Southstate Bank Corporation · NYSE:SSB
Southstate Bank — SCBT Financial — Investor Presentation (November 2011)
67 slides from Southstate Bank's investor presentation, Nov 10, 2011
Slide 1: SCBT Financial Corporation
SCBT FINANCIAL CORPORATION
Slide 2: Forward-Looking Statements
Forward-Looking Statements Statements contained in this presentation, which are not historical facts, are forward-looking statements. In addition, SCBT Financial Corporation (SCBT) through its senior management or directors may from time to time make forward-looking public statements concerning matt
Slide 3: Largest publicly traded bank headquartered in South Carolina
Largest publicly traded bank headquartered in South Carolina Serving the banking needs of customers within the Carolinas for 77 years and Georgia for 107 years Strong asset quality and credit underwriting remain the fundamentals of SCBT SCBT Financial Corporation
Slide 4: SCBT Footprint
SCBT Footprint North Carolina 3 branches $ 254 Million Deposits #8 Rank in Charlotte MSA South Carolina 49 branches $ 2.16 Billion Deposits #8 Rank Northeast Georgia 28 branches $ 869 Million Deposits #5 Rank Headquarters- Columbia, SC *Market share ranking as of June 30,2011, all other reported for
Slide 5: Market Performance
Market Performance Data as of 10/27/11. Source: SNL Financial and Company filings. KRX is a composition of 50 regionally diversified mid & small-cap banking institutions in the U.S. The index is calculated using an equal-weighted method and components comply with the GICS and ICS classification stan
Slide 6: Profitability
Profitability Per share data reflect a ten percent stock dividend distributed on December 6, 2002, a five percent stock dividend distributed on January 1, 2005 and a five percent stock dividend distributed on March 23, 2007. For 2008, the loss related to the disposal of Freddie Mac Preferred Stock i
Slide 7: Vision and Mission
VISION To be a top performing Regional Bank in the Southeast. MISSION Our mission is to build a high performing, Regional Bank based on a balance of soundness, profitability and growth. We will accomplish this through relationship banking, delivered by engaged employees with clear strategic goals, o
Slide 8: Strategic Areas of Focus
Strategic Areas of Focus LEADERSHIP FINANCIAL A CORPORATION”
Slide 9: Impact to SCBT
Impact to SCBT Focus Differentiates SCBT Low Turnover Attracts Customers and Employees Clear Roadmap
Slide 10: Highlights of SCBT
Highlights of SCBT Profitable Every Quarter of Downturn Fortress Balance Sheet Improved Credit Trends 77 Years of Service in South Carolina 107 Years of Service in Georgia Strong Culture Consistent Growth Organic Growth Selective M&A strategy Well-positioned for Future
Slide 11: 3rd Quarter 2011 Highlights
3rd Quarter 2011 Highlights Solid Net Income, $10.3 million– best performance in 8 quarters BankMeridian acquisition: third FDIC-assisted transaction and second this year, with after tax gain of $6.8 million Organic Loan Growth 9% increase from 3Q10 Core Deposit growth 17% increase from 3Q10 Fee Inc
Slide 12: Goals and Priorities
Goals and Priorities Execute and integrate Meridian Prepare for consolidation Focus on organic growth Return to normalized EPS
Slide 13: Leadership
Leadership Experienced Executive Management Team Executive Position Years in Banking Years with SCBT Robert R. Hill, Jr. CEO 23 16 John C. Pollok Sr. EVP, COO 25 15 Joe E. Burns Sr. EVP, CRO 34 11 John F. Windley President, CBO 35 9 Donald E. Pickett EVP, CFO 16 2 Renee R. Brooks EVP, CAO 19 15 13
Slide 14: South Carolina Deposit Market Share
South Carolina Deposit Market Share Source: FDIC Summary of Deposits as of 6/30/2011. Rank Institution ($000) Deposits Share Market Branches 1 Wells Fargo & Co (CA) 12,009,580 17.69% 151 2 Bank of America (NC) 9,043,470 13.32% 111 3 BB&T (NC) 6,662,063 9.82% 115 4 First Citizens Bancorp (SC) 6,079,4
Slide 15: Charlotte Deposit Market Share
