Wintrust Financial Corporation · NASDAQ:WTFC
Wintrust Financial — Keefe, Bruyette & Woods 2012 Boston Bank Conference
51 slides from Wintrust Financial's conference presentation, Feb 29, 2012
Slide 1: Keefe, Bruyette & Woods 2012 Boston Bank Conference
1 Exhibit 99.2 Keefe, Bruyette & Woods 2012 Boston Bank Conference February 29, 2012
Slide 2: Forward-Looking Information
2 During the course of our remarks today, we will make certain predictive statements regarding our plans and strategies and anticipated financial effects to assist you better in understanding our company. These forward looking statements about future results are subject to risks and uncertainties. R
Slide 3: Today's Presentation
Who we are Where we have been-how we got here Where we are going Summary financial results Questions 3 Today’s Presentation Today’s Presentation Who we are Where we have been-how we got here Where we are going Summary financial results Questions
Slide 4: Slide 4
Slide 5: Who We Are
5 Nearly twenty year-old community focused banking organization with approximately $16 billion in assets Fifteen community banks with strong ties to local residents and business leaders in the Chicago and Milwaukee metropolitan markets 9 de novo charters established since 1991 15 bank acquisitions s
Slide 6: Community Banking, Specialty Finance, Wealth Management
6 Community Banking Specialty Finance Wealth Management Fifteen community banks Chicago and Milwaukee metropolitan markets 101 locations Full product suite – home equity, home mortgage, consumer, real estate and commercial loans, safe deposit facilities, ATMs, & internet banking Wintrust Mortgage Na
Slide 7: Asset Growth – Internal / Acquired
7 Asset Growth – Asset Growth – Internal / Acquired Internal / Acquired (in millions) (in millions)
Slide 8: Banking Locations
8 Banking Locations Banking Locations
Slide 9: Wintrust Banks: Recent Growth in Locations
A Leading Chicago Bank Beginning of 2010 At December 31, 2011 Wintrust Banks: Recent Growth in Locations Wintrust Banks: Recent Growth in Locations
Slide 10: Chicago and Milwaukee metropolitan markets
10 Chicago and Milwaukee metropolitan markets Initially focused on high net worth areas. Have since moved into broader market Flexibility to continue to profitably penetrate broader market Downtown Chicago focusing on corporate and commercial customers Positioned as local alternatives to the “Big Ba
Slide 11: Funding and Assets
11 Funding Assets Loan-to-deposit ratio 85% - 90% Generate ~ two-thirds of loan volume from banks Remaining loan volume from niche businesses First Insurance Funding Tricom Other (including housing associations, franchise lending, mortgage warehouse lending, indirect auto -- to name a few) Consisten
Slide 12: Deposit Market Share-Chicago MSA
12 At June 30, 2011 At June 30, 2010 In-market Deposit In-market Deposit 2011 Deposit Market Deposit Market Rank Bank Holding Company Dollars Share % Dollars Share % JP Morgan Chase & Co. ** $ 57.9 BB 19.8% $49.2 BB 17.2% Bank of Montreal ** $ 33.3 BB 11.4 % $26.7 BB 9.4% Bank of America ** $ 25.1 B
Slide 13: How We Got Here
13 How We Got Here How We Got Here
Slide 14: How We Got Here: Organic and Acquisition Growth
14 (2010-11) Organic & Acquisition Growth 7 traditional bank acquisitions since 2003 9 de novo charters since 1991 “Rope - A – Dope” Slowed growth Maintained extremely conservative underwriting Reduced relative cost of funds Controlled expenses “Off the Ropes” Life insurance premium finance acquisit
Slide 15: Compound Annual Growth Rates Through 2005
15 Compound Annual Growth Rates Through 2005 (Years ended December 31, 2005) Revenues 27.6% 26.8 25.0% 31.8% 31.4% Net Income 30.5 32.6 34.0 38.1 43.1 EPS (diluted) 17.5 17.9 19.8 21.3 27.1 Assets 27.4 31.2 30.0 31.9 31.2 Loans 19.9 25.7 26.8 26.8 27.5 Deposits 31.8 31.8 29.6 30.6 29.8 Compound Annu
Slide 16: So How Did Wintrust Fare??
