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| 8-K - 8-K - PARK NATIONAL CORP /OH/ | prk201611158-kb.htm |
November 16-17, 2016
Sandler O’Neill
East Coast Financial Services Conference
1
Safe Harbor Statement
Park cautions that any forward-looking statements contained in this presentation or made by management of Park are provided to assist in
the understanding of anticipated future financial performance. Forward-looking statements provide current expectations or forecasts of future
events and are not guarantees of future performance. The forward-looking statements are based on management’s expectations and are
subject to a number of risks and uncertainties. Although management believes that the expectations reflected in such forward-looking
statements are reasonable, actual results may differ materially from those expressed or implied in such statements. Risks and uncertainties
that could cause actual results to differ materially include, without limitation: Park's ability to execute its business plan successfully and within
the expected timeframe; general economic and financial market conditions, and the uneven spread of positive impacts of the recovery on the
economy, specifically in the real estate markets and the credit markets, either nationally or in the states in which Park and its subsidiaries do
business, may be worse or slower than expected which could adversely impact the demand for loan, deposit and other financial services as
well as loan delinquencies and defaults; changes in interest rates and prices may adversely impact the value of securities, loans, deposits
and other financial instruments and the interest rate sensitivity of our consolidated balance sheet; changes in consumer spending, borrowing
and saving habits; changes in unemployment; asset/liability repricing risks and liquidity risks; our liquidity requirements could be adversely
affected by changes to regulations governing bank capital and liquidity standards as well as by changes in our assets and liabilities;
competitive factors among financial services organizations could increase significantly, including product and pricing pressures and our
ability to attract, develop and retain qualified bank professionals; the nature, timing and effect of changes in banking regulations or other
regulatory or legislative requirements affecting the respective businesses of Park and its subsidiaries, including changes in laws and
regulations concerning taxes, accounting, banking, securities and other aspects of the financial services industry, specifically the Dodd-
Frank Wall Street Reform and Consumer Protection Act of 2010 (the “Dodd-Frank Act”), as well as future regulations which will be adopted
by the relevant regulatory agencies, including the Consumer Financial Protection Bureau, to implement the Dodd-Frank Act's provisions, the
Budget Control Act of 2011, the American Taxpayer Relief Act of 2012 and the Basel III regulatory capital reforms; the effect of changes in
accounting policies and practices, as may be adopted by the Financial Accounting Standards Board, the SEC, the Public Company
Accounting Oversight Board and other regulatory agencies, and the accuracy of our assumptions and estimates used to prepare our
financial statements; the effect of fiscal and governmental policies of the United States federal government; the adequacy of our risk
management program; a failure in or breach of our operational or security systems or infrastructure, or those of our third-party vendors and
other service providers, including as a result of cyber attacks; demand for loans in the respective market areas served by Park and its
subsidiaries; and other risk factors relating to the banking industry as detailed from time to time in Park's reports filed with the Securities and
Exchange Commission including those described in "Item 1A. Risk Factors" of Part I of Park's Annual Report on Form 10-K for the fiscal
year ended December 31, 2015. Park does not undertake, and specifically disclaims any obligation, to publicly release the results of any
revisions that may be made to update any forward-looking statement to reflect the events or circumstances after the date on which the
forward-looking statement was made, or reflect the occurrence of unanticipated events, except to the extent required by law.
2
Park National Corporation (PRK) Profile
(as of September 30, 2016)
• 11 Community Bank Divisions
• 2 Specialty Finance Companies
• One non-bank workout subsidiary
• 29 Ohio counties
• 110 bank branches
• 6 specialty finance offices
• 1,732 FTEs
3
Park Executive Management
David L. Trautman – President and CEO– Age: 55
President , CEO and Board Member of The Park National Bank and Park National Corporation (Park)
headquartered in Newark, Ohio. He served as President of First-Knox National Bank, a division of The Park
National Bank, from May 1997 through January 2002, and as its Chairman from 2001 to 2006. In addition, he
served on the Board of the United Bank of Bucyrus, a division of The Park National bank, from 2000 to 2006.
Mr. Trautman received his BA from Duke University and joined Park immediately following graduation. He holds
an MBA, with honors, from The Ohio State University. He is a graduate of The Stonier Graduate School of
Banking at The University of Delaware and the Ohio Bankers Association Leadership Institute.
