 F.N.B. Corporation
Third Quarter 2013
Investor Presentation
Guggenheim Partners –
New York, NY
November 6, 2013
Exhibit 99.1 |
 Cautionary Statement Regarding Forward-Looking Information
and Non-GAAP Financial Information
2
This presentation and the reports F.N.B. Corporation files with the Securities and Exchange Commission
often contain “forward-looking statements” relating to present or future
trends or factors affecting the banking industry and, specifically, the financial operations, markets and
products of F.N.B. Corporation. These forward-looking statements involve certain risks and
uncertainties. There are a number of important factors that could cause F.N.B.
Corporation’s future results to differ materially from historical performance or projected performance. These factors
include, but are not limited to: (1) a significant increase in competitive pressures among financial
institutions; (2) changes in the interest rate environment that may reduce interest margins;
(3) changes in prepayment speeds, loan sale volumes, charge-offs and loan loss provisions; (4)
general economic conditions; (5) various monetary and fiscal policies and regulations of the U.S.
government that may adversely affect the businesses in which F.N.B. Corporation is engaged; (6)
technological issues which may adversely affect F.N.B. Corporation’s financial operations
or customers; (7) changes in the securities markets; (8) risk factors mentioned in the reports and
registration statements F.N.B. Corporation files with the Securities and Exchange Commission;
(9) housing prices; (10) job market; (11) consumer confidence and spending habits; (12) estimates
of fair value of certain F.N.B. Corporation assets and liabilities; (13) transaction risks associated
with the pending merger of BCSB Bancorp, Inc., and integration challenges related to the
recently completed mergers with PVF Capital Corp. and Annapolis Bancorp, Inc. and the difficulties
encountered in expanding into a new market and (14) the effects of current, pending and future
legislation, regulation and regulatory actions. F.N.B. Corporation undertakes no
obligation to revise these forward-looking statements or to reflect events or circumstances after the date of this
presentation.
To supplement its consolidated financial statements presented in accordance with Generally Accepted
Accounting Principles (GAAP), the Corporation provides additional measures of operating
results, net income and earnings per share (EPS) adjusted to exclude certain costs, expenses,
and gains and losses. The Corporation believes that these non-GAAP financial measures are appropriate to enhance the
understanding of its past performance as well as prospects for its future performance. In the
event of such a disclosure or release, the Securities and Exchange Commission’s Regulation
G requires: (i) the presentation of the most directly comparable financial measure calculated and
presented in accordance with GAAP and (ii) a reconciliation of the differences between the
non-GAAP financial measure presented and the most directly comparable financial measure
calculated and presented in accordance with GAAP.
The Appendix to this presentation contains non-GAAP financial measures used by the Corporation to
provide information useful to investors in understanding the Corporation's operating
performance and trends, and facilitate comparisons with the performance of the Corporation's peers.
While the Corporation believes that these non-GAAP financial measures are useful in evaluating the
Corporation, the information should be considered supplemental in nature and not as a
substitute for or superior to the relevant financial information prepared in accordance with GAAP.
The non-GAAP financial measures used by the Corporation may differ from the non-GAAP financial
measures other financial institutions use to measure their results of operations. This
information should be reviewed in conjunction with the Corporation’s financial results disclosed on
October 17, 2013 and in its periodic filings with the Securities and Exchange Commission. |
 Important Information About the Pending Mergers
3
Merger
of
F.N.B.
and
BCSB
Bancorp.
In
connection
with
the
proposed
merger
between
F.N.B.
and
BCSB
Bancorp,
a
definitive
proxy
statement
of
BCSB
Bancorp and prospectus of F.N.B. will be filed with the SEC. SHAREHOLDERS OF
BCSB BANCORP, INC. ARE URGED TO READ THE DEFINITIVE PROXY
STATEMENT/PROSPECTUS
AND
ANY
OTHER
RELEVANT
DOCUMENTS
THAT
ARE
FILED
WITH
THE
SEC,
AS
WELL
AS
ANY
AMENDMENTS
OR SUPPLEMENTS TO THOSE DOCUMENTS, BECAUSE THEY WILL CONTAIN IMPORTANT
INFORMATION. F.N.B. and BCSB Bancorp and certain of their directors and
executive officers may be deemed to be participants in the solicitation of proxies from BCSB
Bancorp
shareholders
in
connection
with
the
proposed
merger.
Information
concerning
such
participants’
ownership
of
BCSB
Bancorp
common
stock
will
be
set forth in the definitive proxy statement/prospectus.
Where to Find Additional Information. A free copy of the definitive proxy
statement/prospectus for each pending merger (when it is available), as well as other
documents containing information about F.N.B. Corporation and BCSB Bancorp, Inc.,
may be obtained at the SEC’s Internet site (http://www.sec.gov). In
addition, investors and security holders may obtain free copies of the documents
that F.N.B. and BCSB Bancorp have filed with the SEC by contacting the
following persons at each corporation:
F.N.B.:
James
G.
Orie,
Chief
Legal
Officer,
F.N.B.
Corporation,
One
F.N.B.
Boulevard,
Hermitage,
PA
16148,
telephone:
(724)
983-3317
BCSB
Bancorp:
Joseph
J.
