First Financial Bancorp. · NASDAQ:FFBC
First Financial Bancorp — Investor Presentation (August 2024)
44 slides from First Financial Bancorp's investor presentation, Aug 27, 2024
Slide 1: Investor Presentation Second Quarter 2024
investor presentation • Second Quarter 2024 Exhibit 99.1
Slide 2: Forward looking statements disclosure
forward looking statements disclosure 2 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,” “ex
Slide 3: Forward looking statements disclosure
forward looking statements disclosure 3 • financial services reform and other current, pending or future legislation or regulation that could have a negative effect on our revenue and businesses, including the Dodd-Frank Act and other legislation and regulation relating to bank products and services
Slide 4: Presentation contents
About First Financial Bancorp Financial Performance Appendix presentation contents 4
Slide 5: Overview
overview Commercial C&I, O-CRE, Treasury, ABL, ESOP, Equipment Finance, Bannockburn Global Forex Retail Banking Consumer, Small Business Mortgage Banking NASDAQ: FFBC Headquarters: Cincinnati, Ohio Founded: 1863 Banking Centers: 131 Employees: 2,144 Market Cap (6/30/24): $2.1B Dividend Yield (6/30/2
Slide 6: Key investment highlights
key investment highlights • Proven & sustainable business model spanning 160 years • Premier Midwest franchise with top quartile performance • Consistent profitability – 135 consecutive quarters • High quality balance sheet & robust capital position (11.78% CET1) • Prudent risk management & credit c
Slide 7: Consistent best-in-class earnings
1-Year 3-Year 2Q18-2Q24 (since merger) 81% Percentile Rank KRX Top Quartile1 1.34% 85% Percentile Rank 1.22% 1.39% 1.25% 87% Percentile Rank 1.31% 1.28% consistent best-in-class earnings 7 Return on Average Assets 1 KRX calculated as the top quartile of the current 50 KRX constituents. Source: S&P C
Slide 8: Consistent better than market earnings growth
consistent better than market earnings growth 8 Earnings Per Share Growth 1 KRX calculated as the median of the current 50 KRX constituents. Source: S&P Capital IQ Pro 1-Year 3-Year 5-Year 10-Year 20-Year 67% Percentile Rank 11% 6% 84% Percentile Rank 90% Percentile Rank 3% 1% 67% Percentile Rank 5%
Slide 9: Complementary market centric strategies
Note: Headquarters loan and deposit balances include special assets, loan marks, and other out of market and corporately held balances. Loan balances exclude PPP balances. complementary market centric strategies Loans $3.4B / Deposits $2.9B Loans $1.8B / Deposits $5.4B Loans $4.0B / Deposits $5.2B L
Slide 10: Key company brands
key company brands Full suite of diversified financial products for individuals and businesses $18.2 Billion Assets $13.7 Billion Deposits 20.88% Adjusted MRQ ROATCE Diversified financial holding company with comprehensive and innovative solutions for individuals and businesses Wealth & asset manage
Slide 11: Diversified lines of business
The number of Trust & Investments and RPS relationships are updated as of 9/30/22. All other data as of 12/31/22. diversified lines of business 11
Slide 12: Revenue growth strategies
revenue growth strategies Distribution Technology Talent Product & Pricing • Regional pricing strategy • Treasury Management product investments • Investments in Product Management DefinedModels Enterprise Data Management • Investment in data warehouse • Enabling data as a strategic asset • Connecti
Slide 13: Presentation contents
About First Financial Bancorp Financial Performance Appendix presentation contents 13
Slide 14: 2Q 2024 results
2Q 2024 results 135th Consecutive Quarter of Profitability 14 • EOP assets increased $566.9 million compared to the linked quarter to $18.2 billion • EOP loans increased $316.1 million compared to the linked quarter to $11.5 billion • Average deposits increased $351.1 million compared to the linked
Slide 15: 2Q 2024 highlights
2Q 2024 highlights • Exceptional quarterly earnings driven by strong loan growth, net interest margin, and record fee income • Adjusted1 earnings per share – $0.65 • Adjusted1 return on assets – 1.40% • Adjusted1 pre-tax, pre-provision return on assets – 2.10% • Adjusted1 return on average tangible
Slide 16: 2Q 2024 highlights
2Q 2024 highlights • Adjusted1 noninterest expense of $122.5 million, a 1.2% increase from first quarter • Adjustments1 include $0.4 million efficiency-related costs and $0.8 million in other costs such as acquisition, severance and branch consolidation costs • Increase driven by variable compensati
