Slide 1: Investor Presentation
D A T A A S O F J U N E 3 0 , 2 0 1 6 U N L E S S O T H E R W I S E N O T E D INVESTOR PRESENTATION
Slide 2: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS This presentation may contain forward-looking statements with respect to Fulton Financial Corporation’s financial condition, results of operations and business. Do not unduly rely on forward-looking statements. Forward-looking statements can be identified by the use of wor
Slide 3: Why Fulton?
WHY FULTON? • Risk Management Foundation • Management Depth and Experience • Stability of Geographic Markets / Franchise Value • Strong Capital & Reserves • Commitment to Enhancing Shareholder Value • Relationship Banking Strategy / Customer Experience • Quality Loan Growth / Solid Asset Quality • A
Slide 4: A Valuable Franchise
A VALUABLE FRANCHISE • 243 community banking offices across the Mid-Atlantic • Asset size: $18.5 billion • 3,700+ team members (3,485 FTEs (1)) • Market capitalization: $2.3 billion (2) 4 (1) Full-time equivalent employees. (2) Based on shares outstanding and the closing price as of June 30, 2016.
Slide 5: Strong Position in Attractive Markets
STRONG POSITION IN ATTRACTIVE MARKETS 5 Note: Data as of June 30, 2015 per Federal Deposit Insurance Corporation (FDIC) Summary of Deposits. Household Income Data as of June 30, 2015 per SNL Financial LC. (1) Median HH Income, 2016 – 2021 Projected Population Change and 2016 – 2021 Projected HH Inco
Slide 6: Deep Executive Management Team
Name Position Years at Fulton Years in Financial Services Prior Experience E. Philip Wenger Chairman, President & CEO 36 36 Various roles since joining in 1979 Patrick Barrett (1) Senior EVP & CFO 2 23 SunTrust, JPMorgan, Deloitte Touche Tomatsu Craig Roda Senior EVP/ Community Banking 37 37 Various
Slide 7: Second Quarter Highlights
SECOND QUARTER HIGHLIGHTS Diluted Earnings Per Share: $0.23 in 2Q16, 4.5% increase from 1Q16 and 9.5% increase from 2Q15 Pre-Provision Net Revenue: $53.3 million, 4.9% increase from 1Q16 and 9.7% increase from 2Q15 Linked Quarter Loan and Core Deposit Growth: 0.8% increase in average loans, while av
Slide 8: Income Statement Summary
INCOME STATEMENT SUMMARY Net Income of $39.8 million; a 3.9% increase from 1Q16 and an 8.4% increase from 2Q15. Earnings per share increased 4.5% from 1Q16 and 9.5% from 2Q15. Net Interest Income From 1Q16: Flat, reflecting a 3 bp decrease in net interest margin (NIM), offset by the impact of
Slide 9: Net Interest Income and Margin
NET INTEREST INCOME AND MARGIN Net Interest Income & Net Interest Margin ~ $730 million ~ $610 million $122.9 $125.7 $127.8 $129.1 $128.9 3.20% 3.18% 3.19% 3.23% 3.20% 0.00% 0.50% 1.00% 1.50% 2.00% 2.50% 3.00% 3.50% $- $20.0 $40.0 $60.0 $80.0 $100.0 $120.0 $140.0 Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q2 2
Slide 10: Loan Portfolio Composition & Yield
LOAN PORTFOLIO COMPOSITION & YIELD 10 Note: Loan portfolio composition is based on average balances for the years ended December 31, 2011 to 2015, and six months ended June 30, 2016. (1) Presented on a fully-taxable equivalent basis. $4.6 $4.9 $5.1 $5.2 $5.5 $3.6 $3.7 $3.7 $3.9 $4.1 $1.6 $1.7 $1.7 $
Slide 11: Deposit Portfolio Composition
DEPOSIT PORTFOLIO COMPOSITION 11 Note: Deposit composition is based on average balances for the periods indicated. Average demand and savings up 10.1% compared to the six months ended June 30, 2015; while total average deposits are up 6.4%. 20% 28% 24% 18% 10% Time Deposits Non-Int DDA Int DDA Money
