Fifth Third Bancorp · NASDAQ:FITB
Fifth Third Bancorp — 2005 Smith Barney Citigroup Financial Services Conference
34 slides from Fifth Third Bancorp's conference presentation, Jan 26, 2005
Slide 1: Positioning for Better Performance
Exhibit 99.1 January 26, 2005 2005 Smith Barney Citigroup Financial Services Conference “Positioning for Better Performance” Kevin T. Kabat Executive Vice President Neal E. Arnold Executive Vice President
Slide 2: Affiliate Banking
I. Affiliate Operating Model II. Markets III. Deposit Performance IV. Loan Performance Affiliate Banking
Slide 3: Affiliate Bank Operating Model
Affiliate Bank Operating Model FITB Affiliates State Deposits % of 5/3 Assets Bkg Ctrs President Years @ 5/3 Cincinnati OH $12.4 20% $25.2 107 G. Schaefer, Jr. 34 Chicago IL 8.8 14% 9.9 129 T. Zink 1 Western Michigan MI 6.8 11% 9.8 135 M. VanDyke 4 Florida* FL 5.0 8% 6.8 93 K. Hale 1 Detroit MI 3.6
Slide 4: Customer & Community Relationships
Customer & Community Relationships A Balanced Business Model for Success Strong Commitment to Affiliate Model Best Employees
Slide 5: Metropolitan Market Focus
Metropolitan Market Focus Distribution, Convenience & Price Are Competitive Advantages in Metro Markets Fifth Third MSA Markets MSA Population Rank Deposits Share % Chicago, IL 9.4 5 $ 7,139 3.2 Detroit, MI 4.5 7 2,817 3.7 Tampa, FL 2.6 10 786 3.5 Cleveland-Lorain, OH 2.1 6 2,585 4.2 Cincinnati, OH-
Slide 6: Improving Deposit Performance
Improving Deposit Performance 2004 average transaction deposit growth of 7% compared to 13% in the prior year 50,000 45,000 40,000 Millions 35,000 $ 30,000 25,000 2001 Q4-03 Q1-04 Q2-04 Q3-04 Q4-04 26,363 41,851 41,397 71% 42,287 15%* 43,861 Average Transaction Deposits 12%* 45,126 * Annualized grow
Slide 7: Demonstrated Long-Term Track Record
1999 2000 2001 2002 2003 2004 Demonstrated Long-Term Track Record 35,000 30,000 $ Millions 25,000 20,000 15,000 10,000 1999 2000 2001 2002 2003 2004 Avg Demand & NOW 5-year CAGR Interest Checking 18% Demand Deposits 15% Loans & Leases 8% Earning Assets 9% 90,000 80,000 70,000 $ Millions 60,000 50,00
Slide 8: Affiliate Loan Performance
2000 2001 2002 2003 Affiliate Loan Performance 40% 35% 30% 25% 20% 15% 10% 5% 0% 2004 Average Total Loan & Lease Growth Florida Nashville Lexington OH Valley Chicago Cleveland Indianapolis Detroit Columbus Nine affiliates grew loans by more than 10% in 2004 9% growth in average loans & leases in 200
Slide 9: Retail Banking
I. Retail Deposit Strategy II. Initiatives III. Small Business IV. The Opportunity Retail Banking “Positioned for Better Performance in 2005…”
Slide 10: 2005 Retail Deposit Strategy
1% 2005 Retail Deposit Strategy Competitive Rates = Growth & Retention Distribution of Consumer Deposit Balances 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% % of customers RATE-DRIVEN $35,000+ in deposits MIDDLE MARKET $1,000—$34,999 in deposits LOW BALANCE < $1,000 in deposits % of balances 100% 90
Slide 11: Driving Deposit Growth
Right price Right product Driving Deposit Growth Consumer deposits—Targeting 10% plus growth in 2005 Small business deposits—Targeting 50% growth in 2005 Initiatives Quarterly deposit campaigns De-novo banking center expansion Increased retention and service focus Segmentation focus
Slide 12: Substantial Small Business Growth Opportunity
2004 growth rate of 10% vs. 2005 plan of 20% Leverage technology to automate underwriting and processing Substantial Small Business Growth Opportunity Commercial Loan Performance 6,000 5,000 4,000 3,000 2,000 1,000 Fla Lex 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0% 5/3 M arket Penetration 9
Slide 13: Substantial Small Business Growth Opportunity
Increasing market share to 15% in all MSA’s would represent growth in the deposit base of 75% Substantial Small Business Growth Opportunity Small Business Checking Performance 13 of 17 affiliates have less than 15% small business deposit market share 11 of 17 markets have less than 15% small busines
Slide 14: De-Novo Banking Center Expansion
I. De-Novo Banking Center Additions II. Performance Contribution De-Novo Banking Center Expansion
Slide 15: Midwest De-novo Expansion Strategy
Midwest De-novo Expansion Strategy Investing In a Retail Franchise New Banking Centers 35 30 25 20 15 10 5 0 Chicago Detroit W. Mich Cleveland Indianapolis Cincinnati Florida Columbus Tennessee Ohio Valley Lexington Louisville N. KY Toledo S. Indiana Dayton N. Mich 11 10 9 9 6 6 6 4 4 4 4 4 3 3 2 13
Slide 16: De-Novo Banking Center Expansion
Total Same Mix New Mix Banking Ctrs Store Sales % Store Sales % Net Income Growth $53,675,000 $50,652,000 94% $ 3,022,000 6% Loan Growth $1,820,266,000 $1,548,000,000 85% $272,040,000 15% Deposit Growth $814,136,000 $158,601,000 19% $655,535,000 81% De-Novo Banking Center Expansion Driving Deposit,
Slide 17: The Deposit Opportunity
0% 5% 10% 15% 20% The Deposit Opportunity Fifth Third has only an 8% market share in the core six-state footprint Fifth Third has a 7% market share on a combined basis in MSA’s greater than 1 million in population FITB State Market Share Ohio Michigan Kentucky Indiana Illinois Florida 6 State Total
