First Financial Bancorp. · NASDAQ:FFBC
First Financial Bancorp — Q2 2018 Earnings Presentation
33 slides from First Financial Bancorp's earnings presentation, Aug 7, 2018
Slide 1: Investor Presentation Second Quarter 2018
Investor Presentation Second Quarter 2018
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: 158 Consumer, Business Banking, Small Business Assets: $13.9 billion Mortgage Banking Loans: $8.9 billion Wealth Management
Slide 5: a . lene arte
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Slide 6: 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 7: Revenue Growth Strategies
Revenue Growth St . a pricing strategy + Community ets + Increased Commercial Metro ? = built lending imits Geers ques Sih yes aia «New Consumer product line-up «National '* Connection into CRM platform ‘completion of all items + Treasury Management product Digital + Larger salesforce in targeted in
Slide 8: 2018 Priorities
2018 Priorities . Successful integration of the two companies . Minimal customer disruption/quick recovery . Develop cohesive leadership team and culture that is embraced by our associates . Achieve expense savings and deliver the financial returns we communicated to our shareholders by 1Q 2019 . Ac
Slide 9: Invest with First Financial
Invest with First Financial . Experienced and proven management team . Increased scale to invest in franchise and achieve top quartile financial returns . Proven & sustainable business model . Well managed through the cycle . Conservative operating philosophy . Consistent profitability – 111 consecu
Slide 10: Invest with First Financial: Total Shareholder Return
Invest with First Financial Total Shareholder Return1,2,3,4 138.6% 115.1% 87.4% 83.4% 57.0% 40.3% 17.8% 16.1% 13.6% 9.0% 9.1% 3.9% 5 Year 3 Year 1 Year YTD 2018 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 11: Presentation Contents
Presentation Contents About First Financial Bancorp Financial Performance Appendix 11
Slide 12: 2Q 2018 Highlights
2Q 2018 Highlights 111th Consecutive Quarter of Profitability . Net income = $36.4 million or $0.37 per diluted share. Adjusted net income = $55.6 million or $0.57 per diluted share1,2 . Return on average assets = 1.05%. Adjusted return on average assets = 1.60%1 Profitability . Return on average sh
Slide 13: Adjusted Net Income
Adjusted Net Income 1 The table below lists certain adjustments that we b performance. 2Q 2018 1Q 2018 As Reported Adjusted As Reported Adjusted Net interest income$ 123,979 $ 123,979 $ 75,812 $ 75,812 Provision for loan and lease losses$ 3,735 $ 3,735 $ 2,303 $ 2,303 Noninterest income$ 28,256 elie
Slide 14: Profitability
Profitability Diluted EPS Return on Average Assets $0.57 1.60% $0.52 1.49% $0.45 1.26% 1.11% $0.39 1.06% $0.36 $0.49 1.40% 1.13% 1.13% $0.37 $0.40 $0.40 $0.37 1.06% 1.05% 2Q17 3Q17 4Q17 1Q18 2Q18 2Q17 3Q17 4Q17 1Q18 2Q18 1 1 DilutedEPS Adjusted EPS ROA Adjusted ROA Return on Tangible Common Equity E
Slide 15: Net Interest Margin
Net Interest Margin Net Interest Margin (FTE) 2Q18 NIM (FTE) Progression 4.15% 1Q18 3.84% 0.29% 3.82% 3.84% Merger-related impact -0.04% 0.15% 0.15% 0.24% 3.56% 3.57% Purchase accounting 0.29% 0.15% 0.14% Security yields 0.03% 3.69% 3.71% Loan yields 0.12% NIM 3.58% Expansion 3.41% 3.43% Deposit cos
Slide 16: Interest Rate Sensitivity
Interest Rate Sensitivity Loan Portfolio – Floating Loan Mix (1) . Asset sensitive position 62% 63% 65% 67% 55% . Majority of loans are variable rate: $4,916 . $3,908 $4,099 55% reprice <=3 months $3,639 $3,783 . Securities portfolio duration – 3.6 years . +100 scenario 4.0 years 2Q17 3Q17 4Q17 1Q18
Slide 17: Average Balance Sheet
Average Balance Sheet Average Loans1 Average Deposits 5.50% 0.61% 0.60% 0.53% 0.54% 0.57% 5.02% 5.06% 4.75% 4.79% $8,919 $10,383 21% 21% $5,780 $5,889 $5,940 $6,007 6% $6,570 $6,680 $6,840 $6,903 18% 17% 25% 31% 18% 18% 18% 17% 21% 8% 7% 8% 8% 18% 30% 30% 30% 29% 37% 37% 37% 36% 48% 25% 45% 45% 45%
Slide 18: Loan and Deposit Progressions
Loan and Deposit Progressions 2Q18 EOP Loan Progression 2Q18 Average Deposit Progression First Financial as of March 31 $ 6,102,021 First Financial as of March 31 $ 6,903,312 MainSource as of March 31 3,012,330 MainSource as of March 31 3,462,051 Total as of March 31 9,114,351 Total as of March 31 1
Slide 19: Investment Portfolio
