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| 8-K - FORM 8-K - CenterState Bank Corp | d387208d8k.htm |
 KBW
Community Bank Investor Conference
July 31, 2012
Exhibit 99.1 |
 This presentation contains forward-looking statements, as defined by Federal
Securities
Laws,
relating
to
present
or
future
trends
or
factors
affecting
the
operations, markets and products of CenterState Banks, Inc. (CSFL). These
statements
are
provided
to
assist
in
the
understanding
of future financial
performance. Any such statements are based on current expectations and involve a
number of risks and uncertainties. For a discussion of factors that may
cause such forward-looking statements to differ materially from actual
results, please refer to CSFL’s most recent Form 10-Q and Form
10-K filed with the Securities Exchange Commission.
CSFL undertakes no obligation to release revisions to these forward-looking
statements or reflect events or circumstances after the date of this
presentation. Forward Looking Statement
2 |
 Corporate Overview
3
Correspondent Banking market
Data as of 6/30/12
Headquartered in Davenport, FL
$2.4 billion in assets
$1.5 billion in loans
$2.1 billion in deposits
Company formed: June 2000
1 Subsidiary Bank
Birmingham
Atlanta
Winston-Salem
Tampa
Winter Haven |
 Conservative Balance Sheet
•
CAPITAL
-
Total
Risk-Based
Capital
Ratio
–
18.0%
**
•
LIQUIDITY -
Loans / Assets -
60%
•
LOANS
WITH
THIRD
PARTY
PROTECTION
–
38%
•
23%
of loans are covered by loss sharing agreements with the FDIC
•
15%
are
subject
to
“Put
Back”
agreements
with
TD
Bank
or
The
Hartford
Insurance Co.
•
ASSETS
WITH
THIRD
PARTY
PROTECTION
–
46%
*
•
37%
-
Backed by the United States
•
9%
-
Backed by TD or The Hartford
•
LOW CONCENTRATION LEVELS
**
(excludes FDIC covered loans)
•
CRE
at
101%
of
capital
vs.
300%
guidance
•
CD&L
at
20%
of
capital
vs.
100%
guidance
4
* Includes cash and cash equivalents, AFS securities issued by
U.S. Government Sponsored Entities, FDIC covered assets, and FHLB and FRB stock.
** Estimate for 6/30/12 |
 Opportunistic through
the Crisis 5
1)
FDIC
Acquisitions
•
Ocala National Bank
•
Olde Cypress Community Bank
•
Independent National Bank of Ocala
•
Community National Bank of Bartow
•
Central Florida State Bank
•
First Guaranty Bank & Trust Co.
3)
New
Fee-Based
Business
Lines
•
Correspondent Banking Division
•
Prepaid Card Division
•
Wealth Management Division
•
Trust Department
2)
Non
–
FDIC
Acquisitions
•
TD Bank divesture in Putnam
•
Federal Trust Acquisition from
The Hartford Insurance
Company
4)
Strategic
Expansion
&
Management
Lift-Outs
•
Vero Beach
•
Okeechobee
•
Jacksonville |
 6
Profitability Metrics
1. Pre-tax pre-provision income (“PTPP”) is a non-GAAP measure that if defined as income (loss) before
income tax excluding provision for loan losses, gain on sale of available for sale
securities, other credit related costs including losses on repossessed real
estate and other assets, other foreclosure related expenses., and
non-recurring items. 2Q12 Results:
$0.12/sh on $3.7M net income
Margin expansion to 4.33% (4.19%)
Improved credit metrics
Lower loan loss provision expense
Higher bond sales revenue
Loan growth
Branch consolidation & efficiency results
PTPP improvement
Credit Cost
Net Interest Margin
Operating Efficiencies
$15
$10
$0
$5
($5)
$3.9
$5.5
$3.8
$14.1
$6.3
$1.3
$8.1
$3.7
2Q11
3Q11
4Q11
1Q12
2Q12
($4.3)
($2.0)
Pre-Tax, Pre-Provision Income
Net Income
Profitability
Components:
& Net Income
–
trailing
5 quarters
PTPP
¹ |
 Net
Charge-Offs (NCOs) excludes covered loans
Loan Loss Provision (LLP)
