Park National Corporation · AMEX:PRK
Park National — KBW Investor Presentation (July 2009)
41 slides from Park National's conference presentation, Jul 27, 2009
Slide 1: KBW Investor Presentation July 28, 2009
KBW Investor Presentation July 28, 2009
Slide 2: Forward-looking Statements
Forward-looking Statements This presentation contains forward-looking statements that are provided to assist in the understanding of anticipated future financial performance. Forward-looking statements provide current expectations or forecasts of future events and are not guarantees of future perfor
Slide 3: Table of Contents
Table of Contents PRK Overview Leadership Team Selected Financial Data Peer Group Comparison Why invest in Park National Corporation? Appendix: Profiles of PRK Affiliate Banks
Slide 4: Park National Corporation is a $7.0 billion bank holding company
Park National Corporation (Park) is a $7.0 billion bank holding company headquartered in Newark, Ohio. Park has two bank subsidiaries and 154 full-service offices: The Park National Bank (11 bank divisions in Ohio) Vision Bank, which has bank divisions in Florida and Alabama. Established in 1908, Th
Slide 5: Our Mission
Maximize long-term return to our shareholders by: Acting at all times with integrity and concern for the well-being of our customers, our community and our associates; Providing financial products and services of such high value that our customers view us as unique; Operating our banks so as to assu
Slide 6: Company Overview and Franchise Map
Company Overview Franchise Map Headquarters: Newark, OH Assets: $7.0 billion Loans: $4.6 billion Deposits: $5.1 billion TC Equity: $485 million TARP: $100 million Market Cap: $785 million 154 branches between two bank subsidiaries across 4 states Park National Bank 11 bank divisions in Ohio and Kent
Slide 7: A Successful History of Disciplined Strategic Growth
1908 1908 The Park National Bank is established A Successful History of Disciplined Strategic Growth (14 acquisitions; 2 De Novos) 1985 1985 Acquisition of Fairfield National Bank 1987 1987 Park National Corporation holding company is established Acquisition of Richland Trust Company 1990 1990 Acqui
Slide 8: Park Executive Management
Park Executive Management C. Daniel DeLawder - Chairman and Chief Executive Officer - Age: 59 - Chairman, Chief Executive Officer and Board Member of The Park National Bank and Park National Corporation (Corporation or Park) headquartered in Newark, Ohio. He served previously as President of The Par
Slide 9: Park Executive Management (continued)
Park Executive Management (continued) John W. Kozak - Chief Financial Officer - Age: 54 - Chief Financial Officer of Park since April 1998 (became an executive officer of Park on July 22, 2002); Senior Vice President since January 1999, Chief Financial Officer since April 1998, a Member of the Board
Slide 10: Experienced Management Team
Experienced Management Team Name Position Age Years with PRK Years In Industry C. Daniel DeLawder Chairman & CEO 59 38 38 David L. Trautman President 48 26 26 John W. Kozak Chief Financial Officer 54 29 29 Senior leadership consists of 16 executives with proven local market experience Management tea
Slide 11: Management Team - continued
Management Team - continued Name Position Age Years with PRK Years In Industry Brady T. Burt VP - Chief Accounting Officer 37 2 8 Tom Button SVP - Chief Credit Officer 49 12 23 Tom Cummiskey SVP - Trust 39 9 11 Lynn B. Fawcett SVP - Operations 50 19 19 William C. Fralick President - Security Nationa
Slide 12: Results Count - ROA and ROE History
Results Count - ROA and ROE History - PRK, excluding Vision Park ROA Peer median ROA Park ROE * Peer median ROE Q2 2009 - YTD annualized 1.76% N/A 23.16% N/A Q1 2009 annualized 1.68% 0.07% 22.63% -0.56% 2008 1.64% -0.04% 21.60% -1.80% 2007 1.52% 0.87% 17.88% 9.45% 2006 1.75% 1.11% 16.71% 12.23% 2005
Slide 13: Park National Corporation, excluding Vision - Income Statement
Park National Corporation, excluding Vision - Income Statement (in thousands) Six months ended June 30, 2009 Dec. 31, 2008 Dec. 31, 2007 Dec. 31, 2006 Net interest income $ 122,937 $ 228,808 $ 210,921 $ 213,244 Provision for loan losses 9,743 23,524 10,051 3,927 Net Interest Income after Provision 1
Slide 14: Vision Bank - Income Statement
Vision Bank - Income Statement (in thousands) Six months ended June 30, 2009 Dec. 31, 2008 Dec. 31, 2007 Dec. 31, 2006 Net interest income $ 13,290 $ 27,065 $ 23,754 N/A Provision for loan losses 18,400 46,963 19,425 N/A Net Interest Income after Provision (5,100) (19,898) 4,329 N/A Non Interest Inc
Slide 15: Park National Corporation - Income Statement
Park National Corporation - Income Statement (in thousands) Six months ended June 30, 2009 Dec. 31, 2008 Dec. 31, 2007 Dec. 31, 2006 Net interest income $ 136,227 $ 255,873 $ 234,677 $ 213,244 Provision for loan losses 28,143 70,487 29,476 3,927 Net Interest Income after Provision 108,084 185,386 20
Slide 16: Park National Corporation - Balance Sheet
Park National Corporation - Balance Sheet (in millions) June 30, 2009 Dec. 31, 2008 Dec. 31, 2007 Total Investment Securities $ 1,913.6 $ 2,059.1 $ 1,703.1 Total Loans 4,620.0 4,491.3 4,224.1 Total Assets 7,007.6 7,070.7 6,501.1 Total Deposits 5,053.4 4,761.8 4,439.2 Total Liabilities 6,342.5 6,428.
