Citizens Financial Group, Inc. · NYSE:CFG
Citizens Financial — Merger or Acquisition (May 2018)
9 slides from Citizens Financial's merger presentation, May 31, 2018
Slide 1: Franklin American Mortgage Company Acquisition
Franklin American Mortgage Company Acquisition Accelerates mortgage banking platform with enhanced scale and efficiency May 31, 2018
Slide 2: Forward-looking statements and use of key performance metrics
Forward-looking statements and use of key performance metrics This document contains forward-looking statements within the Private Securities Litigation Reform Act of 1995. Statements regarding potential future share repurchases and future dividends are forward-looking statements. Also, any statemen
Slide 3: Accelerates strategic fee income initiative in Home Mortgage
Accelerates strategic fee income initiative in Home Mortgage(1) Creates top-15 bank-owned mortgage servicer and originator Highly-regarded, independent mortgage company Accelerates momentum in important fee income and customer-acquisition business Significantly advances mortgage strategy in se
Slide 4: Franklin American Mortgage-at-a-glance
Franklin American Mortgage-at-a-glance(1) Well-diversified, nationwide platform with significant reach and a strong track record of performing through a range of economic cycles 1Q18 annualized originations of $13.7 billion Franklin American Mortgage-at-a-Glance Channel mix Conforming product mix He
Slide 5: Combined mortgage business
Combined mortgage business(1) $s in billions Mortgage servicing portfolio Servicing households Mortgage origination volume(4) (3/31/18) (1Q18) Off balance sheet $78.9B Off balance sheet 415,000 $61.6B $17.3B $19.2B 62,000 353,000 15% 139,000 $20.2B $5.5B 85% 55% 45% CFG Combined Total CFG Combined T
Slide 6: Financially attractive, low-risk transaction
Financially attractive, low-risk transaction(1) $’s millions Mid-teens ROIC, 20%+ IRR and positive contribution of ~45 bps to ROTCE in 2020 Impact to Bloomberg consensus Franklin American Mortgage est. balance sheet items as of 4/30/18 2019 2020 (2) Mortgage loans $ 684 ROTCE ~ 30 bps ~ 45 bps MSR
Slide 7: MSR details as of 4/30/18
MSR details as of 4/30/18 MSR fair market value(1) $63.8 billion combined mortgage servicing portfolio $s in millions $809 Product type Geography PA All Other 8% $550 3% NY 16% 7% 6% MA $259 44% 5% TN $214 5% CA 81% 5% CFG FAMC Combined 4% TX 4% Represents CFG LOCOM valuation 3%3%3%3% OH (2) (2) NC
Slide 8: Key messages
Key messages Strategically compelling transaction ─ Creates top-15 bank owned mortgage servicer & originator ─ Accelerates significant fee income initiative in our home mortgage business with scale in servicing ─ Creates excellent balance sheet leverage through $64 billion servicing portfolio ─ Pr
Slide 9: Citizens Financial Group, Inc.
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