Southstate Bank Corporation · NYSE:SSB
Southstate Bank — SCBT Financial — Investor Presentation (March 2012)
67 slides from Southstate Bank's investor presentation, Mar 13, 2012
Slide 1: SCBT Financial Corporation
SCBT FINANCIAL CORPORATION
Slide 2: Forward-Looking Statements
Forward-Looking Statements Statements contained in this presentation, which are not historical facts, are forward-looking statements. In addition, SCBT Financial Corporation (SCBT) through its senior management or directors may from time to time make forward-looking public statements concerning matt
Slide 3: Largest publicly traded bank headquartered in South Carolina
Largest publicly traded bank headquartered in South Carolina Serving the banking needs of customers within the Carolinas for 79 years and Georgia for 112 years Strong asset quality and credit underwriting remain the fundamentals of SCBT SCBT Financial Corporation 3
Slide 4: SCBT Footprint
SCBT Footprint North Carolina 3 branches $ 241 Million Deposits #8 Rank in Charlotte MSA South Carolina 45 branches $ 2.26 Billion Deposits #7 Rank Northeast Georgia 22 branches $ 916 Million Deposits #5 Rank Headquarters- Columbia, SC * Market share ranking as of June 30,2011, all other for the cur
Slide 5: Market Performance
Market Performance Data as of 2/23/2012. Source: SNL Financial and Company filings. KRX is a composition of 50 regionally diversified mid & small-cap banking institutions in the U.S. The index is calculated using an equal-weighted method and components comply with the GICS and ICS classification sta
Slide 6: Profitability
Profitability Per share data reflect a ten percent stock dividend distributed on December 6, 2002, a five percent stock dividend distributed on January 1, 2005 and a five percent stock dividend distributed on March 23, 2007. For 2008, the loss related to the disposal of Freddie Mac Preferred Stock i
Slide 7: Strategic Areas of Focus
Strategic Areas of Focus Soundness LEADERSHIP Dy gf eancat .) CORPORATION’ [if
Slide 8: Impact to SCBT
Impact to SCBT Focus Differentiates SCBT Low Turnover Attracts Customers and Employees Clear Roadmap 8
Slide 9: Highlights of SCBT
Highlights of SCBT Profitable Every Quarter of Downturn Fortress Balance Sheet Improved Credit Trends 79 Years of Service in South Carolina 112 Years of Service in Georgia Strong Culture Consistent Growth Organic Growth Selective M&A strategy Well-positioned for Future 9
Slide 10: 4th Quarter 2011 Highlights
4th Quarter 2011 Highlights Solid Net Income, $4.8 million BankMeridian integration complete Finished Georgia branch reductions Organic Loan growth for 7 consecutive quarters Core Deposit continue to grow; $46.5 million 4Q Fee Income remains solid Announced open-bank merger of Peoples Bancorporation
Slide 11: Goals and Priorities
Goals and Priorities Execute and integrate Peoples Two deals a year Focus on selective organic growth Return to normalized EPS 11
Slide 12: Leadership
Leadership Experienced Executive Management Team Executive Position Years in Banking Years with SCBT Robert R. Hill, Jr. CEO 23 16 John C. Pollok Sr. EVP, COO 25 16 Joe E. Burns Sr. EVP, CRO 35 11 John F. Windley President, CBO 36 10 Donald E. Pickett EVP, CFO 16 2 Renee R. Brooks EVP, CAO 20 16 12