Mr. Trautman is past Chairman of the Ohio Bankers League, member of Newark Rotary Club, past campaign
chair for United Way of Licking County, and serves as a Trustee of the Licking County Foundation and Dawes
Arboretum.
C. Daniel DeLawder – Chairman – Age: 67
Chairman and Board Member of The Park National Bank and Park National Corporation headquartered in
Newark, Ohio. He served previously as CEO of The Park National Bank and Park for 15 years. He served as
President of the Fairfield National Bank, a division of The Park National Bank, from 1985 through 1991. He also
currently serves on the Boards of MedBen, Truck One, Inc. and Fleet Service, Inc.
Mr. DeLawder received his B.S.Ed., cum laude from Ohio University in Athens and joined Park immediately
following graduation. He is a graduate of numerous bank industry educational programs.
Mr. DeLawder is a past member of the Board of Directors of the Federal Reserve Bank of Cleveland. He is the
past chairman of the Board of Trustees of Ohio University. He served as a member of the American Bankers
Association (ABA) BankPac Committee as well as a member of the Government Relations Council of the ABA.
He is past Chairman of the Ohio Bankers Association and a past Director-at-Large of the Community Bankers
Association of Ohio.
Leadership Team
4
Park Executive Management
(continued)
Brady T. Burt – Chief Financial Officer – Age: 44
Chief Financial Officer of Park since 2012. Formerly served as the Chief Accounting Officer with Park from
April 2007 to December 2012.
Prior to joining Park, Mr. Burt served Vail Banks, Inc. in various capacities, including EVP-Chief Financial
Officer from June 2005 to November 2006, SVP-Director of Internal Audit from September 2003 to June
2005, and VP-Assistant Audit Director from April 2002 to September 2003. Mr. Burt was also employed by
PricewaterhouseCoopers from September 1994 to August 2001, working in various accounting roles, both in
Ohio and London, England.
Mr. Burt received his B.S. Degree in Accounting from Miami University in 1994. In addition, he currently is a
board member and serves on the Finance Committee of the Licking County United Way, is a board member
and board secretary of Habitat MidOhio, is a member of the Granville Rotary Club, and is an Audit
Committee member of the Licking County Foundation.
Matthew R. Miller – Chief Accounting Officer – Age: 38
Chief Accounting Officer of Park since 2012. He served previously as an Accounting Vice President with
Park beginning in April 2009.
Prior to joining Park, Mr. Miller worked eight years at Deloitte & Touche, where his experience was primarily
focused on financial service industry clients.
Mr. Miller holds a bachelor’s degree in accounting, graduating summa cum laude from the University of
Akron. In addition, he currently is a board member of the Next Generation Advisory Board of the Ohio
Bankers League, is a board member of the YMCA of Licking County, is the 2015-16 campaign chair for the
United Way of Licking County, is chair of the Development Council Cultivation Committee at The Works and
is a member of the Granville Rotary Club.
5
Experienced Leadership Team
Name Position Age
Years
with
PRK
Years
In
Industry
David L. Trautman President & CEO 55 33 33
C. Daniel DeLawder Chairman 67 45 45
Brady T. Burt Chief Financial Officer 44 9 15
Senior leadership consists of executives with proven local market experience
Leadership team averages 27 years of banking experience
Average management tenure with Park National is approximately 22 years
6
Leadership Team – continued
Name Position Age
Years
with
PRK
Years
In
Industry
Adrienne M. Brokaw SVP – Director of Internal Audit 48 3 17
Thomas J. Button SVP – Chief Credit Officer 56 19 30
Thomas M. Cummiskey SVP – Trust 47 17 19
Robert N. Kent, Jr. President – Scope Aircraft Finance 59 13 33
Timothy J. Lehman SVP and Chief Operating Officer 52 21 21
Laura B. Lewis SVP – Human Resources & Marketing 57 32 32
Matthew R. Miller SVP – Chief Accounting Officer 38 7 13
Jason L. Painley SVP – Chief Risk Officer 39 5 16
Greg M. Rhoads VP – Chief Information Officer 38 14 14
Cheryl L. Snyder SVP – Consumer Banking 60 37 39
Paul E. Turner SVP - Treasury 49 26 26
Jeffrey A. Wilson SVP – Chief Administrative Officer 50 12 20
7
Affiliate Leadership
Name Position Age
Years
with
PRK/Affiliate
Years
In
Industry
Brett A. Baumeister President – Unity National Bank 50 12 26
John A. Brown President – Security National Bank 47 25 25
David J. Gooch
President – Park National Bank of
Southwest Ohio & Northern Kentucky
47 19 25
Chris R. Hiner President – Richland Bank 33 10 10
Brian R. Hinkle President – Farmers & Savings Bank 39 11 15
Thomas M. Lyall Chairman – Century National Bank 70 45 45
Matthew R. Marsh President – Guardian Finance Company 51 17 28
Patrick L. Nash President – Century National Bank 52 29 29
Vickie A. Sant President – First-Knox National Bank 61 40 40
Donald R. Stone President – United Bank 59 20 32
John E. Swallow President – Second National Bank 60 31 41
Stephen G. Wells President – Fairfield National Bank 55 32 32
8
Highlights of the First Nine Months of 2016
• Loan growth of $60.5 million in 3Q 2016 (4.7% annualized) and
$119.4 million year-to-date (3.2% annualized) at Park’s Ohio
subsidiary, The Park National Bank.
