Slide 1: A Proven History of Shareholder Value Creation – 3rd Quarter 2024
Lakeland Financial Corporation A Proven History of Shareholder Value Creation And Commitment to Our Communities 3rd Quarter 2024 LKFN L I S T E D
Slide 2: Executive contacts
2 David M. Findlay Chairman & Chief Executive Officer david.findlay@lakecitybank.com (574) 267‐9197 Kristin L. Pruitt President kristin.pruitt@lakecitybank.com (574) 371‐9220 Lisa M. O’Neill Executive Vice President & Chief Financial Officer lisa.oneill@lakecitybank.com (574) 267‐9125
Slide 3: Forward-Looking Information
3 Forward‐Looking Information This presentation contains, and future oral and written statements of the Company and its management may contain, forward‐looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward‐looking statements are not historical facts a
Slide 4: Bank Director Magazine – Top U.S. Banks
4 Bank Director Magazine – Top U.S. Banks
Slide 5: Long Term Success for Shareholders
5 Long Term Success for Shareholders LTM ROE >13% Source: S&P Capital IQ Pro. Financial data is as of June 30, 2024. (1) Includes banks and thrifts traded on the NYSE, NYSEAM or NASDAQ as of 10/11/24; excludes merger targets. (2) Defined as having positive net income before extraordinary items and p
Slide 6: Strong Capital Structure
Tangible Common Equity 92.0% Allowance for Credit Losses 8.0% $2 7. 22 $3 2. 42 $0.00 $5.00 $10.00 $15.00 $20.00 $25.00 $30.00 $35.00 19 91 19 93 19 95 19 97 19 99 20 01 20 03 20 05 20 07 20 09 20 11 20 13 20 15 20 17 20 19 20 21 20 23 Tangible Book Value(1) Per Share 6 Strong Capital Structure Key
Slide 7: Lake City Bank Today
7 Lake City Bank Today •A long‐term and consistent organic growth story •Headquartered in Warsaw, Indiana • 54 branch offices ‐ $6.6 billion banking assets ‐ $3.5 billion trust, retirement and investment brokerage assets • Focused on execution – “blocking and tackling” • Continued growth potential
Slide 8: Years of Organic Growth
8 32 Years of Organic Growth Record Net Income for 32 of 35 Years $2 ,7 07 $9 3, 76 7 $0 $20,000 $40,000 $60,000 $80,000 $100,000 $120,000 19 91 19 92 19 93 19 94 19 95 19 96 19 97 19 98 19 99 20 00 20 01 20 02 20 03 20 04 20 05 20 06 20 07 20 08 20 09 20 10 20 11 20 12 20 13 20 14 20 15 20 16 20 17
Slide 9: Established Market Presence
9 Established Market Presence Organic Growth Potential in Mature and Expanding Markets
Slide 10: A Continued Path to Economic Growth
10 A Continued Path to Economic Growth • 67% of Lake City Bank counties are growth and high growth counties • 40% of Lake City Bank counties are high growth counties • Indiana is poised to experience continued economic strength and vitality
Slide 11: Strong Regional and Statewide Economy
8. 4% 7. 2% 5. 7% 4. 2% 4. 1% 3. 7% 3. 4% 3. 0% 7. 5% 3. 3% 2. 9% 3. 6% 4. 2% 8. 4% 7. 3% 5. 9% 4. 5% 4. 4% 4. 0% 3. 6% 3. 2% 7. 2% 4. 0% 3. 2% 3. 5% 4. 4% 8. 2% 7. 3% 6. 3% 5. 2% 5. 0% 4. 5% 3. 9% 3. 8% 8. 5% 5. 3% 3. 8% 3. 9% 4. 4% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0% 2012 August 2013 August 2014 Augus
Slide 12: Lake City Bank Balance Sheet Dynamics
12 Lake City Bank Balance Sheet Dynamics 1. Capital Strength 2. Diversified Deposit Composition 3. Liquidity Availability 4. Investment Securities Portfolio 5. Asset Liability Management
Slide 13: Fortress Balance Sheet And Capital In Excess of Requirements
