4th Quarter First Financial Bankshares,

Transcription

1 4th Quarter 2015 First Financial Bankshares, 0 Inc.

2 Forward Looking Statement The numbers, as of and for the year ended December 31, 2015, contained within this presentation are unaudited. Certain statements contained herein may be considered forward-looking statements as defined in the Private Securities Litigation Reform Act of These statements are based upon the belief of the Company s management, as well as assumptions made beyond information currently available to the Company s management and, may be, but not necessarily are identified by such words as expect, plan, anticipate, target, forecast and goal. Because such forward-looking statements are subject to risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements. Factors that could cause actual results to differ materially from the Company s expectations include competition from other financial institutions and financial holding companies; the effects of and changes in trade, monetary and fiscal policies and laws, including interest rate policies of the Federal Reserve Board; changes in the demand for loans; fluctuations in value of collateral and loan reserves; inflation, interest rate, market and monetary fluctuations; changes in consumer spending, borrowing and savings habits; and acquisitions and integration of acquired businesses, and similar variables. Other key risks are described in the Company s reports filed with the Securities and Exchange Commission, which may be obtained under Investor Relations-Documents/Filings on the Company s web site or by writing or calling the Company at The Company does not undertake any obligation to update publicly or revise any forward-looking statements herein because of new information, future events or otherwise.

3 Who We Are $6.7 billion financial holding company headquartered in Abilene, Texas Group of 11 separate regions 125-year history Growth markets include 50 mile radius of the larger cities of Texas 2

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5 Recognitions ABA Foundation Community Commitment Award October Proven Performers Award Winner Bank Intelligence Solutions American Banker - #15 Based on three year average Return on Equity May 2015 KBW Honor Roll One of twenty five banks named April 2015 Raymond James Community Bankers Cup #1 December

6 What Makes Us Different One Bank, Eleven Regions Concept One Bank Consolidation of backroom operations, technology, and compliance (lower efficiency ratio) Eleven Regions Regional Presidents run their regions Local Boards Movers and Shakers of the Community Keep our regions locally focused Make sure we meet the needs of the community Help us make better loan decisions Help us market the region 5

7 FFIN s Unique Positioning in Texas Bank Comerica Key Markets DFW, Austin, Houston, California, Michigan, Florida, Mexico Green Houston, Austin, Dallas (New Public Company August 2014) Frost Independent International Bancshares Legacy Texas Prosperity Southside Texas Capital San Antonio, Austin, Corpus Christi, DFW, Rio Grande, West Texas North and Central Texas Rio Grande, Houston, San Antonio, Oklahoma Dallas Houston, DFW, Austin, West Texas, South Central Texas, and Oklahoma East Texas DFW, Austin, San Antonio, and Houston Triumph Dallas (New Public Company November 2014) Veritex Dallas (New Public Company October 2014) 6

8 First Bank, N.A. - Conroe Acquisition Consummated July 31, 2015 Montgomery, Walker, & Harris Counties (On I-45 North of Houston) Exxon Mobil Headquarters in the Woodlands Montgomery County Approximately 500,000 residents, 55% growth from 2000 to 2010, 24 th fastest growing county in the United States #4 Market Share in Conroe 10.6% 8 Branches in Conroe, Magnolia, Tomball, Cut and Shoot, Montgomery, and Huntsville; additional site on Grand Parkway in Spring, Texas to expand $393.0 million in Assets* $330.9 million in deposits $270.6 million in loans 1.06% Return on Assets in 2014 $61.0 million purchase price of our stock which represents 16x last twelve months earnings Conroe acquisition is consistent with our acquisition model of high growth areas, strong management and excellent earnings opportunity Provides diversification and fits well into our footprint Management and Board share same values to outstanding customer service 7 *As of Dec. 31, 2015

