Fulton Financial Corporation · NASDAQ:FULT
Fulton Financial — Investor Presentation (November 2010)
56 slides from Fulton Financial's investor presentation, Nov 5, 2010
Slide 1: Fulton Financial Corporation Investor Presentation
Fulton Financial Corporation - ------------------------------------- Investor Presentation Data as of September 30, 2010
Slide 2: Forward-Looking Statement
Forward-Looking Statement n This presentation may contain forward-looking statements about Fulton Financial Corporation’s financial condition, results of operations, business, strategies, products and services. You can identify forward-looking statements by the use of words such as “may”, “should”,
Slide 3: Presentation Outline
Presentation Outline u Corporate Profile u Franchise and Markets u Overview of the 3 rd Quarter u Capital u Earnings/Peer Group u Financial Performance u Supplemental Credit Information u Investment Portfolio
Slide 4: Fulton Financial Profile (as of 9/30/10)
Fulton Financial Profile (as of 9/30/10) n Mid-Atlantic regional financial holding company n A family of 8 community banks in 5 states n Fulton Financial Advisors n Fulton Mortgage Company n 272 community banking offices n Asset size: $ 16.3 billion n 3,800 Team Members n Market capitalization: $ 1.
Slide 5: A Valuable Geographic Franchise
A Valuable Geographic Franchise
Slide 6: Superior Customer Experience
Superior Customer Experience WE WILL CARE, LISTEN, UNDERSTAND, AND DELIVER
Slide 7: Our Brand
Our Brand COMMUNITY BANKING SMALL BUSINESS HIGH NET WORTH RETAIL BANKING
Slide 8: Overview of the 3rd Quarter
Overview of the 3rd Quarter n TARP redeemed in full on July 14th n Repurchased associated warrant on September 8th n Strong mortgage activity and related sale gains n Net interest margin expansion n Continued core deposit growth / highly liquid n Regulation E overdraft guidelines implemented n Annou
Slide 9: Overview of the 3rd Quarter / Credit
Overview of the 3rd Quarter / Credit n Loan balances stable / growth offset runoff and charge-offs n Earning asset growth a challenge n Economic recovery slower than anticipated n Non-performing assets and overall delinquency increased linked quarter n Further reduction in construction exposure n Pr
Slide 10: Summary of Larger Loans 9/30/10
Summary of Larger Loans 9/30/10 n 52 relationships with commitments to lend of $20 million or more n Maximum individual commitment: $33 million n Maximum commitment land development: $25 million Ø Maximum commitment any one development project: $15 million n Average commercial lending relationship s
Slide 11: Basel Capital Guidelines
Basel Capital Guidelines n Corporation’s current capital levels exceed preliminary guidelines n Possible further definition and clarification from U. S. Regulatory Authorities
Slide 12: Capital 9/30/10
Capital 9/30/10 GAAP Capital $1.88 billion Total Risk-Based Capital $1.77 billion Total Risk-Based Capital Ratio 13.90% Tier 1 Risk-Based Capital Ratio 11.40% Leverage Capital Ratio 9.20% Tangible Common Equity Ratio 8.40% Tangible Common Equity to Risk-Weighted Assets 10.45%
Slide 13: Dodd Frank Act
Dodd Frank Act n Established organizational structure to address each applicable Title n Expect market opportunities with appropriate planning and strategizing n Believe we are in a better position to absorb increased costs than smaller competitors
Slide 14: Mortgage Foreclosures
Mortgage Foreclosures n Media focus is largely on high volume servicing/ foreclosure operations n Each customer viewed on case-by-case basis n Strive to keep borrowers in their homes n Approximately 300 residential foreclosure actions initiated during first nine months of this year n Currently condu