Charlotte Deposit Market Share Source: FDIC Summary of Deposits as of 6/30/2011. Rank Institution ($000) Deposits Share Market Branches 1 Bank of America (NC) $127,934,050 79.59% 60 2 Wells Fargo & Co (CA) 18,297,321 11.38% 81 3 BB&T (NC) 4,038,087 2.51% 59 4 Fifth Third Bank (OH) 1,478,806 .92% 35
Slide 16: Northeast Georgia Deposit Market Share
Northeast Georgia Deposit Market Share Note: NE Georgia Deposit Market Share includes the following counties: Barrow, Habersham, Hall, Jackson, Oconee, Rabun, Stephens, Towns, Warren, White. *Projected January 2012, 20 branches Source: FDIC Summary of Deposits as of 6/30/2011. Rank Institution ($000
Slide 17: Capital
Capital Redeemed preferred stock & common stock warrants First bank in South Carolina & one of the first nationally Capital Raise: $91 million $27M October 2008 $29M May 2009 $35M February 2011
Slide 18: Habersham Bank / BankMeridian
Habersham Bank BankMeridian
Slide 19: Transaction Overview
Transaction Overview SCBT has purchased and assumed certain assets and liabilities from the FDIC as receiver of BankMeridian N.A., Columbia, SC. Closed on July 29,2011 Purchased approximately $240 million in total assets, including $176 million in loans (1) Asset discount bid of $30.8 million, Loss
Slide 20: Overview of BankMeridian, N.A.
Overview of BankMeridian, N.A. 20 Data Source: SNL Financial Charleston Columbia Greenville Spartanburg County, SC Distance: 236 ft Richland County, SC Hilton Head Beaufort County, SC Distance: 1.1 mi Distance: 0.9 mi SCBT BankMeridian, N.A.
Slide 21: Proven Acquirer
Proven Acquirer 21 Data Source: SNL Financial SCBT legacy branches Disciplined FDIC bidder with loss sharing experience Key FDIC-Assisted Transactions Assets ($mm) Branches BankMeridian, N.A. $240 3 Habersham Bank 388 8 Community Bank & Trust 1,017 36 Proven Acquirer
Slide 22: Soundness
SUUNDNESS
Slide 23: Credit Quality
Credit Quality Source: SNL Financial and Company filings. Data as of 6/30/11. KRX is a composition of 50 regionally diversified mid- & small-cap banking institutions in the U.S. The index is calculated using an equal-weighted method and components comply with the GICS and ICS classification standard
Slide 24: Credit Quality Ratios
Credit Quality Ratios 2Q’10 3Q’10 4Q’10 1Q’11 2Q’11 3Q’11 Non-Performing Assets / Total Assets* 2.37% 2.39% 2.41% 2.29% 2.44% 2.44% Non-Performing Assets / Total Loans & OREO* 3.84% 3.80% 3.74% 3.83% 3.86% 3.87% Allow. Loan Losses / Total Loans* 2.07% 2.07% 2.07% 2.05% 2.00% 2.00% Allow. Loan Losses
Slide 25: Capital
Capital Source: SNL Financial and Company filings. Data as of 6/30/11. KRX is a composition of 50 regionally diversified mid- & small-cap banking institutions in the U.S. The index is calculated using an equal-weighted method and components comply with the GICS and ICS classification standards. Caro
Slide 26: Profitability
PROFITABILITY
Slide 27: Consistent Long-Term Earnings Power
Consistent Long-Term Earnings Power * Represents after-tax gain from CBT acquisition In Millions 115.9 Pre-tax, Pre-Provision Earnings
Slide 28: Net Interest Margin (TE)
Net Interest Margin (TE) Source: BHC Performance Report. Peers are BHC with assets between $3 billion & $10 billion
Slide 29: Operating Efficiency
Operating Efficiency 33 2011 Efficiency Ratio – Habersham consolidation With Branch consolidation, Phase 3 – 68 Branches *
Slide 30: Dividends
Dividends Dividend paid for 137 consecutive quarters since 1976 Prior to 1976, dividends were paid semi-annually 3nd Quarter 2011 includes dividends declared on 10/27/11, record date of 11/18/11, payable on 11/25/11
Slide 31: Growth
[LOGO]
Slide 32: Growth Strategy
Growth Strategy Build strong bank in South Carolina, North Carolina, and Georgia Organic Growth is Top Priority FDIC Deals Whole Bank Acquisitions Growth Goals: Drive EPS Top 5 in market share Build a franchise
Slide 33: Organic Loan Growth
Organic Loan Growth In Millions * Bars represent Non-Acquired Loan Growth, linked quarter
Slide 34: Non-Performing Loans
