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| 8-K - CTBI 2016 SHAREHOLDERS' PRESENTATION 8-K - COMMUNITY TRUST BANCORP INC /KY/ | ctbi2016sharepres8k.htm |
2016AnnualShareholders’Presentation
Cautionary Statement Information provided herein by CTBI contains “forward-looking” information. CTBI cautions that any forward-looking statements made are not guarantees of future performance and that actual results may differ materially from those in the forward-looking statements. Please refer to CTBI’s 2015 Annual Report on Form 10-K, Cautionary Statement Regarding Forward Looking Statements for additional information. 2
12/31/15 4/22/16Market Capitalization $613.1 million $641.1 millionDividend Yield ¹ 3.55% 3.40%P/E Ratio ² 13.1x 13.8%Competitive Position2nd largest Kentucky domiciled bank holding company#1 in Kentucky in deposit market share of all Kentucky domiciled FDIC insured institutions 6th largest bank in Kentucky in terms of deposit market share of all FDIC insured institutions Key Metrics ¹ Dividend yield as of 4/22/16 utilizes annualized dividends as of 3/31/16 ² P/E Ratio as of 4/22/16 utilizes annualized earnings as of 3/31/16 3
Our Banking Franchise Serving customers in 80 branch locations in 35 counties throughout Kentucky, Tennessee, and West Virginia, including 5 trust offices in Kentucky and Tennessee 4
Our Banking Franchise Central Region Eastern Region Northeastern RegionLoans - $634 million Loans - $886 million Loans - $341 millionDeposits - $705 million Deposits - $1.3 billion Deposits - $497 million• Danville • Floyd/Knott/Johnson • Advantage Valley• Lexington • Hazard • Ashland• Mt. Sterling • Pikeville • Flemingsburg• Richmond • Tug Valley • Summersville• Versailles • Whitesburg• Winchester South Central Region CTICLoans - $620 million Assets Under Management - $1.9 billion (including $0.6 bill CTB)Deposits - $670 million Revenues - $13.3 million• Campbellsville • Ashland• LaFollette • LaFollette• Middlesboro • Lexington• Mt. Vernon • Pikeville• Williamsburg • Versailles Financial data as of December 31, 2015 5
Trust Assets Under Management &Trust Revenue Assets in billionsRevenue in millions 6 Includes CTB portfolio
7 2015 Performance
2015 Performance Summary Budget ResultsEarnings $45.4 million $46.4 millionEPS $2.59 per share $2.66 per shareROAA 1.21% 1.23%ROAE 9.81% 9.97%Assets $3.81 billion $3.90 billionLoans $2.84 billion $2.87 billionDeposits $3.13 billion $3.23 billionShareholders’ equity $472.0 million $475.6 million 8
Shareholder Value 9
2015 cash dividends increased 3.3%2.1% compound growth rate for past five yearsDecember 31, 2015 cash dividend yield was 3.55%Cash dividend increased to $0.31 per share effective October 1, 2015 Dividends Per Share *2016 is projected DPS 2.1% 10
Shareholders’ Equity (in millions) Shareholders’ equity has increased 29.6% during the past five years7.0% compound growth rate for the past five years2016 goal for shareholders’ equity - $485 to $520 million 7.0% 11
Book ValuePer Share Tangible Common Equity/Assets 12
Total Market Capitalization All data is as of year-end except 2016 which is as of March 31, 2016. Peer data not available as of March 31, 2016.Peer data obtained from SNL Financial; peer group consists of publicly traded regional bank holding companies with an average asset size of $3.9 billion, as defined in our Proxy Statement. (in millions) Price to Tangible Book Value 2011 2012 2013 2014 2015 3/31/16 CTBI 1.51x 1.53x 2.06x 1.67x 1.50x 1.48x Peer 1.19x 1.39x 1.72x 1.72x 1.71x N/A 13
5 Year Cumulative Total ReturnComparison of CTBI, NASDAQ Stock Market (U.S.), and NASDAQ Bank Stocks An investment in CTBI stock on December 31, 2010 would have outperformed the NASDAQ Bank Stocks Index but not the NASDAQ Stock Market (U.S.) at December 31, 2015. 14
Comparison to Russell 2000 Indexof Small Cap Companies Return to Investors 3-, 5-, and 10-year total returns annualized December 31, 2015 15
Core Value Long-Term Investment 12 stock splits and 10 stock dividends35 years of consecutive increases in cash dividends5-year compound growth rate of cash dividends 2.1%Stock included in the NASDAQ Global Select Market, NASDAQ Dividend Achievers Index, and NASDAQ Bank Stock IndexRecognized as one of “America’s 50 Most Trustworthy Financial Companies” for two consecutive years and ranked 1st and 2nd in the “Small Cap” category in the years 2014 and 2015, respectivelyCTBI shareholders include164 institutional investors (including CTIC – 10.6%) hold 9.6 million shares (53.1%)216 mutual funds hold 4.6 million shares (26.0%) Data as of December 31, 2015 16
Earnings Review 17
EPS increased 6.4% from 2014 to 20152016 EPS goal - $2.72 to $2.82 per share Earnings Per Share 18
Return on Average Assets Peer data obtained from the Federal Reserve Bank Holding Company Performance Report as of 12/31/2015 for bank holding companies with consolidated assets of $3 billion to $10 billion. 19
(in millions) Net Income Net income increased 7.4% from 2014 to 20152016 goal for net income - $48.0 to $49.2 million 20
Revenues (in millions) 2015 revenues increased 1.1% from 20142016 goal for revenues - $183.0 to $189.6 million 21
2015 noninterest income increased 3.8% from 2014Increases in gains on sales of loans, deposit service charges, trust revenue, and loan related fees, and decreased securities losses2016 goal for noninterest revenue – 26.0% to 26.5% of total revenue Noninterest Incomeas a % of Total Revenue (in millions) 22
