Provident Financial Holdings, Inc. · NASDAQ:PROV
Provident Financial — Q4 2008 Earnings Presentation
45 slides from Provident Financial's earnings presentation, Jan 29, 2009
Slide 1: Provident Financial Holdings, Inc. December 31, 2008
f PROVIDENT fh. Provident Financial Holdings, Inc. December 31, 2008 www.myprovident.com
Slide 2: Safe-Harbor Statement
Safe-Harbor Statement This presentation contains statements that the Corporation believes are “forward-looking statements." These statements relate to the Corporation's financial condition, results of operations, plans, objectives, future perfarmance ar business. You should not place undue reliance
Slide 3: Market Highlights
~~ wt PROV/DENTZ23. Provident Financial Holdings, Inc. Market Highlights Nasdaq GS: PROV 52-week range: $4.00 - $18.40 Shares outstandin 6,208,519 shares P/E (ttm): Annual div & yield: $0.20 (4.42%) _ Div record date: 21-Nov-08 As of December 31, 2008
Slide 4: Organizational Chart
PROVIDENT a. Provident Financial Holdings, Inc. 4 Organizational Chart
Slide 5: PROV Overview
PROVIDENT a. Provident Financial Holdings, Inc. ft PROV Overview Regional Banking Services Company Based in the Inland Empire Region of Southern California ¢ Expanding customer base and market « Strong mortgage operations ¢ Largest independent community bank headquartered in Riverside County, Califo
Slide 6: Provident Locations
+ Pleasanton, Northern California San Luis onan NS a PROV/DENTZ23. Provident Financial Holdings, Inc. Provident Locations Provident Bank Full Service Offices: Xa HB BE BP Xb Xb Xb Yb HO DD Blythe Canyon Crest, Riverside Corona Corporate Office, Riverside Downtown, Riverside Hemet La Sierra, Riversid
Slide 7: PROV Highlights
PROVIDENT fs Provident Financial Holdings, Inc. PROV Highlights Total Assets . Loans Held for Investment . $ 1.27 Billion $ 1.37 Billion Deposits $ 934.8 Million $ 1.01 Billion Equity $ 117.9 Million $ 126.0 Million Tangible Equity $117.9 Million $126.0 Million $ 1.61 Billion $ 1.55 Billion Net (Los
Slide 8: Total Assets
81 $1 81 $1 81 81 81 81 81 800 700 600 500 400 300 200 100 ooo PROV/DENTZ23. Provident Financial Holdings, Inc. Total Assets $1,674 9/07 12007 03/08 06/08 ag08 12008 (Quarter Ended)
Slide 9: Quarterly Net Income
Quarterly Net Income (In Millions) $10 $1.0 $1.0 7 506 503 5. §(1.0) 4 §(2.0) 4 §(1.8) $3.0) 4 §(4.0) 4 §6.0)4 $6.0) 4 §(7.0)4 5(6.5) $6.0) asn7 12007 038 o6Ms asa8 12/08 (Quarter Ended)
Slide 10: Pre-Tax Income - Operating Segments
PROVIDENT a. Provident Financial Holdings, Inc. Pre-Tax Income - Operating Segments (In Millions) $6.07 $4.04 $205 $0.0 $2.04 “$407 $6.04 $8.04 $10.04 $12.0 09/07 12007 0308 o608 ag08 12/08 (Quarter Ended) [Community Banking HM Mortgage Banking]
Slide 11: Quarterly Net Interest Income
