PSB Holdings, Inc. · OTC:PSBQ
PSB — Shareholder Meeting (April 2024)
50 slides from PSB's shareholder meeting presentation, Apr 16, 2024
Slide 1: Annual Shareholder Meeting
A nnual S hareholder M eeting
Slide 2: William J. Fish, Chairman
W illiam J . Fis h C hairman P S B Holdings , Inc . P eoples S tate B ank
Slide 3: PSB Holdings, Inc.
PSB HOLDINGS, INC \
Slide 4: Board of Directors
Board of Direc tors Retiring Joined in 2023-24 Peter W. Knitt Lee E. Guenther Lynn M. Falk George E. Fahr
Slide 5: Board of Directors
Board of Direc tors Proposed Tim Kilgore Jeff Wickersham
Slide 6: Scott M. Cattanach, President & CEO
S c ott M . C attanac h P res ident & C E O P S B Holdings , Inc . P eoples S tate B ank
Slide 7: Forward Looking Statements
Forward Looking S tatements Certain matters discussed in this presentation, including without limitation those relating to the growth of PSB, its profits, and future interest rates, are forward‐looking statements and are made pursuant to the safe harbor provisions of the Private Securities Litigatio
Slide 8: Agenda
A genda Scott M. Cattanach • Strategic Focus and Highlights • Issues Impacting Bank Values • Supporting Shareholder Needs Jessica M. Barnes • 2023 Financial Review • Shareholder Value Strategies Scott M. Cattanach • Formal Business – Shareholder Vote • Questions & Answers
Slide 9: What Can $390,000 Create?
W hat C an $ 3 9 0 ,0 0 0 C reate? Today’s Peoples State Bank 12 full-service branches and 1 loan production office with 212 employees serving 20,617 households and businesses from Eagle River to downtown Milwaukee, Wisconsin.
Slide 10: Shareholder Value Roadmap
S hareholder V alue Roadmap Improve shareholder liquidity through increased bank capital resulting in NASDAQ market index listing Reach $1.8 to $2 billion in assets by December 2026 Target 1.00% return on assets Maintain regular dividend growth
Slide 11: 2023 Strategic Highlights
20 23 S trategic Highlights Scott Wildman Dana Kolbe Connie Higgins Bryan Nill
Slide 12: 2023 Strategic Highlights
20 23 S trategic Highlights S tevens Point Full- S ervic e Offic e 138 McDill Ave., Stevens Point, WI 54481
Slide 13: 2023 Strategic Highlights
20 23 S trategic Highlights IT Ms & T C Rs
Slide 14: Customer Testimonial (video)
C us tomer T es timonial ( v ideo)
Slide 15: 2024 Strategic Objectives
2024 Strategic Objectives Right-size loan growth to rebuild capital flexibility and increase net interest margin
Slide 16: 2024 Strategic Objectives
2024 Strategic Objectives Open new downtown Milwaukee branch location 790 N. Jefferson Street Milwaukee, WI 53202
Slide 17: 2024 Strategic Objectives
2024 Strategic Objectives Rollout Ideal Team Player concept with staff to Re-establish internal service culture
Slide 18: Issues Impacting Bank Values
Issues Impacting Bank Values Short-term rates reflected in deposits have grown faster than renewing rates, lowering net margin Rising rates have lowered market value of fixed rates securities purchased before 2022, lowering reporting book value per share Concern over falling commercial real estate v
Slide 19: Value Comparisons
Value Comparisons 3-year price return 40.0% 30.0% |. STANDARD 25.9% EPOOR'SEO0 20.0% 10.0% 0.0% (10.0%) i APSB (20.0%) peel (22.2%) ABAQ (30.4%) KRE (30.0%) (40.0%) (50.0%) (60.0%) 4/11/2021 10/11/2021 4/11/2022 10/11/2022 4/11/2023 10/11/2023 4/11/2024 PSBQ -ABAQ KRE ‘S&P 500 Source: S&P Capital 1Q
Slide 20: Value Comparisons
Value Comparisons YTD price return 20.0% 15.0% 10.0% 9.0% shoorsson 5.0% 0.0% (5.0%) a a (3.7%) A PSB (10.0%) (10.5%) KRE (15.0%) (13.2%) ABAQ 0%) (20.0%) 12/29/2023 1/29/2024 2/29/2024 3/31/2024 PSBQ ABAQ KRE S&P 500 RAYMOND JAMES ALSB
Slide 21: Supporting Shareholder Needs
Supporting Shareholder Needs Focused on dividend growth Focus on building capital ratios to support shareholder liquidity Providing local, long-time, larger shareholders greater options to sell large blocks of shares that fit with their transition plans Continue shareholder DRIP and automatic invest
Slide 22: Factors Supporting Share Price Growth
Factors Supporting Share Price Growth Current market conditions allow new loans and renewing loans to reprice at “normalized” spreads – Loan yields moving higher at faster pace than deposit costs, increasing net margin Loan pipeline remains strong, even with economic uncertainty – Credit risk very l
Slide 23: Jessica M. Barnes, SVP & CFO
J es s ic a M . B arnes S enior V ic e P res ident C hief Financ ial Offic er P eoples S tate B ank
Slide 24: Historical Net Income & Earnings Per Share
Historical Net Income & Earnings Per Share
Slide 25: Net Income Growth
Net Income Growth Before & After Special Items ($000s) Net Income - as reported and proforma $14,000 $12,000 $10,000 $8,000 $6,000 $4,000 $2,000 $- 2019 2020 2021 2022 2023 Net income Net income before nonrecurring items
