Exhibit 99.2
Greater Bay Bancorp slide presentation
for October 2003 conferences
Greater Bay Bancorp
Financial Services Conferences
October 28, 2003 and October 29, 2003
Greater Bay Bancorp
Certain matters discussed in this press release constitute forward-looking
statements within the meaning of the Private Securities Litigation Reform Act of
1995. These forward looking statements relate to the Company’s current
expectations regarding future operating results, net interest margin, net loan charge-
offs, asset quality, level of loan loss reserves, growth in loans and deposits, the
impact of the S & C acquisition and the strength of the local economy. These
forward looking statements are subject to certain risks and uncertainties that could
cause the actual results, performance or achievements to differ materially from those
expressed, suggested or implied by the forward looking statements. These risks and
uncertainties include, but are not limited to: (1) the impact of changes in interest
rates, a decline in economic conditions at the international, national and local levels
and increased competition among financial service providers on the Company’s
results of operations, the Company’s ability to maintain its net interest spread, and
the quality of the Company’s earning assets; (2) any difficulties that may be
encountered in integrating S&C and in realizing operating efficiencies; (3)
government regulation; and (4) the other risks set forth in the Company‘s reports
filed with the Securities and Exchange Commission, including its Annual Report on
Form 10-K for the year ended December 31, 2002. Greater Bay 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.
Company Snapshot
September 30, 2003
$15.3 million
Perpetual Preferred
$80.4 million
Convertible Preferred
Preferred Equity:
$640.4 million
Common Equity
$101.2 million
LTM Net Income
$7.8 billion
Assets
$1.3 billion
Market Value*
52.2 million
Shares Outstanding
GBBK
Nasdaq NM
Greater Bay Bancorp
Company Name
* Calculated using closing price of GBBK stock on 10/23/03
Franchise Overview
Regional Community Banking
Formed in late 1996 with merger of Cupertino
National Bancorp and Mid-Peninsula Bancorp
Currently largest independent community bank
holding company headquartered in Northern
California with assets of $7.8 billion, loans of $4.6
billion and deposits of $5.4 billion
Diversified financial services company offering a full
range of products and services
Business Banking focus (small and mid-sized businesses)
Personal Banking presence among high net worth individuals, owners/managers of business
banking clients and custom banking for individuals
Trust and investment services
Insurance brokerage services
Unique characteristics of GBBK
“Regional Community Banking” – maintain strong community
involvement in order to fully understand client’s business and personal
needs
Opportunistic and strategic acquirer of financial services companies
Eleven community banks with 42 offices in 8
counties located in the San Francisco Bay
area
Franchise Overview
Proven Ability to Manage
Acquired Businesses
Formation of GBBK
$0.6 B
Acquired Growth
$3.0 B
Organic Growth
$4.2 B
Total Assets
$7.8 B
Acquisition Strategy
“Ring the Bay”
Greater Bay now has a presence in all of the key
sub-markets of the San Francisco Bay Area
2003
1996
Successful Acquisition Strategy
14 acquisitions completed since formation, adding $3.0 billion
in assets and extending market reach throughout the San Francisco Bay Area
N/A *
ABD Insurance and Financial Services
03/02
N/A**
Sullivan & Curtis Insurance Brokers
07/03
$285
The Matsco Companies
11/00
$680
San Jose National Bank
12/01
$15
CAPCO Financial Company, Inc.