Non-Performing Loans Source: SNL Financial and Company filings. Data as of 06/30/11 KRX is a composition of 50 regionally diversified mid- & small-cap banking institutions in the U.S. The index is calculated using an equal-weighted method and components comply with the GICS and ICS classification st
Slide 35: Deposit Mix – September 30, 2011
Deposit Mix – September 30, 2011 Demand Deposits 20% Savings 8% Interest Bearing Deposits 43% CD < 100,000 16% CD > 100,000 13%
Slide 36: Growth – Core & Total Deposits
Growth – Core & Total Deposits In Millions *Core Deposits exclude all certificates of deposits *As of September 30, 2011 Core deposits grew $460 million since Dec-10; Legacy SCBT $221 million / Acquired $239 million 2011 YTD # Transaction account growth for Legacy SCBT 10.0% annualized Total YTD $ B
Slide 37: Business Mix by Market – September 30, 2011
Business Mix by Market – September 30, 2011 Loans Deposits Inland SC 51% Coastal SC 24% Charlotte MSA 23% Georgia 2% Inland SC 42% Coastal SC 14% Charlotte MSA 16% Georgia 28% *Inland SC includes Florence
Slide 38: Supplemental Information
Habersham Bank SUPPLEMENTAL INFORMATION
Slide 39: Index – Supplemental Information
Index – Supplemental Information Unemployment Rates SC real estate markets Fee income by type Credit Coverage ratios Credit Trends Construction / Land Development Loans Construction/ Land Development Loan Mix Vintage/New Loan Mix ALLL Trend (New) Loan portfolio summary – Type NPA’s by Region Classif
Slide 40: Unemployment Rates in SCBT Markets
Unemployment Rates in SCBT Markets Georgetown SCBT Divisions Charlotte Greenville Columbia Georgetown Orangeburg/Low Country Charleston Hilton Head North Georgia SC 11.1% NC 10.4% GA 10.2% Columbia Charlotte Hilton Head Charleston Greenville Orangeburg/Low Country North Georgia 11.2% 11.0% 11.0% 10.
Slide 41: S.C. Real Estate Markets
S.C. Real Estate Markets Source: August 2011 Rates from S.C. Realtors MLS Stats Beaufort 674 686 1.8% 179 179 0.1% 170 200 17.6% Charleston Trident 6,083 6,254 2.8% 187 180 -3.7% 108 110 1.9% Coastal Carolinas 4,997 5,047 1.0% 150 139 -7.3% 172 180 4.7% Gr. Columbia 5,249 4,339 -17.3% 141 140 -0.9%
Slide 42: Fee Income By Type
Fee Income By Type 2Q'10 3Q'10 4Q'10 1Q'11 2Q'11 3Q11 Service charges on deposit accounts 5,582 $ 5,683 $ 5,554 $ 5,030 $ 5,615 $ 6,050 $ Bankcard services income 2,348 2,397 2,443 2,659 3,045 2,980 Mortgage banking income 1,267 1,934 2,519 863 1,125 2,341 Trust and investment services income 1,187
Slide 43: Strong Coverage Ratios Driven by Low NPAs
Strong Coverage Ratios Driven by Low NPAs 30-89 Delinquencies/Loans NPAs/(Loans + OREO) NCOs/Avg. Loans Reserves/Loans (ex HFS) Source: SNL Financial, FDIC and FFEIC, KBW Peer Data as of 6/30/11 Asset quality ratios exclude loans covered by the FDIC and loans held for sale
Slide 44: Credit Trends
Credit Trends (dollars in millions) (1) Texas ratio – Delinquent loans + nonperforming assets / Tangible Common Equity + ALLL (2) Criticized Loans – Special Mention (3) Classified Assets (Classified loans & OREO) *Excludes assets related to covered loss share 30-Jun-10 30-Sep-10 31-Dec-10 31-Mar-11
Slide 45: Construction / Land Development Loans
Construction / Land Development Loans 4Q 2007 3Q 2011 Loan Type 4Q07 % 3Q11 % Consumer Construction $ 50,269 9% $ 43,208 14% Land/Lots $ 153,682 28% $ 149,647 47% Construction Loans to Builders $ 73,768 13% $ 13,938 4% Commercial Construction $ 106,821 19% $ 19,533 6% Residential Lot Loans to Indivi
Slide 46: Construction / Land Development Loan Mix – 3Q 2011
Construction / Land Development Loan Mix – 3Q 2011 *New=Origination date of 1/1/08 or later
Slide 47: Vintage / New Loan Mix – 3Q 2011
Vintage / New Loan Mix – 3Q 2011 *New=Origination date of 1/1/08 or later, non-acquired loans
Slide 48: ALLL Trend Data (Non-Acquired Loans)
ALLL Trend Data (Non-Acquired Loans) 1.45% 1.55% 1.70% 1.90% 2.07% 2.07% 2.07% 2.05% 2.00% 2.00% Note: Net charge-offs excludes the impact of loan participations and a BHC loan.
