Fulton Financial Corporation · NASDAQ:FULT
Fulton Financial — Investor Presentation (October 2009)
58 slides from Fulton Financial's investor presentation, Oct 27, 2009
Slide 1: Fulton Financial Corporation Corporate Presentation
Fulton Financial Corporation ------------------------------------------------- October 2009 Corporate Presentation Data as of September 30, 2009
Slide 2: Forward-Looking Statement
Forward-Looking Statement The following presentation may contain forward-looking statements about Fulton Financial Corporation’s financial condition, business, strategies, products and services. Forward-looking statements are encouraged by the Private Securities Litigation Reform Act of 1995. Such f
Slide 3: Presentation Outline
Presentation Outline Corporate Overview Franchise and Markets Customer Experience / Satisfaction Capital Credit Third Quarter Performance Summary
Slide 4: Fulton Financial Profile
Fulton Financial Profile Mid-Atlantic regional financial holding company A family of 8 community banks in 5 states Fulton Financial Advisors Fulton Mortgage Company 270 community banking offices Asset size: $ 16.5 billion 3850 Team Members Market capitalization: $ 1.4 billion Book value per common s
Slide 5: A Valuable Geographic Franchise
A Valuable Geographic Franchise
Slide 6: Serving PA's Strongest Markets
Serving PA’s Strongest Markets* *Source: SNL, Median HH Income, 2009 data County Rank Branches Projected Population Change 2009-2014 (%) Median HH Income 2009 ($) Projected HH Income Change 2009-2014 (%) Chester, PA 6.64 87,308 7.36 Montgomery, PA 1.85 80,212 5.01 Bucks, PA 2.22 79,444 4.95 Delaware
Slide 7: FFC Affiliates in Affluent Markets
FFC Affiliates in Affluent Markets* *Source: SNL Financial, 2009 County # FFC Branches National Ranking Ranking in State Median HH Income Hunterdon, NJ #3 #1 $110,147 Fairfax, VA #4 #1 $109,067 Morris, NJ #6 #2 $104,797 Somerset, NJ #8 #3 $102,357 Howard, MD #9 #1 $101,954
Slide 8: Unemployment Rates
Unemployment Rates* FFC Counties Unemployment Rate (%)** State Unemployment Rate (%)*** United States 9.8 9.8 Delaware 7.7 8.2 Maryland 7.6 7.1 New Jersey 9.3 9.6 Pennsylvania 8.2 8.3 Virginia 6.8 6.6 *FFC Averages are an average of the unemployment rates of the counties in which FFC has branches. *
Slide 9: US Home Price Index
US Home Price Index* *Source: Freddie Mac, Q2 2009 Data Metropolitan Statistical Area Annual Change Q2 2008 - Q2 2009 # Branches United States -4.2 Average FFC Regions -5.5 Harrisburg-Carlisle, PA -1.4 Lebanon, PA -0.9 York-Hanover, PA -4.0 Lancaster, PA -1.6 Philadelphia, PA -3.3 Reading, PA -3.6 A
Slide 10: Our Brand
Our Brand COMMUNITY BANKING SMALL BUSINESS HIGH NET WORTH RETAIL BANKING LISTENING IS JUST THE BEGINNING.
Slide 11: Superior Customer Experience
Superior Customer Experience Care, Listen, Understand, Deliver
Slide 12: Superior Customer Satisfaction
Superior Customer Satisfaction *Retail: 90% extremely/very satisfied Commercial: 90% extremely/very satisfied * Compared to national average of 63% Source: American Banker/Gallup Consumer Survey
Slide 13: Customer Satisfaction Metrics
Customer Satisfaction Metrics Attribute Q1/2008 Q1/2009 Employees are friendly and helpful 9.6 9.6 Bank seems easy to work with 9.5 9.5 Safety and security of a local bank NA 9.3 Wait times are brief 9.1 9.3 Wide range of products and services 9.0 9.1 Listens to my needs 9.1 9.1 Convenient branches
Slide 14: Capital (9/30/09 Est.)