03/01
$200
Bank of Petaluma
10/00
$400
Bank of Santa Clara
07/00
$400
Coast Commercial Bank
05/00
$250
Mt. Diablo National Bank
01/00
$200
Bay Bank of Commerce
10/99
$200
Bay Area Bank
05/99
$15
Pacific Business Funding
08/98
$150
Golden Gate Bank
05/98
$200
Peninsula Bank of Commerce
12/97
$ in Millions
* Gross annual revenues of $110 million
** Gross annual revenues of $10 million
Assets at
Date of Acquisition
Diversified Financial Services Provider
Business Lines
Greater Bay Bancorp
Regional
Banking
ABD
Insurance
Specialty
Finance
Wealth
Management
Premiums >$1
billion *
Revenue >
$120 million
Offering P&C,
D&O,
Employee
Benefits, 401k
Products
* No underwriting risk
11 Banks
42 Offices
Local Client
Decision
Making
Local
Management
and Board
International/
Trade Finance
Leasing
Factoring
Asset Based
Lending
SBA Lending
Trust
Private
Banking
ABD Insurance and Financial Services
We completed the acquisition of ABD
Insurance and Financial Services
(currently the 20th largest commercial
insurance brokerage agency in the
country) in March 2002
It has been a very successful partnership
and, during the first three quarters of
2003, ABD provided $89.8 million in fee
income with no underwriting risk
Significant Growth in Insurance Income
Product Focus
P & C
D & O
Employee benefits
401K products
Great opportunity for cross selling relationships
ABD completed the acquisition of Sullivan and
Curtis Insurance Brokers in July 2003. The firm
reports annual revenues of approximately $10
million. The acquisition will be neutral to 2003
earnings and marginally accretive to 2004
earnings.
ABD Insurance and Financial Services
Experienced Senior Management Team
25+
Peggy Hiraoka
EVP, Human Resources
15+
Shawn E. Saunders
EVP, Finance and Accounting
20+
Kenneth Shannon
Chief Risk Officer
30+
Kimberly Burgess
Chief Administrative Officer
25+
Gregg Johnson
Chief Information Officer
25+ Avg.
Community Bank Presidents
Chief Financial Officer
President & Chief Operating Officer
Chief Executive Officer
Position
25+
Steven C. Smith (1)
25+ Avg.
20+ Avg.
25+
Byron A. Scordelis
35+
David L. Kalkbrenner
Years Experience
Name
(1) Announced intention to retire at end of 2003. Mr. Smith will continue his employment until a successor is chosen, which is expected by the
end of the year. Mr. Smith will also continue on as a consultant to the Company going forward.
Community Bank Boards of Directors
90 diversified and seasoned directors
GBB Board of Directors
18 diversified and seasoned directors
Q3 2003 Financial Highlights
Net Income - $22 million
Fully Diluted EPS - $0.39
Return on Average Assets of 1.11%
Return on Average Tangible Assets of 1.14%
Return on Average Common Equity of 13.93%
Return on Average Tangible Equity* of 16.94%
* Average tangible equity includes average convertible preferred stock of $80.4 million
and excludes average intangibles of $193.6 million
Q3 2003 Financial Highlights
Non-interest income $44 million – 38% of Total
Revenue
Core Deposit Growth – 5% year over year
Loan Growth – $48 million in year over year
loan growth in our business portfolio offset by
payoffs in Shared National Credit (SNC)
portfolio ($29 million) and Real Estate
construction portfolio ($111 million)
Non-Interest Income (1)
(1)
As a result of the ABD acquisition in March 2002, the Company’s 2002 results
included insurance agency commissions and fees totaling $88.5 million. There were
no such insurance agency commissions in 2001.
