First Community Bankshares, Inc. · NASDAQ:FCBC
First Community Bankshares — First Community Bancshares — Investor Presentation (June 2013)
30 slides from First Community Bankshares's investor presentation, Jun 5, 2013
Slide 1: First Community Bancshares, Inc. June 2013
ISS First : June 2013 Community Bancshares, Inc. www.febine.com
Slide 2: First Community Bancshares
First Community Bancshares 2
Slide 3: Company Overview
Company Overview 3 a Source : SNL Financial b Source: SNL Financial and Company data Bluefield, Virginia West Virginia Virginia North Carolina South Carolina Tennessee Assets: $2.7 billion Loans: $1.7 billion Deposits: $2.0 billion Tangible common equity: $233 million Strategic consideration Two tra
Slide 4: 1Q13 Summary
1Q13 Summary • Assets: $2.7 billion, up 23% year over year • Net interest margin: 4.15% vs. 3.91% year over year • E fficiency: 60% • $0.33 Core EPS up 3 % year over year ($0.32). Note that 1Q13 included $0.05 of after tax Indemnification A sset (IA) amortization. • Core ROA: 1.05% • Core ROE: 8.23%
Slide 5: Summary of 1Q13 Earnings
Summary of 1Q13 Earnings Three Months Ended March 31, 2013 2012 Change Net Interest Income 23,362$ 17,977$ 30.0% Provision for Loan Losses 1,142 922 23.9% Net Interest Income (after provision) 22,220 17,055 30.3% Securities gains 117 51 129.4% Other Income 7,744 7,940 -2.5% Total Noninterest Income
Slide 6: Challenges and Opportunities Ahead
Challenges and Opportunities Ahead • Environmental/Macro: (Interest Rates, Regulatory, Political): Chiefly, a prolonged flat interest rate environment projected to continue to pressure NIM output as well as loss of purchase accounting income • Low growth, highly competitive environment continue to r
Slide 7: Investment Highlights
Investment Highlights • 138 years of success ….. since 1874 • Diverse geographic footprint includes stable legacy markets and attractive growth markets • Attractive deposit share : Top 2 market share in six counties. • Strong NIM driven by s table , low - cost deposit base • Strong asset quality thr
Slide 8: Investment Highlights: Diverse Geographic Franchise
▪ 72 branches in WV, VA, NC, SC, and TN ▪ Mix of urban growth markets and stable legacy markets ▪ Growth targets in NC, Richmond, VA and East TN ▪ Deposit breakout : - West Virginia $930 million - North Carolina $490 million - Virginia $531 million - Tennessee $ 61 million - South Carolina $ 35 mill
Slide 9: Investment Highlights: Attractive Deposit Share Positioning
Investment Highlights: Attractive Deposit Share Positioning 9 Source: 2012 FDIC Summary of Deposits County Share Position Taylor, WV 48.2% 2 Mercer, WV 36.6% 1 Columbus, NC 22.9% 2 Wyoming, WV 34.0% 2 Upshur, WV 31.7% 2 Webster, WV 24.8% 2 Top 2 market share in six counties.
Slide 10: Investment Highlights: Strong NIM
0.50% 0.75% 1.00% 1.25% 1.50% 1.75% 2.00% 2.25% 2009 2010 2011 2012 Q1 13 1.97% 1.50% 1.17% 0.91% 0.80% 2.01% 1.50% 1.13% 0.81% 0.65% FCBC Peer Investment Highlights: Strong NIM Peers include publicly traded banks with assets between $1 and $4 billion in NC, SC, VA, and WV (AMNB, BNCN, BTC, CFNL, CH
Slide 11: Investment Highlights: Interest Rate Risk Analysis
Investment Highlights: Interest Rate Risk Analysis 11 * The above table summarizes the impact of immediate and sustained rate shocks in the interest rate environment on net interest income . The model simulates plus 300 to minus 100 basis point changes from the base case rate simulation and illustra
Slide 12: Investment Points: Quality Ratios
0.00% 0.20% 0.40% 0.60% 0.80% 1.00% 1.20% 1.40% 1.60% 1.80% 2009 2010 2011 2012 Q1 13 0.70% 0.90% 0.67% 0.41% 0.56% 0.77% 1.66% 1.31% 0.91% 0.46% FCBC Peer 0.50% 1.00% 1.50% 2.00% 2.50% 3.00% 3.50% 4.00% 4.50% 5.00% 2009 2010 2011 2012 Q1 13 1.50% 2.27% 2.42% 2.38% 2.12% 3.22% 4.80% 4.62% 3.27% 3.01
Slide 13: Investment Highlights: Strong Asset Quality
Reserves / Non - Performing Loans Reserves / Total Loans Peers include publicly traded banks with assets between $1 and $4 billion in NC, SC, VA, and WV (AMNB, BNCN, BTC, CFNL, CHCO, EVBS , FBNC, FFCH, FNBN, FRNK, HMPR, HTBI, MBRG, NBBC, NKSH, PEBK, PFBI, PLMT, PSTB , SMMF, STEL, UBSH, VCBI, YAVY).