Bouffard,
President
and
Chief
Executive
Officer,
BCSB
Bancorp,
Inc.,
4111
East
Joppa
Road,
Baltimore,
MD
21236,
telephone:
(410) 256-5000 |
 4
F.N.B. Corporation
Key Investment Considerations
About F.N.B. Corporation
Experienced Leadership Team
Reposition and Reinvest Strategy Drives Growth
Strong Operating Trends |
 Key
Investment Considerations 5
Consistent Strategy Focused on Long-Term Perspective
Achieved organic growth throughout the recent economic cycle, largely driven by
growth in loans and low-cost deposits Consistent and high-quality
operating results Continuous investments in People, Process, Products and
Productivity Maintain lower-risk profile with significant investments
in enterprise-wide risk management Strong culture focused on people,
talent management, cross-sell and sophisticated product offerings Proven
success achieving top market position in major markets and across footprint
Proven ability to compete effectively against much larger peers
Disciplined acquisition and expansion strategy focused on organic growth
potential Long-term investment thesis centered on efficient capital
management and generating shareholder value Attractive relative valuation
with consistent and supported P/TBV, modest P/E and strong dividend yield KEY INVESTMENT
CONSIDERATIONS – Differentiating Factors |
 About F.N.B. Corporation
6
(1) Pro-forma for the recently completed PVFC acquisition, which closed October 12, 2013
with assets of approximately $0.7 billion, loans of $0.5 billion, deposits of $0.6
billion and 16 banking locations and the pending acquisition of BCSB Bancorp, expected to close 1Q14 with assets of approximately $0.6
billion, loans of $0.3 billion, deposits of $0.6 billion and 16 banking locations (2) SNL
Financial, Pro-forma for PVFC & BCSB, excludes custodian bank; (3) As of
November 1, 2013
Fourth Largest
Pennsylvania-Based Bank
Positioned for Sustained Growth
Consistent, Strong Operating Results
Operating Strategy
Assets:$14.1 billion
(1)
Loans:$9.6 billion
(1)
Deposits:$11.8 billion
(1)
Banking locations:282
(1)
Consumer finance locations:72
Attractive and expanding footprint: PA/OH/MD/WV: Banking locations span 56
counties and four states
(1)
Leading market position (Pro-Forma)
(2)
#3 market share in the Pittsburgh MSA
#10 market share in the Baltimore MSA
#6 overall market position for all counties of operation
Top quartile profitability performance
Deliver consistent, solid results
Industry-leading, consistent loan growth through recent economic cycle
Strong
performance:3-year
total
shareholder
return
of
73%
(3)
Reposition
and
reinvest
for
sustained
growth;
maintain
low
risk
profile
Reposition and reinvest for sustained growth
Maintain disciplined expense control
Expanding market share potential and growth opportunities
Maintain low-risk profile |
 Years of
Banking
Experience
Joined FNB
Prior Experience
President and CEO
Vincent J. Delie, Jr.
26
2005
National City
President, First National Bank
John C. Williams, Jr.
42
2008
Huntington
National City
Mellon Bank
Chief Financial Officer
Vincent J. Calabrese, Jr.
25
2007
People’s United
Chief Credit Officer
Gary L. Guerrieri
27
2002
FNB
Promistar
Experienced Leadership Team
7
Experienced and respected executive management team has guided FNB through the cycle
|
 Reposition and Reinvest Strategy
8
Talent Management
Geographic Segmentation
Sales Management/Cross-Sell
Product Development
Branch Optimization
Electronic Delivery Investment
Utilize Acquisitions to Enhance Growth
Opportunities
Proven ability to attract talent
Consistent, strong operating results
Revenue growth
Consistent organic loan growth
Continued organic transaction deposit growth
Attractive market position
Expanded market share potential via entry and
expansion in attractive markets
Strong 3-year total shareholder return
Strategic Focus Drives Long-Term Growth and Performance
Actions
Results |
 Reposition
and
Reinvest
–
Actions
Drive
Long-Term
Performance
9
2009
2010
2011
2012
2013 YTD
PEOPLE
Talent Management
Strengthened team through key
hires; Continuous team
development
Attract, retain, develop best talent
Geographic Segmentation
Regional model
Regional
Realignment
Created 5
&
6
Regions
PROCESS
Sales Management/Cross Sell
Proprietary sales management
system developed and
implemented: Balanced
scorecards, cross-functional
alignment
Consumer
Banking
Scorecards
Consumer Banking Refinement/Daily Monitoring
Continued
Utilization
Commercial
Banking Sales
Management
Expansion to additional lines of
business
Private Banking,
Insurance,
Wealth
Management
PRODUCT
Product Development
Deepened product set and niche
areas allow FNB to successfully
compete with larger banks and
gain share
Private Banking
Capital Markets
Online and mobile banking investment
/implementation –
Online banking enhancements, mobile
banking and app
Online/mobile
banking
infrastructure
complete with
mobile remote
deposit capture
and online
budgeting tools
Asset Based
Lending
Small Business
Realignment
Treasury
Management
PRODUCTIVITY
Branch Optimization
Continuous evolution of branch
network to optimize profitability
and growth prospects
De-Novo Expansion 11 Locations
Consolidate 2
Locations
Consolidate 6
Locations
Consolidate 37
Locations
Consolidate 6
Locations
Acquisitions
Opportunistically expand
presence in attractive markets
CB&T
Parkvale
ANNB Closed 4/13
PVFC Closed 10/13
BCSB 1Q14
th
th |
 Consistent Loan and Transaction Deposit Growth
10
(1) Organic balances exclude initial respective balances acquired upon transaction close for
ANNB (4/2013), PVSA (1/2012) and CBT (1/2011) Consistent Growth in Loans and
Transaction Deposits Loans
(Quarterly, In Billions)
Transaction Deposits and Customer Repos
(Quarterly, In Billions)
$8.7
$8.0
$6.8
$6.0
$7.1
$6.7
$6.4
3Q13
4Q12
4Q11
4Q10
Total
Organic
$8.0
$7.4
$5.8
$5.2
$6.5
$6.3
$5.5
3Q13
4Q12
4Q11
4Q10
Total
Organic
CAGR 4Q10 –
3Q13
Total
17.3%
Organic
(1)
8.9%
CAGR 4Q10 –
3Q13
Total
14.4%
Organic
(1)
6.3% |
 Transaction
Deposit
Growth
-
Strengthened
Funding
Mix
11
(1) Based on period-end balances
Consistent Transaction Deposit Growth Results in Strengthened Deposit Mix
Total Transaction Deposits and Customer Repos Mix
78%
77%
75%
74%
73%
71%
22%
23%
25%
26%
27%
29%
9/30/2013
6/30/2013
3/31/2013
12/31/2012
12/31/2011
12/31/2010
Transaction Deposits and Customer Repos
Time Deposits
Transaction
deposits and
customer repos =
78% of total
deposits and
customer repos
Strong growth in
average non-
interest bearing
deposits of $131.8
million, or 27.5%
annualized,
resulted in further
strengthened mix
3Q13 |
 Peer Leading ROTA and ROTE
12
Return on tangible assets and return on tangible equity are non-GAAP measures and FNB ROTE
and ROTA exclude merger costs, refer to Appendix for GAAP to Non-GAAP
Reconciliation details. Peer data per SNL Financial. ROTA and ROTE
Exceed Peer Results 1.08%
1.08%
1.12%
0.00%
0.20%
0.40%
0.60%
0.80%
1.00%
1.20%
1Q13
2Q13
3Q13
FNB
Peer Group Median
Return on Average Tangible Assets
Return on Average Tangible Equity
17.46%
17.33%
18.33%
0.00%
2.00%
4.00%
6.00%
8.00%
10.00%
12.00%
14.00%
16.00%
18.00%
20.00%
1Q13
2Q13
3Q13
FNB
Peer Group Median |
 High-Quality Earnings
13
(1) At respective period-end. FNB levels represents allowance for loan losses to
total originated loans. Peer data per SNL Financial and based on availability.
