Slide 1: Old Second Bancorp, Inc. August 2007
Old Second Bancorp, Inc. AUGUST 2007 136TH ANNIVERSARY NASDAQ: OSBC
Slide 2: Presenters and contact details
Bill Skoglund Jim Eccher Chairman, President & CEO Chief Operating Officer Old Second Bancorp, Inc. Old Second Bancorp, Inc. 630-906-5483 630-966-2433
Slide 3: Forward-looking Statements and Non-GAAP Disclosures
Forward-looking Statements In addition to historical information, this presentation contains forward-looking statements, which are subject to certain risks and uncertainties. Forward-looking statements include information concerning possible or assumed future results of Old Second’s operations. Forw
Slide 4: Market area map
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Slide 5: Illinois' Largest Cities (Excluding Chicago)
Illinois’ Largest Cities (Excluding Chicago) as of 7/1/05 98,645 112,685 115,668 136,208 141,600 152,916 168,181 0 20,000 40,000 60,000 80,000 100,000 120,000 140,000 160,000 180,000 Elgin Peoria Springfield Joliet Naperville Rockford Aurora
Slide 6: Illinois' Fastest Growing Cities: Net Gain 2000-2005
Illinois’ Fastest Growing Cities: Net Gain 2000-2005 9,893 (73.4%) 11,929 (207%) 11,984 (21.3%) 12,897 (10%) 14,898 (112.3%) 15,262 (72.2%) 25,073 (17.5%) 29,338 (27.5%) 0 5,000 10,000 15,000 20,000 25,000 30,000 Oswego Huntley Bolingbrook Naperville Plainfield Romeoville Aurora Joliet
Slide 7: Illinois' Fastest Growing Counties by % Population Growth
Illinois’ Fastest Growing Counties by % Population Growth, 2000-2005 (%) and 2005 Population (In Thousands) Source: U.S. Census Bureau 2005 Pop: 80 642 482 304 703 929 5,304 44.1% 26.5% 18.3% 16.2% 8.3% 2.5% -1.4% -10.0% 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% Kendall Will Kane McHenry Lake DuPage Cook
Slide 8: Single Family Construction Building Permits
Single Family Construction Building Permits Source: CityData.com Population (in thousands) 2006 2005 2004 2003 2002 Aurora 168 646 989 843 836 1067 Naperville 142 364 407 481 614 671 Plainfield 13 998 1407 1320 1449 947 Joliet 136 1520 2018 1625 1687 1836 Oswego 13 679 734 620 649 356 Yorkville 6 80
Slide 9: Single Family Construction Building Permits
Single Family Construction Building Permits Source: CityData.com Population (in thousands) 2006 2005 2004 2003 2002 Plano 6 465 678 429 24 2 Sugar Grove 4 174 197 290 293 385 Elburn 3 138 166 173 177 30 Sycamore 12 261 406 247 235 178 DeKalb 39 213 332 165 166 152 Total 64 1251* 1779 1304 895 747 *2
Slide 10: Single Family Construction Building Permits for Cities over 75,000
Single Family Construction Building Permits for Cities over 75,000 in Population Source: CityData.com Population (In Thousands) 2006 2005 2004 2003 2002 Rockford 150 276 347 219 226 280 Peoria 113 240 301 318 291 352 Springfield 111 219 279 366 341 316 Waukegan 88 66 217 76 85 146 Cicero 85 0 0 0 0
Slide 11: NE Illinois Planning Commission Population Forecasts
NE Illinois Planning Commission Population Forecasts (as of 9/27/06) 77.14% 72,888 167,375 94,487 Elgin 666.54% 18,370 21,126 2,756 Elburn 3,217.25% 14,542 14,994 452 Burlington 31.58% 7,536 31,402 23,866 Batavia 33.78% 48,017 190,167 142,150 Aurora (excl. Kend.) 1,505.07% 58,833 62,742 3,909 Sugar
Slide 12: Kane County Deposit Market Share
Old Second Kane County 10.54% 9.49% 9.70% 11.30% 13.41% 15.98% 17.72% 5/3 4.14% 1.70% 8.55% 10.54% 18.44% % Mkt 2005 4.37% 1.67% 8.64% 11.61% 17.97% % Mkt 2004 4.81% 1.59% 9.48% 10.59% 17.34% % Mkt 2003 5.00% 1.68% 8.82% 10.49% 17.21% % Mkt 2002 5.52% 1.55% 8.92% 10.82% 16.19% % Mkt 2001 5.35% 1.52%
Slide 13: Kendall County Deposit Market Share
Old Second Kendall County Deposit Market Share 14.52% 14.36% 13.77% 13.38% 12.79% 12.42% 12.54% Castle 6.15% 7.68% 8.79% 14.27% 33.46% % Mkt 2005 6.06% 7.52% 9.89% 15.49% 32.39% % Mkt 2004 6.69% 7.54% 11.57% 15.93% 30.21% % Mkt 2003 8.09% 7.29% 12.15% 16.38% 28.53% % Mkt 2002 10.03% 7.24% 5.47% 15.6
