Community Trust Bancorp, Inc. · NASDAQ:CTBI
Community Trust Bancorp — Shareholder Meeting (April 2008)
45 slides from Community Trust Bancorp's shareholder meeting presentation, Apr 22, 2008
Slide 1: Community Trust Bancorp 2008 Annual Shareholders Meeting
ZZ Community Trust Bancorp, Inc. 2008 Annual Shareholders Mee ting April 22, 2008
Slide 2: Cautionary Statement
CAUTIONARY STATEMENT Information provided herein by the Corporation contains “forward-looking” information. The Corporation cautions that any forward-looking statements made by the Corporation are not guarantees of future performance and that actual results may differ materially from those in the fo
Slide 3: Our Banking Franchise
Our Banking Franchise 2 Community Trust Bank Branch Office 2 Community Trust & Investment Office Serving 77 branch locations in 33 counties throughout Kentucky and West Virginia
Slide 4: 2007 Operational Challenges
2007 Operational Challenges a 2007 a Changes in the economy > Increased oil prices > Subprime lending crisis > Changes in the investment markets > Devaluation of the dollar > Fear of inflation > Decline in stock prices » Weak consumer confidence > Decrease in consumer spending a 2008 Q Operational c
Slide 5: 2007 Performance
2007 Performance
Slide 6: Strategic Plan for 2007
Strategic Plan for 2007 What were our goals? a A6% to 8% increase in earnings and EPS = Loan and deposit growth of 8.5% and 3% = Noninterest income of 1.20% = Noninterest expense of 2.90% = Efficiency ratio of 56% = Improving asset quality = Increasing shareholder value = Expanding our banking franc
Slide 7: 2007 Performance Summary
2007 Performance Summary What were the results of executing our plan? = Earnings of $36.6 million, a 6.2% decrease a EPS of $2.42, a 6.6% decrease = Loan growth of 2.8% = Deposits decrease of 2.1% = Noninterest income of 1.23% = Noninterest expense of 2.79% = Efficiency ratio increased to 57.62% = N
Slide 8: Expanding Our Franchise
Expanding Our Franchise = Expansion through new branches > Branch Relocation in Frankfort, KY in 4Q 2007 >» New branch in Huntington, WV opened April 2, 2008
Slide 9: Shareholder Value
Shareholder Value
Slide 10: Dividends Per Share
Dividends Per Share $1.16 2003 2004 2005 2006 2007 2008* *2008 is projected DPS
Slide 11: Dividends Per Share: Consecutive Years of Increases
Dividends Per Share 27 consecutive years of increased cash dividends 11.1% compound growth rate for past five years Increased dividend by 2¢ (7.41%) effective with the January 2008 dividend 2007 cash dividends increased 4.8% December 31, 2007 cash dividend yield 4.21%
Slide 12: Shareholders' Equity
Shareholders’ Fguity = Shareholders’ equity has increased 36.1% during the past five years = 7.6% compound growth rate for the past five years = 2008 shareholders’ equity projected at $317 - $319 million
Slide 13: Total Market Capitalization
Total Market Capitalization Gin millions) $629.5 2003 2004 2005 2006 2007 2008 All data is as of year-end except 2008 which is based upon stock price on March 31, 2008
Slide 14: Comparison of Cumulative Total Return
Comparison of 5 Year Cumulative Total Return among CIBI, NASDAQ Stock Market (US), and NASDAQ Bank Stocks $300 .. VE ———— $100 2002 2003, ann 2005 2006 2007 Community Trust Bancorp, Ine. NASDAQ Stock Market (U'S.) —*—NASDAQ Bank Stocks An investment in CTBI stock on December 31, 2002 would have outp
Slide 15: Comparison to Russell 2000 Index
Comparison to Russell 2000 Index Olomalleancompdnred Return to Investors December 31, 2007 16.28% 6.84% 99-14% 7.AT% TAT% -31.20% 1-Year 3-Year 5-Year 10-Year g=CTBI Russell 2000 © 3-,5-, and 10-year total returns annualized
Slide 16: Historical Investment Return
