Cvb Financial Corporation · NASDAQ:CVBF
Cvb Financial — Q3 2014 Earnings Presentation
41 slides from Cvb Financial's earnings presentation, Dec 3, 2014
Slide 1: 3Q Results 2014
Exhibit A December 2014 3Q Results 2014 | cbbank.com
Slide 2: Safe Harbor
Safe Harbor Certain matters set forth herein (including the exhibits hereto) constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including forward-looking statements relating to the Company’s current business plans and expectations regard
Slide 3: CVB Financial Corp. (CVBF)
CVB Financial Corp. (CVBF) ? Total Assets: $7.4 Billion ? Gross Loans: $3.7 Billion ? Total Deposits (Including Repos): $6.3 Billion ? Total Equity: $849 Million ? Largest financial institution headquartered in the Inland Empire region of Southern California. Founded in 1974 ? Locations in 42 cities
Slide 4: Experienced Leadership
Experienced Leadership Name Position Banking Experience CVBF Service Christopher D. Myers President & CEO 30 Years 8 Years Executive Vice President Richard C. Thomas 5 Years 4 Years Chief Financial Officer Executive Vice President James F. Dowd 37 Years 6 Years Chief Credit Officer Executive Vice Pr
Slide 5: Board of Directors
Board of Directors Name CVB Experience Age Linn Wiley—Chairman 22 Years 76 George Borba Jr.—Vice Chairman 2 Years 47 Ray O’Brien—Vice Chairman 2 Years 57 Steve Del Guercio 2 Years 53 Robert Jacoby 8 Years 73 Hal Oswalt 1 Year 66 San Vaccaro 14 Years 81 Chris Myers—CEO 8 Years 52 3Q Results 2014 | cb
Slide 6: Who is CVB Financial Corp.?
CVB Financial Corp. Who is CVB Financial Corp.? 3Q Results 2014 | cbbank.com
Slide 7: Largest Banks Headquartered in California
Largest Banks Headquartered in California Rank Name Asset Size (9/30/14) In millions 1 Wells Fargo $1,636,855 2 Union Bank $110,320 3 Bank of the West $68,874 4 First Republic Bank $46,681 5 SVB Financial $36,041 6 City National Bank $32,016 7 East West Bank $28,481 8 OneWest Bank $21,956 9 Pacific
Slide 8: Bank Accomplishments & Ratings
Bank Accomplishments & Ratings ? 150 Consecutive Quarters of Profitability ? 100 Consecutive Quarters of Cash Dividends ? #4 Rated Bank: BankDirector Magazine ? Bank Performance Scorecard (August 2014) ? BauerFinancial Report ? Five Star Rating (March 2014) ? Fitch Rating ? BBB (September 2014) 3Q R
Slide 9: Our Markets
Our Markets 3Q Results 2014 | cbbank.com
Slide 10: Existing Locations
Existing Locations 40 Business Financial Centers 6 Commercial Banking Centers 3 CitizensTrust Locations Corporate Office Business Financial Centers Commercial Banking Centers CitizensTrust San Diego – NEW Opened 06/02/2014
Slide 11: Deposits
Deposits* # of Center Total Deposits Total Deposits (000’s) Locations (9/30/13) (9/30/14) Los Angeles County 18 $1,913,762 $2,095,048 Inland Empire 9 $1,763,235 $2,069,631 (Riverside & San Bernardino Counties) Central Valley 9 $863,738 $881,252 Orange County 9 $662,013 $934,747 Other 1 $258,621 $307
Slide 12: Total Deposits
Total Deposits* $7,500,000 $6,500,000 $5,500,000 $4,500,000 $3,500,000 $2,500,000 $1,500,000 $500,000 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 (000’s) 2010 2011 2012 2013 2014 Non-Int Bearing Dep Interest Bearing Deposits* *Interest Bearing Deposits includes REPOs 3Q Results 2014 | c
Slide 13: Deposit Cost Comparison
Deposit Cost Comparison Source: Q3 2014 earnings release & other company filings, SNL Financial—peers represent public CA , AZ, HI, NV, OR & WA banks with assets $2—$25 billion. Peer data as of 06/30/2014 1.40% CVBF Peers 1.20% 1.00% 0.80% 0.60% 0.40% 0.20% 0.00% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Slide 14: Total Loans