Slide 13: South Carolina Deposit Market Share
South Carolina Deposit Market Share Source: FDIC Summary of Deposits as of 6/30/2011 * SCBT includes BankMeridian Deposits. Rank Institution ($000) Deposits Share Market Branches 1 Wells Fargo & Co (CA) 12,009,580 17.69% 151 2 Bank of America (NC) 9,043,470 13.32% 111 3 BB&T (NC) 6,662,063 9.82% 115
Slide 14: Charlotte Deposit Market Share
Charlotte Deposit Market Share . Source: FDIC Summary of Deposits as of 6/30/2011. Rank Institution ($000) Deposits Share Market Branches 1 Bank of America (NC) $127,934,050 79.59% 60 2 Wells Fargo & Co (CA) 18,297,321 11.38% 81 3 BB&T (NC) 4,038,087 2.51% 59 4 Fifth Third Bank (OH) 1,478,806 .92% 3
Slide 15: Northeast Georgia Deposit Market Share
Northeast Georgia Deposit Market Share Note: NE Georgia Deposit Market Share includes the following counties: Barrow, Habersham, Hall, Jackson, Oconee, Rabun, Stephens, Towns, Warren, White. *As of January 2012, 19 branches Source: FDIC Summary of Deposits as of 6/30/2011. Rank Institution ($000) De
Slide 16: Capital
Capital Redeemed preferred stock & common stock warrants First bank in South Carolina & one of the first nationally Capital Raise: $91 million $27M October 2008 $29M May 2009 $35M February 2011 Capital Ratios Leverage Ratio 9.12% Tier 1 Capital Ratio 14.09 % Total Risk Based Capital Ratio 15.36 % Ta
Slide 17: Habersham Bank Peoples Bancorporation
Habersham Bank Peoples Bancorporation
Slide 18: Transaction Rationale
Transaction Rationale In market acquisition consistent with SCBT’s Merger & Acquisition strategy Creates the 6th largest Bank pro forma deposit market share in South Carolina Well positioned along the I-85 corridor; connecting existing franchise in Charlotte, Greenville and Georgia markets Cultural
Slide 19: Terms of the Transaction
Terms of the Transaction Transaction Value: (1) $28.4 million Fixed Exchange Ratio: (1) 0.1413 SCBT shares for each share of PBCE Implied Price per Share: (1) $4.00 Consideration: 100% stock Price/Tangible Book Multiple: (1) (2) 62% PBCE TARP Treatment: SCBT intends to redeem on day of closing Capit
Slide 20: Connecting our Footprint Along I-85 Corridor
Connecting our Footprint Along I-85 Corridor Source: SNL Financial SOUTH CAROLINA GEORGIA NORTH CAROLINA SCBT Branch PBCE Branch Charlotte Greenville Atlanta Columbia 20
Slide 21: Soundness
SUUNDNESS
Slide 22: Credit Quality
Credit Quality Source: SNL Financial and Company filings. Data as of 9/30/11. KRX is a composition of 50 regionally diversified mid- & small-cap banking institutions in the U.S. The index is calculated using an equal-weighted method and components comply with the GICS and ICS classification standard
Slide 23: Credit Quality Ratios
Credit Quality Ratios 4Q’10 1Q’11 2Q’11 3Q’11 4Q’11 Non-Performing Assets / Total Assets* 2.41% 2.29% 2.44% 2.44% 2.44% Non-Performing Assets / Total Loans & OREO* 3.74% 3.83% 3.86% 3.87% 3.82% Allow. Loan Losses / Total Loans* 2.07% 2.05% 2.00% 2.00% 2.00% Allow. Loan Losses / Non-Performing Loans*
Slide 24: Capital
