Park National Corporation · AMEX:PRK
Park National — Sandler O'Neill Meetings (May 2017)
25 slides from Park National's conference presentation, May 17, 2017
Slide 1: May 17, 2017 Sandler O'Neill Meetings
May 17, 2017 Sandler O’Neill Meetings 1
Slide 2: Safe Harbor Statement
Safe Harbor Statement 2 Park cautions that any forward-looking statements contained in this presentation or made by management of Park are provided to assist in the understanding of anticipated future financial performance. Forward-looking statements provide current expectations or forecasts of futu
Slide 3: Park National Corporation (PRK) Profile
Park National Corporation (PRK) Profile (as of March 31, 2017) • 11 Community Bank Divisions • 2 Specialty Finance Companies • One non-bank workout subsidiary • 29 Ohio counties • 110 bank branches • 6 specialty finance offices • 1,751 FTEs 3
Slide 4: Park Executive Management
Park Executive Management David L. Trautman – President and CEO– Age: 56 President , CEO and Board Member of The Park National Bank and Park National Corporation (Park) headquartered in Newark, Ohio. He served as President of First-Knox National Bank, a division of The Park National Bank, from May
Slide 5: Park Executive Management (continued)
Park Executive Management (continued) Brady T. Burt – Chief Financial Officer – Age: 44 Chief Financial Officer of Park since 2012. Formerly served as the Chief Accounting Officer of Park from April 2007 to December 2012. Prior to joining Park, Mr. Burt served Vail Banks, Inc. in various capacitie
Slide 6: Experienced Leadership Team
Experienced Leadership Team Name Position Age Years with PRK Years In Industry David L. Trautman President & CEO 56 33 33 C. Daniel DeLawder Chairman 67 46 46 Matthew R. Miller Executive Vice President 38 8 14 Brady T. Burt Chief Financial Officer 44 10 16 Senior leadership consists of executives
Slide 7: Leadership Team – continued
Leadership Team – continued Name Position Age Years with PRK Years In Industry Adrienne M. Brokaw SVP – Director of Internal Audit 49 4 18 Thomas J. Button SVP – Chief Credit Officer 56 20 31 Thomas M. Cummiskey SVP – Trust 47 17 19 Kelly A. Edds VP – Chief Accounting Officer 34 7 12 Robert N. Kent,
Slide 8: Affiliate Leadership
Affiliate Leadership Name Position Age Years with PRK/Affiliate Years In Industry Brett A. Baumeister President – Unity National Bank 51 12 26 John A. Brown President – Security National Bank 48 25 25 David J. Gooch President – Park National Bank of Southwest Ohio & Northern Kentucky 48 19 25 Chris
Slide 9: Highlights of Q1 2017
Highlights of Q1 2017 • Loan growth of $41.8 million in Q1 2017 (3.24% annualized) at Park National Corporation’s (PRK) Ohio subsidiary, The Park National Bank (PNB). • Credit quality remains strong: PRK and PNB experienced net charge-offs of 12 basis points (bps) in Q1 2017. Delinquencies (30 days
Slide 10: ROA and ROE History
PRK and PRK, excluding Vision & Southeast Property Holdings, LLC (SEPH) ROA and ROE History 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
Slide 11: The bank of choice – Headquarter Counties Deposits
The Park National Bank – The bank of choice Source: SNL, June 30, 2016 Headquarter Counties – Deposits (in thousands) 11 Bank Division Year Joined Park Hdqtr. Co. Deposits Total County Deposits % of 2016 Market Share % of 2015 Market Share 2016 Headquarter County Market Share Rank 2015 Headquarter C
Slide 12: Park National Corporation Consolidated Statements of Income
Source: Company Filings 12 (in thousands) Mar. 31, 2017 Mar. 31, 2016 Dec. 31, 2016 Dec. 31, 2015 Net interest income $ 58,952 $ 59,819 $ 238,086 $ 227,632 Provision for (recovery of) loan losses 876 910 (5,101) 4,990 Net interest income after provision for (recovery of) loan losses $ 58,076 $ 58,90
Slide 13: Park National Corporation Consolidated Balance Sheets
