Central Pacific Financial Corp New · NYSE:CPF
Central Pacific Financial Corp New — Central Pacific Financial — Investor Presentation (March 2023)
23 slides from Central Pacific Financial Corp New's investor presentation, Mar 1, 2023
Slide 1: Investor Presentation March 2023
Investor Presentation March 2023
Slide 2: Forward-Looking Statements
2Central Pacific Financial Corp. Forward-Looking Statements This document may contain forward-looking statements (“FLS”) concerning: projections of revenues, expenses, income or loss, earnings or loss per share, capital expenditures, the payment or nonpayment of dividends, capital position, credit l
Slide 3: Central Pacific Financial - Corporate Profile
3Central Pacific Financial Corp. Central Pacific Financial - Corporate Profile MARKET INFORMATION NYSE TICKER CPF SUBSIDIARY CENTRAL PACIFIC BANK (CPB) TOTAL ASSETS $7.4 BILLION MARKET CAP $625 MILLION SHARE PRICE $23.20 DIVIDEND YIELD 4.5% Central Pacific Financial Corp. is a Hawaii-based bank hold
Slide 4: 4th Quarter 2022 Financial Highlights
44Central Pacific Financial Corp. 4th Quarter 2022 Financial Highlights • Highest quarterly net income and EPS compared to prior 3 quarters • Strong loan growth and deposit growth • Net interest income grew by $0.9 million from the prior quarter • NIM excluding PPP, increased 3 bps sequential quarte
Slide 5: CPF Value Drivers
5Central Pacific Financial Corp. CPF Value Drivers Resilient Hawaii Economic Position Strong & Diverse Loan Portfolio Valuable Deposit Franchise Focus on Driving Efficiency Solid Credit & Capital Profile Digital Initiatives to Expand Future Growth 1 2 3 4 5 6
Slide 6: Resilient Hawaii Economic Position
66Central Pacific Financial Corp. Tourism Visitor arrivals 2022 compared to 2019 92% 1 Employment Unemployment Rate December 2022 3.2% 1 Housing Oahu Median Single- Family Home Price January 2023 $970K 2 FACTORS FOR A FAVORABLE HAWAII OUTLOOK Hawaii economic resilience to weather a recession • Hawai
Slide 7: Total loans grew by $454 Mil or 8.9% in 2022
7Central Pacific Financial Corp. Total loans grew by $454 Mil or 8.9% in 2022 Strong and diverse loan portfolio, with over 75% secured by real estate • Loan market share increased from 13% to 15% in the last 5 years* • Weighted average LTVs of 65% for Residential Mortgage, 61% for Home Equity and 60
Slide 8: Residential Mortgage Strength
8Central Pacific Financial Corp. Residential Mortgage Strength SMALL BUSINESSES HAWAII RESIDENTIAL MARKET • Housing prices continue to be strong with median price of $970K • While demand is slowing, properties continue to move quickly with median days on market at 24 days CPB RESIDENTIAL MORTGAGE LE
Slide 9: Small Business Leader
99Central Pacific Financial Corp. Small Business Leader 2022 SBA HAWAII LENDER OF THE YEAR FOR THE 13TH CONSECUTIVE YEAR Originated more 7a SBA loans based on count and dollar amount than the 3 other large Hawaii banks combined1 Niche Markets • CPB has strong market share in the dental and physician
Slide 10: Valuable Deposit Franchise
10Central Pacific Financial Corp. • Strong deposit portfolio consisting of 90% core deposits and a total deposit cost of 0.41% in the 4Q22 • Total interest-bearing deposit repricing beta 15% in the current Fed tightening cycle 4,000 4,500 5,000 5,500 6,000 6,500 7,000 2016 2017 2018 2019 2020 2021 2
Slide 11: CPF Deposit Cost Advantage
