Attached files
| file | filename |
|---|---|
| 8-K - 8-K - CVB FINANCIAL CORP | d574940d8k.htm |
| EX-99.2 - EX-99.2 - CVB FINANCIAL CORP | d574940dex992.htm |
 2Q
Results 2013 | cbbank.com July 2013
Exhibit 99.1 |
 Certain
matters
set
forth
herein
(including
the
exhibits
hereto)
constitute
forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995, including forward-looking
statements relating to the Company's current business plans
and
expectations
regarding
future
operating
results.
These
forward-looking
statements
are
subject
to
risks
and
uncertainties
that could cause actual results, performance or achievements to differ materially
from those projected. These risks and uncertainties include, but are not
limited to, local, regional, national and international economic conditions and events and the
impact
they
may
have
on
us
and
our
customers;
ability
to
attract
deposits
and
other
sources
of
liquidity;
ability
to
make
loans
and
generate assets; oversupply of inventory and continued deterioration in values of
real estate in California and other states where our bank makes loans, both
residential and commercial; a prolonged slowdown in business, manufacturing, retail or construction
activity; changes in the financial performance and/or condition of our borrowers;
changes in the level of non-performing assets and charge-offs; the
effect of changes in laws and regulations (including laws and regulations concerning taxes, banking,
business and consumer credit, capital levels, limits on bank products and fees,
securities, executive compensation and insurance) with which we and our
subsidiaries must comply; changes in estimates of future reserve requirements based upon the periodic
review thereof under relevant regulatory and accounting requirements; inflation,
interest rate, securities market and monetary fluctuations; the availability
and effectiveness of hedging instruments and strategies; political instability; acts of war or terrorism, or
natural disasters, such as earthquakes, or the effects of pandemic flu; the timely
development and acceptance of new banking products and services and perceived
overall value of these products and services by users; changes in consumer spending,
borrowing and savings habits; technological changes (including mobile banking and
cloud computing); threats to the stability and
security
of
our
technology
hardware
and
software,
and
to
the
stability
and
security
of
any
related
vendor
or
customer
hardware and software; the ability to increase market share and control expenses;
changes in the competitive environment among financial and bank holding
companies and other financial service providers; continued volatility in the credit and equity
markets and its effects on the general economy; the effect of changes in accounting
policies and practices, as may be adopted by the regulatory agencies, as well
as the Public Company Accounting Oversight Board, the Financial Accounting
Standards Board and other accounting standard setters; changes in our organization,
management, compensation and benefit plans; the costs and effects of legal and
regulatory developments including the resolution of legal proceedings or regulatory or
other governmental inquiries and the results of regulatory examinations or reviews;
our success at managing the risks involved in the
foregoing
items
and
other
factors
set
forth
in
the
Company’s
public
reports
including
its
Annual
Report
on
Form
10-K
for
the
year
ended
December
31,
2012,
and
particularly
the
discussion
of
risk
factors
within
that
document.
The
Company
does
not
undertake, and specifically disclaims any obligation to update any
forward-looking statements to reflect occurrences or unanticipated events
or circumstances after the date of such statements except as required by law.
2
2Q Results 2013 | cbbank.com
Safe Harbor |
 2Q
Results 2013 | cbbank.com Total Assets:
$6.4 Billion
Gross Loans:
$3.3 Billion
Total Deposits (Including Repos):
$5.3 Billion
Total Equity:
$752 Million
Source: Q2 2013 earnings release & company filings. *non-covered loans
Largest
financial
institution
headquartered
in
the
Inland
Empire
region
of
Southern California. Founded in 1974.
