F.N.B. Corporation · NYSE:FNB
F.N.B — RBC Financial Institutions Conference 2015
42 slides from F.N.B's conference presentation, Mar 10, 2015
Slide 1: F.N.B. Corporation Investor Presentation
F.N.B. Corporation Investor Presentation RBC Financial Institutions Conference – New York, NY March 10, 2015
Slide 2: Cautionary Statement Regarding Forward-Looking Information and Non-GAAP Financial Information
Cautionary Statement Regarding Forward-Looking Information and Non-GAAP Financial Information The presentation includes “snapshot” information about F.N.B. Corporation used by and of illustration and is not intended as a full business or financial review and should be viewed in the context of all th
Slide 3: F.N.B. Corporation
F.N.B. Corporation About F.N.B. Corporation Experienced Leadership Team Favorably Positioned for Long-Term Success Strong Operating Trends 3
Slide 4: About F.N.B. Corporation
About F.N.B. Corporation • Headquarters: Pittsburgh, PA • Assets: $16.1 billion High-Quality, • Loans: $11.2 billion Growing Regional Financial Institution • Deposits: $12.3 billion • Banking locations: 289 • Market Capitalization: $2.2 billion(2) • Attractive and expanding footprint: PA/OH/MD/WV: B
Slide 5: Experienced Leadership Team
Experienced Leadership Team Experienced and respected executive management team has guided FNB through the cycle, and positioned the Company for long-term, sustained growth Years of Banking Experience Joined FNB Prior Experience President and CEO Vincent J. Delie, Jr. 28 2005 National City President
Slide 6: Reposition and Reinvest – Actions
Reposition and Reinvest – Actions 2009 2010 2011 2012 2013 2014 PEOPLE Talent Management Chief Technology Strengthened team through and Chief Marketing Attract, retain, develop best talent key hires; Continuous team Officer Positions development Filled Geographic Segmentation Regional Created 5th &
Slide 7: Full Year Financial Highlights – Annual Trends
Full Year Financial Highlights – Annual Trends 2014 2013 2012 2011 2010 Net income available to common shareholders ($ Quality millions) $135.6 $123.5 $117.8 $90.3 $68.2 Operating Earnings(1) Earnings per diluted common share $0.80 $0.84 $0.84 $0.72 $0.60 ROTCE(1) 14.72% 17.35% 18.75% 16.32% 14.71%
Slide 8: Full Year 2014 Highlights
Full Year 2014 Highlights Record net income(1) $135.6 million Operating earnings per share reflects fully absorbed regulatory impacts Operating earnings per common share(1) $0.80 Adjusted earnings per common share: Adjusted for Basel III-related capital raise and Durbin- $0.90 related revenue lo
Slide 9: Full Year 2014 Highlights (continued)
Full Year 2014 Highlights (continued) Consistent high-quality Continued very good asset quality results underwriting standards applied footprint-wide Continued strong returns on tangible common equity; Operating at higher capital levels ROTCE(1) of 14.7% Continued to execute Completed two acqu
Slide 10: Consistent Loan and Transaction Deposit Growth
Consistent Loan and Transaction Deposit Growth Consistent Growth in Loans and Transaction Deposits Loan Growth Transaction Deposit and Customer Repo Growth (Spot Balances, In Billions) (Spot Balances, In Billions) CAGR 4Q09 – 4Q14 CAGR 4Q09 – 4Q14 Total 14.0% Total 15.4% Organic(1) 7.8% Organic(1) 9
Slide 11: Transaction Deposit Growth - Strengthened Funding Mix
