Associated Banc-corp · NYSE:ASB
Associated Banc-corp — Investor Presentation (February 2017)
28 slides from Associated Banc-corp's investor presentation, Feb 8, 2017
Slide 1: Associated Banc-Corp Investor Presentation First Quarter 2017
Associated Banc-Corp Investor Presentation FIRST QUARTER 2017
Slide 2: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS Important note regarding forward-looking statements: Statements made in this presentation which are not purely historical are forward-looking statements, as defined in the Private Securities Litigation Reform Act of 1995. This includes any statements regarding management’s
Slide 3: Our Franchise
1 – Retail banking locations in Wisconsin, Illinois and Minnesota and commercial financial offices in Indiana, Michigan, Missouri, Ohio, and Texas 2 – Last twelve months ended December 31, 2016 All trademarks, service marks, and trade names referenced in this material are official trademarks and the
Slide 4: Attractive Midwest Markets
Midwest Commercial Real Estate Price Index is half as volatile4 as the Northeast regional index Midwest Home Price Index is half as volatile5 as the national average ATTRACTIVE MIDWEST MARKETS 3.6% 3.9% 4.0% 4.0% 4.4% 4.7% 4.9% 5.0% 5.7% IA MN WI IN MO U.S. OH MI IL Midwest 30% All other regions 70%
Slide 5: Management Outlook
71% 65% 2011 2016 Federal Reserve Fully tax-equivalent $0.6 $0.7 $0.3 $0.4 2011 2016 Noninterest income Net interest income MANAGEMENT OUTLOOK 4 Growing Revenues Stabilizing Margin Improving Efficiency1 Expanding Bottom Line Well positioned for 2017 2015 2016 2011 2016 $0.9 billion $1.1 billion 2.84
Slide 6: Positioned for Loan Growth
$1.8 $1.6 $1.5 $1.5 $1.4 $4.4 $4.6 $4.9 $5.5 $6.2 $3.4 $3.7 $4.0 $4.2 $4.7 $5.1 $5.8 $6.5 $7.0 $7.4 2012 2013 2014 2015 2016 Commercial & business Commercial real estate Residential mortgage Home equity & Other consumer POSITIONED FOR LOAN GROWTH 5 $19.7 $16.8 $18.3 $15.7 $14.7 ($ in billions) Comme
Slide 7: Positioned for Deposit Growth
Loan to Deposit Ratio $2.2 $1.8 $1.6 $1.6 $1.6 $1.1 $1.2 $1.2 $1.3 $1.4 $6.1 $7.3 $7.6 $9.2 $9.1 $2.1 $2.8 $3.0 $3.2 $3.8 $3.9 $4.2 $4.2 $4.5 $5.1 2012 2013 2014 2015 2016 Time deposits Savings Money market Interest-bearing demand Noninterest-bearing demand 95% 90% 95% 92% 94% In 2016, nearly all of
Slide 8: Focused on Customer Experience
600 650 700 750 800 850 2011 2012 2013 2014 2015 2016 2017 YTD FOCUSED ON CUSTOMER EXPERIENCE 7 ROBUST AFFINITY PROGRAMS OUTSTANDING CUSTOMER SERVICE CHALLENGER PHILOSOPHY MULTI-CHANNEL INITIATIVES Customer Approach J.D. Power U.S. Retail Banking Satisfaction Study2 1 – J.D. Power 2016 Certified Con
Slide 9: Growing Fee Businesses
$46 $47 $47 $48 $50 $41 $46 $49 $49 $47 $16 $16 $13 $15 $22 $15 $15 $16 $15 $16 $47 $44 $44 $75 $81 2012 2013 2014 2015 2016 Card-based and other nondeposit fees Trust service fees Capital markets fees Brokerage and annuity commissions Insurance commissions All other fee categories GROWING FEE BUSIN
Slide 10: Positioned for Higher Interest Rates
40% 25% 35% Deposit Repricing Fast moving Mixed Slow moving 65% 28% 7% Loans Repricing or Maturity Term < 1 year 1 - 10 years > 10 years Money market Interest-bearing demand Time Savings Noninterest-bearing demand $626 $646 $681 $676 $707 2012 2013 2014 2015 2016 Net interest income 3.30% 3.17% 3.08
Slide 11: Increasing Distribution Efficiency
10 INCREASING DISTRIBUTION EFFICIENCY LESS BRANCH CENTRIC; MORE MOBILE AND ENHANCED 24/7 ACCESS Over 55% access online banking Over 30% access mobile banking Consumer deposit customers as of December 2016 Mobile deposits ~40% from 2015 Deposits ~50% from 2007 Branches ~30% from 2007 Completed extens
Slide 12: Overall Expense Efficiency
Enhanced Automation Operational Efficiencies Branch Consolidations Branch Staffing Initiatives OVERALL EXPENSE EFFICIENCY AUTOMATION AND INVESTMENTS ARE DRIVING BETTER EFFICIENCY OVER TIME Efficiency Drivers 1 – The efficiency ratio as defined by the Federal Reserve guidance is noninterest expense (
Slide 13: Improving Capital Efficiency
$0.23 $0.45 2012 2016 Dividends per Common Share IMPROVING CAPITAL EFFICIENCY 12 172 150 2012 2016 Average Common Shares Outstanding Diluted millions 11.61% 11.46% 9.74% 9.52% 9.52% 2012 2013 2014 2015 2016 Common Equity Tier 11 Ratio $11.39 $12.78 2012 2016 Tangible Book Value per Common Share 4 Fu
Slide 14: Expanding Bottom Line
