Attached files
| file | filename |
|---|---|
| 8-K - 8-K - CVB FINANCIAL CORP | d35851d8k.htm |
| EX-99.2 - EX-99,2 - CVB FINANCIAL CORP | d35851dex992.htm |
 2Q Results 2015 | cbbank.com July 2015 Exhibit 99.1 |
 2Q Results 2015 | cbbank.com
Safe Harbor
2 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 the
Company’s future financial position and operating results. These forward-looking statements are subject to risks and uncertainties that could cause actual results, performance and/or achievements to differ materially from those projected. These risks and
uncertainties include, but are not limited
to, local, regional, national and international economic and market conditions and events and the impact they may have on us and our customers; our ability to attract deposits and other sources of funding or liquidity; supply and demand for real
property inventory and periodic
deterioration in values of California real estate, both
residential and commercial; a prolonged slowdown or decline in construction or sales activity; changes in the financial performance and/or condition of our borrowers or certain key vendors or counterparties; changes in the level of nonperforming assets and any accompanying reserves and/or charge-offs; the cost or effect of
acquisitions we may make; the effect of
changes in laws, regulations and relevant judicial
decisions (including laws, regulations and judicial decisions concerning financial reforms, taxes, bank capital levels, securities and securities trading and hedging, employment, executive compensation, insurance, vendor management and information security) with which we and our subsidiaries must or believe we should comply; changes in estimates of future reserve requirements and minimum capital requirements based upon the periodic review thereof under relevant regulatory and accounting requirements, including changes in the Basel Committee framework establishing capital standards for credit, operations and
market risk; inflation, interest rate,
securities
market
and
monetary
fluctuations;
changes
in
government
interest
rates
or
monetary
policies;
changes
in
the
amount
and
availability of
deposit insurance; cyber-security threats, including
loss of system functionality or theft or loss of Company or customer data or money; political instability; acts of war or terrorism, or natural disasters, such as earthquakes, or the effects of pandemic diseases; the timely development and acceptance of new banking products and services and the perceived overall value of these products
and services by customers and potential
customers; the Company’s relationships with and reliance upon vendors with respect to the operation of certain of the Company key internal and external systems and applications; changes in consumer spending, borrowing and savings preferences or
habits; technological changes and the
expanding use of technology in banking (including the adoption of mobile banking applications); the ability to retain and increase market share, retain and grow customers and control expenses; changes in the competitive environment among financial and bank holding companies, banks and other financial service providers; continued volatility in the credit and equity markets and its effect on the general economy or local or regional business conditions; fluctuations in the price of the Company’s stock; the
effect of changes in accounting policies
and practices, as may be adopted from
time-to-time by the regulatory agencies, as well as by 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, and our ability to retain or expand our management team and/or our board of directors; the costs and effects of legal, compliance and regulatory changes and developments, including the resolution of legal proceedings or regulatory or other
governmental inquiries or investigations
and the results of regulatory examinations or reviews; our success at managing the risks involved in the foregoing items and all other factors set forth in the Company's public reports including its Annual Report on Form 10-K for the year ended December 31, 2014, 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. |
  2Q Results 2015 | cbbank.com
Total Assets:
$7.7 Billion
Gross Loans:
$3.8 Billion
Total Deposits (Including Repos):
$6.7 Billion
Total Equity:
$894 Million
Source: Q2 2015 earnings release & company filings.