Transaction Deposit Growth - Strengthened Funding Mix Consistent Transaction Deposit Growth Results in Strengthened Deposit Mix Total Transaction Deposits and Customer Repos Mix 26% 24% 21% 29% 27% 79% 74% 76% 71% 73% 12/31/2010 12/31/2011 12/31/2012 12/31/2013 12/31/2014 Transaction Deposits and Cu
Slide 12: Efficiency Ratio Trends
Efficiency Ratio Trends Efficiency Ratio Trends FNB Efficiency Ratio Relative to Peers FNB’s efficiency ratio continues to trend favorably relative to peers Upper quartile results 4Q14 marks 11th consecutive quarter with an efficiency ratio under 60% 65% 64% 63% 62% 60% 61% 60% 59% 58% 57% FNB
Slide 13: Full Year Net Interest Margin Trends
Full Year Net Interest Margin Trends Net Interest Margin Trends(1) 3.77% 3.79% 3.73% 3.65% 3.59% 3.56% 3.50% 3.43% 3.38% 3.31% FNB Peer Median 2010 2011 2012 2013 2014 FNB % Ranking 2010 2011 2012 2013 2014 Relative to 71st 71st 71st 79th 79th Peers(1) (1) Reported results (2) Percentile ranking rel
Slide 14: Consistent Asset Quality – Continued High-Quality Earnings
Consistent Asset Quality – Continued High-Quality Earnings FNB Continues to Deliver High-Quality Earnings Provision for Loan Losses as % of Net Charge-Offs ($) Allowance for Loan Losses/Total Loans (%)(1) FNB provision for loan losses exceeds net charge-offs to FNB allowance for loan losses to total
Slide 15: Market Position
Market Position Strong Market Position Acquisition-Related Expansion Enhances Organic Growth Opportunities 15
Slide 16: FNB Banking Footprint
FNB Banking Footprint FNB Recent Acquisition Summary FNB Deposit Market MSA MSA Share Population 2.4 Million Pittsburgh #3 (#22 MSA) Cleveland MSA PVSA - Closed 1Q12 2.7 Million Baltimore #8 (#20 MSA) ANNB - Closed 2Q13 Pittsburgh MSA BCSB - Closed 1Q14 OBAF – Closed 3Q14 FNB Headquarters 2.
Slide 17: MSA Market Share - Proven Success, Opportunity For Growth
MSA Market Share - Proven Success, Opportunity For Growth Established MSA Markets – Proven Success, Leading Share Position Achieved Pittsburgh, PA MSA All Other Established MSAs Total Deposits Market Total Deposits Market Rank Institution 2014 ($000) Share (%) Rank Institution 2014 ($000) Share 1 PN
Slide 18: FNB Metropolitan Market Expansion Strategy
FNB Metropolitan Market Expansion Strategy - Significantly Enhanced Market Position, Geographic and Prospect Diversity Total Businesses Population (millions) 202,885 8.2 91,496 3.7 59,240 2.4 4.7 52,149 2.1 85,351 Pittsburgh Cleveland FNB MD FNB Metro Other FNB Pittsburgh Cleveland FNB MD FNB Metro
Slide 19: Disciplined Acquisition Strategy – Platform for Organic Growth
Disciplined Acquisition Strategy – Platform for Organic Growth Disciplined and Consistent Acquisition Strategy Strategy Disciplined identification and focus on markets that offer potential to leverage core competencies and growth opportunities Criteria Create shareholder value Meet strateg
Slide 20: Operating Results
Operating Results 4Q14 Highlights and Trends 20
Slide 21: 4Q14 Operating Highlights
4Q14 Operating Highlights Continued High-Quality Earnings and Positive Trends (All comparisons refer to the third quarter of 2014, except as noted) Record operating(1) net income available to common shareholders of $36.4 million; earnings per diluted common share of $0.21 Continued revenue growt
