First Citizens Bancshares, Inc. · NASDAQ:FCNCA

First Citizens Bancshares — Investor Presentation (May 2025)

31 slides from First Citizens Bancshares's investor presentation, May 21, 2025

  1. Slide 1: Monthly Market Update

    Phillip Neuhart, SVP Director of Market and Economic Research Monthly Market Update Blake Taylor, VP Market and Economic Research Analyst Recorded on May 21, 2025

  2. Slide 2: What are we going to cover?

    What are we going to cover? 1. Economic Update: Tariff Update | Growth Outlook | Inflation & Labor Market | Consumer Spending | Fed Policy 2. Market Update: Equity Markets | Valuations | Fixed Income

  3. Slide 3: Economic & Policy Update

    Economic & Policy Update Tariff Update | Growth Outlook | Inflation & Labor Market | Consumer Spending | Fed Policy

  4. Slide 4: Even After Substantial Easing, Tariffs Are Still the Highest Since World War II

    Even After Substantial Easing, Tariffs Are Still the Highest Since World War II US Average Tariff Rate 70% 60% 50% 40% 30% April 9 - May 11 21% 20% As of May 12 11% 10% 0% 1790 1815 1840 1865 1890 1915 1940 1965 1990 2015 Source: Bloomberg Intelligence 4

  5. Slide 5: The US Has Suspended Half of New Tariffs, but Others Are in the Works

    The US Has Suspended Half of New Tariffs, but Others Are in the Works Contribution to US Effective Tariff Rate With proposed "reciprocal" 90-day tariffs and re-escalation of Reduction in China tariffs: 30% China tariffs 30% 25% 20% Effective tariff rate with pending sector tariffs: 16% 15% 90-day 25

  6. Slide 6: Importers Are Already Paying Billions More in Fees at the Border

    Importers Are Already Paying Billions More in Fees at the Border Customs Duties Tariffs paid on Billions of dollars, monthly goods imported in 20 March 2025: $17.4 billion 18 16 14 12 10 8 6 4 2 0 2005 2010 2015 2020 2025 Source: Treasury Department, Bloomberg 6

  7. Slide 7: Current Expectations Show Global Growth Slowing but Not Stalling

    Current Expectations Show Global Growth Slowing but Not Stalling World Economic Outlook Consensus Real Economic Growth Estimates 2024 2025 Estimate as of: Actual Growth Dec. 2024 Today World 3.2% 3.0% -0.4% 2.6% United States 2.8% 2.1% -0.7% 1.4% Euro Area 0.9% 1.0% -0.2% 0.8% Canada 1.5% 1.8% -0.6%

  8. Slide 8: Economic Forecasts Have Turned Slightly More Pessimistic

    Economic Forecasts Have Turned Slightly More Pessimistic Economic Projections Median Professional Consensus 5.0% 4.6 January 1 Today 4.5% 4.3 4.0% 3.5 3.5% 3.0% 2.5 2.5% 1.9 2.0 2.0% 1.6 1.5% 1.3 1.1 0.9 0.9 1.0% 0.4 0.5% 0.0% GDP Consumer Industrial Nonfarm CPI Inflation Unemployment spending produ

  9. Slide 9: As Tariffs Set In, Inflation Was Tracking Modestly Above the Fed's 2% Target

    As Tariffs Set In, Inflation Was Tracking Modestly Above the Fed’s 2% Target Average Annualized Inflation Rates Overweighting Data From Recent Months 12% PCE Core PCE 10% CPI Core CPI Fed's 2% target 8% 6% 4% 2% 0% -2% 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 Source: Labor Department,

  10. Slide 10: Surveys Suggest Businesses Are Already Paying Up for Input Costs

    Surveys Suggest Businesses Are Already Paying Up for Input Costs Businesses Reporting Higher Input Prices According to Federal Reserve Surveys 80 Net percent, change from 12/31/2024 60 40 20 0 -20 Dallas (Manufacturing) Dallas (Retail) -40 Dallas (Services) New York (Manufacturing) Philadelphia (Man

