First Financial Bancorp. · NASDAQ:FFBC
First Financial Bancorp — Investor Presentation (September 2019)
35 slides from First Financial Bancorp's investor presentation, Sep 3, 2019
Slide 1: Investor Presentation Second Quarter 2019
Investor Presentation Second Quarter 2019
Slide 2: Forward Looking Statement Disclosure
Forward Looking Statement Disclosure Certain statements contained in this report which are not statements of historical fact constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as ‘‘believes,’’ ‘‘anticipates,’’ “likely,” “expec
Slide 3: Presentation Contents
Presentation Contents About First Financial Bancorp Financial Performance Appendix 3
Slide 4: Company Overview
Company Overview Overview Lines of Business Founded: 1863 Commercial Headquarters: Cincinnati, Ohio C&I, O-CRE, ABL, Equipment Finance, Treasury Retail Banking Banking Centers: 159 Consumer, Business Banking, Small Business Assets: $14.4 billion Mortgage Banking Loans: $9.0 billion Wealth Management
Slide 5: Current Priorities
Current Priorities Achieve targeted income and balance sheet growth objectives Develop / begin implementation of strategic technology roadmap Execute acquisition strategy Prioritize fee based businesses: wealth, capital markets In-market bank acquisitions that provide improved market share or niche
Slide 6: Bannockburn Transaction Overview
Bannockburn Transaction Overview First Financial will acquire Cincinnati based Bannockburn Global Forex, LLC (“BBFX”), a capital markets firm specializing in foreign exchange payments, hedging, and other fee- based advisory services to small and medium enterprise (“SME”) clients Highly-additive tran
Slide 7: 4th & Vine – Opened 8/12/19
4th & Vine – Opened 8/12/19 New 15,000 sq. ft. First Innovation Center and Downtown Cincinnati Banking Hub Site Multi-use spaces free for the community including multiple conference rooms, areas for shared workspace, and 5,000 sq. ft. for seminars and events Financial wellbeing tech table Office/wor
Slide 8: Capital Strategy & Deployment
Capital Strategy & Deployment Tangible Book Value Per Share Strategy & Deployment 2Q19 share repurchase inactivity $12.79 primarily due to previously announced Bannockburn acquisition $12.19 $11.72 Board of directors approved $0.01 $11.25 $11.01 increase in dividend to $0.23; results in a 3.8% divid
Slide 9: Product & Pricing
Product & Pricing Regional pricing strategy « Treasury Management product investments ¢ Investments in Product Management Talent Expansion Up-Market Commercial talent acquisition « Added Chief Digital Officer; building out team « Added Enterprise Product Executive « Added Client Experience Executive
Slide 10: Commercial Banking and Wealth Management
COMMERCIAL BANKING ‘To be known and operate asthe Premier Business Bank and to provide banking ‘solutions to the business, to the owner(s) and to their employees. Audience Current Portfolio . (Demander ‘Approx 500 Relationships: * S10MM-100MM Sales Revenue oe ‘Commitments, © 50+ Employees: ($1.18 Bu
Slide 11: Market Centric Strategies
Market Centric Strategies METRO MARKETS COMMUNITY MARKETS HEADQUARTERS NATIONAL Louisville, KY Southeastern IN Columbus, OH South Central IN Greater Cincinnati Industry Specific Indianapolis, IN Northwest IN Northern KY Dayton, OH Northern OH th Low brand awareness High brand awareness 4 in market s
Slide 12: Invest in First Financial
Invest in First Financial Experienced and proven management team Increased scale to invest in franchise Proven & sustainable business model Well managed through the cycle Conservative operating philosophy Consistent profitability – 115 consecutive quarters Top quartile performer – ROAA, ROATCE, Effi
Slide 13: Invest in First Financial: Total Shareholder Return
Invest in First Financial Total Shareholder Return1,2,3,4 67.5% 64.1% 50.5% 40.5% 35.6% 35.4% 19.4% 13.2% 3.9% -3.6% -9.8% -18.5% 5 Year 3 Year 1 Year YTD 2019 FFBC KBW Peer Median KBW Peer Top Quartile 1 Includes dividend reinvestment. 2 Peer group includes KBW regional bank index peers. 3 Based on
Slide 14: Presentation Contents
Presentation Contents About First Financial Bancorp Financial Performance Appendix 14
Slide 15: 2Q 2019 Results
2Q 2019 Results 115th Consecutive Quarter of Profitability Net income = $52.7 million or $0.53 per diluted share. Adjusted1 net income = $57.4 million or $0.58 per diluted share,2. Profitability Return on average assets = 1.50%. Adjusted1 return on average assets = 1.63%. Return on average sharehold
Slide 16: 2Q 2019 Highlights
2Q 2019 Highlights Solid quarterly earnings Adjusted1 earnings per share - $0.58 Adjusted1 return on assets – 1.63% Adjusted1 return on average tangible common equity – 18.87% Net income reduced by $5.2 million of severance and merger related expenses Strong loan growth Loan balances increased $171.