Investment Portfolio . Total EOP investments of approximately $3.2 billion . Investment portfolio / total assets = approximately 23% . Portfolio duration = estimated 3.6 years Portfolio Composition Portfolio Quality FRB/FHLB Stock Other 3% US Treasury/Govt BBB+ BBB Corporate bonds ABS FFELP 3% Other
Slide 20: Loan Portfolio
Loan Portfolio C&I Loans by Industry 1 CRE Loans by Collateral 2 C&I Loans: $3.8B ICRE Loans: $3.1B Residential, 1‐4 Family Other Services Hotel/Motel 6% 5% Strip 11% Other Center Health Care and 25% 8% Nursing/Assisted Social Office Living Assistance 6% 6% 13% Agriculture, Accommodation Warehouse F
Slide 21: Noninterest Income and Noninterest Expense
Noninterest Income and Noninterest Expense Noninterest Income Noninterest Expense 1 2Q18 2Q18 Total $20,991 $5,869 $28.3 million 20% Total 21% $9,568 $102.8 million 34% $2,316 $14,304 $55,531 8% 14% 54% $1,463 $11,929 5% $3,697 12% $5,343 13% 19% Salaries and benefits Occupancy and equipment Service
Slide 22: Asset Quality
Asset Quality Classified Assets / Total Assets Nonperforming Assets / Total Assets 1.13% 1.08% 0.98% 0.98% 1.00% 0.72% 0.60% 0.50% 0.52% 0.46% $139.3 $62.7 $64.2 $52.9 $46.3 $98.4 $94.3 $44.4 $87.3 $87.6 2Q17 3Q17 4Q17 1Q18 2Q18 2Q17 3Q17 4Q17 1Q18 2Q18 Classified Assets Classified Assets / Total As
Slide 23: Capital
Capital Tangible Book Value Per Share Total Capital Ratio 13.36% 13.05% 13.07% 13.17% $11.62 $11.75 12.50% 12.98% $11.07 $11.36 $11.01 2Q17 3Q17 4Q17 1Q18 2Q18 2Q17 3Q17 4Q17 1Q18 2Q18 Tangible Book Value per Share Total Capital Ratio Target Tier 1 Common Equity Ratio Tangible Common Equity Ratio 10
Slide 24: Outlook
Outlook1 . Annualized loan growth expected to be in the low to mid-single digits on a percentage basis Balance Sheet for the remainder of 2018 . Projected to be 3.95% - 4.05% on a FTE basis based on static interest rates . Includes estimated purchase accounting adjustments of 23 basis points Net Int
Slide 25: Presentation Contents
Presentation Contents About First Financial Bancorp Financial Performance Appendix 25
Slide 26: Appendix: Executive Chairman & CEO Roles
Appendix: Executive Chairman & CEO Roles . Claude Davis has assumed the role of Executive Chairman of the board . Three-year term, then transitions to Non-executive Chairman Chairman & . Archie Brown, Jr. serving as President & CEO, member of the board CEO Roles . Jointly leading the company, partne
Slide 27: Appendix: Company Overview Executive Team
Appendix: Company Overview Executive Team Line of Business Leaders . Chief Banking Officer – Anthony Stollings . Commercial Finance – Rick Dennen . Chief Financial Officer – Jamie Anderson . Commercial – Brad Ringwald . Chief Administrative Officer – John Gavigan . Investment Commercial Real Estate
Slide 28: Appendix: Our Markets
Appendix: Our Markets . Greater Cincinnati . Indianapolis . Loans $2.8 billion . Loans $1.0 billion . Deposits $3.1 billion . Deposits $0.7 billion . Deposit Market Share #4 (2.7%) . Deposit Market Share #13 (1.8%) . Banking Centers 53 . Banking Centers 10 . Fortune 500 Companies 9 . Fortune 500 Com
Slide 29: Appendix: Non-GAAP Measures
Appendix: Non-GAAP Measures The Company’s earnings release and accompanying presentation contain certain financial information determined by methods other than in accordance with accounting principles generally accepted in the United States (GAAP). Such non-GAAP financial information should be consi
Slide 30: Appendix: Non-GAAP to GAAP Reconciliation
Appendix: Non-GAAP to GAAP Reconciliation Net interest income and net interest margin - fully tax equivalent Three months ended June 30, Mar. 31, Dec. 31, Sep. 30, June 30, 2018 2018 2017 2017 2017 Net interest income$ 123,979 $ 75,812 $ 75,614 $ 70,479 $ 68,520 Tax equivalent adjustment 1,420 718 1
Slide 31: Appendix: Non-GAAP to GAAP Reconciliation
Appendix: Non-GAAP to GAAP Reconciliation Additional non-GAAP ratios Three months ended June 30, Mar. 31, Dec. 31, Sep. 30, June 30, (Dollars in thousands, except per share data) 2018 2018 2017 2017 2017 Net income (a) $ 36,418 $ 30,506 $ 24,811 $ 24,826 $ 22,736 Average total shareholders' equity 2
Slide 32: Appendix: Non-GAAP to GAAP Reconciliation
Appendix: Non-GAAP to GAAP Reconciliation Additional non-GAAP measures 2Q18 1Q18 4Q17 3Q17 2Q17 (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)$ 123,979 $ 123,979 $ 75,812 $
Slide 33: First Financial Bancorp
fiRST first financial bancorp First Financial Bank First Financial Center 255 East Fifth Street Suite 800 Cincinnati, OH 45202-4248 {1ST ret nent Fe er ie FONE
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