Associated Banc-corp · NYSE:ASB
Associated Banc-corp — Investor Presentation (May 2017)
21 slides from Associated Banc-corp's investor presentation, May 5, 2017
Slide 1: Associated Banc-Corp Investor Presentation Second Quarter 2017
Associated Banc-Corp Investor Presentation SECOND QUARTER 2017
Slide 2: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS Important note regarding forward-looking statements: Statements made in this presentation which are not purely historical are forward-looking statements, as defined in the Private Securities Litigation Reform Act of 1995. This includes any statements regarding management’s
Slide 3: Our Franchise
WI 70% 153 MN 7% 20 IL 23% 42 Deposits (%) And Branches OUR FRANCHISE 2 $29 billion in assets $1 billion revenue2 $20 billion of loans $22 billion of deposits First Quarter 20171 Headquartered in Green Bay, Wisconsin Largest bank headquartered in Wisconsin 1 – As of March 31, 2017, unless otherwise
Slide 4: Attractive Midwest Markets
Manufacturing and Wholesale Trade 27% ATTRACTIVE MIDWEST MARKETS 3.1% 3.4% 3.8% 3.9% 3.9% 4.3% 4.9% 5.1% 5.1% IA WI MN IN MO U.S. IL OH MI Midwest ~30% All other regions ~70% U.S. Manufacturing Jobs 1 – U.S. Census Bureau, Annual Estimates of the Resident Population, 2016 2 – U.S. Bureau of Labor St
Slide 5: First Quarter Update: 2017 Strategic Priorities
FIRST QUARTER UPDATE 4 Strengthening Customer Relationships Delivering on our Strategy Expanding our Community Presence Providing Long- Term Value to Shareholders 2017 Strategic Priorities Balance Sheet Management Mid-to-high single digit annual average loan growth Maintain Loan to Deposit ratio
Slide 6: Positioned for Loan Growth
Net QoQ Growth: +$96 million $1.6 $1.5 $1.5 $1.4 $1.3 $4.6 $4.7 $5.2 $5.9 $6.62 $3.6 $3.9 $4.1 $4.5 $5.0 $5.6 $6.1 $7.0 $7.1 $7.2 1Q 2013 1Q 2014 1Q 2015 1Q 2016 1Q 2017 Commercial & business Commercial real estate Residential mortgage Home equity & Other consumer POSITIONED FOR LOAN GROWTH 5 $20.1
Slide 7: Positioned for Deposit Growth
$2.0 $1.7 $1.6 $1.6 $1.6 $1.1 $1.2 $1.3 $1.4 $1.5 $7.0 $7.2 $8.7 $9.4 $9.2 $2.8 $2.8 $3.2 $3.2 $4.3 $4.2 $4.2 $4.3 $5.0 $5.0 1Q 2013 1Q 2014 1Q 2015 1Q 2016 1Q 2017 Time deposits Savings Money market Interest-bearing demand Noninterest-bearing demand 89% 94% 91% 93% 92% Loan to Deposit Ratio POSITIO
Slide 8: Positioned for Higher Interest Rates: Improving Margin and Asset Sensitive Profile
40% 24% 22% 7% 7% Fast Moving Mixed Slow Moving Money Market Noninterest- bearing demand Interest- bearing demand Savings Time 0.45% 0.39% 0.41% 0.42% 0.52% $12 $12 $13 $14 $17 $10 $8 $8 $8 $10 1Q 2016 2Q 2016 3Q 2016 4Q 2016 1Q 2017 Short and long-term funding costs Interest-bearing deposits $21 2.