Slide 12: Interest Rate Sensitivity Simulation
1) A variety of interest rate scenarios are used to measure the effects of sudden and gradual movements upward and downward in the yield curve. These results are compared to the results obtained in a flat or unchanged interest rate scenario. Simulation of net interest income is used primarily to mea
Slide 13: Asset Quality
ASSET QUALITY ($ IN MILLIONS) 13 Provision for Credit Losses Non-Performing Loans (NPLs) & NPLs to Loans 113.34% 116.81% 118.37% 121.05% 129.26% 1.28% 1.25% 1.24% 1.20% 1.17% 0.00% 1.00% 2.00% 3.00% 0.00% 25.00% 50.00% 75.00% 100.00% 125.00% 150.00% Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q2 2016 Allowance/
Slide 14: Non-Interest Income
NON-INTEREST INCOME ($ IN MILLIONS) Non-interest Income, Excluding Securities Gains ~ $730 million ~ $610 million $44.1 $43.0 $45.1 $42.2 $46.1 $- $5.0 $10.0 $15.0 $20.0 $25.0 $30.0 $35.0 $40.0 $45.0 $50.0 Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q2 2016 Mortgage Banking Income & Spreads Other Non-interest I
Slide 15: Non-Interest Expenses
NON-INTEREST EXPENSES ($ IN MILLIONS) Non-interest Expense & Efficiency Ratio (1) ~ $730 million ~ $610 million $118.4 $119.3 $118.4 $120.4 $121.6 68.9% 68.8% 66.6% 68.3% 67.6% 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% 80.0% $- $20.0 $40.0 $60.0 $80.0 $100.0 $120.0 $140.0 Q2 2015 Q3 2015 Q4 201
Slide 16: Compliance & Risk Management
$1.8 $2.1 $3.2 $4.3 $2.2 $4.6 $1.4 $8.2 $4.5 $2.1 $0.4 $1.4 $0.2 13 26 30 45 47 51 0 10 20 30 40 50 60 $- $3.0 $6.0 $9.0 $12.0 2011 2012 2013 2014 2015 YTD 6/2016 Salaries & Benefits Expense Outside Consulting Services(1) Temporary Employee Expense Staffing $0.8$0.1 COMPLIANCE & RISK MANAGEMENT (1)
Slide 17: Profitability & Capital
PROFITABILITY & CAPITAL 17 ROA(1) ROE (tangible)(2) Tangible Common Equity Ratio(2) Diluted Earnings Per Common Share 9.83% 9.11% 10.16% 10.07% 10.26% 0.00% 4.00% 8.00% 12.00% Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q2 2016 0.86% 0.78% 0.86% 0.86% 0.88% 0.00% 0.20% 0.40% 0.60% 0.80% 1.00% 1.20% Q2 2015 Q3 2
Slide 18: Stock Repurchase Programs
STOCK REPURCHASE PROGRAMS June 2012 to July 2016 Repurchase Programs (1) Shares Repurchased 31.9 million % of Outstanding Shares 15.9% (2) Amount Repurchased $375 million Average Purchase Price $11.77 18 demand and savings (1) Share repurchases completed from June 2012 through July 31, 2016. (2) Tot
Slide 19: Average Assets and ROA, by Bank
AVERAGE ASSETS AND ROA, BY BANK Six Months Ended Jun 30, 2016 Average Assets ($ Millions) 2016 2015 Fulton Bank, N.A. $9,910 1.07% 1.06% Lafayette Ambassador Bank 1,528 0.96% 1.07% The Columbia Bank 2,139 0.90% 0.82% Fulton Bank of New Jersey 3,719 0.67% 0.76% FNB Bank, N.A. 358 0.60% 0.72% Swinefor
Slide 20: 2016 Outlook
2016 OUTLOOK The following outlook remains unchanged from prior quarter: • Loans & Deposits: Annual average growth rate in the mid- to high-single digits • Asset Quality: Provision driven primarily by loan growth • Non-Interest Income (Excluding Securities Gains): Mid- to high-single digit growth ra
Slide 21: Appendix
APPENDIX
Slide 22: Average Loan Portfolio and Yields
AVERAGE LOAN PORTFOLIO AND YIELDS 22 Note: Yields presented on a fully taxable-equivalent basis, using a 35% federal tax rate and statutory interest expense disallowances. Balance Yield Q1 2016 Q2 2015 Q1 2016 Q2 2015 Comm'l Mort 5,558$ 4.00% 70$ 347$ (0.03%) (0.15%) Commercial 4,081 3.81% (14) 245