Serves 40 cities with 41 business financial centers and 5 commercial
banking centers and 3 trust office locations throughout the Inland Empire,
LA County, Orange County and the Central Valley of California
Average Cost of Deposits = 0.10%
3
CVB Financial Corp. (CVBF) |
 Name
Position
Banking Experience
CVBF Service
Christopher D. Myers
President & CEO
29 Years
7 Years
Richard C. Thomas
Executive Vice President
Chief Financial Officer
4 Years
3 Years
James F. Dowd
Executive Vice President
Chief Credit Officer
36 Years
5 Years
David C. Harvey
Executive Vice President
Chief Operations Officer
24 Years
4 Years
David A. Brager
Executive Vice President
Sales Division
25 Years
10 Years
R. Daniel Banis
Executive Vice President
CitizensTrust
31 Years
1 Year
Yamynn DeAngelis
Executive Vice President
Chief Risk Officer
34 Years
26 Years
Richard Wohl
Executive Vice President
General Counsel
25 Years
2 Years
4
2Q Results 2013 | cbbank.com
Experienced Leadership |
 2Q
Results 2013 | cbbank.com Board of Directors
Name
CVB Experience
Age
Ronald Kruse -
Chairman
38 Years
74
Linn
Wiley
-
Vice
Chairman
21 Years
74
George Borba Jr.
1 Year
46
Steve Del Guercio
1 Year
51
Robert Jacoby
7 Years
71
Ray O’Brien
1 Year
56
San Vaccaro
13 Years
80
Chris
Myers
-
CEO
7 Years
51
5 |
 2Q
Results 2013 | cbbank.com Who is CVB Financial Corp.
|
 7
Source: SNL Financial
Rank
Name
Asset Size (3/31/13)
1
Wells Fargo
1,436,634
2
Union Bank
96,959
3
Bank of the West
62,493
4
First Republic Bank
35,083
5
City National Bank
27,434
6
OneWest Bank
25,369
7
SVB Financial
23,102
8
East West Bank
22,796
9
Cathay Bank
10,521
10
CapitalSource Inc.
8,483
11
11
CVB Financial Corp.
6,266
12
BBCN
5,839
13
Pacific Western Bank
5,300
14
Farmers & Merchants of Long Beach
5,071
15
Westamerica Bank
4,888
In millions
Largest Banks Headquartered in California
2Q Results 2013 | cbbank.com
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$ |
 Bank
Accomplishments & Ratings 145 Consecutive Quarters of Profitability
95 Consecutive Quarters of Cash Dividends
#6 Rated Bank: BankDirector Magazine
Bank Performance Scorecard (July 2012)
BauerFinancial Report
Five Star Rating (July 2013)
Fitch Rating
BBB (October 2012)
2Q Results 2013 | cbbank.com |
 2Q
Results 2013 | cbbank.com Our Markets |
 10
Existing Locations
40
Business Financial Centers
5
Commercial Banking Centers
3
CitizensTrust Locations
2Q Results 2013 | cbbank.com |
 2Q
Results 2013 | cbbank.com (000’s)
# of Center
Locations
Total Deposits
(6/30/12)
Total Deposits
(6/30/13)
Los Angeles County
17
$
1,926,234
$
1,892,050
Inland Empire
(Riverside & San Bernardino Counties)
10
$
1,652,751
$
1,762,673
Central Valley
11
$
792,246
$
812,072
Orange County
7
$
560,978
$
600,373
Other
0
$
234,277
$
256,795
Total
45
$5,166,486
$5,323,963
*Includes Customer Repurchase Agreements; Balance as of balance sheet date
Average Cost of Deposits (year to date)
0.16%
0.12%
Deposits* |
 2Q
Results 2013 | cbbank.com Non-Interest Bearing Deposits
(000’s)
2007
2008
2009
2010
2011
2012
2013
