Wesbanco, Inc. · NASDAQ:WSBC
Wesbanco — Midwest SuperCommunity Bank Conference (February 2009)
34 slides from Wesbanco's conference presentation, Feb 24, 2009
Slide 1: Midwest SuperCommunity Bank Conference
Midwest SuperCommunity Bank Conference February 24, 2009
Slide 2: Forward-Looking Statements
Forward-Looking Statements Forward-looking statements in this presentation relating to WesBanco’s plans, strategies, objectives, expectations, intentions and adequacy of resources, are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The informatio
Slide 3: Explanation of Certain Non-GAAP Measures
Explanation of Certain Non-GAAP Measures This presentation contains certain financial information determined by methods other than in accordance with Generally Accepted Accounting Principles (GAAP). Specifically, the Company has provided financial measures that are based on core or operating earning
Slide 4: WesBanco at a Glance
WesBanco at a Glance • Headquarters in Wheeling, West Virginia • Founded in 1870 • Assets: $5.2 billion • 32 Banks/23 Companies Acquired in 25 years • Banking operations in WV, OH and PA 109 banking offices + Pittsburgh LPO 139 ATMs • Non-bank activities include: Wealth management, securities
Slide 5: Stock Trading Profile
Stock Trading Profile • Ticker: WSBC (NASDAQ Global Select) • Market capitalization: $452 million* • Average daily shares traded: 100,390 (3 mos. avg.) • 26.5 million shares outstanding, 93% float • 46.2% institutional ownership * As of 02/23/2008 - $17.03 per share
Slide 6: WesBanco Operating Model
WesBanco Operating Model Growth by Centralized Local Delivery Acquisition Operations Provides Consistent Performance • Experienced management team • Incentives aligned to performance
Slide 7: Stability of Earnings Stream
Stability of Earnings Stream GAAP Income Core Earnings PreTaxPreProv. Core EPS (MM) $100 $3.00 5-year CAGRs: Core Earnings = 2.7% $80 PreTax & Prov = 7.6% $2.00 $60 $40 $1.00 $20 $0 $0.00 2003 2004 2005 2006 2007 2008* *Avg. # shares up 24.1% in 2008 from 5.2 MM shares issued in November 2007 for ac
Slide 8: Experienced & Stable Management Team
Experienced & Stable Management Team Years in Years with Executive Position Banking WSBC James Gardill Chairman of the Board 35 28 Paul Limbert President & CEO 31 31 Dennis Powell EVP & COO 35 4 Robert Young EVP & CFO 22 7 Peter Jaworski EVP & Chief Credit Officer 24 13 Jerome Schmitt EVP - Trust &
Slide 9: Growth by Acquisition: A WSBC Core Competency
Growth by Acquisition: A WSBC Core Competency (MM) Total Assets $6.0 7 year CAGR = 13.3% • Four major acquisitions in $5.0 six years – assets more $4.0 than doubled since 2001 $3.0 • A history of successful consolidations/EPS growth $2.0 • Focusing on higher growth $1.0 metro markets and enhancing m
Slide 10: Recent Acquisition Activity
Recent Acquisition Activity • AmTrust AmTrust Bank Bank Branches Branches -- -- Announced Announced January January 23, 23, 2009 2009 –– $600 $600 million million in in deposits deposits @3.5% @3.5% deposit deposit premium premium –– Five Five additional additional offices offices in in greater grea
Slide 11: An Expanding Franchise in Contiguous Markets
An Expanding Franchise in Contiguous Markets: 109 banking offices • Banking operations in 37 counties • Expanding along major highways to population Wheeling centers (Columbus, Dayton, Cincinnati) • Ranked #1-3 in deposit market share in 16 counties* • Wheeling, WV HQ for holding co. activities • Tw
Slide 12: Wealth Management Services
