First Financial Bancorp. · NASDAQ:FFBC
First Financial Bancorp — Investor Presentation (February 2008)
38 slides from First Financial Bancorp's investor presentation, Feb 26, 2008
Slide 1: First Financial Bancorp February 2008
First Financial Bancorp February 2008 Nasdaq:FFBC
Slide 2: Forward-Looking Statement Disclosure
Forward-Looking Statement Disclosure Certain statements that are not statements of historical fact constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act (the Act). In addition, certain statements in future filings by First Financial with the Securit
Slide 3: Corporate Overview
Corporate Overview Ticker - FFBC (Nasdaq) Market Value - $430 million (as of 2/15/08) Total Assets $3.4 billion
Slide 4: Reorganization Recap
Reorganization Recap Consolidate and streamline our company Restructure balance sheet Exit non-strategic and unprofitable businesses and product lines Upgrade infrastructure Focus on expenses and efficiency Recruit and motivate sales teams Focus on clients and sales growth
Slide 5: Strategic Plan - Timeline
Strategic Plan - Timeline Yield 6.60% Yield 6.60% Yield 6.90%
Slide 6: Our Strategy
Our Strategy
Slide 7: Our Strategy: Lines of Business
Our Strategy Lines of Business Retail Banking Commercial Banking Wealth Management
Slide 8: Our Strategy: Bank Market Strategy
Our Strategy Bank Market Strategy Organized into 8 markets Managed locally by experienced local bankers Supported centrally
Slide 9: Our Strategy: Markets
Dayton / Middletown - OH Butler / Warren County - OH Cincinnati - OH Northern Kentucky Northwest Indiana Northern Ohio North Central Indiana South Central Indiana Our Strategy
Slide 10: Demographic Profile
fiRST first financial bancorp Demographic Profile First Financial Bancorp.) lor Dayton Mietoun 11 976452 385 755.068 830 er S757 = m8 jon iter Warren 19 200700 7390 weg 805 70 53082 ma lox Cncinnat 3. 25902057 015 sopora (420) ats) 0063s 5. ky Kentucky 4 1768208 595 1075 380288. 685 |= asa 2.74 Jor
Slide 11: Launching Our New Brand
Our Strategy Launching Our New Brand Branding ... it's much more than our Company Name It's a demonstration of what we believe and how we help our clients be more successful. It's how our clients feel about their experience with us. Brand ties our mission statement, values, and our strategic plan to
Slide 12: Brand Promises
Brand Promises We promise to always be looking ahead. We promise to keep things simple. We promise to make doing business with us easy for our clients. We promise to be a leader - to constantly innovate and improve our systems and responsive abilities so as to serve the needs of our clients better.
Slide 13: Company Goals
Our Strategy Company Goals Top-quartile performance for all stakeholders Sustained and consistent excellence Commitment to growth Effective management of all risks
Slide 14: Credit Quality
Credit Quality Credit Quality Within estimated range and stable Highlights the success of the restructured credit organization
Slide 15: Current Credit Management System
Current Credit Management System Market-based Centralized Market level
Slide 16: Credit Quality
Credit Quality Remains within a range of acceptability Will continue to actively manage New processes to ensure quality of new loans and manage existing problem credits
Slide 17: Credit Quality
Credit Quality Adjustments made to exclude the effects of loan sales
Slide 18: Acquisition Philosophy
Acquisition Philosophy Primary focus and value creation for the company is organic growth in our key markets Acquisitions can advance market position and accelerate the timing of market share compared to an organic growth only strategy Pricing must be disciplined and favorable compared to the longer
Slide 19: 2007 Financial Performance
2007 financial performance Strong commercial growth Strong net interest margin Improved credit quality Decreasing non interest expense Success To Date
Slide 20: Strong Commercial Growth
Strong commercial growth $244 million in year-over-year commercial loan growth - increase of over 17% Profitable growth with disciplined underwriting and pricing - - emphasizes full relationship Success To Date