FNB Continues to Deliver High-Quality Earnings
Provision for Loan Losses as % of Net Charge-Offs ($)
FNB provision for loan losses exceeds net charge-offs to
support consistent, solid loan growth results
Allowance for Loan Losses/Total Loans (%)
(1)
FNB allowance for loan losses to total loans (originated
portfolio) has remained relatively stable
133%
134%
113%
61%
75%
9/30/2013 YTD
6/30/2013 YTD
2012
FNB
Peer Group Median
1.34
1.35
1.39
1.25
1.34
1.47
9/30/2013
6/30/2013
12/31/2012
FNB
Peer Group Median |
 Market Position
Top Overall and MSA Market Position
Regional Alignment
Presence in Major Markets
Significant Commercial Prospects
14 |
 FNB’s model utilizes six regions, including three in top 30 MSA markets,
with each having a regional headquarters housing cross-functional teams.
FNB
Banking
Footprint
-
Regional
Alignment
15
Source: SNL Financial, Pro-Forma for PVFC and BCSB
Baltimore MSA
Pittsburgh MSA
Cleveland MSA
PVFC Target
Completion
October 2013
ANNB Completed
4/6/2013 &
BCSB Completed
10/12/13
Cleveland
Hermitage
Erie
State College
Harrisburg
Philadelphia
Scranton
WV
OH
PA
NY
MD
Baltimore
Pittsburgh
Top 30 MSA Presence
MSA
Population
Baltimore,
MD
2.7 million
#20 MSA
Pittsburgh,
PA
2.4 million
#22 MSA
Cleveland,
OH
2.1 million
#29 MSA |
 Top
Overall Market Position 16
Source:
SNL
Financial,
deposit
data
as
of
June
30,
2013,
pro-forma
as
of
October
21,
2013,
excludes
custodial
bank.
FNB Pennsylvania Counties of Operation
Rank
Institution
Branch
Count
Total Market
Deposits
($ 000)
Total
Market
Share
(%)
1
PNC Financial Services
399
58,855,363
35.3
2
Royal Bank of Scotland
202
10,073,477
6.4
3
F.N.B. Corporation
224
8,884,922
5.6
4
M&T Bank Corp.
141
7,393,569
4.7
5
Wells Fargo & Co.
65
4,905,156
3.1
6
First Commonwealth
99
4,225,821
2.7
7
Banco Santander
72
4,056,694
2.6
8
Dollar Bank
37
3,556,646
2.2
9
Susquehanna Bancshares
80
3,105,908
2.0
10
First Niagara Financial
73
3,060,621
1.9
Total (1-138)
2,449
158,109,555
100.0
FNB All Counties of Operation
Rank
Institution
Branch
Count
Total Market
Deposits
($ 000)
Total
Market
Share
(%)
1
PNC Financial Services
515
70,806,498
24.2
2
M&T Bank Corp.
247
21,368,411
7..3
3
Bank of America
91
15,886,192
5.4
4
Royal Bank of Scotland
289
14,902,081
5.1
5
KeyCorp
98
12,538,370
4.3
6
F.N.B. Corporation
281
10,995,883
3.8
7
Wells Fargo & Co
124
10,776,383
3.7
8
Huntington
224
10,569,758
3.6
9
FirstMerit Corp.
104
6,941,093
2.4
10
TFS Financial
22
5,950,561
2.0
Total (1-233)
4,346
292,676,461
100.0
FNB
holds
the
#3
overall
retail
market
position
for
Pennsylvania
counties
of
operation
and
#6
position
for
all
counties |
 17
Source: SNL Financial, deposit data as of June 30, 2013, pro-forma as of October 22,
2013, excludes custodial bank (Pittsburgh MSA). All Other MSA’s represent
MSA’s with FNB presence excluding Pittsburgh, Cleveland and Baltimore MSA’s.
Baltimore-Towson, MD MSA
Rank
Institution
Total Deposits
($000)
Market
Share (%)
1
Bank of America Corp.
16,078,490
25.1
2
M&T Bank Corp.
14,292,887
22.3
3
PNC Financial Services Group Inc.
6,789,660
10.6
4
Wells Fargo & Co.
6,049,235
9.5
5
BB&T Corp.
3,909,353
6.1
6
SunTrust Banks Inc.
2,094,589
3.3
7
Susquehanna Bancshares Inc.
1,258,598
2.0
8
First Mariner Bancorp
1,109,454
1.7
9
Capital One Financial Corp.
976,432
1.5
10
F.N.B. Corporation
914,733
1.4
Cleveland-Elyria-Mentor, OH MSA
Rank
Institution
Total Deposits
($000)
Market
Share (%)
1
KeyCorp
11,363,682
21.8
2
PNC Financial Services Group Inc.
6,382,510
12.2
3
TFS Financial Corp. (MHC)
5,425,587
10.4
4
Huntington Bancshares Inc.
4,261,126
8.2
5
Royal Bank of Scotland Group Plc
4,104,874
7.9
6
FirstMerit Corp.
3,522,009
6.8
7
Fifth Third Bancorp
3,384,743
6.5
8
JPMorgan Chase & Co.
