Exhibit 99.1
Exhibit 99.1
Fulton Financial Corporation
Investor Presentation
June 2004
Fulton Financial Corporation 1
Forward-looking statement
The following presentation may contain forward-looking statements about Fulton Financial Corporation’s growth and acquisition strategies, new products and services, and future financial performance, including earnings and dividends per share, return on average assets, return on average equity, efficiency ratio and capital ratio. Forward-looking statements are encouraged by the Private Securities Litigation Reform Act of 1995.
Such forward-looking information is based upon certain underlying assumptions, risks and uncertainties. Because of the possibility of change in the underlying assumptions, actual results could differ materially from these forward-looking statements. Risks and uncertainties that may affect future results include: pricing pressures on loans and deposits, actions of bank and non-bank competitors, changes in local and national economic conditions, changes in regulatory requirements, actions of the Federal Reserve Board, the Corporation’s success in merger and acquisition integration, and customers’ acceptance of the Corporation’s products and services.
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Presentation outline
Corporate profile
Strategic initiatives
Asset quality
Future direction
Financial performance
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Fulton Financial profile
Regional financial holding company (formed in 1982)
12 bank subsidiaries and 3 financial services subsidiaries in 5 states
Asset size: $10.5 billion
Second largest commercial bank headquartered in Third Federal Reserve District
Fulton Bank founded in 1882
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Where are we located?
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Assets by affiliate
(as of 3/31/04, in thousands)
Fulton Bank $ 4,052,000
Lafayette Ambassador Bank 1,202,000
The Bank 1,049,000
Resource Bank 886,000
Lebanon Valley Farmers Bank 772,000
Premier Bank 533,000
Hagerstown Trust Company 462,000
Skylands Community Bank 422,000
Delaware National Bank 361,000
FNB Bank, N.A. 289,000
Swineford National Bank 279,000
The Peoples Bank of Elkton 108,000
Fulton Financial Corporation 6
Fulton Financial Advisors, N.A.
Includes Dearden Maguire Weaver and Barrett, LLC and Fulton Insurance Services Group
As of March 31, 2004:
$5.3 billion; $3.8 billion in assets under management
Products and Services
Personal trust
Asset management
Retirement services
Brokerage
Insurance
Corporate trust
Cash management
Private banking
Named Community-Based Bank Brokerage Program of the Year in 2003 by Bank Insurance and Securities Association (BISA)
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Fulton Mortgage Company
Coordinates residential mortgage lending throughout 11 affiliates
Expanded, competitive product line to customers of all affiliates
In partnership with each affiliate, focused management team on residential mortgages
Entry into new markets for FFC
Record originations in 2003
Residential lending at Resource Bank provided through Resource Mortgage
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Mission statement
We will increase shareholder value and enrich the communities we serve by creating financial success together with our customers and career success together with our employees.
We will conduct all of our business with honesty and integrity.
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Corporate ethics
Longstanding written code of conduct
No “gray” areas
Expectations clearly outlined
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What have we accomplished?
8.8% compounded annual growth rate in earnings per share
22 consecutive years of record earnings
30 consecutive years of dividend increases
10.3% compounded annual growth rate in dividends per share
Proven business model
Consistent performance
Fulton Financial Corporation 11
Five-year performance
1998 2003
Net income per share $ .84 $ 1.22
Cash dividends per share $ .35 $ .59
Return on assets 1.60% 1.57%
Return on equity 15.06% 15.45%
Efficiency ratio 55.30% 53.80%
Dividend payout 41.60% 48.70%
Restated for 5% stock dividend declared in April, 2004.
Fulton Financial Corporation 12
Stock highlights (as of 03/31/04)
Average daily trading volume 116,730
Number of analysts 11
Number of market makers 35
Number of shares outstanding 117.2 million
Market capitalization $2.59 billion
Annual meeting attendance 2,000 shareholders
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Employee stock ownership
70% of our employees collectively own more than 2 million shares of Fulton Financial Corporation stock
Stock options help us to retain high-performing, long-term employees
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Stock performance (2003)
WITHOUT dividend reinvestment:
15% compounded annual rate of return
WITH dividend reinvestment:
19% compounded annual rate of return
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Employee retention
Exempt
Non-exempt
Overall
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Employee opinion survey
Customer service
Management team performance
Company image and mission
Team orientation
Technology and systems
Training and development
Sales orientation
Work effectiveness
Pay and benefits
Employee satisfaction
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Customer satisfaction
96% of our customers are Extremely or Very Satisfied with their Fulton Financial affiliate bank
86% of our commercial customers are Satisfied or Very Satisfied with us
Compared to national average of 55% of customers who are very satisfied with their financial institution*
* Source: 2003 American Banker/Gallup consumer survey
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Deposit composition trends
Mar. ‘04 Mar. ‘03
Non Interest-Bearing Demand 18% 19%
Interest-Bearing Demand 18% 16%
Money Market 13% 13%
Savings 11% 10%
Time Deposits 34% 37%
Customer Repos 6% 5%
Total Deposits 100% 100%
Fulton Financial Corporation 19
Funding sources
as of 3/31/04
1%
14%
10%
75%
Deposits and Customer Repurchase Agreements
Capital (GAAP)
Other Borrowings
Other Liabilities
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Community involvement
Employees are actively involved in their own communities
The community benefits from this support
The banks receive additional business as a result of the relationships and goodwill that are developed
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Corporate strategic initiatives
Achieving consistent earnings growth
Maintaining high asset quality
Expanding the franchise through our well-developed acquisition strategy
Diversifying revenue stream by increasing the contribution of non-interest income
Managing capital
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Capital (At March 31, 2004)
Total Capital (GAAP): $968 million
Total Regulatory Capital: $908 million
Ratios:
Total Risk-based Capital 13.0%
Tier 1 Risk-based Capital 11.8%
Leverage Capital 8.7%
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Acquisitions
Resource Bank
Premier Bank
Drovers & Mechanics Bank
18 Sovereign Bank Branches
Dearden, Maguire, Weaver and Barrett, Inc.
