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1st Quarter 2014
Forward Looking Statement
The numbers, as of and for the quarter ended March 31, 2014, contained within this presentation are
unaudited. Certain statements contained herein may be considered “forward-looking statements” as
defined in the Private Securities Litigation Reform Act of 1995. These statements are based upon the
belief of the Company’s management, as well as assumptions made beyond information currently
available to the Company’s management and, may be, but not necessarily are identified by such words
as “expect”, “plan”, “anticipate”, “target”, “forecast” and “goal”. Because such “forward-looking
statements” are subject to risks and uncertainties, actual results may differ materially from those
expressed or implied by such forward-looking statements. Factors that could cause actual results to
differ materially from the Company’s expectations include competition from other financial institutions
and financial holding companies; the effects of and changes in trade, monetary and fiscal policies and
laws, including interest rate policies of the Federal Reserve Board; changes in the demand for loans;
fluctuations in value of collateral and loan reserves; inflation, interest rate, market and monetary
fluctuations; changes in consumer spending, borrowing and savings habits; and acquisitions and
integration of acquired businesses, and similar variables. Other key risks are described in the
Company’s reports filed with the Securities and Exchange Commission, which may be obtained under
“Investor Relations-Documents/Filings” on the Company’s web site or by writing or calling the Company
at 325.627.7155. The Company does not undertake any obligation to update publicly or revise any
forward-looking statements herein because of new information, future events or otherwise.
3
Who We Are
$5.3 billion financial holding company headquartered in Abilene, Texas
Group of 12 separate regions
124-year history
Growth markets include 50 mile radius of
the larger cities of Texas
4
Recognitions
KBW Honor Roll – One of thirty-one banks named – April 2014
SNL Financial #7 Best Performing Regional Bank – April 2014
Nifty 50: Bank Director Magazine - #12 – Based on Return on Equity / Average Tangible Equity – January 2014
Sandler O’Neil 2013 Bank & Thrift Small-Cap All Stars – September 2013
American Banker - #14 – Based on three year average Return on Equity – August 2013
ABA Banking Journal - #16 – Top Performing mid-sized banks ($1B - $10B) – May 2013
5
6
What Makes Us Different
One Bank, Twelve Regions Concept
One Bank Consolidation of backroom operations, technology, and
compliance (lower efficiency ratio)
Twelve Regions Regional Presidents run their regions Local Boards – Movers and Shakers of the Community
Keep our regions locally focused Make sure we meet the needs of the community Help us make better loan decisions Help us market the region
7
FFIN’s Unique Positioning in Texas
Bank Key Markets
Comerica, Inc. DFW, Austin, Houston, California, Michigan, Florida, Mexico
Frost San Antonio, Austin, Corpus Christi, DFW, Rio Grande, West Texas
Independent North and Central Texas
International Bancshares Corp. Rio Grande, Houston, San Antonio, Oklahoma
Prosperity Houston, DFW, Austin, West Texas, South Central Texas, and Oklahoma
Southside East Texas
Texas Capital DFW, Austin, San Antonio, and Houston
ViewPoint Financial Dallas
8
Orange Acquisition
Effective May 31, 2013
Orange, Jefferson and Newton Counties Approximately 350,000 Residents Strategically located on Interstate 10 – 100 miles east of Houston Three Major Shipping Ports for Energy and Petrochemical industries Large refineries, natural gas terminals and recent investment from large
Fortune 500 Companies, such as Exxon Mobil, DuPont and Goodyear
$443.8 million in Assets* $386 million in deposits $293.3 million in loans
Approximately 1.3x book; 13x last twelve months earnings (tax effected) Orange acquisition is consistent with our acquisition model of high growth areas
and along the Interstates Provides Diversification #1 Market Share in Orange County – 40%, more than twice the nearest competitor
