Slide 1: Investor Call 4Q 2022
1 INVESTOR CALL 4Q 2022 January 24, 2023, 10:00am ET Webcast: www.smartbank.com (Investor Relations) Audio Only: 1 - 844 - 200 - 6205 Access Code: 179408 Miller Welborn Chairman of the Board Billy Carroll President & CEO Ron Gorczynski CFO
Slide 2: Disclosures: Forward-Looking Statements
D ISCLOSURES 2 Forward - Looking Statements This presentation may contain statements that are based on management’s current estimates or expectations of future events or future results, and that may be deemed to constitute forward - looking statements as defined under the Private Securities Litigati
Slide 3: SmartBank 2022: A Year in Review - Financial Highlights
'20 -'22 2020Y 2021Y 2022Y CAGR 3 Total Loans and Leases 2,382.2 $ 2,693.4 $ 3,229.0 $ 16% Annual Net Balance Loan Growth (Excl. PPP) 190.1 547.8 587.9 76% Total Deposits 2,805.2 4,021.9 4,077.1 21% Loan / Deposit Ratio 85% 67% 79% Operating Revenue 1 115.8 137.3 165.1 19% Operating PTPP Earnings 1
Slide 4: Quarterly Highlights: Fourth Quarter 2022
$0.40 $0.68 $0.77 $0.52 $0.69 $0.76 4Q21 3Q22 4Q22 GAAP EPS D ILUTED O PERATING EPS $25.56 $24.56 $25.59 $19.26 $18.02 $19.09 4Q21 3Q22 4Q22 BV P ER S HARE TBV P ER S HARE 0.59% 0.95% 1.11% 0.77% 0.96% 1.10% 4Q21 3Q22 4Q22 GAAP ROAA O PERATING ROAA 8.2% 14.4% 16.7% 10.7% 14.4% 16.5% 4Q21 3Q22 4Q22 G
Slide 5: SmartFinancial: Expanding Southeast Franchise
5 S MART F INANCIAL : E XPANDING S OUTHEAST F RANCHISE $4.6 B ILLION IN T OTAL A SSETS $3.2 B ILLION IN T OTAL L OANS We are building a culture where Associates thrive and are empowered to be leaders .. The core values that we have established as a company help us operate in unison and have become a
Slide 6: Market Area: Targeting Industry Rich Growth Markets
$2.0 $2.1 $2.3 $2 $2 $2 $2 $2 $2 $2 12/31/20 12/31/21 12/31/22 SMBK L OANS $2.5 $3.5 $3.4 $ - $1 $1 $2 $2 $3 $3 $4 $4 $5 12/31/20 12/31/21 12/31/22 SMBK D EPOSITS $0.4 $0.6 $0.9 $ - $0 $0 $0 $0 $1 $1 $1 $1 $1 $1 12/31/20 12/31/21 12/31/22 SMBK L OANS $0.3 $0.5 $0.7 $(0) $0 $0 $0 $0 $0 $1 $1 $1 $1 12
Slide 7: Loan Portfolio: Solid Markets Providing Opportunity
22% 22% 23% 23% 24% 29% 31% 28% 27% 26% 2% 1% 16% 15% 16% 16% 17% 10% 11% 12% 13% 12% 18% 17% 18% 18% 18% 3% $2,693 $2,806 $2,994 $3,099 $3,229 4Q21 1Q22 2Q22 3Q22 4Q22 CRE, OO CRE, NOO PPP L OANS C&I C&D C ONSUMER RE L EASES & O THER $1,319 $1,775 $1,897 $2,382 $2,693 $2,806 $2,994 $3,099 $3,229 5.
