First Community Bankshares, Inc. · NASDAQ:FCBC
First Community Bankshares — First Community Bancshares — Investor Presentation (May 2010)
33 slides from First Community Bankshares's investor presentation, May 3, 2010
Slide 1: First Community Bancshares, Inc. May 2010
ae First , Communi Bancshares, Inc. NASDAQ: FCBC May 2010
Slide 2: Forward-Looking Disclosures
SE rirst co Community Forward-Looking Disclosures Bancshares, Inc. ‘This may include forward-looki ‘These forward- looking statements are based on current expectations that involve risks, uncertainties and assumptions. Should one or more of these risks or uncertainties mate sumptions prove incorrect
Slide 3: First Community Bancshares Overview
First Community Bancshares Overview
Slide 4: Investment Highlights
Investment Highlights XB First Community Bancshares, Inc. A $2.3 billion VA, WV, NC and TN branch franchise — 135 years of conti ous operation — Strong history of core earnings and dividend payments — Robust market share in legacy markets and attractive expansion into growth markets — Positioned as
Slide 5: Investment Highlights
SE rirst ca. Community Investment Highlights Bancshares, Inc. True retail franchise generating low cost core deposits — Over 119,000 customer accounts with Q1 2010 average cost of funds of 1.55%, below peer average of 1.69% * Exceptional balance sheet profile Strong loan quality — NPLs/Loans of 1.26
Slide 6: Investment Highlights
SFist Comintity Investment Highlights Bancshares, Inc. * Strong in, fee-b: d revenue Fresh start on 2010 — Core earnings back to prominent position — No exposure to pooled TPS impairments — Continued capital strength ~ Ready to grow
Slide 7: Experienced Executive Management Team
XB First . . Community Experienced, Executive Management Team Bancshares, Inc. s ‘of management and ; —. Fstablished and experienced management team with average tenure > 19 years total insider ownership of 7% Years in Banking Years with FCB John M. Mendez 5 8 President andl CEO Robert L. Buzz0 37 3
Slide 8: Current Franchise Overview: Branch Map
tunity res, Inc. Current Franchise Overview: Branch Map * 71 locations across five-states (Vit West Virginia, North Carolina, ‘Tennessee and South Carolina ) Markets Attractive urban and suburban markets in the Carolinas, Virginia, West Virginia, and Tennessee Pull array of services creates financia
Slide 9: Current Franchise Overview: Market Demographics and Position
Current Franchise Overview: Market Demographics and Position
Slide 10: Strategic Direction
Strategic Direction XB First Community Bancshares, Inc. ‘Transformational growth to $5 billion — Targeted strategic bank acquisitions + Fill in primary markets + Attractive price levels ~ FDIC-assisted transactions + Possible larger transactions + Primary and secondary markets Continue diversificati
Slide 11: Strategic Direction
SFist en Community Strategic Direction Bancshares, Inc. Balanced Growth and Profitability Strategy Alternative Solution vs. Large Banks Position as Regional Consolidator Pursue Growth Pras around Key MSA‘s Develop Legacy Markets/Earnings Driver nsLversity Revenues into sociated Financial Service tin
Slide 12: Credit Quality
SE rirst . . Community Credit Quality Bancshares, Inc. Protect the culture/defend underwriting Defensive posture on real estate Cutting all exposures to A&D through remainder of the cycle Outstandings have fallen Carty excess liquidity Early detection of emerging problem loans Recent CRE stress test
Slide 13: Earnings Leadership
Earnings Leadership Efficiency — Conservative business approach — Low cost structure in region — Lower cost workforce Core Deposits — Built over years of operation — Value of the franchise — Strong market share Cost of Funds ~ Strong DDA base — Disciplined approach to pricing Diversified Non-Credit
Slide 14: Key Franchise Differentiator: Core Low Cost Deposits
Key Franchise Differentiator: Cort ity Retail Franchise with Core, Low Cost Deposits Bancshares, Inc. Deposit Composition as of March 31, 2010 Account Balances as of March 31, 2010 TASombo ma Demand \ccounts Balance Sieh ane A Bal Demand 34810 Inerest Bearing Demand 35,665 Savings 25,069 “Toul DDA T
Slide 15: Key Franchise Differentiator: Rapid Growth in Non-Interest Income
Key Franchise Differentiator: Cort ity Rapid Growth in Non-Interest Income Bancshares, Inc. Since 2004, the Company has grown non-interest income sources to reduce interest rate cycle exposure — Increased wealth management line of business = Grown insurance line of business — Re-engineered retail pr
Slide 16: M&A
XE First Community Bancsha M&A res, Inc. Opportunity: Filters: FCB is a strong partner FCB provides exit strategy for institutions under pressure Look to augment existing franchise Opportunistic = Assisted transactions = Strong currency Predominately stock Growing opportunity throughout credit cycle
Slide 17: Recent Acquisitions: Bank & Thrift Transactions
Recent Acquisitions: Bank & Thrift Transactions XB First Community Bancshares, Inc. Coadie Cseek Financial Com Acquis ‘TriStone Community Bank Acquisition + f Winston Salem market ‘+ Expanded ous fra Iredell and Mecklenburg County Markets ‘+ Market Population growth in both counties projected » be i
Slide 18: Recent Acquisitions: Insurance Agency
Recent Acquisitions: Cort ity Insurance Agency Tr Bancshares, Inc. * Acquired GreenPoint Insurance (High Point, NC) in September 2007 = Fall service insurance agency headquartered in High Point, NC Provider of commercial and personal insurance lines, employee benefits and life and health = Acquired
Slide 19: FDIC Opportunities
SE rirst Community FDIC Opportunities Bancshares, Inc. * The primary focus of M&A activity today * Objectives — One or more transactions within our primary or secondary markets — Lead transformational growth — Expect material accretion to TBV and EPS = Planning and Process — Developed integration pl
Slide 20: FDIC Opportunities: Why will we be successful?
