 61,753 $ 76,084 $ 81,468 Renegotiated loans 20,111 18,175 24,979 Loans past due 90 days or more (still accruing) 1,792 2,086 1,921 Total nonperforming loans $ 83,656 $ 96,3
Slide 22: PRK comparison to peers
PRK comparison to peers 1 Due to unavailability of 4Q 2017 peer median financial metrics, data utilized herein reflects 3Q 2017 peer results. Source: Company Filings and SNL data of $3 to $10 billion bank holding companies PRK Price to Book % Peer Group Price to Book % PRK Price to tangible book Pee
Slide 23: A Successful History of Disciplined Strategic Growth in Ohio
A Successful History of Disciplined Strategic Growth in Ohio (11 acquisitions; 2 De Novos) 1908 1908 The Park National Bank is established 1985 1985 Acquisition of Fairfield National Bank 1987 1987 Park National Corporation holding company is established Acquisition of Richland Trust Company
Slide 24: Strategic Partnership and Expansion into North Carolina
24 and Strategic Partnership and Expansion into North Carolina NYSE AMERICAN: PRK | OTC PINK: NDMN
Slide 25: Park National / NewDominion – Transaction Overview
Park National / NewDominion – Transaction Overview 25 Deal value: Blended deal value: $76.4 million1 $79.9 million1,2 Consideration: Option to elect $1.08 in cash or 0.01023 shares of Park common stock for each share of NewDominion common stock, subject to a 60% stock / 40% cash structure Per share
Slide 26: Park National / NewDominion – Selected Highlights
Park National / NewDominion – Selected Highlights 26 Pro Forma Branch Map Transaction Metrics1 Blended price per share / TBVPS: 200.9% Blended price per share / adj. TBVPS2: 188.1% Blended price per share / 2019 EPS w/ synergies: 13.4x NewDominion pro forma ownership: 2.8%Park Branches (108)
Slide 27: Park National / NewDominion – Strategic Rationale
Park National / NewDominion – Strategic Rationale 27 Demographically accretive, given attractive Charlotte market demographics − Charlotte’s five-year population growth rate projected to be 11x Ohio average and 2x national average (Nielsen) − Charlotte is the largest metropolitan area in the Carol
Slide 28: PRK M&A Strategy
PRK M&A Strategy Two prong strategy guidelines: • Traditional M&A • Strong franchise, good reputation • Good market share • Existing leadership continuity • Traditional community bank structure • Core deposits • Metro Strategy – Attractive markets in the Midwest / Southeast / Mid-Atlantic states • O
Slide 29: KBW Winter Financial Services Symposium
February 7-9, 2018 Keefe, Bruyette & Woods Winter Financial Services Symposium 29
Park National — Keefe, Bruyette & Woods Winter Financial Services Symposium 2018 on 6ix