Community Trust Bancorp, Inc. · NASDAQ:CTBI
Community Trust Bancorp — Sandler O'Neill East Coast Financial Services Conference (November 2018)
41 slides from Community Trust Bancorp's conference presentation, Nov 6, 2018
Slide 1: Investor Presentation
Investor PresentationFebruary 2018 Sandler O’Neill East Coast Financial Services Conference Presentation
Slide 2: Cautionary Statement
Cautionary Statement Information provided herein by CTBI contains “forward-looking” information. CTBI cautions that any forward-looking statements made are not guarantees of future performance and that actual results may differ materially from those in the forward-looking statements. Please refer to
Slide 3: Key Metrics
Total Assets $4.2 billionMarket Capitalization $821.7 millionCash Dividend Yield 3.11%P/E Ratio 14.1xPrice to Book Value 1.5xPrice to Tangible Book Value 1.7xTangible Common Equity Ratio 11.80%Competitive Position2nd largest Kentucky domiciled bank holding company #2 in Kentucky in deposit market sh
Slide 4: Corporate History
4 1903 Pikeville National bank formed1987-2005 Acquired 14 banks and purchased 17 branch locations1997 Changed name to Community Trust Bancorp, Inc.2010 Acquired LaFollette First National CorporationPresently Two operational subsidiaries~ Community Trust Bank, Inc. and Community Trust and Investment
Slide 5: Our Banking Franchise
Serving customers in 79 branch locations in 35 counties throughout Kentucky, Tennessee, and West Virginia, including 5 trust offices in Kentucky and Tennessee 5 Our Banking Franchise
Slide 6: Our Banking Franchise by Region
Financial data as of September 30, 2018 6 Our Banking Franchise Central Region Eastern Region Northeastern RegionLoans - $676 million Loans - $952 million Loans - $363 millionDeposits - $824 million Deposits - $1.4 billion Deposits - $514 million• Danville • Floyd/Knott/Johnson • Advantage Valley• L
Slide 7: Trust Assets Under Management & Trust Revenue
Assets in billionsRevenue in millions 7 Includes CTB portfolio Trust Assets Under Management &Trust Revenue Sept ’18 Revenue annualized
Slide 8: Executive Management Team
8 Banking Yrs. w/Name Position Experience CTBIJean R. Hale Chairman, President and CEO 49 years 49Mark A. Gooch CTB President and CEO 37 years 37Andy Waters CTIC President and CEO 31 years 14Kevin J. Stumbo EVP/Chief Financial Officer 31 years 23Steven E. Jameson EVP/Risk Manager 33 years 14James J.
Slide 9: Operational Philosophy
9 Traditional community banking business modelExecutive management and board of director commitment to corporate governanceDecentralized decision making and centralized operations and risk managementStrong loan portfolio risk management processSpecialized product offeringsMaintain a strong tangible
Slide 10: Consistent Financial Performance
10 YTD 2018 2017 2016 2015 2014 EPS $2.46 $2.92 $2.70 $2.66 $2.50ROAA 1.39% 1.27% 1.21% 1.23% 1.18%ROAE 10.72% 9.93% 9.58% 9.97% 9.94%Net Int. Margin 3.65% 3.67% 3.70% 3.81% 3.92%Efficiency Ratio 60.88% 58.66% 58.54% 58.20% 59.12%Nonperforming Loans 0.66% 0.91% 0.93% 1.00% 1.42%Net Charge-offs 0.20%
Slide 11: Earnings Review
Earnings Review fl.
Slide 12: Earnings Per Share
EPS increased 18.3% from 3rd quarter 2017 to 3rd quarter 20182018 EPS goal - $3.32 to $3.40 per share 12 Earnings Per Share
Slide 13: Net Income
(in millions) Net income increased 19.0% from 3rd quarter 2017 to 3rd quarter 2018Income tax rate change positively impacted earnings as our effective income tax rate for the nine months ended September 30, 2018 was 16% compared to 28% for the nine months ended September 30, 20172018 goal for net in
Slide 14: Revenues
(in millions) Revenues increased 5.2% from 3rd quarter 2017 to 3rd quarter 20182018 goal for revenues - $188.9 to $194.6 million 14 Revenues Sept ‘18 annualized
Slide 15: Noninterest Income as a % of Total Revenue
YTD noninterest income increased 10.0% year over year for the nine months ended September 30Increases in trust revenue, deposit service charges, loan related fees, and bank owned life insurance2018 goal for noninterest revenue – 25.0% to 27.0% of total revenue Noninterest Incomeas a % of Total Reven
Slide 16: Net Interest Revenue
YTD net interest revenue increased by 3.5% year over year for the nine months ended September 30Net interest margin decreased 3 basis pointsAverage earning assets increased $130.1 million, or 3.4% (in millions) Net Interest Revenue 16 Sept ‘18 annualized
Slide 17: Net Interest Margin
Net Interest Margin Pressure on the margin1-year cumulative gap position at 9/30/18 – (8.25)% % of assets repricingWithin 30 days 30.68%% of liabilities repricing Within 30 days 44.65%Within 90 days 53.54%Within 180 days 59.33% Peer data obtained from the Federal Reserve Bank Holding Company Perform
Slide 18: Noninterest Expense & Efficiency Ratio
Net Noninterest Expenseas a % of Average Earning Assets Noninterest Expense & Efficiency Ratio (in millions) (in millions) Peer data obtained from the Federal Reserve Bank Holding Company Performance Report as of 6/30/2018 for bank holding companies with consolidated assets of $3 billion to $10 bill
Slide 19: Return on Average Assets
Return on Average Assets Peer data obtained from the Federal Reserve Bank Holding Company Performance Report as of 6/30/2018 for bank holding companies with consolidated assets of $3 billion to $10 billion. 19
Slide 20: Balance Sheet Review
Balance Sheet Review fl.
