Farmers National Banc Corp. · NASDAQ:FMNB
Farmers National Banc — Q1 2023 Earnings Presentation
20 slides from Farmers National Banc's earnings presentation, Apr 26, 2023
Slide 1: Q1 2023 Earnings
NASDAQ: FMNB Q1 2023 EARNINGS Exhibit 99.2
Slide 2: Disclosure Statement: Forward-Looking Statements
Disclosure Statement Forward-Looking Statements This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements about the financial condition, results of operations, asset quality trends and profitability of Farm
Slide 3: About Farmers National Banc Corp.
$5.1 billion in banking assets $3.1 billion in wealth management assets under care $0.68 (6.1%) annualized dividend yield* Named a Best Employer in Ohio the past 2 years** Founded in 1887 161 consecutive quarters of profitability Strong and diverse franchise currently operating 65 banking locations
Slide 4: Management team
Kevin Helmick (50) President & Chief Executive Officer Troy Adair (56) Senior Executive Vice President, Chief Financial Officer Tim Carney (57) Senior Executive Vice President, Chief Banking Officer Jim Gasior (62) Senior Executive Vice President, Corporate Development Officer Amber Wallace (56) Sen
Slide 5: Farmers Strategic Vision
Leverage technology Drive efficiencies through Six Sigma operating framework Strive to be customer centric and provide exceptional experiences Assure Farmers is the best place to work Continued pursuit of organic and M&A opportunities Strive for performance metrics in top quartile ranking vs. peer g
Slide 6: Proven Acquisition History and Strategy
Graph in millions As of June 30, 2020 Farmers Trust Company (2009) Farmers National Insurance (2008) Private Client Services (2012) National Associates (2013) National Bancshares (2015) Bowers Insurance (2016) Tri-state 1st Banc (2015) Monitor Bancorp (2017) Maple Leaf (2020) Cortland Bancorp (2021)
Slide 7: Balance Sheet Strengths
(1) (1) 3/31/23 12/31/22 Improved Customer Deposits** $4.3 billion* $3.4 billion ü Cash Balances $128.0 million $75.6 million ü Loan-to-Deposit Ratio 71.7% 67.5% ü AOCI ($176.7 million) ($210.5 million) ü Nonperforming Loans to Total Loans 0.57% 0.62% ü Allowance to Nonperforming Loans 200.5% 182.3%
Slide 8: Core Results Overview
Record core net income in 2022 Core EPS remains strong remains strong through challenging environments Core items exclude the impact of acquisition related provision and other items. See Non-GAAP reconciliation in appendix. Core Results 8 Overview Core Net Income Core Return on Assets Core EPS
Slide 9: Loan Portfolio Overview
Total loans $3.2 billion Diverse loan mix Farmers’ practice is to lend primarily within its market area Only 3.6% of loan portfolio is participations purchased Loan Portfolio Overview Overview Rate Type Segments Net Loans to Assets Total Loans (in millions) 9
Slide 10: CRE Breakdown
Category Balance % of CRE % of Total Loans Retail $ 264,605 21% 8% Office $ 149,668 12% 5% Warehouse/Industrial $ 130,314 10% 4% Multifamily $ 108,740 8% 3% Medical $ 100,470 8% 3% Hotel $ 73,816 6% 2% Special Purpose $ 69,092 5% 2% Restaurant $ 45,778 4% 1% Multifamily - Construction $ 32,866 3% 1%
Slide 11: Asset Quality Trends
Early-stage delinquencies were $10.2 million, or 0.32% of total loans at March 31, 2023, compared to $9.6 million, or 0.40% of total loans at December 31, 2022 Conservative underwriting practices Sound reserve levels under CECL Asset Quality Trends Annualized Net Charge-Offs to Avg. Net Loans Overvi
Slide 12: Securities Portfolio Overview
All of the Investment securities portfolio is categorized as available for sale All MBS and CMOs are U.S. government agency issued All municipal securities are investment grade, many with credit enhancements The duration of the available for sale securities portfolio is 7.3 year at March 31, 2023 As
Slide 13: Deposit Trends
We are proud to say our bank is built on core deposits Total deposits: $4.39 billion Noninterest-bearing stood at 25.2% of total deposits Uninsured deposits are approximately 19.2% of customer deposit base 8.6% of consumer deposits are uninsured 30.3% of business deposits are uninsured March 2023 Fe
Slide 14: Liquidity
Farmers National Bank has the following sources of liquidity as of March 31, 2023: $118.0 million of cash and equivalents $656.1 million of additional borrowing capacity at the FHLB $35.0 million of unsecured lines of credit with a zero balance $138.5 million of investment securities that could be s
Slide 15: Net Interest Income and NIM Trends
Focused on growing loans to manage net interest margin Managing cost of funds and deposit betas through rising rate environment Net Interest Income (in thousands) Overview Net Interest Margin (annualized) Loans to Deposits 15 Net Interest Income and NIM Trends
Slide 16: Noninterest Income Trends
Robust Trust, Wealth Management and Insurance businesses Diverse revenue sources Working to increase noninterest income to total revenue *Noninterest income in 2022 excludes $8.4 million in income related to the proceeds of a one-time legal settlement. See Non-GAAP reconciliation in appendix. Total
Slide 17: Noninterest Expense Trends
Overall focus on driving efficiencies The Company recently added the position of Chief Operating Officer who will spearhead process improvement efforts Track record of prudent expense management (1) Both ratios adjusted for certain items. See Non-GAAP reconciliation in appendix. 1) (2) All periods a
Slide 18: Capital
All regulatory capital ratios above well-capitalized threshold Announced 1,000,000 share repurchase program in Q1 2023 Strong dividend payout Tangible Equity to Tangible Assets Overview Total Risk Based Capital Tier 1 Leverage Ratio 18 Capital * Estimated
Slide 19: Appendix – Non GAAP Reconciliations
Appendix – Non GAAP Reconciliations 19
Slide 20: Appendix – Non GAAP Reconciliations
Appendix – Non GAAP Reconciliations 20
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