(In Millions) $12.0 4 $11.0 $10.0 $9.0 4 $8.0 4 s7.0 4 $6.0 4 Quarterly Net Interest Income $11.8 09/07 12007 0308 06/08 a9/08 12/08 (Quarter Ended) 10
Slide 12: Non-Interest Income
PROV/DENTZ23. Provident Financial Holdings, Inc. Non-Interest Income (In Millions) $2.6 7 $2.0 4 §(0.5) aga7 12007 age ase a908 12008 (Quarter Ended) [Gain (Loss) on Sale of Loans MlOther Fees] 1
Slide 13: Net Interest Margin
Net Interest Margin | 2.93% 2.75% 4 2.50% 4 2.25% +4 2.00% 4 03/07 1207 03/08 sos a908 1208 (Quarter Ended) 12
Slide 14: Net Interest Margin vs. Fed Funds
PROVIDENT: Provident Financial Holdings, Inc. Net Interest Margin vs. Fed Funds 6.00% 5.50% 5.00% 4.50% 4.00% 3.50% 3.00% 2.50% 2.00% 1.50% 1.00% 0.50% % 0.00% 12106 oor | aeio7 agar 42007 03/08 08/08 08 42108 ==NiM_ 250% | 249% | 237% [240% [242% | 269% | 293% [280% [ 270% GeredFunds (%) | 525% | 5
Slide 15: Operating Expenses
PROV/DENTZ23. Provident Financial Holdings, Inc. Operating Expenses (In Millions) ii $8.07 §7.07 $6 $5 $4 $3 $2.07 $1.04 $0.04 as7 1207 0308 o608 a908 1208 (Quarter Ended) 14
Slide 16: G&A to Average Assets
G&A to Average Assets 2.50% 4 2.28% 4 195% 2.00% + 1.75% 4 1.60% 4 1.25% F 1.00% 4 9/07 12007 0308 06/08 aga8 12008 (Quarter Ended) 15
Slide 17: Efficiency Ratio
Efficiency Ratio 75.00% 70.00% 4 65.00% 4 60.00% 4 55.00% 4 50.00% 4 45.00% 4 40.00% 4 PROV/DENTZ23. Provident Financial Holdings, Inc. 72.27% 09/07 improving 65.70% Ba57% 59.23% 57 81% 53.48% 12107 0308 o608 (Quarter Ended) 0908 1208 16
Slide 18: Return on Average Assets
Return on Average Assets 050% 026% 0.23% 025% 4 715% _J CI cua% 0.00% 025% 4 050% 4 “0.43% 075% 4 100% 4 125% 4 150% 4 175% 4 “187% 2.00% a9n7 12007 03/08 06 /08 age 12/08 (Quarter Ended) 17
Slide 19: Return on Average Equity
Return on Average Equity 5.00% 3.30% 2.99% — =a a 0.00% -6.00% 4 5.55% “10.00% 4 “15.00% 4 -20.00% 4 -21.44% -25.00% ag/o7 12107 03/08 os/o8 age 1208 (Quarter Ended) 18
Slide 20: Diluted Earnings per Share
Diluted Earnings per Share §0.25 4 $0.17 $0.15 $0.10 | | $005 8 §(0.25)4 ‘J §(0.28) §(0.50) 4 §(0.75)4 §(1.00)4 §(1.05) §(1.25) 9/07 12007 0308 0608 0308 12/08 (Quarter Ended) 19
Slide 21: Book Value per Share
PROW/DENT #25. Provident Financial Holdings, Inc. Book Value per Share $25.00 4 $24.00 4 $23.00 + $22.00 + 21.00 + $ $20.21 $20.38 $20.49 $19.97 $20.05 $20.00 + $19.00 4 $18.00 + $17.00 + $16.00 + $15.00 4 09/07 12/07 03/08 608 ag/08 12/08 (Quarter Ended) 20
Slide 22: Community Banking
> << » Vv PROW/DEWT 3. Provident Financial Holdings, Inc. | Community Banking ti > ow PROVIDENT *av, Bank AVAVAMA.... More for you everyday. 21
Slide 23: Loan to Investment Mix
PROVIDENT #2. Loan to Investment Mix (In Millions) §16007 §14004 §1.2004 $1 0004 $8004 $6004 $4005 $2004 sot ogn7 1207 0308 o6/08 age 12/08 [iCoans Held for Investment MiInvestment Securities | 22
Slide 24: Provident Bank Loan Originations