Slide 17: Adjusted Net Income
Adjusted1 Net Income The table below lists certain adjustments that the Company believes is significant to understanding our quarterly performance. 2Q 2019 1Q 2019 As Reported Adjusted As Reported Adjusted Net interest income $ 122,302 $ 122,302 $ 121,515 $ 121,515 Provision for loan and lease losse
Slide 18: Profitability
Profitability Diluted EPS Return on Average Assets 1.64% 1.72% 1.63% $0.61 1.60% $0.57 $0.58 $0.58 1.38% $0.48 1.59% $0.56 1.45% 1.50% $0.51 $0.53 1.33% $0.47 1.05% $0.37 2Q18 3Q18 4Q18 1Q19 2Q19 2Q18 3Q18 4Q18 1Q19 2Q19 1 1 Diluted EPS Adjusted EPS ROA Adjusted ROA Return on Avg Tangible Common Equ
Slide 19: Net Interest Margin
Net Interest Margin Net Interest Margin (FTE) 2Q19 NIM (FTE) Progression 1Q19 4.10% 4.21% 4.15% 4.12% 4.10% 4.04% Asset yield and mix -0.01% 0.29% 0.29% 0.29% 0.23% 0.23% Loan fees 0.01% 0.17% 0.11% 0.15% 0.13% 0.12% Funding costs and mix -0.05% 3.75% 3.76% 3.71% 3.70% 3.69% Purchase accounting 0.01
Slide 20: Average Balance Sheet
Average Balance Sheet Average Loans Average Deposits 5.73% 5.69% 5.53% 5.73% 5.49% 0.78% 0.82% 0.68% 0.57% 0.59% $8,933 $8,849 $8,766 $8,773 $8,853 $10,383 $9,888 $10,050 $10,068 $10,096 2Q18 3Q18 4Q18 1Q19 2Q19 2Q18 3Q18 4Q18 1Q19 2Q19 Gross Loans Loan Yield (Gross)1 Total Deposits Cost of Deposits
Slide 21: Loan Portfolio
Loan Portfolio Loan LOB Mix (EOP) Net Loan Change-LOB (Linked Quarter) Total $9.0 Billion ICRE $189.8 $1,100 Commercial -$21.3 12% 1 $2,950 Small Business Banking -$27.9 $1,065 33% 12% Consumer -$7.3 $884 Mortgage $47.9 10% Commercial Finance -$7.5 $1,221 $1,761 13% 20% Other -$2.1 ICRE Commercial S
Slide 22: Loan Portfolio: C&I and CRE Loans
Loan Portfolio C&I Loans by Industry 1 CRE Loans by Collateral 2 C&I Loans: $3.7B CRE Loans: $3.3B Nursing/Assisted Living Manufacturing Hotel/Motel 7% 11% 13% Strip Center Accommodation Office 6% and Food 15% Services Real Estate Residential, 1-4 15% 11% Family 5% Agriculture 6% Finance and Restaur
Slide 23: Deposits
Deposits Deposit Product Mix (Avg) 2Q19 Average Deposit Progression Total $10.1 billion Interest-bearing demand -$1.4 $1,353 $2,316 13% 23% Public Funds $112.8 $1,565 16% Savings $1.3 $688 7% Money Markets -$74.2 $892 $1,443 9% Retail Time Deposits $41.0 14% $1,839 18% Brokered CDs -$42.9 Interest-b
Slide 24: Investment Portfolio
Investment Portfolio Total EOP investments of approximately $3.4 billion Investment portfolio / total assets = approximately 24% Portfolio duration = estimated 3.0 years Portfolio Composition Portfolio Quality Corporate Non-Agency pass- Debt obligations of U.S. securities, 2% through securities, 3%
Slide 25: Noninterest Income and Noninterest Expense
Noninterest Income and Noninterest Expense Noninterest Income Noninterest Expense1 Total $34.6 million Total $84.4 million $6,042 $15,591 18% $9,819 18% 28% $3,432 $4,984 10% 6% $9,818 $53,985 $4,905 $3,943 12% 64% 14% 11% $6,497 19% Service Charges Wealth Mgmt Salaries and benefits Occupancy and eq
