FIFTH THIRD BANCORP - FORM 8-K - EX-99.1

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8-K - FORM 8-K - FIFTH THIRD BANCORP	d732752d8k.htm

Deutsche Bank Financial Services

Investor Conference

Tayfun Tuzun

Executive Vice President & Chief Financial Officer

May 28, 2014

Please refer to earnings release dated April 17, 2014 and

10-Q dated May 8, 2014 for further information

Exhibit 99.1

Strong core businesses driving results

Wholesale

bank

Consumer

lending

Branch

banking

•

Specialized industry verticals, treasury

management, and capital markets driving loan

growth and corporate banking revenue

•

Transitioned from refi-focused mortgage

operation to more traditional purchase/refi

split

•

#5 bank indirect auto originator in the

country¹

•

Actively managing product and distribution

model to address changing customer needs

and operating environment

•

Improving efficiency while driving deposit

growth and improving customer service

Source: Inside Mortgage Finance

Retail cross sell service set includes Checking, Savings, CD, Home Equity, Direct/Indirect Loan, Mortgage (incl EHR), Credit Card, Annuity, Brokerage, Insurance, Early Access, Debt

Protection, ID Alert, Debit Card, Access 360, Online Bill Pay, Direct Deposit, Mobile Banking and Internet Banking. Households with Access 360 only are not included.

Avg Bancorp cons deposits

($MM)

Retail cross sell

Corporate banking

revenue ($B)

Investment

Advisors

•

Investment and retirement focus driving

wealth management

•

Distribution model oriented to mass affluent;

recurring revenue streams

Investment Advisory

revenue ($B)

Retail brokerage revenue

($MM)

Indirect auto footprint

Avg Bancorp cons loans

($MM)

Avg Bancorp coml loans

($MM)

40.5

45.3

FY11

FY13

4.5

5.5

FY11

FY13

350

400

FY11

FY13

375

393

FY11

FY13

117

144

FY11

FY13

FY09

FY13

36 states

45 states

36.1

38.5

FY11

FY13

44.1

50.6

FY11

FY13

Repositioning consumer bank

with investments and strategic changes

Improving the customer experience

while reducing the cost to serve

Growing sales through launch of a

hybrid universal banker role

Consumer deposit activity

Transaction volume by ATM and Mobile channels

Year-over-Year Sales Production

1Q13 vs 1Q14 Universal Banker Pilot Results

Total EOP Consumer Deposits ($B)

excludes CDs

Retail Banking Employees

15-month change (Dec. 2012 –

Mar. 2014)

12%

19%

27%

10%

15%

20%

25%

30%

March 2012

March 2013

March 2014

19%

10%

15%

20%

Non-pilot

Branches

Pilot Branches

$43.4

$46.3

$47.6

$10

$20

$30

$40

$50

1Q12

1Q13

1Q14

(10%)

(19%)

(20%)

(10%)

10%

Total Banking

Center Staff

Total Service FTE

Total Sales FTE

Investing in Commercial Banking

to improve capabilities and diversification

Middle Market

Mid Corporate

Specialty Groups

Target customers:

$5 million to $500 million revenue

Target customers:

$500 million to $2 billion revenue

Target customers:

Healthcare, Energy,

International, and CRE

industry specializations

Investments made in sales force

and service efficiency

Investments made in capital

markets capabilities, “lead left”

strategy and sales force

Investments made in sales

force and specialized product

development

Local affiliate delivery model

National Coverage Model

National and Specialty Model

Supported by Treasury

Management and Retirement Plan

Services

Providing complex solutions;

supported by Capital Markets

Advisory, Treasury Management,

and vertical expertise

Also includes Structured

Lending, Dealer Financing,

Food and Transportation, and

Leasing

3% increase in average C&I loans

since 1Q12

13 sequential quarters of

average loan growth

Healthcare portfolio approx.

$4 billion; Energy portfolio

over $650 million

Commercial Banking –

financial performance

Total Revenue grew 13% over 2 years

Capital Markets fees increased notably with entry into debt capital markets

Note: Prior periods have not been restated for changes in the structure of the reporting units that occurred in 1Q14.