Skylands Community Bank
Ambassador Bank of the Commonwealth
Lebanon Valley National Bank
Peoples Bank of Elkton
Woodstown National Bank & Trust Company
Bank of Gloucester County
Delaware National Bank
Central Pennsylvania Savings Association
Hagerstown Trust Company
Denver National Bank
Great Valley Savings Association
First National Bank of Danville
Second National Bank of Nazareth
Lafayette Trust Bank
Pen Argyl National Bank
Swineford National Bank
Farmers Trust Bank
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Premier Bank
Acquired on August 1, 2003
Assets of $600 million
Headquartered in Bucks County, PA
Six branches in Montgomery and Bucks counties, the second and third wealthiest counties in Pennsylvania
Historical double-digit growth in deposits, loans, fee income and net income
Strong asset quality
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Resource Bankshares Corporation
Acquired on April 1, 2004
Assets of $860 million; headquartered in Virginia Beach, Virginia
The only Virginia-based bank with offices in Virginia’s three major markets
Market area accounts for over 71% of all deposits in state of Virginia
Allows for expansion of Fulton Financial Advisors, retail and commercial banking
Senior lenders average 24 years of industry experience
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What do we look for?
High growth areas
Dynamic market demographics
Strong performance
Asset quality
Talented and dedicated staff
Compatible corporate culture
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Acquisitions in new markets
What changes?
Replicate strong credit culture
Loan review
Investments
Asset/liability management
Compliance
Common operating platform
Audit
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Acquisitions in new markets
What stays the same?
Bank name
Board of Directors
Management team
Employees
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Benefits to new affiliates
Increased non-interest income due to introduction of new products and services
Additional capital
Increased lending capacity
Reduced expenses
Proven merger/conversion expertise
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Product availability
Investment management
Brokerage services
Insurance
(whole life, term life, long-term care through advisors)
Cash management
On-line banking
Debit/credit cards
Residential mortgages
Specialized lending (leasing and indirect)
International services
Correspondent banking
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Other Income As a Percent of Total Income
16.0% 16.2% 16.9% 17.9% 19.4% 22.9% 25.0% 27.0% 24.0%
96 97 98 99 00 01 02 03 3/04
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Growth in wealth management/ trust services revenue
$0.0 $6.0 $12.0 $18.0 $24.0 $30.0 $36.0
Dollars in millions
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Other income
$0.0 $20.0 $40.0 $60.0 $80.0 $100.0 $120.0
Dollars in millions
Note: In 2001, we acquired Dearden, Maguire, Weaver & Barrett, LLC
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Other income (YTD March)
2004 2003 $ %
(dollars in thousands)
Invt Mgt & Trust $ 8,640 $ 8,340 $ 300 4%
Deposit-related Revenue 3,800 3,540 260 7%
Service Charges 3,760 3,750 10 0%
Mort. Sales & Serv. 2,060 5,950 (3,890) -65%
Cash Mgt Revenue 1,940 1,920 20 1%
Success Card Revenue 1,240 1,230 10 1%
Merchant Revenue 1,230 1,010 220 22%
Other 3,730 3,660 70 2%
Total $ 26,400 $ 29,400 $ (3,000) -10%
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Moody’s Investor Service
Short-term rating P-1
Long-term rating:
Issuer A-2
Lead Bank Deposits A-1
Outlook: Positive
Fitch Ratings
Short-term rating F-1
Long-term rating A
Outlook: Stable
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Loan diversification (3/31/04)
Consumer and Other
Residential Mortgage
Commercial Loans
Home Equity
Commercial Mortgage
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Summary of larger loans
25 relationships with commitments to lend of $20 million or more
Maximum individual commitment of $30 million
Average commercial loan commitment is $546,000
Loans and corresponding relationships are within Fulton’s geographical market area
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Commercial loan concentration
by industry (as of 3/31/04)
Industry %
R/E—Rental 17.4
Construction 16.4
Services 14.1
Manufacturing 10.8
Retail 8.5
Health Care 8.2
Agriculture 6.9
Wholesale 5.3
Other 4.6
Arts and Entertainment 3.7
Transportation 2.2
Financial Services 1.9
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Possible Future Expansion
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Quarter ended March 31, 2004
$ 0.31 Net income per share
(3.3% increase over 2003)
$ 0.152 Cash dividends per share
(11.8% increase over 2003)
1.49% Return on assets
15.18% Return on equity
55.00% Efficiency ratio
Restated for 5% stock dividend declared in April, 2004.