Capital (9/30/09 Est.) With CPP Without CPP GAAP Capital $1.92 billion $1.55 billion Total Risk-Based Capital $1.89 billion $1.51 billion Ratios: With CPP Without CPP Total Risk-Based Capital 13.90% 11.10% Tier 1 Risk-Based Capital 11.20% 8.40% Leverage Capital 9.50% 7.10% Tangible Common Equity 6.2
Slide 15: Loan Distribution by State (Third Quarter)
Loan Distribution by State (Third Quarter) Average % of 09 v. 08 % Balance Total Growth Growth (dollars in thousands) Pennsylvania 6,442,000 $ 54.1% 225,000 $ 4% New Jersey 2,481,000 20.8% 79,000 3% Maryland 1,529,000 12.8% (62,000) -4% Virginia 1,122,000 9.4% (22,000) -2% Delaware 340,000 2.9% (3,0
Slide 16: Residential Mortgage and HE Loans
Residential Mortgage and HE Loans Q3 2009 % of Avg. Bal. Total Pennsylvania 1,313,000 $ 50.8% New Jersey 453,000 17.5% Maryland 452,000 17.5% Virginia 213,000 8.2% Delaware 154,000 6.0% 2,585,000 $ (dollars in thousands)
Slide 17: Commercial Loans by Industry
Commercial Loans by Industry Industry % Services 18.8 Manufacturing 13.7 RE - Rental and Leasing 12.4 Construction 11.2 Agriculture 8.6 Retail 8.1 Wholesale 7.3 Other 5.8 Health Care 5.7 Financial Services 3.1 Arts and Entertainment 3.0 Transportation 2.3 100.0
Slide 18: Commercial Loans by State
Commercial Loans by State Q3 2009 % of Avg. Bal. Total (dollars in thousands) Pennsylvania 2,380,000 $ 64.9% New Jersey 556,000 15.2% Maryland 400,000 10.9% Virginia 302,000 8.2% Delaware 30,000 0.8% 3,668,000 $
Slide 19: Construction Loans (September 30, 2009)
Construction Loans (September 30, 2009) Ending % of NPL Specific Balance Total Balance Allocations (dollars in thousands) Pennsylvania 285,000 $ 27.7% 14,800 $ 2,860 $ Virginia 266,000 25.9% 23,950 9,300 Maryland 260,000 25.3% 47,120 21,360 New Jersey 202,000 19.6% 18,920 3,640 Delaware 16,000 1.6%
Slide 20: Construction Loans by Type
Construction Loans by Type Ending % of Balance Total (dollars in thousands) Commercial Residential 690,000 $ 67.0% Commercial 260,000 25.3% Real Estate 63,000 6.1% Other Commercial 16,000 1.6% 1,029,000 $
Slide 21: CRE Loans by State (September 30, 2009)
CRE Loans by State (September 30, 2009) Ending % of NPL Specific Balance Total Balance Allocations (dollars in thousands) Pennsylvania 2,160,000 $ 51.6% 19,180 $ 10,630 $ New Jersey 1,198,000 28.6% 28,310 5,000 Maryland 372,000 8.9% 1,360 1,180 Virginia 328,000 7.8% 4,100 2,520 Delaware 129,000 3.1%
Slide 22: Loan Delinquency (Key Sectors)
Loan Delinquency (Key Sectors) Category Total (%) 9/30/08 90-Days 9/30/08 Total (%) 9/30/09 90-Days 9/30/09 Commercial Loans 1.68 1.14 2.26 1.65 Consumer Direct .91 .35 1.69 0.65 Commercial Mortgage 1.43 .84 1.84 1.31 Residential Mortgage 5.76 2.81 8.50 4.71 Construction 5.84 4.26 11.37 10.12 Total
Slide 23: Shared National Credits
Shared National Credits Ending Balance (dollars in thousands) Commercial / Industrial 116,849 $ Commercial Real Estate 47,485 Total Outstanding 164,334 $ Delinquency: 6.2%
Slide 24: Net Charge-offs (Q3 2009)
Net Charge-offs (Q3 2009) Comm'l Res. Mtg. Comm'l Mortgage Constr. and HE Other Total (in thousands) Pennsylvania 1,326 $ 1,383 $ $ $ 1,980 $ 5,046 $ Maryland 2,640 4,036 New Jersey 2,421 1,668 3,936 - 8,511 Virginia 2,545 - 2,487 5,914 Delaware - - - 7,343 $ 3,060 $ 9,330 $ 1,064 $ 3,436 $ 24,233 $