2,939,452
5.6
9
U.S. Bancorp
2,032,321
3.9
10
Dollar Bank Federal Savings Bank
1,701,264
3.3
14
F.N.B. Corporation
623,947
1.2
Pittsburgh, PA MSA
Rank
Institution
Total Deposits
($000)
Market
Share (%)
1
PNC Financial Services Group Inc.
47,062,720
56.5
2
Royal Bank of Scotland Group Plc
7,129,530
8.6
3
F.N.B. Corporation
3,867,847
4.6
4
Dollar Bank Federal Savings Bank
3,556,646
4.3
5
First Niagara Financial Group Inc.
2,762,262
3.3
6
Huntington Bancshares Inc.
2,512,422
3.0
7
First Commonwealth Financial Corp.
2,465,101
3.0
8
TriState Capital Holdings Inc.
1,940,243
2.3
9
S&T Bancorp Inc.
1,685,131
2.0
10
Northwest Bancshares Inc.
1,045,914
1.3
All Other FNB MSA's (excludes Pittsburgh, Baltimore, Cleveland)
Rank
Institution
Total Deposits
($000)
Market
Share (%)
1
PNC Financial Services Group Inc.
11,180,309
11.7
2
M&T Bank Corp.
7,288,461
7.6
3
F.N.B. Corporation
5,175,196
5.4
4
Wells Fargo & Co.
4,861,113
5.1
5
Banco Santander SA
4,056,694
4.2
6
Huntington Bancshares Inc.
3,875,653
4.0
7
Royal Bank of Scotland Group Plc
3,667,677
3.8
8
FirstMerit Corp.
3,419,084
3.6
9
Susquehanna Bancshares Inc.
2,947,480
3.1
10
JPMorgan Chase & Co.
2,631,476
2.7
MSA Market Share - Proven Success, Opportunity For Growth Established MSA Markets –
Proven Success, Leading Share Position Achieved
Recent Expansion MSA Markets – Opportunity for Growth
|
  Population
Rank
MSA
(000's)
#1
#2
#3
1
New York
(1)
19,567
JPM
BofA
Citi
2
Los Angeles
12,829
BofA
Wells Fargo
Mitsubishi UFJ
3
Chicago
9,461
JPM
BMO
BofA
4
Dallas
6,426
BofA
JPM
Wells Fargo
5
Philadelphia
5,965
BofA
Capital One
TD
6
Houston
5,920
JPM
Wells Fargo
BofA
7
Washington
(1)
5,636
Wells Fargo
Capital One
BofA
8
Miami
5,565
Wells Fargo
BofA
Citi
9
Atlanta
5,287
SunTrust
Wells Fargo
BofA
10
Boston
(1)
4,552
BofA
RBS
Banco Santander
11
San Francisco
4,335
BofA
Wells Fargo
Citi
12
Detroit
4,296
JPM
Comerica
BofA
13
Riverside
4,225
BofA
Wells Fargo
JPM
14
Phoenix
4,193
JPM
Wells Fargo
BofA
15
Seattle
3,440
BofA
Wells Fargo
U.S. Bancorp
16
Minneapolis
3,349
Wells Fargo
U.S. Bancorp
TCF
17
San Diego
3,095
Wells Fargo
Mitsubishi UFJ
BofA
18
St. Louis
(1)
2,788
U.S. Bancorp
BofA
Commerce
19
Tampa
(1)
2,783
BofA
Wells Fargo
SunTrust
20
Baltimore
2,710
BofA
M&T
PNC
21
Denver
2,543
Wells Fargo
JPM
FirstBank
22
Pittsburgh
(1)
2,356
PNC
RBS
23
Portland
2,226
BofA
U.S. Bancorp
Wells Fargo
24
Charlotte
2,217
BofA
Wells Fargo
BB&T
25
Sacramento
2,149
Wells Fargo
BofA
U.S. Bancorp
Top 3 Banks in MSA by Deposit Market Share
Unique #3 Position in a Major Market
18
Source: MSA population per U.S. Census Bureau 2010 data; Deposit market share per SNL
Financial as of June 30, 2013, pro-forma as of October 22, 2013 (1) Excludes
custodial bank F.N.B. Corporation
FNB is uniquely
positioned as
one of only very
few community
banks to hold a
Top 3 deposit
market rank in
one of the
nation’s 25
largest
metropolitan
statistical areas. |
 Significant Commercial Prospects
19
Note: Above metrics at the MSA level
(1)
Data per U.S. Census Bureau
(2)
Data per Hoover’s as of October 21, 2013
Significant Commercial Prospects Concentrated in Pittsburgh, Baltimore &
Cleveland Opportunity to Leverage Core Competency and Drive Sustained Organic
Growth (1)
(2)
Strong Concentration of Commercial Prospects
Over 175,000 Total Businesses
(1)
1,904
1,987
2,094
8,857
9,621
10,106
12,851
13,345
13,410
52,149
59,240
65,169
Youngstown MSA
Scranton MSA
Harrisburg MSA
Cleveland MSA
Pittsburgh MSA
Baltimore MSA
# of Business with Revenue >$1M
Total Businesses |
 20
Acquisition Strategy
Disciplined and Consistent Strategy
Significant Expansion
Enhanced Organic Growth Prospects |
 Acquisition
Strategy 21
Disciplined and Consistent Acquisition Strategy
Strategy
Disciplined identification and focus on markets that offer potential to
leverage core competencies and growth opportunities
Criteria
Create shareholder value
Meet strategic vision
Fit culturally
Evaluation
Targeted financial and capital recoupment hurdles
Proficient and experienced due diligence team
Extensive and detailed due diligence process
Execution
Superior post-acquisition execution
Execute FNB’s proven, scalable, business model
Proven success assimilating FNB’s strong sales culture
Experienced Acquirer
12th bank acquisition since 2002 announced June 2013 (BCSB)
Fourth consecutive acquisition in a major MSA
Five acquisitions since 2010
Ten acquisitions since 2005
Execution
Execution
Criteria
Criteria
Evaluation
Evaluation
Strategy
Strategy |
 22
Baltimore, MD MSA
Annapolis Bancorp, Inc -
Closed April 6, 2013
BCSB Bancorp, Inc. -
Target close February, 2014
Talent established
Team and leadership in place
Presence anchored
Downtown Baltimore headquarters announced
Performance tracking well
Loan production on target, pipelines healthy
Sales management processes fully deployed
Cleveland, Ohio MSA
PVF Capital Corp. –
Closed October 12, 2013
Team and leadership in place
Downtown Cleveland headquarters announced
Sales management process deployed
