Flagstar Bank, N.a. · NYSE:FLG
Flagstar Bank, N.a — New York Community Bancorp — Investor Presentation (February 2004)
36 slides from Flagstar Bank, N.a's investor presentation, Feb 18, 2004
Slide 1: Strategies & Strengths: 2003 Investor Presentation
STRATEGIES 2003 Investor Presentation & STRENGTHS February 2004
Slide 2: Forward-looking statements
ThisCompany strategies looking purposes Forward-looking “believe,” recent following realize Factors flows, composition Government, technological The 2 following presentation, merger loan the that statements of within the “expect,” expected demand, said could of including merger, factors with factors
Slide 3: Our Mission
Strength: Our The in 3 themission primary NewOur York of goal Mission New metro is the York region creation Community with of shareholder easyBancorp, access value. toInc. theisfull to range create of shareholder financial products value byand consistently services they delivering seek. the thrift i
Slide 4: We are the nation's 4th largest thrift
Strength: With (dollars At 12/31/03 Mortgage Multi-family Total Core Stockholders’ Market (a) Y-O-Y Atdeposits assets loan 2/13/04 cap inIncrease Our loans 5-Year originations billions) (a) of $ loans 23.4 Balance $equity as $23.4 $6.0 $10.3 8.9 compared 10-Year 10.2 CAGR 107.2 $80.5 billion, 191.5
Slide 5: We are a leading producer of multi-family loans
Strength: We The in sales (a) (b) 5 the SNL NY are leading (c) New ametro DataSource leading Market York producer region metro lender, Leader includes ofregion depository, multi-family Queens, (a)(b) and The loans Staten producer leading forIsland, portfolio supermarket of revenues Brooklyn, in New
Slide 6: Earnings Performance
Strength: We (in Y-O-Y 2003 Earnings Cash Diluted Net Fee (a) (b) (c) May Excludes millions, Please have Interest and Increase Earnings 5-Year EPS Cash Other 2003 been $Performance see 323.4 Income except $net EPS ThriftINVESTOR reconciliation CAGR ranked 10-Year Income 1.65 (b)securities 41.1% $(b)
Slide 7: Strategies: Multi-family Lending
Strategies: We Strategy Rent-controlled buildings 5-year Pre-payment service points economic Reduces Average charge-offs Enhances 59.4% Increases 7 have Is fixed term loan LTV Results interest credit more aearnings generate asset stress profitable, Multi-family since /penalties: at 5-year to ratio r
Slide 8: Multi-family loan originations
Strength: We (in Loan 5-YR 10-YR 54.8% Multi-family All 36.3% $ 1993 Total 8 3,383 2,059 69 359 77 67 603 410 129 millions) Other are $1998 $Originations CAGR: $791 74 CAGR: the 196 542 Multi-family Loan 1999 leading $ Loan 487 Originations 2000 $producer Originations 677 2001 Lending $ 616 2002 of
Slide 9: Multi-family loans outstanding
Strength: (in n Loans Multi-family All 5-YR 10-YR 47.7% $7,369 $3,131 29.5% $ 12/31/93 Total 9 g millions) 995 2,149 4,494 262 3,255 257 360 1,239 429 $Other 3,131 $Loans CAGR: $Outstanding CAGR: 789 1,690 $1,946 12/31/98 Multi-family 1,348 Loans $Outstanding loans Loans 1,496 Outstanding 12/31/99 r
Slide 10: Strategies: Community Banking
Strategies: We Strategy Retain Maintain Provides service Offer and Offsets Address small Enhances Contribute organizations 10 foundations consistently alternative traditional businesses name competition needs Results cross-selling tradition visibility Community toof community through of investment a
Slide 11: Strategies: Products and Services
Strategies: We Hours: Products hours extensive Multiple products by Easy Staffing: to Technology: processing 11 aphone, emphasize fully access: Weekend, and service Over & commissioned range or Community on services: State-of-the-art Walk-up by services, an 400 convenience of mail channels: IP exten
Slide 12: Our Market
Strength: Our Market Division Queens Long Staten Brooklyn Westchester Hudson Essex 85 (a) 12 52 Includes structure Island 139(b) & Island Traditional 24 County, Union Served Community 485one 32 &32 17 9recognizes Other 27 Counties, traditional 5Branches NJ23(b) 60(a) In-store 4NYC -Banking 4 and NJ
Slide 13: Strategies: Earnings Strategy
Strategies: Earnings Strategy Emphasize Offer products Run-off Enhances and Generates Increases 13 margin alternative higher Results opportunities growth earnings net fee Deposit core interest income cost deposits investment hasMix CDs been income Discourages Reduces supported Provides funding by cr