Wealth Management Services • $2.4B of assets under management & administration • Over 5,000 trust relationships • 3 locations in WV & 1 in Assets Under Management ($B) Columbus, OH ($B) ($B) Management Fees ($MM) ($MM) ($MM) $5.0 $20 • Extensive product capabilities: $4.0 $16 Trust $3.0 $12 Inve
Slide 13: Stable Deposit Mix: ~52% Non-Maturity
Stable Deposit Mix: ~ 52% Non-Maturity Brokered CDs CDs Savings MMDA Interest Bearing 100% Non-Interest Bearing • Stable mix despite high level of acquisition activity 80% • Very low brokered CDs • Decrease in single-service CD 60% households • More than 50% of total deposits 40% now originate in Oh
Slide 14: Securities Portfolio at Dec. 31, 2008
Securities Portfolio at Dec. 31, 2008 Agencies • Minimal private label CMOs or 5% corporate/ABS securities Mortgage- Municipals, • 85% of municipal bonds are backed/CMO 38% insured; 80% are GOs securities, 56% • Average yield of 5.51% at year-end • WAL approx. 4.2 years Corporates & Equities, 1% • P
Slide 15: Expanding Net Interest Margin
Expanding Net Interest Margin ~ Up 31 bp in 2008 to 3.71% ~ WSBC NIM Yield on EA Cost of Int. Bearing Liab. W SBC NIM Peer NIM 10.00% Earning Assets Yield down 59 bp WSBC = +31 bp vs. Peers = +17 bp while Cost of Funds down 100 bp 3.70% 3.84% 3.81% 3.89% 3.72% 8.00% 3.75% 3.70% 3.71% 3.40% 3.48% 6.0
Slide 16: Growing Noninterest Income
Growing Noninterest Income* Deposit Service Fees Trust Fees ($MM) Other BOLI Gain on Loan Sales • 2008 includes full-year $60 contribution of OAKF 4-year CAGR = 14.3% $50 • Noninterest income contributed 26.3% of $40 2008 revenue $30 • Deposit service fees & charges up 30.7% from $20 2007 $10 • Trus
Slide 17: Loan Portfolio as of Dec. 31, 2008
Loan Portfolio as of Dec. 31, 2008 Total Loans O/S = $3.6 B Comm. RE = $1.7 B Commercial & Industrial Construction Construction 14% Investor-Owned Investor-Owned & & Develop. Develop. Consumer 50% 50% 14% 14% 9% Commercial HELOC, 6% Real Estate, 47% Res. Real Estate, 24% Owner-Occupied Owner-Occupie
Slide 18: Centralized Credit Administration
Centralized Credit Administration • Senior credit officer in each region, reports directly to CCO • Senior commercial bankers and support pods located by market • Centralized credit administration and commercial underwriting on loans > $500K • Local loan approval up to $750K - greater requires senio
Slide 19: WSBC Passes the <300% CRE Stress Test
WSBC Passes the <300% CRE Stress Test C&D + Investor-owned CRE = 195% of Total Risk Based Capital % of Risk- Commercial Real Estate Loans $MM O/S Based Capital % of CRE Land & development 90 16.2 5.3 Residential development 60 10.8 3.5 Commercial construction 81 14.6 4.8 Total Construction & Develop
Slide 20: Non-Performing Assets = 1.10% of Assets
Non-Performing Assets = 1.10% of Assets (Includes 90+ Days Past Due) 90+ Days Past Due = $19MM $58 Million as of 12/31/08 Cons, 6% C&I, 16% HELOC, 5% 90+ Days PD CRE, 16% 33% Res RE, 57% OREO, 4% Nonaccruals, Non-Accruals/Rest. = $36MM 63% Res RE, 3% C&I, 15% CRE, 82%
Slide 21: Credit Performance vs. Peers
Credit Performance vs. Peers NPA NPA ++ >90 >90 Days Days PD PD Loans Loans // Total Total Assets Assets Net Net Charge-offs Charge-offs // Avg. Avg. Loans Loans WSBC Peer* WSBC Peer* 1.60% 1.20% 1.20% 0.90% 0.80% 0.60% 0.40% 0.30% 0.00% 0.00% 4Q 1Q 2Q 3Q 4Q 4Q 1Q 2Q 3Q 4Q 2007 2008 2008 2008 2008 2
Slide 22: Financial Results
Financial Results
Slide 23: A Strong 2008 Performance
A Strong 2008 Performance despite the many challenges • Total shareholder return of 38% for FY 2008 • Successfully integrated largest acquisition to date • Bolstered loan loss reserves by 29% • Opted to participate in TARP Capital Purchase Program • Exceptionally well-capitalized • Earned 5-Star Sup