» “A ss PROW/DENT 3. Provident Bank Loan Originations Provident Financial Holdings, Inc. (Primarily “Preferred Loans”) (In Millions) 8707 $60 §62 $605 $504 $407] $36 $307] $207] §9 sia $6 $4 sot 0907 12107 0308 508 ogme 12/08 (Quarter Ended) 23
Slide 25: Loan Portfolio Mix
PROVIDENT a. Loan Portfolio Mix Provident Financial Holdings, Inc. (Loans Held for Investment) s1o00 100% 000 aoe gs20 get 9027 Te geno e0% g700 70% 600 eoe e = 9500 50% $400 40% 300 20% 200 20% gip0 10% so oe pan? 12007 ame o6i08 pome 12me [Bee referred Loans BEES ing «Family Loans “=A of Preferred
Slide 26: Asset Quality: Non-Performing Assets
PROVIDENT. ident Financial Holdings, Inc. Asset Quality Non-Performing Assets ("NPA") & NPA to Total Assets 0,000 600% 000 550% 0000 500% 6000 2. 0000 Are 000 aot = g 8 © se0.000 300% © 3 g E 250m anor ® 20000 200% 16000 seo 10.000 _ 6.000 oso 00% 2 1208 [Stn Farirnhg Rosas | e007 wa Brae wa was Tea
Slide 27: Asset Quality: Provision for Loan Losses
PROV/DENTZ23. Provident Financial Holdings, Inc. Asset Quality Provision for Loan Losses (PLL) & Allowance for Loan Losses to Loans Held for Investment (ALL to LHI) 17.000 700% 16.000 “a, 18.000 cso 14.000 tao 19.000 30% 12,000 200% 11.000 100% = 0.000 too0% a a § 000 coor £ 2 s.o00 sox f v.00 700%
Slide 28: Asset Quality: Single-Family Loans Held for Investment
Asset Quality Single-Family (1st) — Loans Held for Investment PROV/DENTZ23. ~ I Provident Financial Holdings, Inc. Year of Origination 2000 &Prior | 2001_| 2002_| 2003 | 2001 | 2005 | 2006 | 207_| mos _| TOTAL Loan Balance (InThousands) [$ 12682] 150 $ 3972| $ 27682] $ 99684] § 234830] § 192,445] $1
Slide 29: Asset Quality: Geographic Locations
Asset Quality Geographic Locations PROVIDENT: Provident Financial Holdings, Inc. Inland Southern Other Other Loan Category Empire California (1) California States Total Single-Family 31% 5A% 14% 1% 100% Multi-F amily 9% 70% 19% 2% 100% Commercial Real Estate 47% 50% 2% 1% 100% Construction 97% 3% 0%
Slide 30: Transaction Accounts, CDs & Borrowings
Transaction Accounts, CDs & Borrowings (n Millions) $1,600 $1.400-+—7 $1,200-+-—~7 $1,000 4 seoo-+—7 seo0-+—7 s4o0-+—7 g200-+-—7 so agar 42007 03/08 o608 ogg 42/08 (Quarter Ended) [BTransaction Accounts @CDs OBarrowings 29
Slide 31: Deposit Composition
SJ PROV/DENTZ23. Provident Financial Holdings, Inc. Deposit Composition seis As of 12/31/2008 ne} tn co's Savings Interest Non-interest Money Market cheeking Checking As of 09/30/2007 2} (in ma Interest Money Market biking
Slide 32: Mortgage Banking
PROVIDENT 5 | Mortgage Banking _ ta dp ov PROV/DENT %sv, Bank Mortgage AV AVAVA..., Faster funded home loans. 31
Slide 33: Provident Bank Mortgage Loan Originations
3 << » Vv PROW/DEWT 3. Provident Financial Holdings, Inc. Provident Bank Mortgage Loan Originations (In Millions) $1807 $1607 $1407 $1204 $1007 $804 $604 $404 $204 so as/07 12007 0308 06/08 03/08 12/08 (Quarter Ended) aleable Portfolio 32
