2015 Annual Meeting May 5, 2015 Aspire to be a top performing - PowerPoint PPT Presentation

2015 Annual Meeting May 5, 2015

Aspire to be a top ‐ performing regional bank, delivering well for all stakeholders Colleagues Offer fulfilling jobs Investors Regulators Deliver Comply with Customers C t strong value letter and Serve our proposition spirit of rules customers well and and attractive attractive regulations regulations returns Communities & Society S Support sustainable prosperity t t i bl it C Customer ‐ centric culture i l 1

Getting to top performing We have a clear plan with specific objectives for each stakeholder We have a clear plan with specific objectives for each stakeholder  Achieve current targets, then raise the bar Investors Investors  Strive for consistency in performance, limit tail risk Strive for consistency in performance, limit tail risk  Target relatively high pay ‐ out ratio, steady and growing dividend  Continue to improve customer satisfaction ─ Top 10 in JD Power for Consumer segment Top 10 in JD Power for Consumer segment Customers ─ Top performer in RM quality, value of ideas in Commercial  Gain market share in targeted segments (Consumer & Commercial)  Achieve top quartile Organizational Health rating A hi il O i i l H l h i Colleagues  Continue to develop talent and enhance culture  Achieve heightened volunteer and financial giving aspirations Community Community  Use our position to improve the well ‐ being of the communities we serve  Achieve and sustain heightened standards across broad regulatory Regulators agenda, and earn the respect of our regulators 2

Our vision and strategy O Our objective is to be a top ‐ performing regional bank that delivers well for our stakeholders bj ti i t b t f i i l b k th t d li ll f t k h ld Our vision is to deliver the best possible banking experience Our strategy to achieve this is to :  Offer our customers a differentiated customer experience through the quality of our colleagues, products and services – Foster a culture around customer ‐ centricity, commitment to excellence, leadership, teamwork and integrity teamwork and integrity  Build a great brand that invokes trust from our customers and reinforces our value proposition – Consumer: Simple. Clear. Personal. – Commercial: Thought Leadership Commercial: Thought Leadership  Strive to deliver attractive risk ‐ adjusted returns by making good capital and resource allocation decisions, being good stewards of our resources, and rigorously evaluating our execution  Operate with a strong balance sheet with regards to capital, liquidity and funding, coupled with a well ‐ defined and prudent risk appetite  Maintain a balanced business mix between Commercial Banking and Consumer Banking  Position the bank as a ‘community leader’ that makes a positive impact on the communities and local economies we serve 3

These strategies have been mapped to specific initiatives Improved Balance Sheet Growth/ Continued Commercial Consumer Capital Mix Momentum Bank Normalization  Reenergize Household growth  Build out Mid ‐ Corporate &  Target 7 – 8% loan growth Specialty verticals  Grow Auto  Complete $500 million  Continued development of remaining capital conversion  Grow Education Finance transactions (1) Capital Markets  Expand Business Banking  Build out Treasury Solutions  Build out Treasury Solutions  Expand Mortgage sales force d l f  Grow Franchise Finance  Expand Wealth sales force  Core Commercial growth Embed Robust Enhanced Efficiency & High ‐ Performing, Risk/Regulatory Infrastructure Customer ‐ Centric Culture Framework  Target $200 million expense $  CCAR progress: received non ‐  New Vision & Credo savings by end of 2016 objection on 2015 submission  Organization Health Index /  Continue significant  Regulatory issue remediation Leadership standards technology investment 4 1) Subject to regulatory approval.

Key to execution is the quality of our talent and instilling the right culture People Culture  To achieve this we need to continue to hire,  Culture is focused on: develop, and retain the right talent ─ Customer  Focused on strengthening the leadership of the ─ Leadership organization ─ Accountability and execution ─ Over 18 months have attracted or promoted from within 24 new members to t d f ithi 24 b t ─ Community focus our Executive Leadership Group (top 120)  Building alignment and capability in our leadership leadership Execution: Intense focus delivering against the plan  Identified and communicated priority initiatives  Identified and communicated priority initiatives  Monitoring metrics regularly (vs  Monitoring metrics regularly (vs. targets)  Assigned ownership  Aligned resources  Maintaining flexibility to adapt based on progress and environment  Mapped out metrics and targets for each initiative 5