Historical Investment Return Core value long term investment Formation of bank holding company in 1981 12 stock splits 9 stock dividends 27 years of consecutive increases in cash dividends > $0.02 per share increase effective December 15, 2007 3-year compound growth rate of cash dividends 11.1% Stoc
Slide 17: 2007 Earnings Review
2007 Earnings Review
Slide 18: Earnings Per Share
Earnings Per Share $2.59 $2.31 is 2003 2004 2005 2006 2007 = Earnings per share decreased 6.2% in 2007 =m 5.7% 5-year compound growth rate for EPS = 2008 EPS projected at $2.25 to $2.45 per share
Slide 19: Net Income
Net Income (in millions) $39.1 2003 2004 2005 2006 2007 = 2008 projected net income $34 million to $36 million
Slide 20: Net Income
Net Income Increase in provision for loan losses of $2.2 million year over year $1.9 million pre-tax charge from unamortized debt issuance costs related to redemption of trust preferred securities $1.2 million fee earned related to the termination of the acquisition of Eagle Fidelity, Inc. Reversal
Slide 21: Revenues
Revenues 2003 2004 2005 2006 2007 @ 4.0% compound growth rate for revenues for the past five years > 2007 revenues increased 1.6% @ 2008 projected revenues of $144 million to $148 million
Slide 22: Noninterest Income
Noninterest Income as a %of Total Revenue (Gin millions) =e, Se = $33.9 $33.5 eean _..| Ll |__| — _— | | = 2003 2004 2005 2006 a. [=‘Noninterest Income ——% of Total Revenue ie @ 2007 noninterest income >» Increase in deposit fees >» Change in mortgage loan activity > Stable brokerage revenue > Incre
Slide 23: Net Interest Revenue
Net Interest Revenue (in millions) $103.2 %197.8 $106.0 se4g 993.2 2003 2004. 2005 2006 2007 @ 2007 decrease in net interest revenue was 1.6% > Interest income increased 4.0% » Interest expense increased 11.4%
Slide 24: Net Interest Margin
Net Interest Margin 4.02% 3.99% 3.95% 3.78% ~ Dec og Mar 07 Jun 07 Sep 07 Dec 07 { = cTBI _ Peer ] = Pressure on the margin = % of assets repricing = 1-year cumulative gap position » Within 30 days 37.2% at 12/31/07 -4.78% = % of liabilities repricing > Within 30 days 16.9% > Within 90 days 25.7% >
Slide 25: Net Noninterest Expense and Efficiency Ratio
Net Noninterest Expense as a % of Average Eaming Assets 1.90% 1.70% + 1.50% 2003 2004 2005 2006 2007 eee Watinicie! cagenss 2 bE Sani Apecie® Noninterest Expense G Efficiency Ratio (in millions) $70.6 $00.4 $2.4 aa wae. = —— | sane ‘2003 2004 2005 ‘zo06 2007 SSeS ser [Efficiency Ratio | = 2008 proje
Slide 26: 2007 Balance Sheet Review
2007 Balance Sheet Review
Slide 27: Total Assets
Total Assets (in billions) $2.71 fa Sie at pica $2.48 2003 2004 2005 2006 2007 = Total assets decreased 2.3% during 2007 to $2.90 billion >» Loan growth $60.4 million > Deposit decline $50.7 million > Investment portfolio decline $109.2 million = Total assets are expected to increase — $40 million t
Slide 28: Total Loans
Total Loans (in billions) $2.23 $2.11 $2.17 $1.90 $1.74 2003 2004 2005 2006 2007 2008 projected loan growth $165 to $185 million Loan Portfolio Mix December 31, 2007 Consumer 20% Comm R/E 35% R/E Mortgage 30% Comm Other 15%
Slide 29: Net Charge-offs, Loan Loss Reserve, Nonperforming Loans
Net Charge-offs Bae ol avenge leatis 0.48% %, 0.37% waa] dd’ rin 2003 2004 2005 2006 2007 Loan Loss Reserve as a %of net loans 1.42% 1.42% 1.40% 1.27% 1.26% 2003 2004 2005 2006 2007 Nonperforming Loans as a %of total loans 1.43% o.s7% 196% 1.02% 2003 2004 2005 2006 2007
Slide 30: Total Deposits
Total Deposits including Repurchase Agreements (in billions) $2.23 $2.16 2003 2004 2005 2006 2007 Total deposits including repurchase agreements are expected to increase $72 to $78 million in 2008 Total Deposits including Repurchase Agreements December 31, 2007 Repurchase Agreements os Noninterest B