• Credit quality remains strong: Park National Corporation experienced
annualized net recoveries for the first nine months of 2 basis points,
and annualized net charge-offs of 6 basis points for Park’s Ohio
subsidiary, The Park National Bank.
• Continued reduction of SEPH (formerly Vision) nonperforming
assets. At September 30, 2016, the carrying value of SEPH’s
nonperforming assets were approximately $31.9 million, including $9.6
million of participations at Park National Bank, down from $36.2 million
and $9.8 million, respectively, at December 31, 2015.
9
PRK and PRK, excluding Vision & Southeast Property Holdings, LLC (SEPH)
ROA and ROE History
1 Calculated using average common equity for Park National Corporation.
2 Calculated using average common equity for Park National Corporation, excluding Vision Bank and SE Property Holdings, LLC.
3 Adjusted for goodwill impairment charges of $55 million in 2008 and $54 million in 2007. Including the goodwill impairment charges, Park’s ROAA for 2008 and 2007 was 0.20% and
0.37%,respectively, and Park’s ROAE for 2008 and 2007 was 2.40% and 3.67% respectively.
4 Due to unavailability of 3Q 2016 peer median financial metrics, data utilized herein reflects 2Q 2016 peer results.
Source: BHC Performance Report and Company Filings
Peers include all bank holding companies nationwide with total assets between $3.0 and $10.0 billion
Park
ROAA
Park ROAA,
excluding VB
& SEPH
Peer
median
ROAA Park ROAE 1
Park ROAE,
excluding VB &
SEPH 2
Peer
median
ROAE
3Q 2016 YTD
(annualized) 1.19% 1.16% 0.97%4 12.04% 11.93% 8.75% 4
2015 1.11% 1.12% 0.97% 11.40% 11.69% 8.68%
2014 1.22% 1.16% 0.95% 12.34% 11.81% 8.34%
2013 1.15% 1.16% 1.04% 11.94% 12.11% 8.89%
2012 1.11% 1.33% 0.98% 11.41% 13.94% 8.56%
2011 1.06% 1.59% 0.80% 11.81% 19.46% 7.27%
2010 0.74% 1.58% 0.25% 8.05% 18.27% 0.88%
2009 0.97% 1.61% (0.16)% 11.81% 20.80% (2.22)%
2008 1.02% 3 1.63% (0.06)% 12.12% 3 21.57% (2.01)%
2007 1.24% 3 1.52% 0.87% 12.40% 3 17.88% 9.45%
2006 1.75% 1.75% 1.11% 17.26% 17.26% 12.23%
Average
2006 – 2015 1.14% 1.45% 0.68% 12.05% 16.48% 6.01%
10
Total Return Performance
Park National Corporation
The total return performance graph depicts the yearly change in Park’s cumulative total shareholder return over the five-year period from December 31,
2010 to December 31, 2015. Calculations include the reinvestment of dividends and are indexed to the base year’s measurement point (closing price on last
trading day before the beginning of Parks’ fifth preceding fiscal year).
