Associated Banc-corp · NYSE:ASB
Associated Banc-corp — Investor Presentation (February 2019)
29 slides from Associated Banc-corp's investor presentation, Feb 13, 2019
Slide 1: Associated Banc-Corp Investor Presentation 2019
Exhibit 99.1 Associated Banc-Corp Investor Presentation 2019 Brookfield Office (Milwaukee MSA) – Opened October 2017 FIRST QUARTER
Slide 2: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS 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
Slide 3: Our Franchise
OUR FRANCHISE Fourth Quarter 2018 Highlights and Accomplishments of assets1 of loans1 $34 billion $23 billion . Largest bank headquartered in Wisconsin3 Nearly $4 billion of equity2 $25 billion of deposits1 . Approximately 4,700 employees, servicing over 1 million customer accounts in 8 states and 2
Slide 4: Attractive Midwest Markets
ATTRACTIVE MIDWEST MARKETS Large Population Base With a Manufacturing and Wholesale Trade-Centric Economy Midwest holds ~20% of the U.S. population1 and Manufacturing Focus Well-Suited for Our Midwest Location nearly 30% of all U.S. manufacturing jobs2 ASB C&BL Loans by Industry Total ASB Loans by G
Slide 5: Loan Growth Trends
LOAN GROWTH TRENDS 2014 Average Annual Loans – 2018 G rowth Across the Portfolio CAGR ($ in billions) $22.7 Commercial & Business . Core manufacturing-centric portfolio is $20.6 complemented with specialty national businesses $19.7 $18.3 $7.7 4% Commercial Real Estate $16.8 . Well diversified by geo
Slide 6: Deposit Growth and Mix Trends
DEPOSIT GROWTH AND MIX TRENDS 2014 - 2018 Average Annual Deposits CAGR Period End Low-cost Deposit Mix ($ in billions) Loan to Deposit Ratio 50% 51% 47% 49% 46% 94% 92% 91% 92% 23% 89% 25% 24% 24% 26% $24.1 19% 20% 16% 14% 17% $21.9 $21.0 7% 6% 7% 7% 8% $19.9 $5.2 6% 2014 2015 2016 2017 2018 $5.0 $1
Slide 7: Yields, Net Interest Income and Margin — Annual Trends
YIELDS, NET INTEREST INCOME AND MARGIN— ANNUAL TRENDS Average Yields Net Interest Income & Net Interest Margin ($ in millions) 5.04% 3.08% 2.97% 2.84% 2.80% 2.82% 3.89% 4.51% 3.68% 3.47% 3.46% $880 3.66% $14 $15 3.38% 3.40% $8 3.18% 3.23% 3.23% 2.59% $741 2.45% 2.58% 2.34% 2.42% $707 $681 $677 1.16%
Slide 8: Noninterest Income - Annual Trends
NONINTEREST INCOME - ANNUAL TRENDS ($Noninterest IN MILLIONS Income) Wealth Management ($ in millions) ($ in millions) $28 $20 $353 $356 $16 $15 $16 $329 $333 $48 $49 $47 $50 $54 $291 $20 2014 2015 2016 2017 2018 $38 $20 Trust & asset management Brokerage & advisory $32 $31 Strong Insurance Commissi
Slide 9: Noninterest Expense Trends
NONINTEREST EXPENSE TRENDS ($Annual IN MILLIONS Noninterest) Expense Trend Quarterly Noninterest Expense Trend ($ in millions) ($ in millions) $822 $29 $698 $703 $709 $680 $310 $213 $211 $204 $278 $280 $279 $282 $193 $181 $80 $78 $74 $77 $75 $483 $401 $416 $425 $429 $118 $124 $124 $117 $107 2014 201
Slide 10: Overall Expense Efficiency
OVERALL EXPENSE EFFICIENCY Efficiency Enhanced Automation Branch Consolidations Operational Efficiencies Drivers Efficiency Ratio1 Total Period End Deposits Per Branch ($ in millions) $105 70.3% 70.0% $73 68.5% 68.2% 67.0% 66.0% 66.2% $46 65.5% 64.9% 64.5% 62.5% 2014 2015 2016 2017 2018 2Q 2008 4Q 2
Slide 11: Investing in Customer Technology
INVESTING IN CUSTOMER TECHNOLOGY Retail Customer Focused Enhancements . New mobile app received 4.7-star rating with >5,000 reviews1 . Zelle P2P implementation expected in early 2019 – Will provide intuitive, real-time payments capability via ASB’s mobile app and online banking platforms with strong
Slide 12: Strong Capital Position and Deployment
STRONG CAPITAL POSITION AND DEPLOYMENT CET1 and TCE Ratios1 Full Year Dividends 10.1% 10.3% $0.62 9.7% 9.5% 9.5% 14% CAGR2 $0.50 $0.45 $0.41 $0.37 7.0% 6.9% 6.9% 7.1% 7.0% 2014 2015 2016 2017 2018 2014 2015 2016 2017 2018 TCE ratio CET1 ratio Non-Organic Growth Common Stock Repurchases ($ in million
Slide 13: Acquisitions
ACQUISITIONS Bank Mutual completed… …and Huntington up next Was an in-market, cost takeout Is an in-market, cost takeout driven acquisition acquisition Delivering on Filled in network gaps and boosted Fills in network gaps and boosts our our Strategy our network in key locations network in key locat
Slide 14: 2018: Momentum Continues
2018: MOMENTUM CONTINUES ($ in millions) $356 Total noninterest $353 $333 Positive revenue growth trends… income $296 Accelerating $261 $269 Fee-based ▪ Net interest income up 19% year over year 1 Revenue revenue ▪ Fee-based revenue1 up 10% year over year $880 $707 $741 Net interest Growth income 20
Slide 15: 2019 Outlook
