Wesbanco, Inc. · NASDAQ:WSBC
Wesbanco — Macquarie Conference 2010
28 slides from Wesbanco's conference presentation, Jun 15, 2010
Slide 1: Macquarie Conference, June 15-16, 2010
Macquarie Conference June 15-16, 2010 New York, NY
Slide 2: Forward Looking Statements
Forward-Looking Forward Looking Statements Forward-looking statements in this presentation relating to WesBanco’s plans, strategies, objectives, expectations, intentions and adequacy of resources, are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995
Slide 3: WesBanco at a Glance
WesBanco at a Glance • Headquarters in Wheeling, West Virginia • Assets: $5 $5.4 4 billion • Founded in 1870 • 32 banks/23 companies acquired in 25 years • Banking operations in West Virginia, Ohio and Western Pennsylvania 114 banking offices + Pittsburgh, PA Loan Office 136 ATM’s • Non-bank Non
Slide 4: An Expanding Franchise in Contiguous Markets
An Expanding Franchise in Contiguous Markets: 114 banking offices • Ranked #1-3 in deposit market share in 14 counties out of 37* Springfield Columbus Wheeling • Expanding E di along l major highways to Dayton population centers (C l b (Columbus, Dayton, Huntington Cincinnati) • Organized into seven
Slide 5: Growth by Acquisition: A WSBC Core Competency
Growth by Acquisition: A WSBC Core Competency (MM) $6.0 7.5 7 5 year Asset Growth • Focused on higher g g growth $5.0 CAGR = 11.8% metro markets and enhanced market share $4.0 • Five acquisitions in seven $3.0 years – assets more than $2 0 $2.0 doubled since 2001 $1.0 • A history of successful conso
Slide 6: 2009 Accomplishments
2009 Accomplishments • Completed C l t d Amtrust A t t branch b h acquisition i iti ini March, M h adding $600 million in deposits, enhancing overall bank liquidity q y with no loans. • Paid back $75 million in TARP capital in September without necessity of a dilutive common raise. Repurchased warra
Slide 7: Quarterly Performance Comparison
Quarterly Performance Comparison ($000’s except per share data) 1Q 2010 1Q 2009 %∆ Net Income Available to $7,910 $4,394 + 80.0% Common Shareholders Diluted Earnings Per Share $0.30 $0.17 + 76.5% Loan Loss Provision $11,500 $9,550 - 20.4% Pre-tax, Pre-provision & Pre- $21,892 $17,643 + 24.1% TARP –
Slide 8: Strong Capital Base
Strong Capital Base 15.00% 12 00% 12.00% 9.00% 6.00% 3.00% 0.00% 2007 2008 2009 1Q '10 Tangible Equity / Tangible Assets Total Risk Based Capital Data Source = SNL Financial
Slide 9: Ann. Net Charge-offs / Avg. Loans
Ann. Net Charge-offs / Avg. Loans WSBC National Peers* 2.36% 2.06% 1.74% 1.76% 1.58% 1.05% 1 59% 1.59% 0.83% 0.57% 0.68% 1Q'09 2Q'09 3Q'09 4Q'09 1Q'10 • National Peer Group = Average of 103 banks nationwide with assets between $2-$10 B. Source: SNL Financial
Slide 10: NPA + 90 PD Loans / Total Loans + OREO
NPA + ≥ 90 PD Loans / Total Loans + OREO WSBC National Peers* 5.24% 5.40% 4.70% 4.14% 3 49% 3.49% 3.21% 2.67% 2.82% 2.70% 2.24% 1Q'09 2Q'09 3Q'09 4Q'09 1Q'10 • National Peer Group = Average of 103 banks nationwide with assets between $2-$10 B. Source: SNL Financial
Slide 11: Improving Credit Infrastructure: 2010 Initiatives
Improving p g Credit Infrastructure: 2010 Initiatives • Added Add d more staff t ff to t Special S i lAAssets t and d credit dit risk i k managementt • Conducted skills assessment to identify and prioritize opportunities for lender development • Initiated additional formal credit training program fo
Slide 12: 2010 Initiatives
2010 Initiatives • Continue balance sheet restructuring to improve capital & efficiency while anticipating higher interest rates. • Improve p regulatory g y capital p to new “unofficial” well- capitalized ratios. • Promote margin expansion through enhanced marketing of low cost accounts, management
Slide 13: 2010 Initiatives (con't.)