We are led by a strong and experienced Board & Leadership Team Leadership Team Member Title Board Member Committees Bruce Van Saun Chairman and Chief Executive Officer Bruce Van Saun Chairman and Chief Executive Officer Eric Aboaf Chief Financial Officer Lead Director; Chair of Compensation and Human Resources Committee; Member of Arthur F. Ryan Vice Chairman and Head of Citizens Nominating and Corporate Governance David Bowerman Business Services Business Services Committee Committee Vice Chairman and Head of Consumer Mark Casady Member of Risk Committee Brad Conner Banking Member of Audit Committee; Nominating and Anthony Di Iorio Corporate Governance Committee EVP and Head of Distribution Consumer Michael Cleary Banking Banking Robert Gillespie Robert Gillespie EVP, General Counsel and Chief Legal Member of Audit Committee; Compensation Stephen Gannon William P. Hankowsky Officer and Human Resources Committee Beth Johnson EVP and Head of Corporate Strategy Member of Audit Committee; Nominating and Howard W. Hanna III Corporate Governance Committee Corporate Governance Committee Susan LaMonica Susan LaMonica EVP and Director of Human Resources EVP and Director of Human Resources Vice Chairman and Head of Commercial Member of Audit Committee; Compensation Don McCree Lee Higdon Banking, effective Sep 1, 2015 and Human Resources Committee Robert Nelson EVP and Chief Compliance Officer Chair of Risk Committee; Member of Audit Charles J. (“Bud”) Koch EVP and Regional Director Technology Committee Brian O’Connell Brian O Connell Services Chair of Nominating and Corporate EVP and Interim Co ‐ Head of Shivan S. Subramaniam Governance Committee; Member of Risk Robert Rubino Commercial Banking Committee Nancy Shanik EVP and Chief Risk Officer Chair of Audit Committee; Wendy A. Watson y Member of Risk Committee; Compensation ; p EVP and Interim Co Head of EVP and Interim Co ‐ Head of Stephen Woods and Human Resources Committee Commercial Banking Marita Zuraitis Member of Risk Committee Average industry experience of 26 years 6

We have targeted a 10%+ run ‐ rate ROTCE by the end of 2016 End 2016 Key Indicators 2011 2013 (1) 2014 4Q14 Targets Targets Return on average tangible 4.2% 4.9% 6.7% 6.1% common equity ("ROTCE") (3) 10%+ Adjusted ROTCE (3)(4) Adjusted ROTCE 4.5% 4.5% 5.1% 5.1% 6.1% 6.1% 6.8% 6.8% Adjusted return on average 0.5% 0.6% 0.7% 0.7% 1.0%+ total tangible assets (3)(4) Adjusted efficiency ratio (3)(4) 66% 69% 69% 67% ~60% ~11% (2) Tier 1 common equity ratio 13.3% 13.5% 12.4% 12.4% Making steady progress Note: Financial targets assume that interest rates will evolve consistent with the market implied forward rates based on the yield curve as of February 28 2014, and that macroeconomic and competitive conditions are consistent with those used in our planning assumptions. 1) 2013 excludes $4.4 billion pre ‐ tax ($4.1 billion after ‐ tax) goodwill impairment charge. See appendix for a reconciliation of non ‐ GAAP items. 2) ~11% pro forma Basel III common equity Tier 1 ratio on a fully phased ‐ in basis. 3) Non ‐ GAAP item. See appendix for a reconciliation of non ‐ GAAP items. 7 4) Excludes restructuring charges and special items, as applicable.

Plan spans three years to end of 2016, and tracking well Targets progressed as planned in 2014 Targets progressed as planned in 2014 2014 Operating Plan   Net interest income Net interest income High single digit growth High ‐ single ‐ digit growth  Loan portfolio Mid ‐ single ‐ digit growth  Credit quality 35 ‐ 45 bps of net charge ‐ offs <70% Efficiency ratio 70% Effi i ti Efficiency ratio/  28% of $200 million incremental cost saves Cost saving initiatives completed by end of 2014   Loan ‐ to ‐ deposit ratio p < 100%  ~ 6.0% Adjusted ROTCE (1) (6.8% in 4Q14)   $666 million equity exchange for sub ‐ debt; 2014 completed capital actions (2) p p $334 million sub ‐ debt issued/stock buyback $334 illi b d bt i d/ t k b b k  ~ 120 bps reduction Tier 1 Common Equity ratio Targeting ~11% (3) by end of 2016 1) Non ‐ GAAP item. See appendix for a reconciliation of non ‐ GAAP items. 2) 2014 capital actions represented exchanges between CFG and RBS. 8 3) Pro forma Basel III common equity Tier 1 ratio on a fully phased ‐ in basis.