11Central Pacific Financial Corp. CPF Deposit Cost Advantage * U.S. Public banks with total assets of $3-10 billion as of December 31, 2022. Source: S&P Global. 0.00% 1.00% 2.00% 3.00% 4.00% 5.00% 6.00% 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 1Q22 2Q22 3Q
Slide 12: Japan Competitive Advantage
12Central Pacific Financial Corp. Japan Competitive Advantage • Paul Yonamine, CPF Chairman Emeritus, is on the Board of Directors of Sumitomo Mitsui Banking Corporation (SMBC) and Seven & i Holdings. He previously served as the IBM Japan President and led KPMG Consulting in Japan • Hikaru Utsugi, h
Slide 13: Focus on Driving Efficiency
13Central Pacific Financial Corp. Branch Consolidation - 8 branches consolidated since 2020 (-23%) - Currently operating 27 branches in the State of Hawaii - In process of implementing back-office consolidation initiative FTE Initiatives - Reduced total FTE from 810 to 762 over the last 2 years (-6%
Slide 14: Solid Credit & Capital Profile
14 Central Pacific Financial Corp 0.03% 0.03% 0.02% 0.03% 0.03% 4Q21 1Q22 2Q22 3Q22 4Q22 Delinquencies/Total Loans 1.50% 1.53% 1.75% 1.39% 1.39% 4Q21 1Q22 2Q22 3Q22 4Q22 Criticized/Total Loans Solid Credit & Capital Profile5 0.12% 0.10% 0.09% 0.08% 0.09% 4Q21 1Q22 2Q22 3Q22 4Q22 NPAs/Total Loans -0.
Slide 15: Solid Credit Profile to Weather a Recession
15Central Pacific Financial Corp. Solid Credit Profile to Weather a Recession Key Strength Factors: * Data for total mainland consumer loan portfolio, including auto, home improvement and unsecured. Majority of Loans in Hawaii • 83% of total loan portfolio is in Hawaii • Hawaii real estate values ar
Slide 16: Mainland Consumer Portfolio – Managed Risk
16Central Pacific Financial Corp. Mainland Consumer Portfolio – Managed Risk * Seasonally adjusted non-credit card consumer loan charge-off rate for U.S. commercial banks excluding the top 100 largest asset banks. Source: federalreserve.gov Strong Credit Criteria • Purchases adhere to CPF’s strong c
Slide 17: Solid Capital Position
1717Central Pacific Financial Corp. 0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0% 14.0% 16.0% Tier 1 Leverage CET1 Total Capital Regulatory Capital Ratios As of December 31, 2022 Regulatory Minimum Well-Capitalized CPF 13.5% 10.5% Solid Capital Position 8.5% STRONG CAPITAL AND SHAREHOLDER RETURN • Maintained
Slide 18: Digital Initiatives to Expand Future Growth
1818Central Pacific Financial Corp. Shaka - Hawaii’s First Fully Digital Bank Account • Successful launch with over 4,000 accounts opened in the first 6 months • Product expansion and continued development ongoing • Unique brand marketing and social-media strategy • Meeting the needs of younger gene
Slide 19: Mahalo
19Central Pacific Financial Corp. Mahalo
Slide 20: Appendix
20Central Pacific Financial Corp. Appendix
Slide 21: Recognized by Newsweek and Forbes – Best Bank in Hawaii
21Central Pacific Financial Corp. Central Pacific Bank recognized by Newsweek and Forbes – Best Bank in Hawaii* * Newsweek ranked CPB best small bank in Hawaii for 2023. Forbes named CPB best bank in Hawaii for 2022.
Slide 22: Historical Financial Highlights
22Central Pacific Financial Corp (*) Certain amounts in prior years were reclassified to conform to current year's presentation. These reclassifications had an immaterial impact to our previously reported efficiency ratios. Note: Totals may not sum due to rounding. Historical Financial Highlights
Slide 23: Environmental, Social & Governance (ESG) Focus
23Central Pacific Financial Corp. Environmental, Social & Governance (ESG) Focus
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