1st Source Corporation · NASDAQ:SRCE
1st Source — INVESTIndiana (September 2010)
32 slides from 1st Source's conference presentation, Sep 7, 2010
Slide 1: INVESTIndiana
INVESTIndiana September 9, 2010 Source. iBank Source. __ iCorporation
Slide 2: Forward-looking Statement Disclosure
Forward-looking Statement Disclosure Except for historical information contained herein, the matters discussed in this document express “forward-looking statements.” Generally, the words “believe,” “expect,” “intend,” “estimate,” “anticipate,” “project,” “will” and similar expressions indicate forwa
Slide 3: Corporate Overview
Corporate Overview $4.5 billion community bank with international reach « Personal and business banking, specialty finance, leasing, investment management, trust & estate planning, insurance sales, and mortgage banking operations « Founded in 1863, headquartered in South Bend, Indiana * Market cap -
Slide 4: 1st Source Strategy
1st Source Strategy * Deliver personalized, community banking to individuals, businesses and institutions within northern Indiana and southwestern Michigan through knowledgeable, local members of the community ¢ Diversify and add growth through our national and international specialty finance market
Slide 5: Locations
Locations + 76 Banking Centers + 94 Twenty-four hour ATMs * 22 Specialty Finance locations nationwide + 71st Source Insurance offices + 7 Trust & Wealth Management locations << oy ete son
Slide 6: Market Area
Market Area CoMMUNITY BANK Deposits: $3.1 Button Loans: $1.6 Bution SPECIALTY FINANCE $0.5 Button $1.5 Bution JUNE 30, 2010
Slide 7: Business Mix
Business Mix 6/30/10 Personal Community Banking Business Community Banking Specialty Finance $505 million $1.1 billion $1.5 billion Source. _ iCorporation
Slide 8: Slide 8
Slide 9: Specialty Finance
Specialty Finance _ $596 million $416 million $309 million $186 million Aircraft Auto, Light Truck — Construction Medium and Financing and Environmental Equipment Heavy Duty Truck Equipment 6/30/2010 ee
Slide 10: Community Banking County Market
Community Banking 15 COUNTY MARKET Market HHs: 620,498 CLIENTS: 106,166 PENETRATION: 17.1% BusINEss: 66,512 BusINEss CLIENTS: 18,016 PENETRATION: 27.1% FDIC Deposits: $3,590,578 Marker SHARE: 13.4% New Markets: KALAMAZOO LAFAYETTE JuNE 30, 2009 a —_________ eeerporation
Slide 11: Community Bank Industry
Community Bank Industry Se Higher Education = Regiona Medical Hub i ty Medical Devices 3 OF Auto Supply Mfg. <= Agriculture Sara Steel Production RV & Manufactured Housing Source. __ iCorporation
Slide 12: Deposit Market Share
Deposit Market Share 15-County Market $(000) 3,500,000 = Ist Source Bank 3,000,000 JPM Chase 2,500,000 —t—PNC 2,000,000 —@ Fifth Third 1,500,000 4 o~ Lake City TCU 1,000,000 500,000 , , T : : 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 << . . Data as of 6/2009 — Highline Financial Source 0 ov
Slide 13: Market Share
Market Share #1 market share in mortgage loans.
Slide 14: Client Satisfaction
Client Satisfaction Local Newspapers’ Reader Polls ¢ “Favorite Bank in Michiana Region” by readers of The South Bend Tribune for the 7th consecutive year, 2010 ¢ “Best of Marshall County” by readers of The Plymouth Pilot, 2009 + “Best of the Best” by readers in southwestern Michigan, 2010 (Niles, Ca
Slide 15: Larry Lentych
Larry Lentych Chief Financial Officer Source. __ iCorporation
Slide 16: Balance Sheet Highlights
Balance Sheet Highlights 12/31/09 6/30/10 Change ($ Millions) Total Assets $4,542.1 $4,531.3 (0.2)% Total Loans & Leases $3,093.2 $3,131.7 1.2% Total Deposits $3,652.5 $3,609.6 (1.2)% Total Common Equity $ 465.4 $ 483.9 40% Total Common Equity to Assets 10.3% 10.7% - =< > Source. __ — ——_ bei Corpor
Slide 17: Second Quarter Earnings Highlights
Second Quarter Earnings Highlights 2nd Quarter Year-to-Date 2009 2010 Change 2009 2010 Change Net Income $ 6,283 $ 7,795 24.1% $ 12,534 $17,474 39.4% (000’s) EPCS (Diluted) ¢ 0,19 $ 0.25 31.6% $ 039 $ 057 46.2% ROA 0.56% 0.69% - 0.56% 0.78% - ROCE 3.93% 5.06% - 4.12% 5.93% a <= Source. __ — ——_ bei
Slide 18: Net Interest Income
Net Interest Income mm Net Interest Income (FTE) — Net Interest Margin (FTE) ($MM) (%) 40 35 30 25 20 15 10 34.03 34.26 34.24 4 3284 33.03 pe 31.6.
