First Financial Bancorp. · NASDAQ:FFBC
First Financial Bancorp — Investor Presentation (June 2010)
42 slides from First Financial Bancorp's investor presentation, Jun 22, 2010
Slide 1: First Financial Bancorp Investor Presentation
fiRST first financial bancorp First Financial Bancorp Investor Presentation Financial Data as of March 31, 2010 EXHIBIT 99.1
Slide 2: Forward-looking statements
This presentation should be read in conjunction with the consolidated financial statements, notes and tables in First Financial Bancorp’s most recent ‘Annual Report on Form 10-K for the year ended December 31, 2009, as well as financial information in other public documentation filed with the ‘Secur
Slide 3: Business & Strategy Review
fiRST first financial bancorp Business & Strategy Review
Slide 4: Corporate Overview
Corporate Overview * First Financial Bank, N.A. founded in 1863 Hee Business Units Total Deposits: $5.2 billion 113 banking centers in Ohio, Indiana, Kentu — Commercial gone ee — Retail ‘Trading Statistics * — Wealth Management Nasdaq: FFBC — Franchise Finance Shares Outstanding: 57.8 million : : Ma
Slide 5: Strategic rebuilding and reorganization plan since 2005
= 16 bank/thrift acquisitions from 1989 through 1999 resulted in multiple bank charters and brand identities = Established Strategic (Rebuilding & Reorganization) Plan in March 2005 Consolidated and streamlined company to establish one charter and one brand identity Restructured credit process Restr
Slide 6: Top-quartile performance for all stakeholders
= Top-quartile performance for all stakeholders =" Sustained and consistent excellence = Commitment to growth = Effective management of all risks Another step on the path to success.
Slide 7: Strong operating fundamentals through the recessionary period
Strong operating fundamentals have produced positive results throughout the recessionary period Strong market share in strategic operating markets Low risk balance sheet with significant liquidity sources Capital significantly exceeds “well- capitalized” Solid organic loan and deposit growth Credit
Slide 8: Client "Intimate" Strategy
Client “Intimate” Strategy — Strategic Focus: build long-term relationships with clients by identifying and meeting their financial needs Four lines of business — Commercial — Retail — Wealth Management — Franchise Finance Target clients — Individuals and small / mid-size businesses located within t
Slide 9: Selective Acquisitions
fiRST first financial bancorp Selective Acquisitions Future = Supplements organic growth strategy in core markets Irwin Continue to evaluat (FDIC) opportunities in this yy il i PETIT TCE | dislocated market; Core philosophy and strategy remains unchanged pt nanan isrseGhTer core franchise = Transact
Slide 10: Acquisition rationale and low-risk transactions
= Consistent with the company’s stated conservative strategy = Acquisitions are compelling relative to cost and time to build profitable de novo banking centers = Adds banking centers in key areas that will leverage the First Financial brand to increase market share — Compliments existing locations
Slide 11: Acquisitions provided market expansion opportunities
first financial bancorp = Acquisitions provided market expansion opportunities in key locations — Added 39 banking centers in strategic operating markets — Solidifies position in key markets and accelerates market expansion strategy by several years — 4th largest banking center network in Cincinnati
Slide 12: Integration of Peoples and Irwin acquisitions completed
= Integration of core operations of Peoples Community Bank and Irwin acquisitions completed — No significant issues — Deposit client retention rates higher than expected = Developed a dedicated covered asset and loss share management team comprised of credit, legal and finance — Process is scalable
Slide 13: Organic growth in key regional markets
= Primary focus and value creation is through organic growth in key regional markets — 2009 expansion included opening additional banking centers, including growth within strategic operating markets * Significant advancement in key areas with the addition of 39 banking centers through acquisitions *
Slide 14: First quarter 2010 highlights
= Quarterly net income of $9.7 million, or $0.17 per diluted common share, an increase of 21% over the first quarter 2009 earnings per diluted share of $0.14. - Excluding expenses related to non-strategic operations and acquisition- and transition-related costs, offset by gains associated with sales