13 Fortress Balance Sheet And Capital In Excess of Requirements LKFN Above Peer Long‐Term Profitability has Contributed to a Strong Capital Foundation 13.3% 15.5% 8.0% 9.0% 10.0% 11.0% 12.0% 13.0% 14.0% 15.0% 16.0% Q4'10 Q4'11 Q4'12 Q4'13 Q4'14 Q4'15 Q4'16 Q4'17 Q4'18 Q4'19 Q4'20 Q4'21 Q4'22 Q4'23 R
Slide 14: Deposit Composition Provides Diversification
14 Deposit Composition Provides Diversification Commercial Deposits Increase Share of Total Deposits Total Retail $1,709,899 29% Total Public Fund $1,726,869 30% Total Commercial $2,304,041 39% Brokered Deposits $96,504 2% September 30, 2024 Total Deposits ‐ $5.8 billion DDA $1,284,527 DDA % of Tota
Slide 15: Diversified Deposit Base
15 Diversified Deposit Base Deposits Are Not Concentrated to Any Industry or Client • Deposit composition has remained stable with commercial deposits increasing as a percent of total deposits • Lake City Bank had 119,844 deposit accounts at September 30, 2024. 117,365, or 98%, of those accounts are
Slide 16: Public Fund Deposit Trends
‐$100,000 $100,000 $300,000 $500,000 $700,000 $900,000 $1,100,000 $1,300,000 $1,500,000 $1,700,000 Checking and MMA CDs 16 Public Fund Deposit Trends Majority of Public Funds are Core Checking Account Deposits $1 ,2 50 ,5 76 $1 ,2 15 ,5 33 $1 ,2 11 ,1 48 $1 ,2 53 ,7 04 $1 ,2 81 ,4 51 $1 ,1 27 ,1 11
Slide 17: Checking Account Trends by Deposit Sector
17 Checking Accounting Trends by Deposit Sector Commercial Accounts Grow by 21% since December 2019 $1 ,1 05 ,2 67 $2 ,0 79 ,4 07 $1 ,9 53 ,9 69 $2 ,1 05 ,4 11 $2 ,1 65 ,5 49 $6 58 ,4 51 $1 ,1 71 ,1 26 $1 ,0 73 ,3 14 $9 37 ,4 58 $8 97 ,8 15 $8 34 ,9 53 $1 ,2 18 ,8 54 $1 ,3 82 ,5 65 $1 ,3 09 ,9 65 $1
Slide 18: Liquidity Overview
18 Liquidity Overview • Available liquidity is stable at $3.7 billion, up from $3.3 billion at September 30, 2023 • Sources of liquidity are varied and represent wholesale funding and brokered deposits • Brokered deposits represent 2% of total deposits • Noncore funding represented 2% of total depos
Slide 19: Projected Impact of Rising/Falling Rates
19 Projected Impact of Rising/Falling Rates Asset Sensitive Balance Sheet Maintains Neutral Shift Graph presents 12 month projected net interest income simulation results as of September 30, 2024 using parallel shocks ‐3.03% ‐1.58% ‐0.59% ‐0.21% ‐0.07% 0.05% 0.07% 0.10% 0.07% 0.04% ‐4.00% ‐2.00% 0.0
Slide 20: Net Interest Margin
20 Net Interest Margin Deposit Mix has Stabilized • Noninterest bearing deposits to total deposits improved to 22% at September 30, 2024 compared to 21% at June 30, 2024 • Net interest margin expanded by 4 basis points in 3Q24 compared to 2Q24, excluding the impact of increased nonaccrual loans • Cu
Slide 21: Interest Rate Sensitivity
21 Interest Rate Sensitivity Continued Neutral Balance Sheet Sensitivity Fixed Rate $1,585,435 35% Prime $1,074,083 24% SOFR $1,275,932 28% FHLB/Other $559,976 13% Commercial Loans $4.5 billion as of September 30, 2024 (000’s) • Asset sensitivity impacted by shift to interest‐bearing transaction and
Slide 22: Shareholder Value Strategy
22 Shareholder Value Strategy 1. Commercial Banking Focus 2. High Quality Team Members 3. Proven Organic Growth Experience 4. Focus on Core Deposit Funding 5. Commitment to Technology
Slide 23: Commercial Banking Focus