Slide 17: Funding Composition
Funding Composition Funding Mix Demand Deposits Transaction Accounts Savings Time Deposits Other East 812959 1155450 838376 2231718 4921 Deposits Senior Debt Other East 5053424 1140688 148357 PRK Peers Cost of Funds 1.23 2.04 Cost of Deposits % (as of 3/31/09) Deposit Composition 80% core deposits c
Slide 18: Park National Bank - The bank of choice
Park National Bank - The bank of choice Bank Division Name Year joined Park Our bank Total county Park % of market share Rank in market Park National 1908 $ 826,933 $ 1,733,591 47.7% 1 Fairfield National 1985 281,838 1,541,906 18.3% 1 Richland Bank 1987 419,705 1,588,862 26.4% 1 Century National 199
Slide 19: Earning Assets Composition
C & I Commercial real estate Residential real estate Real estate construction Consumer East 737748 1112361 1567300 514820 688240 Securities Loans Other East 1921798 4585406 23221 Earning Assets Composition Earning Assets by Type Loans by Type Source: SNL Financial; Company Filings Commercial lending
Slide 20: Increase / (decrease) in loans
2000 2001 2002 2003 2004 2005 2006 2007 2008 6/30/2009 Loan growth 184007 -156082 -94956 45215 171784 53600 99316 126005 351277 150673 Increase / (decrease) in loans (in thousands) Source: Company Filings through June 30, 2009. As reported on the statement of cash flows. Six year loan growth = $203,
Slide 21: Investment Portfolio
Investment Portfolio Agency Municipals Agency MBS Equity Securities Percentage 318021 31285 1505957 1395 Investment Portfolio Composition Conservative Portfolio Net unrealized gain position of $57.1 million as of June 30, 2009 No Private Label MBS No Single-Issuer or Pooled Trust Preferreds As of Ju
Slide 22: Park National Corporation, excluding Vision - Non-performing assets
Park National Corporation, excluding Vision - Non-performing assets (in thousands) June 30, 2009 Dec. 31, 2008 Dec. 31, 2007 Non-accrual loans $ 84,703 * $ 68,305 * $ 38,113 Renegotiated loans - - 2,804 Loans past due 90 days or more 4,312 4,777 4,088 Total nonperforming loans 89,015 73,082 45,005 O
Slide 23: Vision Bank - Non-performing assets
Vision Bank - Non-performing assets (in thousands) June 30, 2009 Dec. 31, 2008 Dec. 31, 2007 Non-accrual loans $ 121,730 $ 91,207 $ 63,015 Renegotiated loans 148 2,845 - Loans past due 90 days or more 105 644 457 Total nonperforming loans 121,983 94,695 63,472 Other real estate owned 35,082 19,699 7
Slide 24: Park National Corporation - Non-performing assets
Park National Corporation - Non-performing assets (in thousands) June 30, 2009 Dec. 31, 2008 Dec. 31, 2007 Non-accrual loans $ 206,433 $ 159,512 $ 101,128 Renegotiated loans 148 2,845 2,804 Loans past due 90 days or more 4,417 5,421 4,545 Total nonperforming loans 210,998 167,778 108,477 Other real
Slide 25: Credit Quality Snapshot - Total nonperforming assets
Total nonperforming assets Dec. 31, 2007 Dec. 31, 2008 6/30/2009 Park National Bank 51374 79231 95212 Vision 70546 114394 157065 Credit Quality Snapshot Source: SNL Financial; Company Filings
Slide 26: Park National Corporation - ALLL Summary
Park National Corporation - ALLL Summary (in thousands) June 30, 2009 Dec. 31, 2008 Dec. 31, 2007 Average loans $ 4,549,313 $ 4,354,520 $ 4,011,307 ALLL - beginning balance 100,088 87,102 70,500 Charge-offs 26,700 62,916 27,776 Recoveries 3,273 5,415 5,568 Provision for loan losses 28,143 70,487 29,
Slide 27: Credit Quality Snapshot - NCOs % of Average Loans
NCOs % of Average Loans 2002 2003 2004 2005 2006 2007 2008 June 30, 2009 annualized Park National Bank 0.0048 0.0043 0.0028 0.0018 0.0012 0.0039 0.0052 0.0058 Vision 0.0052 0.0569 0.0382 Source: SNL Financial; Company Filings Credit Quality Snapshot
Slide 28: Park Earnings History
Park Earnings History * Adjusted for goodwill impairment charge of $55 million in 2008 and $54 million in 2007. Including the goodwill impairment charges, Park's diluted EPS for 2008 and 2007 was $0.97 and $1.60, respectively. ** Annualized earnings through June 30, 2009 have been utilized in this c
Slide 29: Park Earnings History - Diluted EPS