Slide 14: Investment Highlights: Nonperforming Asset Detail
Investment Highlights: Nonperforming Asset Detail 14 March 31, December 31, September 30, June 30, 2013 2012 2012 2012 Non-Covered Nonaccrual loans 30,076$ 23,931$ 26,514$ 27,947$ Accruing loans past due 90 days or more - - - - Unseasoned troubled debt restructurings 1,596 6,009 121 469 Nonperformin
Slide 15: Investment Highlights: Superior Efficiency Ratio
50% 55% 60% 65% 70% 2009 2010 2011 2012 Q1 13 59.40% 59.10% 59.56% 55.96% 59.55% 63.49% 64.88% 66.65% 66.59% 67.59% FCBC Peer Peers include publicly traded banks with assets between $1 and $4 billion in NC, SC, VA, and WV (AMNB, BNCN, BTC, CFNL, CHCO, EVBS , FBNC, FFCH, FNBN, FRNK, HMPR, HTBI, MBRG,
Slide 16: Investment Highlights: Capital Strength
Investment Highlights: Capital Strength • Solid Capital Ratios… • BHC TCE/TA: 8.93% • BHC Tier 1 Leverage: 10.35%, Tier 1 RBC: 16.4%, TRBC: 17.65% • Bank Tier 1 Leverage: 9.31%, Tier 1 RBC: 14.81%, TRBC: 16.06% • And Widening… • Bank Tier 1 Leverage has widened ~31 bps ( avg ) over last two quarters
Slide 17: Positioned and Strategically Focused on Consolidation
Investment Highlights: Positioned and Strategically Focused on Consolidation Substantial growth opportunity – Targeted strategic bank acquisitions • Fill in primary markets • Attractive price levels through the cycle • M&A pipeline in targeted growth markets remains attractive – FDIC - assisted tran
Slide 18: Peoples Bank of Virginia Transaction Rationale
Peoples Bank of Virginia Transaction Rationale □ In - market acquisition consistent with FCBC’s Merger & Acquisition strategy □ Created 10 th largest Virginia - based bank by deposits in the Richmond market □ Strong cultural fit 18 Strategic Rationale Financially Attractive Low Risk Profile □ Exceed
Slide 19: Peoples Bank of Virginia Financial Impact of the Transaction
Peoples Bank of Virginia Financial Impact of the Transaction 19 Transaction Assumptions/ Update Financial Impact □ EPS accretive in the first full year of combined operations □ Modest tangible book value dilution of 3.6% □ Ability to leverage insurance business line and other product offerings incre
Slide 20: Peoples Bank of Virginia Summary
Peoples Bank of Virginia Summary 20 □ Transaction drives EPS growth and shareholder value for both FCBC and Peoples shareholders □ Manageable transaction size and strong pro forma capital ratios allow for future opportunities □ O rganic growth opportunities in the Richmond market remain attractive □
Slide 21: Waccamaw Bank Summary
Waccamaw Bank Summary 21 □ Acquired 16 branches in FDIC - assisted deal • Added 12 branches to existing North Carolina franchise and expands presence into South Carolina with 4 branches □ Purchased approximately $500 million in total assets, including $318 million in loans at close (before mark) □ M
Slide 22: Waccamaw Bank Strategically and Financially Compelling
22 □ Consistent with our acquisition strategy □ Extends footprint to a target growth market □ Significantly accretive to core earnings per share □ Deployed excess capital – No raise necessary □ Reasonable tangible book value dilution (4.8%) – Earnback dilution in approximately 2 years □ Strong IRR i
Slide 23: Loss Share Background and Accounting Update
Background ▪ Acquired Waccamaw Bank with FDIC Loss - Share Coverage which closed May 31, 2012. At deal close loans totaled approximately $318 million (pre - mark) of which most were covered by loss share (80%). ▪ Recorded No Pre - tax Bargain Purchase Gain and did not pay a deposit premium. ▪ Establ
Slide 24: Loss Share Review: Purchase Accounting Accretion Projections
Loss Share Review: Purchase Accounting Accretion Projections 24 $0 $2,000 $4,000 $6,000 $8,000 $10,000 $12,000 1Q13 Remainder 2013 Purchase Accounting Accretion Projections Purchase Accounting Accretion Projections PBV PBV Waccamaw Waccmaw Loan Certificates Loan Certificates Accretion of Deposit Acc
Slide 25: Loss Share Review: Projected Indemnification Asset Amortization
Loss Share Review: Projected Indemnification Asset Amortization 25 $0 $200 $400 $600 $800 $1,000 $1,200 $1,400 $1,600 $1,800 1Q13A 2Q13E 3Q13E 4Q13E I/A Projected Amortization (Consolidated) I/A Projected Amortization (Consolidated)
Slide 26: Balance Sheet Summary
Balance Sheet Summary ▪ Levering capital through the latest acquisitions 26 March 31, December 31, September 30, June 30, March 31, 2013 2012 2012 2012 2012 Cash & Securities 705,364$ 680,021$ 683,206$ 684,067$ 590,838$ Total Loans 1,692,086 1,731,685 1,768,056 1,807,326 1,390,047 Allowance for Loan
Slide 27: Attractively Valued Versus Peers
Attractively Valued Versus Peers 27 ▪ Using a comparable peer group of high - performing regional banks, FCBC is an attractively priced name ▪ Peer group consists of $1 - $10 billion banks in W.Va. and Virginia with TCE >= 7% and NPA’s < 3% ▪ FCBC shows comparable returns and better than peer asset
Slide 28: Why buy FCBC?
▪ Strong pre - tax, pre - provision core income ▪ Favorable NIM ▪ Solid Credit ▪ Capital Strength ▪ Non - margin , fee - based revenue diversification ▪ Strong dividend yield of nearly 3% ▪ Positioned and capable to emerge as one of the strongest players in the region and build one of the best franc
Slide 29: Forward-Looking Disclosures
Forward - Looking Disclosures This presentation may include forward - looking statements. These forward - looking statements are based on current expectations that involve risks, uncertainties and assumptions. Should one or more of these risks or uncertainties materialize or should underlying assump
Slide 30: Contact Information
Contact Information First Community Bancshares, Inc. NASDAQ: FCBC One Community Place Bluefield, VA 24605 For More Information Contact: David D. Brown Chief Financial Officer First Community Bancshares, Inc. (276) 326 - 9000 30
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