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Average Balances (YTD March)
2004 2003 $ %
(dollars in millions)
Investments $ 2,830 $ 2,390 $ 440 18%
Loans 6,190 5,350 840 16%
Deposits 7,110 6,470 640 10%
Borrowings 1,500 850 650 76%
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Average Loan Growth (YTD March)
2004 2003 $ %
(dollars in millions)
Commercial $ 1,960 $ 1,690 $ 270 16%
Comm’l Mort 2,270 1,760 510 29%
Resid Mort 490 580 (90) -16%
Cons./Other 1,470 1,320 150 11%
Total Loans $ 6,190 $ 5,350 840 16%
Fulton Financial Corporation 43
Peer group
Commerce Bancorp
First Commonwealth Financial
First Financial Bancorp.
FirstMerit Corp.
Fulton Financial Corp
Hudson United Bancorp.
Mercantile Bankshares Corp.
North Fork Bankcorp.
Provident Bankshares Corp.
Riggs National Corp.
Sky Financial Group Inc.
Susquehanna Bancshares
TrustCo Bank Corp. of NY
United Bankshares Inc.
Valley National Bancorp
Wilmington Trust Co.
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Net charge-offs to average loans
90 91 92 93 94 95 96 97 98 99 00 01 02 03 3/04
Top 50
Peer
FFC
Source: SNL Financial Datasource
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Non-performing assets to total assets
Top 50
Peer
FFC
Fulton Financial Corporation 46
90 91 92 93 94 95 96 97 98 99 00 01 02 03 3/04
Net interest margin
Top 50
Peer
FFC
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Asset/Liability Management
Interest rate “shocks” (as of 03/31/04)
Rate Change NII Change (Annual) % Change
+300 bp + $ 23.1 million + 7.6%
+200 bp + $ 16.9 million + 5.5%
+100 bp + $ 13.3 million + 4.4%
-100 bp - $ 18.6 million - 6.1%
Source: FFC Asset/Liability Modeling
Fulton Financial Corporation 48
Investment portfolio
Portfolio Components Ending Bal. Average Credit
( in millions) 03/31/2004 Life (yrs.) Rating
Mortgage-backed securities $ 2,132.7 3.2 AAA—agency issued
Treasuries and agencies $ 82.6 0.5 AAA
Municipals $ 267.0 4.2 AAA—insured
Bank-issued trust preferred stock $ 16.1 16.7 various/callable: 5 yrs
Other/short-term Inv. $ 67.8 NA AAA
Bank stocks $ 75.5 NA not rated
FHLB stock $ 43.9 NA AAA
Unrealized gain—bank stock $ 12.1
Unrealized gain—bonds $ 12.2
TOTAL INVESTMENTS $ 2,709.9 3.3
NOTE : DOES NOT INCLUDE RESOURCE BANK
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Bank stock gains
(percent contribution to EPS)
91 92 93 94 95 96 97 98 99 00 01 02 03 3/04
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Efficiency ratio
90 91 92 93 94 95 96 97 98 99 00 01 02 03 3/04
Top 50
Peer
FFC
Source: SNL Financial Datasource
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Other Expenses (YTD March)
2004 2003 $ %
(dollars in thousands)
Salaries & Benefits $ 36,960 $ 33,320 $ 3,640 11%
Occupancy & Equip. 8,160 7,760 400 5%
Data Processing 2,820 2,860 (40) -1%
Advertising 1,530 1,230 300 24%
Telecommun. 1,260 1,230 30 2%
State Tax 1,360 1,290 70 5%
Stat. & Supplies 1,220 1,040 180 17%
Postage 1,070 1,040 30 3%
Operating Risk Loss 710 600 110 18%
Amortization 990 360 630 175%
Other Expenses 6,520 5,170 1,350 26%
Total $ 62,600 $ 55,900 $ 6,700 12%
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Corporate Governance
Internal controls over financial reporting process
SOX and NASDAQ listing standards
Independent directors determined
Executive sessions
Executive compensation and nominating committees
SOX compliant written Code of Conduct
Corporate disclosure committee and Audit committee -formal review process for relevant financial filings
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Looking ahead
Continued focus on:
Strong asset quality
Growth in non-interest income, particularly from Advisors
Expansion of franchise geographically
Increased loan activity
Core deposit growth
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Board of Directors
Focused on maximizing shareholder value with an annual increase in earnings per share in the range of 10%
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Overview
Shareholders
maximize shareholder value
Customers
create financial success
Employees
create career success
Communities
create prosperity
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Fulton Financial Corporation
One Penn Square
Lancaster, PA 17602
www.fult.com
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Where are we located?
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Possible Future Expansion
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