Provident Financial Services, Inc · NYSE:PFS
Provident Financial Services — Ryan, Beck & Co. Financial Institutions Investor Conference 2004
19 slides from Provident Financial Services's conference presentation, Oct 27, 2004
Slide 1: Driving Revenue by Building Commercial Lending Capability
Exhibit 99.1 Ryan, Beck & Co. Financial Institutions Investor Conference Wednesday, October 27, 2004 Driving Revenue by Building Commercial Lending Capability 1
Slide 2: Forward Looking Statements
Forward Looking Statements Certain statements contained herein are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such forward-looking statements may be identified by reference to a future period or
Slide 3: Strategic Business Drivers
Strategic Business Drivers Long-range Strategic Goal: Achieve and sustain 50-50 Mix of Commercial and Retail Loans Concentrated emphasis on building market share in middle-market C & I lending (ideal borrower size: $20 million in sales) Emphasis on multi-family and single-family Construction lending
Slide 4: Competing in the Commercial Lending Arena: A Continual Building Process
Competing in the Commercial Lending Arena: A Continual Building Process Continued Building of Lending Team & Talent Market Penetration and Expansion Constant Focus on Credit Standards and Asset Quality Steady Portfolio Growth Dedicated to Building Total Relationships with Commercial Customers 4
Slide 5: Building Team & Talent
Building Team & Talent 11 Commercial Lending Vice Presidents 6 C&I /Small Business 4 Commercial R.E. 1 CLO 17.4 years average commercial lending experience Commercial Lending Vice Presidents 7 C&I /Small Business 9 Commercial R.E. 1 CLO 17.8 years average commercial lending experience 5
Slide 6: Building Market Recognition & Reach
Building Market Recognition & Market Reach Lending Area = entire State of New Jersey We have achieved State-wide reputation as a Commercial Real estate lender Continually building reputation as a C & I lender Large borrowers think of us as a resource as rapidly as they do much larger institutions Ac
Slide 7: Current Geographic Footprint
Current Geographic Footprint Loan Center Woodbridge, NJ Corporate HQ Jersey City, NJ 77 Branches in 10 Counties
Slide 8: Origination Standards—Commercial & Industrial Loans
Origination Standards— Commercial & Industrial Loans Majority of loans are floating rate Some fixed interest for 5 years or less Less than $100,000—use Fair Isaac credit score system Largest credit = $35 million participation in $400 million syndicated line of credit 8
Slide 9: Origination Standards—Construction Loans
Origination Standards— Construction Loans Terms of 3 years or less Outside engineering firm reviews plans & costs and construction advances Conditions of advances: For rental property, require significant pre-leasing For single-family or condo projects, significant percent of units must be under con
Slide 10: Origination Standards—Commercial R.E. & Multi-family
Origination Standards— Commercial R.E. & Multi-family 75% maximum LTV 1.2X minimum debt service coverage Rate adjusted after 5 years Property inspection every 18 months for loans $1 million + Largest single loan: $25 million secured by hotel ($5 million recently participated out) 10
Slide 11: Maintaining a Diversified Loan Portfolio
(1) 1-4 Family Mortgages and all Consumer Loans (2) Commercial (C & I), Commercial R.E., Multi-Family, Construction and Mortgage Warehouse Loans Maintaining a Diversified Loan Portfolio Relative percentage of Total Loan balances outstanding as of period-end 55.45 44.55 47.52 52.48 60.2 39.8 58.6 41.
Slide 12: Diversified Loan Portfolio; Managing Interest Rate Risk
Maintaining a Diversified Loan Portfolio Managing Interest Rate Risk PFS Net Interest Margin v. Prime Rate 10.00 9.00 8.00 7.00 6.00 5.00 4.00 3.00 2.00 1.00 0.00 Dec-00 Dec-01 Dec-02 Dec-03 Current Prime Rate 9.5 4.75 4.25 4 4.75 PFS-NIM 3.7 3.97 3.96 3.37 3.39 Relative percentage of Total Loan Inc
Slide 13: Portfolio Growth—Commercial & Industrial Loan Portfolio
Portfolio Growth—Near-term Performance: Commercial & Industrial Loan Portfolio ($ in millions) Outstanding Balance at period-end Interest Income for period Note: Annualized income at 6/04 excludes effect of First Sentinel acquisition completed 7/14/04 0 50 100 150 200 250 300 350 Bal. 141.5 190 250.
Slide 14: Portfolio Growth—Construction Loan Portfolio
Portfolio Growth—Near-term Performance: Construction Loan Portfolio ($ in millions) Outstanding Balance at period-end Interest Income for period Note: Annualized income at 6/04 excludes effect of First Sentinel acquisition completed 7/14/04 0 20 40 60 80 100 120 Bal. 80.7 96 99.1 115 Dec.,2001 Dec.,
Slide 15: Portfolio Growth—Non-Residential R.E. & Multi-Family Portfolios
Portfolio Growth—Near-term Performance: Non-Residential R.E. & Multi-Family Portfolios ($ in millions) Outstanding Balance at period-end Interest Income for period 40 38 36 34 32 30 2001 2002 2003 6/04-Annlzd Int. Inc. 38.1 38.3 35.8 36.4 Note: Annualized income at 6/04 excludes effect of First Sent
Slide 16: No Compromise on Asset Quality
No Compromise on Asset Quality Consistent commitment to credit quality, regardless of business cycles Consistent underwriting standards & practices Aggressive collection efforts (% Non-Performing Loans to Total Loans) 0.00% 0.05% 0.10% 0.15% 0.20% 0.25% 0.30% 0.35% 0.40% 0.45% June, NPL’s
Slide 17: Building Relationships
Building Relationships Our goal is to obtain a true relationship with the borrower, i.e., maximum share of wallet Loan officers routinely market every product: corporate deposits, personal business, cash management & other services based on customer’s need Commercial clients develop rapport not only
Slide 18: Competitive Advantages
COMPETITIVE ADVANTAGES Responsiveness Flexibility in structure and price Local decision-making No regional bank bureaucracy Exceptional customer service Loyal customer base
Slide 19: Provident Financial Services, Inc.
oe eee PROVIDENT FINANCIAL SERVICES, INC.