EX-99.1 2 exhibit.htm exhibit.htm
Investor Presentation
Data as of June 30, 2012
Ticker Symbol: FULT (NASDAQ)
 
 
 
§ This presentation may contain forward-looking statements with respect to Fulton Financial Corporation’s financial
 condition, results of operations and business. Do not unduly rely on forward-looking statements. Forward-looking
 statements can be identified by the use of words such as “may,” “should,” “will,” “could,” “estimates,” “predicts,”
 “potential,” “continue,” “anticipates,” “believes,” “plans,” “expects,” “future,” “intends” and similar expressions which are
 intended to identify forward-looking statements.
§ Forward-looking statements are not guarantees of future performance and are subject to risks and uncertainties, some
 of which are beyond the Corporation’s control and ability to predict, that could cause actual results to differ materially
 from those expressed in the forward-looking statements. The Corporation undertakes no obligation, other than as
 required by law, to update or revise any forward-looking statements whether as a result of new information, future
 events or otherwise.
§ Many factors could affect future financial results including, without limitation: the impact of adverse changes in the
 economy and real estate markets; increases in non-performing assets which may reduce the level of earning assets
 and require the Corporation to increase the allowance for credit losses, charge-off loans and incur elevated collection
 and carrying costs related to such non-performing assets; acquisition and growth strategies; market risk; changes or
 adverse developments in political or regulatory conditions; a disruption in, or abnormal functioning of, credit and other
 markets, including the lack of or reduced access to markets for mortgages and other asset-backed securities and for
 commercial paper and other short-term borrowings; changes in the levels of, or methodology for determining, FDIC
 deposit insurance premiums and assessments; the effect of competition and interest rates on net interest margin and
 net interest income; investment strategy and other income growth; investment securities gains and losses; declines in
 the value of securities which may result in charges to earnings; changes in rates of deposit and loan growth or a decline
 in loans originated; relative balances of rate-sensitive assets to rate-sensitive liabilities; salaries and employee benefits
 and other expenses; amortization of intangible assets; goodwill impairment; capital and liquidity strategies; and other
 financial and business matters for future periods.
§ For a more complete discussion of certain risks and uncertainties affecting the Corporation, please see the sections
 entitled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations”
 set forth in the Corporation’s filings with the Securities and Exchange Commission.
Forward-Looking Statements
2
 
 
 
About Us
§ Mid-Atlantic financial holding company
§ 6 community banks / 5 states
§ Fulton Financial Advisors
§ Fulton Mortgage Company
§ 270 community banking offices
§ Asset size: $16.3 billion
§ 3,800 team members
§ Market capitalization: $ 2.0 billion
§ Book value per common share: $ 10.16
§ Tangible book value per common share: $ 7.46
§ Shares outstanding: 200.9 million
3
 
 
 
§ 1. EPS Growth
§ 2. ROA Improvement
§ 3. Spread Management /Net Interest Margin
§ 4. Improve Asset Quality
§ 5. Deploy Capital Prudently
§ 6. Leverage Market Opportunities
§ 7. Profitable Organic / Acquisitive Growth
Corporate Goals and Priorities
4
 
 
 
Goals and Priorities
1. Earnings per Share Growth
üQ2/12 Diluted EPS: 20 cents
Up 5.3% linked quarter (19 cents)
Up 11.1% year over year (18 cents)
5
 
 
 
Income Statement Summary
6
 
 
 
Income Statement Summary
(Six Months Ended June 30th)
7
 
 
 
Ending Loans
8
 
 
 
Diluted EPS
9
 
 
 
10
CAGR = 6.7%
 
 
 
Non-Interest Income
11
 
 
 
12
Non-Interest Income
(Six Months Ended June 30th)
 
 
 
Non-Interest Income Growth
§ Fulton Mortgage Company
 § Significant Contributor to Non-interest Income
 § Strong Pipeline with Low Rate Environment
 § Leverage our Market Reputation and Brand
 § Expanded Origination Staff
§ Fulton Financial Advisors ($4.0 billion A.U.M.)
 § Brokerage Production Mix (non-recurring / recurring)
 § Referrals from Commercial Bank
 § Team Market Development
13
 
 
 
Fulton Mortgage Company
§ Applications up linked quarter: $824
 million from $812 million
§ Pipeline $520 million vs. $428 million
 (Q2/12 vs. Q1/12)
§ 39% purchase / 61% refinancing
 (Q2/12)
§ Sales gains up linked quarter
14
 
