Fulton Financial Corporation · NASDAQ:FULT

Fulton Financial — Investor Presentation (August 2008)

41 slides from Fulton Financial's investor presentation, Aug 15, 2008

  1. Slide 1: Fulton Financial Corporation Investor Presentation

    Fulton Financial Corporation Investor Presentation August 15, 2008

  2. Slide 2: Forward-Looking Statement

    Forward-Looking Statement The following presentation may contain forward-looking statements about Fulton Financial Corporation’s growth and acquisition strategies, new products and services, and future financial performance, including earnings and dividends per share, return on average assets, retur

  3. Slide 3: Presentation Outline

    Presentation Outline Corporate Overview Growth Initiatives Quarterly Comments Challenges / Responses Loan Summary Financial Performance

  4. Slide 4: Fulton Financial Profile

    Fulton Financial Profile Mid-Atlantic regional financial holding company A family of 10 community banks Fulton Financial Advisors Fulton Mortgage Company Serving strong /stable markets in 5 states 267 community banking offices Asset size: $16 billion Market capitalization: $ 2 billion Book value (6/

  5. Slide 5: Accomplishments - consecutive years of dividend increases

    Accomplishments- 1982 to Present 34 consecutive years of dividend increases 9.8% compounded annual growth rate in dividends per share 7.3% compounded annual growth rate in earnings per share 25 bank acquisitions since 1982 Created a valuable geographic franchise

  6. Slide 6: 10-year Dividend History

    10-year Dividend History 0.2423 0.2672 0.3280 0.3662 0.4524 0.4932 0.5400 0.5810 0.2942 0.4050 0.5975

  7. Slide 7: Quarterly Cash Dividend

    Quarterly Cash Dividend 15 cents Dividend yield: approximately 5%

  8. Slide 8: Capital (as of 06/30/08)

    Capital (as of 06/30/08) Total Capital (GAAP): $1.59 billion Total Regulatory Capital: $1.46 billion Regulatory Capital Ratios: Total Risk-Based Capital 11.70% Tier 1 Risk-Based Capital 9.10% Leverage Capital 7.40%

  9. Slide 9: Strategic Plan

    Strategic Plan Superior Employee Satisfaction Superior Customer Experience Superior Operating Efficiency Superior Financial Results

  10. Slide 10: The Banks

    Ol The Bank The Columbia Bank I Delaware National Bank Bh FNB Bank Fulton Bank Bi Hagerstown Trust Lafayette Ambassador Bank Il The Peoples Bank of Elkton Bh Skylands Community Bank I Swineford National Bank Pennsylvania FULTON FINANCIAL CORPORATION

  11. Slide 11: Q2/08 Quarterly Comments

    Q2/08 Quarterly Comments Reported EPS of $0.15 Impact of three significant events: - Sale of credit card portfolio - Bank stock portfolio write-down - Auction rate certificates Excluding above events: EPS of $0.24 Strong capital position Q3/08 cash dividend declared at current level

  12. Slide 12: Q2/08 Quarterly Comments

    Q2/08 Quarterly Comments Solid results from core banking operations Net interest income growth Expansion of net interest margin Good loan growth New loan pipeline stable Strong growth in select non-interest income categories Revenue generation and cost-cutting initiatives producing meaningful result

  13. Slide 13: Q2/08 Quarterly Comments

    Q2/08 Quarterly Comments Asset quality deterioration Housing-related businesses continue to struggle Little evidence that economic conditions are improving Sluggish deposit growth Bank stock write-down

  14. Slide 14: Two Greatest Challenges

    Two Greatest Challenges Retail Funding Credit Quality

  15. Slide 15: Retail Funding - Action Steps

    Retail Funding - Action Steps Continued denovo expansion in existing and new markets DDA Switch Kit w/cash or gift incentives Targeted direct mail Superior customer experience Relationship banking incentives Team Advantage Banking (small business) Appointed Chief Deposit Officer

  16. Slide 16: Credit Quality – Action Steps

    Credit Quality – Action Steps Internal emphasis on loan review / workout Watching all loan portfolios very carefully, real estate in particular Early customer intervention / remediation as problems arise New loans underwritten to traditional conservative standards

  17. Slide 17: Superior Customer Satisfaction

    Superior Customer Satisfaction *Retail: 90% extremely/very satisfied Commercial: 90% extremely/very satisfied * Compared to national average of 63% Source: American Banker/Gallup Consumer Survey

  18. Slide 18: Summary of Larger Loan Relationships

    Summary of Larger Loans 46 relationships with commitments to lend of $20 million or more Maximum individual commitment of $33 million Average commercial lending relationship size is $ 417,538 Loans and corresponding relationships are within Fulton’s geographic market area

