F.n.b. Corporation · NYSE:FNB
F.n.b — Investor Presentation (February 2018)
39 slides from F.n.b's investor presentation, February 2018
Slide 1: Investor Presentation February 2018
Investor Presentation February 2018 F.N.B. Corporation
Slide 2: Cautionary Statement Regarding Forward-Looking Information and Non-GAAP Financial Information
Cautionary Statement Regarding Forward-Looking Information and Non-GAAP Financial Information This document contains forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which contain F.N.B. Corporation’s (F.N.B.) expectations or predictions of futur
Slide 3: Key Investment Considerations
Key Investment Considerations o FNB’s business model is designed to deliver long-term shareholder value o Past infrastructure investments have positioned FNB well for sustainable growth o We intend to achieve consistent growth while adhering to our risk profile o We are committed to continued effici
Slide 4: About FNB Corporation
About FNB Corporation o Headquarters: Pittsburgh, PA High-Quality, o Market capitalization: $4.5 billion1 Growing Regional Financial Institution o Banking locations: Over 4001 o Total Assets: $31 Billion1 o Regional bank focused on serving consumer and wholesale banking clients • Adhere to a low-ris
Slide 5: An Infrastructure Built for Long-Term Sustainable Growth
An Infrastructure Built for Long-Term Sustainable Growth 2014 2015 2016 2017 2018 Talent Management Chief Technology & Chief Wholesale Strengthened team Chief Marketing Retention of support personnel, Hired EVP of Capital Banking and Chief Chief Information Security through key hires; Officer filled
Slide 6: Strategic Objectives 2018 and Beyond
Strategic Objectives 2018 and Beyond Consumer Commercial Fee-Based o Enhance analytics capabilities to better o Continue expansion of equipment o Develop a new SBA loan product understand customers’ needs and finance for middle market borrowers offering for smaller businesses increase share of walle
Slide 7: Becoming a Data-Driven Bank
Becoming a Data-Driven Bank Evolving Our Marketing Data Capabilities Front-Line Impact • Investments in proprietary data science and targeted • Internally generated leads incorporated into targeted marketing capabilities marketing campaigns • Leads shared with front line to initiate consultative • D
Slide 8: A Consistent Experience across Channels
A Consistent Experience across Channels Clicks-to-Bricks is the seamless integration of traditional and digital channels to create a consistent, exceptional customer experience whether in the branch, online, or mobile Channel Branch Experience aligned with Digital Experience o Solution Center featur
Slide 9: Select Loan Portfolios
Select Loan Portfolios 1Q17 2Q17 3Q17 4Q17 1Q17 2Q17 3Q17 4Q17 Residential Mortgage Indirect Installment 3.31% 4.14% 3.26% 3.16% $2,535 $2,653 +4.6%1 $2,413 $1,406 $1,441 +2.4%1 $1,969 4.02% 3.08% $1,311 4.08% $1,226 4.01% Average Balance Yield Average Balance Yield Consumer LOC Commercial 4.66% 4.6
Slide 10: Key Fee-Based Businesses
Key Fee-Based Businesses $ in millions 1Q17 2Q17 3Q17 4Q17 o Provides full range of consumer and commercial insurances Insurance $5.1 $5.0 $4.3 $4.5 o Focus on cross-sell, further development of personal lines Insurance Commissions and Fees $3.6 $3.9 $4.0 $3.7 o Provides solutions to businesses, ind
Slide 11: Capital Markets and Specialty Finance
Capital Markets and Specialty Finance $ in millions 1Q17 2Q17 3Q17 4Q17 o Realigned strategy supports FNB LOBs $1.3 in our core footprint and nearby states Small Business $1.1 Administration $0.9 o Focus on credit quality, documentation process, and mitigating “put-back” risk $0.1 SBA Operations o F
Slide 12: Execution of FNB's Long-Term Growth Strategy
Execution of FNB’s Long-Term Growth Strategy Key Performance Indicators FY 2017 Actual 2-3 Year Target Key Strategy Originated net charge-offs Remain disciplined Maintain Low-Risk Profile 33 bps 25-50 bps /average loans through the cycle Drive Loan and Deposit Average loans 6%1 Mid-to-High Grow and
Slide 13: Operating Results
Operating Results 4Q17 Highlights and Relative Performance to Peers 13
Slide 14: 4Q17 Financial Highlights