2015 net interest revenue increased by 0.1% from 2014Net interest margin decreased 11 basis pointsAverage earning assets increased $102.1 million, or 3.0% (in millions) Net Interest Revenue 23
Net Interest Margin Pressure on the margin1-year cumulative gap position at 12/31/15 – (6.43)% % of assets repricingWithin 30 days 31.76%% of liabilities repricing Within 30 days 15.42%Within 90 days 25.96%Within 180 days 36.62% Peer data obtained from the Federal Reserve Bank Holding Company Performance Report as of 12/31/2015 for bank holding companies with consolidated assets of $3 billion to $10 billion. 24
Net Noninterest Expenseas a % of Average Earning Assets Noninterest Expense & Efficiency Ratio (in millions) (in millions) Peer data obtained from the Federal Reserve Bank Holding Company Performance Report as of 12/31/2015 for bank holding companies with consolidated assets of $3 billion to $10 billion. 25
Balance Sheet Review 26
Total assets at 12/31/15 increased $180.2 million, or 4.8%, from 12/31/2014Loans increased $140.1 million or 5.1%Investment portfolio decreased $45.3 million or 7.0%Deposits growth $122.6 million or 3.9%2016 goal for total assets - $3.80 to $4.20 billion (in billions) Total Assets 27
(in billions) Total Loans Total loans at 12/31/15 increased 5.1% from 12/31/14Loan production for the year totaled $0.8 billion2016 goal for total loans - $2.90 to $3.10 billion December 31, 2015 Loan PortfolioMix 28
Concentrations of Creditas a % of Total Loans December 31, 2015 * As a percentage of funded exposure 29
Net Charge-offsas a % of Average Loans NonperformingLoansas a % of Total Loans Peer data obtained from the Federal Reserve Bank Holding Company Performance Report as of 12/31/2015 for bank holding companies with consolidated assets of $3 billion to $10 billion. December 31, 2015 30
Nonperforming Assetsas a % of Total Assets Loan Loss Reserveas a % of Net Loans $40.7 million in other real estate owned Peer data obtained from the Federal Reserve Bank Holding Company Performance Report as of 12/31/2015 for bank holding companies with consolidated assets of $3 billion to $10 billion. 31
Total Other Real Estate Owned Sales of foreclosed properties for the year ended 12/31/15 $13.4 millionNew bookings in 2015 $18.8 millionProperties under contract to sell $3.0 million (in millions) 32
(in billions) Total Depositsincluding Repurchase Agreements 2016 goal for total deposits including repurchase agreements - $3.20 to $3.40 billion Total Depositsincluding Repurchase Agreements December 31, 2015 33
1st Quarter 2016 Review 34
Earnings Per Share 35
(in millions) Net Income 36
Net interest incomeIncreased $0.4 million year over yearIncreased $0.1 million quarter over quarterProvision for loan lossesDecreased $0.1 million year over yearDecreased $0.1 million quarter over quarterNoninterest incomeIncreased $0.2 million year over yearDecreased $0.8 million quarter over quarterNoninterest expenseIncreased $0.4 million year over yearIncreased $0.5 million quarter over quarter Net Income 37
(in millions) Noninterest Income Q-O-QDecreases in gains on sales of loans, deposit service charges, trust revenue, and loan related feesY-O-YIncrease in deposit service charges 38
(in millions) Noninterest Expense Q-O-Q$0.8 million increase in personnel expense$0.5 million decrease in net other real estate owned expenseY-O-Y$0.5 million increase in personnel expense 39
Loan portfolio increased at an annualized rate of 2.1% during the quarterCommercial loans decreased $0.2 millionIndirect loans increased $18.6 millionResidential loans decreased $2.8 millionConsumer direct loans decreased $0.3 millionLoan increase from prior year first quarter 5.2% (in billions) Total Loans 40
Deposits, including repurchase agreements, increased an annualized 7.6% from prior quarter and 3.4% from prior year first quarter (in billions) Total Depositsincluding Repurchase Agreements 41
Nonperforming Loansas a % of Total Loans 42
Nonperforming Assetsas a % of Total Assets 43
Net Charge-offsas a % of Average Loans (annualized) 44
Efficiency Ratio 45
Key Strategic Initiatives 46
Operational Priorities Continuing focus on improving asset qualityLiquidation of other real estate ownedBuild core earnings capacityQuality loan growthLow cost deposit growthIncrease noninterest incomeWealth managementBrokerageLife insuranceMaintain net interest marginCompliance managementOperational efficiencyExpense controlNoninterest revenue growth 47
CTBI: 2016 Outlook Net Income $48.0 - $49.2 millionEarnings Per Share $2.72 - $2.82 per shareROAA 1.22% - 1.28% ROAE 9.4% - 10.4% Assets $3.8 - $4.2 billionLoans $2.9 - $3.1 billionDeposits $3.2 - $3.4 billionShareholders’ Equity $485 - $520 million 48
CTBI’s Franchise Value History of solid investor returnsHistorically strong capital positionInvestor focused dividend policyDividend Achievers IndexConsistent financial performanceCommunity banking strategyEconomic diversity in the markets we serveStrong experienced management team and over 1,000 dedicated employeesOur shareholders 49
To Our Shareholders Your management has a Strategic Plan for the performance and operations of your company. Success will be attained by the execution of this plan, not just by management, but by approximately 1,000 employees. The continuing support by you, our shareholders, by referring your friends, neighbors, and business associates to do business with your bank, is invaluable to the execution of our plans for the performance of your Company. 50