BCSB Locations
FNB Locations (including ANNB)
PVFC Locations
Continued Positive Progress Integrating Acquisitions
Team and Leadership Established
Regional Headquarters in Both Markets Announced
Results Tracking Well
Cleveland
Baltimore
Pittsburgh
Performance goals established
Presence anchored
Talent established
Recent Acquisitions – Positioning for Sustained Organic Growth |
 Expanded Franchise = Enhanced Organic Growth Prospects
23
Note: Market population and market businesses represent current metrics based on respective
FNB MSA presence Data per FNB, SNL Financial and/or U.S. Census Bureau
(Businesses) Acquisition-
Related
Expansion in
Higher Growth
Markets
Enhances
Organic Growth
Opportunities
In Millions |
 24
Strong Operating Results
3Q13 Highlights and Trends |
 3Q13 Financial Highlights –
Quarterly Trends
25
Current
Quarter
3Q13
Prior
Quarter
2Q13
Prior Year
Quarter
3Q12
Operating
Earnings
(1)
Net income ($ millions)
$32.2
$30.1
$29.9
Earnings per diluted share
$0.22
$0.21
$0.21
Profitability
Performance
ROTE
(1)
18.33%
17.33%
18.57%
ROTA
(1)
1.12%
1.08%
1.12%
Net interest margin
3.64%
3.63%
3.70%
Efficiency ratio
59.7%
58.6%
57.4%
Strong
Balance Sheet
Trends
(2)
Total loan growth
9.3%
5.6%
4.7%
Commercial loan growth
4.2%
5.8%
5.0%
Consumer loan growth
25.3%
11.8%
12.0%
Transaction
deposits
and
customer
repo
growth
(3)
7.0%
7.4%
8.7%
(1) Non-GAAP measure, refer to Appendix for GAAP to Non-GAAP Reconciliation details;
(2) Average, annualized linked quarter organic growth results. Organic growth
results exclude balances acquired in the ANNB acquisition 2Q13; (3) Total deposits excluding time deposits
|
 Balance Sheet Highlights
26
Average Balances,
$ in Millions
3Q13
Linked-Quarter
Growth
(1)
3Q13 Highlights
Balance
$
%
Securities
$2,275
-$20.7
-3.6%
Strong balance sheet growth, with continued
momentum growing loans and transaction
deposits
Growth in average total loans of $200.2 million
or 9.3% annualized
Growth in average transaction deposits and
customer repurchase agreements of $138.6
million or 7.0% annualized
Transaction deposit growth further enhanced
attractive deposit mix
Total loans
$8,730
$200.2
9.3%
Commercial loans
$4,783
$49.6
4.2%
Consumer
loans
(2)
$2,860
$171.5
25.3%
Residential mortgage loans
$1,043
-$22.2
-8.3%
Earning assets
$11,048
$161.6
5.9%
Total deposits and customer repos
$10,403
$68.9
2.6%
Transaction
deposits
and
customer
repos
(3)
$8,011
$138.6
7.0%
Time deposits
$2,392
-$69.7
-11.2%
(1) % growth annualized; (2) Includes Direct Installment, Indirect Installment and Consumer
LOC portfolios; (3) Excludes time deposits; (4) Period-end as of September 30,
2013 Growth driven by strong growth in
average non-interest bearing deposits
of $131.8 million or 27.5% annualized
Lower cost, relationship-based
transaction deposits and customer repurchase agreements
represent 78% of total
deposits and customer repurchase agreements compared to
74% at September 30, 2012
(4)
|
 Net
Interest Margin Trends 27
Net Interest Margin Trends
Relatively stable core net interest margin
The net interest margin has benefited from the consistent growth
in loans and transaction deposits
Active net interest management through Pricing Committee and Asset/Liability Committee
effective through focused efforts on managing interest rate risk strategy and margin
preservation 3Q13
net
interest
income
(FTE)
totaled
$101.0
million,
growing
$2.5
million,
or
2.6%,
linked
quarter,
and
$5.7
million,
or
5.9%,
compared to the prior year quarter
3.64%
3.63%
3.66%
3.66%
3.70%
2.00%
2.25%
2.50%
2.75%
3.00%
3.25%
3.50%
3.75%
4.00%
3Q13
2Q13
1Q13
4Q12
3Q12
Core Net Interest Margin
Accretable Yield Benefit |
 Asset Quality Results
(1)
28
$ in Thousands
3Q13
2Q13
3Q12
3Q13 Highlights
NPL’s+OREO/Total loans+OREO
1.49%
1.59%
1.69%
Total delinquency
1.44%
1.44%
1.66%
Provision for loan losses
(2)
$7,280
$7,903
$8,429
Net charge-offs (NCO’s)
(2)
$5,507
$7,325
$7,362
NCO’s/Total average loans
(2)
0.25%
0.34%
0.37%
NCO’s/Total average originated loans
0.26%
0.33%
0.42%
Allowance for loan losses/
Total loans
1.34%
1.35%
1.43%
Allowance for loan losses/
Total non-performing loans
127.37%
121.68%
120.23%
Solid
performance
with
metrics
remaining
at
good,
consistent
levels
Net charge-offs very low at 0.26% annualized
for the originated portfolio
Provision for loan losses of $7.3 million
exceeds net charge-offs in support of the
strong loan growth
Reserve position consistent with prior quarter
levels
NPL’s+OREO/Total loans +OREO improved
from the prior quarter and the year-ago quarter
Delinquency remained stable compared to the
prior quarter and improved from the year-ago
quarter
(1)
Metrics shown are originated portfolio metrics unless noted as a total portfolio metric.
“Originated portfolio” or “Originated loans” excludes loans
acquired at fair value and accounted for in accordance with ASC 805 (effective January 1,
2009), as the risk of credit loss has been considered by virtue of the
Corporation’s estimate of fair value.