excludes covered loans
Credit Cost
7
1. Excludes FDIC covered loans and loans with putback options.
Total Credit Costs
excludes covered loans
$18.0
$11.4
$16.3
$12.2
Provision expense trending downward
Net charge-offs trending downward
Total credit cost trending downward
$21.0
$13.4
1
Loan Loss Provision
LLP related to loan sales
$2.5
$8.9
$5.0
$6.0
$2.7
$0.8
$12.0
$2.5
$9.7
$6.5
$4.3
$4.7
$2.7
$12.0
Net Change-offs
NCOs related to loan sales
2Q11
3Q11
4Q11
1Q12
2Q12
$20.00
$15.00
$10.00
$5.00
$0.00
2Q11
3Q11
4Q11
1Q12
2Q12
LLP related to loan sales
$2.5
$10.9
$7.3
$9.0
$3.3
$1.8
$12.0
$20.00
$15.00
$10.00
$5.00
$0.00
All other credit cost
$20.0
$15.0
$10.0
$5.0
$0.0
2Q11
3Q11
4Q11
1Q12
2Q12 |
 8
Net Interest Margin
Costs of Deposits
Yield on Interest Earning Assets
Net Interest Margin %
(excluding Correspondent Division)
0.67%
0.62%
0.55%
0.43%
0.38%
4.39%
4.30%
4.33%
4.50%
4.78%
Time Deposits
Demand Deposits
Non Time Deposits
Cost of Deposits
Non FDIC Covered Loans
AFS Securities
Yield on Earning Assets
FDIC Covered Loans
All other
$2.5
$2.0
$1.5
$1.0
$0.5
$0.0
2Q11
3Q11
4Q11
1Q12
2Q12
2Q11
3Q11
4Q11
1Q12
2Q12
$2.5
$2.0
$1.5
$1.0
$0.5
$0.0
5.00%
4.00%
3.00%
0.80%
0.60%
0.20%
0.40%
4.50%
4.00%
3.50%
3.00%
3.85%
3.83%
3.93%
4.20%
4.48%
2Q11
3Q11
4Q11
1Q12
2Q12 |
 24%
20%
28%
14%
14%
Building Franchise Value
with Core Deposits
Value of core deposits not fully realized in this low rate environment.
Approximately 123,010 total accounts -
$16,715 average balance per account
Core deposits defined as non-time deposits.
Total Deposits ($MM)
Number of Deposit Accounts
9
DDA and NOW
6/30/11
6/30/12
Change
% Change
Balance
$706MM
$910MM
$204MM
29%
No. of Accounts
66,930
84,615
17,685
26%
2,500
2,000
1,500
1,000
500
0
2007
2008
2009
2010
2011
501
409
569
280
297
Jumbo Time
6/30/2012
120,000
80,000
40,000
0
2007
2008
2009
2010
2011
6/30/2012
13,191
11,001
12,025
14,998
15,277
16,005
40,822
43,974
54,561
78,874
96,699
107,005
Time
Deposits
Core
Deposits
Retail Time
MMDA
& Savings
NOW
DDA |
 Operating Efficiencies
10
Efficiency Ratio –
Total Company
Opportunities through:
Leverage
Cost Efficiencies
*Source: The Hovde Group |
 11
Focus on Efficiency and Core Earnings
Branch Consolidation –
15 ( 11 FDIC / 4 Legacy)
Reduction in Force -
85
Data Processing Conversions -
Complete
Merger of Subsidiaries -
Complete
Events since 1-1-12 |
 12
NPA Inflows -
Slowing Down |
 NPAs / Loans & OREO (%)
Problem Loan Trends ($MM)
Source: SNL Financial and Company filings. Peer information updated
quarterly Nonperforming assets include 90 days or more past due.