4Q17 Financial Highlights 4Q17 3Q17 4Q16 FY 2017 FY 2016 Net income available to common stockholders $22.1 $75.7 $49.3 $191.2 $162.9 Reported Results Net income per diluted common share $0.07 $0.23 $0.23 $0.63 $0.78 Book value per common share $13.30 $13.39 $11.68 Operating net income available to c
Slide 15: Asset Quality
Asset Quality1 $ in thousands 4Q17 3Q17 4Q16 4Q17 Highlights NPLs+OREO/Total average originated 0.81% 0.91% 0.91% loans and leases + OREO o Consistent and stable credit quality results across the portfolio Originated Delinquency 0.88% 0.91% 1.04% Provision for credit losses2 $16,699 $16,768 $12,705
Slide 16: Balance Sheet Highlights
Balance Sheet Highlights QoQ YoY Average, $ in millions 4Q17 3Q17 4Q16 QoQ Δ YoY Δ Organic1 Δ Organic1 Δ 4Q17 Highlights Securities $5,855 $5,725 $4,364 2.3% 34.2% o Growth in consumer loans driven by indirect Total Loans $20,812 $20,654 $14,820 0.8% 40.4% 3.0% 6.4% auto and residential mortgage Com
Slide 17: Revenue Highlights
Revenue Highlights $ in thousands 4Q17 3Q17 4Q16 QoQ Δ YoY Δ 4Q17 Highlights Total interest income $271,085 $263,514 $177,168 2.9% 53.0% Total interest expense 41,049 38,283 17,885 7.2% 129.5% o Interest income supported Net interest income $230,036 $225,231 $159,283 2.1% 44.4% by continued loan gro
Slide 18: Non-Interest Income
Non-Interest Income $ in thousands 4Q17 3Q17 4Q16 QoQ Δ YoY Δ 4Q17 Highlights Service charges $32,504 $33,610 $25,175 (3.3%) 29.1% Trust services 5,911 5,748 5,218 2.8% 13.3% o Capital markets activity increased during the quarter, led by derivative Insurance commissions and fees 4,546 5,029 4,436 (
Slide 19: Non-Interest Expense
Non-Interest Expense $ in thousands 4Q17 3Q17 4Q16 QoQ Δ YoY Δ 4Q17 Highlights Salaries and employee benefits $86,033 $82,383 $61,117 4.4% 40.8% Occupancy and equipment 28,255 27,434 19,736 3.0% 43.2% o Salaries and benefits expense includes higher FDIC insurance 8,956 9,183 4,858 (2.5%) 84.4% varia
Slide 20: Full Year 2018 Financial Objectives
Full Year 2018 Financial Objectives Category FY 2018 Target Loans High-single digit growth1 Balance Sheet Deposits Mid-to-high-single digit growth1 Net interest income Mid-single digit growth2 Provision expense $70-$80 million Income Statement Noninterest income Mid-to-high single digit growth2 Noni
Slide 21: Supplemental Information
Supplemental Information 21
Slide 22: Annual Operating Trends
Annual Operating Trends 2017 2016 2015 2014 2013 Net income available to common Operating Earnings1 stockholders $281.2 $187.7 $153.7 $143.6 $123.1 (Non-GAAP) Net income per diluted common share $0.93 $0.90 $0.87 $0.85 $0.84 Return on average assets 0.99% 0.95% 0.97% 1.02% 0.97% Profitability Return
Slide 23: Diversified Loan Portfolio
Diversified Loan Portfolio $21 Billion Loan Portfolio % of December 31, 2017 12/31/2017 Portfolio ($ in millions) Balance 12/31/17 Commercial & Direct Industrial 20% Commercial Real Estate $8,742 42% Installment 12% Commercial & Industrial 4,171 20% Commercial Leases 267 1% Residential Mortgage 13%
Slide 24: Loan Risk Profile
Loan Risk Profile YTD Net Charge- Total Past 1 1 1 ($ in millions) % of Loans NPL's/Loans Offs/Loans Due/Loans Commercial and Industrial 19.1% 0.65% 0.75% 0.72% CRE: Non-Owner Occupied 26.9% 0.32% -0.04% 0.35% CRE: Owner Occupied 14.7% 1.24% 0.08% 1.28% Home Equity and Other Consumer 16.8% 0.73% 0.1
Slide 25: Deposits and Customer Repurchase Agreements
Deposits and Customer Repurchase Agreements 12/31/2017 Mix % $22.7 Billion Deposits and Customer Repo Agreements ($ in millions) December 31, 2017 Balance 12/31/17 Savings, NOW, MMDA $11,971 53% Non-Interest Bearing 5,720 25% Non-Interest Bearing 25% Transaction Deposits $17,691 Time Deposits 4,708
Slide 26: Investment Portfolio
Investment Portfolio Highly Rated $6.0 Billion Investment Portfolio % Ratings December 31, 2017 AAA, ($ in millions1) Portfolio Investment % 85.7% Agency MBS $2,819 47% AAA 100% Agency CMO 1,572 26% AAA 100% Agency Debentures 591 10% AAA 100% AAA 9% AA 76% AA, 11.9% Municipals 938 16% A 14% A, 2.3%
Slide 27: 2018 Peer Group Listing
2018 Peer Group Listing Ticker Institution Ticker Institution ASB Associated Banc-Corp PBCT People’s United Financial, Inc. CBSH Commerce Bancshares, Inc. PB Prosperity Bancshares, Inc. CMA Comerica, Inc. SNV Synovus Financial Corp. CFR Cullen/Frost Bankers, Inc. TCF TCF Financial Corp. EWBC East We