CVB Financial Corp. (CVBF)
Largest financial institution headquartered in the Inland Empire
region of Southern California. Founded in
1974 Locations in 43 cities with 40 business financial
centers and 7 commercial banking centers and 3 trust
office locations serving the Inland Empire, LA County, Orange County, San Diego County, Ventura County and the Central Valley of California
3 |
 2Q Results 2015 | cbbank.com
Experienced Leadership
Name Position Banking Experience CVBF Service Christopher D. Myers President & CEO 31 Years 9 Years Richard C. Thomas Executive Vice President Chief Financial Officer 5 Years 4 Years James F. Dowd Executive Vice President Chief Credit Officer 38 Years 7 Years David C. Harvey Executive Vice President Chief Operations Officer 25 Years 5 Years David A. Brager Executive Vice President Sales Division 27 Years 12 Years R. Daniel Banis Executive Vice President CitizensTrust 33 Years 3 Years Yamynn DeAngelis Executive Vice President Chief Risk Officer 36 Years 28 Years Richard Wohl Executive Vice President General Counsel 27 Years 4 Years 4 |
 2Q Results 2015 | cbbank.com
Board of Directors
Name CVB Experience Age Ray O’Brien - Chairman 3 Years 58 George Borba Jr. - Vice Chairman 2 Years 47 Steve Del Guercio 2 Years 53 Robert Jacoby 10 Years 73 Hal Oswalt 1 Year 67 San Vaccaro 16 Years 82 Chris Myers - CEO 9 Years 53 5 |
 2Q Results 2015 | cbbank.com Who is CVB Financial Corp.? |
 2Q Results 2015 | cbbank.com
Largest Banks Headquartered in California
7 Source: SNL Financial In millions Rank Name Asset Size (3/31/15) 1 Wells Fargo $1,737,737 2 Union Bank $113,698 3 Bank of the West $70,938 4 First Republic Bank $51,066 5 SVB Financial $39,696 6 City National Bank $32,699 7 East West Bank $29,907 8 OneWest Bank $21,307 9 Pacific Western Bank $16,644 10 Cathay Bank $11,910 11 CVB Financial Corp. $7,443 12 BBCN $7,268 13 Banc of California, Inc. $6,097 14 Opus Bank $5,562 15 Farmers & Merchants of Long Beach $5,560 16 Westamerica Bank $5,036 |
 2Q Results 2015 | cbbank.com
Bank Accomplishments & Ratings
153 Consecutive Quarters of Profitability
103 Consecutive Quarters of Cash Dividends
#4 Rated Bank: BankDirector
Magazine
Bank Performance Scorecard (August 2014)
BauerFinancial
Report
Five Star Rating (September 2014)
78 Consecutive Quarters
Fitch Rating
BBB (September 2014) |
 2Q Results 2015 | cbbank.com Our Markets |
 Existing Locations 10 40 Business Financial Centers 7 Commercial Banking Centers 3 CitizensTrust Locations Corporate Office Business Financial Centers Commercial Banking Centers CitizensTrust San Diego – NEW Opened June 2014 Ventura – NEW Opened January 2015 |
 2Q Results 2015 | cbbank.com What’s New? |
 2Q Results 2015 | cbbank.com
Ventura County
12 Opened January 2015 | 6 Associates |
 2Q Results 2015 | cbbank.com
Deposits*
(000’s)
# of Center
Locations
Total Deposits
(6/30/14)
Total Deposits
(6/30/15)
Los Angeles County
18 $2,069,542 $2,418,945 Inland Empire (Riverside & San Bernardino Counties) 9 $2,148,802 $2,093,090 Central Valley 9 $845,125 $909,113 Orange County 9 $920,300 $925,129 Other 2 $257,036 $309,929 Total 47 $6,240,805 $6,656,206 *Includes Customer Repurchase Agreements Average Cost of Deposits (Year-to-Date) 0.11% 0.10% |
 2Q Results 2015 | cbbank.com
Total Deposits*
$500,000
$1,500,000
$2,500,000
$3,500,000
$4,500,000
$5,500,000
$6,500,000
$7,500,000
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2010 2011 2012 2013 2014 2015 Non-Int Bearing Dep Interest Bearing Deposits* 14 (000’s) *Interest Bearing Deposits includes REPOs |
 2Q Results 2015 | cbbank.com
Deposit Cost Comparison
15 Source: Q2 2015 earnings release & other company filings, SNL Financial—peers represent public
CA , AZ, HI, NV, OR & WA banks with assets $2 - $25 billion. Peer Data is as of 03/31/2015 0.00% 0.10% 0.20% 0.30% 0.40% 0.50% 0.60% 0.70% 0.80% 0.90% 1.00% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2010 2011 2012 2013 2014 2015 CVBF Peers |