Southeastern peers include ABCB, BTFG, GRNB, PNFP, RNST, SCBT, UBSH and UCBI.
Florida
peers
include
all
banks
headquartered
in
Florida,
opened
no
later
than
12/31/2005
and
total
assets
between
$500
million
and
$5
billion.
13
Credit Quality Trends
CSFL
Southeastern Peers
Florida Peers
TDRs accruing only
90 days and nonaccrual
30 -
89 days past due
OREO/ORA
9.13
7.75
3.47
15.00
10.00
5.00
0.00
$125
$75
$100
$50
$25
$0
$10.7
$12.1
$13.8
$10.3
$8.6
$7.5
$71.6
$66.0
$62.2
$39.0
$42.7
$31.9
$17.3
$10.1
$8.2
$16.3
$7.5
$6.9
$8.7
$8.5
$7.1
$6.6
$6.7
$6.8
3Q10
4Q10
1Q11
2Q11
3Q11
4Q11
1Q12
2Q12
1Q11
2Q11
3Q11
4Q11
1Q12
2Q12 |
 Non-Performing Loans
($M)
$7,496M
OREO & Repos are carried at 45% of
Unpaid Principal Balance
14
Data as of 6/30/12
NPA Breakout
(excluding FDIC covered assets)
OREO & Repo
($M)
$31,887M (2.83% of Gross Loans)
NPLs are carried at 73% of Unpaid
Principal Balance
37%
18%
19%
12%
5%
(28)
(39)
(35)
(93)
(43)
1%
41%
41%
(17)
(23)
(13)
(38)
(6)
9%
18%
37%
18%
19% |
 Source: Florida
Realtors Florida Housing
On the Road to Recovery
15
•
Median single family home prices the highest in 34 months
•
Pending home sales are up 19% from last year
•
Average days on the market is down 17% from last year
Single Family Inventory
Months Supply of Inventory
2010
2011
2012
2010
2011
2012
191,254
163,118
11.8
112,365
11.8
10.0
6.0 |
 44%
16
Banks with Texas Ratio over 200%
Source: SNL Financial
Data as of 3/31/12 or MRQ |
 17
CSFL –
Best Positioned Florida Consolidator
•
CSFL is one of only six
major exchange traded
banks headquartered in FL
with assets greater than
$1.0 billion
•
Disproportionate number of
sellers versus very few
buyers
•
Proven experience through
8 successful acquisitions in
the past 3 years
•
The number of small,
distressed Florida
institutions remains high
Source: SNL Financial
Data for MRQ available
CSFL Advantages
> $1.0 bn & Public
6 Banks
> $1.0 bn & Private
19 Banks
$500 mm -
$1.0 bn
23 Banks
$250 -
$500 mm
45 Banks
< $250 mm
110 Banks |
 Summary
18
Lifetime local bankers with common lineage and vision
Nearly all of the recent growth is guaranteed by the United
States Government or a major financial institution
Major metrics improving with better performance anticipated
Focus on efficiencies in 2012
A consolidator of banks |
 Appendix |
 Source: SNL Financial
Recent M&A Transactions
19
Legacy CSFL Branch
First Guaranty Bank (FDIC)
Central FL State Bank (FDIC)
Three FDIC Acquisitions (3Q 2010)
Federal Trust Acquisition (Nov 2011)
TD Branch Acquisition (Jan 2011) |
 Capital
Total Risk-Based & Tier 1 Leverage
20
* Estimate for 2Q12
Total Risk-Based Capital Ratio
Tier 1 Leverage Ratio
1Q10
2Q10
3Q10
4Q10
1Q11
2Q11
3Q11
4Q11
1Q12
2Q12*
25.00
20.00
15.00
10.00
5.00
19.3
18.88
19.67
19.28
17.99
18.81
18.65
