Ameriana Bancorp
Annual Meeting of
Shareholders
May 20, 2010
Forward-Looking Statement
This presentation contains forward-looking
statements, which include statements about
Ameriana’s future financial performance,
business plans and strategies. Forward-
looking statements involve future risks and
uncertainties, because of factors that could
cause actual results to differ materially from
those expressed or implied. Specific risk
factors and other uncertainties that could
affect the accuracy of forward-looking
statements are included in Ameriana’s Form
10-K for the year ended December 31, 2009.
Michael Kent
Chairman of the Board
Introduction of Directors:
Jerome J. Gassen – President and Chief Executive Officer – Ameriana
Bancorp
Ronald R. Pritzke – Vice Chairman of the Board, Ameriana Bancorp,
Partner - Pritzke & Davis
Donald C. Danielson – Vice Chairman of the Board – City Securities
Corporation
R. Scott Hayes – General Counsel, Senior Partner – Hayes Copenhaver
Crider
Charles M. (Kim) Drackett, Jr. – Chairman, President and General Manager
– Fairholme Farms Inc.
Richard E. Hennessey – Executive Vice President – Real Estate
Development – Shiel Sexton Company inc.
Michael E. Bosway – President and Chief Executive Officer – City
Securities Corporation
Paul W. Prior – Director Emeritus - Former President and Chairman of the
Board
Representing our Independent Auditor
BKD – Indianapolis Office
Troy Gilstorf
Partner - BKD
Steve Moore
Partner - BKD
Mike Ososki
Manager – BKD
Introduction of Senior Officers:
Timothy G. Clark – Executive Vice
President and Chief Operating Officer
John J. Letter – Senior Vice President –
Treasurer and Chief Financial Officer
Michael L. Wenstrup – Senior Vice
President and Chief Credit Officer
Nancy A. Rogers - - Senior Vice President –
Investor Relations and Corporate Secretary
Proxy Proposals
Election of Directors
Ratification of Appointment of
BKD, LLP as Independent
Auditor
Remarks of Mr. Kent:
Board is focused on two key objectives:
“Well Being” of the Company
Return on investment to shareholders
Long - term view
Well being of the Company
Bank’s financial condition – “Well Capitalized”
Approved for TARP
Strong Corporate Governance
The Company’s strategic plan and its goals and
objectives
Quality of Management
Remarks of Mr. Kent:
Corporate Governance
Disclosure Committee
Development, approval and implementation of
the long-range strategic plan
Independent Board Committees provide
oversight
Board education
Management Team Focus
Improving asset quality
Minimizing credit losses
Maintaining liquidity and capital
Comprehensive risk management approach
Jerome J. Gassen
President and CEO
Background Information
Headquarters – New Castle, Indiana
Henry County
15 Locations
- 13 Banking Centers
- 1 Loan Production Center
- 1 Insurance Office
# 1 Market Share in Henry County – 31.25%
- $213.8 Million in Deposits
# 4 Market Share in Hancock County – 10.83%
- $74.2 Million in Deposits
(FDIC summary of deposits 6/30/09)
Hamilton County
$25.0 Million in Deposits
(Source: FDIC)
Ameriana Bancorp - Profile
Line of Business Focus
Commercial/Business Lending
Mortgage Banking
Consumer Lending and Deposits
Ameriana Financial Services
Ameriana Insurance
Experienced Management Team
Enterprise Risk Management
Ameriana Bancorp Profile
“ Our mission and promise is to
engage every customer in
genuine and innovative ways, to
truly understand and embrace
their individual needs and
desires, so we can provide them
with the best financial solutions
and direction.”
Industry Challenges In 2009
Commercial
Deterioration of credit quality
Higher Industry NPAs
Higher provision expenses
Slowing absorption rates
Declining appraised values; higher cap rates
Industry Challenges In 2009
Residential
Record levels of residential foreclosures
nationwide
Decreased property values (20-40% declines in
appraised values)
Significantly increased sale times
Tightened secondary market and PMI standards
Government intervention is directing write-downs
on loans in foreclosure
Re-defaults
Industry Challenges In 2009
Bank failures
2008 – 25
2009 – 140
YTD – 72
Negative public opinion of bank
bailout/TARP
Regulatory expectations on capital and
liquidity
Ameriana – 2010 Key Objectives
Soundness – CAPITAL
Preserve and Build Capital
Reduce risk-based assets, if needed
Reduce expenses and pursue fee income
opportunities to increase net income
Evaluate raising capital from traditional capital
markets i.e.