Slide 49: Loan Portfolio Summary - Type
Loan Portfolio Summary - Type * Loans not acquired (dollars in thousands) Jun-10 Sep-10 Dec-10 Mar-11 Jun-11 Sep-11 Construction / land development 422,866 $ 402,256 $ 391,987 $ 370,442 $ 338,288 $ 316,072 $ Commercial non-owner occupied 308,980 322,050 320,203 332,773 306,698 304,616 Consumer owner
Slide 50: NPAs by Region
NPAs by Region *Second Quarter branch impairment REGION Jun-09 Sep-09 Dec-09 Mar-10 Jun-10 Sep-10 Dec-10 Mar-11 Jun-11 Sep-11 (in thousands) Beaufort 7,201 $ 7,368 $ 11,543 $ 10,418 $ 26,072 $ 26,659 $ 26,401 $ 25,949 $ 26,806 $ 24,104 $ Charleston 355 4,591 4,528 3,867 4,074 4,090 3,487 8,054 7,477
Slide 51: Classified Loans & OREO by Region
Classified Loans & OREO by Region *Second Quarter branch impairment REGION Dec-09 Mar-10 Jun-10 Sep-10 Dec-10 Mar-11 Jun-11 Sep-11 (in thousands) Beaufort 32,136 $ 40,766 $ 48,464 $ 43,979 $ 47,953 $ 46,279 $ 44,377 $ 40,692 $ Charleston 26,844 28,849 28,676 29,737 28,694 22,406 16,234 17,420 Grand
Slide 52: NPAs by Type
NPAs by Type (dollars in thousands) *Loans and OREO not acquired Jun-10 Sep-10 Dec-10 Mar-11 Jun-11 Sep-11 Jun-11 Construction/Land Development 37,611 $ 34,327 $ 28,390 $ 29,435 $ 28,525 $ 25,470 $ 26.5% Commercial Non-Owner Occupied 11,875 8,740 10,073 12,192 12,630 11,272 11.7% Commercial Owner Oc
Slide 53: Charge Offs by Type
Charge Offs by Type (dollars in thousands) Jun-10 Sep-10 Dec-10 Mar-11 Jun-11 Sep-11 Sep-11 Construction/Land Development 3,630 $ 5,463 $ 4,643 $ 4,537 $ 2,240 $ 2,440 $ 32.9% Commercial Non-Owner Occupied 488 1,493 512 1,236 520 1,052 14.2% Commercial Owner Occupied 917 376 504 729 303 1,126 15.2%
Slide 54: Investment Portfolio Mix
Investment Portfolio Mix *Fair value for AFS securities; amortized/accreted cost for HTM securities. Does not include FRB stock, FHLB stock, or investment in unconsolidated subsidiaries. Investment Portfolio (AFS & HTM) As of 9/30/11 Tax Equivalent Yield 3.53% Weighted Average Life 3.67 years Modifi
Slide 55: Investment Portfolio – September 30, 2011
Investment Portfolio – September 30, 2011 (Dollars in thousands) Includes held-to-maturity and available-for-sale municipal securities. Note: All Agency MBS and CMOs carry the backing of the agency or GSE and have an implied AAA rating. Book Value Market Value Other Compre- hensive Income AAA - A BB
Slide 56: Total Assets by Risk Weighting %
Return on Risk Weighted Assets = 0.80% (Peer Median (1) = 0.26%) Risk Weighted Assets / Total Assets = 63.85% (Peer Median (1) = 73%) Peer % of 100% RWAs = 63.3% Total Assets by Risk Weighting % Source: SNL Financial, FDIC and FFEIC, KBW Data as of 6/30/11 (dollars in millions) Asset quality ratios
Slide 57: 3Q 2011 Loan Valuation
3Q 2011 Loan Valuation Loan (1) Carrying Value and the Yield represents the Earning Assets and related Yield as included in the Rate Volume. (2) The elevated yield on the acquired loans is primarily caused by the improved credit loss expectations first observed in 1Q2011. Improved credit losses resu
Slide 58: Loss Share Performance