Slide 15: Fulton Financial Corporation
FULTON FINANCIAL CORPORATION
Slide 16: Quarterly Net Income (in millions)
Quarterly Net Income (in millions) 13.1 13.1 23.3 24.4 27.5 31.7 37.7 0.0 10.0 20.0 30.0 40.0 Q1 09 Q2 09 Q3 09 Q4 09 Q1 10 Q2 10 Q3 10
Slide 17: Income Statement Summary
Income Statement Summary Net Interest Income 140,190 $ 139,160 $ 1,030 $ 1% Loan Loss Provision (40,000) (40,000) - 0% Other Income 50,270 43,060 7,210 17% Securities Gains 1,830 103% Other Expenses (101,820) (100,160) (1,660) 2% Net Income 37,680 31,680 6,000 19% Net Income Available to
Slide 18: Income Statement Summary (YTD September)
Income Statement Summary (YTD September) Net Interest Income 417,850 $ 384,860 $ 32,990 $ 9% Loan Loss Provision (120,000) (145,000) 25,000 -17% Other Income 133,020 130,520 2,500 2% Securities Gains 2,950 (2,440) -83% Other Expenses (301,200) (313,990) 12,790 -4% Net Income 96,840 49,540 47,300 95%
Slide 19: Peer Group
Peer Group* International Bancshares Corporation Old National Bancorp South Financial Group, Inc. Susquehanna Bancshares, Inc. TCF Financial Corporation Trustmark Corporation UMB Financial Corporation United Bankshares, Inc. Valley National Bancorp Whitney Holding Corporation Wilmington Trust Corpor
Slide 20: Net Interest Margin
Net Interest Margin 3.81 3.73 3.37 3.00 3.25 3.50 3.75 4.00 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 FULT Peer Top 50
Slide 21: Average Loans (Q3 2010 vs. Q2 2010)
Average Loans (Q3 2010 vs. Q2 2010) Q3 2010 Q2 2010 $ % (dollars in millions) Comm'l Mort 4,340 $ 4,320 $ $ 0% Commercial 3,670 3,690 (20) -1% Home Equity 1,640 1,640 - 0% Resid Mort 1,000 3% Construction (40) -4% Cons./Other 2% Total Loans 11,960 $ 11,960 $ - $ 0%
Slide 22: Average Loans (September Year to Date)
Average Loans (September 30 th - Year to Date) $ % (dollars in millions) Comm'l Mort 4,320 $ 4,100 $ $ 5% Commercial 3,680 3,660 1% Home Equity 1,640 1,670 (30) -2% Resid Mort 3% Construction 1,140 (230) -20% Cons./Other (20) -4% Total Loans 11,960 $ 11,970 $ (10) $ 0%
Slide 23: Average Loan Growth
Average Loan Growth (0.1) (5.0) (5.4) -9.0 -6.0 -3.0 0.0 3.0 6.0 9.0 12.0 15.0 YTD FULT Peer Top 50
Slide 24: Net Charge-Offs To Average Loans
Net Charge-Offs To Average Loans 1.10 1.03 1.92 0.00 0.50 1.00 1.50 2.00 YTD FULT Peer Top 50
Slide 25: Non-performing Loans to Loans
Non-performing Loans to Loans 2.87 2.56 2.97 0.00 1.00 2.00 3.00 4.00 Q2 10 Q3 10 FULT Peer Top 50 NOTE: Peer and Top 50 data not available for Q3 10
Slide 26: Allowance to Loans
Allowance to Loans 2.38 2.06 2.80 0.80 1.10 1.40 1.70 2.00 2.30 2.60 2.90 Q2 10 Q3 10 FULT Peer Top 50 NOTE: Peer and Top 50 data not available for Q3 10
Slide 27: Allowance to Non-performing Loans
Allowance to Non-performing Loans 83.2 87.1 83.9 50.0 100.0 150.0 200.0 250.0 300.0 Q2 10 Q3 10 FULT Peer Top 50 NOTE: Peer and Top 50 data not available for Q3 10
Slide 28: Average Deposits (Q3 2010 vs. Q2 2010)
Average Deposits (Q3 2010 vs. Q2 2010) Q3 2010 Q2 2010 $ % (dollars in millions) Nonint DDA 2,140 $ 2,080 $ $ 3% Int DDA 2,130 2,020 5% Savings/MMDA 3,210 3,090 4% CD's 4,990 5,120 (130) -3% Cash Management (10) -2% Total Deposits 12,930 $ 12,780 $ $ 1%
Slide 29: Average Deposits (September Year to Date)
Average Deposits (September 30 th - Year to Date) $ % (dollars in millions) Nonint DDA 2,070 $ 1,800 $ $ 15% Int DDA 2,040 1,820 12% Savings/MMDA 3,050 2,310 32% CD's 5,100 5,540 (440) -8% Cash Management (80) -15% Total Deposits 12,730 $ 12,020 $ $ 6%