Slide 17: Adjusted net income
adjusted net income1 17 The table below lists certain adjustments that the Company believes are significant to understanding its quarterly performance. 1 Non-GAAP financial measure which management believes facilitates a better understanding of the Company’s financial condition. See Appendix for Non
Slide 18: Profitability
profitability 18 Return on Average Assets Return on Avg Tangible Common Equity Diluted EPS 1 Non-GAAP financial measure which management believes facilitates a better understanding of the Company’s financial condition. See Appendix for Non-GAAP reconciliation. $0.64 $0.53 $0.60$0.66$0.69 $0.65 $0.59
Slide 19: Net interest income & margin
net interest income & margin 19 Net Interest Margin (FTE) 2Q24 NIM (FTE) Progression Net Interest Income All dollars shown in millions 4.00%3.99% 4.12%4.21% 4.34% 0.10%0.11% 0.14% 0.12% 0.14% 4.10%4.10% 4.26% 4.33% 4.48% 2Q241Q244Q233Q232Q23 Basic Margin (FTE) Loan Fees $148.4 $143.9 $147.7$150.9$15
Slide 20: Liquidity and beta profile
liquidity and beta profile 20 1Historical data adjusted for the merger with MainSource Financial Group, Inc. using the sum of the individual components. Historical Deposit and Loan Betas1 Total Deposit Beta Loan Beta Liquidity Trends 79% 81% 82% 82% 82% 82% 83% 84% 3Q22 4Q22 1Q23 2Q23 3Q23 4Q23 1Q24
Slide 21: Noninterest income
noninterest income 21 Noninterest Income 2Q24 Highlights All dollars shown in thousands • Record total fee income; 28.6% of net revenue • Foreign exchange income of $16.8 million; increased $6.4 million, or 60.9%, from the linked quarter • Leasing business income of $16.8 million; increased $2.2 mil
Slide 22: Noninterest expense
noninterest expense 22 Noninterest Expense 2Q24 Highlights All dollars shown in thousands • Core expenses increased $1.4 million, or 1.2% • $2.9 million increase in variable incentive compensation tied to fee income • Includes full quarter impact from Agile and annual salary adjustments • $1.2 milli
Slide 23: Average balance sheet
1.40% 1.77% 2.08% 2.30% 2.44% 2.42% 2.45% 2.47% 0.40% 0.37% 0.31% 0.22% 0.14% 0.09% 0.03% 0.02% 2Q23 3Q23 4Q23 1Q24 2Q24 Apr May Jun Cost of Deposits Change in Cost of Deposits average balance sheet 23 Average LoansAverage Securities Average Deposits All dollars shown in millions 1 Includes loans fe
Slide 24: Deposits
deposits 24 Deposit Product Mix (Avg) 2Q24 Average Deposit Progression All dollars shown in millions Total growth/(decline): $351.1 million Noninterest- bearing $3,025 22% Interest-bearing demand $1,637 12% Savings $1,046 8% Money Markets $2,953 22% Retail CDs $1,553 11% Brokered Deposits $1,438 11%
Slide 25: Average deposit trends
average deposit trends 25 All dollars shown in millions Business Public Funds Personal Uninsured Deposits $6,312$6,162$5,921$5,824$5,821$5,903 2Q241Q244Q233Q232Q231Q23 $3,824$3,823$3,913$3,789$3,664$3,881 2Q241Q244Q233Q232Q231Q23 $1,978$1,864$1,928$1,805$1,823$1,842 2Q241Q244Q233Q232Q231Q23 Uninsure
Slide 26: Deposit concentrations
NAICS Sector 6/30/24 % of Total Deposits Manufacturing $571.9 4.1% Real Estate and Rental and Leasing 439.1 3.2% Finance and Insurance 488.6 3.5% Construction 359.3 2.6% Professional, Scientific, and Technical Services 296.9 2.2% Other Services (except Public Administration) 274.5 2.0% Health Care a
Slide 27: Borrowing capacity & cash/investment liquidity
27 Borrowing Capacity • Interest-bearing deposits with other banks of $739 million • Investment securities portfolio: • 97.5% of investment portfolio classified as available-for-sale • $595.4 million of expected cash flow from securities portfolio in next 12 months • $520.2 million of floating rate
Slide 28: Agile acquisition
agile acquisition 28 • Acquired February 29th • $93.4 million in loans acquired; $207.8 million as of June 30th • $5.6 million of intangibles created • Agile is a full-service specialty finance company based in Lincolnshire, IL and operates throughout the U.S. • Lends to commercial customers to fina
Slide 29: Loan portfolio
loan portfolio 29 Loan LOB Mix (EOP) Net Loan Change-LOB (Linked Quarter) All dollars shown in millions Total growth/(decline): $316.1 million $5.9 $108.1 $4.2 -$10.2 $59.1 $88.8 $22.2 $38.0 ICRE Commercial & Small Business Banking Oak Street Franchise Summit Agile Consumer Mortgage ICRE $3,718 32%
Slide 30: Loan concentrations