$49.6B

$45.9B

$53.1B

1,357

1,432

1,487

641

737

780

500

1,000

1,500

2,000

2,500

2011

2012

2013

Total Revenue ($MM)

Net Interest Income

Noninterest Income

$10

$20

$30

$40

$50

$60

1Q12

1Q13

1Q14

Total Avg. Commercial Loans ($B)

Middle Market

Energy

Healthcare

Large Corporate

Mid Corporate

CRE

Other

Capital management –

core focus

Non-GAAP measure; See Reg. G reconciliation in appendix.

Capital

ratios

presented

under

current

U.S.

capital

regulations.

The

pro

forma

Basel

III

Tier

common

equity

ratio

management’s

estimate

based

upon

its

current

interpretation

recent

prospective regulatory capital requirements approved in July 2013.

$710MM common

stock repurchases

(net of $398MM

shares issued

related to Series G

conversion)

$407MM common

dividends declared

$212MM common

stock repurchases

utilizing AT Vantiv

gains

Common Shares Outstanding (MM)

and Tangible Book Value per share

2014 CCAR plan designed to maintain regulatory common equity capital ratios generally at current levels

$200

$400

$600

$800

$1,000

$1,200

$1,400

2013 Net Payouts

($MM)

913

901

888

878

858

$12.62

$12.69

$13.09

$13.00

$13.40

650

675

700

725

750

775

800

825

850

875

900

925

$11.00

$11.50

$12.00

$12.50

$13.00

$13.50

$14.00

1Q13

2Q13

3Q13

4Q13

1Q14

Common Shares O/S

TBV per share

Ongoing impact of Vantiv ownership on capital management

•

Total gains / earnings recognized to date ~$3B

•

Currently own 26% interest in Vantiv Holding, LLC, convertible to Vantiv, Inc. shares (NYSE: VNTV)

–

Carrying (book) value of $437MM as of 3/31/14; ownership (market) value of ~$1.5B as of 3/31/14

•

Ongoing equity method earnings

•

Warrant to purchase additional shares in Vantiv carried as a derivative asset at fair value of $348MM as of 3/31/14

•

Annual payment corresponding with tax benefits accruing to Fifth Third associated with the tax receivable

agreement (TRA)

–

Vantiv reported FITB TRA at a gross value of $551MM as of 1Q14; FITB realized $9MM in 4Q13

Investment thesis

Healthy balance

sheet with strong

growth potential

Balanced capital

management

supporting

growth and

shareholder

returns

Strategic

investments in

key businesses

providing

momentum

Long history of

disciplined

expense

management

Cautionary statement

This report contains statements that we believe are “forward-looking statements” within the meaning of Section 27A of the Securities

Act of 1933, as amended, and Rule 175 promulgated thereunder, and Section 21E of the Securities Exchange Act of 1934, as

amended, and Rule 3b-6 promulgated thereunder. These statements relate to our financial condition, results of operations, plans,

objectives, future performance or business. They usually can be identified by the use of forward-looking language such as “will likely

result,” “may,” “are expected to,” “is anticipated,” “estimate,” “forecast,” “projected,” “intends to,” or may include other similar words or

phrases such as “believes,” “plans,” “trend,” “objective,” “continue,” “remain,” or similar expressions, or future or conditional verbs

such as “will,” “would,” “should,” “could,” “might,” “can,” or similar verbs. You should not place undue reliance on these statements, as

they are subject to risks and uncertainties, including but not limited to the risk factors set forth in our most recent Annual Report on

Form 10-K. When considering these forward-looking statements, you should keep in mind these risks and uncertainties, as well as

any cautionary statements we may make. Moreover, you should treat these statements as speaking only as of the date they are

made and based only on information then actually known to us.