Slide 30: Average Deposit Growth
Average Deposit Growth 7.0 5.0 4.3 (3.0) 0.0 3.0 6.0 9.0 12.0 15.0 18.0 YTD FULT Peer Top 50
Slide 31: Other Income
Other Income 0.0 40.0 80.0 120.0 160.0 200.0 Millions YTD Sept YTD Dec
Slide 32: Other Income (Q3 2010 vs. Q2 2010)
Other Income (Q3 2010 vs. Q2 2010) (dollars in thousands) Mort. Sales Gains 12,110 $ 3,060 $ 9,050 $ 296% Overdraft & NSF Fees 8,830 9,620 (790) -8% Invt Mgt & Trust 8,600 8,660 (60) -1% Service Charges 3,410 3,350 2% Debit Card Fees 3,360 3,370 (10) 0% Cash Mgt Fees 2,520 2,510 0% Merchant Fees 2,2
Slide 33: Other Income (September Year to Date)
Other Income (September 30 th - Year to Date) (dollars in thousands) Overdraft & NSF Fees 27,330 $ 26,570 $ $ 3% Invt Mgt & Trust 25,350 23,970 1,380 6% Mort. Sales Gains 18,540 18,760 (220) -1% Service Charges 9,860 9,760 1% Debit Card Fees 9,690 8,060 1,630 20% Cash Mgt Fees 7,310 8,940 (1,630) -1
Slide 34: More Efficient Than Peers
More Efficient Than Peers 52.8 60.8 63.5 50.0 52.0 54.0 56.0 58.0 60.0 62.0 64.0 YTD FULT Peer Top 50
Slide 35: Other Expense (Q3 2010 vs. Q2 2010)
Other Expense (Q3 2010 vs. Q2 2010) (dollars in thousands) Salaries & Benefits 54,530 $ 54,650 $ (120) $ 0% Occupancy & Equip. 13,480 13,180 2% FDIC Insurance 4,710 5,140 (430) -8% Data Proc. & Software 4,320 4,070 6% Legal & Audit 3,040 3,030 0% Supplies & Postage 2,660 2,820 (160) -6% OREO & Repo
Slide 36: Other Expense (September Year to Date)
Other Expense (September 30 th - Year to Date) (dollars in thousands) Salaries & Benefits 161,530 $ 165,190 $ (3,660) $ -2% Occupancy & Equip. 41,400 41,090 1% FDIC Insurance 14,800 21,740 (6,940) -32% Data Proc. & Software 12,630 13,970 (1,340) -10% Legal & Audit 8,620 6,700 1,920 29% Supplies & Po
Slide 37: Corporate Priorities
Corporate Priorities n EPS growth to improve total shareholder return n Reduce credit costs and construction exposure n Aggressively seek quality loans / protect current relationships n Pricing to reward, retain and enhance retail customer relationships n Leverage our brand and Forbes recognition n
Slide 38: Fulton Financial Corporation
Fulton Financial Corporation One Penn Square Lancaster, PA 17602 www.fult.com
Slide 39: Supplemental Credit Information
Supplemental Credit Information
Slide 40: Commercial Loans by Industry (Sept. 30, 2010)
Commercial Loans by Industry (Sept. 30, 2010) Manufacturing 13.7 RE - Rental and Leasing 13.4 Construction 11.8 Agriculture 8.3 Retail 8.1 Wholesale 7.6 Health Care 6.5 Other 5.4 Financial Services 3.1 Arts and Entertainment 2.3 Transportation
Slide 41: Loan Distribution by State (Q3 2010)
Loan Distribution by State (Q3 2010) Average % of 10 v. 09 % Balance Total Growth Growth Pennsylvania 6,720,000 $ 56.2% 275,000 $ 4% New Jersey 2,450,000 20.5% (31,000) -1% Maryland 1,395,000 11.7% (134,000) -9% Virginia 1,055,000 8.8% (63,000) -6% Delaware 340,000 2.8% (3,000) -1% 11,960,000 $
Slide 42: Provision and Net Charge-Offs
Provision and Net Charge-Offs Provision Net Charge-Offs / Average Loans $50 $45 $45 $40 $40 $40 $0 $20 $40 $60 Q2 09 Q3 09 Q4 09 Q1 10 Q2 10 Q3 10 ($ in millions) 0.97% 0.81% 0.97% 0.95% 0.97% 1.19% 0.00% 0.50% 1.00% 1.50% Q2 09 Q3 09 Q4 09 Q1 10 Q2 10 Q3 10
Slide 43: Net Charge-offs (Recoveries) (Q3 2010)
Net Charge-offs (Recoveries) (Q3 2010) Comm'l (in thousands) Pennsylvania 3,913 $ - $ $ $ 1,429 $ 5,667 $ Maryland (1,742) (160) 11,873 10,672 New Jersey 2,300 1,285 - 1,092 5,266 Virginia (89) (3) 10,133 10,468 Delaware Avg Loans 3,671,000 4,342,000 868,000 998,000 2,081,000 11,960,000 NCO % 0.49%
