Farmers Capital Bank Corporation
Farmers Capital Bank — Investor Presentation (June 2009)
46 slides from Farmers Capital Bank's investor presentation, Jun 8, 2009
Slide 1: Farmers Capital Bank Corporation
Farmers Capital Bank Corporation Frankfort, Kentucky G. Anthony Busseni — President and CEO NASDAQ: FFKT
Slide 2: Forward Looking Statement
Forward Looking Statement This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that are based upon current expectations, but are subject to certain risks and uncertainties that may cause actual results to differ materially.
Slide 3: Farmers Capital Bank Corporation
Farmers Capital Bank Corporation Holding Company for 5 bank charters dating back to 1850 m 3rd largest Holding Company based in Kentucky = 37 locations in 23 communities = Depository for the Commonwealth of Kentucky
Slide 4: Tony Busseni
Tony Busseni President and CEO of Holding Company since 2002 President and CEO of Frankfort Bank 1998-2002 President and CEO Georgetown Bank 1992-1998 President and CEO Elizabethtown Bank 1991-1992 Internal Bank Audit 1977-1990 Comptroller of Currency Examiner 1970-1977
Slide 5: Management
Management Total With Years Farmers Tony Busseni, President and CEO ao 23 Doug Carpenter, SVP, Secretary & CFO 30 16 Rick Harp, President, Frankfort 32 SY) Critt Murphy, President, Lexington MSA 30 19 Lloyd Hillard, President, Elizabethtown oh) V7 Charlie Cammack, President, Lawrenceburg 42 42 David
Slide 6: Significant Events
Significant Events & Realize benefits from merging three bank charters in and around Lexington ® Participation in TARP — $30 million = Significant leverage transaction
Slide 7: Kentucky Population
Kentucky Population Total counties — 120 Counties we serve — 13 Total population — 4,241,000 Population in our counties — 1,040,000 or 25% Source: Kentucky State Data Center
Slide 8: Market map
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Slide 9: Market Share
Market Share Total deposits in Kentucky — $63.2 billion Total deposits in our 13 counties — $14.7 billion or 23% Deposits at our banks — $1.5 billion or 10% lst or 2nd highest market share in 6 of our counties
Slide 10: Fort Knox Impact
Fort Knox Impact 2005 Defense Base Closure and Realignment (BRAC) Commission Report m Ft. Knox ranked 12th highest out of 95 bases on the military value assessment Will increase from 4 generals to 13 Military personnel increase — 4,000 Civilian personnel increase — 2,500 Defense contractors expected
Slide 11: Kentucky Based Banks
Kentucky Based Banks Average Assets Republic Bancorp, Louisville $4.0 billion Community Trust Bancorp, Pikeville 2.9 billion Farmers Capital Bank Corporation 2.2 billion Central Bancshares, Lexington 1.9 billion Whitaker Bank Corp., Lexington 1.8 billion S.Y. Bancorp, Louisville 1.6 billion Porter B
Slide 12: Shareholders
Shareholders 7,362,912 shares of Common Stock outstanding 2,882 shareholders Farmers Trust Department — 6% Directors/Insiders — 7% Institutional — 14% As of April 2009
Slide 13: Dividend
Dividend Farmers has historically paid out a large percentage of its net income in the form of dividends. EPS Dividend % 2009 $0.39 $0.25 64 2008 Oe") [N32 >100 2007 2.03 1.43* 70 2006 2.85 132 46 2005 Zl R32 Si 2004 1.99 1.32 66 2003 1.93 1.28 66 * Includes a special dividend of $.11
Slide 14: Dividend
Dividend In January 2009 the company announced a reduction in the quarterly dividend from $0.32 to $0.25 for the dividend to be paid April 1, 2009. Based on the share price at the time, the dividend yield was 5.0%.
Slide 15: Capital Ratios
Capital Ratios March 31, 2009 Peer Tier | 13.61% 10.76% Total 14.86% 227% Leverage 8.63% 8.65% Tangible Equity 6.38% Tangible Common 5.09%
Slide 16: Averages vs. End of Period
Averages vs. End of Period We are the Depository for the Commonwealth of Kentucky and have been for more than 70 years. Large fluctuations in deposits are likely to occur on a daily basis which makes average figures more meaningful than end of period balance sheet numbers.