9 4Trust Mortgage Acquisition Consummated May 31, 2015 Originated $175 million in mortgage loans in 2014 Compared to $225 million that First Financial Bank originated in year old Company with offices in Fort Worth, Dallas and North Richland Hills $1.9 million purchase price Troy Fore is now President of Mortgage Division of First Financial Bank; other owners joining First Financial as EVP s Tammie Harding, Kami Graves, and Ryan Craig Considered one of the top mortgage companies in Fort Worth Are now offering expanded mortgage products and services to customers 8

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11 Texas: Large and Growing Five most populous states:* Growth ( ) California 38.8 million 8.1% Texas 26.9 million 20.1% Florida 19.9 million 15.0% New York 19.7 million 2.6% Illinois 12.9 million 1.8% 10 * U.S. Census Bureau

12 Target Markets Population Growth Population growth ( ) in FFIN expansion markets:* Texas 20.1% Bridgeport & Wise County 19.4% Fort Worth & Tarrant County 21.4% Cleburne & Johnson County 14.4% Weatherford, Willow Park, Aledo & Parker County 30.3% Granbury & Hood County 19.6% Stephenville & Erath County 15.9% Conroe & Montgomery County 47.0% 11 * U.S. Census Bureau

13 Core Markets: West Central Texas Markets served benefiting from well-established, long- time customers REGION ASSET SIZE* LOCATIONS DEPOSIT MARKET SHARE** MARKET SHARE RANK** First Financial Bank (Abilene, Clyde, Moran, Albany, Odessa $2,615M 23 48% 1 Eastland, Ranger, Rising Star, Cisco, Sweetwater, Roby, Trent, Merkel) First Financial Bank (Hereford) First Financial Bank (San Angelo) $176M 1 44% 1 $694M 3 27% 1 TOTALS $3,485M 27 * Data as of ** Data as of

14 Expansion Markets REGION ASSET SIZE* LOCATIONS DEPOSIT MARKET SHARE** MARKET SHARE RANK** First Financial Bank $401M 4 24% 1 (Cleburne, Burleson, Alvarado) (Midlothian, Waxahachie) 2 5% 6 First Financial Bank $402M 4 4% 6 (Southlake, Trophy Club, Keller, Grapevine) (Bridgeport, Decatur, Boyd) 3 18% 3 First Financial Bank (Stephenville, Granbury, Glen Rose, Acton) First Financial Bank (Weatherford, Aledo, Willow Park, Brock) First Financial Bank (Mineral Wells) First Financial Bank (Ft. Worth) $482M 6 24% 2 $533M 7 23% 1 $269M 1 39% 1 $49M First Financial Bank $482M 3 38% 1 (Orange, Mauriceville, Vidor) (Newton, Port Arthur, Beaumont) 3 2% 9 First Financial Bank (Acquired ) (Conroe, Magnolia, Cut and Shoot, Montgomery, Huntsville, Willis, Tomball, Huntsville, New Waverly Market Share for Huntsville, Conroe, Magnolia, Cut and Shoot, Montgomery and Willis Only) $585M 10 4% 9 TOTALS $3,154M 43 * Data as of ** Data as of

15 Recent De Novo Growth Lubbock: Office of Trust Company September 2014 New Waverly: Branch of Huntsville August 2014 Beaumont: Branch of Orange August 2014 Weatherford: I-20 Branch June 2013 San Angelo: HEB Branch March 2013 Waxahachie: Branch of Cleburne December 2012 Abilene: Antilley Road Branch September 2012 Grapevine: Branch of Southlake March 2012 Cisco: Branch of Eastland September 2011 (Building New Building Planned Opening 2 nd Qtr. 2016) Lamesa: Office of Trust Company April 2011 Odessa: Branch of Abilene February 2010 (Building New Building Planned Opening 2 nd Qtr. 2016) Fort Worth: Branch of Weatherford February 2010 Odessa: Office of Trust Company April 2009 Merkel: Branch of Sweetwater July 2008 Brock: Branch of Weatherford March 2008 Acton: Branch of Stephenville March 2008 Albany: Branch of Abilene May 2007 Fort Worth: Office of Trust Company April 2007 (Building New Building Planned Opening 2 nd Qtr. 2016) 14

