Park National Corporation · AMEX:PRK
Park National — Sandler O'Neill Park Investor Meetings (November 2013)
32 slides from Park National's conference presentation, Nov 13, 2013
Slide 1: Sandler O'Neill Park Investor Meetings
1 November 13, 2013 Sandler O’Neill Park Investor Meetings
Slide 2: Forward-looking Statements
Forward-looking Statements • This presentation presents management's discussion and analysis of the financial condition and results of operations for Park National Corporation and its subsidiaries ("Park" or the "Corporation"). This discussion should be read in conjunction with the consolidated fina
Slide 3: Park National Corporation (PRK) Profile
3 Park National Corporation (PRK) Profile (as of September 30, 2013) • 11 Community Bank Divisions • 2 Specialty Finance Companies • One non-bank workout subsidiary • 29 Ohio & 1 Kentucky counties • 124 bank branches • 7 specialty finance offices • 1,831 FTEs
Slide 4: Park Executive Management
Park Executive Management C. Daniel DeLawder – Chairman and Chief Executive Officer – Age: 64 Chairman, Chief Executive Officer (1999) and Board Member of The Park National Bank and Park National Corporation (Corporation or Park) headquartered in Newark, Ohio. He served previously as President of
Slide 5: Park Executive Management (continued)
Park Executive Management (continued) Brady T. Burt – Chief Financial Officer – Age: 41 Chief Financial Officer of Park since 2012. Formally served as the Chief Accounting Officer with Park since April 2007. Prior to joining Park, Mr. Burt served Vail Banks, Inc. in various capacities, including E
Slide 6: Experienced Leadership Team
6 Experienced Leadership Team Name Position Age Years with PRK Years In Industry C. Daniel DeLawder Chairman & CEO 64 42 42 David L. Trautman President 52 30 30 Brady T. Burt Chief Financial Officer 41 6 12 Senior leadership consists of executives with proven local market experience Leadership t
Slide 7: Leadership Team – continued
7 Leadership Team – continued Name Position Age Years with PRK Years In Industry Adrienne M. Brokaw SVP – Director of Internal Audit 45 1 15 Thomas J. Button SVP – Chief Credit Officer 53 16 27 Thomas M. Cummiskey SVP – Trust 44 14 16 Lynn B. Fawcett SVP – Operations 54 23 23 Robert N. Kent, Jr. Pre
Slide 8: Affiliate Leadership
8 Affiliate Leadership Name Position Age Years with PRK/Affiliate Years In Industry John A. Brown President – Richland Bank 44 22 22 Brett A. Baumeister President – Unity National Bank 47 9 23 William C. Fralick President – Security National Bank 59 37 37 David J. Gooch President – Park National Ban
Slide 9: Highlights of the First Nine Months of 2013
9 Highlights of the First Nine Months of 2013 • Since the sale of the Vision business on February 16, 2012, Vision Bank legacy NPAs have been reduced $56.1 million. • Net income totaled $59.8 million ($3.88 per diluted common share) for the first nine months of 2013, compared to $44.5 million or $2.