Preferred stock
Subordinated debentures
Rights offering
Evaluate securitization of mortgage assets
Ameriana – 2010 Key Objectives
Soundness – Resolution of Problem Assets
Reduce NPAs and OREO
Minimize losses
Work with borrowers in distress if possible
Utilize skills of Special Assets Manager and Chief
Credit Officer to manage criticized and classified
assets
Ensure adequacy of ALLL
Ameriana – 2010 Key Objectives
Profitability
Maintain or improve Net Interest Margin
Increase Net Interest Income by increasing
earning assets and margin
Manage expenses
Grow other income from Ameriana Financial
Services and Ameriana Insurance
Ameriana – 2010 Key Objectives
Growth
Due to current economic conditions additional
significant growth initiatives have been placed on
hold
Ameriana Bancorp – Profile
(as of 12/31/2009)
Ameriana Bancorp – Consolidated ($ in 000s)
- Total Assets - $441,563
- Total Loans – Net of allowance - $321,544
- Total Deposits - $338,381
Ameriana Financial
- Assets under Management - $ 39.1 million
Ameriana Insurance
- Total Customers - 4,700
- P & C Revenues - - $779,000
2009 Financial Results
Net loss of $264,000 compared to $741,000 net income in
2008
Net interest income increased $896M or 7.6%
Interest rate spread improved by 55 basis points to 3.6%
at 12/31/09
Increased deposits by 4.3% to $338.4 million
Shrank the Investment Portfolio by 52.4% to 8.1% of total
assets
Sold 16.67% interest in Family Financial Holdings, Inc.
2009 Financial Results
2009 Earnings impacted by:
$930,000 increase in provision for loan losses
$797,000 increase in FDIC premiums
$255,000 increase in OREO expense
$149,000 increase in pension expense
Capital Ratios
(As of 3/31/10)
Ameriana Bank Actual Well-Capitalized
TIER 1 Leverage Ratio 8.54% 5.00%
TIER 1 Risk-Based Capital Ratio 11.58% 6.00%
Total Risk-Based Capital Ratio 12.83% 10.00%
($ in thousands)
(as of 12/31)
Total Loans
Loan Mix
(as of 12/31)
(% of total loans)
Commercial Real Estate Loans
Residential Real Estate Loans
Construction Real Estate Loans
Commercial Loans and Leases
Consumer & Municipal Loans
2007
2008
2009
Total Deposits
(as of 12/31)
($ in thousands)
(*2005 includes brokered CD’s of $9,977,000)
*
Deposit Mix
(as of 12/31)
% of total deposits
Noninterest-bearing Deposits
NOW Deposits
Money Market Deposits
Savings Deposits
2007
2008
2009
Certificates of Deposits
($ in thousands)
(as of 12/31)
Net Interest Income
Net Interest Margin
(as of 12/31)
(Net Interest Margin is Net Interest Income presented on a tax
equivalent basis as a % of average interest - earning assets)
Credit Quality
(as of 12/31)
Classified and Criticized Loans
($ in thousands)
Credit Quality
(as of 12/31)
Non-Performing Loans
($ in thousands)
Credit Quality
(as of 12/31)
Non-Performing Loans/Total Loans
(% of total loans)
Credit Quality
(as of 12/31)
OREO
($ in thousands)
Credit Quality
(as of 12/31)
Charge - offs
Credit Quality
Net Charge – offs / Total Loans
(as of 12/31)
2005
2006
2007
2008
2009
Credit Quality
(as of 12/31)
Allowance for Loan Losses
($ in thousands)
$2,835
$2,616
$2,677
$2,991
$4,005
Credit Quality
(as of 12/31)
Allowance for Loan Losses
(% of total loans)
