Central Pacific Financial Corp New · NYSE:CPF
Central Pacific Financial Corp New — Central Pacific Financial — IPO Roadshow (July 2009)
38 slides from Central Pacific Financial Corp New's IPO roadshow presentation, Jul 14, 2009
Slide 1: Common Stock Offering July 2009 Investor Presentation
Common Stock Offering July 2009 Investor Presentation Ronald K. Migita, Chairman, President & Chief Executive Officer Dean K. Hirata, Vice Chairman & Chief Financial Officer
Slide 2: Forward-Looking Statements
2 Forward-Looking Statements This presentation may contain forward-looking statements concerning projections of revenues, income or loss, earnings or loss per share, capital expenditures, dividends, capital structure, or other financial items, concerning plans and objectives of management for future
Slide 3: Notice to Investors
3 Notice to Investors The Company proposes to issue the common shares pursuant to a prospectus supplement that will be filed as part of an existing shelf registration statement previously filed with the Securities and Exchange Commission on Form S-3. The offering may be made only by means of a prosp
Slide 4: Equity Offering Overview
4 Equity Offering Overview Central Pacific Financial Corp. (NYSE: CPF) Issuer Offering Size Greenshoe Use of Proceeds Bookrunner $100 million 15% over-allotment option General corporate purposes, which may include contributing all or substantially all of the net proceeds to Central Pacific Bank Sand
Slide 5: Equity Offering: Objectives
5 Equity Offering: Objectives Significantly strengthen capital position. Pro forma leverage ratio of 12.5%. 1 Pro forma tangible common equity ratio of 7.5%. 1 Offering size determined through in depth stress testing of loan portfolio using internal tests, outside benchmarks and Supervisory Capital
Slide 6: Corporate Profile
6 Corporate Profile Central Pacific Bank was founded in 1954 by Japanese- American veterans of World War II. CPF is one of the largest financial institutions in Hawaii with $5.5 billion in assets, $3.7 billion in loans and $4.0 billion in deposits as of June 30, 2009. CPF has 39 branches and more th
Slide 7: Preliminary Q2 2009 Results & Recent Developments
7 Preliminary Q2 2009 Results & Recent Developments Expects to report net loss of approximately $33 million to $37 million, or $1.22 to $1.35 per diluted share. Increased core deposits by $202 million, or 6.7% over the first quarter of 2009. Originated $558 million in residential mortgage loans in H
Slide 8: Investment Considerations
8 Investment Considerations Focus on credit risk management Strengthened capital position Disciplined liquidity management Strong, low cost deposit franchise Hawaii market opportunity
Slide 9: Focus on Credit Risk Management
9 Focus on Credit Risk Management New Credit Administration Team and strengthened risk management infrastructure. Appointed a new interim Chief Credit Officer in June 2009 with more than 28 years of Credit Administration and Risk Management experience. Expanded our Special Credits group to 12 profes
Slide 10: Strong Level of Allowance for Loan Losses
10 Strong Level of Allowance for Loan Losses Loan Loss Reserves / Loans 1.3% 1.6% 1.8% 1.8% 1.9% 2.0% 2.5% 2.5% 3.1% 4.4-4.6% 3.2% 0.0% 1.0% 2.0% 3.0% 4.0% 5.0% WABC UMPQ CVBF PACW WAL BANR PCBC HAFC FTBK CPF 1Q09 CPF 2Q09 Data as of 3/31/09, except as noted. Peers include the 10 largest publicly tr
Slide 11: Loan and Credit Quality Composition
11 Loan and Credit Quality Composition As of 6/30/09, $ in thousands % of Nonaccrual/Losses Outstanding Outstanding Nonaccrual Outstanding 30-89 Days 90+ Days Since Balance Balance Loans Balance OREO Delinquent Delinquent 1/1/2008 1 Hawaii Residential Construction 362,566 $ 10% 50,277 $ 14% - $ 3,49
Slide 12: Loans Delinquent for 90 Days or More Still Accruing Interest
12 Loans Delinquent for 30 Days or More Still Accruing Interest ($ outstandings in thousands) 6/30/2009 3/31/2009 Loans Delinquent for 90 Days or More Mainland Construction - $ 6,916 $ Commercial Mortgage - 11,771 Hawaii Construction - - Commercial Mortgage - - Residential Mortgage 3,755 1,288 Comme
Slide 13: Nonperforming Asset Detail
13 Nonperforming Asset Detail ($ outstandings in thousands) 6/30/2009 3/31/2009 12/31/2008 Nonaccrual Portfolio Loans Mainland Residential Construction 41,761 $ 45,050 $ 38,871 $ Commercial Construction 71,547 48,653 48,687 Commercial Mortgage 12,150 - - Hawaii Residential Construction 50,277 15,767
Slide 14: High Quality Investment Portfolio
14 High Quality Investment Portfolio $1.1 billion investment portfolio. 89% rated AAA or government-backed. No CDOs, CMBS, TRUPs or preferred securities. Agency MBS 61% Municipals 10% US Government Agency Debt 19% Other 1% Non-Agency MBS 9% Data as of 6/30/09.