Capital Source: SNL Financial and Company filings. Data as of 9/30/11. KRX is a composition of 50 regionally diversified mid- & small-cap banking institutions in the U.S. The index is calculated using an equal-weighted method and components comply with the GICS and ICS classification standards. Caro
Slide 25: Profitability
PROFITABILITY
Slide 26: Consistent Long-Term Earnings Power
Consistent Long-Term Earnings Power * Represents after-tax gain from CBT acquisition In Millions 115.9 26
Slide 27: Net Interest Margin (TE)
Net Interest Margin (TE) Source: BHC Performance Report. Peers are BHC with assets between $3 billion & $10 billion 27
Slide 28: Operating Efficiency
28 Operating Efficiency 45 50 50 48 75 70 63.8% 66.1% 63.2% 61.2% 46.7% 68.8% 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% 80.0% 30 40 50 60 70 80 90 2006 2007 2008 2009 2010 2011 • 2011 Efficiency Ratio – Habersham consolidation With Branch consolidation, Phase 3 – 67 Branches 28
Slide 29: Dividends
Dividends Dividend paid for 144 consecutive quarters since 1976 Prior to 1976, dividends were paid semi-annually 4th Quarter 2011 includes dividends declared on 1/26/12, record date of 2/17/12, payable on 2/24/12 29
Slide 30: [LOGO]
[LOGO]
Slide 31: Growth Strategy
Growth Strategy Build strong bank in South Carolina, North Carolina, and Georgia Organic Growth FDIC Deals Whole Bank Acquisitions Growth Goals: Drive EPS Top 5 in market share Build a franchise 31
Slide 32: Loan Portfolio – December 2011
Loan Portfolio – December 2011 Type $ Mix % Mix Construction / Land Development $ 310.9 12.58% Commercial Non Owner Occupied $ 299.7 12.13% Consumer Owner Occupied $ 656.5 26.57% Commercial Owner Occupied $ 742.9 30.07% Commercial & Industrial $ 220.5 8.92% Other Income Producing Property $ 140.7 5.
Slide 33: Organic Loan Growth
Organic Loan Growth In Millions * Bars represent Non-Acquired Loan Growth, linked quarter 33
Slide 34: Non-Performing Loans
Non-Performing Loans Source: SNL Financial and Company filings. Data as of 09/30/11 KRX is a composition of 50 regionally diversified mid- & small-cap banking institutions in the U.S. The index is calculated using an equal-weighted method and components comply with the GICS and ICS classification st
Slide 35: Deposit Mix – December 31, 2011
Deposit Mix – December 31, 2011 35 Demand Deposits 20% Savings 8% Interest Bearing Deposits 45% CD < 100,000 15% CD > 100,000 12%
Slide 36: Growth – Core & Total Deposits
Growth – Core & Total Deposits In Millions *Core Deposits exclude all certificates of deposits *As of December 31, 2011 Core deposits grew $477 million since Dec-10; Legacy SCBT $244 million / Acquired $233 million 2011 YTD # Transaction account growth for Legacy SCBT 14.3% annualized Total YTD $ Ba
Slide 37: Business Mix by Market – December 31, 2011
Business Mix by Market – December 31, 2011 Loans Deposits Inland SC 51% Coastal SC 24% Charlotte MSA 23% Georgia 2% Inland SC 44% Coastal SC 14% Charlotte MSA 16% Georgia 26% *Inland SC includes Florence 37
Slide 38: Supplemental Information
Habersham Bank SUPPLEMENTAL INFORMATION
Slide 39: Index – Supplemental Information
