First Community Bankshares, Inc. · NASDAQ:FCBC
First Community Bankshares — First Community Bancshares — Sandler O'Neill + Partners East Coast Financial Services Conference 2011
29 slides from First Community Bankshares's conference presentation, Nov 9, 2011
Slide 1: Sandler O'Neill East Coast Financial Services Conference
Slide 2: Forward-Looking Disclosures
Forward-Looking Disclosures This presentation may include forward-looking statements. These forward- looking statements are based on current expectations that involve risks, uncertainties and assumptions. Should one or more of these risks or uncertainties materialize or should underlying assumptions
Slide 3: First Community Bancshares Overview
First Community Bancshares Overview
Slide 4: Overview
Ovetview QO A $2.2 billion VA, WV, NC and TN branch franchise -Nasdaq Global Select -Russell 3000 Q $829 million Wealth Management Division -$425 million Trust Operation -$404 million RIA O Four-state franchise with solid market share in legacy markets O True retail franchise generating low cost cor
Slide 5: Top Bank
Top 100 Bank USBdNKET upist 2009 Beyond Business as Usual Best of the Bunch 2009 capped the 4" year of recognition as a top 100 bank based on 3-year ROE. ame
Slide 6: Investment Highlights
Investment Highlights 0 138 years of success..... Sin¢e1874 O Attractive Markets QO Superior Efficiency (56% in Q3) QO Exceptional balance sheet profile / Conservative Credit Culture/Disciplined Underwriting O Strong asset quality O Strong non-margin, fee-based revenue diversification 31% of revenue
Slide 7: Top Market Share
Top Market Share Princeton WV 29.48% 2 Bluefield WV 50.49% al Mercer County WV 36.34% 1 Buckhannon WV 31.70% 2 Grafton WV 45.93% 2 Source: 2011 FDIC Summary of Deposits
Slide 8: Investment Highlights
Investment Highlights =» Stable, Low-Cost funding => =» Excess Capital Available =» No TARP or Capital Raise Overhang > Loan Portfolio Performance — Highly granular — average loan balance of $56,000 — Virtually no A&D exposure — Well diversified — Total Delinquency of 2.3% — NPA’s/Total Assets of 1.
Slide 9: Current Franchise: Branch Map locations in WV, VA, NC, TN
Current Franchise: Branch Map 58 locations in WV, VA, NC, TN Mix of urban growth and stable legacy markets Growth targets in NC Piedmont/Triad & Richmond VA and East TN Deposit breakout: - West Virginia $911 million - Virginia $349 million - North Carolina $290 million - Tennessee $ 62 million
Slide 10: Our community is here for you.
Our community is here for you. Ofall the investment opportunities out there, shouldn't you choose the one that offers it all? ‘That’ the power of community.
Slide 11: Strategic Priorities
Strategic Priorities = Substantial growth opportunity = Continue diversification of revenues = Targeted strategic bank acquisitions = Acquisition of small insurance agencies = Fillin primary markets = Populate primary markets "= Attractive price levels = Achieve greater integration with = FDIC-assis
Slide 12: Q3 Strategic Update
Q3 11 Strategic Update => Capital raise =» $19 million convertible preferred offering =» Implied common valuation of $14.49 => Re-aligned GreenPoint Insurance =» Annual revenues decreasing $0.9 million =» Annual expenses decreasing $1.0 million » Positioned DDA offering against big banks for market
Slide 13: Deposit Composition
Deposit Composition September 30, 2011 me I Accounts Balance Demand 33,817 $233,683 0.00% Interest-Beasing Demand 37,806 295,804 0.12% Savings 24,468 396,767 0.15% Total DDA 96,091 926,254 0.10%. Time 14,822 285,675 1.42% Time Jumbo 1,392 274,436 1.68% TRA 4141 69,245 1.68% TRA Jumbo 208 34,881 2.31
Slide 14: September 30, 2011
September 30, 2011
Slide 15: Loan Portfolio: Diversified Portfolio with Strong Loan Quality
Loan Portfolio: Diversified Portfolio with Strong 3% Loan Quality Strong loan quality * NPLs / Loans at September 30, 2011, of 1.81% (Includes TDR’s) Geographically diversified portfolio across the region Highly Granular: + Avg Comm Loan $171 thousand + Avg Retail Loan $36 thousand Top 10 loans in p
Slide 16: Asset Quality Ratios