Slide 15: Strengthened Capital Position
15 Strengthened Capital Position 1 Pro forma assumes completion of common equity raise of $100 million gross proceeds. 2 Peer data as of 3/31/09. Western peers include the 10 largest publicly traded western banks with total assets less than $10 billion. Source: SNL Financial CPF CPF 6/30/2009 Wester
Slide 16: CPF SCAP Analysis
16 CPF SCAP Analysis ¹ Indicative loss rates based on the average of the ranges disclosed by the Board of Governors of the Federal Reserve System (2009) “The Supervisory Capital Assessment Program: Overview of Results”. ² Excludes loans held for sale of $63.1 million as of March, 31, 2009. Source: F
Slide 17: Pro Forma Capital Under SCAP Assumptions
17 Pro Forma Capital Under SCAP Assumptions Loss assumptions based on March 31, 2009 loan balance of $3.8 billion; excludes life-to-date write down of $52.7 million. Target ALLL/loans ratio of 2.00% at March 31, 2011. Q2’ 09 through Q1’ 11 pre-tax, pre-provision net revenue of $173 million based on
Slide 18: Disciplined Liquidity Management
18 Disciplined Liquidity Management Core deposits increased by $202 million, or 6.7%, from March 31, 2009. Deposits fund 72% of total assets at 6/30/09. Loan to deposit ratio reduced to 93% at 6/30/09. Minimal reliance on brokered CDs. Strong liquidity position with over $1.2 billion in available bo
Slide 19: Deleveraging the Balance Sheet
19 Deleveraging the Balance Sheet Peer data as of 3/31/09. Peers include the 10 largest publicly traded western banks with total assets less than $10 billion. Source: SNL Financial Loan-to-Deposit Ratio 100% 93% 95% 103% 108% 104% 110% 103% 98% 93% 60% 70% 80% 90% 100% 110% 120% 2004 2005 2006 2007
Slide 20: Strong Deposit Franchise
20 Strong Deposit Franchise Total deposits of $4.0 billion. Core deposits of $3.2 billion or 80% of total. Average deposit cost of 1.35% for the quarter ended March 31, 2009. Average deposit cost declined by approximately 17bps to 1.18% in the second quarter of 2009. CDs over $250,000 total $169 mil
Slide 21: Attractive Deposit Funding
21 Attractive Deposit Funding Peer data as of 3/31/09. Peers include the 10 largest publicly traded western banks with total assets less than $10 billion. Source: SNL Financial Total Deposit Cost 2.43% 1.55% 1.51% 1.52% 1.95% 1.95% 1.12% 0.75% 1.35% 1.18% 0.00% 0.50% 1.00% 1.50% 2.00% 2.50% 3.00% 20
Slide 22: Deposit Growth Through Innovative Products
22 Deposit Growth Through Innovative Products Innovative and attractive deposit products. Community-Based Banking philosophy to broaden and deepen relationships. Superior, personalized service is the differentiator.
