Associated Banc-corp · NYSE:ASB
Associated Banc-corp — IPO Roadshow (January 2010)
33 slides from Associated Banc-corp's IPO roadshow presentation, Jan 11, 2010
Slide 1: Investor Presentation January 2010
Investor Presentation January 2010
Slide 2: Important note regarding forward-looking statements
Statements made in this presentation which are not purely historical are forward-looking statements, as defined in the Private Securities Litigation Reform Act of 1995. This includes any statements regarding management's plans, objectives, or goals for future operations, products or services, and fo
Slide 3: Key offering terms
Key offering terms Issuer: Associated Banc-Corp ("ASBC") Offering type: Primary offering of common stock Total amount offered: $400 million Over-allotment option: 15% Use of proceeds: Fortify capital ratios, general corporate purposes Lockup: 90 days Sole book-runner: Credit Suisse (USA) Securities
Slide 4: Repositioning Associated for the future
Repositioning Associated for the future New CEO, Philip Flynn, formerly of UnionBanCal We have taken a hard look at credit and increased the allowance to what we believe to be appropriate for the current loan portfolio and economic conditions Provision of $395mm, charge-offs of $234mm and an increas
Slide 5: New management team proactively addressing credit
New management team proactively addressing credit Management changes Philip B. Flynn - President and Chief Executive Officer (December 2009) Vice Chairman and Chief Operating Officer of Union Bank, San Francisco (2005-2009) Other executive positions of Union Bank include Chief Credit Officer (2000-2
Slide 6: Capital raise enhances balance sheet strength
Capital raise enhances balance sheet strength TCR Tier 1 Risk-Based Leverage Total Capital Source: SNL Financial for peer data. Note: (1) Pro forma for $400mm raise, net of underwriting discount and offering expenses, but before overallotment. (2) Peers consist of CBSH, CMA, FHN, FMER, HBAN, MBFI, M
Slide 7: Building a strong capital base
Building a strong capital base Note: (1) Well-capitalized levels are 6% for Tier 1, 5% for Leverage and 10% for Total Capital. (2) Does not reflect potential tax benefit from credit losses incurred. (3) Pro forma for $400mm raise, net of underwriting discount and offering expenses, but before overal
Slide 8: Allowance level adds to balance sheet strength
Allowance level adds to balance sheet strength ALLL / total loans ALLL / (past due & non-performing loans) Note: (1) Past due and non-performing loans include loans 30-89 days past due, loans 90 days or more past due and still accruing, restructured loans and nonaccrual loans. (1)
Slide 9: Largest branch network in Wisconsin
Largest branch network in Wisconsin Top 5 deposit market share in 14 MSAs 291 branches $23 billion in assets $14 billion in loans $17 billion in deposits Associated - attractive Midwest footprint Minneapolis 27 branches $1.8bn deposits #6 market share Chicago 27 branches $1.7bn deposits #24 market s
Slide 10: Attractive core deposit growth
Attractive core deposit growth Total deposits Deposit mix - December 2009 (%) ($ in billions)
Slide 11: Stable revenue generation throughout current crisis
Stable revenue generation throughout current crisis Core pre-provision revenue ($ in millions)
Slide 12: Significant non-interest income generation
Significant non-interest income generation Quarterly non-interest income Annual non-interest income ($ in millions) ($ in millions) Note: Non-interest revenue excludes gains / losses in assets and investments.