Slide 44: Loan Delinquency (Key Sectors)
Loan Delinquency (Key Sectors) Category Total (%) 9/30/10 90-Days 9/30/10 Total (%) 9/30/09 90-Days 9/30/09 Commercial Loans 3.08 2.31 2.26 1.65 Consumer Direct 1.54 0.71 1.69 0.65 Commercial Mortgage 2.85 2.29 1.84 1.31 Residential Mortgage 9.19 5.26 9.28 5.14 Construction 12.02 10.98 11.37 10.12 T
Slide 45: Non-performing Loans (September 30, 2010)
Non-performing Loans* (September 30, 2010) Comm'l (in thousands) Pennsylvania 43,683 $ 38,901 $ 9,615 $ 13,809 $ 4,620 $ 110,628 $ Maryland 9,685 4,540 36,196 4,444 2,156 57,021 New Jersey 17,944 44,009 15,319 11,481 4,352 93,105 Virginia 12,540 4,395 29,788 17,936 65,620 Delaware End Loans 3,684,00
Slide 46: Residential Mtg by State (September 30, 2010)
Residential Mtg by State (September 30, 2010) Ending % of NPL Allowance Pennsylvania 473,000 $ 47.2% 13,810 $ 6,400 $ New Jersey 162,000 16.2% 11,480 2,600 Maryland 121,000 12.1% 4,440 1,710 Virginia 180,000 18.0% 17,940 8,070 Delaware 6.6%
Slide 47: C&I Loans by State (September 30, 2010)
C&I Loans by State (September 30, 2010) Ending % of NPL Allowance Pennsylvania 2,473,000 $ 67.1% 43,680 $ 67,100 $ New Jersey 566,000 15.4% 17,940 22,780 Maryland 351,000 9.5% 9,690 5,810 Virginia 261,000 7.1% 12,540 9,610 Delaware 0.9%
Slide 48: Construction Loans (September 30, 2010)
Construction Loans (September 30, 2010) Ending % of NPL Allowance Pennsylvania 316,000 $ 37.9% 9,610 $ 17,270 $ Virginia 189,000 22.7% 29,790 19,350 Maryland 175,000 21.0% 36,200 26,800 New Jersey 139,000 16.7% 15,320 8,220 Delaware 1.8%
Slide 49: Declining Construction Exposure
Declining Construction Exposure $834 $1,029 $1,367 $1,269 $978 $0 $250 $500 $750 $1,000 $1,250 $1,500 $1,750 12/31/2007 12/31/2008 12/31/2009 09/30/2009 09/30/2010 (7%) (23%) (19%) ($ in millions) Construction Loans / Total Loans 12.2% 10.5% 8.2% 8.6% 7.0%
Slide 50: Construction Loans by Type 9/30/10
Construction Loans by Type 9/30/10 Ending % of Balance Total Commercial Residential 534,000 $ 64.0% Commercial 244,000 29.3% Real Estate 45,000 5.4% Other Commercial 11,000 1.3% 834,000 $
Slide 51: CRE Loans by State (September 30, 2010)
CRE Loans by State (September 30, 2010) Ending % of NPL Allowance Balance Total Balance Allocations Pennsylvania 2,265,000 $ 52.1% 38,900 $ 19,560 $ New Jersey 1,216,000 28.0% 44,010 12,110 Maryland 388,000 8.9% 4,540 3,040 Virginia 350,000 8.1% 4,400 6,120 Delaware 127,000 2.9% 8,440 3,260 4,346,00
Slide 52: Shared National Credits (September 30, 2010)
Shared National Credits (September 30, 2010) Ending Commercial / Industrial 117,930 $ Commercial Real Estate Total Outstanding Delinquency: 2.8%
Slide 53: Troubled Debt Restructurings
Troubled Debt Restructurings Residential Mtg 35,380 $ 32,010 $ C&I/Comm'l Mtg 20,650 19,210 Construction 5,750 6,160 Consumer/other Note: Excludes non-accrual TDR's
Slide 54: Investment Portfolio Detail
Investment Portfolio Detail
Slide 55: Investment Portfolio (September 30, 2010)
Investment Portfolio (September 30, 2010) ENDING MODIFIED BALANCE DURATION (in millions) Agency collateralized mortgage obligations 928.0 $ 1.81 Agency mortgage-backed securities 838.7 2.44 Municipal bonds 350.2 4.92 Auction rate securities 271.6 3.38 Corporate & trust preferred securities 139.3 10.
Slide 56: Fulton Financial Corporation
Fulton Financial Corporation One Penn Square Lancaster, PA 17602 www.fult.com Version 2010-11-05
Fulton Financial — Investor Presentation (November 2010) on 6ix