19.05
17.64
18.0
11.6
11.3
10.94
10.3
9.99
10.07
10.28
10.49
9.03
9.23
Two successful capital raises in 2009 and 2010 totaling $114 million
First
publicly
traded
bank
in
Florida
to
successfully
complete
a
capital
raise
during
financial
crisis
in
2009
Over
50
“Blue
Chip”
active
institutional
investors
Institutions committed to capitalize additional FDIC accretive transactions
–
Average
daily
volume
over
50,000
shares |
 Total Deposits by Type (%)
Total Deposits Detail
Deposit Type
Number of
Deposits
Balance
Avg Deposit
Balance
Demand
Deposits
40,621
$ 501 MM
$12,300
NOW
Accounts
43,994
$ 409 MM
$9,300
Savings
Deposits
18,950
$ 243 MM
$12,800
Money
Market
3,440
$ 326 MM
$94,700
Certificates
of Deposit
16,005
$ 577 MM
$36,100
Total
123,010
$ 2,056 MM
$16,700
Demand
Deposits
24%
NOW
Accounts
20%
Savings
Accounts
12%
Money
Market
16%
Certificates
of Deposits
28%
21
Total Deposit Portfolio
(at 6/30/12) |
 Total Loan Portfolio
(at 6/30/12, excluding FDIC covered assets)
Total Loans by Type (%)
Total Loans Detail
22
Loan Type
No. of
Loans
Balance
Avg Loan
Balance
Residential Real
Estate
3,943
$ 423 MM
$107,300
CRE-Owner
Occupied
731
$ 272 MM
$372,100
CRE-Non Owner
Occupied
457
$ 189 MM
$413,600
Construction,
A&D, & Land
478
$ 67 MM
$140,200
Commercial &
Industrial
1,146
$ 128 MM
$111,700
Consumer & All
Other
2,743
$ 49 MM
$17,900
Total
9,498
$ 1,128 MM
$118,800
Consumer /
Other
4%
Commercial
& Industrial
11%
Construction,
A&D, & Land
6%
Comm RE -
Non Owner
Occupied
17%
Comm RE -
Owner
Occupied
24%
Residential
Real Estate
38% |
 Commercial Real Estate by Type ($MM)
Construction Loans by Type ($MM)
CRE Concentrations
(as of 6/30/12, excluding FDIC acquired loans)
23
C&D concentration –
20%
*
vs. 100%
•
59% Owner Occupied
CRE concentration –
101%
*
vs. 300%
% of Total
Loans
Avg. Loan
Amount ($000)
0.3%
$452
0.6%
$902
2.3%
$628
2.5%
$732
2.8%
$194
3.1%
$238
3.9%
$439
4.6%
$564
6.8%
$506
7.6%
$532
7.7%
$585
11.0%
$602
12.5%
$334
13.8%
$354
20.4%
$296
100.0%
$388
% of Total
Loans
Avg. Loan
Amt ($000)
0.1%
$67
0.7%
$470
0.9%
$608
1.3%
$215
1.4%
$960
1.6%
$1,057
3.8%
$184
6.5%
$545
7.5%
$296
8.8%
$390
27.9%
$57
39.4%
$296
100.0%
$140
* Estimate for 6/30/12
Aviation
Hotel/Lodging
Mini Warehouse
Mobile Home Park
Res Multi Family
Agriculture
Strip Center
Restaurant
Warehouse
Industrial
Medical
Church/Education
Other CRE
Retail
Office
$1.4
$2.7
$10.7
$11.7
$12.8
$14.3
$18.0
$21.4
$31.4
$35.1
$35.7
$50.5
$57.8
$63.7
$94.3
$0
$50
$100
Raw Land-Agri
Constr
-
Strip
Center
Constr
-
Medical
Constr
-
Spec
Home
Constr
-
Church/Edu
Construction-Office
Constr
-
Single
Fam
Developed Land
Constr
-
Other
Raw Land-Future Resi
Individual Resi Lot
Raw Land-Future Comm
$0.1
$0.5
$0.6
$0.9
$1.0
$1.1
$2.6
$4.4
$5.0
$5.9
$18.7
$26.4
$0
$7
$14
$21
$28
$35 |