Investor Presentation December 2010 |
This presentation contains forward-looking statements, as defined by Federal Securities Laws, relating to present or future trends or factors affecting the operations, markets and products of CenterState Banks, Inc. (CSFL). These statements are provided to assist in the understanding of future financial performance. Any such statements are based on current expectations and involve a number of risks and uncertainties. For a discussion of factors that may cause such forward-looking statements to differ materially from actual results, please refer to CSFL’s most recent Form 10-Q and Form 10-K filed with the Securities Exchange Commission. CSFL undertakes no obligation to release revisions to these forward-looking statements or reflect events or circumstances after the date of this presentation. Forward Looking Statement 2 |
Birmingham Atlanta Winston-Salem Tampa Winter Haven Corporate Overview Headquartered in Davenport, FL $2.1 billion in assets $1.7 billion in deposits Company formed: June 2000 2 Subsidiary Banks; 54 locations 6 of 14 counties of operation rank in the top 15 fastest growing counties in Florida 3 Correspondent banking market |
4 Merger and Corporate Structure Merger of three national bank subsidiaries completed 12/10/10 Lead bank approximates $1.9 billion of combined total assets and approximately 8% Tier 1 leverage capital ratio Remaining Corporate subsidiaries: Valrico State Bank and R4ALL, Inc. R4ALL subsidiary presently warehousing approximately $29 million classified assets. Carried at 80% of appraised values Approximately 22% of classified loans are current Benefits of new structure includes use of capital, cost efficiency, and development of specialists. Newly consolidated special asset group comprised of 25 professionals focused on disposition of Legacy Bank assets, and FDIC covered assets. |
Source: Raymond James Carson Medlin Florida Credit Environment Florida economy 11.7% unemployment Florida Real Estate Market 25% of mortgages in Florida are delinquent or in some stage of foreclosure Florida real estate values continue to decrease. Median price decreased 6% y/y in September. Florida’s total NPAs increased in 3Q10; 5 of the 7 Florida regions had increased NPAs. Liquidation Approaches Orderly liquidation Note sales in wholesale debt market Repossessed real estate auctions Negotiated bulk sale 5 |
Florida Economic Environment 6 Florida’s April 1 Population United States and Florida Unemployment Rates (seasonally adjusted) Median Sales Price of Existing Homes Source: The Florida Legislature Office of Economic and Demographic Research Economy Slowly Recovering Florida growth rates are beginning an expected slow return to more typical levels. But, drags are more persistent than past events, and it will take years to climb out of the hole left by the recession. Overall… The subsequent turnaround in Florida housing will be led by: Low home prices that begin to attract buyers and clear the inventory Long-run sustainable demand caused by continued population growth and household formation. Florida’s unique demographics and the aging of the baby-boom generation. |
Credit Trends 7 |
Loan Portfolio Composition As of September 30, 2010 Excluding Covered Loans $920 Million 8 *After credit mark - 80% FDIC loss share first dollar loss. Covered Loans* $210 Million |
Non-Performing Loans Other Real Estate Owned $56,399,000 (6.13% of total loans, excluding covered loans) 30% of NPLs are current 76% of legal unpaid loan balance, net of specific reserves $11,861,000 58% of legal unpaid loan balance at repossession date Residential Real Estate $16,729K (102 loans) Commercial Real Estate $26,259K (52 loans) Construction, A&D, & Land $12,421K (52 loans) Commercial $440K (17 loans) Consumer / Other $550K (24 loans) Commercial Real Estate (18) $5,737K Mobile Homes w/ Land (6) $151K Vacant Land ( various acreages) $1,796K Single Family Homes (29) $3,037K Residential Lots (48) $1,140K Data as of 9/30/10 Non Performing Loans and OREO (excluding covered loans and OREO) 9 |
FDIC Investments – Consolidation Story July 16, 2010 – Olde Cypress Community Bank, Clewiston, Florida August 20, 2010 – Independent National Bank, Ocala, Florida August 20, 2010 – Community National Bank, Bartow, Florida 1Q 2011 – TD transaction, Palatka, Florida 10 Capital required to support acquired assets at 8% $12.5 M $12.4 M $5.2 M $9.0M $39.1 M July 27, 2010 Capital Raise, net $32.8 M Total January 30, 2009 – Ocala National Bank, Ocala, Florida |
11 Ocala National Bank Conversion completed 2009, core deposits growing; efficiencies obtained. Independent National Bank, Ocala Conversion scheduled for 5/2011; core deposit base stable; efficiencies expected to be realized in 2Q11. Olde Cypress Community Bank, Clewiston Conversion scheduled for 7/2011; core deposit base stable; efficiencies expected to be realized 3Q11 Community National Bank, Bartow Conversion scheduled for 9/2011; core deposit base stable; efficiencies expected to be realized 4Q11 The efficiencies gained from the last three FDIC acquisitions should be approximately $3million annually compared to present run rate but will not be fully realized until 4Q11 FDIC Investment Performance |
TD Bank transaction Expected to close in 1Q 2011 4 Branches in Putnam County, Florida $113 Million deposits Purchase $125 Million of hand-picked performing loans Purchase price of performing loans equal to 90% of legal unpaid balance Loans have a two-year put back period for any loan that becomes 30 days past due or becomes classified pursuant to applicable regulatory guidelines. IRR anticipated to exceed 20% Capital required to support acquired assets at 8%: $9 million 12 |
Current Events $75 million of AFS securities sold during 4Q10; pre-tax gain of $3.4 million. Modest profit anticipated 4Q10; PTPP income continues to be healthy Correspondent Banking Division – expected 4Q earnings in line with 1Q and 2Q Modest increase in NPAs expected in 4Q10. OREO auction held in 4Q10; approximately $2.4 million sold; recognized loss on sale of approximately $500K. The Bank continues to evaluate a number of FDIC transactions and anticipates to be an active bidder in 2011. A larger transaction may require a contingent capital raise. Three largest subsidiary banks combined into one bank during December creating cost efficiencies and better utilization of capital. In uncertain times, management’s approach is to maintain a Tier 1 leverage ratio approximating 10% at the company level. As the economy and real estate markets improve, and we enter into a more normal environment, we would expect to reduce this ratio to approximately 8%. 13 |