Central Pacific Financial Corp New · NYSE:CPF
Central Pacific Financial Corp New — Central Pacific Financial — Sandler O'Neill West Coast Financial Services Conference 2013
26 slides from Central Pacific Financial Corp New's conference presentation, Mar 4, 2013
Slide 1: Central Pacific Financial Corp
CENTRAL PACIFIC FINANCIAL CORP John C. Dean Denis K. Isono President & Chief Executive Officer EVP & Chief Financial Officer Sandler O’Neill West Coast Financial Services Conference March 5, 2013
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding our business expectations. Forward-looking statements can be identified by the fact that they do not relate s
Slide 3: Corporate Profile
Corporate Profile O Founded in 1954 by Japanese-American veterans of World War II. O Fourth largest financial institution in Hawaii with deposit market share of 10.6%. O $325 million recapitalization in February 2011. O TARP preferred stock converted to CPF common in February 2011; CPF exited TARP w
Slide 4: Branches on Major Islands
34 Branches on 4 Major Islands Kauai Kapaa @ Oahu Ogee Maui Kahului ee @ wees, Hawaii (millions) 7 {ilo Total assets $4,370 evs r Total loans $2,204 Total deposits $3,681 - Volcanoes Kalapana
Slide 5: Investment Considerations
Investment Considerations QU Experienced management team UU) Recovery opportunities despite operating environment UO Significantly strengthened credit profile Ol Attractive Hawaii market QO) Relative value opportunity 5 (CENTRAL PACIFIC FINANCIAL!
Slide 6: Executive Management Team
Executive Management Team Years with | Years in Title CPF Banking John Dean President & Chief Executive Officer Denis Isono EVP & Chief Financial Officer 10 By Bill Wilson EVP & Chief Credit Officer 3 19 Catherine Ngo EVP & Chief Administrative Officer 3 20 Lance Mizumoto EVP & Chief Banking Officer
Slide 7: Investment Considerations
Investment Considerations QO Experienced management team UU Recovery opportunities despite operating environment UO Significantly strengthened credit profile QO Attractive Hawaii market UO Relative value opportunity (CENTRAL PACIFIC FINANCIAL CORP
Slide 8: Recovery Opportunities Despite Environment
Recovery Opportunities Despite Environment Continue credit improvement Execute business development strategies Improve efficiencies Recognize deferred tax asset Normalize excess capital Building Shareholder Value 8
Slide 9: Recovery Opportunities Despite Environment
Recovery Opportunities Despite Environment Execute business development —_— Improve efficiencies strategies > Relationship Banking Strategy > Benchmarking Project > Specialized Markets > Evaluating Outsourcing > Customer Relationship Management > Vendor Management & System Consolidation > Realigning
Slide 10: 2012 Financial Highlights
2012 Financial Highlights O Reported net income of $47.4 million in 2012, a 30% increase over 2011. Eighth consecutive quarter of profitability since recapitalization. O Increased total loans by a $139.5 million, or 6.8% over 2011. O Grew noninterest-bearing demand deposits by $114.1 million, or 15.
Slide 11: Loan Portfolio
Annual Balance % Change Hawaii Residential Construction $29 1% $57 -$28 -49% Commercial Construction 48 2% 41 7 17% Commercial Mortgage 544 25% 555 -11 -2% Residential Mortgage 966 44% 845 121 14% C & I/Leasing ogy 11% 187 50 27% Consumer 143 6% 107 36 34% Total Hawaii Portfolio $1,967 89% $1,792 $1
Slide 12: High Quality Investment Portfolio
High Quality Investment olio ‘Mtge Rev Corporate Bonds 76: Agency Debt iE 17% > Municipal 10% QO $1.7 billion portfolio at 12/31/12. O 82% issued by US Agencies. neers O Portfolio weighted average life of MBS/CMO. Rts 3.9 years. \ QO Municipal & corporate bonds generally single-A rated or better. S
Slide 13: Strong Deposit Franchise
Strong Deposit Franchise Government CDs Noninterest- 11.8% Bearing DDA 22.99% CDs > $100M 6 6.5% CDs < $100M 8.3% Interest-Bearing DDA 18.3% Savings & Money Mkt 32.296 Q Total deposits of $3.7 billion at 12/31/12. No brokered deposits. (CENTRAL PACIFIC FINANCIAL CORP
Slide 14: Total Deposit Cost Advantage
Total Deposit Cost Advantage 3.50% 7555 3.00% 2.50% 2.43% 2.00% 1.50% 1.00% 0.50% sERe 0.30% 0.00% nt 5% a io 43 2007 2008 2009 2010 2011 1Q12 2Q12 3Q12 4Qu2 CPF mPeer : Peer group is comprised of publicly traded U.S. banks with total assets between $3-$5 billion. VL Financial (CENTRAL PACIFIC FINAN
Slide 15: Investment Considerations
Investment Considerations QO Experienced management team UO) Recovery opportunities despite operating environment UO Significantly strengthened credit profile QO) Attractive Hawaii market QO Relative value opportunity (CENTRAL PACIFIC FINANCIAL CORP
Slide 16: Reducing NPAs with Limited Losses
Reducing NPAs with Limited Losses ($ in Millions) For the Year Ended 09 12/31/2010 NPAs, beginning balance $61.5 $143.8 $499.8 $302.8 $195.6 Additions 283.3 694.3 240.3 798 46.6 Reductions: Return to performing 2.4) (31.7) (25.7) ) 6.2) Payments/Sales ) 91.5) 5) ) Charge-offs / Write downs ¢ ) (215.