Total Loans* $4,400,000 $4,200,000 $4,000,000 $3,800,000 $3,600,000 $3,400,000 $3,200,000 $3,000,000 $2,800,000 $2,600,000 $2,400,000 $2,200,000 $2,000,000 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2010 2011 2012 2013 2014 (000’s) Total Non-Covered Loans Total Covered Loans *Before de
Slide 15: Loan Portfolio Composition
Loan Portfolio Composition Total Loans by Type Municipal Lease Finance Other, 1.9% Receivables, 2.2% Dairy, Livestock & SFR Mortgage, Agribusiness, 5.2% 5.3% Multi-Family, 5.9% Commercial & Industrial, 14.3% Construction RE, 1.8% Commercial RE- Non-Owner, 40.8% Commercial RE—Owner Occupied, 22.6% So
Slide 16: Credit Quality
CVB Financial Corp. Credit Quality 3Q Results 2014 | cbbank.com
Slide 17: Non-Performing Assets
Non-Performing Assets* $200,000 $180,000 $160,000 $140,000 $120,000 $100,000 $80,000 $60,000 $40,000 $20,000 $- Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 (000’s) 2009 2010 2011 2012 2013 2014 Non-Performing Loans OREO *Non-Covered 3Q Results 2014 | cbbank.com 17
Slide 18: Classified Loans
Classified Loans* $800,000 $700,000 $600,000 $500,000 $400,000 $300,000 $200,000 $100,000 $- Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 (000’s) 2009 2010 2011 2012 2013 2014 *Non-Covered 3Q Results 2014 | cbbank.com 18
Slide 19: Loans: Net Charge-Offs
Loans: Net Charge-Offs* $0 2009 2010 2011 2012 2013 9/30/2014 $10,000 $20,000 $30,000 $40,000 $50,000 $60,000 $70,000 (000’s) Net Charge-Offs (by year) *Non-Covered 3Q Results 2014 | cbbank.com 19
Slide 20: Profits
CVB Financial Corp. Profits 3Q Results 2014 | cbbank.com
Slide 21: Net Income
Net Income $32,500 $30,000 $27,500 $25,000 $22,500 $20,000 $17,500 $15,000 $12,500 $10,000 $7,500 $5,000 $2,500 $- Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 (000’s) 2009 2010 2011 2012 2013 2014 Net Income After Taxes $20.4 million FHLB prepayment charge 3Q Results 2014 |
Slide 22: Earnings
Earnings 9 Months to (000’s) 2010 2011 2012 2013 9/30/2014 Net Interest Income $259,317 $234,681 $236,950 $216,266 $175,339 Provision for Loan Losses ($61,200) ($7,068) $0 $16,750 $16,100 Other Operating ($111,378) ($106,809) ($122,257) ($88,741) ($68,405) Income/Expenses (Net) Income Taxes ($23,804
Slide 23: Net Interest Margin
Net Interest Margin 4.25% 4.00% 3.75% 3.50% 3.25% 3.00% 2.75% 2.50% 2.25% 2.00% 1.75% 1.50% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2007 2008 2009 2010 2011 2012 2013 2014 Normalized* *Normalized tax-equivalent excludes accretion on covered loans
Slide 24: Efficiency & Expenses
Efficiency & Expenses 3Q Results 2014 | cbbank.com
Slide 25: Efficiency Ratio
Efficiency Ratio 90.00% 80.00% 70.00% 60.00% 50.00% 40.00% 30.00% 20.00% 10.00% 0.00% Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2011 2012 2013 2014 Efficiency Ratio $20.4 million FHLB prepayment charge 3Q Results 2014 | cbbank.com 25
Slide 26: Non-Interest Expense as a % of Average Assets
Non-Interest Expense as a % of Average Assets 3.50% 3.00% 2.50% 2.00% 1.75% 1.50% 1.00% 0.50% 0.00% Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2011 2012 2013 2014 Non-Interest Expense as a % of Average Assets $20.4 million FHLB prepayment charge 3Q Results 2014 | cbbank.com 26
Slide 27: Capital
Capital 3Q Results 2014 | cbbank.com
Slide 28: Capital Ratios
