Franklin Financial Services Corporation · NASDAQ:FRAF
Franklin Financial Services — Q4 2024 Earnings Presentation
34 slides from Franklin Financial Services's earnings presentation, Feb 25, 2025
Slide 1: Investor Presentation Fourth Quarter 2024 Highlights
Investor Presentation Fourth Quarter 2024 Highlights F&M TRUST Franklin Financial Services Corporation
Slide 2: Forward Looking Statements
Forward Looking Statements Certain statements appearing herein which are not historical in nature are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements refer to a future period or periods, reflecting management’s cu
Slide 3: CEO Comments
CEO Comments \ We have just finished our second straight year of outstanding loan and deposit growth while at the same time maintaining a strong balance sheet. Coupled with strong non-interest income, led by our wealth management division, we have been able to continue to invest in ourselves by putt
Slide 4: Why Invest in Franklin Financial?
Why Invest in Franklin Financial? A premier, $2.2 billion, bank franchise located in South-Central Pennsylvania and northern tier of Maryland A company that is focused on building shareholder value by investing in technology and infrastructure to position itself for growth and profitability improvem
Slide 5: Mission, Vision & Core Values
Mission, Vision & Core Values Mission Statement Delivering the right financial solutions from people you know and trust. Vision We are committed to remaining independent by growing our bank to meet the increasing needs of our employees, customers, communities, and shareholders. We strive to be a fin
Slide 6: Overview of Franklin Financial
Overview of Franklin Financial Franklin Financial, which was formed in 1983, is a holding company headquartered in Franklin County, PA Franklin Financial’s wholly-owned subsidiary, F&M Trust, was founded in Chambersburg, PA in 1906 Total assets of the Company were $2.2 billion as of December 31, 202
Slide 7: Trade Area Expansion Locations
Trade Area Expansion 23 Locations Serving South Central PA and Washington County MD Primary Trade Area Expanded Trade Area Offering Wealth Management, Commercial Financing, and Residential Lending Services. F&M TRUST Franklin Financial Services Corporation 7
Slide 8: Experienced and Cohesive Executive Team
Experienced and Cohesive Executive Team Executive Title Years of Banking Experience Joined F&M Trust Prior Experience Timothy G. Henry* Chief Executive Officer 43 2016 Fulton, Centra Bank, BlueRidge Bank, Susquehanna Bank, BB&T Craig W. Best President 42 2025 Peoples Security Bank & Trust, First Com
Slide 9: Experienced and Cohesive Executive Team
Experienced and Cohesive Executive Team Executive Title Years of Banking Experience Joined F&M Trust Prior Experience Louis J. Giustini Senior Vice President, Chief Retail Services Officer 37 2022 Hagerstown Trust, Columbia Bank, Fulton Bank Karen K. Carmack, DM Senior Vice President, Chief Human Re
Slide 10: A Year of Growth
A Year of Growth SELECTED HIGHLIGHTS KEY STATISTICS Total Assets $2.198 Billion as of 12/31/2024 $1.836 Billion as of 12/31/2023 Net Loans $1.380 Billion as of 12/31/2024 $1.241 Billion as of 12/31/2023 Total Deposits $1.816 Billion as of 12/31/2024 $1.538 Billion as of 12/31/2023 Assets Under Manag
Slide 11: Income Growth: Net Interest Income
Income Growth Net Interest Income ($000’s) $60,000 $50,000 $40,000 $30,000 $20,000 4% $10,000 2.97% 2.95% 2.92% 2.95% 3% $0 $14,652 $42,418 $15,096 $57,514 2% 9/30/2024 9/30/2024 12/31/2024 12/31/2024 1% Quarter End Year-to-Date Quarter End Year-to-Date 0% Net Interest Income Net Interest Margin F&M