(2)
Total portfolio metric
|
 Asset Quality Trends
29
NCO’s
Originated
Loans/
Total
Originated
Loans
(1)(3)
NPL’s+OREO/
Total
Originated
Loans+OREO
(1)(2)
Asset Quality Trends Compare Favorably to Peer Results
2.74%
2.15%
1.60%
1.59%
1.59%
1.49%
0.00%
0.50%
1.00%
1.50%
2.00%
2.50%
3.00%
3.50%
4.00%
2010
2011
2012
1Q13
2Q13
3Q13
FNB
Peer Group Median
0.77%
0.62%
0.41%
0.27%
0.00%
0.20%
0.40%
0.60%
0.80%
1.00%
1.20%
FY 2010
FY 2011
FY 2012
YTD 2013
FNB
Peer Group Median
Peer data per SNL Financial, refer to Appendix for peer listing; (1) Metrics shown are
originated portfolio. “Originated portfolio” or “Originated loans”
excludes loans acquired at fair value and accounted for in accordance with ASC 805 (effective January 1, 2009), as the risk of credit loss has
been considered by virtue of the Corporation’s estimate of fair value; (2) Based on
balances at quarter end for each period presented; (3) Full year or quarterly results
annualized. |
 Capital Position
30
Capital Position as of September 30, 2013
(1)
(1) Regulatory risked-based ratios estimated as of September 30, 2013.
12.1%
10.6%
8.4%
6.1%
12.1%
10.6%
8.4%
6.1%
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
12.0%
14.0%
Total Risk-Based
Tier One
Leverage
Tangible Common Equity
June 30, 2013
September 30, 2013 |
 31
Investment Thesis
Long-Term Investment Thesis |
 Long-Term Investment Thesis -
Return Focused
32
Long-Term Investment Thesis
Targeted EPS Growth
5-6%
Targeted Dividend Yield
(Targeted Payout Ratio 60-70%)
4-6%
Implied Total Shareholder Return
9-12%
FNB’s long-term investment thesis reflects a commitment to efficient capital management
and creating value for our shareholders |
 Operating Results Outperform Peers
33
ROTE
(1)
Efficiency Ratio
Net Interest Margin
Net Charge
Offs to Average Loans
-
The above represents full-year 2010, 2011, 2012 and/or quarterly, year-to-date
results where noted. Refer to Supplemental Information for peer group listing.
(1) Operating results, refer to Supplemental Information for details
|
 Consistent Operating Results
34
FNB = 85% Percentile
FNB = 94% Percentile
Data per FNB and/or SNL Financial
Refer to Supplemental Information for peer listing
FNB’s ability to deliver consistent operating results exceeds peer results
0.00%
0.05%
0.10%
0.15%
0.20%
0.25%
2013 Peer Median
FNB
ROAA Volatility
0.000%
0.005%
0.010%
0.015%
0.020%
0.025%
0.030%
0.035%
0.040%
0.045%
0.050%
2013 Peer Median
FNB
Revenue/Avg Assets Volatility
FNB and Peer Volatility (Standard Deviation 1Q10 – 3Q13)
|
 Attractive P/E Valuation Highlights Potential Upside
Market data per SNL Financial as of November 1, 2013. Refer to Supplemental Information
for regional peer listing. 35
Consistent premium to peers based on price
to tangible book value per share
FNB currently reflects an attractive
valuation based on future earnings
0.00x
0.50x
1.00x
1.50x
2.00x
2.50x
3.00x
3.50x
4.00x
11/01/10
11/01/11
11/01/12
11/01/13
FNB
2013 Group Peer Median
14.54x
15.36x
13.00x
13.50x
14.00x
14.50x
15.00x
15.50x
FNB
2013 Peer Median
Historical Price / TBV Per Share (x)
Price / 2014 EPS Estimate (x) |
 36
Transaction Overview
Successfully raised $151.2 million through a combination of common equity (4.7 million shares,
$54.5 million net proceeds, including over-allotment option exercised) and
preferred equity (4.0 million shares, $96.7 million net proceeds). Proactive Capital
Management Action Supports future growth opportunities and proactively positions F.N.B.
for Basel III implementation , including the redemption of
certain trust preferred securities
Demonstrated track record of robust loan growth (17 consecutive quarters of organic
growth) Positions FNB to redeem $131.5mm of existing trust preferred securities at a
weighted average cost of 4.33%² and
potential repayment of BCSB’s $16.5mm of trust preferred securities upon anticipated
closing of pending acquisition
Adds $151mm of fully Basel III-compliant capital to support future balance sheet
growth Strengthens/improves quality of capital under Basel III; Tier 1 common improves
~50bps to 9.1% Current rate environment presented opportunity to access permanent
capital at historically attractive levels Use of proceeds consistent with FNB’s
proactive and efficient capital management strategy Reported and Pro-Forma Capital
Ratios as of September 30, 2013³ 12.1%
12.2%
Total risk-based capital
Tier 1 leverage
TCE / TA
8.4%
8.5%
6.1%
6.5%
Tier 1 :
10.6%
Tier 1 :
10.7%
Tier 1
common
Non-
common
Tier 1
Tier 2
8.6%
9.1%
2.0%
1.6%
1.5%
1.5%
As Reported
Pro forma
As Reported
Pro forma
As Reported
Pro forma
¹Under Basel III Final rules, if a depository institution holding company under $15
billion makes an acquisition and the resulting organization has total consolidated assets of $15 billion or more, its non-
qualifying capital instruments also will be subject to the phase-out schedule (25%
