Fulton Financial Corporation · NASDAQ:FULT
Fulton Financial — Investor Presentation (May 2007)
56 slides from Fulton Financial's investor presentation, May 22, 2007
Slide 1: Fulton Financial Corporation Investor Presentation May 2007
Fulton Financial Corporation Investor Presentation May 2007
Slide 2: Forward-looking statements
| 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, return on average equity, eff
Slide 3: Agenda
™ Corporate profile @ Strategies & Growth initiatives @ Capital ® Loan summary | Customer and employee satisfaction § Financial performance ® Opportunities @ Questions
Slide 4: Regional financial holding company
® Regional financial holding company (formed in 1982) ™12 community banks and 3 financial services affiliates in 5 states ™ 265 community banking offices Asset size: $14.7 billion @ Market capitalization: $2.6 billion
Slide 5: Where are we located?
Where are we located? The Bank 1B The Columbia Bank 1 Delaware National Bank FNB Bank 1 Futon Banke Hagerstown Trost 1 Lafyere Ambassador Bank Lebanon Vale Farmers Bank 1 The Peoples Bank of Econ 1B Resource Bank 1 Shands Community Bank 1 Swineford Nasional Bank Nie ai fap ee FULTON FINANCIAL ‘CORPO
Slide 6: Bank consolidations completed and pending
Completed ° Premier Bank into Fulton Bank, PA (12/06) ° First Washington State Bank into The Bank, NJ (2/07) * Somerset Valley Bank into Skylands Community Bank, NJ (5/07) ™Pending * Lebanon Valley Farmers Bank into Fulton Bank, PA (7/07)
Slide 7: More efficient operation
™More efficient operation ™More effectively leverage brand over larger market while maintaining local authority
Slide 8: National Ranking in Median HH Income
National Ranking in Median HH County Ranking _ State Ranking FFC Affiliate Fairfax, VA E <i] #2 $101,762 Resource Bank Hunterdon, NJ #4 4H $100,485 Skylands Bank Morris, NJ E =) #2 $96,965 Skylands Bank Somerset, NJ #6 F<] $96,350 Skylands Bank Howard, MD #7 #H $92,433 Columbia Bank Montgomery, MD =
Slide 9: County Rank
County Rank Chester, PA Montgomery, PA Bucks, PA Delaware, PA Cumberland, PA Northampton, PA Lancaster, PA York, PA Lehigh, PA Berks, PA Average Sge0nonaune Average of all other (67) Projected Change 2006 - 2011 9.63% 3.05 4.06 0.17 437 8.45 462 6.18 5.46 5.62 4.66 1.20 Median HH Income 2006 $83,001
Slide 10: Proven business model
™ Proven business model ™ Consistent performance ™ 25 consecutive years of record earnings ™33 consecutive years of dividend increases ™ 10.1% compounded annual growth rate in dividends per share ™8.5% compounded annual growth rate in earnings per share (last 5 years = 7.0%) @ 25 bank acquisitions 1
Slide 11: Returns with and without dividend reinvestment
® WITHOUT dividend reinvestment: 13% compounded annual rate of return ® WITH dividend reinvestment: 17% compounded annual rate of return TT
Slide 12: 10-year Dividend History
10-year Dividend History 0.5810 0.5400 0.4932 0.4524 0.4050 o.s280 9-3662 0.2672 0.2842 02202 9:2428 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 =f 8 8 8 8 & & FultonFinancial Coportion | © 2 2 2 mo R
Slide 13: Dividend increase
Slncreased to 15 cents @Payable on July 15 ™Record date: June 20 ™Dividend yield: 4% B
Slide 14: Long-term successful employees, customers, shareholders
SLong-term SLong-term SLong-term successful » successful » successful employees customers shareholders 4
Slide 15: Superior performance
®Superior financial performance ®Superior operating efficiency MSuperior customer experience ™Superior employee satisfaction 15