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4 Q1
Q2
Q3
Q4 Q1
Q2
Q3
Q4 Q1
Q2
Q3
Q4 Q1
Q2
Q3
Q4 Q1
Q2
1,000,000
1,200,000
1,400,000
1,600,000
1,800,000
2,000,000
2,200,000
2,400,000
2,600,000
$
$
$
$
$
$
$
$
$ |
 2Q
Results 2013 | cbbank.com 13
Source: Q2 2013 earnings release & other company filings, SNL Financial—peers
represent public CA , AZ, HI, NV, OR & WA banks with assets $2 -
$25 billion. Peer data as of 03/31/13
Deposit Cost Comparison
0.00%
0.50%
1.00%
1.50%
2.00%
2.50%
3.00%
Peers
CVBF
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
2007
2008
2009
2010
2011
2012
2013 |
 2Q
Results 2013 | cbbank.com Total Loans*
as of 6/30/2013
(000’s)
Non-
Covered
Loans*
Covered
Loans*
Total Loans*
%
Los Angeles County
$
1,187,442
$
13,838
$
1,201,280
35.65%
Central Valley
$
675,428
$
165,933
$
841,361
24.97%
Inland Empire
(Riverside & San Bernardino Counties)
$
587,831
$
998
$
588,829
17.48%
Orange County
$
466,674
$
0
$
466,674
13.85%
Other
$
260,596
$
10,600
$
271,196
8.05%
Total
$3,177,971
$191,369
$3,369,340
100.00%
*Prior to MTM discount, loan fees and loan loss reserve (Includes loans Held for
Sale) |
 (000’s)
3,800,000
3,600,000
3,400,000
3,200,000
3,000,000
2,800,000
2,600,000
2,400,000
2,200,000
2,000,000
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
2013
2012
2011
2010
2009
2Q Results 2013 | cbbank.com
Total Non-Covered Loans
$
$
$
$
$
$
$
$
$
$ |
 2Q
Results 2013 | cbbank.com 16
Source: Q2 2013 earnings release & company reports |Covered & Non Covered
Loan Portfolio Composition
Total Loans by Type
Municipal Lease
Finance
Receivables, 3.1%
Dairy, Livestock &
Agribusiness,
7.8%
Commercial &
Industrial, 16.3%
Construction RE,
1.4%
Commercial RE
Owner
Occupied, 23.4%
Commercial RE-
Non-Owner,
Multi-Family, 3.5%
SFR Mortgage,
5.4%
Other, 1.8%
37.3%
- |
 •
Residential Real Estate
•
Multi-Family
•
Asset Based Lending
17
New/Enhanced Lending Initiatives
2Q Results 2013 | cbbank.com |
 2Q
Results 2013 | cbbank.com Other Lending Areas
For Future Consideration/Expansion
•
SBA 7A
•
Residential and Commercial Construction
•
Medical Equipment/Office
•
Equipment Lending & Leasing
•
Private Banking
18 |
 2Q
Results 2013 | cbbank.com (000’s)
Net of Discount
184 million
17.5 million
Includes Loans Held for Sale
Total Covered Loans
500,000
400,000
300,000
200,000
100,000
-
800,000
700,000
600,000
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
2009
2010
2011
2012
2013
$
$
$
$
$
$
$
$
$
$
$ |
 2Q
Results 2013 | cbbank.com Non-Performing Assets
Non-Covered
20
(000’s)
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
2009
2010
2011
2012
2013
OREO
Non
Performing Loans
-
20,000
40,000
60,000
80,000
100,000
120,000
140,000
160,000
180,000
200,000
$
$
$
$
$
$
$
$
$
$
$- |
 21
(000’s)
800,000
700,000
600,000
500,000
400,000
300,000
200,000
100,000
-
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
2013
2012
2011
2010
2009
2Q Results 2013 | cbbank.com
Classified Loans
Non-Covered
$
$
$
$
$
$
$
$
$ |
 Profits
2Q Results 2013 | cbbank.com |
 2Q