16 Fort Worth Forest Park Blvd. and Rosedale 1515

17 Fort Worth Forest Park Blvd. and Rosedale 16

18 Executive Management at First Financial Years with Company Years in Industry Scott Dueser Chairman of the Board, President & Chief Executive Officer Ron Butler Executive Vice President Chief Administrative Officer Troy Fore President First Financial Mortgage Gary S. Gragg Executive Vice President Credit Administration J. Bruce Hildebrand, CPA Executive Vice President Chief Financial Officer

19 Executive Management at First Financial Years with Company Years in Industry Luke Longhofer Executive Vice President & Loan Review Officer Credit Administration Stan Limerick Executive Vice President Chief Information Officer Randy Roewe Executive Vice President Chief Risk Officer Kirk Thaxton, CTFA President First Financial Trust & Asset Management Marna Yerigan Executive Vice President Credit Administration

20 Senior Management at First Financial Years with Company Years in Industry Brandon Harris Senior Vice President Appraisal Services Monica Houston Senior Vice President Training Larry Kentz Senior Vice President & Compliance Officer Compliance Michele Stevens Senior Vice President Advertising and Marketing

21 Experienced Regional CEOs & Presidents Years with Company Years in Industry Marelyn Shedd, Abilene Mike Mauldin, Hereford Mike Boyd, San Angelo Tom O Neil, Cleburne Trent Swearengin, Stephenville Jay Gibbs, Weatherford Mark Jones, Southlake Ken Williamson, Mineral Wells Stephen Lee, Southeast Region 3 26 Sam Baker, Conroe - 39 Martin Noto, Fort Worth

22 Asset Performance Growth in Total Assets (in millions) $6,665 $5,848 $5,522 $3,776 $4,121 $4,

23 Deposit Growth Growth in FFIN Total Deposits (in millions) $5,190 $4,750 $4,135 $3,113 $2,154 $3,335 $2,233 $3,633 $2,321 $2,773 $3,180 $3,444 $959 $1,102 $1,312 $1,362 $1,570 1, Non Interest Bearing Interest Bearing 22

24 Deposit Products Savings 11.4% Time 12.0% Demand 33.6% Money Market 43.0% 23

25 Account Growth Total Number of Accounts December 31, 2011 December 31, 2012 December 31, 2013 December 31, 2014 December 31, , , , , ,699 Net Growth in ,036 Accounts Net Growth in ,219 Accounts Net Growth in ,308 Accounts* Net Growth in ,687 Accounts Net Growth in ,886 Accounts** 24 *(Excluding Orange Acquisition) **(Excluding Conroe Acquisition)

26 Loan Performance Growth in FFIN Total Loans (in millions) $3,351 $2,938 Real Estate $2,689 Commercial $1,691 $1,787 $2,089 $1,689 $1,831 $2,178 Consumer $990 $1,076 $1,238 Agricultural $429 $427 $510 $590 $640 $685 $191 $218 $273 $334 $361 $386 $81 $66 $68 $76 $106 $

27 Overview of Loan Portfolio Commercial 20.4% Agriculture 3.1% Consumer 11.5% Real Estate 65.0% Note: Oil & Gas Exposure 2.89% 26

28 Breakdown of R/E Loan Portfolio Residential Development & Construction 9.7% Other R/E 15.2% 1-4 Family 44.6% Commercial R/E 25.4% Commercial Development and Construction 5.1% 27

29 Loan to Deposit Ratio End of Period Average Balances

30 Sound Lending Practices Nonperforming assets as a percentage of loans + foreclosed assets (FFIN vs. Peers) First Financial 1.53% 1.64% 1.22% 1.16% 0.74% 0.89% Peer Group 5.37% 4.59% 2.75% 1.97% 1.28% 0.94%* 29 *As of Sept. 30, 2015

31 Allowance for Loan Losses and Provision for Loan Losses (in thousands) $41,877 $31,106 $34,315 $34,839 $33,900 $36,824 $8,962 $6,626 $3,484 $3,753 $4,465 $9, ALLL Provision 30