16 Remained profitable throughout the cycle. We have taken advantage of the many opportunities which are always present in adverse credit cycles Dislocated people Dislocated assets Dislocated banks Key Financial Goals Increase pre-tax pre-provision adjusted earnings Move bad assets out So How Did Wi
Slide 17: Dislocated People, Assets and Banks
17 Dislocated People Dislocated Assets Dislocated Banks FIFC purchased a portfolio of domestic life insurance premium finance loans and certain related assets from indirect wholly-owned subsidiaries of AIG Aggregate balance of approximately $1.03 billion Purchase price of $746 million Resulting disc
Slide 18: FDIC-Assisted Transactions
18 Bank Date of Acquisition Number Of Branches Fair Value of Asset Acquired (in 000s) Fair Value of Loans Acquired (in 000s) Fair Value of Liabilities Acquired (in 000s) Bargain Purchase Gain Additionally, acquired Charter National Bank & Trust on February 10, 2012 in an FDIC-assisted transaction wi
Slide 19: Consolidated Net Income
19 Consolidated Net Income Consolidated Net Income (before Preferred Dividends, in 000s) (before Preferred Dividends, in 000s)
Slide 20: Annual Pre-tax Adjusted Earnings
20 (in 000s) (* - Annualized) “Pre-tax Adjusted Earnings” are calculated by removing from reported Pre-tax earnings the following categories: Provision for Credit Losses; OREO Related Costs; Mortgage Recourse Obligations on Loans Previously Sold; Covered Loan Expense; Mortgage Servicing Rights Fair
Slide 21: Loan Growth
21 (in millions) Loan pipelines remain good LOAN GROWTH LOAN GROWTH (excluding Loans Held for Sale) (excluding Loans Held for Sale)
Slide 22: Non-Performing Asset Ratio: Wintrust vs. Peer Group
22 Peer Group Data is per the Federal Reserve’s Bank Holding Company Performance Report Non-Performing Asset Ratio Non-Performing Asset Ratio Wintrust vs. Peer Group Wintrust vs. Peer Group
Slide 23: Net Charge-offs Ratio: Wintrust vs. Peer Group
23 Peer Group Data is per the Federal Reserve’s Bank Holding Company Performance Report Net Charge-offs Ratio Net Charge-offs Ratio Wintrust vs. Peer Group Wintrust vs. Peer Group
Slide 24: Capital Summary
24 Enhance and maintain strong capital ratios 12/31/09 12/31/10 12/30/11 Tier 1 Risk-based capital 11.0% 12.5% 11.8% Total capital ratio 12.4% 13.8% 13.0% Leverage ratio 9.3% 10.1% 9.4% Tangible common equity ratio 4.7% 8.0% 7.5% Provide flexibility for growth Organic growth & lending opportunities
Slide 25: Tangible Book Value Per Share Through Cycles
$26.66* * Proforma assuming tangible equity units convert at a maximum price of $37.50 Financial Overview – Financial Overview – Wintrust Has Consistently Grown Wintrust Has Consistently Grown Tangible Book Value Per Share Through Cycles Tangible Book Value Per Share Through Cycles Tangible Common B
Slide 26: Financial Overview – Capital Components
26 - Common Shareholders Equity - Trust Preferred Securities - Subordinated Debt - Preferred Securities Financial Overview – Financial Overview – Capital Components Capital Components (in millions) (in millions)
Slide 27: Wintrust Strategy for 2012 and Beyond
Back to the Future 27 Wintrust Strategy for 2012 Wintrust Strategy for 2012 and Beyond and Beyond Back to the Future
Slide 28: Back to the Future: Strategy for 2012 and Beyond
28 This cycle isn’t over yet so we need to proceed cautiously in all of our endeavors Continue to increase core earnings Continue to expeditiously remove problem assets from the balance sheet Plan is to return to the growth mode experienced in the first 15 years of our existence with an overriding e
Slide 29: Expected Pre-tax Adjusted Earnings Improvements
“Pre-tax adjusted earnings” annualized run rate $229 million run rate in the 4 th Quarter of 2010 $243 million run rate in the 4 th Quarter of 2011 Subject to market and other conditions, including interest Continued deposit re-pricing Organic growth Income from additional acquisitions 29 rate envir
Slide 30: Organic Growth and Branding
Organic Growth-going back to pre Rope-A-Dope model Expect each bank to grow $75 million per year Expect each bank to open a branch every two years The Wintrust Brand By design becoming more prevalent and recognized over the last two years Wintrust Wealth Management, Wintrust Mortgage Co., Wintrust C
Slide 31: Acquisition Strategy
31 Penetrate new markets with community banking model Within 1½ hours of Wintrust headquarters Acquired entities with existing management that wish to continue to grow Acquisitions in specialty finance and wealth management Must complement existing franchise, be a strategic new business line, or add
Slide 32: Growth Strategy – Market Conditions
Our opinion is that about half of the customers in the market prefer a local community oriented bank while the other half prefer a large banking organization. We believe our structure (multiple charters with locally engaged management and the resources of a larger institution) will allow us to take
Slide 33: Why Invest in Wintrust?