Slide 23: Hawaii Economic Outlook
23 Hawaii Economic Outlook Gradual recovery in visitor arrivals expected to begin in the second half of 2010 1 In thousands. 2 $ in millions. Source: Hawaii Department of Business, Economic Development & Tourism Actual 2006 2007 2008 2009 2010 2011 Visitor Arrivals 1 7,628 7,628 6,807 6,407 6,482 6,
Slide 24: Economic Comparison
24 Economic Comparison Sources: Hawaii Department of Business Economic Development & Tourism (DBEDT) Hawaii Department of Labor and Industrial Relations Military A ffairs Council of the Chamber of Commerce of Hawaii U.S. Department of Commerce National Association of Realtors Federal H ome Loan Mort
Slide 25: Hawaii Market Opportunity
25 Hawaii Market Opportunity Established and attractive market position in the Hawaii market. One of the largest financial institutions in Hawaii with over 13% deposit market share among banks and thrifts. 1 Viewed as the local community bank that is large enough to provide a broad suite of products
Slide 26: Hawaii Market Opportunity
26 Hawaii Market Opportunity 55 Year Anniversary – Honoring our Heritage. Launch of new branding campaign. Works. For You. Community-Based Banking strategies to increase market share. Exceptional Account strategies to increase share of wallet. Capitalize on position as #1 residential mortgage lender
Slide 27: Investment Considerations
27 Investment Considerations Focus on credit risk management Strengthened capital position Disciplined liquidity management Strong, low cost deposit franchise Hawaii market opportunity
Slide 28: Appendix
APPENDIX
Slide 29: Hawaii Commercial Mortgage Portfolio
29 Hawaii Commercial Mortgage Portfolio At 6/30/09 – Total $791 million ($ outstandings in millions) Property Type Condo $18 2% Other $12 2% Storage $52 7% Industrial/Warehouse $98 12% Hotel $21 3% Retail $117 15% Office $98 12% Owner User $267 33% Apartment $108 14% Average loan size is $1.2 millio
Slide 30: Hawaii Commercial Construction Portfolio
30 Hawaii Commercial Construction Portfolio At 6/30/09 – Total $325 million ($ outstandings in millions) Location Oahu $198 61% Kauai $15 5% Big Island $18 5% Maui $94 29% Average loan size is $5 million (committed). 81 loans with a current weighted average LTV of 82.6%. 3 of the larger loans (by ou
Slide 31: Hawaii Residential Mortgage Portfolio
31 Hawaii Residential Mortgage Portfolio At 6/30/09 – Total $773 million ($ outstandings in millions) Location Residential Mortgages (excluding Home Equities, Private Bkg) Metro/East Oahu $247 45% Big Is land $26 5% Kauai $28 5% Maui/Molokai $99 18% North/Windward Oahu $65 12% West Oahu $79 15% For
Slide 32: Hawaii Residential Construction Portfolio
32 Hawaii Residential Construction Portfolio At 6/30/09 – Total $363 million ($ outstandings in millions) Location Maui $117 32% Big Island $104 29% Kauai $32 9% Oahu $110 30% Property Type Condo $65 18% Townhouse $81 22% SFR $217 60% Average loan size is $6.2 million (committed). 69 loans with a cu
Slide 33: Hawaii High End Resort Segment
33 Hawaii High End Resort Segment At 6/30/09 – Total $150 million ($ outstandings in millions) Location Maui $36 24% Oahu $22 15% Kauai $21 14% Big Island $71 47% Average loan size is $11.8 million (committed). There are 15 loans in this segment; 3 of the larger loans (by outstandings) are: $27 mill
Slide 34: Hawaii C&I and Other Loan and Lease Types
34 Hawaii C&I and Other Loan and Lease Types At 6/30/09 – Total $464 million ($ outstandings in millions) Location - C&I/Consumer Loans Oahu $291 70% Kauai $17 4% Big Island $44 11% Maui $61 15% Average loan size for commercial/industrial portfolio is $153 thousand (committed). 3 of the larger loans
Slide 35: Mainland Commercial Construction Portfolio
36 Mainland Commercial Construction Portfolio At 6/30/09 – Total $383 million ($ outstandings in millions) Property Type Other $39 10% Apartment $50 13% Retail/Restaurant $118 31% Office $126 33% Industrial/Warehouse $50 13% Location Oregon $4 1% Washington $66 18% Nevada $8 2% Sacramento $62 16% Ri
Slide 36: Mainland – Retail/Restaurant Property Segment
37 Mainland – Retail/Restaurant Property Segment At 6/30/09 – Total $353 million ($ outstandings in millions) Location Los Angeles $152 43% Other States $22 6% Nevada $33 9% Arizona $22 6% Calif - Other $14 4% Fresno $17 5% Sacramento $17 5% Tulare $21 6% Riverside $55 16% Average loan size is $5.9
Slide 37: Mainland – Office Property Segment
38 Mainland – Office Property Segment At 6/30/09 – Total $268 million ($ outstandings in millions) Location Los Angeles $35 13% San Diego $36 13% Sacramento $74 28% Other States $18 7% Washington $47 18% Arizona $20 7% Other Calif $38 14% Average loan size is $6.9 million (committed). Portfolio cons
Slide 38: Mainland Residential Construction Portfolio
39 Mainland Residential Construction Portfolio At 6/30/09 – Total $47 million ($ outstandings in millions) Location Sacramento $9 19% Washington $11 24% Other Calif $1 2% Riverside $9 20% Fresno $17 35% Portfolio consists of 12 loans with a weighted average LTV of 92% and weighted average net book v