Slide 14: Total Assets
Total Assets as of period-end 10.8% Average Growth $0 $500 $1,000 $1,500 $2,000 $2,500 $3,000 Millions 2002 2003 2004 2005 2006 Jun-07
Slide 15: Total Loans
Total Loans as of period-end 12.9% Average Growth $0 $200 $400 $600 $800 $1,000 $1,200 $1,400 $1,600 $1,800 $2,000 Millions 2002 2003 2004 2005 2006 Jun-07
Slide 16: Loan Mix
Loan Mix June 2006 June 2007 as of period-end 7% 2% 31% 32% 9% 19% Commercial & Industrial Commercial Real Estate Construction & Development Residential Home Equity Lines Consumer 23% 5% 1% 9% 30% 32%
Slide 17: Net Charge-Offs
Net Charge-Offs The peer group consists of the Midwest banks of $1 billion to $5 billion. to Average Loans -0.05% 0.00% 0.05% 0.10% 0.15% 0.20% 0.25% 0.30% 0.35% 0.40% 1998 1999 2000 2001 2002 2003 2004 2005 2006 Jun-07 OSBC Peer
Slide 18: Non-Performing Loans
Non-Performing Loans The peer group consists of the Midwest banks of $1 billion to $5 billion. to Loans 0.00% 0.20% 0.40% 0.60% 0.80% 1.00% 1.20% 1998 1999 2000 2001 2002 2003 2004 2005 2006 Jun- 07 OSBC Peer
Slide 19: Total Deposits
Total Deposits 9.6% Average Growth as of period-end $0 $500 $1,000 $1,500 $2,000 $2,500 Millions 2002 2003 2004 2005 2006 Jun-07
Slide 20: Deposit Mix
Deposit Mix June 2006 June 2007 as of period-end 13% 21% 14% 31% 15% 6% Noninterest- bearing Savings NOW Accounts Money Market CD's less than $100,000 CD's $100,000 or more 12% 29% 18% 11% 25% 5%
Slide 21: Net Interest Margin
Net Interest Margin Reconciliations of non-GAAP disclosures are available in public filings linked at oldsecond.com. The peer group consists of the Midwest banks of $1 billion to $5 billion. 0.0% 1.0% 2.0% 3.0% 4.0% 5.0% 2003 2004 2005 2006 Jun-07 OSBC Peer
Slide 22: Return on Equity
Return on Equity The peer group consists of the Midwest banks of $1 billion to $5 billion. 0% 5% 10% 15% 20% 25% 2003 2004 2005 2006 Jun-07 OSBC Peer
Slide 23: Earnings Per Share
Earnings Per Share 9.3% Average Growth Diluted Basis $0.00 $0.50 $1.00 $1.50 $2.00 $2.50 2001 2002 2003 2004 2005 2006
Slide 24: Peer Comparison
Peer Comparison Midwest: Banks with assets between $1 billion and $5 billion in Midwest. Illinois: Publicly-traded bank holding companies in Illinois. National $1-$5b: Banks with assets between $1 billion and $5 billion. 0.16% 0.25% 0.20% 0.00% Charge-offs/Avg. Loans 0.68% 1.15% 1.04% 0.26% NPL % of
Slide 25: Stock Comparison
Stock Comparison 58.74% 51.88% 30.96% -40% -20% 0% 20% 40% 60% 80% 100% Jun-02 Sep-02 Dec-02 Mar-03 Jun-03 Sep-03 Dec-03 Mar-04 Jun-04 Sep-04 Dec-04 Mar-05 Jun-05 Sep-05 Dec-05 Mar-06 Jun-06 Sep-06 Dec-06 Mar-07 Jun-07 OSBC Nasdaq Banks S&P 500
Slide 26: Strategic Business Initiatives
Strategic Business Initiatives 1) Trust Preferred/Tender Offer 2) Headcount reductions resulting in 8% cut in salaries and benefits 3) Eliminated pension costs 4) Consolidation of bank charters 5) Slowed de novo branch expansion in 2007 6) Implemented new tax strategy 7) Merged O2 Mortgage into bank
Slide 27: Strategic Objectives
Strategic Objectives CLIENT FOCUS OBJECTIVE Expand Market Share *Continue to focus on attracting, in Branch Footprint retaining and developing top level talent Wealth Management *Expand Wealth Management through organic growth -Asset Management/Trust Services -Private Banking -Financial Planning/Bro
Slide 28: Strategic Objectives
Strategic Objectives CLIENT FOCUS OBJECTIVE Retail Banking *Expand household penetration (Generated over 1100 new households in 2006) *Increase core deposits (Opened record total of 7500 new checking accounts) *Launched quality control program to improve customer service. Mortgage Banking *Implement