![]() July 2012 Exhibit 99.1 |
![]() 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 future operating results. These forward-looking statements are subject to risks and uncertainties that could cause actual results, performance or achievements to differ materially from those projected. These risks and uncertainties include, but are not limited to, local, regional, national and international economic conditions and events and the impact they may have on us and our customers; ability to attract deposits and other sources of liquidity; oversupply of inventory and continued deterioration in values of real estate in California and other states where our bank makes loans, both residential and commercial; a prolonged slowdown in construction activity; changes in the financial performance and/or condition of our borrowers; changes in the level of non-performing assets and charge-offs; the effect of changes in laws and regulations (including laws and regulations concerning taxes, banking, business and consumer credit, securities, executive compensation and insurance) with which we and our subsidiaries must comply; changes in estimates of future reserve requirements based upon the periodic review thereof under relevant regulatory and accounting requirements; inflation, interest rate, securities market and monetary fluctuations; the availability and effectiveness of hedging instruments and strategies; political instability; acts of war or terrorism, or natural disasters, such as earthquakes, or the effects of pandemic flu; the timely development and acceptance of new banking products and services and perceived overall value of these products and services by users; changes in consumer spending, borrowing and savings habits; technological changes; threats to the stability and security of our technology hardware and software, and to the stability and security of any related vendor or customer hardware and software; the ability to increase market share and control expenses; changes in the competitive environment among financial and bank holding companies and other financial service providers; continued volatility in the credit and equity markets and its effects on the general economy; the effect of changes in accounting policies and practices, as may be adopted by the regulatory agencies, as well as 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; the costs and effects of legal and regulatory developments including the resolution of legal proceedings or regulatory or other governmental inquiries and the results of regulatory examinations or reviews; our success at managing the risks involved in the foregoing items and other factors set forth in the Company's public reports including its Annual Report on Form 10-K for the year ended December 31, 2011, 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. Safe Harbor |
![]() 3 Total Assets: $6.5 Billion Gross Loans: $3.4 Billion Total Deposits (Including Repos): $5.2 Billion Total Equity: $748 Million Source: Q2 2012 earnings release & company filings. *non-covered loans Largest financial institution headquartered in the Inland Empire region of Southern California. Founded in 1974. Serves 40 cities with 42 business financial centers and 5 commercial banking centers throughout the Inland Empire, LA County, Orange County and the Central Valley of California Average Cost of Deposits = 0.13% Significant equity ownership board of directors: approximately 16% CVB Financial Corp. (CVBF) |
![]() 4 Name Name Position Position Banking Banking Experience Experience CVBF CVBF Service Service Christopher D. Myers President & CEO 28 Years 6 Years Richard C. Thomas Executive Vice President Chief Financial Officer 3 Years 2 Years James F. Dowd Executive Vice President Chief Credit Officer 35 Years 4 Years David C. Harvey Executive Vice President Chief Operations Officer 23 Years 3 Years David A. Brager Executive Vice President Sales Division 24 Years 9 Years R. Daniel Banis Executive Vice President CitizensTrust 30 Years New Yamynn DeAngelis Executive Vice President Chief Risk Officer 33 Years 25 Years Richard Wohl Executive Vice President General Counsel 24 Years New Experienced Leadership |
![]() Who is… |
![]() Rank Name Asset Size (3/31/12) 1 Wells Fargo $1,333,799 2 Union Bank $92,323 3 Bank of the West $62,343 4 First Republic Bank $29,719 5 OneWest Bank $25,010 6 City National Bank $24,038 7 East West Bank $21,750 8 SVB Financial $20,818 9 Cathay Bank $10,557 10 10 CVB Financial Corp CVB Financial Corp $6,506 $6,506 11 Pacific Capital Bank $5,846 12 Pacific Western Bank $5,448 13 Westamerica Bank $5,060 14 Farmers & Merchants of Long Beach $4,769 Largest Banks Headquartered in California In millions In millions |