includable in Tier 1 in 2015 and 0% includable in Tier 1 in 2016); ² Weighted average cost of redeemed trust preferred
securities assumes 3 month LIBOR of 0.24%; ³ Pro forma capital ratios do not include
impacts from PVF Capital and BCSB transactions; capital ratios shown on a Basel I basis
October 2013 Capital Actions – Proactive Capital Management 1
|
 37
Supplemental Information |
 38
Supplemental Information Index
Diversified Loan Portfolio
Deposits and Customer Repurchase Agreements
Investment Portfolio
Loan Risk Profile
Marcellus and Utica Shale Exposure
Regency Finance Company Profile
Regional Peer Group Listing
GAAP to Non-GAAP Reconciliation
Third Quarter 2013 Earnings Release (October 17, 2013) |
 Diversified Loan Portfolio
39
Note: Balance, CAGR and % of Portfolio based on period-end balances
9/30/2013
CAGR
% of Portfolio
($ in millions)
Balance
12/08-
9/30/13
12/31/08
9/30/13
C&I
$1,755
13.9%
16%
20%
CRE: Non-Owner Occupied
1,555
11.4%
16%
17%
CRE: Owner Occupied
1,317
5.9%
17%
15%
Commercial Leases
142
32.7%
1%
2%
Total Commercial
$4,769
10.9%
50%
54%
Consumer Home Equity
2,042
11.6%
21%
23%
Residential Mortgage
987
12.0%
10%
11%
Indirect
624
4.4%
9%
7%
Other
192
4.5%
3%
2%
Regency
175
2.2%
2%
2%
Florida
49
-31.4%
5%
<1%
Total Loan Portfolio
$8,837
9.2%
100%
100%
Well diversified portfolio
Strong growth results driven by commercial loan growth
$8.8 Billion Loan Portfolio
September 30, 2013
C&I + Owner Occupied CRE =
35% of Total Loan Portfolio
Commercial &
Industrial 20%
Consumer
Home Equity
23%
Residential
Mortgage 11%
Other 2%
Regency 2%
Florida 0%
Commercial
Leases 2%
CRE: Non
Owner
Occupied 17%
CRE: Owner
Occupied 15%
Indirect 7% |
 Deposits and Customer Repurchase Agreements
40
Note: Balance, CAGR and % of Portfolio based on period-end balances; (1) Transaction
deposits include savings, NOW, MMDA and non-interest bearing deposits; (2) December
31, 2008 through September 30, 2013 9/30/2013
CAGR
Mix %
($ in millions)
Balance
12/08-
9/13
12/31/08
9/30/13
Savings, NOW, MMDA
$4,981
12.8%
44%
47%
Time Deposits
2,360
0.4%
36%
22%
Non-Interest Bearing
2,116
19.2%
14%
20%
Customer Repos
1,101
22.8%
6%
11%
Total Deposits and
Customer Repo Agreements
$10,558
10.9%
100%
100%
Transaction Deposits
(1)
and
Customer Repo Agreements
$8,198
15.4%
64%
78%
Loans to Deposits and Customer Repo Agreements Ratio =
84% at September 30, 2013
New client acquisition and relationship-based focus reflected in favorable deposit
mix –
15.4% average growth for transaction deposits and customer repo agreements
(2)
–
78% of total deposits and customer repo agreements are transaction-based deposits
(1)
$10.6 Billion Deposits and
Customer Repo Agreements
September 30, 2013
Non-Interest
Bearing 20%
Savings, NOW,
MMDA 47%
Customer
Repos 11%
Time Deposits
22% |
 %
Ratings
($ in millions
(1)
)
Portfolio
Investment %
Agency MBS
$878
37%
AAA
100%
CMO Agency
831
35%
AAA
100%
Agency Senior Notes
376
16%
AAA
100%
Municipals
153
7%
AAA
AA
A
BBB
2%
50%
47%
1%
Trust Preferred
(2)
35
1%
BBB
BB
B
CCC
Ca
C
5%
13%
12%
8%
2%
60%
Short Term
49
2%
AAA
100%
CMO Private Label
9
1%
AA
A
BBB
BB
23%
12%
34%
31%
Corporate
10
1%
A
100%
Bank Stocks
2
-
Non-Rated
Commercial MBS
2
-
AAA
100%
US Treasury
1
-
AAA
100%
Total Investment Portfolio
$2,346
100%
Investment Portfolio
41
(1) Amounts reflect GAAP; (2) Original cost of $ 104 million, adjusted cost of $43 million,
fair value of $35 million Highly Rated $2.3 Billion Investment Portfolio
September 30, 2013
Ratings
Composition
AAA, 91.2%
AA, 3.3%
A, 3.5%
BBB,BB,B
Non-
Rated
Available for
Sale, 49%
Held to
Maturity, 51%
CCC,CC,Ca,C
2%
–
Highly rated with an average rating of AA and 99%
of the portfolio rated A or better
–
General obligation bonds = 99.0% of portfolio
–
78.0% from municipalities located throughout
Pennsylvania
Relatively low duration of 3.4
Portfolio comprised of 49% AFS and 51% HTM
Municipal bond portfolio
95% of total portfolio rated AA or better, 98% rated A
or
better |
 42
Loan Risk Profile
(1)
Originated portfolio metric
$ in millions
Balance
9/30/2013
% of Loans
NPL's/Loans
(1)
YTD Net Charge-
Offs/Loans
(1)
Total Past
Due/Loans
(1)
Commercial and Industrial
$1,755
19.9%
0.48%
0.22%
0.75%
CRE: Non-Owner Occupied
1,555
17.6%
1.04%
0.24%
1.25%
CRE: Owner Occupied
1,317
14.9%
2.02%
0.08%
2.32%
Home Equity and Other Consumer
2,181
24.7%
0.48%
0.20%
0.88%
Residential Mortgage
987
11.2%
1.22%
0.11%
2.63%
Indirect Consumer
624
7.1%
0.16%
0.35%
1.00%
Regency Finance
175
2.0%
4.09%
3.72%
3.75%
Commercial Leases
142
1.6%
0.55%
0.16%
1.14%
Florida
49
0.6%
22.14%
-2.17%
22.14%
Other
53
0.6%
0.00%
2.31%
0.11%
Total
$8,837
100.0%
1.05%
0.27%
1.44% |
 Marcellus and Utica Shale Exposure
43
(1)
Sources: www.marcellus.psu.edu, retrieved May 3, 2013; (2) www.dnr.state.oh.us, retrieved June
5, 2013; (3) Sterne Agee June 7, 2010 and FBR Capital Markets, March 2, 2011.
