Financial Institutions, Inc. · NASDAQ:FISI
Financial Institutions — Shareholder Meeting (May 2014)
38 slides from Financial Institutions's shareholder meeting presentation, May 7, 2014
Slide 1: Annual Meeting of Shareholders
May 7, 2014 Annual Meeting of Shareholders Exhibit 99.1
Slide 2: John E. Benjamin, Chairman
John E. Benjamin John E. Benjamin Chairman
Slide 3: Agenda
Introductions Introductions Call Meeting to Order Call Meeting to Order Director Nominations & Election Director Nominations & Election Ratify the Appointment of KPMG LLP as independent Ratify the Appointment of KPMG LLP as independent registered public accounting firm registered public accounting f
Slide 4: Call Meeting to Order
Call Meeting to Order Call Meeting to Order Formal Meeting
Slide 5: Director Nominations & Election
Call Meeting to Order Call Meeting to Order Director Nominations & Election Director Nominations & Election Formal Meeting
Slide 6: Ratify Appointment of KPMG LLP
Call Meeting to Order Call Meeting to Order Director Nominations & Election Director Nominations & Election Ratify the appointment of KPMG, LLP as independent Ratify the appointment of KPMG, LLP as independent registered public accounting firm registered public accounting firm Formal Meeting
Slide 7: Non-Binding Vote on Executive Compensation
Call Meeting to Order Call Meeting to Order Director Nominations & Election Director Nominations & Election Ratify the appointment of KPMG, LLP as independent Ratify the appointment of KPMG, LLP as independent registered public accounting firm registered public accounting firm Non-Binding Vote on Ex
Slide 8: Formal Meeting
Call Meeting to Order Call Meeting to Order Director Nominations & Election Director Nominations & Election Ratify the appointment of KPMG, LLP as independent Ratify the appointment of KPMG, LLP as independent registered public accounting firm registered public accounting firm Non-Binding Vote on Ex
Slide 9: Martin K. Birmingham, Management Presentation
Martin K. Birmingham Martin K. Birmingham President and Chief Executive Officer Management Presentation
Slide 10: Forward-looking statements
Statements contained in this presentation which are not historical facts Statements contained in this presentation which are not historical facts and which pertain to future operating results of Financial Institutions, and which pertain to future operating results of Financial Institutions, Inc. Inc
Slide 11: The Fundamental Drivers of our Business Success
The Fundamental Drivers of our Business Success • Core Deposit Growth • Quality Loan Growth • Sound Risk Management • Expense Management • Community Involvement • High Performance Culture • The Customer Experience
Slide 12: Core Deposit Growth
Core Deposit Growth $1,570 $1,699 $1,718 $2,039 $2,094 $2,268 $1,000 $1,200 $1,400 $1,600 $1,800 $2,000 $2,200 $2,400 $2,600 2009Y 2010Y 2011Y 2012Y 2013Y 2014Q1 Total Deposits Core Deposits
Slide 13: Quality Loan Growth
Quality Loan Growth $1,264 $1,346 $1,485 $1,834 $1,849 $1,000 $1,100 $1,200 $1,300 $1,400 $1,500 $1,600 $1,700 $1,800 $1,900 $2,000 2009Y 2010Y 2011Y 2012Y 2013Y 2014Q1 $1,706
Slide 14: Sound Risk Management: Preparing for the Future
ae Financial Institutions, Inc? Preparing for the Future CFPB pbodd Frank SOX 404 Basel III
Slide 15: Expense Management: Efficiency Ratio
E f f i c i e n c y R a t i o E x p e n s e a s a P e r c e n t o f R e v e n u e Expense Management Note: Peer data as of 12/31/13 reflects median values for the SNL US Banks $1-$5B Index Peer 67.58% 65.52% 60.36% 60.55% 62.87% 58.48% 56.96% 50.00% 52.00% 54.00% 56.00% 58.00% 60.00% 62.00% 64.00% 6
Slide 16: Community Involvement
ae Financial Institutions, Inc? 1750+ Hours of Service $380,000 Donated Annually 267Community Based Organizations Supported Strategy > Leadership > Success
Slide 17: High Performance Culture
High Performance Culture Engaged Index 10% Willingness to Recommend FSB 15% Teamwork & Personal Growth 10% Motivated to Go Above & Beyond 3% Source: Annual FSB Employee Assessments November 2012 compared to October 2013
Slide 18: The Customer Experience
The Customer Experience Customer Loyalty Overall Satisfaction Likelihood to Recommend Likelihood to Continue to Purchase Likelihood to Choose FSB Again 4% 4% 3% 4% 6% Source: Annual FSB Retail Customer Assessment; June 2013 compared to April 2014
Slide 19: Shareholder Value: Market Capitalization
4/30/13 4/30/14 Market capitalization $263.9 mil. $320.7 mil. Shares outstanding 13.8 mil. 13.9 mil. Price $19.13 $23.15 52-week range $15.71 - $17.92 - $20.83 $26.59 Annualized Dividend Rate $ 0.72 $ 0.76 Dividend yield 3.76% 3.28% Shareholder Value
