Primis Financial Corp. · NASDAQ:FRST
Primis Financial — Q2 2023 Earnings Presentation
23 slides from Primis Financial's earnings presentation, Jul 27, 2023
Slide 1: Second Quarter 2023
Second Quarter 2023 NASDAQ: FRST Exhibit 99.2 PRIMIS
Slide 2: Forward-looking statements
This Presentation and certain of our other filings with the Securities and Exchange Commission contain statements that constitute “forward-looking statements” within the meaning of, and subject to the protections of, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Secur
Slide 3: Non-GAAP financial measures
Statements included in this presentation include non-GAAP financial measures and should be read along with the accompanying tables. Primis uses non-GAAP financial measures to analyze its performance. The measures entitled net income adjusted for nonrecurring income and expenses; pre-tax pre-provisio
Slide 4: Welcome to Primis
A pioneering bank, committed to imagining a faster and more convenient way to serve you. WELCOME TO PRIMIS Corp. Headquarters: McLean, VA Bank Headquarters: Glen Allen, VA Branches: 32 Ticker (NASDAQ): FRST Valuation Market Capitalization: $232 million Price / Book Value per Share 0.59x Price / Tang
Slide 5: Second Quarter Overview
Second Quarter Overview Sold or took near-term contracts that will move NPAs to 0.13% of total assets. Started sweeping excess funds on June, 30, 2023. If in place for all of Q2: Moves margin higher by 35 bps Moves leverage ratio to 8.6% Positions the Company to have peer group leading credit qualit
Slide 6: Valuable and Reliable Funding Sources
Valuable and Reliable Funding Sources Core bank continues to provide highly attractive funding at levels generally better than peer and regional competition Alternative sources for funding alleviate pressure to reprice Primis bank (the “Bank”) to raise liquidity and proves thesis of digital strategy
Slide 7: Organization Focused on Funding; Rolling out Technology and Consolidating Branches
Organization Focused on Funding for Past Three Years Rolling out Technology and Consolidating Branches Attractive community bank deposit base with core bank cost of deposits of only 1.80% in Q2 V1BE adoption/utilization continues to build with monthly transactions up 43% in Q2, primarily due to smal
Slide 8: Panacea Financial Update
Total loan originations since launch of $386.0 mil. (committed bal.) Q2’23 loan originations of $75.6 mil. Production yields of 8.17%. Total deposits of $46.3 mil., up 50.0%+ un-annualized qtr./qtr. Pipeline includes $20 mm of NIB deposits, mostly commercial Opened >650 new deposit accounts, up 54%
Slide 9: Life Insurance Premium Finance Update
4 Life Insurance Premium Finance Update Key Portfolio Metrics Key Performance Metrics 27 Average number of days from submission to loan closing ORIGINATION CYCLE TIME Average Actual Primis Processing Time is ~5 Days Placement Ratio Carrier Approvals Top-Tier Partners Facilitators 68% 27 82 6 Average
Slide 10: Primis Mortgage Update
Primis Mortgage Update Pre-tax earnings for Q2: $647K 35 bps of pretax profitability with less than $200mm of quarterly production illustrates the discipline and opportunity with our strategy Funded production of $184 million, up 49% from Q1’23 Now licensed in 42 states and D.C. Locked pipeline at J
Slide 11: Second Quarter Results
Second Quarter Results
Slide 12: Second quarter results highlights
Growth in average deposits of $494 million or 62% annualized versus the previous quarter. New non-time deposit accounts for the quarter totaled 4,315 accounts with balances of $112 million at the end of the second quarter of 2023. Cumulative beta on the core bank’s interest bearing deposits of only
Slide 13: Balance Sheet Trends
Dollars in millions. See reconciliation of Non-GAAP financial measures on slide 23. Balance Sheet Trends (1)
Slide 14: Non-Owner-Occupied CRE by Type
Non-Owner-Occupied CRE by Type Total Outstanding % of Portfolio Excl PPP Hotel $208 6.6% Office $149 4.7% Retail $93 2.9% Assisted Living $46 1.4% Daycare/Schools/Churches $30 1.0% Warehouse/Industrial $21 0.7% Self Storage and Other $44 1.4% Total Non-Owner Occupied CRE $592 18.7% Built Diversifica
Slide 15: Asset Quality
Classified loans and NPAs exclude guaranteed portion of SBA loans. Core net charge-offs exclude losses covered by a third party. Asset Quality NPAs / Loans (Ex. PPP) + OREO Core NCOs / Average Loans Criticized & Classified Loans / Total Loans (Ex. PPP) Nonperforming assets and classified loans decre
Slide 16: Allowance for Credit Losses
Allowance for Credit Losses ACL Walk Forward ACL / Gross Loans (Ex. PPP) Provision for credit losses of $4.3 million in Q2 versus provision of $5.2 million in Q1 Provision includes $1.42 million related to third-party managed portfolio with credit enhancement Provision offset by gain of equal amount
Slide 17: Deposit Trends
Dollars in millions. (1) Core deposits exclude time deposits and includes deposits that were swept off at 6/30 Deposit Trends Deposit Composition – Q2’23 Core Deposit Growth(1) Total deposits were essentially flat compared to Q1’23 when including $348 million swept to other banks at June 30, 2023 Un
Slide 18: Net Interest Income Progression
Net Interest Income Progression Dollars in thousands. Core excludes impact of PPP balances (1) Net Interest Margin (Core) excludes excess deposits in Q1’23 and Q2’23 Net Interest Income and Net Interest Margin Net interest margin negatively impacted by excess liquidity on the balance sheet. Excludin
Slide 19: Non-Interest Expense and Efficiency Ratio
Q2 NIE, excluding unfunded commitment expense, includes the following: $0.5 million of expense due to third-party serviced loan portfolio, down from $0.9 million last quarter Mortgage expenses of $5.3 million, up from $5.0 million last quarter Branch closure and other restructuring costs of $1.5 mil
Slide 20: Per Share Results
Tangible Book Value Per Share Diluted Earnings Per Share and Adjusted Diluted EPS (1) See reconciliation of Non-GAAP financial measures on slide 23. Per Share Results AOCI impact to TBV per share of $1.05 at June 30, 2023, expected to recover over time given our intent and wherewithal to hold until
Slide 21: Summary
Talented management team and board committed to building long-term shareholder value Attractive multi-pronged strategy for growth beginning to pay dividends Aggressive and early use of technology positioning the Bank for superior performance as the industry evolves Significant valuation upside as st
Slide 22: Appendix
Appendix
Slide 23: Non-GAAP Reconciliation
*Net interest margin excluding the effect of PPP loans assumes a funding cost of 35 bps on average PPP balances in all applicable periods. Non-GAAP Reconciliation Primis Financial Corp. (Dollars in thousands, except per share data) For Three Months Ended: For Six Months Ended: Reconciliation of Non-