  11. Slide 11: Markets Have Modest Expectations for Rate Cuts Starting Later This Year

    Markets Have Modest Expectations for Rate Cuts Starting Later This Year Federal Funds Rate and Market-Implied Path Federal funds rate 6% Latest market pricing 5% Today: 4.4% 4% 1 # of 2 cuts 3 4 3% 2% 1% 0% 2020 2021 2022 2023 2024 2025 2026 Source: Bloomberg, First Citizens Wealth. Data as 5/19/202

  12. Slide 12: Job Growth Has Been Fairly Healthy in Recent Months

    Job Growth Has Been Fairly Healthy in Recent Months 800 Payroll Job Growth Thousands, three-month moving average 700 600 500 400 300 Estimated "breakeven" rate of job growth 200 100 0 Feb '21 Aug '21 Feb '22 Aug '22 Feb '23 Aug '23 Feb '24 Aug '24 Feb '25 Source: Department of Labor, Bloomberg. Data

  13. Slide 13: Consumer Expenditures Are Holding Up, Still Led by Services Spending

    Consumer Expenditures Are Holding Up, Still Led by Services Spending Personal Consumption Expenditures 50% Percent change, year-over-year 40% Services 20-year average: Goods Services: 4.9% 30% Goods: 4.1% 20% 10% +6.3% 0% +4.1% -10% -20% 2018 2019 2020 2021 2022 2023 2024 2025 Source: Department of

  14. Slide 14: Household Expectations Are Close to the Lowest Level on Record

    Household Expectations Are Close to the Lowest Level on Record University of Michigan: Index of Households' Expectations 120 110 100 90 80 70 60 50 40 1979 1981 1983 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 2017 2019 2021 2023 2025 Source: Bloomberg, University

  15. Slide 15: Household Inflation Expectations Have Surged

    Household Inflation Expectations Have Surged Inflation Expectations, Next Five Years Household expectations, next 5 years 8 Household expectations, next year 7 6 5 4 3 2 1 0 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 Source: Bloomberg, University of Michigan. Data through May 2025. 15

  16. Slide 16: Housing Affordability Remains at Historic Lows

    Housing Affordability Remains at Historic Lows Housing Affordability Index Household income relative to income required to quality for conventional loan 250 Median homebuyer Median renter, first-time homebuyer 200 150 100 50 0 1986 1989 1992 1995 1998 2001 2004 2007 2010 2013 2016 2019 2022 2025 Sou

  17. Slide 17: Household Finances Are Growing More Strained

    Household Finances Are Growing More Strained Delinquency Rates Percent of Total Loans Outstanding in Accounts 90+ Days Delinquent Credit card Loans (left axis) 15% Auto loans (right axis) 5.5% 14% 5.0% 13% 4.5% 12% 4.0% 11% 3.5% 10% 3.0% 9% 2.5% 8% 7% 2.0% 6% 1.5% 2003 2005 2007 2009 2011 2013 2015

  18. Slide 18: Market Update

    Market Update Equity Markets | Valuations | Fixed Income

  19. Slide 19: Global Asset Prices Have Recovered After the April Selloff

    Global Asset Prices Have Recovered After the April Selloff Total Market Returns As of 5/20/2025 Since Since YTD April 2 Feb. 19 peak 2025 US Equities +5.0% -3.3% +1.2% Intl. Developed +8.0% +8.1% +16.6% Equities Emerging Market +5.5% +3.6% +9.7% Equities Aggregate Fixed -1.1% +1.0% +1.8% Income Muni

  20. Slide 20: The S&P 500 Has Staged a Terrific Rebound

    The S&P 500 Has Staged a Terrific Rebound S&P 500 Index 6500 -3% 6000 5500 -8% 5000 -5% -19% 4500 4000 -10% Total return since 10/12/2022: +73% -25% 3500 Jan '22 May '22 Sep '22 Jan '23 May '23 Sep '23 Jan '24 May '24 Sep '24 Jan '25 May '25 Source: Bloomberg. Data as of May 19, 2025. 20

  21. Slide 21: The Tariff Selloff Was Intense, but the Rebound Was Even Sharper

    The Tariff Selloff Was Intense, but the Rebound Was Even Sharper S&P 500 Index vs One Month Ago 30 22-day percent change 8,912 trading days since January 1, 1990 May 12, 2025: +17.3% 20 16th-highest 1-month gain since 1990 10 0 0 500 1000 1500 2000 2500 3000 3500 4000 4500 5000 5500 6000 6500 7000 7