Source: Company Filings 13 Park National Corporation Consolidated Balance Sheets (in millions) Mar. 31, 2017 Dec. 31, 2016 Dec. 31, 2015 Cash & cash equivalents $ 392 $ 146 $ 149 Investment securities 1,565 1,580 1,644 Loans 5,314 5,272 5,068 Allowance for loan losses (50) (51) (56) Other assets 523
Slide 14: Quarterly Net Income by Operating Segment
Quarterly Net Income by Operating Segment Source: Company Filings (In thousands) Q1 2017 Q1 2016 2016 2015 2014 PNB $21,486 $21,744 $84,451 $84,345 $82,907 GFSC 198 (1,836) (307) 1,423 1,175 Park Parent Company 1 (1,226) (1,834) (4,557) (4,549) (5,050) Ongoing operations $20,458 $18,074 $79,587 $81,
Slide 15: Consolidated Statements of Income
Source: Company Filings 15 The Park National Bank Consolidated Statements of Income (in thousands) Mar. 31, 2017 Mar. 31, 2016 Dec. 31, 2016 Dec. 31, 2015 Net interest income $ 57,480 $ 57,155 $ 227,576 $ 220,879 Provision for loan losses 720 1,533 2,611 7,665 Net interest income after provision for
Slide 16: Statement of Condition
Park National Bank Statement of Condition Source: Company Filings (In thousands) March 31, 2017 December 31, 2016 March 31, 2016 % change from 12/31/16 % change from 3/31/16 Loans $5,276,643 $ 5,234,828 $5,023,659 0.80% 5.04% Allowance for loan losses 47,983 48,782 54,646 (1.64%) (12.19%) Net loans
Slide 17: Loans by Type
Park National Bank Loans by Type Source: Company Filings as of March 31, 2017 • 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 for dec
Slide 18: Indirect Loans
18 Park National Bank Indirect Loans Source: Company Filings Dec. 31, 2014 Dec. 31, 2015 Dec. 31, 2016 Mar. 31, 2017 Other $151,489 $154,172 $106,872 $104,537 Boat/RV $32,821 $68,096 $138,483 $148,323 Auto $507,245 $541,307 $668,018 $727,843 Total Indirect Loans $691,555 $763,575 $913,373 $980,703 $
Slide 19: Park National Corporation Nonperforming assets
Park National Corporation Nonperforming assets 1 The carrying balance of impaired commercial loans as a percentage of unpaid principal balance at March 31, 2017 was 73.5% and 51.8% for Park National Corporation and SEPH, respectively. 2 At March 31, 2017, Vision/SEPH participations included in Park
Slide 20: Nonperforming assets (PNB and Guardian)
Source: BHC Performance Report and Company Filings (in thousands) Mar. 31, 2017 Dec. 31, 2016 Dec. 31, 2015 Non-accrual loans $ 72,780 $ 76,084 $ 81,468 Renegotiated loans 21,153 18,175 24,979 Loans past due 90 days or more (still accruing) 1,837 2,086 1,921 Total nonperforming loans $ 95,770 $ 96,3
Slide 21: PRK comparison to peers
PRK comparison to peers 1 Due to unavailability of 1Q 2017 peer median financial metrics, data utilized herein reflects 4Q 2016 peer results. Source: Company Filings and SNL data of $3 to $10 billion bank holding companies PRK Price to Book % Peer Group Price to Book % PRK Price to tangible book Pee
Slide 22: A Successful History of Disciplined Strategic Growth in Ohio
A Successful History of Disciplined Strategic Growth in Ohio (11 acquisitions; 2 De Novos) 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 Company
Slide 23: PRK M&A Strategy
PRK M&A Strategy Two prong strategy guidelines: • Traditional M&A • Strong franchise, good reputation • Good market share • Existing leadership continuity • Traditional community bank structure • Core deposits • Metro Strategy – Attractive markets in the Midwest / Southeast / Mid-Atlantic states • O
Slide 24: 2017 PRK Agenda
2017 PRK Agenda 24 A. Increase Net Income >= $90 million B. Maintain common dividend at historic rate C. Perform in upper quintile of $3-$10 billion bank holding company peer group D. Reduce PRK NPA’s from $122 million to $85 million E. Cultivate and respond promptly to M & A possibilities
Slide 25: May 17, 2017 Sandler O'Neill Meetings
May 17, 2017 25 Sandler O’Neill Meetings