Slide 22: 4Q14 Financial Highlights – Quarterly Trends
4Q14 Financial Highlights – Quarterly Trends Current Prior Prior Year Quarter Quarter Quarter 4Q14 3Q14 4Q13 Net income ($ millions) $38.4 $37.0 $32.5 Operating Earnings(1) Net income available to common shareholders ($ millions) $36.4 $35.0 $32.5 Earnings per diluted common share $0.21 $0.21 $0.21
Slide 23: Balance Sheet Highlights – Quarterly Averages
Balance Sheet Highlights – Quarterly Averages Reported Organic 4Q14 Growth(1) Growth(1) Average Balances, $ in Millions Balance $ $ % 4Q14 Highlights Continued high-quality balance sheet Securities $2,936 $139.2 - - growth, including strong organic growth Average, organic growth results: Total l
Slide 24: Net Interest Income and Net Interest Margin
Net Interest Income and Net Interest Margin Net Interest Income Trends(1) Net Interest Income / $473,196 Net Interest Margin $403,011 Fourth quarter 2014 net interest income $122,409 $125,357 grew $2.9 million, or 2.4%, reflecting $115,883 $108,650 $109,547 average earning asset growth of $690 mil
Slide 25: Asset Quality Results
Asset Quality Results(1) $ in Thousands 4Q14 3Q14 4Q13 4Q14 Highlights Continued good asset quality results and positive trends NPL’s+OREO/Total loans+OREO 1.13% 1.25% 1.44% NPL’s+OREO/Total loans +OREO improved 12 basis points Total delinquency 0.99% 1.06% 1.28% Total delinquency improved 7 b
Slide 26: Asset Quality Trends
Asset Quality Trends NPL’s+OREO/ NCO’s Originated Loans/ Total Originated Loans+OREO(1)(2) Total Originated Loans(1)(3) 4.00% 1.40% 3.50% 1.20% 3.00% 2.74% 1.00% 2.50% 2.15% 0.80% 2.00% 0.77% 1.60% 1.44% 0.60% 1.50% 0.62% 1.13% 0.40% 1.00% 0.41% 0.50% 0.20% 0.28% 0.24% 0.00% 0.00% 2010 2011 2012 201
Slide 27: Investment Thesis
Investment Thesis Long-Term Investment Thesis 27
Slide 28: Long-Term Investment Thesis
Long-Term Investment Thesis FNB’s long-term investment thesis reflects a commitment to efficient capital management and creating value for our shareholders Long-Term Investment Thesis: Targeted Annual Total Return for Shareholders of 9-12% Thesis Centered on a Balanced Combination of Capital Managem
Slide 29: Capital Ratios and Tangible Book Value
Capital Ratios and Tangible Book Value Capital Ratios Tangible Book Value Per Share 12.5%12.3% 12.4% $5.91 $5.99 9.6% 9.6% 9.3% 8.8% 8.7% $5.38 8.4% 6.7% 6.9% 6.8% Total Risk-Based Tier One Common Leverage Tangible Common Tangible Book Value Per Share Equity December 31, 2013 September 30, 2014 Dece
Slide 30: Return on Average Tangible Common Equity Trends (ROATCE)
Return on Average Tangible Common Equity Trends (ROATCE) ROATCE Trends(1) 2014 = First full year impact of 4Q13 capital actions taken to position FNB for Basel III 18.75% 17.35% 16.32% 14.71% 14.72% 11.07% 11.21% 11.03% 10.45% FNB 5.09% Peer Median 2010 2011 2012 2013 2014 FNB % Ranking 2010 2011 20
Slide 31: High-Quality, Consistent Operating Results
High-Quality, Consistent Operating Results FNB’s ability to deliver consistent operating results exceeds peer results FNB and Peer Volatility (Standard Deviation 1Q10 – 4Q14) ROAA Volatility Revenue/Avg Assets Volatility 0.25% 0.070% 0.060% 0.20% 0.050% 0.15% 0.040% 0.10% 0.030% 0.020% 0.05% 0.010%
Slide 32: Dividend Yield Trends Relative to Peers