Slide 13: Core non-interest expense remains well controlled
Core non-interest expense remains well controlled Quarterly non-interest expense Annual non-interest expense ($ in millions) ($ in millions) Recent uptick driven by credit-related charges and increased FDIC insurance costs Personnel Other Credit-related FDIC expense
Slide 14: Credit overview
Credit overview & associated Banc-Corp
Slide 15: Proactively addressing credit issues
Proactively addressing credit issues Enhanced risk management practices Established Board-level Risk and Credit Committee and a bank level Credit Risk Management Committee to globally address credit risk Substantive expansion of credit policies Narrowed footprint definition to primary markets of Wis
Slide 16: 4Q provision expense
4Q provision expense Provision components $233.8 Charge-offs $68.4 Increased provision on existing non-performing loans (FAS 114) $55.7 Increased qualitative reserves - management factors $36.9 Ratings migration (FAS 5) $394.8 Total 4Q'09 provision Drivers of increased provision New appraisal values
Slide 17: Loan portfolio composition
Loan portfolio composition Total loans Loan mix - December 2009 (%) C&I CRE Construction Residential Home Equity Consumer ($ in billions)
Slide 18: High quality / low risk securities portfolio
High quality / low risk securities portfolio Investment portfolio - December 31, 2009 Market value composition - December 31, 2009 Portfolio composition ratings - December 31, 2009 (1) Note: (1) Reflects taxable equivalent yield. ($ in millions) ($ in millions)
Slide 19: Allowance coverage ratios & credit statistics
Allowance coverage ratios & credit statistics Source: SNL Financial for peer data. Note: (1) Peers consist of CBSH, CMA, FHN, FMER, HBAN, MBFI, MI and TCB. (2) Past due and non-performing loans include loans 30-89 days past due, loans 90 days or more past due and still accruing, restructured loans,
Slide 20: Total nonperforming loans
Total nonperforming loans Total NPLs NPL mix - Q4'09 (%) C&I CRE Construction Residential Home Equity Consumer NPL / Loan Category (%) C&I CRE Construction Residential Home Equity Consumer 2.3% 1.8% 4.0% 2.0% 1.1% 0.9% 2.4% 2.8% 6.8% 2.4% 1.3% 0.8% 4.7% 4.4% 13.5% 3.2% 1.4% 0.9% 6.2% 5.5% 18.7% 4.3%
Slide 21: Total net charge-offs
Total net charge-offs Total NCOs NCO mix - Q4'09 (%) C&I CRE Construction Residential Home Equity Consumer ($ in millions) Of the $234mm of Q4'09 charge-offs, 71% of the NCOs were construction and CRE related Construction losses were spread across all asset classes: condominium (21%), land (19%), of
Slide 22: Shared National Credit book
The total Shared National Credit ("SNC") book is $988mm at December 31, 2009 Strategic decision to move away from large, widely syndicated SNCs in favor of smaller, "club"-type deals with local participants where we can provide meaningful credit and non-credit services The core, internally generated
Slide 23: Summary
Summary & associated Banc-Corp
Slide 24: Looking ahead
New management Intensive credit review to identify losses inherent in the portfolio and maintain an allowance appropriate for the difficult economic conditions Equity offering and dividend cut strengthen capital levels and better position Associated for success as we emerge from the credit cycle Cor
Slide 25: Appendix - credit details
Appendix - credit details & associated Banc-Corp
Slide 26: Residential housing price data
Residential housing price data Residential mortgage geography - December 2009 Residential mortgages ($1.9 billion or 14% of Loans at 12/31/09) Note: (1) Data from Office of Federal Housing Enterprise Oversight (OFHEO), Q3'08 to Q3'09. (2) Milwaukee, West Allis, Waukesha. (3) Chicago, Naperville, Jol
Slide 27: Home equity geography
Comments Home equity geography - December 2009 Home equity ($2.5 billion or 18% of Loans at 12/31/09) NCO geography Tightened LTV policies and implemented risk-based pricing Centralized appraisals, override policy and income verification review Significantly upgraded our analysis, collection and loa
Slide 28: Commercial real estate loans
Comments CRE by state CRE by collateral Commercial real estate ($3.8 billion or 27% of Loans at 12/31/09) Shared National Credit outstanding of $41mm of which 40% are non-performing while the core portfolio of $1.1bb has 8% non-performing Q4 large charge-offs categories within CRE related to Retail
Slide 29: Construction loans
Construction loans ($1.4 billion or 10% of loans at 12/31/09) Comments Construction loans by state Construction loans by collateral Shared National Credit outstanding of $251mm with 54% non-performing versus the core portfolio 24% level Q4 larger charge-offs within Construction were Condominium (21%
Slide 30: C&I loans
C&I loans ($3.5 billion or 25% of loans at 12/31/09) Comments C&I loans by state C&I loans by collateral Note: C&I includes commercial, financial & agricultural and lease financing. Shared National Credit outstanding of $696mm with 9% non-performing versus the core portfolio of $2.9bn at 7% non-perf
Slide 31: Appendix - financial details
Appendix - financial details
Slide 32: Quarterly financial highlights
Quarterly financial highlights (2) Source: SNL Financial, company filings. Note: (1) Net income (loss), prior to preferred dividends. (2) Excludes asset sale gains. (1)
Slide 33: Annual financial highlights
Annual financial highlights (2) Source: SNL Financial, company filings. Note: (1) Net income (loss), prior to preferred dividends. (2) Excludes asset sale gains. (1) The issuer has filed a registration statement (including a preliminary prospectus supplement dated January 11, 2010 and an accompanyin