             2Q Results 2015 | cbbank.com
(000’s)
# of Center
Locations
Average
Loans per
Location
Total Loans*
(6/30/2015)
Los Angeles County
18 $86,291 $1,553,237 Central Valley 9 $84,097 $756,874 Inland Empire (Riverside & San Bernardino Counties) 9 $72,926 $656,331 Orange County 9 $58,918 $530,259 Other 2 $150,863 $301,726 Total 47 $80,515 $3,798,427 *Prior to MTM discount, loan fees, loan loss reserve and loans Held for Sale
Starting
in the 4 th quarter of 2014, covered and non-covered loans are combined Total Loans* |
 2Q Results 2015 | cbbank.com
$2,000,000
$2,200,000
$2,400,000
$2,600,000
$2,800,000
$3,000,000
$3,200,000
$3,400,000
$3,600,000
$3,800,000
$4,000,000
$4,200,000
$4,400,000
Q1 Q2Q3 Q4 Q1 Q2Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2010 2011 2012 2013 2014 2015 Total Loans* Total Loans* (000’s) *Starting in the 4 th quarter of 2014, covered and non-covered loans are combined (Purchase Credit Impaired or PCI) Before deferred loan fees, discount on PCI loans, and loans held for sale
Includes covered and non-covered loans for all periods
presented |
 2Q Results 2015 | cbbank.com
Municipal Lease
Finance
Receivables, 2.0%
Dairy, Livestock &
Agribusiness, 4.9%
Commercial &
Industrial, 11.1%
Construction RE,
1.2%
Commercial RE -
Owner Occupied,
25.0%
Commercial RE-
Non-Owner,
42.1%
Multi-Family, 6.0%
SFR Mortgage,
5.7%
Other, 2.0%
18 Source: Q2 2015 earnings release & company reports Starting in the 4 th quarter of 2014, covered and non-covered loans are combined Loan Portfolio Composition Total Loans by Type |
 2Q Results 2015 | cbbank.com Credit Quality |
 2Q Results 2015 | cbbank.com
Non-Performing Assets*
$-
$20,000
$40,000
$60,000
$80,000
$100,000
$120,000
$140,000
$160,000
$180,000
$200,000
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 2009 2010 2011 2012 2013 2014 2015 Non-Performing Loans OREO 20 (000’s) *Non-Covered assets | Starting in the 4 th quarter of 2014, covered and non-covered assets are combined |
 2Q Results 2015 | cbbank.com
Classified Loans*
$-
$100,000
$200,000
$300,000
$400,000
$500,000
$600,000
$700,000
$800,000
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 2009 2010 2011 2012 2013 2014 2015 21 (000’s) *Non-Covered loans| Starting in the 4 th quarter of 2014, covered and non-covered loans are combined |
 2Q Results 2015 | cbbank.com
Loans: Net Charge-Offs*
22 *Non-Covered | Starting in the 4 th quarter of 2014, covered and non-covered loans are combined |
 2Q Results 2015 | cbbank.com Profits |
 2Q Results 2015 | cbbank.com
$-
$2,500
$5,000
$7,500
$10,000
$12,500
$15,000
$17,500
$20,000
$22,500
$25,000
$27,500
$30,000
$32,500
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 2009 2010 2011 2012 2013 2014 2015 Net Income (000’s) Net Income After Taxes $20.4 million FHLB prepayment charge $13.9 million FHLB prepayment charge |
 2Q Results 2015 | cbbank.com
Earnings
(000’s)
2011 2012 2013 2014 6 Months to 06/30/2015 Net Interest Income $234,681 $236,950 $216,266 $236,514 $123,767 Provision for Loan Losses ($7,068) $0 $16,750 $16,100 ($2,000) Other Operating Income/Expenses (Net) ($106,809) ($122,257) ($88,741) ($89,817) ($59,649) Income Taxes ($39,071) ($37,413) ($48,667) ($58,776) ($23,472) Net Profit After Tax $81,733 $77,280 $95,608 $104,021 $42,646 25 $20.4 million FHLB prepayment charge $13.9 million FHLB prepayment charge |
 2Q Results 2015 | cbbank.com
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 Q2Q3Q4Q1 Q2Q3Q4Q1 Q2Q3Q4Q1 Q2Q3Q4 Q1Q2Q3Q4 Q1Q2Q3Q4 Q1Q2Q3Q4 Q1Q2Q3 Q4Q1Q2 2007 2008 2009 2010 2011 2012 2013 2014 2015 26 *Normalized tax-equivalent excludes accretion on covered loans (Purchase Credit Impaired)
Normalized*
2.92%
3.92%
3.65% |
 2Q Results 2015 | cbbank.com Efficiency & Expenses |
 2Q Results 2015 | cbbank.com
Efficiency Ratio
0.00%
10.00%
20.00%
30.00%
40.00%
50.00%
60.00%
70.00%
80.00%
90.00%
Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2011 2012 2013 2014 2015 Efficiency Ratio 28 $20.4 million FHLB prepayment charge $13.9 million FHLB prepayment charge |