37.0%
$131.0
31.0%
$155.5
12.7%
$44.8
% of Total
Revenue
Total $
% of
Total
Revenue
Total $
% of
Total
Revenue
Total $
YTD Q3’03
2002
2001
Grow insurance agency fees
Expand wealth management capability
Credit quality stabilized
Loan loss reserves continue to exceed our
peers
Current outstandings in the non-
relationship SNC portfolio are $21 million
and the SNC allowance for loan and lease
losses is $8 million
Credit Quality
Credit Quality
0.14%
0.61%
0.75%
Non-performing Assets to Total Assets
0.27%
0.99%
1.26%
Non-performing Loans to Total Loans
$9.1
$49.0
$58.1
Total Non-performing Assets
-2.5
2.5
-
OREO
11.6
46.5
58.1
Total Non-performing Loans
2.2
0.4
2.6
Other
-0.1
6.5
6.4
Specialty Finance
-0.2
3.8
3.6
Venture Banking Group
1.7
13.5
15.2
Shared National Credits
3.5
2.9
6.4
SBA
3.3
14.1
17.4
Real Estate Term and Construction
$1.2
$5.3
$6.5
Commercial
Variance
Q2 2003
Q3 2003
NON-PERFORMING ASSETS ($ in millions)
* Custom peer group defined by GBBK – see schedule A
Credit Quality
Q3 2003
Trends in the Level of
Allowance and Charge-offs
Net Charge-offs Peaked in 2002
Net Interest Margin
Management in a Volatile Environment
* End of period NIM is higher at 4.16%
*
Net Interest Margin
GBBK is asset sensitive
Over the last year, MBS portfolio has
declined approximately $588 million as
planned
Investment strategy continues to be to
invest in short duration securities
Give up current yield for stable value
Position Company to take advantage of
rising rates in 2004 and beyond
Diversified Real Estate Portfolio
Loans by Owner Occupied
RE Term
$1.7 billion, 36% of Loans
RE Construction
$0.5 billion, 10% of Loans
Financial data as of 9/30/03
Diversified Real Estate Portfolio
Loans by Location (County)
RE Term
$1.7 billion, 36% of Loans
RE Construction
$0.5 billion, 10% of Loans
Financial data as of 9/30/03
Diversified Real Estate Portfolio
Loans by Classification
RE Term
$1.7 billion, 36% of Loans
RE Construction
$0.5 billion, 10% of Loans
Financial data as of 9/30/03
Capital Strength
13.21%
10.45%
7.95%
7.14%
13.49%
11.07%
7.97%
7.24%
13.90%
12.64%
9.49%
7.07%
10.00%
6.00%
5.00%
N/A
Leverage Ratio
Total Risk Based Capital
Tier I Risk Based Capital
Tangible Equity Ratio
(1)
Tangible Equity includes Shareholders' Equity, Convertible Preferred Stock and REIT Preferred
Securities, less Goodwill and Other Intangibles.
(2)
Custom peer group defined by GBBK – see schedule A
(3)
Top 75 banks by asset size at June 30, 2003
Top 75
Banks(3)
6/30/03
Peer
Group(2)
6/30/03
GBBK(1)
9/30/03
Minimum to be
Well-Capitalized
Our emphasis on increasing capital ratios
during the past year has resulted in a
tangible equity to asset ratio of 7.07%, up
from 6.10% at September 30, 2002
All other capital ratios are substantially in
excess of regulatory well capitalized
guidelines and peers
Capital Strength
Economic Capital as a Foundation for
Enterprise-wide Risk Management
We are utilizing an economic capital allocation
model developed by ERisk that incorporates
economic factors, historical factors and our actual
operating results to measure our capital levels in
relation to our risk profile
Results show returns on risk adjusted capital by
business line
Results provide framework, based on risk appetite
correlated to ratings targets, to optimize capital
allocation for enhancing shareholder returns
Required Economic Capital Formulated
to GBBK Risk Appetite(1)
This chart provides an initial look at
GBBK’s economic capital position vs.
the economic capital required to
achieve various credit ratings
GBBK’s Tangible Equity does not
include the value of ABD which
currently is locked up in goodwill, but
is worth more today than when we
acquired ABD in early 2002
GBBK’s Tangible Equity does not
include an allocation of loan loss
reserves in excess of expected losses
– a very conservative assessment
(1) No impact on regulatory capital ratios which continue to be maintained above well-capitalized levels
(2) Data as of 9/30/03
Return on Risk Adjusted Capital
by Business Unit
24%
2.7
46
Matsco
17%
$22.4
$521
Total Greater Bay
0%
101
Excess Capital
21%
22.4
420
Total Required
38%
0.2
2
Greater Bay Trust
42%
3.3
32
ABD
19%
$16.2
$340
Core Banks
Risk Adjusted
Return on
Capital (3)
Economic
Capital
Required (1)
($ in millions)
(1)
Required for A / A2 rating per ERisk model
(2)
Net Income rounded to nearest million
(3)
Annualized
0
Q3’03
Net
Income (2)
Looking Forward:
Our Strategy for 2004 and Beyond
Our Future is a Reaffirmation of
Our Past
The Bay Area economy is mired in an
economic slump which has affected our
state and our nation, but
We believe that this remains one of the
greatest economic regions in the world
And the Bay Area will remain the focal point
of our strategic future
“ We are heartened that expectations for the
next six months have improved and are
keeping our fingers crossed that this
growing confidence can produce capital
spending to grease the gears of the
economy and jumpstart positive growth.”