Slide 16: Company-wide promotions for fee-generating products
=Company-wide promotions to increase referrals for fee-generating products and services: Fulton Financial Advisors ™Cash Management Credit and debit cards Leasing Sinternational services 16
Slide 17: Standardize and centralize
™Standardize and centralize where appropriate Increase productivity through technology ‘@ @ Fulton Financial Cor rd
Slide 18: Organic growth markets by bank
& Fulton Bank (Pa) « State College * Chester County ®@ The Bank (NJ) * Atlantic County * Burlington County «= Camden County @ The Columbia Bank (MD) * Frederick County * Anne Arundel County ® Resource Bank (VA) * Richmond 18
Slide 19: Key Organic Growth Markets
Key Organic Growth Markets FULTON FINANCIAL CORPORATION So ee 8 & Fulton
Slide 20: Additional cash management product options
® Additional cash management product options to keep funds on balance sheet ™ Market segmentation / targeted direct mail ™ Corporate-wide sales / incentive programs | Remote deposit item capture / business clients ™ Corporate credit card rewards program = Small business segment Affiliate CEO scoreca
Slide 21: Future Expansion
Future Expansion Wi Current Markets Di Future Expansion IN FINANCIAL
Slide 22: Total Capital and capital ratios
® Total Capital (GAAP): $1.5 billion & Total Regulatory Capital: $1.3 billion @ Ratios: * Total Risk-Based Capital 12.20% * Tier 1 Risk-Based Capital 10.30% - Leverage Capital 7.95% wy
Slide 23: April 2007 share buyback announced
® April 2007: 1 million share buyback announced ™Timeframe: through 12-31-07 B
Slide 24: Loan Diversification
Loan Diversification @/31/07 6% 13% = Commercial 30% Commercial Mortgage @ Res Mtg and Home Equity 20% = Construction = Consumer and other 31% =f 8 8 8 8 & & FultonFinancial Coportion | © 2 2 2 mo 4
Slide 25: Relationships of $20 million or more
© 43 relationships with commitments to lend of $20 million or more ® Maximum individual commitment of $33 million @ Average commercial lending relationship size is $389,573 ™@ Loans and corresponding relationships are within Fulton’s geographic market area B
Slide 26: First quarter 2007 results
"$41.1 million Net income (6.3% decrease from 2006) ™$ 0.24 Net income per share (4.0% decrease from 2006) ™$ 0.1475 Cash dividends per share (6.9% increase over 2006) = 112% Return on assets = 11.06% Return on equity = 20.34% Return on tangible equity 6
Slide 27: Credit ratings
Moody’s Investor Services Standard & Poors ® Short-term rating P-1 © Credit rating BBB+ ® Long-term rating @ Outlook Stable Issuer A-2 Lead Bank Deposits A-1 1 Outlook Stable Fitch Ratings Dominion Bond Rating Service © Short-term rating F-1 © Credit rating A ® Long-term rating A ™ Outlook Stable ™
Slide 28: Employee Retention
Employee Retention 100 _ @ Exempt Non-exempt = Overall 2002 2003 2004 2005 2006 =f 8 8 8 8 & & FultonFinancial Coportion | © 2 2 2 mo 28
Slide 29: Customer satisfaction
© *Retail: * 90% extremely/very satisfied = Commercial: * 90% extremely/very satisfied © Fulton Financial Advisors: * 80+% very satisfied/satisfied | Fulton Mortgage Company: * 99% of expectations met/exceeded * 98% would recommend FMC to others *compared to national average of 62% Source: American
Slide 30: 2006 results
™ $185.5 million ™$ 1.06 ™$ 0.581 = 1.30% = 12.84% = 23.87% Net income (11.7% increase over 2005) Net income per share (6.0% increase over 2005) Cash dividends per share (7.6% increase over 2005) Return on assets Return on equity Return on tangible equity 30