Source: SNL 11
70
85
100
115
130
145
160
175
12/31/10 12/31/11 12/31/12 12/31/13 12/31/14 12/31/15
In
d
e
x
V
a
lu
e
Total Return Performance
Park National Corporation
NYSE MKT Composite
NASDAQ Bank Stocks
SNL Financial Bank and Thrift
The Park National Bank – The bank of choice
Source: SNL, June 30, 2016
Headquarter Counties – Deposits (in thousands)
12
Bank Division
Year Joined
Park
Hdqtr. Co.
Deposits
Total County
Deposits
% of 2016
Market Share
% of 2015
Market Share
2016
Headquarter
County
Market Share
Rank
2015
Headquarter
County
Market Share
Rank
Park National 1908 $1,554,977 $2,506,245 62.04% 62.98% 1 1
Fairfield National 1985 374,719 2,005,731 18.68% 20.58% 1 1
Richland Bank 1987 529,316 1,814,562 29.17% 28.94% 1 1
Century National 1990 462,466 1,363,558 33.92% 33.51% 1 1
First-Knox National 1997 527,959 856,851 61.62% 60.70% 1 1
Second National 2000 276,029 1,116,268 24.73% 24.11% 2 2
Security National 2001 478,881 1,478,541 32.39% 32.82% 1 1
Seven largest OH divisions $4,204,347 $11,141,756 37.74% 38.06%
Other OH divisions – headquarter counties 596,693 5,195,471 11.48% 11.30%
Total OH divisions – headquarter counties $4,801,040 $16,337,227 29.39% 29.66%
Remaining Ohio bank deposits $926,030
Total Ohio bank deposits $5,727,070
Park National Corporation – Income Statement
Source: Company Filings
(in thousands) Q3 2016 Q2 2016 Q1 2016
Nine
months
YTD 2016
Nine
months
YTD 2015 2015 2014
Net interest income $ 58,533 $ 57,485 $ 59,819 $ 175,837 $ 169,765 $ 227,632 $ 225,044
(Recovery of) provision for loan losses (7,366) 2,637 910 (3,819) 5,648 4,990 (7,333)
Other income 20,535 18,736 17,389 56,660 58,255 77,551 75,549
Other expense 46,756 45,306 49,899 141,961 137,816 186,614 187,510
Income before income taxes $ 39,678 $ 28,278 $ 26,399 $ 94,355 $ 84,556 $ 113,579 $ 120,416
Federal income taxes 12,229 8,280 7,713 28,222 24,433 32,567 36,459
Net income $ 27,449 $ 19,998 $ 18,686 $ 66,133 $ 60,123 $ 81,012 $ 83,957
13
PARK NATIONAL CORPORATION
Statement of Condition
Source: Company Filings
(in millions) Sept. 30, 2016 Dec. 31, 2015 Dec. 31, 2014
Investment securities $ 1,478 $ 1,644 $ 1,501
Loans 5,187 5,068 4,830
Allowance for loan losses (54) (56) (54)
Other assets 753 655 724
Total assets $ 7,364 $ 7,311 $ 7,001
Non-interest bearing deposits $ 1,429 $ 1,404 $ 1,269
Interest bearing deposits 4,091 3,944 3,859
Total deposits $ 5,520 $ 5,348 $ 5,128
Total borrowings 1,006 1,177 1,109
Other liabilities 87 73 67
Stockholders’ equity 751 713 697
Total liabilities & shareholders’ equity $ 7,364 $ 7,311 $ 7,001
14
Quarterly Net Income by Operating Segment
Source: Company Filings
(In thousands) Q3 2016 Q2 2016 Q1 2016
Nine months
YTD 2016
Nine months
YTD 2015 2015 2014
PNB $25,491 $21,078 $21,744 $68,313 $61,199 $84,345 $82,907
GFSC 640 626 (1,836) (570) 1,082 1,423 1,175
Park Parent Company 1 (665) (1,069) (1,834) (3,568) (1,654) (4,549) (5,050)
Ongoing operations $25,466 $20,635 $18,074 $64,175 $60,627 $81,219 $79,032
SEPH 1,983 (637) 612 1,958 (504) (207) 4,925
Total Park $27,449 $19,998 $18,686 $66,133 $60,123 $81,012 $83,957
1 The “Park Parent Company” above excludes the results for SEPH, an entity which is winding down commensurate with the disposition of its problem assets. Management
considers the “Ongoing operations” results to be reflective of the business of Park and its subsidiaries on a going forward basis.