There are a number of important factors that could cause future results to differ materially from historical performance and these

forward-looking statements. Factors that might cause such a difference include, but are not limited to: (1) general economic

conditions and weakening in the economy, specifically the real estate market, either nationally or in the states in which Fifth Third,

one or more acquired entities and/or the combined company do business, are less favorable than expected; (2) deteriorating credit

quality; (3) political developments, wars or other hostilities may disrupt or increase volatility in securities markets or other economic

conditions; (4) changes in the interest rate environment reduce interest margins; (5) prepayment speeds, loan origination and sale

volumes, charge-offs and loan loss provisions; (6) Fifth Third’s ability to maintain required capital levels and adequate sources of

funding and liquidity; (7) maintaining capital requirements may limit Fifth Third’s operations and potential growth; (8) changes and

trends in capital markets; (9) problems encountered by larger or similar financial institutions may adversely affect the banking

industry and/or Fifth Third; (10) competitive pressures among depository institutions increase significantly; (11) effects of critical

accounting policies and judgments; (12) changes in accounting policies or procedures as may be required by the Financial

Accounting Standards Board (FASB) or other regulatory agencies; (13) legislative or regulatory changes or actions, or significant

litigation, adversely affect Fifth Third, one or more acquired entities and/or the combined company or the businesses in which Fifth

Third, one or more acquired entities and/or the combined company are engaged, including the Dodd-Frank Wall Street Reform and

Consumer Protection Act; (14) ability to maintain favorable ratings from rating agencies; (15) fluctuation of Fifth Third’s stock price;

(16) ability to attract and retain key personnel; (17) ability to receive dividends from its subsidiaries; (18) potentially dilutive effect of

future acquisitions on current shareholders’ ownership of Fifth Third; (19) effects of accounting or financial results of one or more

acquired entities; (20) difficulties from Fifth Third’s investment in, relationship with, and nature of the operations of Vantiv, LLC; (21)

loss of income from any sale or potential sale of businesses that could have an adverse effect on Fifth Third’s earnings and future

growth; (22) ability to secure confidential information and deliver products and services through the use of computer systems and

telecommunications networks; and (23) the impact of reputational risk created by these developments on such matters as business

generation and retention, funding and liquidity.

You should refer to our periodic and current reports filed with the Securities and Exchange Commission, or “SEC,” for further

information on other factors, which could cause actual results to be significantly different from those expressed or implied by these

forward-looking statements.

Appendix

Pre-tax

pre-provision

earnings¹

PPNR trend

Non-GAAP measure; see Reg. G reconciliation in appendix.

Prior quarters include similar adjustments.

There

are

limitations

the

usefulness

credit-adjusted

PPNR,

including

the

significant

degree

which

changes

credit

and

fair

value

are

integral,

recurring

components

the

Bancorp’s

core

operations

financial

institution.

This

measure

has

been

included

herein

facilitate

greater

understanding

the

Bancorp’s

financial

condition.

Note: 1Q14, 2Q13, and 1Q13 included the impact of $3MM,

$20MM, and $22MMM, respectively in mortgage repurchase provision. 4Q13 and 3Q13 also included benefits to the mortgage

repurchase

provision

$28MM

and

$4MM,

respectively.

These

impacts

are

reflected

“Credit-related

items”

and

“Adjusted

Efficiency

Ratio”

listed

above.

PPNR declined 17% sequentially, reflecting impact of $83MM and $9MM in net detriments to 1Q14 and 4Q13,

respectively. Excluding those items, adjusted PPNR declined 5% from 4Q13, driven by seasonal increase in

FICA

and

unemployment

tax

expense

and

lower

mortgage

banking

net

revenue.

PPNR reconciliation

($ in millions)

1Q13

2Q13

3Q13

4Q13

1Q14

Income before income taxes (U.S. GAAP) (a)

$591

$841

$604

$561

$438

Add: Provision expense (U.S. GAAP) (b)

PPNR (a) + (b)

$653

$905

$655

$614

$507

In noninterest income:

Gain from sales of Vantiv shares

(242)

(85)

Vantiv warrant valuation

(34)

(76)

(6)

(91)

Other Vantiv-related income

(9)

Valuation of 2009 Visa total return swap

(1)

Sale of certain Fifth Third funds

(7)

BOLI settlement

(10)

Securities (gains) / losses

(17)

(2)

(7)

In noninterest expense:

Debt extinguishment (gains) / losses

Severance expense

Large bank assessment fees

Gain on sale of affordable housing investments

(9)

(2)

(1)

Donation to Fifth Third Foundation

Litigation reserve charges

Adjusted PPNR

$608

$632

$603

$623

$590

Credit-related items:

In noninterest income

In noninterest expense

(12)

Credit-adjusted PPNR

$642

$673

$624

$616

$609

$608

$632

$603

$623

$590

$100

$200

$300

$400

$500

$600

$700

1Q13

2Q13

3Q13

4Q13

1Q14

Adjusted PPNR

PPNR $653 $905 $655 $614 $507

Adjustments

remove

(benefit)

detriment

Credit quality overview

$112

Net charge-offs ($MM)

$109

$168

4Q13 and 1Q14 net charge-offs elevated;

broader portfolio still at low levels

$133

NCO ratio

0.63%

0.51%

0.49%

0.67%

0.76%

$148

HFI Nonperforming assets ($MM)

$1,210

$1,150

$1,014

$946

$980

NPAs down 22% from 1Q13;

lowest level since 2007

Reserve Coverage

Accruing Past Due ($MM)

$470

$410

$414

$337

$379

Includes 1Q14 provision expense of $69MM;

reserve coverage levels remain strong.

Total delinquencies declined 28% from 1Q13;

remain at very low levels

NPA ratio 1.41%

306

258

276

243

164

152

156

103

$50

$100

$150

$200

$250

$300

$350

$400

$450

$500

1Q13

2Q13

3Q13

4Q13

1Q14

30-89 Days Past Due

90+ Days Past Due

828

794

680

607

595

382

356

334

373

351

$250

$500

$750

$1,000

$1,250

1Q13

2Q13

3Q13

4Q13

1Q14

Commercial

Consumer

105

$25

$50

$75

$100

$125

$150

$175

1Q13

2Q13

3Q13

4Q13

1Q14

Commercial

Consumer

$1,783

$1,735

$1,677

$1,582

$1,483

2.08%

1.99%

1.92%

1.79%

1.65%

$500

$1,000

$1,500

$2,000

0.00%

0.50%

1.00%

1.50%

2.00%

2.50%

3.00%

3.50%

1Q13

2Q13

3Q13

4Q13

1Q14

Allowance for Loan & Lease Losses (ALLL) ($MM)

ALLL / Loans and Leases

1.32%

1.16%

1.10%

1.05%

Regulation G Non-GAAP reconciliation

Fifth Third Bancorp and Subsidiaries

Regulation G Non-GAAP Reconcilation

$ and shares in millions

(unaudited)

March

December

September

June

March

2014

2013

Income before income taxes (U.S. GAAP)

$438

$561

$604

$841

$591

Add:

Provision expense (U.S. GAAP)

Pre-provision net revenue (a)

507

614

655

905

653

Net income available to common shareholders (U.S. GAAP)

309

383

421

582

413

Add:

Intangible amortization, net of tax

Tangible net income available to common shareholders

310

384

422

583

414

Tangible net income available to common shareholders (annualized) (b)

1,257

1,523

1,674

2,338

1,679

Average Bancorp shareholders' equity (U.S. GAAP)

14,862

14,757

14,440

14,221

13,779

Less:

Average preferred stock

(1,034)

(703)

(593)

(717)

(398)

Average goodwill

(2,416)

Average intangible assets

(19)

(20)

(22)

(24)

(26)

Average tangible common equity (c)

11,393

11,618

11,409

11,064

10,939

Total Bancorp shareholders' equity (U.S. GAAP)

14,826

14,589

14,641

14,239

13,882

Less:

Preferred stock

(1,034)

(593)

(991)

(398)

Goodwill

(2,416)

Intangible assets

(18)

(19)

(21)

(23)

(25)

Tangible common equity, including unrealized gains / losses (d)

11,358

11,120

11,611

10,809

11,043

Less: Accumulated other comprehensive income

(196)

(82)

(218)

(149)

(333)

Tangible common equity, excluding unrealized gains / losses (e)