Slide 25: Net Charge-offs (YTD September 2009)
Net Charge-offs (YTD September 2009) Comm'l Res. Mtg. Comm'l Mortgage Constr. and HE Other Total (in thousands) Pennsylvania 3,020 $ 3,327 $ 4,242 $ 1,778 $ 5,084 $ 17,451 $ Maryland 1,607 2,683 16,408 1,378 22,648 New Jersey 8,680 6,354 6,073 1,533 22,863 Virginia 9,428 - 5,816 1,875 1,189 18,308 D
Slide 26: Non-performing Loans (September 30, 2009)
Non-performing Loans* (September 30, 2009) Comm'l Res. Mtg. Comm'l Mortgage Constr. and HE Other Total (in thousands) Pennsylvania 27,398 $ 19,177 $ 8,638 $ 10,109 $ 4,805 $ 70,127 $ Maryland 7,064 1,356 47,118 4,674 3,123 63,335 New Jersey 14,597 28,312 18,924 7,856 3,187 72,876 Virginia 13,930 4,1
Slide 27: Summary of Larger Loan Relationships
Summary of Larger Loans 53 relationships with commitments to lend of $20 million or more Maximum individual commitment- $33 million Maximum commitment land development- $28 million Average commercial lending relationship size is $ 466,247 Loans and corresponding relationships are within Fulton’s geo
Slide 28: Overview of Third Quarter
Overview of Third Quarter Continued core deposit growth Improved net interest margin Slightly lower provision Reduced construction exposure Lower net charge-offs Credit deterioration slowed Stable other income Expenses flat
Slide 29: Fulton Financial Corporation
‘FULTON FINANCIAL ‘CORPORATION
Slide 30: 2009 Financial Results (Q3 vs. Q2 2009)
2009 Financial Results (Q3 vs. Q2 2009) Q3 2009 Q2 2009 Net income 23,345,000 $ 13,110,000 $ Cost of preferred stock (5,045,000) (5,045,000) Net income available to common shareholders 18,300,000 $ 8,065,000 $ Earnings per share 0.10 $ 0.05 $ Return on tangible equity 7.91% 3.83%
Slide 31: Income Statement Summary (Q3 vs. Q2 2009)
Income Statement Summary (Q3 vs. Q2 2009) Q3 2009 Q2 2009 $ % (dollars in thousands) Net Interest Income 132,800 $ 127,940 $ 4,860 $ 4% Loan Loss Provision (45,000) (50,000) 5,000 -10% Other Income 41,230 45,300 (4,070) -9% Securities Gains (Losses) (50) (130) -163% Other Expenses (99,810) (107,810)
Slide 32: Pre-Tax Income Summary (Q3 vs. Q2 2009)
Pre-Tax Income Summary (Q3 vs. Q2 2009) Q3 2009 Q2 2009 $ % (dollars in thousands) Net Interest Income 132,800 $ 127,940 $ 4,860 $ 4% Other Income 41,230 45,300 (4,070) -9% Other Expenses (99,810) (100,080) 0% Pre-Tax Income Before LLP, CC Gain, Sec Gains (Losses), Special FDIC 74,220 73,160 1,060 1
Slide 33: 2009 Financial Results (YTD September)
2009 Financial Results (YTD September) Net income 49,540,000 $ 96,250,000 $ Cost of preferred stock (15,120,000) - Net income available to common shareholders 34,420,000 $ 96,250,000 $ Earnings per share 0.20 $ 0.55 $ Return on tangible equity 5.24% 14.00%
Slide 34: Income Statement Summary (YTD September)
Income Statement Summary (YTD September) $ % (dollars in thousands) Net Interest Income 384,860 $ 391,810 $ (6,950) $ -2% Loan Loss Provision (145,000) (54,630) (90,370) 165% Other Income 130,520 116,640 13,880 12% Credit Card Sale Gain - 13,910 (13,910) nm Securities Gains (Losses) 2,950 (29,900) 3
Slide 35: Pre-Tax Income Summary (YTD September)