  22. Slide 22: S&P 500 Valuations Have Contracted Modestly

    S&P 500 Valuations Have Contracted Modestly S&P 500 Next Twelve Months Price-to-Earnings Ratio 28X 24X 20X +1 Standard Deviation 16X Average 12X -1 Standard Deviation 8X 1989 1992 1995 1998 2001 2004 2007 2010 2013 2016 2019 2022 2025 Source: Strategas. Data as of 5/15/2025. 22

  23. Slide 23: Multiples for the Top 10 Largest Equities Have Moved Down

    Multiples for the Top 10 Largest Equities Have Moved Down Cap. Weighted Price-to-Forward Earnings Top 10 45x Top 11-500 40x 35x 30x 25x 20x 15x 10x 5x 2000 2004 2008 2012 2016 2020 2024 Source: Trivariate Research. Data as of 5/15/2025. 23

  24. Slide 24: Corporate Earnings

    Corporate Earnings  2025 estimated growth is 9.0% 19% Estimated Next 12-Month S&P 500 Operating Margin  Q1 2025 estimated growth was 13.6% 18% 17% 17.6%  2026 estimated growth is 13.4% 16% 15%  Average growth since 1950 is 7.6% 14% 13% 2012 2014 2016 2018 2020 2022 2024 Source: FactSet, Bloomber

  25. Slide 25: S&P 500 Price Target

    S&P 500 Price Target Next Twelve Month S&P 500 Price Target Percent Next Twelve Months Change from Price Level 5/20/2025 Bear 4,600 -22.6% Base 6,300 6.1% Bull 6,900 16.2% Source: Bloomberg, FactSet, First Citizens Wealth. 25

  26. Slide 26: Bond Spreads Show Risk Levels Are Low for Corporate Borrowers

    Bond Spreads Show Risk Levels Are Low for Corporate Borrowers US Fixed Income 1,200 Option Adjusted Spreads in Basis Points High yield spread 1,000 Investment grade spread 800 600 400 200 0 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 Source: Bloomberg. Data as of 5/19/2025. 26

  27. Slide 27: The Treasury Yield Curve Has Steepened This Year

    The Treasury Yield Curve Has Steepened This Year US Treasury Yield Curve 5.0% 4.9% 4.9% 4.8% 4.9% 4.8% 4.6% 4.6% 4.5% 4.4% 4.3% 4.4% 4.3% 4.4% 4.3% 4.2% 4.3% 4.2% 4.3% 4.3% As of 4.0% 4.1% Latest date - May 19 4.0% Dec. 31, 2024 4.0% 3.8% 1 3 6 1 2 3 5 7 10 20 30 MM M Yr Yr Yr Yr Yr Yr Yr Yr Source:

  28. Slide 28: Fixed Income Is Still Offering Attractive Yield

    Fixed Income Is Still Offering Attractive Yield US Fixed Income Indices Yield-to-Worst Index As of 5/19/2025 As of 12/31/2024 2-Year Treasury 4.0% 4.2% 10-Year Treasury 4.4% 4.6% Aggregate Bond 4.8% 4.9% Intermediate Government/Credit 4.4% 4.6% Municipal Bond 4.1% 3.7% Investment Grade Corporate Bon

  29. Slide 29: Market Timing Is a Dangerous Game

    Market Timing Is a Dangerous Game Growth of $10,000, S&P 500 Compounded Total Returns, 1995 - 2024 $140,000 $131,347 37% less 54% less 73% less 83% less 89% less 92% less $120,000 • Nearly half (48%) of the S&P $100,000 500 Index’s strongest days $83,010 occurred during a bear $80,000 market. $60,23

  30. Slide 30: Market & Economic Research

    Market & Economic Research Brent Ciliano, SVP Chief Investment Officer In Brief | A look at the week ahead in under two minutes every Monday morning Phillip Neuhart, SVP Q&A Videos | Monthly conversations covering 2-3 of the top Director of Market and questions we’re hearing from clients Economic Re

  31. Slide 31: Authors and Important Disclosures

    Authors Important Disclosures This material is for informational purposes only and is not intended to be an offer, specific investment strategy, Brent Ciliano, CFA | SVP, Chief Investment Officer recommendation, or solicitation to purchase or sell any security or insurance product, and should not be

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