39 Index – Supplemental Information • Loan portfolio summary – Type40 • Vintage/New Loan Mix41 • Construction / Land Development Loans42 • ALLL Trend44 • Credit Trends45 • Charge-offs by type47 • NPA’s & Classifieds by Region/Type48 • Loss Share Performance51 • Total Assets by Risk Weight %53 • Inve
Slide 40: Loan Portfolio Summary - Type
40 Loan Portfolio Summary - Type (dollars in thousands) Dec-10 Mar-11 Jun-11 Sep-11 Dec-11 Construction / land development 391,987 $ 370,442 $ 338,288 $ 316,072 $ 310,845 $ Commercial non-owner occupied 320,203 332,773 306,698 304,616 299,698 Consumer owner occupied 325,470 339,948 367,910 394,205 3
Slide 41: Vintage / New Loan Mix – 4Q 2011
41 Vintage / New Loan Mix – 4Q 2011 - 50,000 100,000 150,000 200,000 250,000 300,000 350,000 400,000 450,000 500,000 550,000 600,000 650,000 700,000 750,000 Con/Land Dev Cml Non- Owner Occ Other Inc Prod Prop Cons Owner Occ Cml Owner Occ C & I Cons Non Real Estate 42% 50% 41% 36% 34% 19% 9% 58% 50%
Slide 42: Construction / Land Development Loan Mix – 4Q 2011
42 Construction / Land Development Loan Mix – 4Q 2011 - 20,000 40,000 60,000 80,000 100,000 120,000 140,000 160,000 Cons Constr Land/Lots Constr Loans to Builders Comm Constr Res Lot Loans 2% 57% 56% 51% 98% 43% 44% 100% 49% Vintage New In Thousands *New=Origination date of 1/1/08 or later, non-acqu
Slide 43: Construction / Land Development Loans (Non-Acquired)
Construction / Land Development Loans (Non-Acquired) 4Q 2007 4Q 2011 Loan Type 4Q07 % 4Q11 % Consumer Construction $ 50,269 9% $ 54,195 17% Land/Lots $ 153,682 28% $ 140,538 45% Construction Loans to Builders $ 73,768 13% $ 13,727 4% Commercial Construction $ 106,821 19% $ 18,239 6% Residential Lot
Slide 44: ALLL Trend Data (Non-Acquired Loans)
ALLL Trend Data (Non-Acquired)Loans) $- $10,000 $20,000 $30,000 $40,000 $50,000 $60,000 6/30/09 9/30/09 12/31/09 3/31/10 6/30/10 9/30/10 12/31/10 3/31/11 6/30/11 9/30/11 12/31/11 Q Factors HLR FAS 114 Provision Expense Net Charge Offs 1.40 % 1.45 % 1.55 % 1.70 % 1.90 % 2.07 2.07 % 2.05 % 2.00 % 2.00
Slide 45: Credit Trends
31-Dec-10 31-Mar-11 30-Jun-11 30-Sep-11 31-Dec-11 86.5 $ 90.8 $ 93.7 $ 96.1 $ 94.9 $ 2.41% 2.29% 2.44% 2.44% 2.44% 28.36% 26.79% 27.25% 27.13% 26.88% 160.6 $ 171.9 $ 172.4 $ 194.3 $ 170.3 $ 189.1 187.1 188.8 180.3 184.4 53.79% 48.64% 48.58% 45.27% 45.82% Classified Assets (3) Total nonperforming ass
Slide 46: Strong Coverage Ratios Driven by Low NPAs
Strong Coverage Ratios Driven by Low NPAs 30-89 Delinquencies/Loans NPAs/(Loans + OREO) NCOs/Avg. Loans Reserves/Loans (ex HFS) Source: SNL Financial, FDIC and FFEIC, KBW Peer Data as of 9/30/11 Asset quality ratios exclude loans covered by the FDIC and loans held for sale 0.00% 0.20% 0.40% 0.60% 0.
Slide 47: Gross Charge Offs by Type
Gross Charge Offs by Type Dec-10 Mar-11 Jun-11 Sep-11 Dec-11 Dec-11 Construction/Land Development 4,643 $ 4,537 $ 2,240 $ 2,440 $ 3,201 $ 46.8% Commercial Non-Owner Occupied 512 1,236 520 1,052 142 2.1% Commercial Owner Occupied 504 729 303 1,126 286 4.2% Consumer Owner Occupied 1,229 1,825 882 1,79
Slide 48: NPAs by Region
NPAs by Region REGION Dec-10 Mar-11 Jun-11 Sep-11 Dec-11 (in thousands) Hilton Head/Beaufort 26,401 $ 25,949 $ 26,806 $ 24,104 $ 20,379 $ Charleston 3,487 8,054 7,477 6,120 12,759 Myrtle Beach 18,262 21,439 20,935 21,893 16,141 Low Country 8,983 8,104 10,919 8,898 9,834 Midlands 5,022 4,809 4,501 3,