Slide 18: Business Lines
Business Lines 2004 Revenues Processing Solutions 11% Investment Advisors 10% Commercial 28% Retail 51% Processing revenues exclude gain-on-sale
Slide 19: Commercial Banking
Commercial Banking “Hitting on All Cylinders…” I. Revenue & Net Income Performance II. Deposit Performance III. Service Revenues IV. Loan Performance V. Credit Performance
Slide 20: Commercial Banking Performance
1,000 1,100 1,200 1,300 1,400 1,500 1,600 1,700 2002 2003 2004 $ Millions $ Millions Revenue Net Income 11% revenue growth & 15% net income growth in 2004 Sales force additions still gaining momentum Superior loan growth through recent cycle will continue to drive results Commercial Banking Performa
Slide 21: Commercial Deposit Focused
2000 2001 2002 2003 2004 Commercial Deposit Focused 60% 50% 40% 30% 20% 10% 0% 2004 Average Commercial Demand Deposit Growth Florida Cleveland Cincinnati Chicago Columbus Nashville Indianapolis S IN Detroit Lexington Dayton 11 affiliates grew commercial demand deposits by 20% or more 9,000 8,000 7,0
Slide 22: Commercial Service Revenues
Commercial Service Revenues Inst. Sales & Pub Fin 10% International 24% Loan & Lease 9% Corporate Fin 6% Deposit Revenue 38% Other 13% Deposit-based revenues now make up 38% of service revenues compared to 33% in 2002 Total commercial service revenues have increased by 25% since 2002 Selected Growth
Slide 23: Superior Commercial Loan Growth
Period end commercial loans & leases up 14% over last year 5-year CAGR = 10% Superior Commercial Loan Growth 2004 Average Commercial Loan & Lease Growth 30% 25% 20% 15% 10% 5% 0% Florida Lexington OH Valley Indianapolis Chicago Nashville Louisville Detroit N. Mich. Toledo 30,000 25,000 20,000 15,000
Slide 24: People Make the Difference
People Make the Difference… In a period of declining commercial and industrial loan demand: Fifth Third increased C&I balances by 49% since Dec 2001 Over 250 commercial sales people hired during this time frame, an increase in excess of 30% 580 560 540 520 ‘s in Billions 500 $ 480 Industry 460 440 4
Slide 25: Superior Credit Culture
Superior Credit Culture Favorable Industry Comparison with Few Large Credits NPAs / Loans & OREO 1.4 1.2 1 Percent 0.8 0.6 0.57 0.4 0.2 1Q02 2Q02 3Q02 4Q02 1Q03 2Q03 3Q03 4Q03 1Q04 2Q04 3Q04 4Q04 Fifth Third Top 25 Bank Average 1.17 1.25 1.29 1.25 1.22 1.15 1.07 0.94 0.75 0.63 0.64 0.62 0.53 0.56 0.
Slide 26: Fifth Third Processing Solutions
I. Business Mix II. Revenue History III. 2005 Initiatives Fifth Third Processing Solutions “A Growth Story…”
Slide 27: Total FTPS Revenue Mix
Total FTPS Revenue Mix FTPS Revenue 2002 2003 2004 Financial Institution $206 $216 $250 Merchant Services 261 306 305* Card Services 76 87 102 TOTAL $543 $609 $657 Card Services 16% 46% 38% Merchant Services Financial Institution * Includes 2004 impact of sold contacts totaling $70 million in compar
Slide 28: FTPS Revenue History
* Includes 2004 impact of sold contacts totaling $70 million in comparable lost annual revenue FTPS Revenue History Compound Annual Growth Rate 5-year = 26% 750 650 550 $ Millions 350 250 150 50 657* 1999 2000 2001 2002 2003 2004 Fin. Inst. & Card Merchant
Slide 29: 2005 Initiatives
2005 Initiatives Cross-sell Merchant Card Processing into existing Commercial & Small Business Customers 2 X revenue and 4 X net income opportunity 33% increase in middle market sales representatives in 2005 80% increase in Retail Telesales representatives in 2005 Improve per sales rep production fr
Slide 30: Investment Advisors
I. Business Mix & Accomplishments II. Revenue and Net Income Performance III. 2005 Initiatives Investment Advisors “Refocused, Realigned and Positioned for Growth”
Slide 31: Fifth Third Investment Advisors
Fifth Third Investment Advisors 2004 Revenues Asset Mgmt 4% Retail Brokerage 16% Institutional 16% Private Client 64% 2004 Accomplishments 15% revenue growth compared to 4% expense growth 10 affiliates with greater than 50% net income growth
Slide 32: Turning the Corner
Turning the Corner… Investment Advisors Performance 600 500 400 300 200 Revenue Net Income 100 Millions $ 50 $ Millions 2002 2003 2004 15% revenue growth & 49% net income growth in 2004 Sales force and product set largely in place Incentives aligned with performance Enhanced profitability
Slide 33: 2005 Initiatives
5,185 existing commercial clients without a 401K plan relationship 2005 Initiatives Expand sales of investment management nationally through Fifth Third Asset Management (FTAM) Taft-Hartley, Corporate and Public pension client focus $40 billion investment assets by 2008 Penetrate commercial and smal
Slide 34: Forward-looking statements
This presentation may contain forward-looking statements about Fifth Third Bancorp and/or the company as combined with acquired entities within the meaning of Sections 27A of the Securities Act of 1933, as amended, and Rule 175 promulgated thereunder, and 21E of the Securities Exchange Act of 1934,
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