Slide 14: Deposit growth and mix
Strength: We (in Deposit 5-YR 10-YR 73.5% CDs 29.0% $ 12/31/93 Total Core Loans 142.4 1.9 0.7 0.4 0.5 billions) are /Deposits $Deposits: CAGR: /Total CAGR: 1.9 3.0 0.7 0.4 the Total Mix 12/31/98 Deposit $2nd Deposits: 3.3 1.4 0.4 Deposits: largest $ 0.8 Mix 12/31/99 $56.5% thrift 1.1 94.2% $ deposit
Slide 15: Strategies: Risk Management
Strategies: Our Strategy NYC Reduces Contains Originate loans interest Emphasize Increases Offer Run products 15 risk-averse off on third-party margin higher Results aLong credit extension expenses earnings subdivision 1-4 conduit Risk multi-family core family Island cost risk nature Management depo
Slide 16: Net interest margin and risk management
Strength: Our 5-year 3-month NYB 12/31/98 0.00% 1.00% 2.00% 3.00% 4.00% 5.00% 6.00% 7.00% 4.24% 16 balance net U.S. 3.79% LIBOR 12/31/99 interest Risk Treasury sheet 3.33% Management Range: margin structure 12/31/00 3.59% CMT 1.15%—6.40% Range: Range: has 4.31% 12/31/01 shielded 3.33%—4.31% 2.78%—6.
Slide 17: Asset quality: NPAs to total assets
Strength: The NPAs 12/31/99 0.00% 0.20% 0.40% 0.60% 0.80% U.S. NYB Industry 17 quality Thrifts 0.17% to Total Data 12/31/00 Risk of 0.52% 0.19% Source: Assets our Management assets 12/31/01 0.53% 0.19% SNLreflects 0.67% 0.15% Financial 12/31/02 our 0.70% 0.15% underwriting 12/31/03 0.67% standards.
Slide 18: Strategies: Efficiency Strategy
Strategies: Efficiency Strategy Emphasis benefits Above-average traditional 12/31/03) Franchise equipment Cost-effective expansion Hub Profitable branching (a) 18 Excludes & spoke expense Results expansion (a) on third-party Increases branch is Cost expense three amulti-family administrative approac
Slide 19: Efficiency ratio
Strength: We Efficiency 1999 0.00% 10.00% 20.00% 30.00% 40.00% 50.00% 60.00% 70.00% U.S. NYB (a) 19 (a) Core have Thrifts 2000 29.95% (a)efficiency been Cost Ratio 2001 63.13% 30.20% ranked Containment 2002 ratio; 65.72% the 2003 35.03% please nation’s 66.42% 25.32% see3rd reconciliation 62.67% most
Slide 20: Strategies: Third-Party Alliances
Strategies: We Strategy Originate loans Offer insurance Enhances Selectively Provides estate opportunities Increases income 20 generate through third-party joint Results cross-selling other earnings 1-4 products customer Profitable ventures participate significant family third-party operating invest
Slide 21: Fee and service-related income
Strength: (in Fee 5-YR 10-YR 100.8% 46.0% $ 1993 2164.0 42.4 4.6 1.9 millions) and $CAGR: 1998 CAGR: 2.5 service-related Service-related Profitable 1999 $ 82.9 2000 Third-Party 2001 income Income 2002 isAlliances 2003 expected to grow in 2004.
Slide 22: Strategies: Capital Management
Strategies: We Strategy 9 for-3 Insulates 11.3 available Facilitates 75-fold Increases dividend increase capital $ 2Q Approximately through shares stock 600 ‘03 actively million split million of raised splits increase follow-on since Results since against common for EPS on merger Capital manage shar
Slide 23: Follow-on offering
Strength: The Generated Bolstered Positions Supports 23 follow-on various Capital the capital proceeds Company offering strength corporate Management of approximately benefited well and purposes, for flexibility future the Company including $400 acquisitions Funds million in multi-family share sever
Slide 24: Capital ratios after follow-on offering
Strength: The (dollars At Actual Stockholders’ Book Equity Tangible tangible December follow-on value After toin assets stockholder’s book equity Capital assets millions, per Offering 31, equity value offering ratio share to ratio Management 2003 except 3.97% per $12.24% $Increase 2,869 equity was 1
Slide 25: Strategies: Merger Transactions
Strategies: We Strategy Acquired (HAVN) Financial 7/31/01 assets Merged (RSLN) Increased 25 havewith on Results on aHaven Corp. deposit interest-earning low-cost earnings solid Accretive 10/31/03 11/30/00 Richmond Roslyn (RCBK) record Bancorp share funding Bancorp Improved Merger ofCounty on Expande
Slide 26: Three accretive merger transactions in three years
Strength: We 2002 HAVN 11.8%-16.5% RCBK Earnings Original 2004 Completed RSLN 26 have 2002 2004 10/31/03 7/31/01 11/30/00 Actual Revised successfully Accretion Accretive Projection 129.4% 10%Merger 28% completed Results Projection Transactions three accretive merger transactions in three years.