Slide 10: Vision and SEPH NPA Trend
Vision and SEPH NPA Trend 10 Source: Company Filings 12/31/10 12/31/11 02/16/12 09/30/13 Vision/SEPH NPA's $205.1 $130.4 $117.8 $61.7 0 25 50 75 100 125 150 175 200 225 In m ill io n s ($ )
Slide 11: ROA and ROE History – PRK and PRK, excluding Vision & SEPH
11 ROA and ROE History – PRK and PRK, excluding Vision & SEPH Results Count 1 Calculated using average common equity for Park National Corporation. 2 Calculated using average common equity for Park National Corporation, excluding Vision Bank and SE Property Holdings, LLC. 3 Adjusted for goodwill imp
Slide 12: Headquarter Counties – Deposits and Market Share
12 Bank Division Year joined Park Hdqtr. Co. deposits Total county Deposits Park % of 2013 market share Park % of 2012 market share Park National 1908 $ 1,213,870 $ 2,083,268 58.3% 57.8% Fairfield National 1985 372,869 1,816,712 20.5% 21.8% Richland Bank 1987 451,558 1,705,766 26.5% 27.2% Century Na
Slide 13: Quarterly Net Income by Operating Segment
Quarterly Net Income by Operating Segment 13 Source: Company Filings (In thousands) 2011 2012 Q3 YTD 2012 1 Q3 YTD 2013 Q1 2013 Q2 2013 Q3 2013 PNB $ 106,851 $ 87,106 $ 67,112 $ 57,511 $ 19,940 $ 20,322 $ 17,249 GFSC 2,721 3,550 2,686 2,261 740 790 731 Park Parent Company (1,595) 195 457 79 132 191
Slide 14: Projection of Fiscal 2013 Results
14 Projection of Fiscal 2013 Results Source: Company Filings Projected Net Income (In thousands) Original projection for 2013 75% of midpoint Q3 YTD 2013 Current projection for 2013 Pre-tax, pre-provision income $ 113,000 $ 131,000 $ 91,500 $ 83,241 $ 109,500 $ 112,500 Provision for loan losses 20,0
Slide 15: The Park National Bank Income Statement
15 Source: Company Filings The Park National Bank Income Statement (In thousands) 2011 2012 Q3 YTD 2012 Q3 YTD 2013 Q1 2013 Q2 2013 Q3 2013 Net interest income $ 236,282 $ 221,758 $ 167,234 $ 156,819 $ 52,735 $ 51,736 $ 52,348 Provision for loan losses 30,220 16,678 12,553 11,591 3,130 2,122 6,339 F
Slide 16: Park National Bank Statement of Condition
Park National Bank Statement of Condition 16 Source: Company Filings (In thousands) Sept. 30, 2012 Dec. 31, 2012 Sept. 30, 2013 % change from 12/31/12 % change from 9/30/12 Loans $ 4,311,117 $ 4,369,173 $ 4,508,156 3.18% 4.57% Allowance for loan losses 53,145 53,131 55,425 4.32% 4.29% Net loans 4,25
Slide 17: SEPH / Vision Bank Income Statement
17 Source: Company Filings SEPH / Vision Bank Income Statement (In thousands) Vision/SEPH 2011 2012 YTD Q3 2012 YTD Q3 2013 Q1 2013 Q2 2013 Q3 2013 Net interest income $ 26,104 $ (341) $ 597 $ (1,464) $ (655) $ (347) $ (462) Provision for (recovery of) loan losses 31,052 17,882 17,044 (8,866) (3,011
Slide 18: Park National Bank Loans by Type
18 Park National Bank Loans by Type Source: Company Filings as of September 30, 2013 • Commercial lending focus is on small, closely-held businesses within our markets. • Consumer mortgage and home equity portfolios are originated by Park within our footprint and have been consistently underwritten
Slide 19: Nonperforming Loans by Type
19 Park National Corporation Nonperforming Loans by Type At September 30, 2013 Source: Company Filings as of September 30, 2013 PNB Guardian SEPH LLC PRK Amount Percentage Amount Percentage Amount Percentage Amount Percentage Commercial Real Estate Owner Occupied $ 20,142 16.73% $ - 0.00% $ 6,123 15
Slide 20: Park National Corporation Nonperforming Assets
20 Park National Corporation Nonperforming assets Source: BHC Performance Report and Company Filings (in thousands) Dec. 31, 2011 Dec. 31, 2012 Sept. 30, 2013 Non-accrual loans $ 195,106 $ 155,536 $ 136,470 Renegotiated loans 28,607 29,800 24,398 Loans past due 90 days or more (still accruing) 3,489
Slide 21: Vision Bank/SE Properties Holdings Nonperforming Assets