  19. Slide 19: Loan Diversification (as of 06/30/08)

    Loan Diversification (as of 06/30/08) 8% 14% 11% 32% 31% 4% Commercial Commercial Mortgage Res Mtg Home Equity Construction Consumer and other

  20. Slide 20: Commercial Loan Concentration By Industry

    Commercial Loan Concentration By Industry (as of 06/30/08) Industry % Construction 25.9 RE - Investor - Owned 23.6 Services 14.2 Manufacturing 7.0 Retail 6.1 Health Care 5.4 Agriculture 5.0 Wholesale 4.5 Other 3.1 Financial Services 2.0 Arts and Entertainment 2.0 Transportation 1.2 100.0

  21. Slide 21: Credit Ratings

    Credit Ratings Long-term rating Issuer A-2 Lead Bank Deposits A-1 Outlook Negative Moody’s Investor Services Short-term rating F-1 Long-term rating A- Outlook Stable Fitch Ratings Dominion Bond Rating Service Credit rating A Outlook Negative

  22. Slide 22: Fulton Financial Corporation

    ‘FULTON FINANCIAL ‘CORPORATION

  23. Slide 23: Quarter Ended June 30, 2008

    Quarter Ended June 30, 2008 $25.7 million Net income $ 0.15 Net income per share $ 0.15 Cash dividends per share 0.85% Return on assets 8.40% Return on equity 14.65% Return on tangible equity

  24. Slide 24: Peer Group

    Peer Group International Bancshares Corporation Old National Bancorp South Financial Group, Inc. Susquehanna Bancshares, Inc. TCF Financial Corporation Trustmark Corporation UMB Financial Corporation United Bankshares, Inc. Valley National Bancorp Whitney Holding Corporation Wilmington Trust Corpora

  25. Slide 25: Income Statement Summary (Six Months Ended June 30th)

    Income Statement Summary (Six Months Ended June 30 th ) (dollars in thousands) 257,790 $ 242,680 $ 15,110 $ 6% (27,930) (3,660) (24,270) n/m 76,320 73,660 2,660 4% 13,910 - 13,910 n/m (20,400) 2,410 (22,810) n/m (206,390) (199,010) (7,380) 4% (26,130) (35,110) 8,980 -26% 67,170 $ 80,970 $ (13,800) $

  26. Slide 26: Income Statement Summary (Linked Quarter)

    Income Statement Summary (Linked Quarter) (dollars in thousands) 131,890 $ 125,900 $ 5,990 $ 5% (16,710) (11,220) (5,490) n/m 39,890 36,430 3,460 9% 13,910 - 13,910 n/m (21,650) 1,250 (22,900) n/m (109,740) (96,660) (13,080) 14% (11,910) (14,200) 2,290 -16% 25,680 $ 41,500 $ (15,820) $ -38% 2nd Q 08

  27. Slide 27: Average Loans (Six Months Ended June 30th)

    Average Loans (Six Months Ended June 30th) (dollars in millions) 3,490 $ 3,100 $ 390 $ 13% 3,620 3,260 360 11% 880 710 170 24% 1,550 1,440 110 8% 1,310 1,390 (80) -6% 510 600 (90) -15% 11,360 $ 10,500 $ 860 8% $ % Commercial Comm'l Mort Resid Mort Home Equity Construction Cons./Other Total Loans

  28. Slide 28: Average Loans (Linked Quarter)

    Average Loans (Linked Quarter) (dollars in millions) 3,510 $ 3,470 $ 40 $ 1% 3,700 3,550 150 4% 890 860 30 3% 1,570 1,530 40 3% 1,290 1,330 (40) -3% 460 560 (100) -18% 11,420 $ 11,300 $ 120 1% 2nd Q 08 1st Q 08 $ % Commercial Comm'l Mort Resid Mort Home Equity Construction Cons./Other Total Loans

  29. Slide 29: Net Interest Margin (as of 06/30/08)

    Net Interest Margin (as of 06/30/08) 3.67 3.65 3.28 3.25 3.50 3.75 4.00 4.25 4.50 4.75 FFC Peer Top 50

  30. Slide 30: Net Interest Margin Trend

    Net Interest Margin Trend 3.50 3.60 3.70 3.80 3.90 4.00 Q1 06 Q2 06 Q3 06 Q4 06 Q1 07 Q2 07 Q3 07 Q4 07 Q1 08 Q2 08 Reported Core