 
 
Fulton Mortgage Company
78%
Availabl
e for
Sale
GOS
Spread
1.42%
GOS
Spread
1.30%
GOS
Spread
1.55%
GOS
Spread
1.66%
84%
Available
for Sale
83%
Available
for Sale
71%
Availabl
e for
Sale
86%
Available
for Sale
GOS
Spread
1.58%
69%
Availabl
e for
Sale
($ in thousands)
 
 
 
Non-Interest Expenses
16
 
 
 
1. Enterprise-wide Risk Management
 and Compliance
 
2. Core Platform Conversion
(Continuation of longstanding Fiserv Relationship)
3. Asset Quality Improvement
Priority Resource Commitments
17
 
 
 
International Bancshares Corp.
People’s United Financial, Inc.
Susquehanna Bancshares, Inc.
Synovus Financial Corporation
TCF Financial Corporation
UMB Financial Corporation 
Valley National Bancorp
Webster Financial Corporation
*Fulton’s peer group as of June 30, 2012
Associated Banc-Corp
BancorpSouth, Inc.
BOK Financial Corporation  
City National Corporation
Commerce Bancshares, Inc. 
Cullen / Frost Bankers, Inc. 
First Horizon National
Corporation
FirstMerit Corporation
First Niagara Financial Group, Inc.
 
Peer Group*
18
 
 
 
More Efficient Than Peers
19
* Comprised of the 50 largest publicly traded domestic banks/thrifts in asset size as of
December 31, 2011. Excludes credit card companies. Source : SNL.com
 
 
 
2. Improve Our Return on Assets
üQ2/12: 0.98%
YTD 6/30/12: 0.96%
Goals and Priorities
20
 
 
 
ROA Growth
21
 
 
 
ROA and Assets, by Bank
22
 
 
 
§ 3. Spread Management / Net Interest
 Margin
§ Q2/12: 3.78%
ü Cost of interest bearing liabilities: 0.93%
ü Yield on earning assets: 4.48%
Goals and Priorities
23
 
 
 
Net Interest Margin
24
 
 
 
6 month cumulative gap: 1.10
Interest Rate Shocks (6/30/12)
Rate Change NII Change (Annual)  % Change
 
 +400 bp  + $ 70.5 million  + 13.0%
 +300 bp  + $ 49.6 million  + 9.1%
 +200 bp  + $ 28.2 million  + 5.2%
 +100 bp   + $ 8.2 million  + 1.5%
 - 100 bp  - $ 17.1 million  - 3.1%
25
 
 
 
Deposit Composition
26
 
 
 
§ 4. Improve Asset Quality
Goals and Priorities
27
 
 
 
28
 
 
 
Allowance for Loan Losses to Loans
29
 
 
 
Non-performing Loans* (6/30/12)
30
 
 
 
Loan Delinquency
31
 
 
 
Construction Exposure
Construction Loans /
Total Loans
10.5%
8.2%
6.7%
5.1%
5.2%
32
 
 
 
33
Provision for Credit Losses
 
 
 
§ 5. Deploy Capital Prudently
Goals and Priorities
34
 
 
 
Total Risk-Based Capital Ratio
35
 
 
 
Capital Adequacy (6/30/12)
36
 
 
 
Capital Adequacy vs. Basel III
37
 
 
 
Tangible Book Value Per Share
38
CAGR = 10.9%
 
 
 
Price Multiple vs. Peer Group
39
Note: As of 8/06/2012
 
 
 
Deploying Capital
 § Current Uses
 § Support organic growth
 § Increase our cash dividend
 § Stock repurchase
 § Potential Uses
 § Acquisitions with right opportunities
40
 
 
 
FULT - Cash Dividend and Yield
41
CAGR (cash dividend) = 29.8%
 
 
 
§ Program authorized: June 2012
§ Initial shares purchased: July 2012
§ Up to 5 million shares through 12/31/12
§ About 2.5% of outstanding shares
§ Shares repurchased as of market close
 August 8, 2012: 859,534
§ Average purchase price: $ 9.37
Stock Repurchase Program
42
 
 
 
§ 6. Leverage Market Opportunities
Goals and Priorities
43
 
 
 