*As of May 31, 2013
98
10
Texas: Large and Growing
Five most populous states:* Growth (2002 – 2012)
California 38.0 million 8.3%
Texas 26.1 million 19.7%
New York 19.6 million 2.2%
Florida 19.3 million 15.9%
Illinois 12.9 million 2.2%
* U.S. Census Bureau
11
Target Markets – Population Growth
Population growth (2002-2012) in FFIN expansion markets:*
Texas 19.7%
Bridgeport & Wise County 24.6%
Fort Worth & Tarrant County 25.8%
Cleburne & Johnson County 31.8%
Weatherford, Willow Park, Aledo & Parker County 29.6%
Granbury & Hood County 31.8%
Stephenville & Erath County 22.6%
* U.S. Census Bureau
12
Texas Benefits
State unemployment rate at 5.5%, state’s lowest rate
since November 2008
Only Texas and New York have restored all the jobs
lost when recession hit in 2007
CEO Magazine ranks Texas best state for business –
for seventh consecutive year
Texas created more jobs (310,000) during the prior
twelve months, more than any other state
Texas created more private sector jobs than any other
state during the past decade
Core Markets: West Central Texas
Markets served benefiting from well-established, long- time customers
REGIONASSET
SIZE*LOCATIONS
DEPOSIT
MARKET SHARE**
MARKET
SHARE RANK**
First Financial Bank(Abilene, Clyde, Moran, Albany, Odessa)
$1,756 M 15 43% 1
First Financial Bank(Hereford)
$154 M 1 43% 1
First Financial Bank(Eastland, Ranger, Rising Star, Cisco)
$216M 4 58% 1
First Financial Bank(Sweetwater, Roby, Trent, Merkel)
$192 M 4 34% 1
First Financial Bank(San Angelo)
$492M 3 19% 2
TOTALS $2,810M 27* Data as of 03-31-14** Data as of 06-30-13
13
Expansion Markets REGION ASSET SIZE* LOCATIONS
DEPOSIT MARKET
SHARE**
MARKET SHARE
RANK**
First Financial Bank (Cleburne, Burleson, Alvarado, Midlothian, Waxahachie)
$368M 6 20% 1
First Financial Bank
(Southlake, Trophy Club, Keller, Grapevine)
(Bridgeport, Decatur, Boyd)
$380M 4
3
5%
21%
5
1
First Financial Bank (Stephenville, Granbury, Glen Rose, Acton)
$400M 6 21% 2
First Financial Bank(Weatherford, Aledo, Willow Park, Brock, Ft. Worth)
$431M 7 24% 1
First Financial Bank(Mineral Wells)
$256M 1 33% 1
First Financial Bank(Huntsville)
$169M 1 19% 2
First Financial Bank(Orange, Mauriceville, Newton, Port Arthur, Vidor)
$441M 5 41% 1
TOTALS $2,445M 33 * Data as of 03-31-14
** Data as of 06-30-13
14
Recent De Novo Growth Beaumont – Under Construction (Opening in 2014)
Weatherford – I-20 Branch – June 2013
San Angelo: HEB Branch – March 2013
Waxahachie: Branch of Cleburne – December 2012
Abilene: Antilley Road Branch – September 2012
Grapevine: Branch of Southlake – March 2012
Cisco: Branch of Eastland – September 2011
Lamesa: Office of Trust Company – April 2011
Odessa: Branch of Abilene – February 2010
Fort Worth: Branch of Weatherford – February 2010
Odessa: Office of Trust Company – April 2009
Merkel: Branch of Sweetwater – July 2008
Brock: Branch of Weatherford – March 2008
Acton: Branch of Stephenville – March 2008
Albany: Branch of Abilene – May 2007
Fort Worth: Office of Trust Company – April 2007
15
Years with Company Years in Industry
Scott Dueser Chairman of the Board, President & Chief Executive Officer
38 43
J. Bruce Hildebrand, CPA Executive Vice President Chief Financial Officer
11 35
Gary L. Webb Executive Vice President Operations
11 25
Gary S. Gragg Executive Vice President Credit Administration
23 35
Marna Yerigan Executive Vice President Credit Administration
3 30
Ron Butler Executive Vice President Chief Administrative Officer
21 32
Senior Management at First Financial
16
Years with Company Years in Industry
Michele Stevens Senior Vice President Advertising and Marketing
16 32
Courtney Jordan Senior Vice President Training
5 18
Bob Goodner Senior Vice President & Compliance Officer Compliance
12 35
Luke Longhofer Senior Vice President & Loan Review Officer Credit Administration
3 10
Brandon Harris Senior Vice President Appraisal Services
1 15
Kirk Thaxton, CTFA President, First Financial Trust & Asset Management
27 31
Senior Management at First Financial
17
Experienced Regional CEOs & PresidentsYears with Company Years in Industry
Marelyn Shedd, Abilene 23 30
Mike Mauldin, Hereford 11 36
Kirby Andrews, Sweetwater 23 26
Trent Swearengin, Eastland 14 16