![]() • • 141 Consecutive Quarters of Profitability 141 Consecutive Quarters of Profitability • • 91 Consecutive Quarters of Cash Dividends 91 Consecutive Quarters of Cash Dividends • • #11 Forbes Magazine Best Banks (December 2011) #11 Forbes Magazine Best Banks (December 2011) • • BauerFinancial Report BauerFinancial Report Five Star Rating (March 2012) Five Star Rating (March 2012) • • Fitch Rating Fitch Rating BBB (October 2011) BBB (October 2011) Bank Accomplishments & Ratings |
![]() Our Markets Our Markets |
![]() 9 42 Business Financial Centers 42 Business Financial Centers 5 Commercial Banking Centers 5 Commercial Banking Centers Existing Locations |
![]() (000’s) # of Center Locations Total Deposits (6/30/11) Total Deposits (6/30/12) Los Angeles County 17 $1,858,203 $1,926,234 Inland Empire (Riverside & San Bernardino Counties) 11 $1,631,031 $1,652,751 Central Valley 11 $751,190 $792,246 Orange County 8 $579,049 $560,978 Other 0 $220,218 $234,277 Total 47 $5,039,691 $5,166,486 *Includes Customer Repurchase Agreements Average Cost of Deposits 0.24% 0.16% Deposits* |
![]() (000’s) Non-Interest Bearing Deposits |
![]() 12 Source: Q2 2012 earnings release & other company filings, SNL Financial—peers represent public CA , AZ, HI, NV, OR & WA banks with assets $2 - $25 billion. | Peer Data as of 3/31/12 Deposit Cost Comparison 0.00% 0.50% 1.00% 1.50% 2.00% 2.50% 3.00% 2007 2008 2009 Q1 2010 Q2 2010 Q3 2010 Q4 2010 Q1 2011 Q2 2011 Q3 2011 Q4 2011 Q1 2012 Q2 2012 CVBF Peers |
![]() 6 Months 6/30/11 6 Months 6/30/12 % Change Service Charges on Deposit Accounts $7,751,943 $8,191,960 5.68% Service Charges/Total Deposits (Annualized) 0.31% 0.32% 13 *Includes Customer Repurchase Agreements Service Charge Income* Average Cost of Deposits 0.24% 0.16% |
![]() (000’s) Non-Covered Loans* Covered Loans* Total Loans* % Los Angeles County $1,153,762 $14,777 $1,168,539 34.07% Central Valley $599,848 $214,156 $814,004 23.73% Inland Empire (Riverside & San Bernardino Counties) $629,644 $2,480 $632,124 18.43% Orange County $468,057 $113 $468,170 13.65% Other $332,184 $15,123 $347,307 10.13% Total $3,183,495 $246,649 $3,430,144 100% *Prior to MTM discount and loan loss reserve *Prior to MTM discount and loan loss reserve (Includes loans Held for Sale) (Includes loans Held for Sale) as of 6/30/2012 Total Loans* |
![]() (000’s) *Removed Mortgage Pools and Construction Loans *Removed Mortgage Pools and Construction Loans Adjusted Non-Covered Loans* $515 million $188 million $188 million Total Non-Covered Loans $3,800,000 $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 Q3 2009 Q4 Q1 2010 Q2 Q3 Q4 Q1 2011 Q2 Q3 Q4 Q1 2012 Q2 |
![]() 16 Source: Q2 2012 earnings release & company reports | *Non-covered loans Total Loans by Type Total Loans by Type Commercial RE Non-Owner Occupied 39.5% Consumer 1.5% SFR Mortgage 5.0% Municipal Lease Finance Receivables 3.4% Auto & Equipment 0.5% Dairy, Livestock & Agribusiness 9.1% Commercial & Industrial 16.5% Construction RE 2.2% Commercial RE Owner Occupied 22.3% Loan Portfolio Composition* |
![]() (000’s) Net of Discount $184 million $36.5 million Includes Loans Held for Sale Total Covered Loans $- $100,000 $200,000 $300,000 $400,000 $500,000 $600,000 $700,000 $800,000 Q4 2009 Q1 2010 Q2 Q3 Q4 Q1 2011 Q2 Q3 Q4 Q1 2012 Q2 |
![]() 18 Non-Performing Assets Non-Covered |
![]() Loan Loss Allowance/ Charge-Offs --Non-Covered -- |
![]() 20 Classified Loans Non-Covered |
![]() CVBF’s strong loan underwriting culture has limited its exposure to problem credits Continued profitability has allowed CVB to build its capital base and reserves for loan losses. Superior Credit Quality Texas Ratio Texas Ratio NPA’s/Loans & OREO NPA’s/Loans & OREO Source: Q2 2012 earnings release & other company filings, SNL Financial—peers represent public CA , AZ, HI, NV, OR & WA banks with assets $2 -$25 billion. | Peer data as of 3/31/12 Non-Covered |
![]() Profits Profits |
![]() (000’s) Net Income After Taxes Net Income After Taxes $23.6 Million $23.6 Million Net Income |
![]() 2008 2009 2010 2011 Six Months to 6/30/2012 Net Interest Income $193,679 $222,264 $259,317 $234,681 $121,562 Provision for Credit Losses ($26,600) ($80,500) ($61,200) ($7,068) $0 Other Operating Income/Expenses (Net) ($81,331) ($52,515) ($111,378) ($106,809) ($51,613) Income Taxes ($22,675) ($23,830) ($23,804) ($39,071) ($24,062) Net Profit After Tax $63,073 $65,419 $62,935 $81,733 $45,887 24 (000’s) Earnings |
![]() 25 *Normalized excludes accelerated accretion on covered loans Normalized* Normalized* Net Interest Margin |
![]() Source: Q2 2012 earnings release & other company filings, SNL Financial—peers represent public CA , AZ, HI, NV, OR & WA banks with assets $2 - $25 billion. | Peer data as of 3/31/12 Net Interest Margin Return on Average Assets Return on Average Tangible Equity Peer Profitability Metrics |
