Fifth Third Bancorp · NASDAQ:FITB
Fifth Third Bancorp — Barclays Capital Financial Services Conference 2010
20 slides from Fifth Third Bancorp's conference presentation, May 18, 2010
Slide 1: Barclays Capital Financial Services Conference
Exhibit 99.1 Barclays Capital Financial Services Conference Kevin T. Kabat Chairman, President & Chief Executive Officer May 18, 2010 Please refer to earnings release dated April 22, 2010 and 10-Q dated May 7, 2010 for further information, including full results reported on a U.S. GAAP basis Fifth T
Slide 2: Fifth Third franchise
Fifth Third franchise $113 billion assets (#13) $84 billion deposits (#13) $11 billion market cap (#13)* 16 affiliates in 12 states Michigan 1,309 banking centers Pennsylvania 2,364 ATMs Ohio Illinois Indiana Leading market share in mature Midwest West market Virginia Missouri Kentucky Built strong
Slide 3: Diversified franchise
Diversified franchise Branch Banking (38% of net revenue) 2009 net revenue - $2.8 billion* Retail and business banking $18.4B average loans; $44.6B average core deposits Investment 3.8M customers; 1.4M online banking customers Advisors Commercial Banking (35% of net revenue) $139M Corporate and midd
Slide 4: 1Q10 in review
1Q10 in review Strong operating trends Significant improvements in credit Robust capital levels • Net loss of $10 million • Nonperforming assets declined • Tangible common equity versus 4Q09 net loss of 3% and nonperforming loans ratio of 6.4% $98 million declined 7% sequentially (lowest levels sinc
Slide 5: Peer performance summary
Peer performance summary FITB Regional Midwest SEQ performance bank peers (1) peers (2) 1Q10 vs. peers 1Q10 1Q10 Net interest margin / (bps) 3.63% (+8) 3.60% (+13) 3.37% (+18) Better Operating fee growth* -1% -9% -5% Better Core pre-tax pre-provision earnings* / loans 2.9% 2.7% 2.6% Better Operating
Slide 6: Pre-tax pre-provision earnings
Pre-tax pre-provision earnings Core PPNR trend Core PPNR reconciliation 1Q09 2Q09 3Q09 4Q09 1Q10 Reported PPNR (GAAP) $511 $2,393 $844 $562 $568 Adjustments: $700 Gain on sale of Visa shares - - (244) - - 111 BOLI charge 54 - - - - 73 91 $600 57 Gain from sale of processing interest - (1,764) 6 - -
Slide 7: Stable income and expense in difficult environment
Stable income and expense in difficult environment Core fee income ($M) • Strong mortgage banking results continued in 1Q10, resulting in $3.5B of originations and $152M in net $700 revenue $600 • Investment advisory revenue up 5% from previous qtr $500 • Card and processing revenue sequential decre
Slide 8: Net interest income
Net interest income Core NII and NIM* • Trends in net interest income and net 4.0% $847 $859 $882 $900 $801 interest margin favorably compare with 3.5% $746 $800 peers 3.45% 3.55% $700 3.33% 3.0% 3.13% $600 – NIM up 8 bps in 1Q10 vs. 4Q09 2.92% 2.5% $500 • Expect continued margin benefit 2.0% $400 t
Slide 9: Balance sheet: Continued growth in core funding
Balance sheet: Continued growth in core funding Average loan growth ($B)^ • Extended $18B of new and renewed credit in 1Q10 84 82 • CRE loans down 4% sequentially and 12% from the previous year 80 78 78 34 33 33 – New homebuilder/developer, non-owner occupied CRE suspended 2008 32 33 • C&I loans dow
Slide 10: Improving credit results
Improving credit results Loans 30-89 days delinquent % vs. peers Loans 90+ days delinquent % vs. peers NPA ratio vs. peers Net charge-off ratio vs. peers* Source: SNL and company reports. NPA and NCO ratios exclude loans held-for-sale and covered assets for peers where appropriate. * 4Q08 net charge
Slide 11: Manageable commercial real estate exposure
Manageable commercial real estate exposure CRE / Assets CRE / (TCE + Reserves) 33% 30% Peer average: 18% 473% Peer average: 215% 24% 24% 24% 312% 295% 264% 15% 14% 13% 12% 209% 12% 11% 11% 173% 168% 154% 147% 143% 8% 136% 123% 117% MI MTB ZION RF CMA KEY HBAN FITB STI USB BBT WFC PNC MTB MI RF ZION
Slide 12: Updated credit loss expectations vs. SCAP scenarios
Updated credit loss expectations vs. SCAP scenarios $5,500 Fifth Third $5,250 capitalized for this level of credit Fifth Third’s realized credit losses $5,000 losses under SCAP have been significantly below its (plus surplus raised $5.0B SCAP submitted baseline and $4,750 vs. buffer) more adverse sc
Slide 13: Strong reserve position
Strong reserve position Industry leading reserve level Reserves / Loans 1. FITB 4.91% 4.88% 4.91% 2. KEY 4.34% 5% 4.69% $1,400 3. ZION 4.05% 4.28% $1,200 4. HBAN 4.00% 4% 3.31% 5. RF 3.61% $1,000 6. MI 3.57% 3% 415 196 68 $800 7. PNC 3.38% 283 8 $600 8. WFC 3.22% 2% 9. USB 2.80% 756 $400 10. STI 2.7
Slide 14: Robust capital position
Robust capital position Tier 1 capital ratio (with and without TARP) (TCE + reserves) / Loans Peer average w/ 13.4% 13.1% 12.9% TARP: 11.1% 11.7% 12.0% 11.7% Peer average: 12.8% 11.2% 11.1% 10.4% 10.3% 10.0% 9.9% 9.9% 9.9% 9.6% 8.7% 8.9% 8.3% 8.2% 7.9% 7.4% 16.8% 15.9% 14.3% 14.1% 13.7% Peer average
Slide 15: Strong liquidity profile
Strong liquidity profile Net loans and leases / core deposits Peer average: 104% 111% 112% 116% 102% 105% 106% 107% 107% 98% 98% 99% 92% 94% PNC HBAN RF FITB ZION STI MI KEY BBT WFC MTB CMA USB • Over the past year, Fifth Third has reduced its net noncore funding reliance by 20%, more than any peer
Slide 16: Strong liquidity profile
Strong liquidity profile Holding Company cash at 3/31/10: $1.35B Holding company unsecured debt maturities ($M) — Total Fed deposits ~$4.0B Expected cash obligations over the next 12 months (assuming no $5.0B TARP repayment) — $0 debt maturities — ~$39M common dividends — ~$205M preferred dividends
Slide 17: 2010 developments
2010 developments Macro themes Fifth Third response • Sluggish loan demand • Leverage existing customer relationships at the local level to offer our full portfolio of products and services across all of our lines of business • Deposits to grow but expect some diminution as later liquidity drawn • I
Slide 18: Continuing to invest for the future
Continuing to invest for the future 18 Fifth Third Bank | All Rights Reserved
Slide 19: Summary
Summary Aggressive management of Core franchise remains strong Robust capital levels credit issues • Dedicated to serving the needs • Strong reserve coverage of • Successfully completed June of families and businesses for problem loans 2008 capital plan and SCAP more than 150 years capital actions •
Slide 20: Cautionary statement
Cautionary statement This report may contain statements that we believe are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Rule 175 promulgated thereunder, and Section 21E of the Securities Exchange Act of 1934, as amended, and Rule 3b-6
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