Superior Customer Experience
CARE,
LISTEN,
UNDERSTAND
and
DELIVER
44
 
 
 
§ Top 3 Box Satisfaction:   84%
§ Delivery on our Promise:
 Top 3 Box      85%
*Survey Sample Size: 4,897 customers
Retail Customer Satisfaction*
45
 
 
 
§ Commercial Households:
 § Up 2.9% YTD (5.8% annualized)
§ Retail Households:
 § Up 1.6% YTD (3.2% annualized)
§ Net Household Lift:
 § Up 1.7% YTD (3.4% annualized)
New Household Growth YTD
46
 
 
 
§ Counties ranked #1 in deposit market share
 § Lebanon, PA (Fulton Bank 31.2%)
 § Snyder, PA (Swineford National Bank 30.3%)
 § Salem, NJ (Fulton Bank of New Jersey 27.2%)
§ Counties ranked #2 in deposit market share
 § Lancaster, PA (Fulton Bank 22.7%)
 § Montour, PA (FNB Bank 29.5%)
 § Gloucester, NJ (Fulton Bank of New Jersey 13.2%)
 § Washington, MD (The Columbia Bank 19.7%)
§ Counties ranked #3 in deposit market share
 § Northampton, PA (Lafayette Ambassador Bank 14.3%)
 § Warren, NJ (Fulton Bank of New Jersey 11.0%)
 § Howard, MD (The Columbia Bank 10.9%)
Top County Market Share (6/30/11)
47
 
 
 
§ 7. Profitable Organic /
 Acquisitive Growth
Goals and Priorities
48
 
 
 
A Valuable Franchise
49
 
 
 
2012 Branch Expansion
50
 
 
 
§ Optimal asset size: $ 500 million to
 $2.5 billion (102 banks in footprint)
§ Good fit geographically
§ Earnings accretive /reasonable
 tangible book dilution
§ Culturally compatible
§ Acceptable risk profile
§ Meaningful existing market share
Acquisitive Growth
51
 
 
 
Fulton Financial Corporation
One Penn Square
Lancaster, PA 17602
www.fult.com
Version 2012-08-13
 
 
 
Supplemental Information
 
 
 
Average Deposits
54
 
 
 
Interest Rates
 
 
 
Projected CD Maturities
 
56
 
 
 
Average Loans
57
 
 
 
§ 57 relationships with commitments to lend $20
 million or more
§ Maximum individual commitment: $39 million
§ Maximum commitment to any builder/developer:
 $28 million
 § Maximum commitment to any one development project:
 $15 million
§ Average commercial lending relationship size is
 $470,776
§ Loans and corresponding relationships are within
 Fulton’s geographic market area
Summary of Larger Loans (6/30/12)
58
 
 
 
59
 
 
 
Net Charge-offs              (YTD June 2012)
60
 
 
 
61
 
 
 
Allowance for Loan Losses to Non-accrual Loans
62
 
 
 
Commercial Loans by Industry
63
 
 
 
Loan Distribution by State (6/30/12)
64
 
 
 
Residential Mortgages (6/30/12)
65
 
 
 
Residential Mortgage Repurchase Activity
First & Second Quarter:
§2012 - Servicing Retained
 §  Repurchased  $ 3,550,000.
§2012 - Servicing Released
 §  Repurchased  $   610,000.
66
 
 
 
C&I Loans (6/30/12)
67
 
 
 
Commercial Real Estate Loans (6/30/12)
68
 
 
 
Construction Loans (6/30/12)
69
 
 
 
Construction Loans by Type (6/30/12)
70
 
 
 
Shared National Credits  (6/30/12)
71
 
 
 
72
Note: Excludes non-accrual TDRs
 
 
 
Investment Portfolio (06-30-12)
73
Book Yield (monthly) 3.49%
 
 
 
Projected Investment Security Cash Flows
 
74
 
 
 
Investment MBS & CMO Cash Flows (2011-2012)
 
75
Book Price
$101.51
Book Price
$101.87
Book Price
$101.48
Book Price
$102.12
 
 
 
Investment Portfolio - Transactions (2ND Quarter 2012)
 
($ in Thousands)
76
 
 
 
Projected FHLB Advance Maturities
 
77
 
 
 
Fulton Financial Corporation
One Penn Square
Lancaster, PA 17602
www.fult.com
Version 2012-08-13