Slide 8: Loan Concentration: Well Balanced Exposure
1 - 4 Family (NOO) 27% Resi/Comm Land Dev. 13% Resi/Comm Land 17% Multifamily 13% CRE (OO) 11% CRE (NOO) 12% Multifamily 17% Hotel & Hospitality 35% Retail Space 14% Office Space 14% Misc. 10% 8 L OAN C ONCENTRATION : W ELL B ALANCED E XPOSURE CRE E XPOSURE B Y S EGMENT H IGHLY D IVERSIFIED WITH S E
Slide 9: Asset Quality
$5,058 $4,981 $5,042 $4,605 $4,808 0.11% 0.11% 0.11% 0.10% 0.10% -0.10% 0.10% 0.30% 0.50% 0.70% 0.90% 1.10% 1.30% 1.50% $- $2,000 $4,000 $6,000 4Q21 1Q22 2Q22 3Q22 4Q22 N ONPERFORMING L OANS OREO & O THER R EPOS N ONPERFORMING A SSETS / T OTAL A SSETS $8,991 $5,738 $6,588 $6,398 $7,645 0.33% 0.20% 0
Slide 10: Reserve Reconciliation
$19,352 $20,078 $21,938 $22,769 $23,334 $15,483 $14,913 $14,737 $14,465 $13,128 0.74% 0.74% 0.74% 0.75% 0.73% 0.00% 0.50% 1.00% 1.50% 2.00% $- $2,000 $4,000 $6,000 $8,000 $10,000 $12,000 $14,000 $16,000 $18,000 $20,000 $22,000 $24,000 4Q21 1Q22 2Q22 3Q22 4Q22 A LLOWANCE FOR L OAN L OSSES A CQUIRE L
Slide 11: Deposit Portfolio: Defending Deposit Market Share
$1,439 $1,922 $2,047 $2,805 $4,022 $4,191 $4,282 $4,280 $4,077 0.55% 0.86% 1.12% 0.55% 0.27% 0.20% 0.24% 0.45% 0.85% 0.00% 0.50% 1.00% 1.50% 2.00% 2.50% 3.00% $ - $500 $1,000 $1,500 $2,000 $2,500 $3,000 $3,500 $4,000 $4,500 2017Y 2018Y 2019Y 2020Y 2021Y 1Q22 2Q22 3Q22 4Q22 26% 26% 27% 28% 26% 22% 23
Slide 12: Net Interest Income and Net Interest Margin
$1,045 $764 $655 $543 $266 $559 $830 $813 $807 $770 12.1% 17.6% 17.0% 16.8% 16.7% 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0% 45.0% 50.0% $- $200 $400 $600 $800 $1,000 $1,200 4Q21 1Q22 2Q22 3Q22 4Q22 C ASH AND C ASH E QUIV .. S ECURITIES (AFS/HTM) S ECURITIES (AFS/HTM) / T OTAL A SSETS $29,8
Slide 13: Interest Rate Sensitivity
$375 , 0.3% $(600) , - 0.4% $(1,363) , - 1.0% I NTERST I NCOME % C HANGE S HOCK - 100 BPS S HOCK +100 BPS S HOCK +200 BPS $35 , 0.0% $44 , 0.0% $(86) , - 0.1% I NTEREST I NCOME % C HANGE R AMP - 100 BPS R AMP +100 BPS R AMP +200 BPS 13 I NTEREST R ATE S ENSITIVITY F IXED VS .. V ARIABLE R ATE L OANS
Slide 14: Noninterest Revenue Details: Growing Fee Income
$6,806 $7,111 $7,229 $6,250 $6,981 4Q21 1Q22 2Q22 3Q22 4Q22 S ERVICE C HARGES ON D EPOSIT A CCOUNTS M ORTGAGE B ANKING I NCOME I NVESTMENT S ERVICES I NCOME I NSURANCE C OMMISSIONS I NTERCHANGE F EES O THER N ONINTEREST I NCOME 14 N ONINTEREST R EVENUE D ETAILS : G ROWING F EE I NCOME O PERATING N O
Slide 15: Operating Expense: Investing With an Eye on Efficiencies
68% 68% 64% 63% 61% 4Q21 1Q22 2Q22 3Q22 4Q22 O PERATING E FFICIENCY R ATIO $25,061 $25,279 $25,845 $27,143 $27,461 4Q21 1Q22 2Q22 3Q22 4Q22 S ALARIES & B ENEFITS O CCUPANCY & E QUIPMENT D ATA P ROCESSING & T ECHNOLOGY P ROFESSIONAL S ERVICES A MORTIZATION OF I NTANGIBLES O THER N ONINTEREST E XPENSE