Slide 12: Income Growth: Non-Interest Income
Income Growth Non-Interest Income1 ($000’s) 20000 18000 16000 14000 12000 10000 8000 $1,338 $3,142 $974 $4,116 6000 $597 $1,703 $576 $2,279 4000 $628 $1,813 $635 $2,448 2000 $193 $367 $198 $565 0 $2,097 $6,366 $2,172 $8,538 9/30/2024 9/30/2024 12/31/2024 12/31/2024 Quarter End Year-to-Date Quarter E
Slide 13: Outlook
Outlook The Company is continuing to grow by leveraging past investments in human capital and our physical, technological, and sales infrastructure including: Integration of Salesforce into sales, operations, and marketing Expanding our presence in the Pennsylvania and Maryland markets Expanding the
Slide 14: Outlook
Outlook Deposit balances should continue to grow subject to the bank’s efforts to control interest expense and manage liquidity needs Market pressure on deposit rates and competition for high-quality lending relationships may have an adverse effect on NIM The negative effect of the Accumulated Other
Slide 15: Summary
Summary The Company continues to be well capitalized and sufficiently liquid to successfully continue to grow Asset quality is good, and the Company is well provisioned for loan losses should they occur in future quarters due to economic factors The Company is actively working to bring more digitall
Slide 16: Financial Updates Fourth Quarter Ended December 31, 2024
Financial Updates Fourth Quarter Ended December 31, 2024 F&M TRUST Franklin Financial Services Corporation 16
Slide 17: Balance Sheet Highlights
Balance Sheet Highlights Dollars in Thousands (000’s) 12/31/2024 9/30/2024 12/31/2023 12/31/2022 Total Assets $2,197,841 $2,151,363 $1,836,039 $1,699,579 Cash and Cash Equiv. $203,613 $236,317 $23,140 $64,899 Investments AFS $508,770 $466,485 $472,503 $487,247 Net Loans $1,380,424 $1,348,386 $1,240,
Slide 18: Investment AFS Portfolio
Investment AFS Portfolio $600,000 $500,000 $400,000 $65,950 $104,005 $106,052 $149,170 $300,000 $150,935 $132,591 $120,702 $169,821 $200,000 $24,239 $23,198 $24,321 $24,224 $100,000 $155,455 $138,618 $139,722 $133,592 $0 $90,257 ($61,497) $74,091 ($46,416) $75,688 ($36,688) $31,797 ($45,449) 12/31/2
Slide 19: Diversified Loan Portfolio
Diversified Loan Portfolio Loans Outstanding1 $1,600,000 $1,400,000 $1,200,000 $1,000,000 $37,486 $35,373 $34,825 $35,086 $800,000 $113,629 $160,612 $207,219 $239,559 $600,000 $118,443 $115,018 $111,410 $108,545 $400,000 $218,468 4.14% $275,216 5.16% $315,373 5.61% $322,366 5.65% $200,000 $106,921 $
Slide 20: Largest Commercial Real Estate Concentrations
Largest Commercial Real Estate Concentrations CRE Concentrations $600,000 $500,000 $400,000 $43,812 $62,439 $63,627 $66,645 $300,000 $55,428 $68,478 $76,027 $82,518 $200,000 $58,382 $87,137 $92,396 $92,926 $100,000 $81,283 $80,670 $100,519 $97,460 $0 $96,515 $120,180 $141,879 $146,661 12/31/2022 12/
Slide 21: Strong Credit Quality
Strong Credit Quality Nonperforming Assets1 / Assets (%) 0.20% 0.15% 0.10% 0.05% 0.00% 0.01% 0.01% 0.02% 0.01% 12/31/2022 12/31/2023 9/30/2024 12/31/2024 1Nonperforming assets = nonaccrual loans, loans 90 days past due and other real estate owned F&M TRUST Franklin Financial Services Corporation 21
Slide 22: Deposits by Category
Deposits by Category Deposits by Category $1,800,000 $1,600,000 $1,400,000 $1,200,000 $1,000,000 $800,000 $600,000 $57,390 $132,446 $243,727 $315,905 $400,000 $496,532 $454,517 $418,837 $417,870 $200,000 $698,295 8.50% $677,965 8.90% $758,172 11.90% $791,526 15.40% $0 $299,231 $273,050 $8,677 $303,2
Slide 23: Cost of Deposits