Mike Boyd, San Angelo 38 42
Tom O’Neil, Cleburne 15 34
Matt Reynolds, Cleburne 9 31
Ron Mullins, Stephenville 8 35
Jay Gibbs, Weatherford 12 39
Mark Jones, Southlake 13 36
Ken Williamson, Mineral Wells 12 42
Robert Pate, Huntsville 16 33
Fred Wren, Huntsville 2 35
Stephen Lee, Orange 6 20
Gary Tucker, First Technology Services 23 39
18
19
2009 2010 2011 2012 2013 2014
$3,279
$3,776
$4,121
$4,502
$5,222 $5,281Chart Title
Growth in Total Assets
Asset Performance
(in millions)
*As of March 31, 2014
20
2009 2010 2011 2012 2013 2014
$836 $959 $1,102 $1,312 $1,362 $1,389
$1,849$2,154
$2,233$2,321
$2,773 $2,845
Non Interest Bearing Interest Bearing
Deposit Growth
Growth in FFIN Total Deposits (in millions)
$4,234
$2,685
$3,113$3,335
$3,633
$4,135
*As of March 31, 2014
21
Deposit Products
Time16.1% De
mand
32.8%
Money
Market39.9%
Sav-ings11.2%
*As of March 31, 2014
Account Growth
Net Growth in 2011 – 4,036 Accounts
Net Growth in 2012 – 1,219 Accounts
Net Growth in 2013 – 3,308 Accounts*
New Growth in 2014 – 2,600 Accounts
December 31, 2011
December 31, 2012
December 31, 2013*
March 31, 2014
Total Number of Accounts
204,063 205,282 208,590 226,527
22
*(Excluding Orange Acquisition)
2008 2009 2010 2011 2012 2013 2014$77 $73 $81 $66 $68 $76 $65
$191 $175 $191 $218 $273 $333 $336 $52 $0 $0
$391 $406 $429 $427 $510
$596 $599
$855 $860 $990 $1,076
$1,238
$1,684 $1,699
Real Estate
Commercial
Student
Consumer
Agricultural
Loan Performance
Growth in FFIN Total Loans (in millions)
$1,514$1,690
$1,787
$2,089
$1,566
$2,699
23
$2,689
*As of March 31, 2014
24
Overview of Loan Portfolio
Commercial 22.2%
Agricul-ture2.4%
Consumer12.4%
Real Es-tate
63.0%
*As of March 31, 2014
Residential Development & Construction 6.7%
1-4 Family 46.9%
Commercial Development and Construc-tion
2.7%
Commercial R/E 30.1%
Other R/E 13.6%
Chart Title
25
Breakdown of R/E Loan Portfolio
*As of March 31, 2014
26
2008 2009 2010 2011 2012 2013 2014
End of Period 60.6 56.4 54.3 53.6 57.5 65.0 63.7
Average
Balances61.1 59.5 56.0 54.6 56.4 64.3 64.9
Loan to Deposit Ratio
*As of March 31, 2014
27
Less than
1 year
1 to 3
years
3 to 5
years
5 to 10
years
10 to 15
years
Over 15
years
33.2% 5.5% 5.1% 16.3% 18.9% 12.1% 8.9%
Variable and Fixed Rate Loans
Loan Portfolio Interest Rate Risk Analysis
Variable
RateFixed Rate
*As of March 31, 2014
2009 2010 2011 2012 2013 2014
FirstFinancial 1.46% 1.53% 1.64% 1.22% 1.16% 1.02%
Peer Group 5.41% 5.37% 4.59% 3.67% 2.72% -
Sound Lending Practices
Nonperforming assets as a percentage of loans + foreclosed assets (FFIN vs. Peers)
28
*As of March 31, 2014
29
2008 2009 2010 2011 2012 2013 2014
$21,529
$27,612
$31,106
$34,315 $34,839 $33,900 $34,693*
$7,957
$11,419$8,962
$6,626
$3,484 $3,753$1,690
ALLL Provision
Allowance for Loan Losses and Provision for Loan Losses
(in thousands)
*As of March 31, 2014
Summary of Bond Portfolio
Agencies 6.35%Corporates 4.29%
Muni 48.30%
MBSs 17.74%
CMOs 23.32%
30
*As of March 31, 2014
Municipal Allocation by State State Percentage
Texas 71.35%
Michigan 2.66%
Wisconsin 2.46%
Illinois 2.19%
Washington 2.18%
Massachusetts 1.44%
New Jersey 1.40%
Florida 1.32%
Ohio 1.20%
Louisiana 1.14%
Utah 1.14%
Kentucky 1.07%
Other 38 states 10.45%
31
*As of March 31, 2014
32
2009 2010 2011 2012 2013 2014
$1,664$1,784
$1,912
$2,232
$2,465$2,552
Chart Title
Growth in Trust Assets
Total Trust Assets – Book Value (in millions)
*As of March 31, 2014
33
2009 2010 2011 2012 2013 2014
$9,083
$10,808
$12,671
$14,464
$16,317
$2,117 $2,526 $3,044 $3,454 $3,793
$4,576
thru March 31st
Total Trust Fees
Growth in FFTAM Fees (Full year and 1st 3 months) (in thousands)
2009 2010 2011 2012 2013 2014
$53.8$59.7
$68.4
$74.2$78.9
$13.7 $13.7$16.3 $17.8 $18.6
$22.3
27th Consecutive Year of Increased Earnings
FFIN Earnings (Full year and 1st 3 months) (in millions)
34
thru March 31st
35
2009 2010 2011 2012 2013 2014
$0.86$0.95
$1.09$1.18
$1.24
$0.22 $0.22 $0.26 $0.28 $0.29 $0.35
Strong Shareholder Earnings
Basic Earnings Per Share (Full year and 1st 3 months)
thru March 31st
*Per share amounts reflect the 2 for 1 stock split that was announced April 22, 2014 for shareholders of record as of May 15, 2014, with distribution on June 2, 2014.