 2Q Results 2015 | cbbank.com
Non-Interest Expense
as a % of Average Assets
0.00%
0.50%
1.00%
1.50%
2.00%
2.50%
3.00%
3.50%
Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2011 2012 2013 2014 2015 Non-Interest Expense as a % of Average Assets 29 1.69% $20.4 million FHLB prepayment charge $13.9 million FHLB prepayment charge |
 2Q Results 2015 | cbbank.com Capital |
 Capital Ratios 31 * CVB Financial Corp. - Consolidated Regulatory Minimum Ratio Regulatory Well-Capitalized Ratio March 31, 2015* Tier 1 Risk-based Capital Ratio 6.0% 8.0% 17.35% Total Risk-based Capital Ratio 8.0% 10.0% 18.60% Tier 1 Leverage Ratio 4.0% 5.0% 10.94% Common Equity Tier 1 Capital Ratio 4.5% 6.5% 16.81% Tangible Capital Ratio 11.13% |
 2Q Results 2015 | cbbank.com Securities & Investments |
 2Q Results 2015 | cbbank.com
Municipal
Bonds 16.85%
Government
Agency &
GSEs 11.14%
MBS 58.86%
CMO's /
REMIC's
12.99%
Trust Preferred
0.16%
Source: Q2 2015 earnings release. As of 6/30/2015 securities
held-to-maturity were valued at approximately
$1.4 million | Yield on securities represents the fully taxable equivalent *Securities Available For Sale Securities portfolio totaled $3.2 billion at 6/30/2015. The portfolio represents 41.0% 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. Approximately 97% of the Bank’s municipal portfolio contains securities which have an underlying rating of investment grade.
California municipals represent only 4.6% of the municipal bond
portfolio Securities portfolio totaled $3.2 billion at
6/30/2015. The portfolio represents 41.0% 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. Approximately 97% of the Bank’s municipal portfolio contains securities which have an underlying rating of investment grade.
California municipals represent only 4.6% of the municipal bond
portfolio Yield on securities
portfolio =2.56%
for the 2nd Quarter 2015
Securities Portfolio*
--$3.2 Billion-- |
 2Q Results 2015 | cbbank.com
-$40,000
-$20,000
$0 $20,000 $40,000 $60,000 $80,000 $100,000 Jun 09 Dec 09 Jun 10 Dec 10 Jun 11 Dec 11 Jun 12 Dec 12 Jun 13 Dec 13 Jun 14 Dec 14 Jun 15 Securities Portfolio* $3.2 Billion Mark-to-Market (Pre-tax)
(000’s)
*Securities Available For Sale
$40,878 |
 2Q Results 2015 | 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
Securities
41.0%
Fed
Balance*
4.5%
Other 5.1%
Goodwill &
Intangibles
1.0%
Loans,
net 48.4%
6/30/15
$7.7 Billion
Securities
42.4%
Fed
Balance*
2.4%
Other 4.6%
Goodwill &
Intangibles
0.7%
Loans,
net
49.9%
12/31/06
$6.1 Billion |
 2Q Results 2015 | cbbank.com
Yield on Securities vs. Yield on Loans
0.00%
1.00%
2.00%
3.00%
4.00%
5.00%
6.00%
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 2009 2010 2011 2012 2013 2014 2015 Yield on Loans* Yield on Securities *Excluding Discount Accretion |
 2Q Results 2015 | cbbank.com
Total
Deposits*
61.4%
Other
Liabilities
0.7%
Borrowings
36.0%
Junior
subordinated
Debentures 1.9%
CVBF Liabilities
12/31/06
$5.7 Billion
6/30/15
$6.8 Billion
Total
Deposits*
97.84%
Other
Liabilities
1.78%
Borrowings
0.0% Junior subordinated Debentures 0.38% *Includes Customer Repurchase Agreements |
 2Q Results 2015 | cbbank.com Our Growth Strategy |
 2Q Results 2015 | cbbank.com
Our Vision
Citizens Business Bank will strive to become the
premier
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 |
 2Q Results 2015 | 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 2015 | cbbank.com
Three Areas of Growth
41 Same Store Sales DeNovo Acquisitions --Banks-- --Trust-- |
 2Q Results 2015 | 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 2015 | cbbank.com
Our ‘Critical Few’
• Execute on DeNovo Growth Initiatives • Pursue Strategic Acquisitions • Quality Loan Growth • Provide Customer Solutions Through Technology • Expand Market Share Through Same Store Sales |
 2Q Results 2015 | cbbank.com Copy of presentation at www.cbbank.com |