Slide 9: Growing and Diversified Business Model
GROWING AND DIVERSIFIED BUSINESS MODEL ($ IN MILLIONS) 8 Strong Insurance Commissions Growth Driven by 2015 Acquisition Robust Capital Markets, Trust and Investments Solutions Noninterest Income $54 $56 $63 $65 $67 1Q 2013 1Q 2014 1Q 2015 1Q 2016 1Q 2017 $83 $74 $80 $83 $80 $12 $12 $20 $21 $22 1Q 20
Slide 10: Increasing Distribution Efficiency
78% 68% 48% 46% 46% 1Q 2013 1Q 2014 1Q 2015 1Q 2016 1Q 2017 9 INCREASING DISTRIBUTION EFFICIENCY LESS BRANCH CENTRIC; MORE MOBILE AND ENHANCED 24/7 ACCESS Almost 60% of customers are active in online banking2 Over 30% of consumer deposit customers use mobile banking 27% increase in SnapDeposit activ
Slide 11: Overall Expense Efficiency
Enhanced Automation Operational Efficiencies Branch Consolidations Branch Staffing Initiatives OVERALL EXPENSE EFFICIENCY AUTOMATION AND INVESTMENTS ARE DRIVING BETTER EFFICIENCY OVER TIME Efficiency Drivers 1 – The efficiency ratio as defined by the Federal Reserve guidance is noninterest expense (
Slide 12: Improving Capital Efficiency
IMPROVING CAPITAL EFFICIENCY 11 149 154 1Q 2016 1Q 2017 Average Common Shares Outstanding Diluted (in millions) 11.64% 11.20% 9.39% 9.30% 9.87% 1Q 2013 1Q 2014 1Q 2015 1Q 2016 1Q 2017 Common Equity Tier 11 Ratio $12.41 $13.00 1Q 2016 1Q 2017 Tangible Book Value per Common Share 4 Funding Organic Gro
Slide 13: Expanding Bottom Line
Earnings Per Share Dividends Shareholder Gain Return on Average Common Equity Tier 11 39% 94% One Year Five Years $0.27 $0.35 1Q 2016 1Q 2017 14% annualized TSR $0.11 $0.12 1Q 2016 1Q 2017 EXPANDING BOTTOM LINE 12 8.6% 10.6% 1Q 2016 1Q 2017 As of March 31, 2017 Exceptional Value 1 – Refer to the app
Slide 14: 2017 Outlook
2017 OUTLOOK Balance Sheet Management Mid-to-high single digit annual average loan growth Maintain Loan to Deposit ratio under 100% Improving NIM trend Improving fee-based revenues Declining mortgage banking revenue Increasing tax credit investment activity Expense Management Approxima
Slide 15: Appendix
APPENDIX
Slide 16: Credit Quality – Quarterly Trends
1Q 2016 2Q 2016 3Q 2016 4Q 2016 1Q 2017 Oil and Gas $4 $2 $(4) $3 $13 $19 $22 $6 $6 1.4% 1.4% 1.4% 1.4% 1.4% 6.5% 5.6% 5.5% 5.7% 6.7% 1Q 2016 2Q 2016 3Q 2016 4Q 2016 1Q 2017 ALLL / Total Loans Oil and Gas ALLL / Oil and Gas Loans CREDIT QUALITY – QUARTERLY TRENDS ($ IN MILLIONS) $251 $281 $270 $276
Slide 17: Loan Portfolio by Geography and Type
C&BL by Geography $7.2 billion CRE by Geography $5.0 billion Multi-Family 29% Retail 24% Office / Mixed Use 20% Industrial 10% 1-4 Family Construction 7% Hotel / Motel 4% Other 6% Manufacturing and Wholesale Trade 27% Power & Utilities 14% Real Estate 11% Oil & Gas 9% Finance & Insurance 8% Other 11
Slide 18: Oil and Gas Update
OIL AND GAS UPDATE $477 $451 $398 $446 $413 $150 $176 $171 $75 $78 $129 $129 $127 $147 $134 1Q 2016 2Q 2016 3Q 2016 4Q 2016 1Q 2017 Pass Potential Problem Loans Nonaccrual $756 $756 $696 $668 $625 Period End Loans by Credit Quality Oil and Gas Allowance $49 $42 $38 $38 $42 6.5% 5.6% 5.5% 5.7% 6.7% 1
Slide 19: High Quality Securities
38% 29% 61% 71% 1% <1% March 2016 March 2017 HIGH QUALITY SECURITIES ($ IN BILLIONS) 18 $4.89 $5.45 $5.75 $6.08 $5.97 2.68% 2.71% 2.58% 2.47% 2.41% 1.00% 2.00% 3.00% 4.00% 5.00% $- $0.01 .$0 2 . .3$0 .4 .$0 5 . .6$0 .7 .$0 8 .9 $0. .1 0$ .1 1.$ 2 .1 .3$ .41 .$ 5 .1 6 .$ .71 $ .8 .1 9$ .2 0 .$ .12 .$
Slide 20: Reconciliation and Definitions of Non-GAAP Items
Tangible Common Equity and Common Equity Tier 1 ($ in millions) 1Q 2013 1Q 2014 1Q 2015 1Q 2016 1Q 2017 Common equity $2,873 $2,840 $2,823 $2,862 $2,985 Goodwill and other intangible assets, net (944) (939) (987) (989) (987) Tangible common equity 1,929 1,901 1,836 1,873 1,998 Less: Accumulated othe
Slide 21: Reconciliation and Definitions of Non-GAAP Items: Efficiency Ratio
RECONCILIATION AND DEFINITIONS OF NON-GAAP ITEMS 20 Efficiency Ratio 1Q 2013 1Q 2014 1Q 2015 1Q 2016 1Q 2017 Federal Reserve efficiency ratio 69.90% 70.46% 70.27% 69.01% 66.39% Fully tax-equivalent adjustment (1.46) (1.35) (1.42) (1.37) (1.30) Other intangible amortization (0.42) (0.42) (0.32) (0.20
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