Price to Tangible Book % 2000 2001 2002 2003 2004 2005 2006 2007 2008 6/30/2009 Park National Corporation 4.58 5.31 5.86 5.97 6.32 6.64 6.74 5.4 4.91 2.85 Park Earnings History Source: SNL Financial; Company Filings 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 (annualized) Park National Corpora
Slide 30: Capital Ratios
Capital Ratios Capital Ratios @ June 30, 2009 Capital Ratios @ June 30, 2009 Capital Ratios @ June 30, 2009 ($ in thousands) Leverage Ratio Tier I Risk Based Capital Risk Based Capital Park National Corporation 8.43% 11.71% 13.43% Park National Bank 5.98% 8.58% 10.74% Vision Bank 10.79% 13.61% 14.90
Slide 31: Tangible Common Equity and Shares Outstanding
Tangible Common Equity TCE Ratio Shares outstanding Q2 2009 7.01% 14,154,908 2008 6.61% 13,971,727 2007 6.85% 13,964,576 2006 9.13% 13,921,529 2005 9.12% 14,092,626 2004 9.71% 14,320,227 2003 10.56% 14,455,027 2002 11.13% 14,481,564 2001 9.83% 14,637,841 2000 10.09% 14,830,953
Slide 32: Customer Proposition Leads to Core Profitability
Customer Proposition Leads to Core Profitability Yield on Earning Assets % PRK Peers 5.81 5.19 + 62 bps Cost of Funds % PRK Peers 1.84 2.21 - - 37 bps Net Interest Margin % PRK Peers 4.26 3.38 + 88 bps Core ROAA % PRK Peers 1.23 0.07 + 116 bps Efficiency Ratio % PRK Peers 51.2 63.8 - - 1,260 bps Cor
Slide 33: Why invest in Park National Corporation?
V. Why invest in Park National Corporation? Unique, localized business model makes us the bank of choice for customers Stable, low cost deposit funding, coupled with superior lending rates, contributes to outstanding profitability Favorably positioned to take advantage of excellent growth opportunit
Slide 34: Appendix: Profiles of PRK Affiliate Banks
Appendix: Profiles of PRK Affiliate Banks
Slide 35: Ohio Bank Divisions
Ohio Bank Divisions Bank Divisions 2008 Average Assets (in millions) Park National Bank $ 1,839.0 Century National Bank 711.2 Security National Bank 670.0 First-Knox National Bank 658.2 Richland Bank 527.0 Second National Bank 423.1 PNB of Southwest Ohio & N. KY 416.4 Fairfield National Bank 337.4 U
Slide 36: Bank Division Presidents
President: David L. Trautman Age: 48 Years with Park National Bank: 26 Park National Bank first opened for business in 1908 Largest of Park's banking operations Total assets at March 31, 2009: $6,216.2 million (including all divisions of The Park National Bank) President: Thomas M. Lyall Age: 63 Mr.
Slide 37: Bank Division Presidents
President: David J. Gooch Age: 40 Mr. Gooch graduated from Miami University in 1991 with a Bachelor of Science in Business Administration with a major in finance and he graduated in 2004 from the Wisconsin Graduate School of Banking. Years with Richland Bank: 5 (12 total years with Park) Richland Ba
Slide 38: Bank Division Presidents
President: Donald R. Stone Age: 51 He has been President of United Bank since January 2001. He received his undergraduate degree from Ohio State with a Bachelors of Science in Business and a MBA from University of Toledo in 1984 and is a graduate of the Graduate School of Banking 1991, Central State
Slide 39: President: Bob Kent, Scope Aircraft Finance
President: Bob Kent Age: 51 He has spent 6 years at PRK focusing on Aircraft Lending, Finance Company Lending, Corporate Loan Committee, Vision Bank Alabama Credit Liaison. Years with Park/Scope: 6 Scope Aircraft Finance first opened for business in 1975
Slide 40: Florida Bank - Vision Bank
Florida Bank Vision Bank ("Vision Bank"), a Florida state-chartered bank with its main office in Panama City, Florida and financial service offices in Baldwin County, Alabama and in Bay, Gulf, Leon, Okaloosa, Santa Rosa and Walton Counties in the panhandle of Florida. Bank Affiliate 2008 Average Ass
Slide 41: President: Joey W. Ginn, Vision Bank
President: Joey W. Ginn Age: 50 Mr. Ginn received a B.S. in Finance and M.B.A, with concentration in Accounting, both from the University of South Alabama. He is also a graduate of the Graduate School of Banking of the South at LSU Mr. Ginn has 25 years of banking experience Years with Vision Bank:
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