Slide 24: Full Year Performance
Full Year Performance ($000’s except per share data) 2007 2008 % Peer* Core Income $44,092 $39,410 -10.6% N/A Loan Loss Prov. $8,516 $32,649 + 383% N/A Diluted Core EPS $2.06 $1.47 -28.6% N/A Core ROAA 1.08% 0.75% -30.5% 0.72% ROATE 17.83% 12.59% -29.4% 7.49% NIM 3.44% 3.68% +24 bps 3.55% NCO/Avg Lo
Slide 25: PreTax PreProv. Profitability Returns to ~Pre-OAKF Level
PreTax PreProv. Profitability Returns to ~Pre-OAKF Level Net Interest Income/Avg. Assets Operating Expenses/ Avg. Assets Noninterest Income/ Avg. Assets 4.25% 4.34% 4.28% 4.18% 4.00% 4.13% 2.69% 2.54% 2.68% 2.66% 2.53% 2.39% 1.24% 0.93% 1.08% 0.93% 0.83% 1.09% PreTax & 2005 2006 2007 2008 1Q'08 4Q'0
Slide 26: Risk Management: Interest Rate Sensitivity
Risk Management: Interest Rate Sensitivity Immediate Change % Change in Net Interest Income from in Interest Rates Base Over One Year Dec. 31, 2007 Dec. 31, 2008 Up 3% Rate Shock -16.2% -1.9% Up 2% Rate Shock -10.2% -0.5% Up 2 % Rate Ramp -3.4% +0.7% Up 1% Rate Shock -5.0% +0.8% Down 1% Rate Shock +
Slide 27: Risk Management: Liquidity
Risk Management: Liquidity • Liquid assets $936 MM securities portfolio – over 40% unpledged $141 MM cash and cash equivalents • Deposits $1.8 B in non-maturity deposits Only 15% jumbo/brokered deposits • FHLB line of credit $850 MM availability at year-end • Other Lines of credit with b
Slide 28: Risk Management: Strong Capital Base
Risk Management: Strong Capital Base Tangible Equity / Tangible Assets Total Risk Based Capital 15.00% • Total Risk-Based Capital = 14.78% 12.00% • TARP recipient: $75MM 9.00% • Low portfolio impairment risk/no toxic investments 6.00% • Tangible equity is strong at 7.90%/TCE at 6.44% 3.00% • Suffici
Slide 29: 23+ Years of Strong, Stable Dividends
23+ Years of Strong, Stable Dividends $1.20 3:2 Split $0.90 2:1 Split $0.60 $0.30 $0.00 1985 1988 1991 1994 1997 2000 2003 2006 • 23 year compound annual growth: 5.46% • Current yield: 6.58%11 and $1.12 per share annualized • Analysts’ projections cover dividend run rate • 20 year total shareholder
Slide 30: 2009 Initiatives
2009 Initiatives • Loans: Loans: Shift Shift to to C&I C&I lending lending from from real real estate estate • Improve Improve credit credit infrastructure infrastructure –– –– Add Add staff staff to to Special Special Assets, Assets, Credit Credit Risk Risk Management Management and and Secured Sec
Slide 31: Why WesBanco?
Why WesBanco? • Responsive to market needs • Efficient structure for delivery of banking services • Proven ability to mitigate risk • Financially conservative • Attractive shareholder returns over time
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Slide 33: Reconciliation – GAAP to Core
Reconciliation – GAAP to Core Annual 2004 2005 2006 2007 2008 Net Income before Taxes 47,158 54,479 48,298 52,690 42,610 Gain (loss) on Sale of Securities 2,768 2,021 (7,798) 943 1,556 Non-recurring Revenue 0 0 2,784 980 400 Merger related and restructuring expenses, net of 397 1,530 540 635 3,945 t
Slide 34: Reconciliation – GAAP to Core
Reconciliation – GAAP to Core Quarterly 4Q’07 1Q’08 2Q’08 3Q’08 4Q’08 Net Income before Taxes 11,751 11,754 13,657 12,635 4,564 Gain (loss) on Sale of Securities 204 505 400 276 374 Non-recurring Revenue 0 400 0 0 0 Merger related and restructuring expenses, net of 635 1,047 1,656 539 701 taxes Gain
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