loan concentrations 30 C&I and Owner Occupied CRE Loans by Sector1 Investor CRE Loans by Property Type All dollars shown in millions 1 Excludes Agile Premium Finance NAICS Sector 6/30/24 % of Total Loans Finance and Insurance $1,313.7 11.4% Manufacturing 508.4 4.4% Accommodation and Food Services 30
Slide 31: Area of focus - office portfolio
area of focus - office portfolio (non-owner occupied) 31 Office Property Type 1 Performance metrics based on loans greater than $2.5 million and excluding classified assets. All dollars shown in millions Office Property Market Office Maturity Schedule • $458.4 million balance represents 4.0% of tota
Slide 32: Allowance for credit losses
allowance for credit losses 32 ACL / Total Loans 2Q24 Highlights All dollars shown in millions • $172.6 million combined ACL; $16.4 million combined provision expense • $156.2 million ACL – loans and leases; increase driven by loan growth and credit migration; 1.36% of loan balances • Utilized Moody
Slide 33: Asset quality
asset quality 33 Nonperforming Assets / Total AssetsClassified Assets / Total Assets Net Charge Offs & Provision Expense1 . 1 Provision includes both loans & leases and unfunded commitments All dollars shown in millions $195.3 $162.3 $141.0$140.6$138.9 1.07% 0.92% 0.80%0.82%0.81% 2Q241Q244Q233Q232Q2
Slide 34: Capital
capital 34 Tier 1 Common Equity Ratio Total Capital Ratio Tangible Common Equity Ratio 6/30 Risk Weighted Assets = $13,803,249 All capital numbers are considered preliminary. 1 Non-GAAP financial measure which management believes facilitates a better understanding of the Company’s financial conditio
Slide 35: Capital ratios reflecting net unrealized losses
capital ratios, reflecting net unrealized losses1 35 Tier 1 Common Equity Ratio Total Capital Ratio 6/30 Risk Weighted Assets = $13,803,249 All capital numbers are considered preliminary. 1 Assumes Company holds cash proceeds of securities sales Tier 1 Capital Ratio 9.98%10.11%10.24% 9.62%9.53% 7.00
Slide 36: Capital strategy
capital strategy 36 Strategy & DeploymentTangible Book Value Per Share • 4.1% annualized dividend yield as of June 30th • 36.2% of 2Q24 earnings returned to shareholders through common dividend • Most recent internal stress testing indicates capital ratios above regulatory minimums in all modeled sc
Slide 37: Outlook commentary
outlook commentary1 • Loan balances expected to grow low single digits on an annualized basis • Average deposit balances expected to grow modestly • Investment portfolio expected to remain stable 37 • Total noninterest expense expected to be $122 - 124 million • Stable expense base expected excludin
Slide 38: Presentation contents
About First Financial Bancorp Financial Performance Appendix presentation contents 38
Slide 39: Appendix: our markets
appendix: our markets • Greater Cincinnati/Dayton • Loans $4.4 billion • Deposits $6.0 billion • Deposit Market Share #4 (2.9%) • Banking Centers 50 • Fortune 500 Companies 7 • Indianapolis • Loans $1.0 billion • Deposits $0.8 billion • Deposit Market Share #14 (1.2%) • Banking Centers 10 • Fortune
Slide 40: Non-GAAP financial information
The Company’s Investor Presentation contains certain financial information determined by methods other than in accordance with accounting principles generally accepted in the United States (GAAP). Such non-GAAP financial information should be considered supplemental to, and not as a substitute for,
Slide 41: Appendix: non-GAAP to GAAP reconciliation
appendix: non-GAAP to GAAP reconciliation 41 All dollars shown in thousands Net interest income and net interest margin - fully tax equivalent June 30, Mar. 31, Dec. 31, Sep. 30, June 30, 2024 2024 2023 2023 2023 Net interest income 153,311$ 148,740$ 153,765$ 155,455$ 159,232$ Tax equivalent adjustm
Slide 42: Appendix: non-GAAP to GAAP reconciliation
appendix: non-GAAP to GAAP reconciliation 42 All dollars shown in thousands Additional non-GAAP ratios June 30, Mar. 31, Dec. 31, Sep. 30, June 30, (Dollars in thousands, except per share data) 2024 2024 2023 2023 2023 Net income (a) 60,805$ 50,689$ 56,732$ 63,061$ 65,667$ Average total shareholders
Slide 43: Appendix: non-GAAP to GAAP reconciliation
appendix: non-GAAP to GAAP reconciliation 43 All dollars shown in thousands Additional non-GAAP measures 4Q23 3Q23 As Reported Adjusted As Reported Adjusted As Reported Adjusted As Reported Adjusted Net interest income (f) 153,311$ 153,311$ 148,740$ 148,740$ 153,765$ 153,765$ 155,455$ 155,455$ Provi
Slide 44: First Financial Bancorp
44 First Financial Bancorp First Financial Center 255 East Fifth Street Cincinnati, OH 45202
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