Loss Share Performance (1) Does not include expense, net of revenues (only losses claimed) (2) Represents the estimated losses on OREO at period end. These losses have been recognized to record OREO at net realizable value. Losses are claimable from the FDIC upon sale or receipt of a valid appraisal
Slide 59: Continued CD Repricing Opportunities
Continued CD Repricing Opportunities Average CD Price in past 3 months 0.43% Upcoming Maturities Amount Yield 4th Quarter 2011 262.0 $ 0.96% 1st Quarter 2012 249.2 $ 0.74% 2nd Quarter 2012 133.6 $ 0.72%
Slide 60: Georgia Branch Consolidation
Georgia Branch Consolidation Initial Branch Count: 46 Phase 1 12 Phase 2 5 Phase 3 9 Total Closures 26 Branch count at end of project: 20 Cost saves to be recognized (pre-tax) Phase 2 $6 million - beginning 3rd Q 2011 Phase 3 $3 million - beginning 1st Q 2012
Slide 61: Market Demographics
Market Demographics Source: SNL Financial, Inc. South Carolina Franchise 18.89% 8.35% $48,788 13.21% North Carolina Franchise 34.87 13.77 66,472 14.20 Georgia Franchise 31.78 9.17 46,447 11.78 National 10.59 3.85 54,442 12.39 Population Growth Rate 2000-2010 2010-2015 Household Median Income 2010 Pr
Slide 62: Columbia MSA – Economic Drivers
Oconee Pickens Greenville Anderson Spartanburg Cherokee York Union Chester Laurens Abbeville Newberry Greenwood McCormick Saluda Edgefield Aiken Lancaster Chesterfield Kershaw Fairfield Lexington Richland Marlboro Dillon Darlington Lee Sumter Florence Marion Horry Williamsburg Georgetown Clarendon B
Slide 63: Charlotte MSA – Economic Drivers
Charlotte MSA – Economic Drivers HEALTH SERVICES | FINANCIAL | SERVICES | WHOLESALE TRADE MANUFACTURING | TRANSPORTATION Oconee Pickens Greenville Anderson Spartanburg Cherokee York Union Chester Laurens Abbeville Newberry Greenwood McCormick Saluda Edgefield Aiken Lancaster Chesterfield Kershaw Fai
Slide 64: Greenville MSA – Economic Drivers
Oconee Pickens Greenville Anderson Spartanburg Cherokee York Union Chester Laurens Abbeville Newberry Greenwood McCormick Saluda Edgefield Aiken Lancaster Chesterfield Kershaw Fairfield Lexington Richland Marlboro Dillon Darlington Lee Sumter Florence Marion Horry Williamsburg Georgetown Clarendon B
Slide 65: Charleston MSA – Economic Drivers
Oconee Pickens Greenville Anderson Spartanburg Cherokee York Union Chester Laurens Abbeville Newberry Greenwood McCormick Saluda Edgefield Aiken Lancaster Chesterfield Kershaw Fairfield Lexington Richland Marlboro Dillon Darlington Lee Sumter Florence Marion Horry Williamsburg Georgetown Clarendon B
Slide 66: Analyst Recommendations
Analyst Recommendations ANALYST Third Quarter 2011 RECOMMENDATION FIG Partners OUTPERFORM Keefe, Bruyette & Woods OUTPERFORM Raymond James MARKET PERFORM Sandler O’Neill + Partners HOLD SunTrust Robinson Humphrey BUY Wunderlich Securities BUY
Slide 67: Investor Contacts
Investor Contacts Robert R. Hill, Jr. Chief Executive Officer John C. Pollok Senior Executive Vice President and Chief Operating Officer Donald E. Pickett Executive Vice President and Chief Financial Officer 520 Gervais Street Columbia, South Carolina 29201 800-277-2175 www.scbtonline.com
SCBT Financial — Investor Presentation (November 2011) on 6ix