Capital Ratios Regulatory Regulatory September 30, 2014* Minimum Ratio Well-Capitalized Ratio Tier 1 Risk-based Capital Ratio 4.0% 6.0% 17.27% Total Risk-based Capital Ratio 8.0% 10.0% 18.52% Tier 1 Leverage Ratio 4.0% 5.0% 10.71% Tangible Capital Ratio 10.50% Core Tier 1 Capital Ratio 16.71% * CVB
Slide 29: Securities & Investments
Securities & Investments 3Q Results 2014 | cbbank.com
Slide 30: Securities Portfolio
Securities Portfolio* —$3.2 Billion— Trust Preferred Yield on securities CMO’s / 0.16% Municipal portfolio = 2.58% REMIC’s Bonds 18.61% for the 3rd Quarter 2014 10.19% Government Agency & GSEs 10.42% MBS 60.62% ? Securities portfolio totaled $3.16 billion at 9/30/2014. The portfolio represents 42.59
Slide 31: Securities Portfolio
Securities Portfolio* $3.2 Billion Mark-to-Market (Pre-tax) $100,000 $80,000 $60,000 $40,000 $31,187 $20,000 $0 -$20,000 -$40,000 Jun Sep Dec Mar Jun Sep Dec Mar Jun Sep Dec Mar Jun Sep Dec Mar Jun Sept Dec Mar Jun Sept 09 09 09 10 10 10 10 11 11 11 11 12 12 12 12 13 13 13 13 14 14 14 (000’s) *Secur
Slide 32: CVBF Assets
CVBF Assets 12/31/06 $6.1 Billion 9/30/14 $7.4 Billion Loans, Securities net 42.4% 49.9% Loans, Securities net 49.1% 42.6% Goodwill & Fed Intangibles Balance*, 0.7% Other 4.6% 2.4% Fed Goodwill & Balance* Intangibles 2.1% 1.0% Other 5.2% *Includes overnight funds held at the Federal Reserve, Interes
Slide 33: Yield on Securities vs. Yield on Loans
Yield on Securities vs. Yield on Loans 6.00% 5.00% 4.00% 3.00% 2.00% 1.00% 0.00% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2009 2010 2011 2012 2013 2014 Yield on Loans* Yield on Securities 3Q Results 2014 | cbbank.com *Excluding Discount Accretion
Slide 34: CVBF Liabilities
CVBF Liabilities 12/31/06 $5.7 Billion Junior subordinated Debentures 1.9% 9/30/14 $6.6 Billion Other Borrowings Borrowings Liabilities 3.0% Junior subordinated 36.0% Total 0.9% Debentures Deposits* 0.4% 61.4% Other Liabilities 0.7% Total Deposits* 95.7% *Includes Customer Repurchase Agreements 3Q R
Slide 35: Our Growth Strategy
Our Growth Strategy 3Q Results 2014 | cbbank.com
Slide 36: Our Vision
Our Vision Citizens Business Bank will strive to become the dominant financial services company operating throughout the state of California, servicing the comprehensive financial needs of successful small to medium sized businesses and their owners. 3Q Results 2014 | cbbank.com 36
Slide 37: Target Customer
Target Customer The best privately-held and/or family-owned businesses throughout California — Annual revenues of $1-200 million — Top 25% in their respective industry — Full relationship banking — Build 20-year relationships 3Q Results 2014 | cbbank.com 37
Slide 38: Three Areas of Growth
Three Areas of Growth Same Store DeNovo Sales Acquisitions —Banks— —Trust— 3Q Results 2014 | cbbank.com 38
Slide 39: Acquisition Strategy
Acquisition Strategy —Banks— Target size: $200 million to $2 billion in assets Financial & Strategic In-market and/or adjacent geographic market (California only) —Trust/Investment— Target size: AUM of $200 million to $1 billion In California —Banking Teams— In- market & ‘new’ markets 3Q Results 201
Slide 40: Our 'Critical Few'
Our ‘Critical Few’ Execute on DeNovo Growth Initiatives Pursue Strategic Acquisitions Quality Loan Growth Provide Customer Solutions Through Technology Expand Market Share Through Same Store Sales 3Q Results 2014 | cbbank.com
Slide 41: Copy of presentation at www.
Copy of presentation at www.cbbank.com 3Q Results 2014 | cbbank.com