Slide 20: Strategy
Strateg N 6H we Financial Institutions, Inc? Jul'13
Slide 21: Kevin B. Klotzbach, Financial Overview
Kevin B. Klotzbach Kevin B. Klotzbach EVP and Chief Financial Officer/Treasurer Financial Overview
Slide 22: Balance Sheet Growth
Balance Sheet Growth $1,264 $1,346 $1,485 $1,706 $1,834 $1,717 $1,849 $1,743 $1,883 $1,932 $2,262 $2,320 $2,409 $2,533 $2,062 $2,214 $2,336 $2,764 $2,929 $2,828 $3,016 $1,000 $1,500 $2,000 $2,500 $3,000 $3,500 2009Y 2010Y 2011Y 2012Y 2013Y 2013Q1 2014Q1
Slide 23: Loan Portfolio Composition
Loan Portfolio Composition 6.5% $0 $200 $400 $600 $800 $1,000 $1,200 $1,400 $1,600 $1,800 $2,000 2009Y 2010Y 2011Y 2012Y 2013Y 2013Q1 2014Q1 Comm Loan Comm Mortg Res Mortg Home Equity Indirect Consumer 9.1% 12.9% 15.9%
Slide 24: NPAs / Assets
Note: Peer data reflects median values for the component companies within each group obtained from SNL Financial. NPAs / Assets 0.56% 1.49% 1.27% 0.00% 0.50% 1.00% 1.50% 2.00% 2.50% 3.00% 3.50% 2009Y 2010Y 2011Y 2012Y 2013Y 2014Q1 FISI SNL US Banks $1-$5B Mid-Atl. Banks $1-$5B
Slide 25: Low risk security portfolio
15.6% 23.7% 31.6% Low risk security portfolio High percentage of the portfolio consists of securities backed by the U.S. government and agencies $860 million in total securities and the majority are utilized for various pledging purposes Data as of December 31,2013 Low Risk Securities Portfolio 29.1
Slide 26: Deposit Composition
Deposit Composition $0 $500 $1,000 $1,500 $2,000 $2,500 $3,000 2009Y 2010Y 2011Y 2012Y 2013Y 2013Q1 2014Q1 CDs >$100 CDs <$100 Savings & MM Int-bearing Demand Nonint-bearing Demand 18.1% 6.7% 13.4%
Slide 27: Capital Adequacy
Capital Adequacy 12.08% 10.82% 7.63% 6.72% 4.00% 6.00% 8.00% 10.00% 12.00% 14.00% 16.00% 2009 2010 2011 2012 2013 Total Risk-Based Capital Tier 1 Risk-Based Capital Leverage Ratio Tang. Comm. Equity / Tang. Assets
Slide 28: Revenue Growth
Note: All periods exclude OTTI & Securities Gains Revenue Growth $72.3 $78.8 $81.9 $88.5 $91.6 $22.9 $23.3 $20.0 $19.9 $20.9 $22.2 $23.6 $5.7 $6.0 $0.0 $20.0 $40.0 $60.0 $80.0 $100.0 $120.0 $140.0 2009Y 2010Y 2011Y 2012Y 2013Y 2013Q1 Net Interest Income Noninterest Income $29.3 $28.6 2014Q1
Slide 29: Net Interest Income
Net Interest Income Continues to Grow… …despite margin compression headwinds Growing Net Interest Income 3.00% 3.20% 3.40% 3.60% 3.80% 4.00% 4.20% 4.40% 4.60% 4.80% 5.00% $0.0 $10.0 $20.0 $30.0 $40.0 $50.0 $60.0 $70.0 $80.0 $90.0 $100.0 2009Y 2010Y 2011Y 2012Y 2013Y Net Interest Income Net Interest
Slide 30: Noninterest Income
39% 21% 9% 23% 42% 22% 10% 19% 12/31/13 YTD $23.6 Million 12/31/12 YTD $21.2 Million All periods exclude OTTI & Securities Gains Noninterest Income 8% 7% Service Charges on Deposits ATM & Debit Card Revenue Investment Advisory Revenue Company Owned Life Insurance Other
Slide 31: Noninterest Expense
Revenue grew by 25% since 2009 while expenses increased by only 11% Noninterest Expense 65.52% 58.48% 54.00% 56.00% 58.00% 60.00% 62.00% 64.00% 66.00% 68.00% $0 $10 $20 $30 $40 $50 $60 $70 $80 $90 2009Y 2010Y 2011Y 2012Y 2013Y Noninterest expense Efficiency Ratio
Slide 32: Provision for Loan Loss
Provision for Loan Loss 0.47% 0.40% 0.00% 0.10% 0.20% 0.30% 0.40% 0.50% 0.60% $0 $2 $4 $6 $8 $10 2009Y 2010Y 2011Y 2012Y 2013Y Provision Net Charge -Offs
Slide 33: Earnings
Earnings $14.4 $21.3 $22.8 $23.4 $25.5 $0.99 $1.61 $1.49 $1.60 $1.75 $0.50 $1.00 $1.50 $2.00 $10.0 $15.0 $20.0 $25.0 $30.0 2009 2010 2011 2012 2013 Net Income Diluted EPS
Slide 34: Dividend Yield
Source: SNL Financial Note: FISI market data as of 4/30/2014. Peer data reflects median values for the component companies within each group as of 3/31/14. Dividend Yield 3.28% 2.10% 1.63% 0.0% 0.5% 1.0% 1.5% 2.0% 2.5% 3.0% 3.5% FISI Mid-Atl. Banks $1-$5B SNL US Banks $1-$5B
Slide 35: Total Shareholder Return
Source: SNL Financial Note: Market data as of 4/30/2014. Peer data reflects median values for the component companies within each group Total Shareholder Return 82% 68% 71% 25% 22% 23% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% FISI Mid-Atl. Banks $1-$5B SNL US Banks $1-$5B 5 Year Return 1 Year Return
Slide 36: Voting Results
Voting Results John E. Benjamin John E. Benjamin Chairman
Slide 37: Closing Remarks
Closing Remarks John E. Benjamin John E. Benjamin Chairman
Slide 38: Annual Meeting of Shareholders
May 7, 2014 Annual Meeting of Shareholders
Financial Institutions — Shareholder Meeting (May 2014) on 6ix