Slide 49: NPAs by Type
NPAs by Type Dec-10 Mar-11 Jun-11 Sep-11 Dec-11 Dec-11 Construction/Land Development 28,390 $ 29,435 $ 28,525 $ 25,470 $ 28,566 $ 30.1% Commercial Non-Owner Occupied 10,073 12,192 12,630 11,272 12,392 13.1% Commercial Owner Occupied 13,056 12,326 11,184 14,653 18,392 19.4% Consumer Owner Occupied 7,
Slide 50: Classified Loans & OREO by Region
Classified Loans & OREO by Region REGION Dec-10 Mar-11 Jun-11 Sep-11 Dec-11 (in thousands) Hilton Head/Beaufort 47,953 $ 46,279 $ 44,377 $ 40,692 $ 37,411 $ Charleston 28,694 22,406 16,234 17,420 20,912 Myrtle Beach 29,742 33,770 35,638 32,207 28,218 Low Country 16,091 17,452 19,791 18,175 18,133 Mi
Slide 51: 4Q 2011 Loan Valuation (Acquired)
4Q 2011 Loan Valuation (Acquired) Unpaid Principal Balance 642,917 3.85% 648,067 4.15% 629,374 3.99% Purchase Impaired Mark (272,449) -7.25% (247,433) -8.62% (242,661) -6.86% Loan Carrying Value (1) (2) 370,468 12.01% 400,634 12.04% 386,713 10.82% FDIC Indemnification Asset (3) 228,850 -5.49% 206,37
Slide 52: Loss Share Performance
Loss Share Performance Remaining Projected in thousands Loss Original Estimated Total Losses Projected FDIC Share Estimated Losses to Losses Before OREO Total Threshold Percentages Losses Date (1) for Loans OREO Mark Mark (2) Losses or ILE Community Bank & Trust Starts 80/20 340,039 $ 221,531 $ 113,
Slide 53: Total Assets by Risk Weighting %
$ 2,028 52% $ 610 16% $ 1,114 28% $ 158 4% 100% 50% 20% 0% • Return on Risk Weighted Assets = 0.77% (Peer Median (1) = 0.31%) • Risk Weighted Assets / Total Assets = 63.69% (Peer Median (1) = 72%) Peer % of 100% RWAs = 63.69% Total Assets by Risk Weighting % Source: SNL Financial, FDIC and FFEIC, KB
Slide 54: Investment Portfolio Mix
Investment Portfolio Mix *Fair value for AFS securities; amortized/accreted cost for HTM securities. Does not include FRB stock, FHLB stock, or investment in unconsolidated subsidiaries. Investment Portfolio (AFS & HTM) As of 12/31/11 Tax Equivalent Yield 3.50% Weighted Average Life 3.32 years Modif
Slide 55: Investment Portfolio – December 31, 2011
Investment Portfolio – December 31, 2011 (Dollars in thousands) (1) Includes held-to-maturity and available-for-sale municipal securities. Note: All Agency MBS and CMOs carry the backing of the agency or GSE and have an implied AAA rating. Book Value Market Value Other Comprehensive Income AAA - A B
Slide 56: Fee Income By Type
Fee Income By Type 4Q'10 1Q'11 2Q'11 3Q11 4Q11 Service charges on deposit accounts 5,554 $ 5,030 $ 5,615 $ 6,050 $ 5,959 $ Bankcard services income 2,443 2,659 3,045 2,980 3,037 Mortgage banking income 2,519 863 1,125 2,341 1,942 Trust and investment services income 1,081 1,249 1,525 1,453 1,237 Sec
Slide 57: Continued CD Repricing Opportunities
Continued CD Repricing Opportunities Upcoming Maturities Amount Yield 1st Quarter 2012 252.4 $ 0.72% 2nd Quarter 2012 204.7 $ 0.58% 3rd Quarter 2012 152.0 $ 0.74% Average CD Price in past 3 months 0.37% 57
Slide 58: Georgia Branch Consolidation