Slide 31: Peer group companies
Associated Banc-Corp BancorpSouth, Inc. Bank of Hawaii Corporation BOK Financial Corporation Citizens Banking Corporation City National Corporation Colonial BancGroup, Inc. Commerce Bancshares, Inc. Cullen/Frost Bankers, Inc. First Citizens BancShares, Inc. First Midwest Bancorp, Inc. First Republic
Slide 32: Peer Group Diluted EPS
PEER GROUP Diluted EPS Ticker Company Name City State 20062005 % 1 TSG — SouthFinancial Goup, Inc. Greenville sc 1.49 0.94 SB. 2 WINY Whitney Holding Corporation New Orleans LA 2.20 163 35.0% 3 ONB Old National Bancorp Evansville N 1.20 0.93 29.0% 4 TRMK = Trustmark Corporation Jackson MS 2.09 161 1
Slide 33: Peer Group Diluted EPS (continued)
PEER GROUP Diluted EPS Ticker Company Name City State _2006_ 2005 % 15 CBSH CommerceBancshares, Inc. KansasCity MO 308 16 SKYF —SkyFinancial Group, Inc. BowlingGreen OH 172 17 MRBK Mercantile Bankshares Corporation Baltimore MD 23 18 CYN City National Corporation BeveryHills CA 466 19 VLY Valley Nat
Slide 34: Income statement summary
2007 2006 $ % (dollars in thousands) Net Interest Income $ 121,780 $ 115,040 $ 6,740 6% Loan Loss Provision (960) (1,000) 40 4% Other Income 37,280 33,940 3,340 10% Securities Gains 1,780 2,670 (890) -33% Other Expenses (100,900) (88,010) (12,890) 15% Income Taxes (17,850) (18,760) 910 -5% Net Incom
Slide 35: Loans period-end
2007 2006 $ % (dollars in millions) Commercial $ 3,030 $ 2,610 420 16% Comm'l Mort 3,240 2,940 300 10% Resid Mort/HE 2,140 1,920 220 11% Construction 1,400 1,160 240 21% Cons./Other 600 600 - 0% Total Loans $ 10,410 $ 9,230 1,180 13% 8
Slide 36: Loans average balances
2007 2006 $ % (dollars in millions) Commercial $ 3,030 $ 2,710 320 12% Comm'l Mort 3,240 2,990 250 8% Resid Mort/HE 2,140 2,000 140 ™ Construction 1,400 1,310 90 ™% Cons./Other 600 580 20 3% Total Loans $ 10,410 $ 9,590 820 9% 6
Slide 37: Loans linked quarter
1stQ07____ 4th Q.06 $ % (dollars in millions) Commercial $ 3,030 $ 2,930 $ 100 3% Comm'l Mort 3,240 3,190 50 2% Resid Mort/HE 2,140 2,150 (10) 0% Construction 1,400 1,430 (30) -2% Cons./Other 600 610 (et) -2% Total Loans $ 10,410 $10,310 100 1% 7
Slide 38: FFC versus peer and Top 50
94.95 96 97 98 99 OO O1 O2 O03 O4 05 06 3/07 —*-FFC -* Peer = Top 50 Fulton Financial Corp 38
Slide 39: Interest rate sensitivity
Rate Change NI Change (Annual) % Change +300 bp + $ 28.4 million + 5.8% +200 bp +$ 19.0 million + 3.9% +100 bp +$ 9.6 million + 2.0% - 100 bp - $11.7 million - 24% - 200 bp - $25.9 million - 5.3% - 300 bp - $ 40.0 million - 8.2% 6 month cumulative gap - 0.98 39
Slide 40: Investment portfolio
Mortgage-backed securities $ 1,239.8 2.86 AAA Municipal bonds 501.8 4.43 AAA Collateralized mortgage obligations 345.0 2.71 AAA U.S. Treasuries and agencies 300.2 2.24 AAA Corporate & trust preferred securities 59.8 5.72 various - 5 yr call Bank stocks 94.2 NA Not rated FHLB stock 96.6 NA AAA Other
Slide 41: alll
9 8 7 6 5 4 3 2 1 0 alll FPA PP MG IOS IHS ES = al
Slide 42: Funding Sources
Funding Sources 63107 1% 11% = Deposits and Customer Repurchase Agreements 14% Borrowings = GAAP Capital @ Other Liabilities 74% =f 8 8 8 8 & & FultonFinancial Coportion | © 2 2 2 mo 2
Slide 43: Deposits period-end
2007 2006 $ % (dollars in millions) Nonint DDA $ 1,720 $ 1,770 (50) -3% Int DDA 1,660 1,670 (10) -1% Savings/MMDA 2,300 2,270 301% CD's 4,460 3,740 720 19% Cash Mgt 570 430 140 33% Total Deposits $10,710 $ 9,880 830 8%