Slide 26: Asset Quality
Asset Quality Classified Assets / Total Assets Nonperforming Assets / Total Assets 1.00% 1.00% 1.01% 1.02% 0.94% 0.63% 0.60% 0.62% $147.8 0.46% 0.47% $139.3 $138.9 $142.0 $131.7 $90.2 $88.2 $83.9 $64.2 $64.6 2Q18 3Q18 4Q18 1Q19 2Q19 2Q18 3Q18 4Q18 1Q19 2Q19 Classified Assets Classified Assets / Tota
Slide 27: Capital
Capital Total Capital Ratio Tier 1 Common Equity Ratio 14.10% 14.24% 14.20% 11.87% 12.03% 12.00% 13.36% 13.77% 11.52% 12.50% 10.50% 11.15% 2Q18 3Q18 4Q18 1Q19 2Q19 2Q18 3Q18 4Q18 1Q19 2Q19 Total Capital Ratio Target Tier 1 Common Equity Ratio Target Tangible Common Equity Ratio 9.15% 9.34% 8.79% 8.5
Slide 28: 3Q19 Outlook
3Q19 Outlook1 Annualized loan growth expected to be in the mid single digits on a percentage Balance Sheet basis NIM (FTE) 3.70 - 3.75%, excluding purchase accounting impact Net Interest Margin Compares to 3.81% in 2Q19 Credit Credit outlook remains stable Noninterest income2 $27 - $29 million Inclu
Slide 29: Presentation Contents
Presentation Contents About First Financial Bancorp Financial Performance Appendix 29
Slide 30: Appendix: Our Markets
Appendix: Our Markets Greater Cincinnati Indianapolis Loans $2.7 billion Loans $1.0 billion Deposits $3.0 billion Deposits $0.7 billion Deposit Market Share #4 (3.2%) Deposit Market Share #14 (1.6%) Banking Centers 54 Banking Centers 10 Fortune 500 Companies 8 Fortune 500 Companies 2 Central OH Loui
Slide 31: Appendix: Non-GAAP Measures
Appendix: Non-GAAP Measures The Company’s earnings release and accompanying presentation contain certain financial information determined by methods other than in accordance with accounting principles generally accepted in the United States (GAAP). Such non-GAAP financial information should be consi
Slide 32: Appendix: Non-GAAP to GAAP Reconciliation
Appendix: Non-GAAP to GAAP Reconciliation Net interest income and net interest margin - fully tax equivalent Three months ended June 30, Mar. 31, Dec. 31, Sep. 30, June 30, 2019 2019 2018 2018 2018 Net interest income $ 122,302 $ 121,515 $ 125,959 $ 123,485 $ 123,979 Tax equivalent adjustment 1,416
Slide 33: Appendix: Non-GAAP to GAAP Reconciliation
Appendix: Non-GAAP to GAAP Reconciliation Additional non-GAAP ratios Three months ended YTD June 30, Mar. 31, Dec. 31, Sep. 30, June 30, June 30, June 30, (Dollars in thousands, except per share data) 2019 2019 2018 2018 2018 2019 2018 Net income (a) $ 52,703 $ 45,839 $ 55,014 $ 50,657 $ 36,418 $ 98
Slide 34: Appendix: Non-GAAP to GAAP Reconciliation
Appendix: Non-GAAP to GAAP Reconciliation Additional non-GAAP measures 2Q19 1Q19 4Q18 3Q18 2Q18 (Dollars in thousands, except per share data) As Reported Adjusted As Reported Adjusted As Reported Adjusted As Reported Adjusted As Reported Adjusted Net interest income (f) $ 122,302 $ 122,302 $ 121,515
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