Wintrust Financial Corporation · NASDAQ:WTFC
Wintrust Financial — FTN Midwest Securities Small and Mid Cap Bank Conference 2006
43 slides from Wintrust Financial's conference presentation, Sep 14, 2006
Slide 1: FTN Midwest Securities Small and Mid Cap Bank Conference
FTN Midwest Securities Small and Mid Cap Bank Conference September 15, 2006 September 15, 2006 September 15, 2006 September 15, 2006 September 15, 2006
Slide 2: Forward-Looking Information
FORWARD-LOOKING INFORMATION During the course of our remarks today, you will hear us make certain predictive statements regarding our plans and strategies and anticipated financial effects to assist you better in understanding our company. These forward looking statements about future results are su
Slide 3: Wintrust Financial Corporation agenda
WINTRUST FINANCIAL C O R P O R A T I O N Asset Quality Who We Are Growth Acquisitions Specialty Asset Classes Wealth Management Financial Review De Novo Growth
Slide 4: Who We Are
Who We Are Approximately fifteen year-old community focused banking organization with approximately $9.2 billion in assets. Fifteen community banks with strong ties to local residents and business leaders in the Chicago and Milwaukee metropolitan markets. 9 charters started since 1991 and 7 acquisit
Slide 5: Who We Are
Who We Are Significant wealth management operation. Provide brokerage, asset management and trust capabilities to our retail and commercial customer bases. Two commercial finance companies which provide loan production to optimize banks' balance sheets and allow us to be asset driven and therefore a
Slide 6: Who We Are - Diversification
Diversification of revenue mix and earning asset portfolio is a major operating tenet Unique asset approach complements our core community banking business, allows for profitable growth and diversifies portfolio risk Focused on growing fee income businesses. We believe we are in excellent markets fo
Slide 7: Who We Are - Strategy
Serve markets in Chicago and Milwaukee areas Have taken advantage of consolidation to grow quickly Position ourselves as the local alternative to the "Big Banks" We know our communities extremely well We promote community banking through personalized service, creative marketing and employee involvem
Slide 8: Who We Are - Marketing Strategy
Go after the big guys - Creative advertising that positions our community banks as the "David" versus the "Goliath" big banks Go after market share - Desire to have No. 1 or 2 market share in short order Focus on household penetration Cross-sell Service, service, service Community involvement and ev
Slide 9: Deposit Market Share
Deposit Market Share De Novo Market Opening Acq. Market Share Bank Date Date Share Rank 1. Lake Forest Bank & Trust 12/91 34.3% 1 (out of 9) 2. Hinsdale Bank & Trust 10/93 21.2% 2 (out of 14) 3. North Shore Community Bank 09/94 31.9% 1 (out of 8) 4. Libertyville Bank & Trust 10/95 42.4% 1 (out of 10
Slide 10: Number of Households
Number of Households Retail and Commercial Banking Customers Q4 1998 Q1 1999 Q2 1999 Q3 1999 Q4 1999 Q1 2000 Q2 2000 Q3 2000 Q4 2000 Q1 2001 Q2 2001 Q3 2001 Q4 2001 Q1 2002 Q3 2002 Q4 2002 Q1 2003 Q2 2003 Q3 2003 Q4 2003 Q1 2004 Q2 2004 Q3 2004 Q4 2004 Q1 2005 Q2 2005 Q3 2005 Q4 2005 Q1 2006 Q2 2006
Slide 11: Deposit Market Share - Chicago MSA
Deposit Market Share-Chicago MSA As of June 30, 2005 In-market Deposit Deposit Market Bank Holding Company Dollars Share % JP Morgan Chase & Co. ** $38.4 BB 16.02% ABN AMRO Holding N.V. ** $31.0 BB 12.92% Bank of Montreal ** $23.3 BB 9.74% Northern Trust Corporation $ 8.5 BB 3.53% Fifth Third Bancor
Slide 12: Who We Are - Management Style
Who We Are - Management Style Local team for each bank that controls a defined territory (managed like a small bank holding company) Decentralized business unit approach where customer interface occurs. Take advantage of operating efficiencies where transparent to the customers. Allows for specific
Slide 13: Who We Are - De Novo Markets
Search criteria for de novo bank locations Demographics Availability of management Bank location No other community bank alternative Who We Are - De Novo Markets
Slide 14: Who We Are - Acquisition Philosophy
Focus on community banks in areas not currently served Within 11/2 hours of Wintrust headquarters Includes Chicago suburbs and SE Wisconsin Focus on entities with existing management that wishes to continue to grow the business Consider non-bank acquisitions in the earning asset and wealth managemen
Slide 15: Have We Abandoned De Novo Growth?