11,162

11,038

11,393

10,660

10,710

Total assets (U.S. GAAP)

129,654

130,443

125,673

123,360

121,382

Less:

Goodwill

(2,416)

Intangible assets

(18)

(19)

(21)

(23)

(25)

Tangible assets, including unrealized gains / losses (f)

127,220

128,008

123,236

120,921

118,941

Less: Accumulated other comprehensive income / loss, before tax

(302)

(126)

(335)

(229)

(512)

Tangible assets, excluding unrealized gains / losses (g)

126,918

127,882

122,901

120,692

118,429

Common shares outstanding (h)

848

855

887

851

875

Ratios:

Return on average tangible common equity (b) / (c)

11.0%

13.1%

14.7%

21.1%

15.4%

Tangible common equity (excluding unrealized gains/losses) (e) / (g)

8.79%

8.63%

9.27%

8.83%

9.03%

Tangible common equity (including unrealized gains/losses) (d) / (f)

8.93%

8.69%

9.42%

8.94%

9.28%

Tangible book value per share (d) / (h)

13.40

13.00

13.09

12.69

12.62

For the Three Months Ended

Regulation G Non-GAAP reconciliation

Fifth Third Bancorp and Subsidiaries

Regulation G Non-GAAP Reconcilation

$ and shares in millions

(unaudited)

March

December

September

June

March

2014

2013

2012

Total Bancorp shareholders' equity (U.S. GAAP)

$14,826

$14,589

$14,641

$14,239

$13,882

Goodwill and certain other intangibles

(2,490)

(2,492)

(2,496)

(2,504)

Unrealized gains

(196)

(82)

(218)

(149)

(333)

Qualifying trust preferred securities

810

Other

(18)

Tier I capital

12,182

12,094

12,762

12,426

11,878

Less:

Preferred stock

(1,034)

(593)

(991)

(398)

Qualifying trust preferred securities

(60)

(810)

Qualifying noncontrolling interest in consolidated subsidiaries

(1)

(37)

(39)

(38)

Tier I common equity (a)

11,087

10,963

11,320

10,587

10,632

Risk-weighted assets, determined in accordance with

prescribed regulatory requirements (b)

116,622

116,736

114,544

112,285

109,626

Ratio:

Tier I common equity (a) / (b)

9.51%

9.39%

9.88%

9.43%

9.70%

Basel III -

Estimated Tier 1 common equity ratio

March

December

September

2014

2013

Tier 1 common equity (Basel I)

$11,087

$10,963

$11,320

Add:

Adjustment related to capital components

$99

$82

$88

Estimated Tier 1 common equity under final Basel III rules without AOCI (opt out)(c)

$11,186

$11,045

$11,408

Add:

Adjustment related to AOCI

$196

$82

$218

Estimated Tier 1 common equity under final Basel III rules with AOCI (non opt out)(d)

$11,382

$11,127

$11,626

Estimated risk-weighted assets under final Basel III rules (e)

122,659

122,851

120,447

Estimated

Tier

common

equity

ratio

under

final

Basel

III

rules

(opt

out)

(c)

(e)

9.12%

8.99%

9.47%

Estimated

Tier

common

equity

ratio

under

final

Basel

III

rules

(non

opt

out)

(d)

(e)

9.28%

9.06%

9.65%

For the Three Months Ended

(c), (d)

Under the final Basel III rules, non-advanced approach banks are permitted to make a one-time election to opt out of the requirement to include AOCI in Tier 1 common equity. Other

adjustments include mortgage servicing rights and deferred tax assets subject to threshold limitations and deferred tax liabilities related to intangible assets.

(e)

Key differences under Basel III in the calculation of risk-weighted assets compared to Basel I include: (1) Risk weighting for commitments under 1 year; (2) Higher risk weighting for

exposures to securitizations, past due loans, foreign banks and certain commercial real estate; (3) Higher risk weighting for mortgage servicing rights and deferred tax assets that are

under certain thresholds as a percent of Tier 1 capital; and (4) Derivatives are differentiated between exchange clearing and over-the-counter and the 50% risk-weight cap is removed.

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