21 Vision Bank/SE Properties Holdings Nonperforming Assets Source: BHC Performance Report and Company Filings (in thousands) Dec. 31, 2011 Dec. 31, 2012 Sept. 30, 2013 Non-accrual loans $ 98,993 $ 55,292 $ 39,348 Renegotiated loans 2,265 - - Loans past due 90 days or more (still accruing) 122 - - To
Slide 22: PNB and Guardian Nonperforming Assets
22 Source: BHC Performance Report and Company Filings (in thousands) Dec. 31, 2010 Dec. 31, 2011 Dec. 31, 2012 Sept. 30, 2013 Non-accrual loans $ 117,815 $ 96,113 $ 100,244 $ 97,122 Renegotiated loans - 26,342 29,800 24,398 Loans past due 90 days or more (still accruing) 3,226 3,367 2,970 1,654 Tota
Slide 23: PRK Impaired Loan Summary
PRK Impaired Loan Summary 23 Source: Company Filings Park National Corporation Impaired Commercial Loans at September 30, 2013 (In thousands) Unpaid principal balance (UPB) Prior charge- offs Total impaired loans Specific reserve Carrying balance Carrying balance as a % of UPB PNB $ 116,926 $ 36,464
Slide 24: Park National Bank Commercial Loan Portfolio Trends
Park National Bank Commercial Loan Portfolio Trends 24 1 Commercial loans include: (1) Commercial, financial and agricultural loans, (2) Commercial real estate loans, (3) Commercial related loans in the construction real estate portfolio and (4) Commercial related loans in the residential real estat
Slide 25: Park National Corporation – Income Statement
25 Park National Corporation – Income Statement Source: Company Filings (in thousands) Dec. 31, 2011 Dec. 31, 2012 Q3 2013 YTD Net interest income $ 273,234 $ 235,315 $ 165,125 Provision for loan losses 63,272 35,419 3,500 Net interest income after provision $ 209,962 $ 199,896 $ 161,625 Fee Income
Slide 26: Park National Corporation Statement of Condition
PARK NATIONAL CORPORATION Statement of Condition 26 Source: Company Filings (in millions) Dec. 31, 2011 Dec. 31, 2012 Sept. 30, 2013 Investment securities $ 1,708 $ 1,582 $ 1,389 Loans 4,317 4,450 4,574 Allowance for loan losses (68) (56) (58) Assets held for sale 382 - - Other assets 633 667 801 To
Slide 27: PRK comparison to peers
27 PRK comparison to peers * Calculated for the twelve months ended September 30, 2013. ** Annualized based on dividends and stock price through September 30, 2013. Source: Company Filings and SNL data of $3 to $10 billion bank holding companies PRK Price to Book % Peer Group Price to Book % PRK Pri
Slide 28: PRK short interest position
PRK short interest position 28 Date Short Interest Position PRK Closing Price Average Annual Daily Volume Days to Cover Short Position 09/30/2013 720,858 $ 79.08 38,979* 18.5 12/31/2012 1,212,786 $ 64.63 32,095 37.8 12/30/2011 1,654,098 $ 65.06 50,130 33.0 12/31/2010 922,074 $ 72.67 38,840 23.7 12/3
Slide 29: PRK short interest comparison to peers
PRK short interest comparison to peers As of Sept 30, 2013 29 Entity Shares Outstanding Short Interest Position Average Daily Volume in 2013 Days to Cover Short Interest as a % of Total Shares Outstanding PRK 15,411,963 720,858 38,979 18.5 4.68% Midwest Peer Median 54,961,538 1,905,310 202,349 9.4 3
Slide 30: A Successful History of Disciplined Strategic Growth in Ohio
A Successful History of Disciplined Strategic Growth in Ohio (11 acquisitions; 2 De Novos) 30 1908 1908 The Park National Bank is established 1985 1985 Acquisition of Fairfield National Bank 1987 1987 Park National Corporation holding company is established Acquisition of Richland Trust Comp
Slide 31: Growth Opportunities
Growth Opportunities PRK successfully completed 11 Ohio- based financial institution mergers from 1985 through 2006. Each bank operates within PRK in an autonomous fashion; each bank retains its local community bank identity, leadership team, and advisory board of directors. Future Merger Object
Slide 32: Sandler O'Neill Park Investor Meetings
32 November 13, 2013 Sandler O’Neill Park Investor Meetings
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