Slide 27: Franchise enhanced by merger transactions
Strength: Our (dollars w 12/31/99 No. Loan Core Total Market Price ROE Diluted (a) (b) (c)/ Diluted Reflects Core HAVN of franchise, deposits 22.99% assets /per branches deposit cap EPS inROE; 12/31/00 share Accretive billions, w core $our $/0.57 19.40%(b) 1.9 $value, ratio 0.42 RCBK please $52-week
Slide 28: Balance sheet repositioning after HAVN and RCBK
Strategies: The Strategy Post-HAVN Downsized consumer Enhanced Sold Post-RCBK Initiated Increased deposits CDs 28 balance to loans andinvestment and origination leveraged Results securitized concentration loans the and Balance borrowings Reduced sheet shifted quality securities onwas products growth
Slide 29: Balance sheet repositioning after Roslyn
Strategies: We Strategy Post-RSLN Invested securities Reduces volume Sold equity 1Q Increases Increased reducing Replaced CDs reverse favorable 29 ‘04 have approximately and repos of Results $2.3 extension initiated concentration earnings FHLB rates portfolio core multi-family second Balance Reduces
Slide 30: Diluted EPS growth
Strength: We $2.17 Diluted 5-YR 39.6% 11-YR 30.3% $ 1993 (a) (b) 1.63(a) 1.25 0.76(a) 0.42 0.12 Diluted Company are 1999 CAGR: -$CAGR: currently EPS 0.47(a) Performance 2000 core Growth estimates EPS; 2001 projecting $please 2002 2.20(b) a2003 see 35%reconciliation 2004 increase in 2004 to diluted d
Slide 31: Factors driving 2004 earnings growth
Strength: Several Higher The Continuation 31 continued net other factors Performance interest operating ofsuspension are ourexpected income, industry-leading income, ofreflecting to our drive reflecting loanearnings efficiency aloss record the provision full-year growth volume ratio inof benefit 200
Slide 32: Market capitalization and share price growth
Strength: From (dollars Market Price M rk t6 55.9% a10-YR C $ 11/23/9312/31/9412/31/9512/31/9612/31/9712/31/9812/31/9912/31/0012/31/0112/31/0212/31/03 90.3% $7,325 9.7% p6.75 ea per 3,052 2,329 1,087 604 105 249 12.86 0.9311/23/93 $$57.1% 5-YR CAGR: $8,897 Capitalization 632 175 $362 in 1.47 7.44 sh
Slide 33: Total returns since merger announcements
Strength: Each Increase Date Bank HAVN RCBK RSLN (a) (b) Compares of of Announcement June March June Merger our inTotal 27, merger 27, NYB’s 27, Returns Total 2003 2000 2001 transactions 61 thru Return 52-week $0.21 741% 263 352/13/04(a) per 217 1,065 Quarterly high share has%of provided Dividend(b)
Slide 34: Total returns since 1993
Strength: Since Total per 53.7% R 1,057% 1,600% 770% 140% 293% 671% 60% $ 11/23/9312/31/9412/31/9512/31/9612/31/9712/31/9812/31/9912/31/0012/31/0112/31/0212/31/03 90.3% 4,422% 3,794% 2,051% 28.54 3.51 0.93 e share t $ureturn 11/23/93, $718% $57.1% 41.8% 12.86 r 16.25 $n1.47 7.44 dividend Total 32.93
Slide 35: Reconciliation Appendix
Reconciliation Appendix 1. earnings For December (in 2003 Net Add Associated Dividends Amortization Total Cash Basic Diluted 2. $39.6 3. 4. million included aafter-tax merger-related As The On thousands, the income back: earnings additional calculated cash amillion Company Twelve on recorded reporte
Slide 36: For More Information
For More The Log E-mail Call Write 615 2/18/04 Merrick Company onto Investor to: requests New our Information: Avenue Relations web York trades to:site: ir@myNYCB.com Community Westbury, onwww.myNYCB.com at: the(516) NYSE NYBancorp, 683-4420 under 11590the Inc.symbol “NYB”.
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