Asset Quality Ratios Non-Performing Loans / Total Loans Net Charge-Offs / Average Loans 5.00% 4.50% 4.00% 3.50% 3.00% 2.50% 2.00% 1.50% 1.00% 0.50% mFCBC Pee 40% —45en asym 200% a = FCBC & Peer 425% 1.80% 1.60% + a 4 3.34% 1.40% 119% I} 1.20% 107% Live 1.00% ~ 090 0.904 1 218% 20578) 1 943 0.50% ar
Slide 17: Asset Quality Ratios
Asset Quality Ratios Reserves / Non-Performing Loans Reserves / Total Loans 18 if 2.40% = FCBC « Peer | FCBC = Peer 2.25% on 16 nee nase 2% 106 ss 2 es 2.00% 8 1.93% 100 ° 00% re es ee so 1.80% 13 36 wo » a. 1.60% . shone o 140% a 120% m | 1.00% 2005 009 HD QU Qa Qa 2007 = 2008200900 Qa Qa = Through
Slide 18: Summary of 3Q 2011 Earnings
Summary of 3Q 2011 Earnings ‘Three Months Ended Nine Months Ended September 30, September 30, 2011 2010 _ Change 2011 2010 Change Net Interest Income $1774 § 18,597 46% “$53,763 § 55,758 “3.6% Provision for Loan Losses 1920 3,810 49.6% 6611 14,071 __-40.3% ‘Net Interest Income (after provision) 1581
Slide 19: Balance Sheet Summary
Balance Sheet Summary September 30, December 31, 2011 2010 Change Cash & Securities $ 601,089 § = 596,890 0.70% ‘Total Loans 1,378,231 1,390,900 -0.91% Albwance for Loan Losses 26,407 26482 -0.28% ‘Total Loans (net) 1,351,824 1364418 -0.92% Other 267,219 282930 -5.55% Total Assets $ 2,220,092 $ 2,24
Slide 20: Financial Performance Highlights: Efficiency
Financial Performance Hig Efficiency 10% + B22 — «820% 66.63% se _ § 65.00% — 65% ~ 62.27% 60% ~ - , 59.03%) 56.845 58% 50% ~ 1 : 2008 2009 2010 au Qu Q31L = Consistently outperform peer = Trending downward ‘Peers clude pub maded bans with asst betsean $1 and§¢bilioa im NC, SC, East IN, Wand WY (BNC
Slide 21: Financial Performance Highlights: Cost of Funds and Net Interest Margin
Financial Pe ance Highlig tS: Cost of Funds and Net Interest Margin Cost of Funds 282% 7 mFCBC m Peer Bes) 2008 2010 Qn Qn Qn 4.00% 3.78% 3.50% 3.28% 3.00% Net Interest Margin 3.96% mFCBC m Peer 3.90% 3.88% s.50% | | Qin gan) gan 590% | 2010 3.58% 374% 3.39% 5% 2008 = 2009 Highly retail-oriented dep
Slide 22: Attractive Valuations
Attractive Valuations = Using a comparable peer group of high-performing banks based in the Virginias, FCBC is an attractively priced name = Peer group consists of $1 - $10 billion banks in W.Va. and Virginia with TCE > 6% and NPA’s <5% Price/ Price | Leverage TCE/ NPA's/ Reserves/ 2011 Est 2012 Est
Slide 23: Why buy FCBC?
Why buy FCBC? A $2.22 billion VA, WV, NC and TN branch franchise — Robust market share in legacy markets and attractive expansion into growth markets = Positioned as regional consolidator — Growth plan via strategic and opportunistic FDIC-assisted deals = True retail franchise generating low cost co
Slide 24: Why buy FCBC?
Why buy FCBC? = Strong pre-tax, pre-provision core income = Resilient net interest margin of 3.85% for 2011 YTD = Strong non-margin, fee-based revenue diversification = Strong dividend yield at 3.3% = Positioned to emerge as one of the strongest players in the region and build one of the best franch
Slide 25: Supplemental Information
Supplemental Information
Slide 26: Non-GAAP Reconciliation of Core Earnings
Non-GAAP Reconciliation of Core Earnings 5 xA 2007 2008 2009 200 Qi ata ‘Net income available to common shateholders $ 29,632 $ 1,699 $40,856) $ 21,847 § 5,751 § 5597 $ 5,318 Secutities gains G11) 899) 1673273) 83,224) 78) Other-than-temporary impaitments - 29,97 78,863 185 527 - 210 Acquisition gai
Slide 27: Commercial Real Estate Portfolio
Commercial Real Estate Portfolio Legacy wy/ NG Eastem fin Thousands) SwVA sc vA IN Other Total Shopping Centex $907 § 4045 § st $ 340d $$ 18149 Retail Stand Alone 36,908 29,938 12,694 3,666 755 83,961 Office — Medical 6,597 3,876 285 522 : 11,280 Office — Pinfessional 24,990 20,786 26,512 4,896 759
Slide 28: Non-accrual Loans by State
Non-accrual Loans by State 3% West North South ‘Virginia ‘Virginia Carolma Tennessee _Carolina Total fin thonsands) Commexcial & Industsial $ 2 $ 614 $3542 § 122 = 9 4,298 Real Estate - Constmction 167 4 318 i: i" 519 Real Estate - Commercial 660 4,068 2,608 2,212 . 9,548 Real Estate - Residential 1
Slide 29: Contact Information
Contact Information wy . Fist Goreng Heese Inc. 2S First , One Coma Pe Com m u n Ity Bluefield, VA 24605 Bancshares, Inc. For More Information Contact: David D. Brown Chief Financial Officer First Community Bancshares, Inc. (276) 326-9000