32 Summary of Bond Portfolio Agencies Treasuries 5.80% 0.42% Corporates 3.13% CMOs 23.23% Muni 51.61% MBSs 15.81% 31

33 Growth in Trust Assets Total Trust Assets $3,759 $3,870 $2,297 $2,431 $1,783 $1,912 $2,852 $2,233 $3,361 $2,465 $2,774 $3,060 Market Value Book Value

34 Total Trust Fees Growth in FFTAM Fees (in thousands) $18,766 $19,251 $10,808 $12,671 $14,464 $16,

35 Total Trust Net Income Growth in FFTAM Net Income (in thousands) $7,109 $7,449 $6,142 $5,183 $3,254 $4,

36 29th Consecutive Year of Increased Earnings FFIN Earnings (in millions) $100.4 $89.6 $59.7 $68.4 $74.2 $

37 Strong Shareholder Earnings Basic Earnings Per Share $1.55 $1.40 $0.95 $1.09 $1.18 $ *Per share amounts reflect the 2 for 1 stock split that was effective June 2,

38 FFIN Outperforms Peers Percentage Return on Average Assets 1.78% 1.75% 1.64% 1.65% 1.61% 0.80% 0.98% 1.04% 0.95% 0.98%* First Financial Peer Group *As of Sept. 30, 2015

39 Strong Return on Capital Percentage Return on Average Equity 14.44% 13.85% 13.75% 14.00% 13.60% 7.27% 8.56% 8.89% 8.34% 8.67%* First Financial Peer Group *As of Sept. 30, 2015

40 Capital & Capital Ratios (dollars in thousands) Shareholders Equity 508, , , , ,986 As a Percent of Total Assets Tangible Capital Tier 1 Leverage Ratio Tier 1 Risk Based Capital Ratio Risk Based Capital Ratio , , , , ,

41 Net Interest Margin Quarterly Interest Margin 5.00% 4.75% 4.50% 4.25% 4.00% 3.75% 3.50% 3.25% 3.00% 3rd 4th 1st 2nd 3rd 4th 1st 2nd 3rd 4th 1st 2nd 3rd 4th Qtr. '12Qtr. '12Qtr. '13Qtr. '13Qtr. '13Qtr. '13Qtr. '14Qtr. '14Qtr. '14Qtr. '14Qtr. '15Qtr. '15Qtr. '15Qtr. '15 First Financial Peer Group 40

42 Working Harder and Smarter Efficiency Ratio (FFIN vs. Peers) First Financial 49.49% 48.37% 48.14% 50.20% 49.24% 47.61% Peer Group 67.33% 65.57% 65.77% 67.80% 66.76% 63.79%* *As of Sept. 30,

43 Total Return on Investment Assume you owned 1,000 shares of FFIN stock on January 1, 2015 Stock cost in January 2015 $29,880 Dividend declared ($0.62 x 1,000 shares) $ 620 Increase in stock price during 2015 ($29.88 to $30.17 X 1,000 shares) $ return on investment 3.05% 2014 return on investment -7.96% 2013 return on investment 72.11% 2012 return on investment 19.65% 2011 return on investment 0.61% 5 year compound average return 13.95% 12.36% *Adjusted for 2 for 1 stock split effective June 2,

44 Dividends Per Share Annual Dividends Declared Per Share* $0.62 $0.48 $0.50 $0.52 $ *Per share amounts reflect the 2 for 1 stock split that was effective June 2,

45 Strong Stock Performance % % % 50.00% 0.00% % % Jan. 07 Dec 07 Dec 08 Dec. 09 Dec. 10 Dec. 11 Dec. 12 Dec. 13 Dec. 14 Dec. 15 FFIN S&P 500 NASDAQ Dow Jones 44

46 Challenges Regulatory reform from Washington Stagnant national economy Oil & gas price decline Low interest rate environment Maintaining net interest margin 45

47 Opportunities Loan Growth Mortgage Lending Trust Services Treasury Management Mobile Banking Lower Efficiency Ratio Potential Acquisitions 46

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