2010 Initiatives (con’t.) • Improve fee income by expanding treasury management focus and increasing sales of non-traditional products such as trust, brokerage and insurance. • Control C l non-interest i expenses through h h improved i d monitoring processes and technology initiatives. • Monitor opp
Slide 14: Wealth Management Services
Wealth Management Services • $2.8B of assets under management/custody. • Over 5,000 trust relationships. • 4 locations in WV & OH Assets Under Management ($B) • Improving performance as Management Fees ($MM) asset values recover. $16.2 $16.5 • Product capabilities: $15.0 $14.9 $13.7 Trust $3.1 I
Slide 15: Significant Liquidity
Significant Liquidity • Loan-to-Deposit ratio decreased to 86% at 3/31/10, down from 103% before 2009 branch acquisition. • Reduced reliance on wholesale funding (borrowings and brokered CDs); < 17% of total assets. • Securities portfolio of $1.2B highly liquid; 52% unpledged and $26 million in net
Slide 16: Securities Portfolio – Quality & Liquidity
Securities Portfolio – Qualityy & Liquidity q y Securities = $1.21 B • Average portfolio yield of 4.42% YTD ~23% 23% of total assets • WAL approx. 4 years • Over 52% unpledged Agencies, 18.0% • Minimal private label CMO’s, equities or corporate/ABS securities Agency Mortgage- Municipals, Municipals
Slide 17: Diversified Loan Portfolio
Diversified Loan Portfolio Total Loans = $3.44 B Comm. Real Estate = Comm. & Ind. $1.78 B 13% Consumer C Const & Dev Dev. 8% 14% Comm. Real Estate, 52% HELOC 7% HELOC, IInvestor- t Owner- Owned Occupied 51% 35% Res Real Estate, Res. Estate 20%
Slide 18: Conservative Exposure to Potential Problem Loan Areas
Conservative Exposure to Potential Problem L Loan A Areas WSBC is Below Regulatory CRE Guidelines Exposure1 % of Regulatory ($Millions) RBC2 Guideline Land, Construction & Development $ 295 68% 100% Investor-Owned Commercial 621 142% N/A Investor-Owned Multi-Family 187 43% N/A Total Land, C&D, and I
Slide 19: CRE and Construction Concentration vs. Peers
CRE and Construction Concentration vs. Peers (1) CRE & Const. Loans / Total Loans (%) CRE & Const. NAs / Total CRE and Const. Loans (%) 55.0 5.0 4.0 50.0 3.0 45.0 45 0 2.0 40.0 1.0 35.0 0.0 08 08 08 08 09 09 09 09 10 08 08 08 08 09 09 09 09 10 20 20 20 20 20 20 20 20 20 20 20 20 20 20 20 20 20 20 1
Slide 20: Net Interest Margin
Net Interest Margin NIM Yield on Earning Assets Cost of Funds 7.00% 6.00% 5.65% 5.28% 5.26% 5.00% 4.00% 3.47% 3.46% 3.57% 3 00% 3.00% 2.52% 2.05% 2.00% 1.91% 1 00% 1.00% 0.00% 1Q'09 4Q '09 1Q '10
Slide 21: Growing & Diversified Noninterest Income
Growing & Diversified Noninterest Income Other (Sec. Gains, BOLI, etc.) Service Charges & Fees Insurance (Net) • Noninterest income contributes over Securities brokerage (Net) 27% of 1Q ‘10 revenue. ($MM) Trust $70 $64.6 • Deposit service charges income up $61.0 $60 $57.3 1.9% from 1Q ’09. $52 9 $52
Slide 22: Interest Rate Sensitivity
Interest Rate Sensitivity % Change in Net Interest Income from Immediate Change in Base Over One Year Interest Rates Mar. 31, 2010 Dec. 31, 2009 U 1% Rate Up R t Sh Shock k +2.0% 2 0% -0.4% 0 4% Up 2 % Rate Shock -0.3% -4.7% Up 3 % Rate Shock -2.9% -9.6% Up 2 % Rate Ramp +2.6% +0.9%
Slide 23: Peer Group – Price / Tangible Book Value
Peer Group – Price / Tangible Book Value Price / Tangible Book Value (X) (X) TCE/ TA (%) 6.20 7.09 9.79 5.85 7.66 6.06 8.62 9.76 8.81 7.12 6.03 5.19 7.55 NPAs / Loans + OREO (%) 1.84 2.92 1.39 3.10 5.95 3.05 2.06 1.98 3.57 3.39 5.51 4.50 4.26 Stock Price ($) 26.85 21.29 32.23 8.20 64.50 18.05 11.61
Slide 24: Peer Group – Price / Normalized Earnings
Peer Group – Price / Normalized Earnings Price / Normalized Earnings (x) (1) Source: Pricing data per FactSet Research Systems (1) Normalized earnings estimates per KBW Research; PRK, FRME, SRCE, UBSI and PEBO normalized earnings estimates not available Data through 5/25/2010
Slide 25: Current Market Update
Current Market Update Market Performance – Cycle-to-Date Market Performance – YTD Source: FactSet Research Systems
Slide 26: Analyst Comments on 1Q Earnings
Analyst y Comments on 1Q Earnings g “WesBanco’s first quarter 2010 earnings showed improvement with regard to credit costs and the net interest margin margin.” -Stephen M. M Moss Janney Montgomery Scott While the increase [in provision expense] is indicative of a continued “While challenging economi
Slide 27: Investment Rationale
Investment Rationale Stability, Diversity and Capital Strength • Strong regulatory capital • Proven acquisition-oriented growth strategy • Improving liquidity • Asset quality compares favorably with peers • Diverse earnings stream • Positioned for rising rates • Improving stock performance
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