Slide 31: 1st Quarter 2008 Review
1st Quarter 2008 Review
Slide 32: Net Income
Net Income (in millions) $10.5 Mar'07 Jun'O7 Sept'07 Dec'07 Mar ‘08
Slide 33: Net Income
Net Income Net interest income > Increased $0.4 million year over year > Decreased $0.6 million quarter over quarter Provision for loan losses > Increased $1.9 million year over year > Increased $0.1 million quarter over quarter Noninterest income > Increased $0.2 million year over year > Decreased
Slide 34: Noninterest Income
Noninterest Income (in millions) Jun "O77 Sept 'O7 Dec ‘07 Mar "08 Mar "07 = Increased gains on sales of loans = Deposit service charges > Increased year over year, but seasonal decline quarter over quarter = Decreased loan related fees > Decline in fair value of mortgage servicing rights
Slide 35: Noninterest Expense
Noninterest Expense (in millions) $22.5 $20.9 Mar'O7 Jun'O7 Sept'O7 Dec'O7 Mar 'os = Large variance from prior year related to unamortized debt issuance costs related to redemption of trust preferred debentures and no accrual for employee incentive compensation plan
Slide 36: Total Loans
Total Loans (in billions) $2.17 $2.19 $2.21 $2.20 $2.22 Mar'o7 Jun '"O7 Sept "O07 Dec '07 Mar "08s = Loan portfolio grew at an annualized rate of 4.3% during the quarter and 3.7% from March 31, 2007
Slide 37: Total Deposits
Total Deposits including Repurchase Agreements (in billions) $2.56 $2.52 $2.48 $2.45 $2.45 Mar ‘07 Jun ‘O07 Sept '07 Dec ‘07 Mar "08 = Deposits, including repurchase agreements, remained stable from prior quarter but declined $107.2 million or 4.2% from prior year >» Continued focus on net interest
Slide 38: Nonperforming Loans
Nonperfonning Loans as a % of Total Loans 1.89% 1.41% 1.43% Mar ‘07 Jun ‘O07 Sept '07 Dec ‘07 Mar '08 = Economic diversity of our region = 2 regions experiencing pressure in the housing market m= 2 regions not experiencing significant economic pressure
Slide 39: Efficiency Ratio
Efficiency Ratio 64.68% 58.22% 55.60% 56.39% 52.36% Mar'O?7 Jun'O? Sept'O07 Dec'O7 Mar'ds
Slide 40: 2008 Key Strategic Initiatives
2008 Key Strategic Initiatives
Slide 41: CTBI: 2008 Outlook
CTBI: 2008 Outlook Net Income Earnings Per Share Asset Growth Loan Growth Deposit Growth Efficiency Ratio Shareholders’ Equity $34 - $36 million $2.25 - $2.45 per share $40 - $45 million $165 - $185 million $72 - $78 million 56% - 58% $317 - $319 million
Slide 42: 2008 Operational Initiatives
2008 Operational Initiatives Attaining our 2008 corporate goals = Working through our asset quality issues . Focus on core banking business = Internal growth and expansion through new branches and acquisitions = Continued expansion of trust and brokerage services = Improved management and customer i
Slide 43: 2008 Operational Challenges
2008 Operational Challenges Major impacts on 2008 corporate goals The U.S. economy Action by the U.S. Government to manage current economic issues Loan growth Asset quality Net interest margin Noninterest income Profitable deposit growth driven by liquidity needs’
Slide 44: CTBI's Franchise Value
CIBI's Franchise Value History of solid investor returns Community banking strategy Historical ability to grow and have good financial performance in slow growth markets Growth strategies. > Acquisitions > Denova branches > Trust subsidiary > Fullservice brokerage Strong experienced management team
Slide 45: Shareholders
Shareholders: Your management has a Strategic Plan for the performance and operations of your company. Success will be attained by the execution of this plan, not just by management, but by approximately 1000 employees. The continuing support by you, our shareholders, by referring your friends, neig
Community Trust Bancorp — Shareholder Meeting (April 2008) on 6ix