Results 2013 | cbbank.com Net Income
Net Income After Taxes
20.4 million FHLB prepayment charge
(000’s)
2,500
5,000
7,500
10,000
12,500
15,000
17,500
20,000
22,500
25,000
27,500
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3Q4
Q1
Q2
2007
2008
2009
2010
2011
2012
2013
$
$
$
$
$
$
$
$
$
$
$
-
$
$ |
 (000’s)
2009
2010
2011
2012
6 Months to
6/30/2013
Net Interest Income
$222,264
$259,317
$234,681
$236,950
$107,184
Provision for Credit Losses
($80,500)
($61,200)
($7,068)
$
0
6,200
Other Operating
Income/Expenses (Net)
($52,515)
($111,378)
($106,809)
(
$
122,257)
($44,606)
Income Taxes
($23,830)
($23,804)
($39,071)
(
$
37,413)
($22,697)
Net Profit After Tax
$65,419
$62,935
$81,733
$77,280
$46,081
24
2Q Results 2013 | cbbank.com
Earnings
$ |
 2Q
Results 2013 | cbbank.com 25
*Normalized excludes accelerated accretion on covered loans
Normalized*
Net Interest Margin
1.50%
1.75%
2.00%
2.25%
2.50%
2.75%
3.00%
3.25%
3.50%
3.75%
4.00%
4.25%
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
2007
2008
2009
2010
2011
2012
2013 |
 2Q
Results 2013 | cbbank.com Expenses |
 2Q
Results 2013 | cbbank.com Expenses
27
*Includes
20.4 million FHLB prepayment charge
(000’s)
2010
2011
2012
6 Months to
6/30/2013
Salaries & Employee
Benefits
69,419
69,993
68,496
$34,388
Promotion &
Entertainment
6,084
4,977
4,869
$2,398
Stationary & Supplies
4,965
3,645
3,592
$1,848
Software Licenses &
Maintenance
5,031
3,669
4,269
$2,315
Professional Services
13,308
15,031
6,249
$2,983
OREO Expense
7,490
6,729
2,146
$363
Other
62,195
36,981
48,539*
$14,751
Total:
168,492
141,025
138,160
$59,046
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$ |
 2Q
Results 2013 | cbbank.com Bank Borrowings |
 2Q
Results 2013 | cbbank.com Type of Debt
Balance at
06/30/2013
Interest Rate
FHLB Advance*
199,070
4.52% Fixed
Other Borrowings (overnight)
0
Subordinated Debentures
CVB Statutory Trust III
25,774
3-Month LIBOR + 1.38%
Total
$224,844
Outstanding Debt
as of 06/30/2013
29
(000’s)
$
$
$
*FHLB Advance maturity is November, 28 2016. As of 7/16/13,
prepayment
penalty
was
estimated
at 22-23 million.
$ |
 Capital
2Q Results 2013 | cbbank.com |
 2Q
Results 2013 | cbbank.com Capital Ratios
Regulatory
Minimum Ratio
Regulatory
Well-Capitalized Ratio
March 31, 2013*
Tier 1 Risk-based Capital Ratio
4.0%
6.0%
18.36%
Total Risk-based Capital Ratio
8.0%
10.0%
19.63%
Tier 1 Leverage Ratio
4.0%
5.0%
11.54%
Tangible Capital Ratio
4.0%
5.0%
11.44%
Core Tier 1 Capital Ratio
17.21%
31
* CVB Financial Corp. –
Consolidated |
 2Q
Results 2013 | cbbank.com Securities & Investments
|
 Source: Q2
2013 earnings release. As of 6/30/2013 securities held-to-maturity were valued at
approximately
$
1.9 million |
Yield on securities represents the fully taxable equivalent
*Securities Available For Sale
Securities portfolio totaled $2.43 billion at 6/30/2013. The portfolio represents 37.9% of the Bank’s total
assets
Virtually all of the Bank’s mortgage-backed securities were issued by
Freddie Mac or Fannie Mae which have the implied guarantee of the U.S.