Slide 16: Capital: Well Capitalized - Building Book Value
7.2% 6.8% 6.7% 6.5% 7.2% 4Q21 1Q22 2Q22 3Q22 4Q22 10.2% 10.3% 10.0% 9.6% 9.7% 4Q21 1Q22 2Q22 3Q22 4Q22 7.5% 7.4% 7.5% 7.4% 8.0% 4Q21 1Q22 2Q22 3Q22 4Q22 12.2% 12.2% 11.8% 11.4% 11.5% 4Q21 1Q22 2Q22 3Q22 4Q22 $13.90 $14.64 $16.82 $17.92 $19.26 $19.09 $14.01 $14.84 $16.80 $17.77 $19.17 $21.18 $8.00 $1
Slide 17: Why SmartBank: Investment Highlights
W HY S MART B ANK : I NVESTMENT H IGHLIGHTS 17 F RANCHISE S CARCITY V ALUE – B UILDING S OUTHEAST D ENSITY E NGAGED M ANAGEMENT T EAM S TABLE M ARKETS E XPERIENCING P OPULATION E XPANSION L OW - C OST D EPOSIT B ASE G ROWING B USINESS L INES WITH R EVENUE D IVERSIFICATION S OLID C REDIT Q UALITY AND
Slide 18: Appendix
aly, SmartFinancial APPENDIX
Slide 19: Income Statement: Detailed Fourth Quarter Results
19 Note: For a reconciliation of Non - GAAP financial measures to their most directly comparable GAAP measures, see the Appendix; per centage change may differ due to rounding I NCOME S TATEMENT : D ETAILED F OURTH Q UARTER R ESULTS 3Q22 4Q21 ($ in thousands, except per share data) 4Q22 3Q22 4Q21 %
Slide 20: Operating Expense: Technology Initiatives
Branch Network Modernization Q2 2021 20 Digital Consumer Deposit Origination Upgrade Q2 2021 Treasury Management Platform Upgrade Q1 2022 Q2 2021 Cloud - Based Contact Center Enhanced Cyber Security Technology Q2 2021 O PERATING E XPENSE : T ECHNOLOGY I NITIATIVES I NVESTING IN OUR P LATFORM TO M AK
Slide 21: Non-GAAP Reconciliation
N ON - GAAP R ECONCILIATION 21 $ in Thousands, except per share data 1. Operating return on average assets (Non - GAAP) is the annualized operating earnings (Non - GAAP) divided by average assets .. 2. Operating PTPP return on average assets (Non - GAAP) is the annualized operating PTPP earnings (No
Slide 22: Non-GAAP Reconciliation
N ON - GAAP R ECONCILIATION 22 $ in Thousands, except per share data 1. Book value per share is computed by dividing total stockholders’ equity by common shares outstanding .. Tangible book value per share (Non - GAAP) is computed by dividing total stockholders’ equity, less goodwill and other intan
Slide 23: Contact
C ONTACT 23 B ILLY C ARROLL P RESIDENT & CEO 865.868.0613 B ILLY ..C ARROLL @ SMARTBANK .. COM M ILLER W ELBORN C HAIRMAN 423.385.3067 M ILLER ..W ELBORN @ SMARTBANK .. COM 5401 K INGSTON P IKE , S UITE 600 K NOXVILLE , TN 37919 R ON G ORCZYNSKI C HIEF F INANCIAL O FFICER 865.437.5724 R ON ..G ORCZY
Slide 24: SmartFinancial | B —.
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