Pre-Tax Income Summary (YTD September) $ % (dollars in thousands) Net Interest Income 384,860 $ 391,810 $ (6,950) $ -2% Other Income 130,520 116,440 14,080 12% Other Expenses (300,023) (289,690) (10,333) 4% Pre-Tax Income Before LLP, CC Gain, Sec Gains (Losses), FDIC and ARC 215,357 218,560 (3,203)
Slide 36: Peer Group
Peer Group* International Bancshares Corporation Old National Bancorp South Financial Group, Inc. Susquehanna Bancshares, Inc. TCF Financial Corporation Trustmark Corporation UMB Financial Corporation United Bankshares, Inc. Valley National Bancorp Whitney Holding Corporation Wilmington Trust Corpor
Slide 37: Net Interest Margin
Net Interest Margin 3.48 3.54 3.15 3.00 3.50 4.00 4.50 5.00 FFC Peer Top 50
Slide 38: Average Loans (Q3 vs. Q2 2009)
Average Loans (Q3 vs. Q2 2009) Q3 2009 Q2 2009 $ % (dollars in millions) Commercial 3,670 $ 3,660 $ $ 0% Comm'l Mort 4,160 4,090 2% Resid Mort (10) -1% Home Equity 1,650 1,670 (20) -1% Construction 1,050 1,150 (100) -9% Cons./Other - 0% Total Loans 11,910 $ 11,960 $ (50) 0%
Slide 39: Ending Loans (Q3 vs. Q2 2009)
Ending Loans (Q3 vs. Q2 2009) Q3 2009 Q2 2009 $ % (dollars in millions) Commercial 3,720 $ 3,610 $ $ 3% Comm'l Mort 4,190 4,120 2% Resid Mort - 0% Home Equity 1,650 1,650 - 0% Construction 1,030 1,100 (70) -6% Cons./Other (10) -2% Total Loans 11,970 $ 11,870 $ 1%
Slide 40: Average Loans (YTD September)
Average Loans (YTD September) $ % (dollars in millions) Commercial 3,660 $ 3,500 $ $ 5% Comm'l Mort 4,100 3,670 12% Resid Mort 4% Home Equity 1,670 1,570 6% Construction 1,140 1,330 (190) -14% Cons./Other (40) -8% Total Loans 11,970 $ 11,470 $ 4%
Slide 41: Average Deposits (Q3 vs. Q2 2009)
Average Deposits (Q3 vs. Q2 2009) Q3 2009 Q2 2009 $ % (dollars in millions) Nonint DDA 1,920 $ 1,810 $ $ 6% Int DDA 1,880 1,820 3% Savings/MMDA 2,560 2,310 11% CD's 5,560 5,630 (70) -1% Cash Management (40) -7% Total Deposits 12,430 $ 12,120 $ 3%
Slide 42: Average Deposits (YTD September)
Average Deposits (YTD September) $ % (dollars in millions) Nonint DDA 1,800 $ 1,650 $ $ 9% Int DDA 1,820 1,710 6% Savings/MMDA 2,310 2,180 6% CD's 5,540 4,390 1,150 26% Cash Management (150) -21% Total Deposits 12,020 $ 10,630 $ 1,390 13%
Slide 43: Other Borrowings (YTD September)
Other Borrowings (YTD September) $ % (dollars in millions) Federal Funds $ 1,300 $ (730) $ -56% FHLB Advances 1,370 1,450 (80) -6% Other LT Debt - 0% Other ST Borrowings (300) -81% Total Borrowings 2,390 $ 3,500 $ (1,110) $ -32%
Slide 44: Net Interest Margin Trend
Net Interest Margin Trend 3.70 3.62 3.56 3.58 3.77 3.64 3.45 3.43 3.55 3.67 3.59 3.54 3.56 3.68 3.74 3.63 3.45 3.42 3.53 3.75 3.20 3.40 3.60 3.80 4.00 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Reported Normalized
Slide 45: Other Income
Other Income $0 $20 $40 $60 $80 $100 $120 $140 $160 Millions
Slide 46: Other Income (Q3 vs. Q2 2009)
Other Income (Q3 vs. Q2 2009) Q3 2009 Q2 2009 $ % (dollars in thousands) Overdraft & NSF Fees 9,340 $ 8,790 $ $ 6% Invt Mgt & Trust 8,190 7,880 4% Service Charges 3,340 3,180 5% Success Card Fees 2,870 2,750 4% Mort. Sales Gains 2,780 7,400 (4,620) -62% Cash Mgt Fees 2,650 3,090 (440) -14% Merchant
Slide 47: Other Income (YTD September)
Other Income (YTD September) $ % (dollars in thousands) Overdraft & NSF Fees 26,570 $ 25,790 $ $ 3% Invt Mgt & Trust 23,970 25,190 (1,220) -5% Mort. Sales Gains 18,760 7,250 11,510 159% Service Charges 9,760 9,740 0% Cash Mgt Fees 8,940 9,930 (990) -10% Success Card Fees 8,060 7,340 10% Merchant Fee