2019 OUTLOOK This outlook reflects a stable to improving economy and includes our expectation of two interest rate increases in 2019. We may adjust our outlook if, and when, we have more clarity on any one, or more, of these factors. ▪ 3% - 6% annual average loan ▪ Approximately $800 million growth
Slide 16: Line of Business Profiles
LINE OF BUSINESS PROFILES
Slide 17: Balanced Business Segments
BALANCED BUSINESS SEGMENTS1 Corporate and Community, Consumer, Commercial Specialty and Business . Corporate Banking . Consumer and Business Banking . Commercial Real Estate . Community Markets . Private Client and Institutional Services Average Loans and Net Interest Income and Return on Average De
Slide 18: Corporate Banking
CORPORATE BANKING CORPORATE AND COMMERCIAL SPECIALTY SEGMENT Business Units 2018 Overview . Commercial $13.3 billion in average loans Specialized Corporate Deposits Capital and deposits Lending Lending and Treasury Markets Verticals . 10 offices across 6 states Management . ~260 colleagues Creative,
Slide 19: Commercial Real Estate
COMMERCIAL REAL ESTATE CORPORATE AND COMMERCIAL SPECIALTY SEGMENT Business Units 2018 Overview . $6.6 billion in average loans Real Estate CRE CRE and deposits CRE Lending Investment Syndications Tax Credits Trusts . 12 offices across 8 states . ~100 colleagues Local experienced teams create custom
Slide 20: Consumer and Business Banking
CONSUMER AND BUSINESS BANKING COMMUNITY, CONSUMER, AND BUSINESS SEGMENT Business Units Serving Metro Markets 2018 Overview . $17.1 billion in average loans Retail Residential Business and deposits Banking Lending Banking . 168 branches . ~2,000 colleagues Full range services for individuals and smal
Slide 21: Community Markets
COMMUNITY MARKETS COMMUNITY, CONSUMER, AND BUSINESS SEGMENT Business Units Serving Midsize Markets 2018 Overview . $3.8 billion in average loans Commercial & Branch Residential Private and deposits Business Banking Lending Banking Banking . 68 branches . ~440 colleagues Localized approach ensures th
Slide 22: Private Client and Institutional Services
PRIVATE CLIENT AND INSTITUTIONAL SERVICES COMMUNITY, CONSUMER, AND BUSINESS SEGMENT Business Units 2018 Overview Private Banking Personal Trust Asset Management . $2.5 billion in average loans and deposits Retirement Plan Associated Benefits Associated . $10.3 billion AUM Services and Risk Consultin
Slide 23: Appendix
APPENDIX
Slide 24: Huntington Branch Transaction Summary
HUNTINGTON BRANCH TRANSACTION SUMMARY Seller: The Huntington National Bank Existing ASB Branches Acquired Branches Assets Purchased: . 32 branches and ~$134 million of WI related loans Deposits Assumed: ~$850 million Consideration: 100% Cash Transaction Value: . ~4% net blended premium on deposits a
Slide 25: Credit Quality – Annual Trends
CREDIT QUALITY – ANNUAL TRENDS ($ IN MILLIONS; AT OR FOR THE YEAR ENDED) Nonperforming Assets Nonaccrual Loans $293 $275 $229 $209 $194 $193 $177 $178 $140 $128 2014 2015 2016 2017 2018 2014 2015 2016 2017 2018 Net Charge Offs Allowance for Loan Losses to Loans $65 1.5% 1.5% 1.4% 1.3% $39 1.0% $30 $
Slide 26: Loans Stratification
LOANS STRATIFICATION OUTSTANDINGS AS OF DECEMBER 31, 2018 C&BL by Geography Total Loans1 CRE by Geography $8.3 billion $5.1 billion Minnesota 6% Illinois Illinois Minnesota 3 15% 14% Texas Illinois 24% 12% 11% Other Minnesota Other 2 Midwest 10% Wisconsin 2 Wisconsin Wisconsin Midwest 10% 29% 27% 32
Slide 27: High Quality Securities
HIGH QUALITY SECURITIES ($ IN BILLIONS) Portfolio Detail as of December 31, 2018 Strategic Portfolio Average Balance and Yield Trends Amortized Fair Duration Investment Type Cost Value (Yrs) $7$8 $6.91 5.00% $7 GNMA CMBS $7 $5.91 $6.05 $6.03 $1.78 $1.71 2.77 $6$7 $5.59 $6 4.00% GNMA MBS & CMOs 2.52
Slide 28: Reconciliation and Definitions of Non-GAAP Items
RECONCILIATION AND DEFINITIONS OF NON-GAAP ITEMS Efficiency Ratio 2014 2015 2016 2017 2018 Federal Reserve efficiency ratio 70.28% 69.96% 66.95% 65.97% 66.23% Fully tax-equivalent adjustment (1.36)% (1.41)% (1.29)% (1.28)% (0.71)% Other intangible amortization (0.39)% (0.31)% (0.20)% (0.18)% (0.66)%
Slide 29: Reconciliation and Definitions of Non-GAAP Items
RECONCILIATION AND DEFINITIONS OF NON-GAAP ITEMS Tangible common equity reconciliation1 ($ in millions) 2014 2015 2016 2017 2018 Common equity $2,740 $2,816 $2,931 $3,078 $3,524 Goodwill and other intangible assets, net (937) (985) (987) (992) (1,245) Tangible common equity $1,803 $1,831 $1,944 $2,0
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