Georgia Branch Consolidation • Initial Branch Count: 46 • Phase 1 12 • Phase 2 5 • Phase 3 9 Total Closures 26 • Branch count at end of project: 19 • Cost saves to be recognized (pre-tax) • Phase 2 $6 million - beginning 3rd Q 2011 • Phase 3 $3 million - beginning 1st Q 2012 58
Slide 59: Market Demographics
Market Demographics South Carolina Franchise 18.89% 8.35% $48,788 13.21% North Carolina Franchise 34.87 13.77 66,472 14.20 Georgia Franchise 31.78 9.17 46,447 11.78 National 10.59 3.85 54,442 12.39 Population Growth Rate 2000-2010 2010-2015 Household Median Income 2010 Projected Change 2010-2015 Sou
Slide 60: Unemployment Rates in SCBT Markets
Unemployment Rates in SCBT Markets Georgetown SCBT Divisions Charlotte Greenville/Spartanburg Columbia Georgetown Orangeburg/Low Country Charleston Hilton Head North Georgia SC 9.5% NC 10.4% GA 9.7% Columbia Charlotte Hilton Head Charleston Greenville Orangeburg/Low Country North Georgia 9.6% 10.3%
Slide 61: S.C. Real Estate Markets
S.C. Real Estate Markets Beaufort 974 979 0.5% 175 179 2.3% 175 202 15.4% Charleston Trident 8,757 9,238 5.5% 187 182 -2.7% 106 111 4.7% Coastal Carolinas 7,314 7,550 3.2% 150 139 -7.3% 174 181 4.0% Gr. Columbia 7,210 6,425 -10.9% 142 141 -0.4% 106 119 12.3% Gr. Greenville 6,835 6,666 -2.5% 140 140
Slide 62: Columbia MSA – Economic Drivers
Oconee Pickens Greenville Anderson Spartanburg Cherokee York Union Chester Laurens Abbeville Newberry Greenwood McCormick Saluda Edgefield Aiken Lancaster Chesterfield Kershaw Fairfield Lexington Richland Marlboro Dillon Darlington Lee Sumter Florence Marion Horry Williamsburg Georgetown Clarendon B
Slide 63: Charlotte MSA – Economic Drivers
Charlotte MSA – Economic Drivers HEALTH SERVICES | FINANCIAL | SERVICES | WHOLESALE TRADE MANUFACTURING | TRANSPORTATION Oconee Pickens Greenville Anderson Spartanburg Cherokee York Union Chester Laurens Abbeville Newberry Greenwood McCormick Saluda Edgefield Aiken Lancaster Chesterfield Kershaw Fai
Slide 64: Greenville MSA – Economic Drivers
Oconee Pickens Greenville Anderson Spartanburg Cherokee York Union Chester Laurens Abbeville Newberry Greenwood McCormick Saluda Edgefield Aiken Lancaster Chesterfield Kershaw Fairfield Lexington Richland Marlboro Dillon Darlington Lee Sumter Florence Marion Horry Williamsburg Georgetown Clarendon B
Slide 65: Charleston MSA – Economic Drivers
Oconee Pickens Greenville Anderson Spartanburg Cherokee York Union Chester Laurens Abbeville Newberry Greenwood McCormick Saluda Edgefield Aiken Lancaster Chesterfield Kershaw Fairfield Lexington Richland Marlboro Dillon Darlington Lee Sumter Florence Marion Horry Williamsburg Georgetown Clarendon B
Slide 66: Analyst Recommendations
Analyst Recommendations ANALYST Fourth Quarter 2011 RECOMMENDATION FIG Partners OUTPERFORM Keefe, Bruyette & Woods OUTPERFORM Raymond James MARKET PERFORM Sandler O’Neill + Partners HOLD SunTrust Robinson Humphrey BUY Sterne Agee & Leach Inc. BUY Wunderlich Securities BUY 66
Slide 67: Investor Contacts
Investor Contacts Robert R. Hill, Jr. Chief Executive Officer John C. Pollok Senior Executive Vice President and Chief Operating Officer Donald E. Pickett Executive Vice President and Chief Financial Officer 520 Gervais Street Columbia, South Carolina 29201 800-277-2175 www.scbtonline.com 67