15
Source: Company Filings
The Park National Bank
Income Statement
(In thousands) Q3 2016 Q2 2016 Q1 2016
Nine months
YTD 2016
Nine months
YTD 2015 2015 2014
Net interest income $ 57,033 $ 56,006 $ 57,155 $ 170,194 $ 164,559 $ 220,879 $ 218,641
(Recovery of) provision for
loan losses (3,345) 1,362 1,533 (450) 7,329 7,665 3,517
Other income 19,279 18,508 17,223 55,010 56,431 75,188 69,384
Other expense 42,327 42,731 41,360 126,418 124,662 167,476 163,641
Income before income taxes $ 37,330 $ 30,421 $ 31,485 $ 99,236 $ 88,999 $ 120,926 $ 120,867
Federal income taxes 11,839 9,343 9,741 30,923 27,800 36,581 37,960
Net income $ 25,491 $ 21,078 $ 21,744 $ 68,313 $ 61,199 $ 84,345 $ 82,907
16
Park National Bank
Statement of Condition
Source: Company Filings
(In thousands)
September 30,
2016
December 31,
2015
September 30,
2015
% change
from
12/31/15
% change
from
9/30/15
Loans $ 5,148,482 $ 5,029,072 $ 4,960,654 2.37% 3.79%
Allowance for loan losses 51,573 54,453 56,403 (5.29%) (8.56%)
Net loans 5,096,909 4,974,619 4,904,251 2.46% 3.93%
Investment securities 1,475,863 1,641,539 1,467,009 (10.09%) 0.60%
Total assets 7,287,923 7,229,764 7,216,773 0.80% 0.99%
Average assets (1) 7,339,517 7,219,898 7,206,175 1.66% 1.85%
Return on average assets (2) 1.24% 1.17% 1.14% 5.98% 8.77%
(1) Average assets for the nine-month periods ended September 30, 2016 and 2015, and for the year ended December 31, 2015.
(2) Annualized for the nine months ended September 30, 2016 and 2015.
17
Park National Bank
Loans by Type
Source: Company Filings as of September 30, 2016
• Commercial lending focus is on small, closely-held businesses within our markets.
• Consumer mortgage and home equity portfolios are originated by Park within our footprint and have been consistently underwritten for decades
9/30/2016 6/30/2016 12/31/2015 9/30/2015 % Change from
Amount Amount Amount Amount 6/30/2016 12/31/2015 9/30/2015
Commercial Real Estate
Owner Occupied $ 463,946 $ 470,555 $ 507,572 $ 503,186 (1.40%) (8.60%) (7.80%)
Non-Owner Occupied 545,480 530,444 479,584 460,115 2.83% 13.74% 18.55%
Residential Real Estate 1,818,335 1,828,506 1,843,525 1,854,118 (0.56%) (1.37%) (1.93%)
Construction Real Estate 184,275 171,124 171,301 158,302 7.69% 7.57% 16.41%
Commercial & Industrial 958,745 964,257 958,767 912,636 (0.57%) 0.00% 5.05%
Consumer 1,042,523 989,411 939,020 940,969 5.37% 11.02% 10.79%
Farmland 131,576 130,068 126,447 128,277 1.16% 4.06% 2.57%
Leases 3,602 3,649 2,856 3,051 (1.29%) 26.12% 18.06%
Total Loans $ 5,148,482 $ 5,088,014 $ 5,029,072 $ 4,960,654 1.19% 2.37% 3.79%
Annualized growth rate in 2016 of
3.17%
18
Park National Corporation
Nonperforming assets
1 The carrying balance of impaired loans as a percentage of unpaid principal balance at September 30, 2016 was 73.6% and 53.2% for Park National Corporation and SEPH,
respectively.
2 At September 30, 2016, Vision/SEPH participations included in Park National Corporation’s nonperforming assets were approximately $9.6 million.