government. 99% of the Bank’s municipal portfolio contains securities
which have an underlying rating of investment grade. California municipals represent only 4%
of the municipal bond portfolio
Yield on securities
portfolio = 2.24%
for the 2nd Quarter 2013
Securities Portfolio*
--
2.43 Billion--
CMO’s /
REMIC’s
17.58%
Trust Preferred
0.20%
Municipal
Bonds 24.75%
Government
Agency &
GSEs 14.85%
MBS 42.62%
2Q Results 2013 | cbbank.com
$ |
 Securities Portfolio*
2.43 Billion
Mark-to-Market (Pre-tax) (000’s)
*Securities Available For Sale
6,927
90,000
80,000
70,000
60,000
50,000
40,000
30,000
20,000
10,000
0
Jun
09
Sep
09
Dec
09
Mar
10
Jun
10
Sep
10
Dec
10
Mar
11
Jun
11
Sep
11
Dec
11
Mar
12
Jun
12
Sep
12
Dec
12
Mar
13
Jun
13
2Q Results 2013 | cbbank.com
$
$
$
$
$
$
$
$
$
$
$
$ |
 CVBF
Assets 35
*Includes overnight funds held at the Federal Reserve, Interest earning -
due from Correspondent Banks, other short-term money market
accounts or certificates of deposit
Loans,
50.7%
Securities,
37.9%
Goodwill &
Intangibles
0.9%
Other, 7.9%
Fed
Balance*,
2.6%
Fed
Balance*,
2.4%
Other,
4.6%
Goodwill &
Intangibles
0.7%
Loans,
49.9%
Securities
42.4%
12/31/06
6.1 Billion
6/30/13
6.4 Billion
2Q Results 2013 | cbbank.com
$
$ |
 2Q
Results 2013 | cbbank.com Yield on Securities vs. Yield on Loans
*Excluding Discount Accretion
0.00%
1.00%
2.00%
3.00%
4.00%
5.00%
6.00%
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
2009
2010
2011
2012
2013
Yield on Loans*
Yield on Securities |
 2Q
Results 2013 | cbbank.com CVBF Liabilities
*Includes Customer Repurchase Agreements
Total
Deposits*,
61.4%
Borrowings,
36.0%
Junior
subordinated
Debentures,
1.9%
Other
Liabilities,
0.7%
Other
Liabilities,
2.2%
Borrowings,
3.5%
Total
Deposits,
93.8%
Junior
subordinated
Debentures,
0.5%
12/31/06
5.7 Billion
$
6/30/13
5.5 Billion
$ |
 Our
Growth Strategy 2Q Results 2013 | cbbank.com |
 2Q
Results 2013 | cbbank.com Citizens Business Bank will strive to become the
dominant financial services company operating
throughout the state of California, servicing the
comprehensive financial needs of successful
small to medium sized businesses and their
owners.
39
Our Vision |
 2Q
Results 2013 | cbbank.com Target Customer
The best privately-held and/or family-owned
businesses throughout California
Annual revenues of
1-200 million
Top 25% in their respective industry
Full relationship banking
Build 20-year relationships
40
$ |
 2Q
Results 2013 | cbbank.com 41
DeNovo
Same Store
Sales
Acquisitions
--Banks--
--Trust--
Three Areas of Growth |
 2Q
Results 2013 | cbbank.com •
Target size:
200 million to
2 billion in assets
•
Financial & Strategic
•
In-market and/or adjacent geographic market
(California only)
Acquisition Strategy
--Banks--
--Trust/Investment--
•
Target size: AUM of
200 million to
1 billion
•
In California
--Banking Teams--
•
In-
market & ‘new’
markets
$
$
$
$ |
 2Q
Results 2013 | cbbank.com Our ‘Critical Few’
•
Loan Growth
•
Expand Credit Product Offerings & Capabilities
•
Build Core Deposits
•
Drive Service Charge & Fee Income Growth
•
Manage Operating Efficiency
•
Grow Through Acquisition |
 2Q
Results 2013 | cbbank.com Copy of presentation at
www.cbbank.com |