Earnings Per Share Dividends Shareholder Gain Return on Average Common Equity Tier 12 35% 145% One Year Five Year 19% annualized TSR EXPANDING BOTTOM LINE 13 6.7% 9.9% 2011 2016 $0.04 $0.45 2011 2016 $0.66 $1.26 2011 2016 As of December 31, 2016 Growing Shareholder Wealth $245.40 $198.00 $226.50 $10
Slide 15: 2017 Outlook
2017 OUTLOOK Balance Sheet Management Mid-to-high single digit annual average loan growth Maintain Loan to Deposit ratio under 100% Stable to improving NIM trend, assuming additional Federal Reserve action to raise rates Fee Businesses Improving fee-based and capital markets revenues Decli
Slide 16: Line of Business Profiles
LINE OF BUSINESS PROFILES
Slide 17: Balanced Business Segments
11.0% 10.5% Corporate and Commercial Specialty Community, Consumer, and Business Return on Average Allocated Capital BALANCED BUSINESS SEGMENTS 16 Community, Consumer, and Business Corporate and Commercial Specialty $376 $628 Corporate and Commercial Specialty Community, Consumer, and Business Reven
Slide 18: Corporate Banking
Corporate Lending Specialized Lending Verticals Commercial Deposits and Treasury Management Capital Markets CORPORATE BANKING CORPORATE AND COMMERCIAL SPECIALTY SEGMENT 17 Creative, relationship-oriented teams build loyal, long-lasting client relationships Corporate Lending serves large and comple
Slide 19: Commercial Real Estate
COMMERCIAL REAL ESTATE CORPORATE AND COMMERCIAL SPECIALTY SEGMENT 18 Local experienced teams create custom real estate financing solutions Term, acquisition, construction and interim-bridge financing Deposit and cash management solutions Specialized financial services including loan syndicatio
Slide 20: Consumer and Business Banking
Full range of banking servicing individuals and small business owners Retail Banking provides best-in class customer experience across branches and digital channels Residential Lending offers residential mortgages and home equity lines of credit through direct and third party channels Business
Slide 21: Community Markets
COMMUNITY MARKETS COMMUNITY, CONSUMER, AND BUSINESS SEGMENT 20 Localized approach ensures the customer experience is at the forefront of decisions and actions Virtual community banks with our full suite of financial and risk management solutions in midsize markets Community market presidents are
Slide 22: Private Client and Institutional Services
PRIVATE CLIENT AND INSTITUTIONAL SERVICES COMMUNITY, CONSUMER, AND BUSINESS SEGMENT 21 Market-based teams are comprised of specialists Private Client Services offers a suite of services tailored to the unique needs of high-net-worth clients Institutional Services works with businesses and other
Slide 23: Appendix
APPENDIX
Slide 24: Credit Quality – Annual Trends
$253 $185 $177 $158 $128 $20 $147 2012 2013 2014 2015 2016 Oil and Gas 1.9% 1.7% 1.5% 1.5% 1.4% 5.6% 5.7% 2012 2013 2014 2015 2016 ALLL / Total Loans Oil and Gas ALLL / Oil and Gas Loans CREDIT QUALITY – ANNUAL TRENDS ($ IN MILLIONS) $361 $235 $190 $178 $276 $124 $75 2012 2013 2014 2015 2016 Oil and
Slide 25: Loan Portfolio Composition
Commercial & Business Lending $7.4 billion Residential Mortgage $6.3 billion Wisconsin 28% Illinois 16% Minnesota 8% Texas3 11% Other Midwest2 9% Other 28% Wisconsin 32% Illinois 26% Minnesota 11% Other Midwest2 13% Texas 5% Other 13% East Texas North Louisiana Arkansas 19% Mid- Continent (primarily
Slide 26: Oil and Gas Update
OIL AND GAS UPDATE $608 $477 $451 $398 $446 $124 $150 $176 $171 $75 $20 $129 $129 $127 $147 4Q 2015 1Q 2016 2Q 2016 3Q 2016 4Q 2016 Pass Potential Problem Loans Nonaccrual $752 $756 $756 $696 $668 Period End Loans by Credit Quality Oil and Gas Allowance $42 $49 $42 $38 $38 5.6% 6.5% 5.6% 5.5% 5.7% 4
Slide 27: High Quality Securities
40% 29% 60% 70% <1% 1% Dec 2015 Dec 2016 HIGH QUALITY SECURITIES ($ IN BILLIONS) 26 $4.47 $5.00 $5.59 $5.91 $6.05 2.97% 2.66% 2.63% 2.50% 2.38% 1.00% 2.00% 3.00% 4.00% 5.00% $- $0.01 .$0 2 . .3$0 .4 .$0 5 . .6$0 .7 .$0 8 .9 $0. .1 0$ .1 1.$ 2 .1 .3$ .41 .$ 5 .1 6 .$ .71 $ .8 .1 9$ . 2 0 .$ .12 .$ 2
Slide 28: Reconciliation and Definitions of Non-GAAP Items
Common Equity Tier 1 ($ in thousands) 2012 2013 2014 2015 2016 Common equity $2,873,127 $2,829,428 $2,740,524 $2,815,867 $2,931,383 Goodwill and other intangible assets, net (944,395) (940,352) (936,605) (985,302) (987,328) Tangible common equity 1,928,732 1,889,076 1,803,919 1,830,565 1,944,055 Les
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