Slide 23: Average Customer Funding and Rates
AVERAGE CUSTOMER FUNDING AND RATES 23 Balance Rate Q1 2016 Q2 2015 Q1 2016 Q2 2015 Nonint DDA 4,078$ - % 110$ 343$ - % - % Int DDA 3,454 0.18% 16 301 0.01% 0.05% Savings/MMDA 3,990 0.19% 57 421 0.01% 0.05% CD's 2,844 1.06% (24) (183) 0.02% 0.02% Total Deposits 14,366 0.30% 159 882 0.00% 0.00% Cash M
Slide 24: Ending Loan Distribution by State
ENDING LOAN DISTRIBUTION BY STATE JUNE 30, 2016 24 Comm'l Consumer Comm'l Mortgage Constr. Res. Mtg. & Other Total (in thousands) Pennsylvania 2,955,943$ 2,909,670$ 488,736$ 652,609$ 1,290,859$ 8,297,817$ New Jersey 555,288 1,426,080 183,219 238,100 372,309 2,774,996 Maryland 336,817 576,131 67,531
Slide 25: Non-Performing Loans
NON-PERFORMING LOANS(1) JUNE 30, 2016 25 Comm'l Consumer Ending Loans NPLs/Loans Comm'l Mortgage Constr. Res. Mtg. & Other Total NPLs by State by State Pennsylvania 18,661$ 15,065$ 8,175$ 9,361$ 6,724$ 57,986$ 8,297,817$ 0.70% New Jersey 5,982 15,471 - 7,113 5,264 33,830 2,774,996 1.22% Maryland 5,8
Slide 26: Net Charge-Offs (Recoveries)
NET CHARGE-OFFS (RECOVERIES) THREE MONTHS ENDED JUNE 30, 2016 26 Comm'l Consumer Average Loans Charge-Offs to Comm'l Mortgage Constr. Res. Mtg. & Other Total by State Average Loans Pennsylvania 29$ 619$ 465$ 91$ 1,172$ 2,376$ 8,179,342$ 0.12% New Jersey 1,614 (505) (170) 22 1,526 2,487 2,750,849 0.3
Slide 27: Investment Portfolio
INVESTMENT PORTFOLIO JUNE 30, 2016 27 Weighted Avg. Remaining Life Amortized Unrealized Estimated (in years) Cost Gain (Loss) Fair Value (dollars in millions) Collateralized mortgage obligations 3.2 702$ 4$ 706$ Mortgage-backed securities 4.3 1,242 26 1,268 State and municipal securities 7.9 333 12
Slide 28: A Sustainable Payout
A SUSTAINABLE PAYOUT $0.20 $0.30 $0.32 $0.34 $0.38 $0.19 2.04% 3.12% 2.44% 2.75% 2.92% 2.81% 0.0% 0.5% 1.0% 1.5% 2.0% 2.5% 3.0% 3.5% 4.0% 4.5% $0.00 $0.04 $0.08 $0.12 $0.16 $0.20 $0.24 $0.28 $0.32 $0.36 $0.40 2011 2012 2013 2014 2015 Q2 2016 Cash Dividend Yield 28 (1) Annualized dividend rate per sh
Slide 29: Non-Interest Income (Excluding Securities Gains)
NON-INTEREST INCOME (EXCLUDING SECURITIES GAINS) 29 Q2 2016 Q1 2016 Q2 2015 Q1 2016 Q2 2015 Invt Mgt & Trust 11,247$ 10,988$ 11,011$ 259$ 236$ Overdraft & NSF Fees 5,384 5,272 5,353 112 31 Merchant Fees 4,252 3,682 4,088 570 164 Service Charges 3,932 3,820 3,915 112 17 Mortgage Banking Income 3,897
Slide 30: Non-Interest Expense
NON-INTEREST EXPENSE 30 Q2 2016 Q1 2016 Q2 2015 Q1 2016 Q2 2015 Salaries & Benefits 70,029$ 69,372$ 65,067$ 657$ 4,962$ Occupancy & Equipment 14,683 15,591 15,144 (908) (461) Data Proc. & Software 9,429 9,321 8,270 108 1,159 Outside Services 5,508 6,056 8,125 (548) (2,617) Professional fees 3,353 2,
Slide 31: Non-GAAP Reconciliation
NON-GAAP RECONCILIATION Note: The Corporation has presented the following non-GAAP (Generally Accepted Accounting Principles) financial measures because it believes that these measures provide useful and comparative information to assess trends in the Corporation's results of operations and financia
Slide 32: Non-GAAP Reconciliation (Con't)
NON-GAAP RECONCILIATION (CON’T) 32 Jun 30 Sep 30 Dec 31 Mar 31 Jun 30 2015 2015 2015 2016 2016 Tangible Common Equity to Tangible Assets (TCE Ratio) Shareholders' equity 2,024,817$ 2,025,904$ 2,041,894$ 2,073,309$ 2,106,997$ Less: Intangible assets (531,567) (531,562) (531,556) (531,556) (531,556) T
Slide 33: Fulton Financial Corporation
FULTON FINANCIAL CORPORATION www.fult.com