Slide 21: Total Assets
Total assets at 9/30/18 increased $37.6 million, or an annualized 1.2%, from 12/31/2017Loans increased $54.9 million or an annualized 2.4%Investment portfolio decreased $16.6 million or an annualized 3.8%Deposits grew $17.0 million or an annualized 0.6%2018 goal for total assets - $4.15 to $4.32 bil
Slide 22: Total Loans
(in billions) Total Loans Loans increased $54.9 million, or an annualized 2.4%, from 12/31/172018 goal for total loans - $3.15 to $3.35 billion September 30, 2018 Loan PortfolioMix 22
Slide 23: Concentrations of Credit
Concentrations of Creditas a % of Total Loans September 30, 2018 * As a percentage of funded exposure 23
Slide 24: Indirect Lending
24 Indirect Lending (in millions) Sept ’18 annualized
Slide 25: Net Charge-offs and Nonperforming Loans
Net Charge-offsas a % of Average Loans NonperformingLoansas a % of Total Loans Peer data obtained from the Federal Reserve Bank Holding Company Performance Report as of 6/30/2018 for bank holding companies with consolidated assets of $3 billion to $10 billion. September 30, 2018 25
Slide 26: Nonperforming Assets and Loan Loss Reserve
Nonperforming Assetsas a % of Total Assets Loan Loss Reserveas a % of Net Loans $29.7 million in other real estate owned Peer data obtained from the Federal Reserve Bank Holding Company Performance Report as of 6/30/2018 for bank holding companies with consolidated assets of $3 billion to $10 billio
Slide 27: Total Other Real Estate Owned
Total Other Real Estate Owned Sales of foreclosed properties for the nine months ended 9/30/18 totaled $4.0 millionNew bookings in the first nine months of 2018 totaled $3.7 millionProperties under contract to sell at September 30, 2018 totaled $2.8 million (in millions) 27
Slide 28: Total Deposits including Repurchase Agreements
(in billions) Total Depositsincluding Repurchase Agreements 2018 goal for total deposits including repurchase agreements - $3.47 to $3.61 billion Total Depositsincluding Repurchase Agreements September 30, 2018 28
Slide 29: Hoops CD
29 Our Hoops CD product has been offered for over 20 years100 basis point increase in rate in 1996, 1998, and 2012 with the University of Kentucky’s NCAA Basketball Championships$202 million in Hoops CDs as of 9/30/18 12 Month Certificate of Deposit: April 10th through maturity, rate paid is adjuste
Slide 30: Shareholder Value
30 Shareholder Value
Slide 31: Dividends Per Share
Dividends Per Share 2017 cash dividends increased 3.2%Dividend payout ratio at September 30, 2018 was 41.46%Desired level between 40% and 50%September 30, 2018 cash dividend yield was 3.11%Cash dividend increased 9.1% to $0.36 per share effective October 1, 2018 31 * 2018 is projected DPS
Slide 32: Shareholders' Equity
Shareholders’ Equity (in millions) Shareholders’ equity has increased 28.7% during the past five years5.8% compound growth rate for the past five years2018 goal for shareholders’ equity - $552.6 to $575.2 million 5.8% 32
Slide 33: Book Value Per Share / Tangible Common Equity to Assets
Book ValuePer Share Tangible Common Equity/Assets 33
Slide 34: Price to Tangible Book Value and Market Capitalization
Peer data obtained from SNL Financial; peer group consists of publicly traded regional bank holding companies with comparative asset size, as defined in our Proxy Statement. (in millions) Price to Tangible Book Value 2013 2014 2015 2016 2017 9/30/18 CTBI 2.06x 1.67x 1.50x 2.01x 1.79x 1.70x Peer 1.72
Slide 35: Cumulative Total Return Comparison
5 Year Cumulative Total ReturnComparison of CTBI, NASDAQ Stock Market (U.S.), and NASDAQ Bank Stocks An investment in CTBI stock on December 31, 2012 would have underperformed the NASDAQ Stock Market (U.S.) and the NASDAQ Bank Stocks Index at December 31, 2017. 35
Slide 36: Comparison to Russell 2000 Index
Comparison to Russell 2000 Indexof Small Cap Companies Return to Investors 3-, 5-, and 10-year total returns annualized September 30, 2018 36
Slide 37: Core Value Long-Term Investment
Core Value Long-Term Investment 12 stock splits and 10 stock dividends38 years of consecutive increases in cash dividends5-year compound growth rate of cash dividends 2.7%Stock included in the NASDAQ Global Select Market, NASDAQ Dividend Achievers Index, and NASDAQ Bank Stock IndexRecognized as one
Slide 38: Key Strategic Initiatives
38 Key Strategic Initiatives
Slide 39: Operational Priorities
Operational Priorities Build core earnings capacityQuality loan growthLow cost deposit growthMaintain net interest margin Operational efficiencyExpense controlNoninterest revenue growthCompliance managementIncrease noninterest incomeWealth managementBrokerageLife insuranceContinuing focus on improvi
Slide 40: CTBI's Franchise Value
CTBI’s Franchise Value History of solid investor returnsHistorically strong capital positionInvestor focused dividend policyDividend Achievers IndexConsistent financial performanceCommunity banking strategyEconomic diversity in the markets we serveStrong experienced management team and over 1,000 de
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