First Community Bankshares, Inc. · NASDAQ:FCBC
First Community Bankshares — Merger or Acquisition (September 2019)
16 slides from First Community Bankshares's merger presentation, Sep 11, 2019
Slide 1: First Community Bankshares and Highlands Bankshares
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Slide 2: Compliance Disclosures: Important Information for Shareholders
Compliance Disclosures Ceri, Important Information for Shareholders This presentation shall not constitute an offer to sel, the solicitation of an offer to sel, or the solicitation ofan offer to buy any securities or the solicitation of any vote or approval, nor shall there be any sale of securities
Slide 3: Legal Disclaimer: Forward-Looking Statements
Legal Disclaimer Bankshares? Inc Forward-Looking Statements Certain ofthe statements made in this presentation may constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Secures Exchange Act of 1934, as amended. Such
Slide 4: Enhancing the Franchise
Rerirse, Enhancing the Franchise Community, Community Banking * The proposed acquisition of Highlands Bankshares, Inc. (‘HLND") by First Community Bankshares, Inc. (‘FCBC’) creates a $2.8 billion asset banking franchise * Continues the Interstate |-81 Corridor footprint from the Tri-Cities in Tennes
Slide 5: Combined Franchise
Rrirst. r ‘ Communi Combined Franchise Bankshares ine, ws edenere 4 on nna FCBC HLND HLND LPO Pro Forma Deposits by State Assets $2,824 TH Loans $2,173 Deposits $2,366 Branches
Slide 6: Financially Attractive for Both Shareholder Bases
First. Financially Attractive for Both Shareholder Bases Community, First. . Community @ highlands Bankshares, Inc. = $22 billion asset bank holding company ~ Headquartered in Bluefield, VA ~ Roots dating back to 1874 = NASDAQ traded under ticker "FCBC" + Consistent, quality earnings growth ‘and mom
Slide 7: Transaction Terms
First . Communit Transaction Terms Bankshares ne, | | FCBC acquires 100% of HLND outstanding common and preferred stock = Fixed exchange ratio of 0.2703 shares of FCBC common stock for each = 100% Stock Consideration share of HLND common and preferred stock’ Total merger value of $91.0 million, or $
Slide 8: Transaction Rationale
First . Communi Transaction Rationale Bankshares ine, + Improves footprintand connectivity in Highlands regional markets across southwest Virginia, northwest North Carolina, and eastern Tennessee * Consolidating similar markets where traditional community bankingis most effective and profitable * ~9
Slide 9: Key Transaction Assumptions
First r 3 Communi Key Transaction Assumptions Bankshares ine, 36% of HLND’s annual Noninterest Expense base - 100% realizedin 2020 Approximately $5.7 million in combined after-tax merger expenses = Total gross loan fair value mark of $15.0 million (3.32% of total loans as of the quarter ended June 3
Slide 10: Extensive Due Diligence Completed
CORE iy Extensive Due Diligence Completed Bankshares, Inc. «In-depth credit due diligence, using experienced in-house professionals - Reviewed 35% of entire portfolio and 66% of watch list loans * 27% of 1-4 family credits * 38% of commercial real estate + 52% of A/R, Inventory, Equipment (C&l) + Ac
Slide 11: Overview of Highlands Bankshares, Inc.
: Community Overview of Highlands Bankshares, Inc. Bankshares, Inc. General Corporate Information Financial Highlights = Holding Company for Highlands Union i I I I ood um Bank atone Set 500) TolaAeas ee — Bank founded in 1985 ‘TotalNat Loans | BQ 508 2K 4013 e210 Pade re ee ee ee veiaeuty ee ee ee
Slide 12: Pro Forma Deposit Market Share
Pro Forma Deposit Market Share Reins, Community Bankshares, Inc. Combined Counties of Operations Mariet wunborot Total Depoats ani Insitvton ‘Sore _Borenes 00) 2 om M8 2 WetaFre ca 04) on og 8 eekotamesacar to) ™ oF 2 2 Fee Gmcopine om 8 1 CWBnensesne om 1 luni Commer Bncoplne om 6 17 cwtertnk st om
Slide 13: Pro Forma Loan & Deposit Composition
Pro Forma Loan & Deposit Composition First. Community Bankshares, Inc. a oe Total Loans: $1,720,744 Total Loans: $453,124 Pro Forma Sg ome itd < Total Loans: $2,173,868 Average Loan Yield: 5.28% ‘Average Loan Yield: 5.09% Yield Loan Yield: 5.24% Togs umboed “nba 60 oe etalco 25% Transacton sm os & E
Slide 14: Future Direction & Vision
Rrirst. . r _ Communi Future Direction & Vision Bankshares ine, = Continue developing and nurturing mutually beneficial relationships with customers, shareholders, and employees — Customers = Competitive Deposit and Loan Products = Delivery of Professional Service = Wealth Management = Insurance Ser
Slide 15: Summary
Rrirst. Communit Summary Bankshares ine, = Consolidates and logically expands the franchise into attractive markets with familiar characteristics = Complements commitment to traditional community banking and the value proposition of our markets = Further strengthens the Company’s community banking f
Slide 16: Community
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