Slide 19: Loan & Lease Quality
Loan & Lease Quality (% of Loans and Leases) — Nonperforming Assets — Net Charge-Offs ——Loan & Lease Loss Reserve Rolling Four Qtr Annual ET 3.15 3.0 f 2.5 5 2.0 + 1.5 7 1.0 + 0.5 F 0.0 T T T T 1 June Dec June Dec June 2008 2009 2010 Source. __ — ——_ bei Corporation
Slide 20: Asset Quality — Net Charge-offs to Loans and Leases
Asset Quality — Net Charge-offs to Loans and Leases 3.00% 5 2.00% 5 1.00% - 0.00% 2.49% 9 12% 63% 2.84% 2.34% 2.35% 1.88% | 1st Source 2009 + 2010Q1 All FDIC Insured Institutions 2009 2010Q1 $1- $10B FDIC Chicago Institutions Region 2009 2010 Q1 2009 2010 Q1 iSource. _ Corporation
Slide 21: Asset Quality — Noncurrent Assets plus OREO to Assets
Asset Quality — Noncurrent Assets plus OREO to Assets 4.00% 4 3.00% 5 2.20% 914% 2.00% 5 1.00% + 0.00% 3.59% 3.69% 3.43% | | | 1st Source 2009 Q4 201001 << All FDIC Insured $1 -$10B FDIC Chicago Institutions Institutions Region 2009 Q4 201001 2009 Q4 201001 2009 Q4 201001 Source. __ iCorporation
Slide 22: Noninterest Income
Noninterest Income 20.37 12.38 30.23 20.55 ($MM) 30 F 24 - 18 12 22.71 20.26 22.02 20.92 20.60 Total Noninterest Income Gains & Losses Other Income Deposit fees Equipment Leasing Mortgage Income Trust Fees Source. _ iCorporation
Slide 23: Diluted Net Income per Common Share
Diluted Net Income per Common Share $1.75 44 63 1.65 1.72 $1.50 4 1.46 _ 1.37 $1.25 4 ne ae $1.00 + 0.89 $0.75 4 0.72 $0.50 4 0.43 O28 $0.25 + | i $0.00 4 — — — — 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2009 2010 ytd ytd — — : Preferred Stock Impact iSource. . Corporation
Slide 24: Common Dividends per Share
Common Dividends per Share $0.70 5 $0.60 4 0.58 9.59 053 58 $0.50 4 0.45 $0.40 4 0.38 0.30 0:32 0.33 Ose 0.30 $0.30 4 2 : $0.20 4 $0.10 4 $0.00 +o Fo Fe Fe Pe 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 << Compound Growth Rate: 7.57% pif Soeebine .
Slide 25: Why Invest in 1st Source?
Why Invest in 1st Source? Source. __ iCorporation
Slide 26: Why 1st Source?
Why 1st Source? Strongly capitalized with TARP — Estimated without TARP + Risk-based capital Tier 1 16.58% 13.45% + Risk-based capital —total 17.87% 14.74% Stable credit quality, strongly reserved + 2.81% loan loss reserve + NPAs mainly collateralized Diversification of income mix + 37% of net reven
Slide 27: Why 1st Source?
Why 1st Source? Dominant local market share Improving cost efficiencies Recently improving margins Historically consistent and growing dividend Source. __ — ——_ bei Corporation
Slide 28: Why 1st Source?
Why 1st Source? « No sub-prime exposure « No highly inflated real estate markets * Majority of commercial real estate lending is owner occupied Source. __ — ——_ bei Corporation
Slide 29: Why 1st Source? The Top Performers
Why 1st Source? The Top 150 Performers + #8 —- 2010 Bank Performance Scorecard + Bank Director Magazine, banks over $3.0 billion + Based on Profitability, Capital Adequacy, and Asset Quality + Up from # 30 in 2009, # 43 in 2008 and # 65 in 2007 KRY Five-Star Rating from Bauer Financial + Highest rat
Slide 30: Why 1st Source? Most Trustworthy Public Companies
Why 1st Source? 100 Most Trustworthy Public Companies Forbes, April 2009 Selected out of 12,000 publicly traded companies Recognized for transparent and conservative accounting practices, solid corporate governance and management, according to rankings compiled by Audit Integrity. “These companies d
Slide 31: Contact Information
Contact Information ¢ 1st Source common stock is traded on the NASDAQ Global Select Market under “SRCE” ¢« Website: www.1stsource.com ¢ Investor Relations: Melissa Collins 574-235-2495 <= Source. __ — ——_ bei Corporation
Slide 32: Questions?
Questions? Source. __ i Corporation