Bay Area Council
Business Confidence Survey
May 2003
Bay Area Dominates Venture
Investment
Regional Investment in the US in Q203 ($1.4 billion)
Source: PwC/Venture Economics/National Venture Capital Association MoneyTreeTM Survey
Q3 2003 Data not yet available
Strategic Goals
Reaching greater critical mass in the
Company's market areas
Generating increased fee income
through cross-selling broader services
Continue to diversify revenue stream
Continue to mitigate and proactively
manage risk
Opportunistic market expansion
Mitigate and Proactively Manage Risk
Enterprise-wide Risk Management
Maintain Credit Quality
Loan Concentration Analysis
Focus on Relationships
Economic Capital Analysis
Market Concerns About GBBK
The Northern California economy, the state
deficit, the dot com fall-out and the technology
industry in Silicon Valley
Real estate valuations, lease rates and vacancy
factors in the San Francisco Bay Area
Impact of additional Fed rate decreases on net
interest margin
Market perception of GBBK’s credit quality and
overall risk profile
Guidance
Loan growth
Focus on quality and relationships
Business loan growth is anticipated to
continue during the balance of 2003;
however, it will continue to be offset by
payoffs in the SNC and construction loan
portfolio.
Deposit growth
Committed to expanding deposit base and
selectively adding new clients that fit
5% to 10% annualized growth for the
remainder of the year
Net interest margin
Continued pressure due to economic
conditions and competitive environment
For every 25 bps decline in market interest
rates, net interest margin is expected to
decline approximately 10-20 bps, depending
on the mix of assets and liabilities
Credit quality – net charge offs estimated to be
in the 60-70 bps range for 2003
Guidance
Investment Rationale
Well Positioned for an
Economic Upturn
Our franchise provides competitive
opportunities
Asset sensitive balance sheet
Internal capital generation will support future
growth
Stable credit quality
Increase in fee income from insurance agency
and wealth management
Increased business activity will bring higher
commercial loan volume
Long Term Shareholder Returns
Total shareholder return, including the reinvestment of dividends
11/27/96 – 9/30/03
401%
137%
132%
206%
Schedule A – Custom Peer Group
Allfirst Financial, Inc.
Fulton Financial Corporation
Associated Banc-Corp
Greater Bay Bancorp
BancorpSouth, Inc.
Hibernia Corporation
Bank of Hawaii Corporation
Hudson United Bancorp
BOK Financial Corporation
International Bancshares Corporation
Bremer Financial Corporation
Mercantile Bankshares Corporation
Central Bancompany
Old National Bancorp
Citizens Banking Corporation
Provident Financial Group, Inc.
City National Corporation
RBC Centura Banks, Inc.
Colonial BancGroup, Inc.
Riggs National Corporation
Commerce Bancorp, Inc.
Sky Financial Group Inc.
Commerce Bancshares, Inc.
South Financial Group, Inc. (The)
Community First Bankshares, Inc.
Southwest Bancorporation of Texas, Inc.
Cullen/Frost Bankers, Inc.
Susquehanna Bancshares, Inc.
F.N.B. Corporation
Synovus Financial Corp.
FBOP Corporation
TCF Financial Corporation
First Banks, Inc.
Trustmark Corporation
First Citizens BancShares, Inc.
UMB Financial Corporation
First Midwest Bancorp, Inc.
United Bankshares, Inc.
First National of Nebraska, Incorporated
Valley National Bancorp
Whitney Holding Corporation
Firstbank Holding Company of Colorado
Wilmington Trust Corporation
FirstMerit Corporation