![]() Expenses Expenses |
![]() 28 Expenses |
![]() Capital Capital |
![]() Regulatory Minimum Ratio Regulatory Well-Capitalized Ratio March 31, 2012 Tier 1 Risk-based Capital Ratio 4.0% 6.0% 18.18% Total Risk-based Capital Ratio 8.0% 10.0% 19.44% Tier 1 Leverage Ratio 4.0% 5.0% 11.35% Tangible Capital Ratio 4.0% 5.0% 10.38% Core Tier 1 Capital Ratio 15.57% 30 Capital Ratios |
![]() 31 Source: Q1 2012 earnings release & other company filings, SNL Financial—peers represent public CA , AZ, HI, NV, OR & WA banks with assets $2 - $25 billion Peer Capital Metrics Tier 1 Capital Ratio Total Risk – Based Capital Ratio Tangible Common Equity/Tangible Assets |
![]() Securities/Investments Securities/Investments |
![]() Source: Q2 2012 earnings release. As of 06/30/2012 securities held-to-maturity were valued at approximately $2.2million | Yield on securities represents the fully taxable equivalent *Securities Available For Sale Securities portfolio totaled $2.3 billion at 6/30/2012. The portfolio represents 34.7% 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. 99% of the Bank’s municipal portfolio contains securities which have an underlying rating of investment grade. California municipals represent only 4 % of the municipal bond portfolio Government Agency & GSEs 1.43% MBS 38.17% CMO 31.87% Municipal Bonds 28.07% Yield on securities Yield on securities portfolio = 2.91% portfolio = 2.91% for the 2 for the 2 Quarter 2012 Quarter 2012 Securities Portfolio* --$2.3 Billion-- Trust Preferred 0.46% nd |
![]() Securities Portfolio* $2.3 Billion Mark-to-Market (Pre-tax) (000’s) *Securities Available For Sale $75,145 $75,145 MBS & CMO’s $32,613 Municipal Municipal Bonds Bonds $42,323 $42,323 Other Securities Other Securities $209 $209 |
![]() 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 CVBF Assets |
![]() 12/31/06 $5.7 Billion 6/30/12 $5.8 Billion TOTAL DEPOSITS* Jr. Subordinated Debentures Other Liabilities BORROWINGS Jr. Subordinated Debentures BORROWINGS TOTAL DEPOSITS* Other Liabilities *Includes Customer Repurchase Agreements CVBF Liabilities |
![]() Our Growth Strategy Our Growth Strategy |
![]() Citizens Business Bank will strive to Citizens Business Bank will strive to become the dominant financial services become the dominant financial services company operating throughout the state company operating throughout the state of California, servicing the of California, servicing the comprehensive financial needs of comprehensive financial needs of successful small to medium sized successful small to medium sized businesses and their owners. businesses and their owners. 38 Our Vision |
![]() 39 The best The best privately-held and/or family-owned privately-held and/or family-owned businesses throughout California businesses throughout California — — Annual revenues of $1-200 million Annual revenues of $1-200 million — — Top 25% in their respective industry Top 25% in their respective industry — — Full relationship Full relationship banking banking — — Build 20-year relationships Build 20-year relationships Target Customer |
![]() 40 Acquisitions Acquisitions --Banks-- --Trust-- Same Store Same Store Sales Sales DeNovo DeNovo Three Areas of Growth |
![]() • • Target size: $200 million to $2 billion in assets Target size: $200 million to $2 billion in assets • • Financial & Strategic Financial & Strategic • • In-market and/or adjacent geographic market In-market and/or adjacent geographic market (California only) (California only) --Banks-- --Banks-- --Trust/Investment-- --Trust/Investment-- • • Target size: AUM of $200 million to $1 billion Target size: AUM of $200 million to $1 billion • • In California In California --Banking Teams-- --Banking Teams-- • • In- In- market & ‘new’ market & ‘new’ markets markets Acquisition Strategy |
![]() • • Quality Loan Growth Quality Loan Growth • • Non-Interest Bearing Deposit Growth Non-Interest Bearing Deposit Growth • • Non-Interest Income Growth Non-Interest Income Growth • • Expense Control Expense Control • • Grow Through Acquisition Grow Through Acquisition Our ‘Critical Few’ |
![]() 43 • • Strong Capital position Strong Capital position • • Strong, disciplined credit underwriting/credit culture Strong, disciplined credit underwriting/credit culture • • Drive low-cost, sustainable deposits Drive low-cost, sustainable deposits • • Multiple forms of growth (don’t depend on one) Multiple forms of growth (don’t depend on one) • • Same Store Sales Same Store Sales • • DeNovo DeNovo • • Acquisitions Acquisitions • • Cross-sell: capture the whole wallet Cross-sell: capture the whole wallet • • Build new Fee Income opportunities Build new Fee Income opportunities • • Long-term outlook Long-term outlook Our Strategic Focus |
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