23 Commercial Banking Focus Experienced Relationship Driven Team • 42 credit “smart” commercial bankers • Average 24 years in banking & 13 years at Lake City Bank • We live where we lend • Face to face calling matters and is a team effort • We understand our clients’ needs • Deep organizational stru
Slide 24: Credit Process
24 Credit Process Commercial Banking Focus • Our credit discipline has never changed • We have a centralized committee structure • We are in‐market lender to in‐market clients • Character matters – we lend to people first • We focus on management/cash flow • Structure is important and is disciplined
Slide 25: Corporate Social Responsibility
25 Corporate Social Responsibility Over 150 Years of Focusing on Our Customers, Employees and Our Communities • Supporting our communities since 1872 • Caring for and building a diverse and inclusive team • Delivering customer‐focused loan and deposit products to our communities • Developing strong
Slide 26: Lake City Bank Culture
26 Lake City Bank Culture High Quality Team Members • Our culture is our greatest asset and we will preserve it • Lake City University drives our culture • Diversity, Equity and Inclusion are ongoing initiatives that create a culture of belonging • Our community involvement is real and critical to o
Slide 27: Mature Market Deposit Performance
27 Mature1 Market Deposit Performance Organic Growth 2014 – 2024 $2,688 $2,495 $1,763 $521 $447 $373 $332 $257 ‐$219 ‐$1,210‐$1,500 ‐$1,000 ‐$500 $0 $500 $1,000 $1,500 $2,000 $2,500 $3,000 1st Source Lake City Bank JPM Chase Star Fifth Third PN C First M erchants O ld N ational KeyBank Flagstar(2) L
Slide 28: Expansion and Innovation Occurring Throughout Indiana
28 Expansion and Innovation Occurring Throughout Indiana • Indiana #1 manufacturing state in the country(1) • Indiana received tech hub designations from the federal government in microelectronics, hydrogen energy and biotechnology.(2) • Indiana to host semiconductor event in 2025. The state has att
Slide 29: Commitment to Technology
29 Commitment to Technology Innovation and Competitive Technology is a Focus • Fintech partnerships play a significant role in our technology stack and enable delivery of innovative solutions to our customers • Investments in Lake City Bank Digital, a Q2 product implemented in 2021 with ongoing func
Slide 30: Channel Utilization Today versus Pre-Pandemic
30 Channel Utilization Today versus Pre‐Pandemic Mobile Adoption Outpacing All Other Delivery Channels Period Change % of Total Total Transactions 2024(1) % of Total Total Transactions 2019(1) Channel Type (10)%14%2,051,45618%2,279,975Branch Transactions (18)%5%775,2437%944,785ATM/ITM (30)%24%3,547,
Slide 31: Customer Composition and Digital Adoption
31 Customer Composition and Digital Adoption Digital Platform Upgrade with Fintech Partner in 2021 Positively Impacting Digital Adoption Across All Generations Customer Composition and Digital Adoption Over Three Years 9/30/229/30/239/30/24 Customer Breakdown Generation(1) n/an/a2%4%Gen Alpha (2010
Slide 32: Financial Performance
Financial Performance
Slide 33: Income Performance Metrics
33 Income Performance Metrics LKFN Performance Exceeds National Peers and Contributes to Strong Capital Levels 1.76% 1.55% 1.56% 1.62% 1.45% 1.40% 15.47% 13.51% 14.19% 17.40% 15.93% 14.21% 15.57% 13.59% 14.27% 17.52% 16.03% 14.29% 4.00% 6.00% 8.00% 10.00% 12.00% 14.00% 16.00% 18.00% 20.00% 22.00% 0.