2007 2008 2009 2010 2011 2012 2013
1.72% 1.74% 1.72% 1.75% 1.78% 1.75%1.64%
0.87%
-0.03%
-0.18%
0.24%
0.79%
0.98% 1.05%
FFIN Outperforms Peers
Percentage Return on Average Assets
Pe
er
Gro
up
Fir
st
Fin
an
cia
l
36
2007 2008 2009 2010 2011 2012 2013
15.87%15.27%
13.63% 13.74%14.44%
13.85% 13.75%
9.45%
-1.83%-2.57%
0.88%
7.27%8.56% 8.99%
Strong Return on Capital
Percentage Return on Average EquityP
ee
r G
rou
p
Fir
st
Fin
an
cia
l
37
38
2010 2011 2012 2013 2014
Shareholders’Equity 441,688 508,537 556,963 587,647 616,566
As a Percent of Total
Assets11.70 12.34 12.37 11.25 11.68
Tangible
Capital369,164 436,415 484,990 490,163 519,084
Tier 1
Leverage Ratio10.28 10.33 10.60 9.84 9.95
Tier 1 Risk
Based Capital Ratio17.01 17.49 17.43 15.82 16.24
Risk Based
Capital Ratio18.26 18.74 18.68 16.92 17.39
Capital & Capital Ratios
(dollars in thousands)
*As of March 31, 2014
4th Qtr. '10
1st Qtr. '11
2nd Qtr. '11
3rd Qtr. '11
4th Qtr. '11
1st Qtr. '12
2nd Qtr. '12
3rd Qtr. '12
4th Qtr. '12
1st Qtr. '13
2nd Qtr. '13
3rd Qtr. '13
4th Qtr. '13
1st Qtr. '14
3.00%
3.25%
3.50%
3.75%
4.00%
4.25%
4.50%
4.75%
5.00%
First Financial Peer Group
Net Interest Margin
Quarterly Interest Margin
39
2008 2009 2010 2011 2012 2013 2014
FirstFinancial 50.76% 50.11% 49.49% 48.37% 48.14% 50.19% 47.57%
Peer Group 68.12% 69.53% 67.33% 65.57% 65.77% 67.39% -
Working Harder and Smarter
Efficiency Ratio (FFIN vs. Peers)
40
*As of March 31, 2014
Stock cost in January 2013 $39,010
Dividend declared ($1.03 x 1,000 shares) $ 1,030
Increase in stock price during 2013($66.11 from $39.01 X 1,000 shares) $2210,720
2013 return on investment 72.11%
2012 return on investment 19.65%
2011 return on investment 0.61%
2010 return on investment -2.99%
2009 return on investment 0.69%
5 year compound average return 14.01%
Total Return on Investment
$27,100
Assume you owned 1,000 shares of FFIN stock on January 1, 2013…
41
Dividends Per Share
2007 2008 2009 2010 2011 2012 2013
$0.42$0.45 $0.45 $0.46
$0.48 $0.50$0.52
Chart Title
Annual Dividends Declared Per Share*
42
*Dividend amounts reflect the 2 for 1 stock split that was announced April 22, 2014 for shareholders of record as of May 15, 2014, with distribution on June 2, 2014.
Strong Stock Performance
-100.00%
-50.00%
0.00%
50.00%
100.00%
150.00%
FFIN S&P 500 NASDAQ Dow JonesJan . ‘07 Mar. ’14Dec . ‘09Dec ‘07 Dec ‘08 Dec. ‘10 Dec. ’11 Dec. ’12
43
Challenges
Regulatory reform from Washington
Stagnant national economy
Inept federal government
Low interest rate environment
Maintaining net interest margin
Keep nonperforming assets to a minimum
44
Opportunities
Loan Growth
Mortgage Lending
Trust Services
Treasury Management
Mobile Banking
Lower Efficiency Ratio
Potential Acquisitions
45
www.ffin.com