Source: BHC Performance Report and Company Filings
(in thousands)
Sept. 30,
2016
Dec. 31,
2015
Dec. 31,
2014
Non-accrual loans 1 $ 97,832 $ 95,887 $ 100,393
Renegotiated loans 1 17,350 24,979 16,254
Loans past due 90 days or more (still accruing) 1,682 1,921 2,641
Total nonperforming loans $ 116,864 $ 122,787 $ 119,288
Other real estate owned (OREO) 14,941 18,651 22,605
Total nonperforming assets 2 $ 131,805 $ 141,438 $ 141,893
Percentage of nonaccrual loans and loans 90+ days
past due to loans (PRK) 1.92% 1.93% 2.13%
Percentage of nonaccrual, restructured and OREO to
assets (PRK) 1.77% 1.91% 1.99%
Texas Ratio (PRK) 18.00% 20.28% 20.85%
Peer Group Information Jun. 30, 2016 Dec. 31, 2015 Dec. 31, 2014
Percentage of nonaccrual loans and loans 90+ days
past due to loans (Peer Group) 0.68% 0.74% 1.13%
Percentage of nonaccrual, restructured and OREO to
assets (Peer Group) 0.83% 0.90% 1.23%
Note: The Texas Ratio is calculated as total nonperforming assets divided
by the sum of tangible common equity plus the allowance for loan losses.
19
Source: BHC Performance Report and Company Filings
(in thousands)
Sept. 30,
2016
Dec. 31,
2015
Dec. 31,
2014
Non-accrual loans $ 84,045 $ 81,468 $ 77,477
Renegotiated loans 17,350 24,979 16,157
Loans past due 90 days or more (still accruing) 1,682 1,921 2,641
Total nonperforming loans $ 103,077 $ 108,368 $ 96,275
Other real estate owned (OREO) – PNB 7,004 7,456 10,687
Total nonperforming assets $ 110,081 $ 115,824 $ 106,962
Percentage of nonaccrual loans and loans 90+
days past due to loans (PNB and Guardian) 1.66% 1.65% 1.67%
Percentage of nonaccrual, restructured and OREO to assets (PNB and
Guardian) 1.49% 1.57% 1.51%
Texas Ratio
15.40% 16.98% 16.09%
Peer Group Information Jun. 30, 2016 Dec. 31, 2015 Dec. 31, 2014
Percentage of nonaccrual loans and loans 90+
days past due to loans (PRK Peer Group) 0.68% 0.74% 1.13%
Percentage of nonaccrual, restructured and OREO to assets (PRK Peer
Group) 0.83% 0.90% 1.23%
Park National Corporation less Vision Bank/SEPH
Nonperforming Assets
Note: The Texas Ratio is calculated as total nonperforming assets divided
by the sum of tangible common equity plus the allowance for loan losses.
20
PNB & GFC Nonperforming Loans
Supplemental Information
21
7 Year Average NCOs as a % of Average Loans (as of 6/30/16)
Loan Category
PNB, including
Guardian
Peer Group
Average
Peer Group
Median
Commercial, financial & agricultural 0.52% 0.58% 0.47%
Commercial real estate 0.17% 0.42% 0.34%
Consumer 0.61% 0.74%* 0.61%
1 At September 30, 2016, approximately 75.0% of PRK’s Ohio-based nonaccrual loans were current.
2 Peer group consists of 19 of the 21 Midwest peer banks identified in PRK’s 2016 proxy for which historical data was available (Talmer
Bancorp and National Penn Bancshares have both been acquired).
* Excludes one peer bank which is engaged in a short term tax refund financing business which experiences high charge offs. PNB does
not engage in this type of lending.
$3,449
$1,855 $1,987
$(9,210)
$(3,372)
$(12,000)
$(10,000)
$(8,000)
$(6,000)
$(4,000)
$(2,000)
$-
$2,000
$4,000
$6,000
Accomodation/Food Services Agricultural Healthcare and Social
Assistance
Other Commercial Loans Consumer
Change in Nonperforming Loans from 12/31/15 - 9/30/16 (in thousands)
Park National Bank
Commercial Loan Portfolio Trends
1 Commercial loans include: (1) Commercial, financial and agricultural loans, (2) Commercial real estate loans, (3) Commercial related loans in the construction real estate portfolio and
(4) Commercial related loans in the residential real estate portfolio.
*Included within Park National Bank’s impaired loan totals, participations related to Vision Bank were $8.4 million, $5.1 million, and $5.0 million December 31, 2014, December 31, 2015, and
September 30, 2016, respectively.