Managing well through the cycle-consistently profitable with strong core earnings growth Asset quality position is manageable and better than peer group and should allow us to be first out of this cycle Strong capital position-NO TARP overhang Enviable core deposit franchise in market area Different
Slide 34: 34
34
Slide 35: Supplemental Financial Data
Supplemental Financial Supplemental Financial Data Data
Slide 36: Total Assets
36 Total Assets Total Assets (in millions)
Slide 37: Historical Growth
37 Historical Growth Historical Growth
Slide 38: Asset Growth of Banks by Year
38 Asset Growth of Banks by Year Asset Growth of Banks by Year (in millions)
Slide 39: Net Interest Margin
39 Net Interest Margin Net Interest Margin (fully taxable equivalent) (fully taxable equivalent)
Slide 40: Revenue Growth by Quarter
40 - Net interest income - Non-interest income (in 000s) Revenue Growth by Quarter Revenue Growth by Quarter (excluding Bargain Purchase Gains recorded in 3Q09 through 4Q11) (excluding Bargain Purchase Gains recorded in 3Q09 through 4Q11)
Slide 41: EPS Growth
41 4 th Quarter and full year 2010 amounts exclude $(0.33) and $(0.36) per diluted common share as a result of the deemed preferred stock dividend resulting from the repurchase of the TARP-CPP preferred stock. EPS Growth EPS Growth Annual Quarterly
Slide 42: Net Overhead Ratio & Efficiency Ratio
42 Net Overhead Ratio & Efficiency Ratio Net Overhead Ratio & Efficiency Ratio
Slide 43: Diversified Loan Portfolio
43 Diversified Loan Portfolio Diversified Loan Portfolio Composition as of December 31, 2011 - Composition as of December 31, 2011 - $11.2 Billion $11.2 Billion (excludes loans held for sale) (excludes loans held for sale) Commercial and Industrial Premium Finance – Life Insurance Res. R/E Home Equi
Slide 44: Ending Loan-to-Deposit/Secured Borrowing Ratio
44 *Includes $600 million of secured borrowing related to the commercial premium finance loan securitization for which the related loans are recorded on the balance sheet beginning in 2010. Ending Loan-to-Deposit/Secured Ending Loan-to-Deposit/Secured Borrowing Ratio* Borrowing Ratio* (excludes loan
Slide 45: Non-Performing Assets to Total Assets
45 Peer Group Data is per the Federal Reserve’s Bank Holding Company Performance Report Non-Performing Assets to Total Assets Non-Performing Assets to Total Assets (NPAs include NPLs and OREO and exclude covered loans) (NPAs include NPLs and OREO and exclude covered loans) Assets in millions Peer Gr
Slide 46: Net Charge-offs to Total Average Loans
46 0.31% Peer Group Data is per the Federal Reserve’s Bank Holding Company Performance Report Net Charge-offs to Total Average Loans Net Charge-offs to Total Average Loans Loans In millions Peer Group-2003 = 0.33% Peer Group-2004 = 0.21% Peer Group-2005 = 0.18% Peer Group-2006 = 0.15% Peer Group-200
Slide 47: Forward-Looking Statements
This document contains forward-looking statements within the meaning of federal securities laws. Forward-looking information can be identified through the use of words such as “intend,” “plan,” “project,” “expect,” “anticipate,” “believe,” “estimate,” “contemplate,” “possible,” “point,” “will,” “may
Slide 48: Forward-Looking Statements (cont.)
48 • negative economic conditions that adversely affect the economy, housing prices, the job market and other factors that may affect the Company’s liquidity and the performance of its loan portfolios, particularly in the markets in which it operates; • the extent of defaults and losses on the Compa
Slide 49: Forward-Looking Statements (cont.)
49 • competitive pressures in the financial services business which may affect the pricing of the Company’s loan and deposit products as well as its services (including wealth management services); • delinquencies or fraud with respect to the Company’s premium finance business; • failure to identify
Slide 50: Forward-Looking Statements (cont.)
50 Therefore, there can be no assurances that future actual results will correspond to these forward-looking statements. The reader is cautioned not to place undue reliance on any forward-looking statement made by or on behalf of Wintrust. Any such statement speaks only as of the date the statement
Slide 51: Questions
51 Questions Questions
Wintrust Financial — Keefe, Bruyette & Woods 2012 Boston Bank Conference on 6ix