Slide 34: Net Income and EPS
34 Net Income and EPS Net Income Improves in 2024 $87,047 $84,337 $95,733 $103,817 $93,767 $101,575 $64,141 $69,288$3.38 $3.30 $3.74 $4.04 $3.65 $3.95 $2.49 $2.69 $0.50 $1.00 $1.50 $2.00 $2.50 $3.00 $3.50 $4.00 $4.50 $0 $20,000 $40,000 $60,000 $80,000 $100,000 2019 2020 2021 2022 2023 2023 Adjusted
Slide 35: Pretax Pre-Provision Earnings
35 Pretax Pre‐Provision Earnings Pretax Pre‐Provision Earnings Improves in 2024 $110,620 $118,646 $118,521 $134,539 $116,183 $126,544 $79,821 $95,522 2.24% 2.19% 1.93% 2.09% 1.80% 1.96% 1.56% 1.97% 0.00% 1.00% 2.00% 3.00% 4.00% 5.00% 6.00% $0 $20,000 $40,000 $60,000 $80,000 $100,000 $120,000 $140,00
Slide 36: Average Loans
36 Average Loans Average YTD Loan Growth of $232 million or 5% Compared to Prior Year 94% 95% 83% 77% 86% 87% 50% 60% 70% 80% 90% 100% 110% 120% $0 $1,000,000 $2,000,000 $3,000,000 $4,000,000 $5,000,000 $6,000,000 2019 2020 (1) 2021 (1) 2022 (1) 2023 YTD 2024 Retail Commercial Average Loans to Avera
Slide 37: Line of Credit Utilization
$1 ,6 30 $1 ,5 93 $1 ,6 37 $1 ,4 73 $1 ,4 46 $1 ,4 99 $1 ,4 10 $1 ,4 94 $1 ,5 53 $1 ,6 90 $1 ,7 46 $1 ,8 05 $1 ,8 24 $1 ,9 66 $1 ,8 85 $1 ,8 88 $1 ,8 07 $1 ,8 68 $1 ,8 37 $1 ,8 93 $1 ,9 03 $1 ,7 85 $1 ,8 35 $1 ,7 85 $2 ,0 66 $2 ,1 09 $2 ,0 44 $2 ,1 90 $2 ,2 06 $2 ,2 43 $2 ,3 21 $2 ,3 53 $2 ,3 98 $2
Slide 38: Line of Credit Utilization vs. Commercial DDA
38 Line of Credit Utilization vs. Commercial DDA Commercial DDA Deposit Balances Continue to Normalize $3 89 ,0 51 $4 67 ,4 58 $5 72 ,9 66 $6 60 ,3 60 $7 40 ,5 76 $7 75 ,9 47 $7 61 ,6 86 $7 72 ,9 95 $8 49 ,0 92 $8 14 ,4 30 $8 83 ,9 56 $1 ,2 16 ,4 14 $1 ,2 18 ,9 43 $1 ,2 73 ,8 86 $1 ,3 39 ,6 73 $1 ,4
Slide 39: Loan Portfolio Breakdown
39 Loan Portfolio Breakdown C&I Drives Lending Business Commercial & Industrial $1,492,883 30% Commercial RE ‐ Owner Occupied $810,453 16% Commercial RE ‐ Nonowner Occupied $766,821 15% Commercial RE ‐Multifamily $243,283 5% Commercial RE ‐ Construction $729,293 14% Agri‐business ‐ Agriculture $358,
Slide 40: Top 10 Industry Concentrations
Multifamily Housing $627,627 11% Agriculture $407,421 9% Industrial CRE $255,427 4% RV Industry $200,652 4% Senior Living $127,091 3% Automobile Dealers $120,043 3% Restaurants $119,608 2% Nonbank Lenders $110,670 2% Hotels $110,515 2% Misc. Durable Goods Merchant Wholesalers $102,651 2% 40 Top 10 I
Slide 41: Average Deposits
41 Average Deposits Average YTD Deposit Growth of $240 million or 4% Compared to Prior Year $4,242,524 $4,650,597 $5,357,284 $5,717,358 $5,604,228 $5,777,234 98% 98% 99% 100% 97% 98% 50% 60% 70% 80% 90% 100% 110% 120% 130% 140% 150% $0 $1,000,000 $2,000,000 $3,000,000 $4,000,000 $5,000,000 $6,000,00
Slide 42: Deposit Breakdown
42 Deposit Breakdown Deposit Costs Are Repricing Downward with Federal Funds Rate Cuts Total Retail $1,709,899 29% Total Public Fund $1,726,869 30% Total Commercial $2,304,041 39% Brokered Deposits $96,504 2% September 30, 2024 Total Deposits ‐ $5.8 billion (000’s) 0.00% 1.00% 2.00% 3.00% 20 11 20 1
Slide 43: Net Interest Income