Slide 17: Nonperforming Portfolio Marked to Market
Nonperforming Portfolio Marked to Market ($ in Millions) 12/31/2012 Net Balance NPA“ Losses Total Current = Netof _Effective Balance To Date UPB Reserves Reserves Mark Hawaii Residential Construction $9 $4 $13 so $9 69% Commercial Construction ° ° ° ° 0% Commercial Mortgage 3 fo) ¢ fo) 3 100% Reside
Slide 18: Strong Reserve Coverage
Strong Reserve Coverage 10.00% 8.89% 9.00% 8.00% 7.00% 6.00% 5.00% 4.00% 3.00% 2.00% 1.00% 0.00% 2007 2008 2009 2010 2011 1Q12 2Q12 3Q12 4Qu2 —=CPF <m=Peer Note: Peer group is comprised of publicly traded U.S. banks with total assets between $3-85 billion. Financial (CENTRAL PACIFIC FINANCIAI
Slide 19: Investment Considerations
Investment Considerations UO Experienced management team OU Recovery opportunities despite operating environment UO Significantly strengthened credit profile QO) Attractive Hawaii market UO) Relative value opportunity ES (CENTRAL PACIFIC FINANCIAL CORP
Slide 20: Hawaii Banking Market
Hawaii Banking Market (Sin millions) Total Market Rank Institution Ownership __ Branches __ Deposits Share 1 First Hawaiian Bank Bank Private - BNP 62 $ 12,891 37.0% 2 Bank of Hawaii Bank Public 75 11,566 33.2% a American Savings Bank Savings Bank Private - HEI 57 4,275 12.3% 4 Central Pacific Bank
Slide 21: Total Visitor Expenditures
Total Visitor Expenditures Forecast $18,000 ee 20.0% $16,000 cae. x a 15.0%. $14,000 AY = Py 10.0% $12,000 | | - — i— | $10,000 +— —— ee ee — oa 5.0% $8,000 | ss — |— 4 0.0% $6,000 +— NY J — |— “5.0% sa,ooo +] = = fi 7 -10.0% $2,000 + — c— — I $o + " _ + 715.0% 2005 2006 2007 2008 2009 2010 2011 201
Slide 22: Unemployment Rate Comparison
Unemployment Rate Comparison 12.0% National 10.0% Forecast 8.0% > 6.0% Hawaii 4.0% & 2005 2006 «= 2007 2008 = 20092010 pon 2012 2013 pou 2015 Haveli UnemploymentRete ——National Unemployment Rete Source: Historical data from US Bureau of Labor Statistics and Hawaii forecast from University of Hawaii
Slide 23: Investment Considerations
Investment Considerations QO Experienced management team OU Recovery opportunities despite operating environment UO Significantly strengthened credit profile QO) Attractive Hawaii market QO) Relative value opportunity (CENTRAL PACIFIC FINANCIAL CORP
Slide 24: Relative Value Opportunity
Relative Value Opportunity CPF Tangible Stock Price Book Value 12/31/2012 $15.59 $11.69 1.33 DTA Recognition $3.55 Pro Forma $15.24 1.02 Q) DTA recognition expected to begin in 1Q2013. Q) Full DTA recognition will add $3.55 to tangible book value per share. Q) At 12/31/12 stock price, CPF is trading
Slide 25: Investment Considerations
Investment Considerations QO Experienced management team OU Recovery opportunities despite operating environment UO Significantly strengthened credit profile QO) Attractive Hawaii market UO Relative value opportunity (CENTRAL PACIFIC FINANCIAL CORP
Slide 26: Central Pacific Financial Corp
© CENTRAL PACIFIC FINANCIAL CORP
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