Slide 21: Net Interest Margin
Net interest margin Full year 2007 = 3.94% (4.01% fully-tax equivalent) Improving asset mix shift Loan growth is on plan with late start Deposits remain challenging Rate cuts will create headwinds Success To Date
Slide 22: Earning Assets
Earning Assets COMMERCIAL COMMERCIAL 631651 REAL ESTATE - CONSTRUCTION 87576 REAL ESTATE - MORTGAGE 1534656 INSTALLMENT 589817 CREDIT CARD 20353 LEASE FINANCING 4305 Commercial Loans Consumer Loans Retail Mortgages Leasing Investments FFBC 0.5064 0.1445 0.1946 0.0003 0.1535 2006 Average Yield 6.60%
Slide 23: Loan Portfolio
fiRST first financial bancorp Loan Portfolio Loan Portfolio Composition (EOP) ae. 02006 @ 2007 va = 67% via = i 6.5% 3.0% ow El Commercial Commercial RE Residential RE Installment Home Equity
Slide 24: Loan Portfolio Strategy
fiRST first financial bancorp Loan Portfolio Strategy Growth Since 2005 Indirect Installments (69%) Residential Morigages | (30%) (300,000) (200,000) (100,000) 100,000 200,000 300,000 400,000 (80005)
Slide 25: Liability Mix
Liability Mix COMMERCIAL COMMERCIAL 631651 REAL ESTATE - CONSTRUCTION 87576 REAL ESTATE - MORTGAGE 1534656 INSTALLMENT 589817 CREDIT CARD 20353 LEASE FINANCING 4305 Non-Interest Bearing Deposits Interest Bearing Deposit Time Deposits Short-term Debt FHLB Advances Trust Preferred FFBC 13.23 39.96 40.
Slide 26: Deposit Portfolio
fiRST first financial bancorp Deposit Portfolio Deposit Portfolio Compo: 02006 ©2007 an 1.8% 18% 10% Yd} 5% 0% Noninterest Bearing Interest Bearing Time
Slide 27: Success To Date: Non Interest Income
Success To Date Non interest income Diversified with improving trends Improving wealth management services
Slide 28: Non Interest Income
Non Interest Income COMMERCIAL COMMERCIAL 631651 REAL ESTATE - CONSTRUCTION 87576 REAL ESTATE - MORTGAGE 1534656 INSTALLMENT 589817 CREDIT CARD 20353 LEASE FINANCING 4305 Trust and I/A fees Total service charges on deposits Gain on mortgage loan sales Bankcard interchange income Other misc income FF
Slide 29: Success To Date: Decreasing Non Interest Expense
Success To Date Decreasing non interest expense Lowest core expense levels since 2004 Still room for improvement Excess capacity for planned growth Within estimated range
Slide 30: Efficiency
Efficiency 2004 Y 2005 Y 2006 Y 2007 Y GAAP 0.6679 0.7369 0.7671 0.6733 Long Term Target = 55 to 60% Margin compression may have up to a 3% negative impact on 2008
Slide 31: Staff Expense
Staff Expense Number of Full Time Equivalent Personnel
Slide 32: Credit Quality: Success To Date
Credit Quality Success To Date Stable credit quality 2007 annualized net charge-offs of 0.24% ALLL to nonperforming loans of 198% Nonperforming assets to total assets of 0.51%
Slide 33: Capital
Capital Capital Philosophy levels and strategies defined in Capital Plan Dividends increase when sustainable Share Repurchase when prudent
Slide 34: Capital
Capital 2000 2001 2002 2003 2004 2005 2006 2007 2008 Plan FFBC 987.6 1847.5 1839.7 1230.7 408.6 4166 383 2000 0 Modified Dutch Tender Offer repurchase of 3,250,000 shares in December 2005 No repurchases planned for 2008
Slide 35: 2008 Keys to Success
2008 Keys to Success Continued success in commercial lending Begin to show strength in deposit growth Continued credit quality strength Further expense reductions Faster revenue growth
Slide 36: 2008 Risks
2008 Risks Margin - asset sensitive balance sheet Economic slowdown - pressure on credit quality
Slide 37: 2008 Outlook
2008 Outlook Low single-digit growth in loans and deposits Net interest margin compression will continue Expected net charge-off levels between 30 - 40 bps of average loans Modest noninterest income growth Little to no growth in noninterest expense
Slide 38: Leverage Points
Leverage Points New metropolitan markets - success Sales forces expansion - success Efficiency - in process Loan mix shift to commercial - success Wealth Management - in process Strong capital Improved and stable credit quality
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