6 of the 7 banks acquired started as de novo banks since 1987. Acquisitions allowed us to move into strategic areas with solid management platforms to support future growth. Our first two bank acquisitions have more than doubled in size since the purchase date in the 4th Qtr. of 2003. 2004/2005 acqu
Slide 16: Branch and planned expansion map
Mlinois. LEGEND > Branch office © Planned Expansion City of chicago
Slide 17: Market Demographics
Lake Forest Bank Lake Forest $247,389 Hinsdale Bank Hinsdale $202,209 North Shore Community Wilmette $171,840 Libertyville Bank Libertyville $131,941 Barrington Bank Barrington $172,480 Crystal Lake Bank Crystal Lake $95,963 Northbrook Bank Northbrook $142,925 Beverly Bank Beverly - Chicago $67,935
Slide 18: Historical Growth
1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 Current Bank and Trust Subsidiaries 2 2 3 4 5 6 7 8 9 10 10 14 16 22 23 25 Banking Offices 1 1 3 5 11 14 17 21 24 28 29 31 36 50 62 72 Historical Growth
Slide 19: Banking Locations
Banking Locations 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 Current Internal 1 1 3 5 11 14 17 21 24 28 29 31 32 40 45 50 Acquisition 4 10 17 22
Slide 20: Asset Growth of Banks by Year
Asset Growth of Banks by Year 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2Q06 Lake Forest 8 49 96 143 195 270 380 441 499 581 667 897 1087 1256 1334 1461 Hinsdale 0 23 67 115 167 223 281 350 401 508 642 746 887 980 1050 North Shore 0 44 105 169 266 294 360 450 563 771
Slide 21: Asset Growth - Internal / Acquired
1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2Q06 7 40 Internal Growth 52 83 189 354 471 706 1053 1348 1650 2074 2676 3619 4450 5399 6456 6994 Acquired Growth 29 29 29 103 297 1020 1721 2179 Asset Growth - Internal / Acquired (in millions) $4,747 $8,177 $3,722 $1,679 $6
Slide 22: Compound Annual Growth Rates
Compound Annual Growth Rates (Years ended December 31, 2005) 1 year 2 year 3 year 4 year 5 year Revenues 27.6% 26.8% 25.0% 31.8% 31.4% Net Income 30.5 32.6 34.0 38.1 43.1 EPS (diluted) 17.5 17.9 19.8 21.3 27.1 Assets 27.4 31.2 30.0 31.9 31.2 Loans 19.9 25.7 26.8 26.8 27.5 Deposits 31.8 31.8 29.6 30.
Slide 23: Earning Asset Strategy
Earning Asset Strategy Desire a Loan-to-deposit ratio of 85%-90% Desired Loan Portfolio allocation: 60-65% Core Loans (Commercial, Real Estate, Retail) 35-40% Niche Loan Portfolios Assists in maintaining sound credit quality (i.e., lenders don't need to stretch for volume) Approach allows us to the
Slide 24: Loans Growth Issues
Loans Growth Issues Average Loan-to-deposit Ratios: 2000 87.7% 2001 87.4% 2002 88.5% 2003 86.4% 2004 87.7% 2005 83.4% 2Q06 (YTD) 80.9% Current year ratio is lower due to: What we deem to be irrational competition on the pricing and underwriting terms being offered in the marketplace Our niche portfo
Slide 25: Commercial Banking Initiative
Commercial Banking Initiative Recently upgraded our suite of treasury and cash management products for commercial customers Will begin to market these commercial capabilities of Wintrust throughout our market area Previously did not promote the Company as one that had strength, size and ability to s
Slide 26: Wealth Management
Trust/Asset Management Dept. of Lake Forest Bank in 1992 Acquired Wayne Hummer Companies in 2002 Acquired Lake Forest Capital Management in 2003 Adding brokers and wealth management staff at the bank locations and expanding at downtown location Wealth Management Assets under admin. of approximately
Slide 27: Financial Overview
Financial Overview
Slide 28: Total Assets
1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2Q06 Crystal Lake 7 40 Total 52 83 189 354 471 706 1053 1348 1679 2103 2705 3722 4747 6419 8177 9173 Barrington 11 72 105 Libertyville 35 76 124 174 North Shore 44 105 169 266 287 Hinsdale 23 67 115 167 223 254 Lake Forest 8
Slide 29: Loan Portfolio Composition
Loan Portfolio Composition As of June 30, 2006 - $6.1 Billion Comm'l Premium Finance Indirect Auto Tricom Other Niches Res. Real Estate Home Equity Other Loan comp 0.6 0.15 0.04 0.01 0.02 0.05 0.11 0.02 Comm'l and Comm'l R/E Premium Finance Indirect Consumer Tricom Res. R/E Home Equity Other Other N
