Sponsor of Audience Response System. Grant Thornton. All rights reserved.

Transcription

1 Sponsor of Audience Response System

2 1. Between now and next year's Acquire or Be Acquired (Jan at the Phoenician), do you believe that the U.S. economy will: 1. Improve 45% 2. Remain the same 46% 3. Get worse 9%

3 2. Between now and next year s conference, do you expect the number of people you employ at your bank to: 1. Increase 46% 2. Remain the same 40% 3. Decrease 14%

4 3. What do you feel is the top risk your bank currently faces? 1. Credit risk 2. Liquidity risk 2% 3. IT risk 3% 41% 4. Compliance risk due to uncertain regulatory developments 40% 5. Other 13%

5 4. Looking ahead over the next 12 months, what changes do you expect to see in loan demand? 1. No change 38% 2. I expect an increase in loan demand. 53% 3. I expect a decrease in loan demand. 9%

6 5. Looking ahead over the next 12 months, what changes do you expect to see in loan delinquencies? 1. No change 39% 2. I expect to see an increase in loan delinquencies 12% 3. I expect to see a decrease in loan delinquencies 49%

7 6. What is the top way your bank plans to grow over the next year? 1. Organic loan origination 56% 2. Purchase of loan pools 3% 3. Merger and Acquisitions 26% 4. New revenue sources 7% 5. Non-lending investment activities 3% 6. Using more advantageous tax strategies and structures 1% 7. Other 4%

8 7. For the 1,000 or so banks between $1 billion and $25 billion in size, the greatest challenge to their profitability this year is: 1. Increased regulatory compliance costs 12% 2. Limits on growth due to insufficient capital 4% 3. Limits on loan growth due to economic uncertainty 20% 4. Continued margin pressure due to low interest rates 44% 5. Continued asset quality problems 10% 6. Possibility that European financial crisis could trigger a U.S. recession 11%

9 8. Have you acquired a healthy bank in the last 24 months? 1. Yes 13% 2. No, but we plan to acquire a healthy bank in the future. 3. No, and we have no plans to acquire a healthy bank in the future. 41% 46%

10 9. Have you bid on an FDIC-assisted transaction in the last 24 months? 1. Yes, we were successful acquirers 7% 2. Yes, but we were not successful acquirers. 12% 3. No, but we plan to participate in the future. 3% 17% 4. No, and we have no plans to participate. 64%

11 10. If you answered Yes to question 9, what was the biggest challenge. 1. Accounting 18% 2. Loss share compliance 3. Integration 12% 4. Bidding process 5. Due diligence 13% 29% 28%

12 11. What is the greatest unknown your board wrestles with when considering an M&A transaction? 1. Quality of the acquired institution s loan portfolio 50% 2. Deposit quality of the acquired institution 1% 3. Post-acquisition integration issues 17% 4. Potential regulatory impact of the acquisition 3% 5. Cultural fit of the acquired institution 23% 6. Other 7%

13 12. What do you consider to be the greatest challenge to overcome in a successful post - merger integration? 1. Cultural compatibility 2. Alignment of systems and internal control environment 21% 3. Obtaining sufficient cost reductions to justify valuation 4. Effective and ongoing communication 5. Other 2% 8% 35% 34%

14 13. Is your bank using social media to achieve growth in new demographics? 1. Yes 34% 2. Not yet, but we plan to use social media in the future. 32% 3. No 34%

15 14. Is your bank growing its mortgage lending activities? 1. Yes 2. Not yet, but we plan to grow our mortgage lending activities in the future. 14% 60% 3. Not yet, but we plan to grow our mortgage lending activities in the future. 26%

16 15. If you answered No to question 14, why not? 1. Our mortgage lending business is healthy 22% 2. Concerns about regulatory environment 43% 3. Concerns over servicing costs 2% 4. Concerns over incentive compensation issues 2% 5. Concerns about credit risk 8% 6. Other 22%

17 Sponsor of Audience Response System