Fulton Financial Corporation · NASDAQ:FULT
Fulton Financial — Business & Banking in New Jersey 2007
24 slides from Fulton Financial's conference presentation, Jan 18, 2007
Slide 1: Business & Banking in New Jersey 2007
Business & Banking in New Jersey 2007 R. Scott Smith, Jr. Fulton Financial Corporation January 18, 2007
Slide 2: Forward-looking statements
| The following presentation may contain forward-looking statements about Fulton Financial Corporation’s growth and acquisition strategies, new products and services, and future financial performance, including earnings and dividends per share, return on average assets, return on average equity, eff
Slide 3: Regional financial holding company
® Regional financial holding company (formed in 1982) ™14 community banks and 3 financial services affiliates in 5 states ® 263 community banking offices Asset size: $14.9 billion @ Market capitalization: $2.8 billion
Slide 4: Where are we located?
Where are we located? FULTON FINANCIAL PORATION
Slide 5: Serving New Jersey Counties with Branches
Serving 14 of 21 New Jersey Counties with 72 Branches Gi The Bank BH Skylands Community Bank Bi First Washington State Bank BD Somerset Valley Bank = @ & FultonFinancial Comoration | =o = = om mom
Slide 6: Assets (12/31/06)
Assets (12/31/06) The Bank (Woodbury) 1.318 billion Skylands Community Bank (Hackettstown) 609 million First Washington State Bank (Windsor) 589 million Somerset Valley Bank (Somerville) 575 million FFC New Jersey Assets 3.091 billion Deposit Market Share (FDIC 6/30/06) 1.09 %
Slide 7: Confidence in business climate and economy is low
™ Confidence in business climate and economy is low = Employers less optimistic on sales, profits, employment High cost of doing business ie. health insurance and property taxes ™51% expect “moderate” deterioration in economic conditions | The good news: a slowdown, nota recession Source: NJBIA Surv
Slide 8: Business confidence (NJ) at lowest level since 1991
™ Business confidence (NJ) at lowest level since 1991 ™ Only 12% expect improvement, 18% in 2006 | Optimism is down from 2006 across industry spectrum ® Retail and construction are greatest concerns ™ 47% of construction industry sees 2007 as very challenging Source: NJBIA Surve
Slide 9: Hiring and cutback expectations
© 21% will hire more, down from 24% ™12% considering cutbacks, up from 10% | NJ lagged nation for last three years in private-sector job growth § 2/3 of employers having difficulty finding “skilled” help ™ Professional, technical and managerial talent also in short supply Source: NJBIA Si
Slide 10: Sales and profit expectations for 2007
™ 43% see sales rising in 2007, 29% see declines | Positive: manufacturing, communications, utilities | Negative: construction, retail, insurance, real estate, financial ™ Profits: 37% expect profits to increase, 36% expect decline ™ Purchases: 37% will spend more, 42% less Source: NIBIA Survey 10
Slide 11: Expense control — wages and benefits
® Expense control —- wages and benefits ® Biggest concern is property taxes: 81% expect increases ™@ Average pay increases 3 to 4% statewide © Cost of health care remains major concern ™ 49% expect benefit costs to rise 6% or more @§ Ad budgets: 33% more, 55% same, 12% less © Borrowing costs flat to
Slide 12: Business friendliness of the state
mOnly 17% see the state as “business friendly”, down from 28% Why? Taxes, government spending and healthcare costs ™Cost of regulatory compliance: 94% say it’s a significant issue and getting worse Source: NIBIA Survey R
Slide 13: Great work force
™Great work force Quality of public education ™Shared concern about protecting the environment S Quality of life is still seen as a plus B
Slide 14: We really like New Jersey
We really like New Jersey and continue to see lots of opportunity! 4
Slide 15: County median household income rankings
Median HH County National Ranking Ranking in State Ranking FFC Affiliate Fairfax, VA Eat #1 $100,803 Resource Bank Hunterdon, NJ #5 #4 91,622 Skylands Bank Morris, NJ #9 #2 89,020 Skylands Bank Somerset, NJ #10 #3 88,665 Somerset Valley Howard, MD #11 #4 86,586 Columbia Bank Montgomery, MD #13 #2 85
Slide 16: Proven business model
| Proven business model = Consistent performance ™ 25 consecutive years of record earnings ™32 consecutive years of dividend increases ™ 10.2% compounded annual growth rate in dividends per share ™8.6% compounded annual growth rate in earnings per share (last 5 years = 5.5%) @ 25 bank acquisitions
Slide 17: Affiliate knows local markets best
EB Affiliate knows local markets best Maintains established local brand value @Prestigious jobs in local markets ™Customer decision-making autonomy ™ Performance goals Affiliate plan execution cd
Slide 18: Acquisition benefits: diversification, autonomy, lending capacity
| Increased product and revenue diversification | Continued local autonomy and decision-making | Increased lending capacity @ Additional capital | Proven merger/conversion expertise ™ Reduced expenses 18
Slide 19: For our shareholders, employees, customers, communities
For our : With Shareholders: People Employees; Place Customers : Promotion Communities: Product : Price oT)
Slide 20: Long-term successful employees, customers, shareholders
SLong-term SLong-term SLong-term successful » successful » successful employees customers shareholders 20
Slide 21: Economic outlook for 2007
™ Modest growth early — more traction mid/late year § Oil prices will continue to decline Inflation under control © Unemployment rate rising slightly first half of year ®§ Reduction of Fed Funds rate to 5% in Q2/07 and to 4.75% Q3/07 ® Yield curve slightly positive by year-end ® Reduction in prime r
Slide 22: Challenges: loan growth, asset quality, NIM compression
® Loan growth @ Asset quality MS Inverted yield curve | Managing NIM compression | Core funding and cost Internet competition = Compliance costs ™ State and National economies wy
Slide 23: Strategy to execution
™Strategy to execution MOrganic vs. acquisitive growth ™Expense control ElIncreasing M&A activity ®Health Savings Accounts Remote deposit capture ™Correspondent banking B
Slide 24: Fulton Financial Corporation
Fulton Financial Corporation One Penn Square Lancaster, PA 17602 www. fult.com Mm
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