Slide 15: Follow-on equity offerings
= February 2010 follow-on equity offering Issued 6.4 million shares at $15.14 per share Net proceeds of approximately $91 million after deducting underwriting discounts, commissions and estimated offering expenses Positioned the company to redeem the $80 million preferred shares issued to the U.S. T
Slide 16: Strong capital base
ancorp = Committed to maintaining a strong capital base = Strong capitalization levels remain among industry leaders and can support sizeable asset growth = Long-term targeted dividend payout range is between 40% and 60% of earnings available to common shareholders = Capital generated from acquisiti
Slide 17: Net interest margin expansion
bancorp Continued net interest margin expansion Increased yield on earning assets driven by yield on covered loans and improved pricing on new loan originations Strong core deposit base and liquidity provide less reliance on wholesale borrowings Consistently low funding costs Net Interest Margin 4.6
Slide 18: Total Loan Portfolio
fiRST first financial bancorp Total Loan Portfolio - March 31, 2010 3% 1% 26% 13% 6% 45% Commercial Real estate - construction Realestate - commercial meal estate - residential Home equity installment and other Loan Composition Covered Loans - $1.8 (at estimated fair value) 1% 16% 54% Uncovered Loan
Slide 19: Uncovered Loans - RE Collateral
fiRST Uncovered Loans — RE Collateral first financial bancorp Total Uncovered Loan Portfolio — March 31, 2010 $2.8 Billion 5% $216,289 38% Dollars in millions Non-owner occupied 1m Owner occupied Real estate - construction _ a Real estate - commercial Acquisition & land development 1 Excludes loans
Slide 20: Credit quality trends
= 39.4% of total loans covered under FDIC loss share agreement = Increased credit costs, while manageable, reflect the continued adverse impact of the prolonged downturn = Stress primarily in commercial, construction and CRE portfolios = Will maintain a higher provision expense and reserve until the
Slide 21: Credit metrics versus peers
"Excludes loans covered by FDIC loss sharing agreements bancorp NPLs / Loans NCOs / Average Loans & Leases 100% 150% 120% 0.90% 0.60% 0.30% 0.00% Reserves / NPLs Texas Rati Pee cup comptes ot proxy + BACS win al asses of 53-510 Bon consent in epee gu hees me SHC Petomance Repo fone Conany pee Fecal
Slide 22: Investment portfolio
t financial bancorp Datwcn noir) Yous oa YP ate UST notes & agencies: $24,423 46% 374 99.78 10246 $ 643, ‘CMOs (agency) 52,557 9.8% 461 100.46 104.68 2415 (CMOs (private) 58 0.0% 0.94 100.00 100.07 0 MBSs (agency) 340,667 63.6% 461 100.93, 105.35 14,303 417,705 78.0% T56 700.80 105.09 17.061 ‘Munici
Slide 23: Investment portfolio sector allocation and credit quality
As of March 31, 2010 Sector Allocation Credit Quality Investment Grade MBSs (Agency) 95% 63% Municipal 4% CMOs (Private), 0% US.T.Notes & Other Investment Agencies ~ Gade 5% 1% * Other includes regulatory stock rated securities Other Investment Grade = 8 rated securities Another step on the path to
Slide 24: Deposit Activity
first financial Deposit Activity - First 2010 (Dollars in thousands) Transaction and savings accounts $3,121,140 «$= 63,414. $_~— (98,551) $3,088,003 Time deposits 1,864,215, (17,207) (38,882) 1,808,126 Brokered deposits 365,285 10,213 (47,941) 327,557 Total deposits “S_5,350,640_ $50,420 S$ (183,37
Slide 25: Funding Structure and Cost of Funds
fiRST Funding Structure and Cost of Funds first financial bancorp Average Interest Bearing Liability Balances End of Period Deposit Composition Total Cost of Funds 19% 19% 19% 19% io = ws to wo w a 29% af are | 2s 201 oe won oes oes $ S| os%] 24% 4.1% 0.7%) 23% 0.7%) 25% 5 20% g wen ox oo a oan] 2%
Slide 26: Borrowed Funds Activity
(Dollars in thousands) Short-term borrowings: Federal funds purchased and securities sold under agreements to repurchase Long-term borrowings: Federal home loan bank advances * Securities sold under agreements to repurchase Other Total long-term borrowings Total borrowings " Includes market value ad
Slide 27: Covered Assets and Acquisition-Related Items
fiRST first financial bancorp Covered Assets and Acquisition-Related Items
Slide 28: Revenue by Source
fiRST Revenue by Source first financial bancorp Total Revenue: $91.4 million For the Three Months Ended March 31, 2010 (Dollars in millions) = Strategic — Elements of the business that either existed prior to the acquisitions or were acquired with the intent to retain and grow. Approximately 81% of