Slide 48: Efficiency Ratio
Efficiency Ratio 58.8 61.4 61.6 50.0 52.0 54.0 56.0 58.0 60.0 62.0 64.0 YTD YTD FFC Peer Top 50
Slide 49: Other Expense (Q3 vs. Q2 2009)
Other Expense (Q3 vs. Q2 2009) Q3 2009 Q2 2009 $ % (dollars in thousands) Salaries & Benefits 54,090 $ 55,800 $ (1,710) $ -3% Occupancy & Equip. 13,450 13,540 (90) -1% FDIC Insurance 5,240 12,210 (6,970) -57% Data Proc. & Software 4,740 4,610 3% Supplies & Postage 2,820 2,700 4% Legal & Audit 2,390
Slide 50: Other Expense (YTD September)
Other Expense (YTD September) $ % (dollars in thousands) Salaries & Benefits 165,190 $ 164,790 $ $ 0% Occupancy & Equip. 41,090 40,910 0% FDIC Insurance 21,740 2,680 19,060 nm Data Proc. & Software 13,970 13,810 1% Supplies & Postage 8,190 8,520 (330) -4% Legal & Audit 6,700 5,720 17% Operating Risk
Slide 51: Allowance for Credit Losses
Allowance for Credit Losses Q3 2009 Q2 2009 (dollars in thousands) Balance at beginning of period 220,950 $ 200,060 $ Loan Loss Provision 45,000 50,000 Net Charge-Offs (24,230) (29,110) Balance at end of period 241,720 $ 220,950 $ Allowance to Loans 2.02% 1.86% Nonperforming Assets to Assets 1.82% 1
Slide 52: Allowance for Credit Losses (YTD Sept.)
Allowance for Credit Losses (YTD Sept.) (dollars in thousands) Balance at beginning of year 180,140 $ 112,210 $ Loan Loss Provision 145,000 54,630 Net Charge-Offs (83,420) (25,010) Balance at September 30th 241,720 $ 141,830 $ Allowance to Loans 2.02% 1.20% Nonperforming Assets to Assets 1.82% 1.15%
Slide 53: Net Charge-Offs To Average Loans
Net Charge-Offs To Average Loans 0.93 1.10 1.67 0.00 0.30 0.60 0.90 1.20 1.50 1.80 YTD YTD FFC Peer Top 50
Slide 54: Investment Portfolio (September 30, 2009)
Investment Portfolio (September 30, 2009) ENDING MODIFIED BALANCE DURATION (in millions) Agency mortgage-backed securities 1,112.0 $ 3.40 Agency collateralized mortgage obligations 975.4 2.83 Municipal bonds 415.8 4.44 Auction rate securities 292.3 4.02 Corporate & trust preferred securities 155.3 1
Slide 55: Available Funds and Collateral
Available Funds Total Available for Collateral $550,152,337 Total Borrowing Capacity $3,091,875,093 Total Available Collateral and Borrowing Capacity $3,642,027,431 Securities Availabile as Collateral: 09/30/09 Total Unpledged Securities $694,042,360 Less: Corporate / Trups / ARCs (200,378,078) Less
Slide 56: Status of the Corporation
Status of the Corporation Strong capital position Focus on profitable organic growth Positioned for economic rebound Current loan loss reserve levels believed to be adequate Proactive management of problem credits Valuable 5-state franchise / strong in-state markets Disciplined expense control
Slide 57: Fulton Financial Corporation
Fulton Financial Corporation One Penn Square Lancaster, PA 17602 www.fult.com
Slide 58: Fulton Financial affiliate banks
Gi The Bank Bl The Columbia Bank 0 Delaware National Bank Gi FNB Bank, N.A. BH Fulton Bank, N.A. IB Lafayette Ambassador Bank I Skylands Community Bank Bi Swineford National Bank Pennsylvania ‘FULTON FINANCIAL ‘CORPORATION
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