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First — First Commonwealth Financial — Ferris, Baker Watts, Inc. Investor Presentation (August 2007)
29 slides from First's conference presentation, Aug 7, 2007
Slide 1: First Commonwealth Financial Corporation Investor Presentation
FIRST COMMONWEALTH FINANCIAL CORPORATION Ferris, Baker Watts, Inc. Investor Presentation August 8, 2007 Exhibit 99.1
Slide 2: Forward-Looking Statement
FORWARD-LOOKING STATEMENT The matters discussed in this presentation contain forward-looking statements that describe First Commonwealth ’ s future plans, strategies and expectations. All forward-looking statements are based on assumptions and involve risks and uncertainties, many of which are beyon
Slide 3: Presentation Outline
Company Overview Our Challenges Our Leadership Strategic Plan – Back to Basics Household Growth and Retention Market Demographics and Opportunities Alignment Financial Presentation PRESENTATION OUTLINE
Slide 4: Company Overview
Company Overview Full Service Financial Institution ( with origins dating back to 1866 ) Total assets of $5.7 billion at June 30, 2007 111 branches serving 15 Western and Central Pennsylvania counties Fifth largest deposit market share among Pennsylvania-based banks 15 years listed on the New York S
Slide 5: Our Challenges
Our Challenges Tough Interest Rate Environment Inverted Yield Curve Stabilized Net Interest Margin Credit Quality Mature Markets
Slide 6: Our Leadership
Our Leadership Senior Vice President Strategic Resources Thaddeus J. Clements Senior Vice President Investments R. John Previte Senior Vice President Secretary and Treasurer David R. Tomb, Jr. Esq. Executive Vice President Chief Audit Executive William R. Jarrett Executive Vice President Chief Infor
Slide 7: Strategic Plan – Back to Basics
First Commonwealth will be the financial services organization of “ First Choice ” for our marketplace. Strategic Plan – Back to Basics
Slide 8: Exceptional Products
Exceptional Products + Exceptional Service delivered by Exceptional People Strategic Plan – Back to Basics FIRST CHOICE =
Slide 9: Convenience
Convenience Doing it “Right the First Time” Enhanced Web-Banking More branch and ATM locations Expanded branch hours in selected market areas 7 day-a-week availability Strategic Plan – Back to Basics
Slide 10: Household Growth and Retention
Household Growth and Retention Household Retention 1 out of 7 looking for a new bank Reduced Consumer Household Attrition Rate from 14% to 9% in less than 1 year Household Growth Improvement over 2006 Household Opportunities Butler, Washington and Allegheny Counties
Slide 11: Slide 11
Slide 12: Market Demographics and Opportunities
Market Demographics and Opportunities Allegheny, Butler and Washington Counties Number of Households 695,179 Total Market Deposits $50 Billion Median HH Income $47,616 - $52,300 Other Counties in our footprint… Number of Households 566,902 Total Market Deposits $21.5 Billion Median HH Income $36,589
Slide 13: Market Demographics and Opportunities
Market Demographics and Opportunities
Slide 14: Market Demographics and Opportunities
Market Demographics and Opportunities Target Market Segments Women’s Segment Young Savers Segment Affluent & Emerging Affluent Segment Wealth Preservation & Transfer Segment
Slide 15: Aligning Shareholders' Interests with Compensation
Aligning Shareholders’ Interests with Compensation Alignment “I also promise a disciplined approach to aligning shareholders’ interests with compensation. Going forward, our compensation philosophy will emphasize and reward exceptional performance.” - John J. Dolan Excerpt from 2007 Annual Meeting o
Slide 16: Net Interest Margin
Q305 Q405 Q106 Q206 Q306 Q406 Q107 Q207 3.00% 3.20% 3.40% 3.60% 3.80% 4.00% FCF PEER AVG Net Interest Margin Source: SNL Financial
Slide 17: Loan Composition
Loan Composition – as of June 30, 2007 ($ millions) Loans Real Estate - Construction 3% Real Estate - Residential 1,288 35% Real Estate - Commercial 25% Commercial, Industrial, Financial, Agricultural 24% Consumer 13% Total 3,675 100% Loan Composition 3% 35% 25% 24% 13% Real Estate - Construction Re
Slide 18: Real Estate - Residential
Real Estate - Residential 28% 29% 33% 33% 36% 35% 0% 5% 10% 15% 20% 25% 30% 35% 40% Q2 07 Loans goal
Slide 19: Investment Composition
Investment Composition No exposure to Sub-Prime Lending MBS are AAA MBS are valued using Interactive Data, a nationally recognized pricing service Investments Treasuries/Agencies, 11% HTM MBS, 0% AFS Muni (tax free), 14% HTM Muni (tax free), 5% AFS Corporates, 8% Other, 3% AFS MBS/CMO, 59%
Slide 20: Funding Sources
Funding Sources December 31, 2005 3,997 73% 12% 15% June 30, 2007 4,408 86% 3% 11% Deposits Short-term Borrowings Long-term Debt ($ millions)
Slide 21: Deposit Composition
DEPOSIT COMPOSITION – as of June 30, 2007 ($ millions) Deposits Savings/MMDA, 38% Interest DDA, 2% Non-Interest DDA, 12% Time Deposits, 48% Non-Interest DDA $ 12% Interest DDA $ 2% Savings/MMDA 1,652 $ 38% Time Deposits 2,117 $ 48% Total 4,408 $ 100%
Slide 22: Earnings Per Share (Diluted)
Earnings Per Share (Diluted) EPS and Net Income Net Income (dollars in thousands)
Slide 23: Commercial Loan Relationships
Commercial Loan Relationships Commercial Lending Expansion Plans Include: Loan Production Offices in targeted markets Participations Loan Finders Maintain Lending Standards
Slide 24: Asset Quality
Asset Quality .27%* .42%* Source: SNL Financial *Excludes $32.4 million for two credit relationships 0.00 0.30 0.60 0.90 1.20 1.50 2004Y 2005Y 2006Y YTD NPLs / Total Loans Peer Group Average First Commonwealth 0.00 0.20 0.40 0.60 0.80 1.00 2004Y 2005Y 2006Y YTD NPAs/Assets 0.00 0.20 0.40 2004Y 2005Y
Slide 25: Capital Levels
Capital Levels Supports a strong dividend in challenging times Flexibility Expand Lending and Investment programs Pursue Merger and Acquisition opportunities Consider additional buyback programs Capital
Slide 26: Dividends Paid
Dividends Paid $0.00 $0.10 $0.20 $0.30 $0.40 $0.50 $0.60 $0.70 $0.80 Dividend Growth Per Share (adjusted for stock splits) Recognized by Mergent as a “ Dividend Achiever ” Current Dividend Yield > 7%
Slide 27: Summary
1. Strong Leadership/Revenue Driven Strategy 2. Consistent Dividend Growth 3. Strong Dividend Yield and Capital Base Summary
Slide 28: Appendix: Peer Group
APPENDIX PEER GROUP Sun Bancorp, Inc. SNBC F.N.B Corporation FNB S&T Bancorp, Inc. STBA United Bankshares, Inc. UBSI Park National Corporation PRK First Financial Bancorp FFBC WesBanco, Inc. WSBC Harleysville National Corporation HNBC National Penn Bancshares, Inc. NPBC NBT Bancorp Inc. NBTB Provide
Slide 29: Questions?
Questions? On behalf of everyone at First Commonwealth. . . Thank you for your interest in our Company!
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