Cost of Deposits Cost of Deposits1 (%) 2.00 1.80 1.60 1.40 1.20 1.00 0.80 0.60 0.40 0.20 0.00 0.12 0.23 1.23 1.89 2021 2022 2023 2024 1Year-to-date F&M TRUST Franklin Financial Services Corporation 23
Slide 24: Liquidity Available at December 31, 2024
Liquidity Available at December 31, 2024 Dollars in Thousands (000’s) Liquidity Source Capacity Outstanding Available Federal Home Loan Bank $562,697 $ 200,000 $362,697 Federal Reserve Bank Discount Window $64,575 $ – $64,575 Correspondent Banks $76,000 $ – $76,000 Total $703,272 $200,000 $503,272 F
Slide 25: Wealth Management Total and New Assets Under Management
Wealth Management Total and New Assets Under Management ($000’s) -$200,000 -$400,000 -$600,000 -$800,000 -$1,000,000 -$1,200,000 -$1,400,000 -$1,600,000 $135,423 $1,094,779 $1,230,202 $217,891 $144,168 $1,176,897 $1,321,066 $83,175 $139,872 $1,169,290 $1,309,162 $109,604 12/31/2023 9/30/2024 12/31/2
Slide 26: Income Statement Highlights
Income Statement Highlights Dollars in Thousands (000’s) Quarter Ended 12/31/2024 Quarter Ended 9/30/2024 Quarter Ended 12/31/2023 Interest Income $26,856 $26,053 $21,516 Interest Expense $11,760 $11,401 $7,616 Provision for Credit Losses $500 $485 $788 Noninterest Income1 $4,574 $4,550 $4,044 Nonin
Slide 27: Key Performance Measures
Key Performance Measures Percent (%) Quarter Ended 12/31/2024 Quarter Ended 9/30/2024 Quarter Ended 12/31/2023 Return on Average Assets (ROAA) 0.09 0.80 0.75 ROAA excluding securities losses, net of tax benefit (non-GAAP)1 0.71 0.80 0.75 Return on Average Equity (ROAE) 1.32 11.86 11.81 ROAE excludin
Slide 28: Balance Sheet Strength
Balance Sheet Strength Percent (%) Quarter Ended 12/31/2024 Quarter Ended 9/30/2024 Quarter Ended 12/31/2023 Risk-Based Capital Ratio (Total) 13.85 14.73 14.45 Leverage Ratio (Tier 1) 7.92 8.44 9.01 Common Equity Ratio (Tier 1) 11.31 12.08 11.82 Tangible Common Equity Ratio 6.20 6.58 6.74 Tangible C
Slide 29: Market Statistics
Market Statistics Per Share Measure / Market Valuation Quarter Ended 12/31/2024 Quarter Ended 9/30/2024 Quarter Ended 12/31/2023 Diluted Earnings Per Share $0.11 $0.95 $0.79 Cash Dividend Yield 4.28% 4.25% 4.06% Regular Cash Dividends Paid $0.32 $0.32 $0.32 Dividend Payout Ratio 290.14% 33.45% 40.23
Slide 30: Stock Symbol: FRAF (Nasdaq)
Stock Symbol: FRAF (Nasdaq) www.franklinfin.com www.fmtrust.bank F&M TRUST Franklin Financial Services Corporation 30
Slide 31: Appendix
Appendix F&M TRUST Franklin Financial Services Corporation 31
Slide 32: GAAP / Non-GAAP Reconciliation: Tangible Book Value
GAAP / Non-GAAP Reconciliation Tangible Book Value (per share) (non-GAAP) Quarter Ended 12/31/2024 Quarter Ended 9/30/2024 Quarter Ended 12/31/2023 Shareholders’ equity $ 144,716 $ 149,928 $ 132,136 Less intangible assets (9,016) (9,016) (9,016) Shareholders’ equity (non-GAAP) 135,700 140,912 123,12
Slide 33: GAAP / Non-GAAP Reconciliation: Net Income Excluding Securities Losses
GAAP / Non-GAAP Reconciliation Net Income Excluding Securities Losses (non-GAAP) Quarter Ended 12/31/2024 Quarter Ended 9/30/2024 Quarter Ended 12/31/2023 Securities losses as reported $ (4,267) $ – $ – Securities losses as reported, net of tax benefit (non-GAAP) (3,371) – – Noninterest income as re
Slide 34: GAAP / Non-GAAP Reconciliation: Efficiency Ratio
GAAP / Non-GAAP Reconciliation Efficiency Ratio Quarter Ended 12/31/2024 Quarter Ended 9/30/2024 Quarter Ended 12/31/2023 Noninterest expense $ 14,335 $ 13,917 $ 13,148 Net interest income 15,096 14,652 13,900 Plus tax equivalent adjustment to net interest income 227 248 261 Plus noninterest income,
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