Slide 30: Non-Performing Assets to Total Assets
Non-Performing Assets to Total Assets 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2Q06 Core NPA/TA 0 0.0017 0.0007 0.0016 0.0021 0.0016 0.000676 0.001402 0.0013 0.003 0.0011 0.0019 0.0022 NPA/TA 0.0001 0.0041 0.0025 0.004 0.0045 0.0041 0.0046 0.0048 0.0034 0.0051 0.0029 0.0034 0.0033
Slide 31: Net Charge-offs to Total Loans
Net Charge-offs to Total Loans 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 1H06 Net Charge-offs/Average Loans 0.0018 0.002 0.0031 0.0031 0.0028 0.0019 0.0024 0.0026 0.0024 0.0018 0.0007 0.001 0.001 Total Loans 194 258 493 713 992 1278 1558 2061 2556 3298 4348 5214 6055 Loans In milli
Slide 32: Loan Loss Reserve Analysis
Loan Loss Reserve Analysis Non- Non- Performing Performing Loans, net Loans (%) Core Banking $4,847,603 $17,816 0.37% Indirect Consumer 235,025 327 0.14% Tricom Finance Rec. 36,877 -- 0.00% Premium Finance Rec. 935,635 9,204 0.98% Total $6,055,140 $27,347 0.45% $5,636 2003 Calendar Year Net Charge-o
Slide 33: Consolidated Net Income
Consolidated Net Income (000s) 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2Q05 2Q06 -2236 1497 -973 4846 6245 9427 11155 18439 27875 38118 51334 67016 28652 36624 West 31.6 2606 North 43.9 YTD
Slide 34: EPS Growth
EPS Growth 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 Annual 0.4 0.49 0.73 0.83 1.27 1.6 1.98 2.34 2.75 2.84 Quarterly 0.07 0.09 0.1 0.13 0.08 0.08 0.17 0.16 0.15 0.18 0.2 0.21 0.23 0.24 0.07 0.29 0.29 0.32 0.33 0.33 0.4 0.37 0.4 0.43 0.45 0.49 0.53 0.52 0.54 0.58 0.6 0.62 0.68 0.53 0.8 0.75
Slide 35: Restatement of 2005 Financial Statements
Restatement of 2005 Financial Statements Re: SFAS 133 Interpretations on Debt Swaps The Company restated the 2005 Financial Statements as a result of the evolving interpretations of a complex accounting standard regarding accounting documentation of interest rate swaps. The "short-cut method" of acc
Slide 36: Revenue Growth by Quarter
Revenue Growth by Quarter 1Q97 2Q97 3Q97 4Q97 1Q98 2Q98 3Q98 4Q98 1Q99 2Q99 3Q99 4Q99 1Q00 2Q00 3Q00 4Q00 1Q01 2Q01 3Q01 4Q01 1Q02 2Q02 3Q02 4Q02 1Q03 2Q03 3Q03 4Q03 1Q04 2Q04 3Q04 4Q04 1Q05 2Q05 3Q05 4Q05 1Q06 2Q06 Net Int Inc 5252 6789 7340 7391 8004 8910 9873 9977 10816 11598 12222 13098 13868 14
Slide 37: Net Interest Margin
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2Q05 2Q06 Net Interest Margin 0.0335 0.0296 0.0291 0.0341 0.0343 0.0354 0.0366 0.0349 0.0334 0.032 0.0317 0.0316 0.032 0.0311 Net Interest Margin (fully taxable equivalent) YTD
Slide 38: Net Overhead Ratio & Efficiency Ratio
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 1H06 Net Overhead Ratio 0.0357 0.0201 0.0271 0.026 0.0236 0.02 0.0213 0.0159 0.0141 0.0122 0.013 0.0139 0.0136 Efficiency Ratio 0.8603 0.7975 0.6863 0.7233 0.6366 0.6641 0.6352 0.6445 0.6397 0.6408 Net Overhead Ratio & Efficiency Ratio
Slide 39: Individual Bank Efficiency Ratios - 2005
LFBT NSCBT HBT LBT BBT NBT SBOTL VBT CLBT TOWN ANB WBT BVBT Average Assets 1293013 931318 910691 815447 746926 633273 538222 513636 495832 349110 255810 137546 110824 Efficiency Ratio 0.3966 0.5144 0.4943 0.4635 0.5482 0.5385 0.6093 0.634 0.506 0.4971 0.6552 1.1233 0.8493 Individual Bank Efficiency
Slide 40: Financial Overview - Capital Components
1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 1H06 Capital Growth 14583 11291 17227 25366 40487 42620 68790 75205 92947 102276 141278 227002 349837 473912 627911 721803 31050 31050 51050 51050 50894 96050 204489 230458 230375 25000 50000 50000 50000 83000 Financial Overv
Slide 41: Financial Overview - Book Value Per Share
Financial Overview - Book Value Per Share 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 1H06 BV per share 5.65 6.15 7.06 7.92 9.72 13.19 17.43 21.81 26.23 28.17
Slide 42: Insider Ownership
Insider Ownership Director and executive officers beneficially own 7.5% of the Company (based on 4/06 proxy disclosure) Management and directors interests are aligned closely with those of shareholders
Slide 43: Questions
Questions
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