43 Net Interest Income Net Interest Margin Compression Offset by Organic Loan and Deposit Growth $155,047 $163,008 $178,088 $202,887 $197,035 $148,436 $144,985 3.38% 3.19% 3.07% 3.40% 3.31% 3.33% 3.16% 2.50% 3.00% 3.50% 4.00% 4.50% $0 $50,000 $100,000 $150,000 $200,000 $250,000 2019 2020 2021 2022 2
Slide 44: Asset Quality: Nonperforming Loans
44 Asset Quality Nonperforming Loans Rise Due Primarily to a Single Commercial Credit 1. 52 % 2. 15 % 2. 75 % 1. 37 % 0. 94 % 0. 50 % 0. 42 % 0. 19 % 0. 25 % 0. 19 % 0. 46 % 0. 26 % 0. 35 % 0. 36 % 0. 32 % 1. 13 % 1. 22 % 1. 82 % 2. 20 % 1. 75 % 1. 31 % 0. 41 % 0. 35 % 0. 16 % 0. 20 % 0. 16 % 0. 38
Slide 45: Asset Quality: Allowance for Credit Losses
45 Asset Quality Allowance for Credit Losses Represents Strong Coverage 0. 42 % 0. 54 % 0. 25 % 0. 20 % 0. 11 % 0. 10 % 0. 09 % 0. 03 % ‐0 .0 1% 0. 13 % 0. 03 % 0. 09 % 0. 09 % 0. 10 % 0. 13 % 0. 04 % 1.59% 2.15% 2.39% 2.28% 1.92% 1.67% 1.42% 1.26% 1.23% 1.24% 1.25% 1.45% 1.59% 1.54% 1.46% 1.65% 0.0
Slide 46: Noninterest Income
46 Noninterest Income Noninterest Income Includes $9.0 million in Visa Stock Net Gain $44,997 $46,843 $44,720 $41,862 $49,858 $32,650 $44,968 22% 22% 20% 17% 20% 18% 24% 0% 10% 20% 30% 40% 50% 60% $0 $10,000 $20,000 $30,000 $40,000 $50,000 $60,000 2019 2020 2021 2022 2023 (1) YTD 2023 YTD 2024 N on
Slide 47: Total Revenue
47 2024 YOY Increase 5% Total Revenue Revenue Growth Benefited by Loan Growth and Improvement in Noninterest Income $200,044 $209,851 $222,808 $244,749 $246,893 $181,086 $189,953 $0 $50,000 $100,000 $150,000 $200,000 $250,000 $300,000 2019 2020 2021 2022 2023 YTD 2023 YTD 2024 (000’s) Compound annua
Slide 48: Non-Interest Expense
48 Non‐Interest Expense $89,424 $91,205 $104,287 $110,210 $130,710 $114,049 $101,265 $94,431 $0 $20,000 $40,000 $60,000 $80,000 $100,000 $120,000 $140,000 2019 2020 2021 2022 2023 2023 Adj. (1) YTD 2023 YTD 2024 (000’s) 2024 YOY Decrease (7)% 12023 noninterest expense adjusted reflects Core Noninter
Slide 49: Efficiency Ratio
49 Efficiency Ratio Efficiency Ratio Normalizing in 2024 51% 52% 50% 50% 48% 46% 45% 45% 43% 47% 45% 53% 50% 47% 0% 10% 20% 30% 40% 50% 60% 70% 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 YTD 2024 Efficiency Ratio Adjusted Core Efficiency Ratio Constant investment in technology and f
Slide 50: Stable Healthy Dividend
50 Stable Healthy Dividend Growth in Dividend Reflects Strength of Capital $1.16 $1.20 $1.36 $1.60 $1.84 $1.38 $1.44 2.40% 2.24% 1.70% 2.19% 2.82% 3.88% 2.95% 0.00% 1.00% 2.00% 3.00% 4.00% 5.00% 6.00% $0.10 $0.30 $0.50 $0.70 $0.90 $1.10 $1.30 $1.50 $1.70 $1.90 2019 2020 2021 2022 2023 YTD 2023 YTD 2
Slide 51: LKFN Shareholder Value Total Return Performance
51 LKFN Shareholder Value Total Return Performance from 12/31/00 to 9/30/24 20 00 20 01 20 02 20 03 20 04 20 05 20 06 20 07 20 08 20 09 20 10 20 11 20 12 20 13 20 14 20 15 20 16 20 17 20 18 20 19 20 20 20 21 20 22 20 23 LKFN S&P 500 S&P 500 Financials S&P US BMI Banks Index 3,500.00 3,000.00 2,500.0
Slide 52: Investment Highlights