Slide 44: Deposits average balances
2007 2006 $ (dollars in millions) Nonint DDA $ 1,720 $ 1,850 $ (130) -7% Int DDA 1,660 1,700 (40) -2% Savings/MMDA 2,300 2,330 (30) -1% CD's 4,460 3,900 560 14% Cash Mgt 570 480 90 19% Total Deposits $ 10,710 $ 10,260 450 4%
Slide 45: Deposits linked quarter
1stQ07 _4thQ 06 (dollars in millions) $ % Nonint DDA $ 1,720 $ 1,780 $ (60) -3% Int DDA 1,660 1,660 - 0% Savings/MMDA 2,300 2,340 (40) -2% CD's 4,460 4,410 50 1% Cash Mgt 570 600 (30) -5% Total Deposits $10,710 $ 10,790 $ (80) -1%
Slide 46: FFC versus peer and Top 50 chart
0.70 0.60 0.50 0.40 0.30 0.20 0.10 0.00 90 91 92 93 94 95 96 97 98 99 OO Ol 02 03 04 05 06 307 -*FFC ~— Peer = Top 50
Slide 47: FFC versus peer and Top 50 chart
90 91 92 93 94 95 96 97 98 99 OO Ol O2 03 04 05 06 307 -*FFC — Peer = Top 50 Fulton Financial Coy aT
Slide 48: Non-interest income year over year
2007 2006 $ % (dollars in thousands) Invt Mgt & Trust $ 9,810 $ 10,030 $ (220) -2% Mort. Sales Gains 5,390 4,770 620 13% Overdraft & NSF Fees 4,770 4,600 170 4% Service Charges 3,150 3,320 (170) -5% Cash Mgt Fees 2,700 2,320 380 16% Success Card Fees 1,920 1,720 200 12% Other 9,540 7,180 2,360 __ 33
Slide 49: Non-interest income average comparison
2007 2006 $ % (dollars in thousands) Invt Mgt & Trust $ 9,810 $ 10,080 $ (270) -3% Mort. Sales Gains 5,390 4,870 520 11% Overdraft & NSF Fees 4,770 4,670 100 2% Service Charges 3,150 3,370 (220) -7% Cash Mgt Fees 2,700 2,390 310 13% Success Card Fees 1,920 1,730 190 11% Other 9,540 7,270 2,270 __31%
Slide 50: Non-interest income linked quarter
1stQ07 4th Q06 $ % (dollars in thousands) Invt Mgt & Trust $ 9,810 $ 9,470 $ 340 4% Mort. Sales Gains 5,390 5,640 (250) -4% Overdraft & NSF Fees 4,770 5,410 (640) -12% Service Charges 3,150 3,230 (80) -2% Cash Mgt Fees 2,700 2,650 50 2% Success Card Fees 1,920 2,030 (110) -5% Other 9,540 10,010 (470
Slide 51: Efficiency chart FFC versus peer
62.0 58.0 56.0 54.0 52.0 50.0 93 94 95 96 97 98 99 OO Ol O2 03 04 O5 06 307 —*FFC Peer = Top 50 Fulton Financial Corp 51
Slide 52: Non-interest expense year over year
2007 2006 $ % (dollars in thousands) Salaries & Benefits $ 56,290 $ 49,930 $ 6,360 13% Occupancy & Equip. 13,910 12,180 1,730 14% DP/Software/Telecom 6,320 6,110 210 3% Amortization 1,980 1,850 130 7% Other Expenses 22,400 17,950 4.450 25% Total $100,900 $ 88,020 $ 12,880 15% 32
Slide 53: Non-interest expense average comparison
2007 2006 $ % (dollars in thousands) Salaries & Benefits $ 56,290 $ 51,840$ 4450 9% Occupancy & Equip. 13,910 12,620 1,290 10% DP/Software/Telecom 6,320 6,290 30 0% Amortization 1,980 1,850 130 7% Other Expenses 22,400 18,520 3,880 21% Total $_ 100,900 $ 91,120 $ 9,780 11% 33
Slide 54: Non-interest expense linked quarter
1stQ07 4th Q 06 $ % (dollars in thousands) Salaries & Benefits $ 56,290 $ 55,550 $ 740 1% Occupancy & Equip. 13,910 13,100 810 6% DP/Software/Telecom 6,320 6,210 110 2% Amortization 1,980 2,020 (40) -2% Other Expenses 22,400 17,870 4530 25% Total $_ 100,900 $ 94,750 $ 6,150 6% 54
Slide 55: Organic growth in all markets
Organic growth in all markets ™Market segmentation / direct mail capabilities =Small business segment ™New products / remote capture / HSA ™Cash management growth =Non-interest income growth ™Strategy to execution / accountability 58
Slide 56: Fulton Financial Corporation
Fulton Financial Corporation One Penn Square Lancaster, PA 17602 www. fult.com 56