  31. Slide 31: Interest Rate Shocks (as of 06/30/08)

    Interest Rate Shocks (as of 06/30/08) 6 month cumulative gap – 0.97 Rate Change NII Change (Annual) % Change +300 bp + $ 12.1 million + 2.3% +200 bp + $ 9.4 million + 1.8% +100 bp + $ 5.4 million + 1.0% - 100 bp - $ 6.0 million - 1.1% - 200 bp - $ 14.3 million - 2.7%

  32. Slide 32: Investment Portfolio (as of 06/30/08)

    Investment Portfolio (as of 06/30/08) ENDING MODIFIED BALANCE DURATION CREDIT RATING (000's) Mortgage-backed securities 1,238.4 $ 3.16 AAA Municipal bonds 511.3 4.28 AAA Collateralized mortgage obligations 402.1 3.73 AAA U.S. Treasuries and agencies 98.0 2.34 AAA Corporate & trust preferred securiti

  33. Slide 33: Average Deposits (Six Months Ended June 30th)

    Average Deposits (Six Months Ended June 30th) (dollars in millions) 1,640 $ 1,740 $ (100) $ -6% 1,700 1,670 30 2% 2,170 2,300 (130) -6% 4,430 4,490 (60) -1% 700 600 100 17% 10,640 $ 10,800 $ (160) $ -1% $ % Nonint DDA Int DDA Savings/MMDA CD's Cash Mgt Total Deposits

  34. Slide 34: Average Deposits Linked Quarter

    Average Deposits Linked Quarter (dollars in millions) 1,660 $ 1,620 $ 40 $ 2% 1,710 1,690 20 1% 2,210 2,140 70 3% 4,360 4,510 (150) -3% 690 700 (10) -1% 10,630 $ 10,660 $ (30) $ 0% 2nd Q 08 1st Q 08 $ % Nonint DDA Int DDA Savings/MMDA CD's Cash Mgt Total Deposits

  35. Slide 35: Net Charge-Offs To Loans (as of 06/30/08)

    Net Charge-Offs To Loans (as of 06/30/08) 0.45 0.69 0.24 0.00 0.10 0.20 0.30 0.40 0.50 0.60 0.70 0.80 FFC Peer Top 50

  36. Slide 36: Other Income (Six Months Ended June 30th)

    Other Income (Six Months Ended June 30th) (dollars in thousands) Invt Mgt & Trust 17,150 $ 20,080 $ (2,930) $ -15% Overdraft & NSF Fees 16,330 9,980 6,350 64% Cash Mgt Fees 6,560 5,560 1,000 18% Service Charges 6,390 6,310 80 1% Mort. Sales Gains 4,980 9,580 (4,600) -48% Success Card Fees 4,820 4,14

  37. Slide 37: Other Income Linked Quarter

    Other Income Linked Quarter (dollars in thousands) Overdraft & NSF Fees 8,640 $ 7,690 $ 950 $ 12% Invt Mgt & Trust 8,390 8,760 (370) -4% Service Charges 3,350 3,040 310 10% Cash Mgt Fees 3,330 3,230 100 3% Mort. Sales Gains 2,670 2,310 360 16% Success Card Fees 2,550 2,260 290 13% Merchant Fees 1,90

  38. Slide 38: Efficiency Ratio (as of 06/30/08)

    Efficiency Ratio (as of 06/30/08) 57.0 60.7 60.4 50.0 52.0 54.0 56.0 58.0 60.0 62.0 64.0 FFC Peer Top 50

  39. Slide 39: Other Expense (Six Months Ended June 30th)

    Other Expense (Six Months Ended June 30 st ) (dollars in thousands) Salaries & Benefits 109,480 $ 111,850 $ (2,370) $ -2% Occupancy & Equip. 27,610 27,300 310 1% Operating Risk Loss 15,630 10,120 5,510 54% Data Proc. & Software 9,140 8,790 350 4% Advertising 6,420 5,400 1,020 19% Supplies & Postage

  40. Slide 40: Other Expense Linked Quarter

    Other Expense Linked Quarter (dollars in thousands) Salaries & Benefits 54,280 $ 55,200 $ (920) $ -2% Operating Risk Loss 14,390 1,240 13,150 n/m Occupancy & Equip. 13,640 13,970 (330) -2% Data Proc. & Software 4,480 4,660 (180) -4% Advertising 3,520 2,910 610 21% Supplies & Postage 2,980 2,810 170

  41. Slide 41: Fulton Financial Corporation

    Fulton Financial Corporation One Penn Square Lancaster, PA 17602 www.fult.com

Fulton Financial — Investor Presentation (August 2008) on 6ix