52 Investment Highlights • Proven History of Organic Growth •Disciplined and Focused Strategy • Strong Internal Culture • Consistent Execution • Service Excellence Drives Shareholder Value
Slide 53: Supplemental Information
Supplemental Information
Slide 54: Lake City Bank Capital Adequacy
54 Lake City Bank Capital Adequacy Capital Strength Continues in September 2024 Non‐GAAP Adjusted Capital Ratios with AOCI and HTM Losses Non‐GAAP Excess Capital after AOCI and HTM Non‐GAAP AOCI and HTM Losses‐ after tax Capital Cushion (in 000’s) Well‐ Capitalized Threshold September 30, 2024 Actua
Slide 55: Liquidity Preparedness
55 Liquidity Preparedness September 30, 2024 (1) The BOD has authorized borrowing capacity up to $800 million, and qualifying collateral is required for availability (2) Brokered deposit capacity is equal to 10% of total deposits plus purchased funds, per LCB policy (3) Brokered money market capacit
Slide 56: Investment Portfolio
56 Investment Portfolio Recurring Cash Flows Used to Fund Organic Loan Growth M V In ve st m en ts a s a % o f A ss et s Note: Ratio of total securities to total assets excludes PPP loans of $412 million in 2020, $26 million in 2021 and $2 million in 2022 from total assets 13% 12% 12% 12% 12% 14% 21
Slide 57: Investment Security Portfolio Cashflows
57 Investment Security Portfolio Cashflows Cash Flows of $407 million Expected Through September 2028 19 ,2 66 ,0 32 18 ,9 35 ,3 00 19 ,3 90 ,2 94 19 ,3 27 ,9 02 17 ,8 85 ,4 76 19 ,3 08 ,3 88 17 ,3 47 ,0 95 19 ,5 22 ,0 33 21 ,0 69 ,3 02 14 ,0 43 ,7 75 15 ,9 12 ,8 60 16 ,9 85 ,1 52 15 ,4 39 ,3 01 13
Slide 58: Investment Portfolio Analysis
Investment Portfolio Analysis Investment Portfolio as a Percentage of Total Assets Continues to Decline 58 12/31/20239/30/2024 % of Total Market Value Weighted Maturity % of Total Market Value Weighted Maturity 8%98,2656.288%91,5755.81US Govt REMICS 30%349,5777.4429%331,4927.07US Govt Pools 10%119,4
Slide 59: Commercial Loans by County
59 Commercial Loans by County Commercial Customers in 49 Indiana Counties and 21 Other States (1) All other counties individually represent less than 2% of total September 30, 2024 (000’s) Allen 18% Elkhart 14%St. Joseph 9% Kosciusko 9% Hamilton 9% Marion 15% Marshall 3% Other IN Counties (1) 17% Ou
Slide 60: Larger Market Organic Expansion
60 Larger Market Organic Expansion Organic Growth # of Branches LCB Deposit Market Share** LCB EntryPopulation*Primary CityCounty State Rank 1267%187280,364WarsawKosciusko 22. 1122%1990206,409ElkhartElkhart6. 48%1997272,848South BendSt. Joseph5. 514%1999394,545Fort WayneAllen3. 81%20111,507,924India
Slide 61: Mature Market Strength and Growth
61 Mature Market Strength and Growth Organic Growth 2024 # of Offices 20142024 (millions)1 IncreaseShareDepositsShareDeposits 5299.52%15.68%$2,70119.43%$5,3891. 1st Source 5492.85%15.60%$2,68718.68%$5,1822. Lake City Bank 20102.50%9.99%$1,72012.56%$3,4833. JPM Chase 1630.67%7.06%$1,2165.73%$1,5894.
Slide 62: Lake City Bank
Qake City Bank LAKECITYBANK.COM