Fifth Third Bancorp · NASDAQ:FITB
Fifth Third Bancorp — Sanford C. Bernstein & Co. Strategic Decisions Conference 2005
27 slides from Fifth Third Bancorp's conference presentation, Jun 2, 2005
Slide 1: Positioning for Better Performance
Exhibit 99.1 Sanford C. Bernstein & Co. Strategic Decisions Conference “Positioning for Better Performance” George A. Schaefer, Jr. President Chief Executive Officer R. Mark Graf Senior Vice President Chief Financial Officer June 2, 2005
Slide 2: Affiliate Banking
Affiliate Banking I. Affiliate Operating Model II. Markets III. Deposit Performance IV. Loan Performance
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 Chicago Western Michigan Florida Detroit Columbus Cleveland Dayton Toledo Indianapolis Southern Indiana Louisville Northern Kentucky Northern Michigan Nashville Lexington Ohio Vall
Slide 4: 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 Detroit, MI Tampa, FL Cleveland-Lorain, OH Cincinnati, OH-KY-IN Orlando, FL Columbus, OH Indianapolis, IN Nashville, TN Lou
Slide 5: Improving Deposit Performance
Improving Deposit Performance 2004 average transaction deposit growth of 7% compared to 13% in the prior year Average Transaction Deposits $ Millions 50,000 45,000 40,000 35,000 30,000 25,000 2001 Q4-03 Q1-04 Q2-04 Q3-04 Q4-04 Q1-05 26,363 41,851 41,397 42,287 43,861 45,126 47,518 15%* 12%* 22%* * A
Slide 6: Demonstrated Long-Term Track Record
Demonstrated Long-Term Track Record $ Millions 35,000 30,000 25,000 20,000 15,000 10,000 5,000 1996 1997 1998 1999 2000 2001 2002 2003 2004 Avg Demand & NOW 5-year CAGR Interest Checking 18% Demand Deposits 15% 5-year CAGR Loans & Leases 8% Earning Assets 9% $ Millions 95,000 85,000 75,000 65,000 55
Slide 7: Affiliate Loan Performance
Affiliate Loan Performance 40% 35% 30% 25% 20% 15% 10% 5% 0% Florida Nashville Lexington OH Valley Chicago Cleveland Indianapolis Detroit Columbus 2004 Average Total Loan & Lease Growth Nine affiliates grew loans by more than 10% in 2004 9% growth in average loans & leases in 2004 $ Millions 55,000
Slide 8: Business Lines
Business Lines 2004 Revenues Processing Solutions 11% Retail 51% Investment Advisors 10% Commercial 28% Processing revenues exclude gain-on-sale
Slide 9: Retail Banking
Retail Banking “Positioned for Better Performance in 2005…” I. Retail Deposit Strategy II. Initiatives III. Small Business IV. The Opportunity
Slide 10: Investing In a Retail Franchise
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 6 6 6 4 4 4 4 4 3 3 2 155 new banking centers opened from Jan 2002 th
Slide 11: Driving Deposit Growth
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 Right price Right product
Slide 12: Substantial Small Business Growth Opportunity
Substantial Small Business Growth Opportunity Small Business Checking Performance 16,000 14,000 12,000 10,000 8,000 6,000 4,000 2,000 - 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0% Bubble Size Represents Market Businesses 100K - 5MM Chicago West MI 12% = Median Cincinnati Detroit Columbus Ind
Slide 13: Commercial Banking
Commercial Banking “Hitting on All Cylinders…” I. Revenue & Net Income Performance II. Loan Performance III. Deposit Performance IV. Credit Performance
Slide 14: Commercial Banking Performance
Commercial Banking Performance $ Millions 1,700 1,600 1,500 1,400 1,300 1,200 1,100 1,000 2002 2003 2004 700 650 600 550 500 450 400 $ 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
Slide 15: Superior Commercial Loan Growth
Superior Commercial Loan Growth 30% 25% 20% 15% 10% 5% 0% Florida Lexington OH Valley Indianapolis Chicago Nashville Louisville Detroit N. Mich. Toledo 2004 Average Commercial Loan & Lease Growth 10 affiliates grew commercial loans by more than 10% in 2004 6 affiliates grew by more than 20% in 2004
Slide 16: Commercial Deposit Focused
Commercial Deposit Focused 60% 50% 40% 30% 20% 10% 0% Florida Cleveland Cincinnati Chicago Columbus Nashville Indianapolis S IN Detroit Lexington Dayton 2004 Average Commercial Demand Deposit Growth 11 affiliates grew commercial demand deposits by 20% or more Commercial demand deposits increased by
Slide 17: Superior Credit Culture
Superior Credit Culture NPAs / Loans & OREO Percent 1.2 1.1 1 0.9 0.8 0.7 0.6 0. 0.5 0.4 0.3 0.2 2Q02 3Q02 4Q02 1Q03 2Q03 3Q03 4Q03 1Q04 2Q04 3Q04 4Q04 1Q05 1.13 1.14 1.09 1.1 1.04 0.99 0.88 0.81 0.69 0.64 0.6 0.57 0.61 0.58 0.61 0.53 0.55 0.59 0.55 0.52 0.49 0.5 0.52 0.48 Fifth Third Top 25 Bank Av
Slide 18: Fifth Third Processing Solutions
Fifth Third Processing Solutions “A Growth Story…” I. Business Mix II. Revenue History III. 2005 Initiatives
Slide 19: Total FTPS Revenue Mix
Total FTPS Revenue Mix FTPS Revenue Financial Institution Merchant Services Card Services TOTAL 2002 $206 261 76 $543 2003 $216 306 87 $609 2004 $250 305* 102 $657 Card Services 16% Financial Institution 38% Merchant Services 46% * Includes 2004 impact of sold contacts totaling $70 million in compar
Slide 20: FTPS Revenue History
FTPS Revenue History $ Millions 750 650 550 450 350 250 150 50 1999 2000 2001 2002 2003 2004 Compound Annual Growth Rate 5-year = 26% 657* * Includes 2004 impact of sold contacts totaling $70 million in comparable lost annual revenue Fin. Inst. & Card Merchant
Slide 21: 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 22: Investment Advisors
Investment Advisors “Refocused, Realigned and Positioned for Growth” I. Business Mix & Accomplishments II. Revenue and Net Income Performance III. 2005 Initiatives
Slide 23: Fifth Third Investment Advisors
Fifth Third Investment Advisors 2004 Revenues Private Client 64% Asset Mgmt 4% Retail Brokerage 16% Institutional 16% 2004 Accomplishments 15% revenue growth compared to 4% expense growth 10 affiliates with greater than 50% net income growth
Slide 24: Turning the Corner
Turning the Corner… Investment Advisors Performance $ Millions 600 500 400 300 200 2002 2003 2004 150 125 100 75 50 $ Millions Revenue Net Income 15% revenue growth & 49% net income growth in 2004 Sales force and product set largely in place Incentives aligned with performance Enhanced profitability
Slide 25: 2005 Initiatives
2005 Initiatives Expand sales of investment management nationally through Fifth Third Asset Management (FTAM) Taft-Hartley, Corporate and Public pension client focus Penetrate commercial and small business client base with 401K Retirement Plans Continued Expansion of Private Client and Retail Broker
Slide 26: The Deposit Opportunity
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 0% 5% 10% 15% 20%
Slide 27: Questions
Questions 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
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