EX-99.1 2 exhibit99.htm PRESENTATION exhibit99.htm
Keefe, Bruyette & Woods
2012 Regional Bank Conference
February 29, 2012
 
 
 
Forward Looking Statements &
Additional Information
This presentation may contain, and during this presentation our management may make statements that may constitute
“forward-looking statements” within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act
of 1995. Forward-looking statements are not historical facts but instead represent only our beliefs regarding future events,
many of which, by their nature, are inherently uncertain and outside our control. Forward-looking statements include, among
other things, statements regarding our financial performance, business prospects, future growth and operating strategies,
objectives and results. Actual results, performance or developments could differ materially from those expressed or implied by
these forward-looking statements. Important factors that could cause actual results to differ from those in the forward-looking
statements include, among others, those discussed in our Annual Report on Form 10-K, the preliminary prospectus supplement
and other reports filed with the Securities and Exchange Commission, copies of which will be made available upon request.
With the exception of fiscal year end information previously included in the audited financial statements in our Annual Report
on Form 10-K, the information contained herein is unaudited. Except as required by law, we undertake no duty to update the
contents of this presentation after the date of this presentation.
The Company’s accounting and reporting policies conform to U.S. generally accepted accounting principles (“GAAP”) and
general practice within the banking industry. As a supplement to GAAP, the Company has provided non-GAAP performance
results. The Company believes that these non-GAAP financial measures are useful because they allow investors to assess the
Company’s operating performance. Although the non-GAAP financial measures are intended to enhance investors’
understanding of the Company’s business and performance, these non-GAAP financial measures should not be considered an
alternative to GAAP.
2
 
 
 
Presentation Index
  Who We Are
  Operating Performance
  Credit and Capital
  Going Forward
3
 
 
 
Who Are We
4
 
 
 
Overview Of First Midwest
Note: Information as of December 31, 2011.
1 Includes $261mm in covered loans stemming from three FDIC-assisted transactions since September 30, 2009.
2 Source: SNL Financial. Non-downtown ranking and market share based on total deposits in Chicago MSA less deposits in the city of Chicago. Data as of June 30, 2011 reflects acquisitions
     post June 30, 2011.
3Defined as total deposits less time deposits.
  Headquartered In Suburban Chicago
  $8.0bn Assets
  $5.3bn Loans1
  $6.5bn Deposits
  74% Transactional3
  $5.0 bn AUM Wealth Management
  $73mm Avg Deposits Per Branch
  #8 in Market Share in Non-
 Downtown Chicago MSA2
 
5
 
 
 
6
 
 
 
Operating Performance
7
 
 
 
Significant Fourth Quarter Events
  Organizational Realignment
  Elimination Of Approximately 100 Positions
  Resulted In Severance-Related Costs Of $2.0 Million
  Redeemed $193.0 Million Of TARP Preferred Shares
  Redeemed Related Common Stock Warrant
  Resulted In One-time, $1.5 Million/$0.02 Per Share 4Q Charge
  Eliminates Preferred Dividends Of $10.3 Million Annually
  Acquired $106.7 Million In Deposits
  Approximately $70 Million Of Core Deposits
  Resulted In A Gain Of $1.1 Million
8
 
 
 
 
 
Quarters Ended
 
 
Years Ended
 
 
 
December 31,
 
 
December 31,
 
 
 
2011
2010
Change
 
2011
2010
Change
 
 
 
 
 
 
 
 
 
Net Income
 
$ 6.9
$  (28.2)
NA
 
$ 36.6
$  (9.7)
NA
 
 
 
 
 
 
 
 
 
PTPP Core Operating Earnings2
 
$  32.9
$ 35.0
(6%)
 
$ 131.1
$ 136.4
(4%)
 
 
 
 
 
 
 
 
 
Total Fee Based Revenue
 
$ 23.9
$ 22.4
7%
 
$ 94.2
$ 86.8
9%
 
 
 
 
 
 
 
 
 
Net Interest Margin
 
3.95%
4.02%
(2%)
 
4.04%
4.13%
(2%)
 
 
 
 
 
 
 
 
 
Efficiency Ratio
 
61.42%
59.08%
4%
 
61.29%
58.84%
4%
Improved Overall Earnings
Stable Core And Margin
1Dollar amounts in millions.
2PTPP represents Pre-Tax, Pre-Provision earnings, which is a non-GAAP financial measure. For reconciliation to GAAP measure, please refer to the appendix.
Performance Highlights
Key Operating Metrics1
9
 
 
 
 
 
As Of
 
 
 
 
December 31,
 
Change
 
 
2011
2010
 
YoY
 
 
 
 
 
 
Loans, End Of Period2
 
$ 5,349
$ 5,472
 
(2%)
 
 
 
 
 
 
YTD Avg.  Core Transactional
Deposits3
 
$ 4,755
$ 4,322
 
10%
 
 
 
 
 
 
Tier 1 Common
 
10.26%
9.81%
 
5%
 
 
 
 
 
 
YTD Charge-Offs
 
$ 103.7
$  147.1
 
(30%)
 
 
 
 
 
 
NPAs + 90 Days Past Due4
 
$  248.4
$  269.5
 
(8%)
 
 
 
 
 
 
Loans 30-89 Days Past Due
 
$ 27.5
$ 23.6
 
17%
Performance Highlights
Balance Sheet Metrics1
Strong Capital And Liquidity
Credit Metrics Improving
1Dollar amounts in millions.
2Includes covered loans acquired from FDIC-assisted transactions totaling $261 million and $372 million as of 31-Dec-11 and 31-Dec-10, respectively.
3Defined as total deposits less time deposits.
4Excludes covered loans.
10
 
 
 