Ohio
FNB PA/OH Banking Locations
Pennsylvania
Ohio
FNB is well-positioned in the Marcellus Shale and Utica
Shale regions with a Pennsylvania footprint that closely
aligns with the Marcellus Shale concentration and
exposure to the Utica Shale region in Ohio.
FNB has been noted by analysts as being one of the
best geographically positioned banks to benefit from
the Marcellus Shale.
(3)
Ohio Utica Shale
(2)
FNB branch map per SNL Financial |
 Marcellus and Utica Shale FNB Strategic Focus
44
Opportunity for FNB relates to potential indirect and induced economic benefits across
footprint Direct Effect:
Oil and Gas
Directly associated with the extraction, processing and delivery
of the gas
Drilling, extraction and support activities
Indirect Effect:
Supply Chain
Provides goods and services to the energy industry
e.g.: Iron and steel, transportation, commodity traders,
heavy equipment, surveyors, utilities, rig parts, attorneys,
real estate, machinery manufacturers, etc.
Induced Benefit:
Consumption
Resulting benefit to industries and individuals from positive
direct and indirect effects
e.g.: Higher education, travel, housing, food and drink,
entertainment, utilities, etc.
FNB
Strategic Focus:
Supply Chain and
Consumption |
 Consumer
finance
business
with
over
80
years
of
consumer
lending
experience
Credit quality: 3Q13 YTD net charge-offs to average loans of 3.71%
Returns: 3Q13 YTD: ROA 3.89%, ROE 42.00%, ROTE 47.16%
Regency Finance Company Profile
(1)
Return on average tangible common equity (ROTCE) is calculated by dividing net
income less amortization of intangibles by average common equity less
average intangibles. 45
72 Locations
Spanning Four
States
Regency Finance Company
$175 Million Loan Portfolio
86% of Real Estate Loans are First Mortgages
60%
26%
14%
Direct
Real Estate
Sales Finance
Ohio
Kentucky
Tennessee
Pennsylvania |
 Regional Peer Group Listing
46
Ticker
Institution
Ticker
Institution
ASBC
Associated Bancorp
ONB
Old National Bancorp
AF
Astoria Financial Corporation
PVTB
Private Bancorp, Inc.
CBSH
Commerce Bancshares, Inc.
SUSQ
Susquehanna Bancshares, Inc.
FMER
First Merit Corp.
UMBF
UMB Financial Corp.
FULT
Fulton Financial Corporation
VLY
Valley National Bancorp
MBFI
MB Financial, Inc
WBS
Webster Financial Corporation
NPBC
National Penn Bancshares, Inc.
WTFC
Wintrust Financial Corporation |
 GAAP to Non-GAAP Reconciliation
47
Operating: Earnings, Return on Avg Tangible Equity, Return on Avg Tangible
Assets September 30, 2013
June 30, 2013
March 31, 2013
September 30, 2012
2012
2011
2010
Operating net income
Net income
$31,634
$29,193
$28,538
$30,743
$110,410
$87,047
$74,652
Add: Merger and severance costs, net of tax
593
1,915
229
57
5,203
3,238
402
Add: Litigation settlement accrual, net of tax
-
-
-
-
1,950
-
-
Add: Branch consolidation costs, net of tax
-
-
-
-
1,214
-
-
Less: Gain on extinguishment of debt, net of tax
-
(1,013)
-
-
-
-
-
Less: Gain on sale of building, net of tax
-
-
-
(942)
(942)
-
-
Less: One-time pension expense credit
-
-
-
-
-
-
(6,853)
Operating net income
$32,227
$30,095
$28,767
$29,858
$117,835
$90,285
$68,201
Operating diluted earnings per share
Diluted earnings per share
$0.22
$0.20
$0.20
$0.22
$0.79
$0.70
$0.65
Add: Merger and severance costs, net of tax
0.00
0.02
0.00
0.00
0.04
0.02
0.00
Add: Litigation settlement accrual, net of tax
-
-
-
-
0.01
-
-
Add: Branch consolidation costs, net of tax
-
-
-
-
0.01
-
-
Less: Gain on extinguishment of debt, net of tax
-
(0.01)
-
-
-
-
-
Less: Gain on sale of building
-
-
-
(0.01)
(0.01)
-
-
Less: One-time pension expense credit
-
-
-
-
-
-
(0.05)
Operating diluted earnings per share
$0.22
$0.21
$0.20
$0.21
$0.84
$0.72
$0.60
Operating return on average tangible equity
Operating net income (annualized)
$127,858
$120,706
$116,668
$118,784
$117,835
$90,285
$68,201
Amortization of intangibles, net of tax (annualized)
5,455
5,538
5,237
5,798
5,938
4,698
4,364
$133,313
$126,244
$121,904
$124,582
$123,773
$94,983
$72,565
Average shareholders' equity
$1,475,751
$1,473,945
$1,410,827
$1,385,282
$1,376,493
$1,181,941
$1,057,732
Less: Average intangible assets
748,592
745,458
712,466
714,501
717,031
599,851
564,448
Average tangible equity
$727,159
$728,487
$698,361
$670,781
$659,462
$582,089
$493,284
Operating return on average tangible equity
18.33%
17.33%
17.46%
18.57%
18.77%
16.32%
14.71%
Operating return on average tangible assets
Operating net income (annualized)
$127,858
$120,706
$116,668
$118,784
$117,834
$90,285
$68,201
Amortization of intangibles, net of tax (annualized)
5,455
5,538
5,237
5,798
5,938
4,698
4,364
$133,313
$126,244
$121,904
$124,582
$123,772
$94,983
$72,565
Average total assets
$12,615,338
$12,470,029
$12,004,759
$11,842,204
$11,782,821
$9,871,164
$8,906,734
Less: Average intangible assets
748,592
745,458
712,466
714,501
717,031
599,851
564,448
Average tangible assets
11,866,746
$
11,724,570
$
11,292,292
$
11,127,704
$
11,065,789
$
9,271,313
$
8,342,286
$
Operating return on average tangible assets
1.12%
1.08%
1.08%
1.12%
1.12%
1.02%
0.87%
For the Quarter Ended
For the Year Ended |