Dividend Yield Trends Relative to Peers Dividend Yield as of Respective Period-End(1) 4.89% 4.52% 4.24% 3.80% 3.60% 2.47% 2.30% 2.05% 2.00% FNB 0.85% Peer Median 2010 2011 2012 2013 2014 FNB % 2010 2011 2012 2013 2014 Ranking(2) 93rd 86th 93rd 93rd 86th (1) Represents annualized dividend yield based
Slide 33: Supplemental Information
Supplemental Information 33
Slide 34: Supplemental Information Index
Supplemental Information Index Diversified Loan Portfolio Deposits and Customer Repurchase Agreements Investment Portfolio Loan Risk Profile Regency Finance Company Profile Regional Peer Group Listing GAAP to Non-GAAP Reconciliation 34
Slide 35: Diversified Loan Portfolio
Diversified Loan Portfolio 12/31/2014 CAGR % of Portfolio ($ in millions) 12/31/08- $11.2 Billion Loan Portfolio Balance 12/31/14 12/31/08 12/31/14 December 31, 2014 C&I $2,318 16.1% 16% 21% Other 2% Regency 2% Indirect 7% Florida 0% CRE: Non-Owner Occupied 2,209 15.4% 16% 19% Commercial Residential
Slide 36: Deposits and Customer Repurchase Agreements
Deposits and Customer Repurchase Agreements 12/31/2014 CAGR Mix % $12.3 Billion Deposits and ($ in millions) 12/31/08- Customer Repo Agreements Balance 12/31/14 12/31/08 12/31/14 December 31, 2014 Savings, NOW, MMDA $5,829 12.9% 44% 48% Non-Interest Time Deposits 2,611 2.0% 36% 21% Bearing 22% Non-I
Slide 37: Investment Portfolio
Investment Portfolio % Ratings Highly Rated $3.1 Billion Investment Portfolio ($ in millions(1)) Portfolio Investment % December 31, 2014 Agency MBS $1,231 40% AAA 100% Ratings Composition CMO Agency 1,075 35% AAA 100% Agency Senior Notes 439 14% AAA 100% AAA 3% AA 72% Municipals 163 5% A 24% Availa
Slide 38: Loan Risk Profile
Loan Risk Profile Balance YTD Net Charge- Total Past (1) $ in millions 12/31/2014 % of Loans NPL's/Loans Offs/Loans(1) Due/Loans(1) Commercial and Industrial $2,318 20.6% 0.40% 0.09% 0.49% CRE: Non-Owner Occupied 2,209 19.6% 0.33% 0.06% 0.62% CRE: Owner Occupied 1,586 14.1% 1.40% 0.24% 1.62% Home Eq
Slide 39: Regency Finance Company Profile
Regency Finance Company Profile Consumer finance business with over 80 years of consumer lending experience Credit quality: Full Year 2014 net charge-offs to average loans of 3.93% Returns: Full Year 2014: ROA 4.05%, ROE 41.53%, ROTE 46.19% Regency Finance Company $181 Million Loan Portfolio P
Slide 40: Regional Peer Group Listing
Regional Peer Group Listing Ticker Institution Ticker Institution ASB Associated Bancorp ONB Old National Bancorp AF Astoria Financial Corporation PVTB Private Bancorp, Inc. CBSH Commerce Bancshares, Inc. SUSQ Susquehanna Bancshares, Inc. FMER First Merit Corp. UMBF UMB Financial Corp. FULT Fulton F
Slide 41: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation Operating Return on Average Tangible Common Equity Operating Return on Average Tangible Assets For the Quarter Ended Year Ended December 31, December 31, 2014 September 30, 2014 December 31, 2013 2014 2013 2012 2011 2010 Operating net income Net income available to co
Slide 42: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation Total Operating Revenue For the Quarter Ended For the Year Ended December 31, 2014 September 30, 2014 December 31, 2013 December 31, 2014 December 31, 2013 Total Revenue Net Interest Income (FTE) $ 125,357 $ 122,409 $ 108,650 $ 473,197 $ 403,012 Non-Interest Income 39