Slide 28: Non-GAAP to GAAP Reconciliation
Non-GAAP to GAAP Reconciliation For The Quarter Ended $ in thousands except per share amounts 31-Dec-17 30-Sep-17 30-Jun-17 31-Mar-17 31-Dec-16 Operating net income available to common stockholders Net income available to common stockholders $ 22,115 $ 75,683 $ 72,396 $ 20,969 $ 49,280 Merger-relate
Slide 29: Non-GAAP to GAAP Reconciliation
Non-GAAP to GAAP Reconciliation For The Quarter Ended $ in thousands 31-Dec-17 30-Sep-17 30-Jun-17 31-Mar-17 31-Dec-16 Return on average tangible common equity (ROATCE) Net income available to common stockholders (annualized) $ 87,740 $ 300,266 $ 290,381 $ 85,042 $ 196,049 Amortization of intangible
Slide 30: Non-GAAP to GAAP Reconciliation
Non-GAAP to GAAP Reconciliation For The Quarter Ended $ in thousands 31-Dec-17 30-Sep-17 30-Jun-17 31-Mar-17 31-Dec-16 Return on average tangible assets (ROATA) Net income (annualized) $ 95,719 $ 308,237 $ 298,443 $ 93,191 $ 204,050 Amortization of intangibles, net of tax (annualized) 12,381 12,392
Slide 31: Non-GAAP to GAAP Reconciliation
Non-GAAP to GAAP Reconciliation For The Quarter Ended $ in thousands 31-Dec-17 30-Sep-17 30-Jun-17 31-Mar-17 31-Dec-16 Operating net income Net income $ 24,126 $ 77,693 $ 74,406 $ 22,979 $ 51,291 Merger-related expense 1,054 1,381 1,354 52,724 1,649 Tax benefit of merger-related expense (365) (483)
Slide 32: Non-GAAP to GAAP Reconciliation
Non-GAAP to GAAP Reconciliation For The Quarter Ended $ in thousands except per share amounts 31-Dec-17 30-Sep-17 30-Jun-17 31-Mar-17 31-Dec-16 Tangible book value per common share (at period-end) Total stockholders' equity $ 4,409,194 $ 4,435,921 $ 4,392,438 $ 4,355,795 $ 2,571,617 Less: preferred
Slide 33: Non-GAAP to GAAP Reconciliation
Non-GAAP to GAAP Reconciliation For The Quarter Ended $ in thousands 31-Dec-17 30-Sep-17 30-Jun-17 31-Mar-17 31-Dec-16 Efficiency Ratio (FTE) Non-interest expense $ 166,529 $ 163,743 $ 163,714 $ 187,555 $ 123,806 Less: amortization of intangibles 4,801 4,805 4,813 3,098 1,602 Less: OREO expense 1,02
Slide 34: Non-GAAP to GAAP Reconciliation
Non-GAAP to GAAP Reconciliation For The Quarter Ended $ in thousands 31-Dec-17 30-Sep-17 30-Jun-17 31-Mar-17 31-Dec-16 Components of net interest income Net interest income $ 230,036 $ 225,231 $ 218,415 $ 172,752 $ 159,283 Net interest margin (FTE)(1) 3.49% 3.44% 3.42% 3.35% 3.35% Incremental purcha
Slide 35: Non-GAAP to GAAP Reconciliation
Non-GAAP to GAAP Reconciliation For The Fiscal Year $ in thousands except per share amounts 2017 2016 2015 2014 2013 Operating net income available to common stockholders Net Income available to common stockholders $ 191,163 $ 162,850 $ 151,608 $ 135,698 $ 117,804 Merger-related expense, net of tax
Slide 36: Non-GAAP to GAAP Reconciliation
Non-GAAP to GAAP Reconciliation For The Fiscal Year $ in thousands except per share amounts 2017 2016 2015 2014 2013 Return on average tangible common equity (ROATCE) Net income available to common stockholders $ 191,163 $ 162,850 $ 151,608 $ 135,698 $ 117,804 Amortization of intangibles, net of tax
Slide 37: Non-GAAP to GAAP Reconciliation
Non-GAAP to GAAP Reconciliation For The Fiscal Year $ in thousands 2017 2016 2015 2014 2013 Operating net income Net income $ 199,204 $ 170,891 $ 159,649 $ 144,050 $ 117,804 Merger-related expense, net of tax 37,667 24,889 2,084 7,897 5,337 Tax expense of merger-related securities gains (1,696) - -
Slide 38: Non-GAAP to GAAP Reconciliation
Non-GAAP to GAAP Reconciliation For The Fiscal Year $ in thousands except per share amounts 2017 2016 2015 2014 2013 Tangible book value per common share (at-period-end) Total stockholders' equity $ 4,409,194 $ 2,571,617 $ 2,096,182 $ 2,021,456 $ 1,774,383 Less: preferred stockholders' equity 106,88
Slide 39: Non-GAAP to GAAP Reconciliation
Non-GAAP to GAAP Reconciliation For The Fiscal Year $ in thousands except per share amounts 2017 2016 2015 2014 2013 Efficiency Ratio Non-interest expense $ 681,542 $ 511,133 $ 390,549 $ 379,253 $ 338,170 Less: amortization of intangibles 17,517 11,210 8,305 9,717 8,407 Less: OREO expense 4,438 5,15