XE First Comimtinity FDIC Opportunities incshares, Inc. Why will we be successful? — Best partner ~— Well-suited geographically — Sparse and thinning competition — History as an integrator — Converted 25 deals in 26 years — Two healthy bank deals in the last 20 months — High number of emerging oppor
Slide 21: FDIC Opportunities
FDIC Opportunities * Banks under $1.15 billion with ‘Texas Ratios greater than 100 or under regulatory directive = Represents $9.11 billion in opportunities
Slide 22: Loan Portfolio: Diversified Portfolio with Strong Loan Quality
Loan Portfolio: Diversified Portfolio with Strong Loan Quality Cait Bancshares, Inc. Strong loan quality — NPLs / Net Loans at March 31, 2010 of 1.25% ‘Total delinquency of 2.35% Geographically diversified portfolio across the region Highly Granular: — Majority of loans in $30,000 to $300,000 range
Slide 23: Loan Portfolio: Strong Loan Quality
Loan Portfoli Strong Loan Quality Non-Performing Loans / Total Loans XB First Community Bancshares, Inc. : 3 4.00% = z 2 3.00% 2.00% = EI e238 oom, —, ma, ; 20032006 2009 quio Reserves / Nonperforming Loans Net Charge-Offs / Average Loans = a: sme § ge § zg ‘ore gi a § 300% » S 200% a, a 100% a w% .
Slide 24: Loan Portfolio: Residential Real Estate Portfolio
Loan Portfolio: Residential Real Estate Portfolio XE First Comimtinity ncshares, Inc. ‘The residential real estate portfolio is made up of 10,861 loans with an average balance of $59,675 First quarter 2010 consumer credit scoring shows weighted average FICO of 709 ‘Total FCBC mortgage delinquency of
Slide 25: Loan Portfolio: A&D and Construction
Loan Portfolio: corny A&D and Construction Bancshares, Inc. . any olds 689 ABD ion Loans wit 150 © The A&D and C ly diversified with the th being: NC 50%, WV 32% and VA and Construction Loans have decreased from $125.7 million at December 31, 2009, to $113.7 millon at March i, 2009 A&D and Construct
Slide 26: First Quarter 2010 Update
XE First Comimtinity First Quarter 2010 Update incshares, Inc. First quarter GAAP net income gain of $5.3 million and diluted EPS of $.30 per share. Core earnings remain strong at $5.7 million, or $0.32 per share Asset quality metrics continue to compate favorably to peers with a ratio of non-perfor
Slide 27: Current Franchise Overview: Annual Financial Results
Current Franchise Overview: res, Inc. 2005 2006 __—-2007_——2008 2009 Qt 2010 Net income availibl to common shareholders (as-reported) $ 26,303 $ 28,948 $ 29,632 '$ (40,388) Dited $ 232 8 257 $§ $ 03 $ 272) Core net income * $ 2077 $ 28614 § 20,777 $ 21,865 $ 16,712 Core diluted EPS * $230 S$ 254 $ 2
Slide 28: Current Franchise Overview: Financial Results by Quarter
Current Franchise Overview: Financial Results by Quarter Cait Bancshares, Inc. Net income available to common sharchokless (as-reported) Diluted EPS Core net income * Come diluted EI Dividend ROAA ROAE Margin Efficieney (non-GAAP) * 2009 Q1 2009 Q2 2009 Q3_2009 Q4_2010 QI Ss 4659 S040 Ss 5290 s s 04
Slide 29: Financial Performance Highlights
Financial Performance Highlights: cantint munity Efficiency, Cost of Funds, Net Interest Margin Communit Inc. Efficiency FCBC_m Peers = 2008 2009 QI2010
Slide 30: Why buy FCBC?
Cort ity Why buy FCBC? Bancshares, Inc. = A $2.3 billion VA, WV, NC and TN branch franchise — Robust market share in legacy markets and attractive expansion into growth markets = Positi as regional — Looking to grow via strategic and opportunistic FDIC-assisted deals = True retail franchise generati
Slide 31: Why buy FCBC?
Cort ity Why buy FCBC? Bancshares, Inc. = Strong pre-tax, pre-provision core income " Resilient net interest margin of 4.02% for Q1 2010 and 3.74% for 2009 = Strong gin, fee-based revenue Strong dividend yield at over 3% Positioned to emerge as one of the strongest players in the region and build on
Slide 32: Your First Financial Resource
Bancshares, Inc. YOUR FIRST FINANCIAL RESOURCE
Slide 33: Non-GAAP Reconciliation of Core Earnings
Non-GAAP Reconciliation of Core Appendix A Earnings echo pment aus 2006 2007 sos 2009 ot 80 s S MOH S$ me Sam | CHEN Som ae) nes aw) sas, .
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