Slide 29: Deposit and Loan Composition
fiRST first financial bancorp Deposit and Loan Composition Total Deposits = $5.2 Gross Loans = $4.6 billion As of March 31, 2010 As of March 31, 2010 (Dollars in millions) (Dollars in millions) Strategic TD Acquired-Non-Strategic = Wester market (acquired-non-strategic) branch exit is largely comple
Slide 30: Valuation adjustments on covered loans
fiRST first financial bancorp 15% Credit-based valuation adjustment - FFBC Credit-based valuation adjustment ‘covered by FDIC indemnification Rate-based valuation adjustment Approximate values at acquisition date (millions): Credit-based adjustment covered by FDIC - $240* Credit-based adjustment pro
Slide 31: Credit performance scenarios and valuation adjustment reversal
Scenario | - Better than expected credit performance Reversal of Valuation Adjustments Credle based Offet Income Statement Impact Unpaid Principal roic ‘Additional FOIC by FDIC Non interest Non Interest Balance (UPB) Disposition Value __—Ratebased __Credithased__indemnfcation Indemnification __indem
Slide 32: Noninterest Income Impact of Valuation Adjustments
Noninterest Income Impact of Components of Valuation Adjustments Accelerated Discount Recognition Estimated as of March 31, 2010 For the Three Months Ended March 31, 2010 (Dollars in millions) (Dollars in millions) $8.2 $54 4q09 1010 1 Credit-based valuation adjustment tm Rate-based valuation adjust
Slide 33: Noninterest Expenses
fiRST first financial bancorp Noninterest Expenses Components of Noninterest Expense FDIC Support Expenses For the Three Months Ended March 31, 2010 Estimated 10 Year Trend (Dollars in millions) 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Strategic 1m Acquired-non-strategic TOFDIC support 1 Ot
Slide 34: Noninterest Income and Expense
Noninterest Income (Dots in thousands) ‘Total noninterest income ‘Accelerated discount on loan prepayments ‘and dispositions Rate-based valuation mark - oan sales Rate-based valuation mark - prepayments (Crecit-based valuation mark - loan sales" CCrecit-based valuation mark - prepayments? ‘Total acc
Slide 35: Income and expense effect of acquired-non-strategic items
rst financial bancorp (Datars in thousands) Income effect: ‘Accelerated discount on loan prepayments and Gispostions'* Rate-basad valuation mark -loan sales RRate-basad valuation mark - prepayments CCredi-based valuation mark -loan sales? CCredit-aased valuation mark - prepayments? ‘Acquired-nen-sra
Slide 36: Covered Loan Activity - First Quarter 2010
Covered Loan Activity - First Quarter 2010, (Dollars in thousands) 10 Commercial 8 509727 S$ 7.288 § 25,304 12,945 3421 § 480,681 Real estate - construction 86,810 7 4,287 4,092 2,304 79,127 Real estate - commercial 4,012,173 13,889 18,279 229 795 978,981 Real estate - residential 291,210 - 5,588 11
Slide 37: Leadership
fiRST first financial bancorp Leadership
Slide 38: Claude E. Davis and C. Douglas Lefferson
Claude E. Davis President & Chief Executive Officer Mr. Davis joined First Financial in 2004 as President, Chief Executive Officer and a member of the Board of Directors. Mr. Davis also serves as Chairman of the Board of Directors of First Financial Bank. Prior to joining the company, he served as S
Slide 39: Michael Cassani and Gregory Gehlmann
ncorp Michael Cassani Executive Vice President, Wealth Resource Group Mr. Cassani joined First Financial in 2007 as Senior Vice President and Chief Administrative Officer to oversee the company's Wealth Resource Group. Prior to joining the company, Mr. Cassani served as President of Fund Project Ser
Slide 40: L. Wyman and Kevin T. Langford
ncorp L. Wyman executive Vice President, Co-Chief Retail Banking Officer Ms. Wyman joined First Financial in 2003 as Vice President and Sales Director. In her current position, Ms. Wyman has responsibility for leading the retail sales process, growing retail deposits and enhancing the sales culture
Slide 41: John Sabath and Anthony M. Stollings
John Sabath Senior Vice President, Chief Risk Officer Mr. Sabath joined First Financial in 2005 as Regulatory Risk Manager. Mr. Sabath was then promoted to Senior Risk Officer and First Vice President and assumed his current position in 2008. He is responsible for management of the Company's risk ma
Slide 42: Another step on the path to success
fiRST first financial bancorp Another step on the path to success
First Financial Bancorp — Investor Presentation (June 2010) on 6ix