Slide 34: Provident Bank Mortgage Locked Pipeline
PROVIDENT: Provident Financial Holdings, Inc. Provident Bank Mortgage Locked Pipeline Locked Pipeline - Available for Sale (In Thousands) $80,000 4 east $70,000 4 2 gan’ $60,000 4 $50,000 4 $40,000 4 $30,000 4 $20,000 4 $10,000 4 $(0) 09/07 12/07 038 o6/08 0908 12/08 ™@Gross Locked Pipeline $35 670
Slide 35: PBM Purchase vs. Refinance
SJ PROV/DENTZ23. Provident Financial Holdings, Inc. PBM Purchase vs. Refinance 20% 10% 0% 09/07 42107 03/08 06/08 ogi08 42108 Refinance 81% 59% 64% 34% 17% 17%, Purchase 39% 41% 36% 66% 83% 83%, (Quarter Ended) 34
Slide 36: Loan Sale Margin
PROVIDENT a. Provident Financial Holdings, Inc. Loan Sale Margin 1.90% 140% 0.90% 0.40% 0.10% -0.60% pepound solid 0.32% 09:07 12/07 03/08 06/08 age 1208 (Quarter Ended) MLoan Sale Margin MLoan Sale Margin, Excluding Recourse Provision | 35
Slide 37: Capital Management
PROVIDENT a. ft Provident Financial Holdings, Inc. Capital Management 36
Slide 38: Stockholders' Equity
PROV/DENTZ23. Provident Financial Holdings, Inc. Stockholders’ Equity (In Millions) $130 5 $125 §120 $115 $110 $105 $100 asn7 12007 03/08 ass 09/08 1208 (Quarter Ended) 37
Slide 39: Share Repurchase Program
Share Repurchase Program @ of Shares) PROVIDENT a. Provident Financial Holdings, Inc. 09/07 1207 03/08 06 08 0908 12/08 Shares Repurchased 150,712 36,369 a a a a [Average Cost perShare| $22.40 $19.24 $0.00 $0.00 $0.00 $0.00 (Quarter Ended) 38
Slide 40: Cash Dividend per Share
Cash Dividend per Share $0.18 $0.18 $0.18 oor 42107 03/8 orog 09/08 12108 (Quarter Ended) 39
Slide 41: Consolidated Capital Ratio
Consolidated Capital Ratio Equity to Assets 7.84% ag07 12007 03/08 0608 a908 12/08 (Quarter Ended)
Slide 42: Bank Capital Ratio
Bank Capital Ratio Tier 1 Core Capital Ratio 10.00% 7 9.00% 4 8.00% 4 7.42% 7.25% ag/07 12007 0308 06/08 9/08 12108 (Quarter Ended) 41
Slide 43: Value Proposition
PROVIDENT: Provident Financial Holdings, Inc. Value Proposition Stock Price to Tangible Book Value Multiple 1.80 1.60« 1.40« 1.20% 1.00% 80x ae 60x ADx 20% 00x IMar Jun Sep Dec Mar [Jun Sep Dec 2007 2007 2007 2007 2008 2008 2008 2008 Ee =Pricetav | 1.37% 124x 110% six a78x 47x O.4ax 0.24% 42
Slide 44: Stock Performance
Stock Performance PROV/DENTZ23. ~ I Provident Financial Holdings, Inc. $110 $100 = Be $90 $80 Sa $70 Ss $60 ~ SS $50 -— $40 $30 $20 =e $10 Ton Sep Dec Mar [lun Sep Dec 2007 2007 2007 2008 2008 2008 2008 [Prov $100 $90 $67 $66 §39 §37 $19 [-m-Nasday Bankindex | $100 $95 $64 579 $62 574 561 [=Nasdan S
Slide 45: PROVIDENT ifs
PROVIDENT ifs Provident Financial Holdings, Inc. PROV NASDAQ LisTteonb www.myprovident.com
Provident Financial Holdings — Q4 2008 Earnings Presentation on 6ix