Core Business Is Solid
²This is a non-GAAP financial measure. For reconciliation to GAAP measure, please refer to the appendix.
³Chicago Peers based on median of MBFI, PVTB, TAYC, and WTFC.
4National Peers based on median of SRCE, CHFC, CRBC, FCF, FMER, MBFI, ONB, PNFP, PVTB, PFS, STSA, SUSQ, UMBF, UMPQ, TAYC, TCBI, TRMK, VLY, WSBC, and WTFC.
Net Interest Margin
Efficiency Ratio1
11
 
 
 
12
Dollar amounts in millions.
1 Based on quarterly average deposit mix as of December 31, 2011.
Strong Deposit Mix1
Total Deposits = $6.6bn
 
 
 
Credit and Capital
 
 
 
  Branch originated
  Home equity dominated
  ~95% in footprint
  83% of portfolio, 51% CRE
  Diversified + granular
  Most have personal guarantees
  36% of CRE is owner-occupied
Consumer Loans = $660mm
Commercial Loans = $4.4bn
Total Loans = $5.3bn
Note: Loan data as of December 31, 2011.
Covered Loans = $261 mm
  Performing Better Than Originally Expected
  Losses Mitigated By Loss-Share
14
 
 
 
 
Dec. 31
 
% of
 
Dec. 31
 
% of
 
%
Loan Type1
2011
 
Total
 
2009
 
Total
 
Chg.
Commercial and Industrial
$  1,458
 
29%
 
$ 1,438
 
28%
 
1%
Agricultural
 244
 
5%
 
 210
 
4%
 
16%
Office, Retail, Industrial
 1,299
 
26%
 
 1,213
 
23%
 
7%
Multi-Family
 288
 
6%
 
 334
 
6%
 
(14%)
Residential Construction
 106
 
2%
 
 314
 
6%
 
(66%)
Commercial Construction
 145
 
3%
 
 231
 
4%
 
(37%)
Other Commercial Real Estate
 888
 
17%
 
 799
 
15%
 
11%
Subtotal Commercial
 4,428
 
87%
 
 4,539
 
87%
 
(2%)
 
 
 
 
 
 
 
 
 
 
1-4 Family Mortgages
 201
 
4%
 
 140
 
3%
 
44%
Consumer
 459
 
9%
 
 524
 
10%
 
(12%)
Total
$ 5,088
 
100%
 
$ 5,203
 
100%
 
(2%)
Greater Commercial And Owner-Occupied CRE
Reduced Construction, Re-entry To 1-4 Family
Changing Loan Mix
Note: Excludes covered loans acquired in FDIC-assisted transactions.
1 Dollar amounts in millions.
15
 
 
 
Significant Credit Improvement
Strong Capital, Proactive Remediation
($ in millions)
NPAs + 90s / TCE + LLR
54.9%
32.2%
34.7%
27.8%
31.0%
16
 
 
 
 Source: Company data and SNL Financial.
 1FMBI as of December 31, 2011, Peer data as of September 30, 2011.
 2Data as of December 31, 2011
 3Chicago Peers based on median of MBFI, PVTB, TAYC and WTFC.
 4National Peers based on median of SRCE, CHFC, CRBC, FCF, FMER, MBFI, ONB, PNFP, PVTB, PFS, STSA, SUSQ, UMBF, UMPQ, TAYC, TCBI, TRMK, VLY, WSBC, and WTFC.
NPA + 90 / TCE + LLR2
Strong Capital Foundation
First Midwest vs. Peers
17
 
 
 
TARP Redemption Completed
Overview
  Redeemed $193 million of preferred stock and
 outstanding warrant
  One-time, $1.5 million/$0.02 per share 4Q charge
  Eliminates preferred dividends of $10.3 million, or $0.08 per share
 annually, net of additional borrowing costs
  Recognizes credit and operating performance
  Funded through senior notes and cash on hand
  $115 million, 5 year notes @ 5.875%
  No equity component
 Advantageous To Shareholders
 Maintains Capital Flexibility
18
 
 
 
Going Forward
 
 
 
 Remediate Liquidate & Originate Originate
 Positioning
 FDIC FDIC & M&A M&A
 Defensive Offensive
20
 
 
 
Priorities Refocusing, Improving Execution
Delivering On Multiple Fronts
1. Asset Formation
3. Efficiency
2. Fee Income/Deposits
4. Investment In Core
  New Mortgage Sales Platform
  Asset-Based Lending Team
  Commercial Sales Team
  Wealth Management
  Core Deposit Growth
  Organizational Realignment
  Remediation Costs
  Market Entry - Downtown Chicago, DuPage
  Internet And ATM Platform
  High Customer And Employee Satisfaction
21
 
 
 
Market Disruption
  Environment Creates Opportunities
 
  In Greater Chicago Area
  ~ 30 Failures Since Start Of 2009
  ~ 40 Institutions ($19 Billion) With Texas Ratio > 100%
  Well Positioned To Benefit
  Strong Capital Position
  Solid Reputation: In Marketplace 70+ Years
  Expanded Sales Force
  Experienced Management
22
 
 
 
  Selective Criteria
  Ability To Strengthen The Company
 
  Leverages Our Skills
  Local Market Knowledge
  Core Competency
  Experienced And Successful Acquirer
  7 Deals, $2.9bn Since 2003
 
  FDIC-Assisted Deals Becoming More Competitive
  Deals Likely Smaller
  Eventual Shift From Assisted To Unassisted
Acquisition Opportunities
23
 
 
 
Why Invest in First Midwest…
  Premier Community Banking Franchise
  Investing in Our Business
  Working Through Cycle
  Solid Capital; Liquidity
  Experienced Management Team
  Market Opportunities Available
Positioned For Long-term Success
24
 
 
 
Questions
 
 
 
Appendix
26
 
 
 
27