Slide 17: Monthly State Activity
Monthly State Activity Proof items processed 1,176,871 Amount $1,501,687,396 ACH items processed 1,454,403 Amount $2,215,055,769
Slide 18: Average Earning Assets
Average Earning Assets from Continuing Operations In millions $2,000 1,800 1,600 1,400 1,200 1,000 2007 2008 T Ist Qtr 2.009
Slide 19: Subprime Exposure
Subprime Exposure m= Loans — None = Investment Securities — None = BOLI Investments — None
Slide 20: Loans
Loans Total $1.3 billion or 59% of average assets Real estate mortgage — 63% of total loans Real estate construction — 21% Commercial — 11% Installment — 3% Leasing — 2%
Slide 21: Loans
Loans 55% of total loans variable interest rates Loans in Ohio, Tennessee and Indiana — $72 million or 6% Loans > $2.5 million $385 million or 29% 74 loans Loans > $10 million $95 million 5 loans As of 3-31-09
Slide 22: Loans
Loans Largest loan — $26 million Frankfort municipal utility created in 1943 provides electric, water and cable TV/telephone/internet service Legal lending limit — $36 million
Slide 23: Average Loans
In millions $1,400 1,200 1,000 800 Average Loans from Continuing Operations if 2004 T 2005 2006 2007 Mm 2008 = Ist Qtr 2009
Slide 24: Nonperforming Assets
Nonperforming Assets Trrllione 90 days Nonaccrual OREO Total 3-31-09 $6 $23 $15 $44 12-31-08 4 22 14 40 12-31-07 18 6 27 3 12-31-06 3 1 5 Y) 3 12-31-05 2 9 14
Slide 25: Allowance for Loan Losses
Allowance for Loan Losses ose Allowance Nonperforming 3-31-09 1.35% DON 12-31-08 1.28% 1.9% 12-31-07 1.10% 1.6% 12-31-06 1.00% 0.4% 12-31-05 1.15% 0.5%
Slide 26: Net Chargeoffs
Net Chargeoffs Total % of Loans 3-31-09 $727 thousand 06% 12-31-08 2.7 million 21% 12-31-07 1.4 million 11% 12-31-06 1.1 million 10% 12-31-05 2.0 million 25%
Slide 27: Leveraged Investment
Leveraged Investment Booked 11-15-07 $214 million of new issue GNMA CMO bonds with zero risk weighting and an average life of 7 years yielding 5.67% Funded by multiple structured repos with a 7 year average life with no call protection ranging from | to 5 years on the various pieces at a rate of 3.7
Slide 28: Amortizable Intangibles
Amortizable Intangibles igi Balance Expense 12-31-09 $5.0 $2.0 12-31-08 6.9 2.6 12-31-07 9.5 3.5 12-31-06 9.8 2.3
Slide 29: Average Deposits
In millions $1,800 1,600 1,400 1,200 1,000 Average Deposits from Continuing Operations 2004 2005 + 2006 ~~ «©-2007/+—« 2008 -~—« Ist Qtr 2009
Slide 30: Trust Preferred
Trust Preferred Amount Rate $10 million 3 month LIBOR + 165 15 million 3 month LIBOR + 150 22.5 million 6.60% fixed, for five years, then 3 month LIBOR + 132
Slide 31: Net Income
Net Income from Continuing Operations In millions $18 16 14 10 5 T T T T 2005 2006 2007 2008 Ist Qtr 2009
Slide 32: Margin
Margin from Continuing Operations Percent 2004 ' 2005 ' 2006 ' 2007 | 2008 | 1st Qtr 2009 Excluding leverage transaction & FFKT NasDAg
Slide 33: Noninterest Income
Noninterest Income In millions Total % of Total Income 3-31-09 $ 6.7 20.3 12-31-08 24.5* 17.8 12-31-07 24.2 75 12-31-06 20.5 18.1 12-31-05 eR) 23.2 *Excludes $14.7 million expense related to FNMA and FHLMC preferred stock. 33
Slide 34: Allotment Fee Income
In millions 3-31-09 12-31-08 12-31-07 12-31-06 12-31-05 Allotment Fee Income $1.3 4.8 4.4 2.6 Jiil
Slide 35: Allotment
Allotment For over 30 years we have been processing electronic payments primarily for the benefit of Armed Forces personnel. The government sends our bank an amount each payday that is held in a savings account for each individual until the appropriate ACH bill payments are made. This service is app
Slide 36: Allotment
Allotment Active merchants that initiate transactions — 970 Dollars processed 2008 $786,000,000 2007 $717,000,000 2006 $423,000,000 Payments processed 2008 - 1,997,000 2007 - 1,954,000 2006 - 1,179,000 Average deposits $22,000,000 36
Slide 37: Return on Average Assets
Return on Average Assets from Continuing Operations Percent 1.2 1.0 0.8 0.6 0.4 0.2 0 T T T T T T 2003 2004 2005 2006 2007 2008 = Ist Qtr 2009
Slide 38: Return on Average Equity
Return on Average Equity from Continuing Operations Percent 12 10 8 6 4 24 0 T T T T T T 2003 2004 2005 2006 2007 2008 = Ist Qtr 2009
Slide 39: Recent Acquisitions
Recent Acquisitions = Northern Kentucky/Greater Cincinnati = Jessamine County/Greater Lexington = Allotment Processing
Slide 40: Expansion
Expansion m Citizens Bancorp (Northern K Y/Greater Cincinnati) was purchased December 6, 2005 $150 million in loans $175 million in deposits $40.6 million purchase price 584,000 shares issued $22 million paid in cash
Slide 41: Expansion
Expansion m Citizens National Bancshares (Jessamine County/Greater Lexington) was purchased October 1, 2006 $121 million in loans $139 million in deposits $30 million purchase price 464,283 shares issued $15 million paid in cash
Slide 42: Expansion
Expansion =m PNC Allotment operations was purchased January 12, 2007 First Citizens paid $12,725,000 $3,150,000 in amortizable intangibles $9,575,000 in goodwill Deposits received of $10,870,000
Slide 43: Recent Divestitures
Recent Divestitures mu Glasgow, KY/South Western Kentucky = Bath County/Eastern Kentucky
Slide 44: Divestiture
Divestiture =m On December 1, 2006 we closed on the sale of Kentucky Banking Centers to Citizens First Corporation of Bowling Green for $20 million $9.4 million pre-tax gain on sale $80 million in loans $112 million in deposits Special $.11 dividend to shareholders
Slide 45: Divestiture
Divestiture m On December 2, 2006 we closed on the sale of the Bath County branches of Farmers Bank and Trust Company to Citizens Bank Morehead $431,000 pre-tax gain on sale $12 million in loans $26 million in deposits
Slide 46: A Tradition in Kentucky
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