Source: Company Filings
1
22
$2,360,689
$2,493,518
$2,548,431
51,323
66,232
64,313
$2,431,511
$2,588,241
$2,627,184
$2,000,000
$2,100,000
$2,200,000
$2,300,000
$2,400,000
$2,500,000
$2,600,000
$2,700,000
December 31, 2014 December 31, 2015 September 30, 2016
(D
ata
in
00
0
s)
Impaired*
Substandard
Special Mention
Pass rated
PRK comparison to peers
1 Calculated for the nine months ended September 30, 2016.
2 Annualized based on dividends and stock price through September 30, 2016.
3 Due to unavailability of 3Q 2016 peer median financial metrics, data utilized herein reflects 2Q 2016 peer results.
Source: Company Filings and SNL data of $3 to $10 billion bank holding companies
PRK
Price to
Book %
Peer
Group
Price to
Book %
PRK
Price to
tangible
book
Peer
Group
Price to
Tangible
Book %
PRK
Price to
Earnings
Peer
Group
Price to
Earnings
PRK
Dividend
Yield
Peer
Group
Dividend
Yield
3Q 2016 196% 126% 3 217% 154% 3 16.8 1 15.0 3 3.9 2 2.4 3
2015 194% 136% 216% 168% 17.2 16.2 4.2 2.1
2014 196% 146% 218% 178% 16.2 19.8 4.2 1.9
2013 202% 170% 227% 192% 17.0 19.9 4.4 2.1
2012 153% 117% 172% 145% 13.2 13.4 5.8 2.8
2011 156% 109% 176% 135% 13.1 14.7 5.8 2.4
2010 177% 127% 202% 155% 21.1 17.8 5.2 2.1
2009 141% 105% 163% 140% 12.2 16.9 6.4 2.5
2008 183% 135% 217% 211% 14.6 15.7 5.3 2.9
2007 155% 138% 207% 206% 11.9 13.2 5.8 3.3
2006 242% 206% 280% 291% 14.7 17.1 3.8 2.3
2005 259% 204% 296% 268% 15.5 15.5 3.6 2.3
23
A Successful History of Disciplined
Strategic Growth in Ohio (11 acquisitions;
2 De Novos)
1908
1908
The Park National
Bank is established
1985
1985
Acquisition of
Fairfield
National Bank
1987
1987
Park National
Corporation holding
company is
established
Acquisition of
Richland Trust
Company
1990
1990
Acquisition of
Century National
Bank
1994
1994
Acquisition of
Scope Aircraft
Finance
1997 1999 2000 2001 2005 2006
1997
Acquisition of First-Knox
National Bank
Farmers Savings Bank
1999
Guardian Finance
Company established
2000
Acquisition of United
Bank
Acquisition of Second
National Bank
2001
Acquisition of Security
National Bank
Citizens National Bank
Unity National Bank
2005
Acquisition of First
Federal Savings
Bank of Eastern Ohio
(merged with Century
National Bank)
Acquisition of First
Clermont Bank
(became the Park
National Bank of
Southwest Ohio &
Northern Kentucky
division)
2006
Acquisition of Anderson
Bank (merged with The Park
National Bank of Southwest
Ohio & Northern Kentucky
division)
24
PRK M&A Strategy
Two prong strategy guidelines:
• Traditional M&A
• Strong franchise, good reputation
• Good market share
• Existing leadership continuity
• Traditional community bank structure
• Core deposits
• Metro Strategy – Attractive markets in the
Midwest / Southeast / Mid-Atlantic states
• Open de novo
• Mirror successful Columbus, Ohio
office
• Partner with banks that have the
following characteristics:
• Consistent loan growth
• Acceptable asset quality
• Existing or potential trust and
wealth management business
• Commercial focused
• Proven leadership team
25
2016 PRK Agenda
26
A. Consolidated Net Income => $85 million
B. Maintain common dividend at historic rate
C. Perform in upper quintile of $3-$10 billion bank holding company peer group
D. Reduce NPA’s to peer levels
E. At least maintain => 85% of key risk indicators in green/yellow condition
F. Cultivate and respond promptly to M & A possibilities
November 16-17, 2016
Sandler O’Neill
East Coast Financial Services Conference
27