Slide 26: New Wisconsin Tax Law
New Wisconsin Tax Law The current Wisconsin state budget, signed by Governor Evers on July 5, 2023, included a provision offering an income tax exclusion on income earned from commercial loans of $5 million or less, originated for business or agricultural purposes to borrowers who reside or are lo
Slide 27: Diluted Earnings & Dividends Per Share
Diluted Earnings & Dividends Per Share $3.50 $3.00 $2.50 $2.16 $2.00 $1.50 $1.00 $0.60 $0.50 $- 2019 2020 2021 2022 2023 Earnings per share Dividends per share
Slide 28: Balance Sheet Growth & Composition
Balance Sheet Growth & Composition
Slide 29: Total Assets, Loans, & Deposits
Total Assets, Loans, & Deposits As of December 31, 2023 (in $000s) $1,600,000 $1,400,000 $1,424,100 $1,200,000 $1,000,000 $1,141,802 $1,078,705 $800,000 $600,000 $400,000 $200,000 $0 2019 2020 2021 2022 2023 Loans Deposits Assets
Slide 30: Loan Composition
Loan Composition 60.0% 55.10% 55.0% 50.0% 45.0% 40.0% 35.0% 30.0% 25.0% 20.0% 15.0% 10.0% 5.0% 0.0% 0.39% Commercial Commercial RE Residential RE Consumer 12/31/2019 12/31/2020 12/31/2021 mj 12/31/2022 12/31/2023 ALSB
Slide 31: Deposit Composition
Deposit Composition mt Nonint Bearing, Demand Int Bearing Demand & Savings mt Money Market Demand m Retail & Local Time i Wholesale Deposits 2019 2020 APSB HOLDINGS, INC. 2022 2023
Slide 32: Results Compared to Peer Banks
Results Compared to Peer Banks
Slide 33: Return on Average Tangible Common Equity vs. National Peer
Return on Average Tangible Common Equity vs. National Peer 16% 14% 12% 10% 9.65% 8% 6% 4% 2% 0% 2019 2020 2021 2022 2023 PSB S&P Global Market Intelligence Peer Median $1B - $2 B Assets Peers include all publicly-traded financial institutions with assets between $1.0 billion and $2.0 billion at 12/3
Slide 34: Loan Growth vs. National Peer
Loan Growth vs. National Peer Peers include all publicly-traded financial institutions with assets between $1.0 billion and $2.0 billion at 12/31/2023
Slide 35: Net Interest Margin vs. National Peer
Net Interest Margin vs. National Peer Peers include all publicly-traded financial institutions with assets between $1.0 billion and $2.0 billion at 12/31/2023
Slide 36: Net Interest Margin vs. Local Peer
Net Interest Margin vs. Local Peer Peers include Wisconsin-based financial institutions with assets between $1.0 billion and $2.0 billion at 12/31/2023
Slide 37: Efficiency Ratio vs. National Peer
Efficiency Ratio vs. National Peer 80% 70% 65.96% 60% 50% 40% 30% 20% 10% 0% 2019 2020 2021 2022 2023 PSB S&P Global Market Intelligence Peer Median $1B - $2 B Assets Peers include all publicly-traded financial institutions with assets between $1.0 billion and $2.0 billion at 12/31/2023
Slide 38: Measuring Shareholder Return
Measuring Shareholder Return
Slide 39: Business Model Strengths
Business Model Strengths Well-diversified loan portfolio with strong asset quality supported by conservative underwriting History of strong earnings with consistent dividend growth Margin stabilizing in an uncertain economic environment Deposit base stability and depth (strong liquidity) O
Slide 40: Annualized Dividends per Share
Annualized Dividends per Share Cash Dividends per share $0.70 $0.60 $0.60 $0.50 $0.50 $0.46 $0.42 $0.40 $0.40 $0.30 $0.20 $0.10 $- 2019 2020 2021 2022 2023
Slide 41: Tangible Book Value per Share and AOCI Impact
Tangible Book Value per Share and AOCI Impact
Slide 42: P/TBV Comparison
42 P/TBV Comparison 140.00% 135% 127% 127% 120.00% 112% 107% 109% 103% 93% 97% 100.00% 88% 80.00% 60.00% 40.00% 20.00% 0.23% 0.00% 2019 2020 2021 2022 2023 PSBQ P/TBV Peer Median P/TBV Peers include all publicly-traded financial institutions with assets between $1.0 billion and $2.0 billion at 12/31
Slide 43: Historical # of Shares Repurchased
Historical # of Shares Repurchased 43
Slide 44: DRP Plan
DRP Plan • DRP plan investors can choose to enroll in the plan and have quarterly stock purchases in lieu of dividends. • Continental Stock Transfer & Trust Co. will make open- market purchases once per quarter (the last day of the month following quarter end). • Initial investment in the plan is $1
Slide 45: Liquidity & Stability
Liquidity & Stability S ALSB
Slide 46: Liquidity Sources
Liquidity Sources Utilized Authorized Excess 12/31/2023 % of Assets Available Capacity Bankers' Bank Fed Funds Line $ - 0.0% $ 15,000,000 $ 15,000,000 Other Fed Funds Lines * $ - 0.0% $ 18,000,000 $ 18,000,000 FRB Discount Window * $ - 0.0% $ 25,138,000 $ 25,138,000 FHLB Advances & Wholesale repos $
Slide 47: Q1 2024 Earnings Released April 22, 2024
Q1 2024 Earnings Released April 22, 2024
Slide 48: Annual Business Meeting
Annual Business Meeting (OLDINGS, INC.
Slide 49: Questions?
Questions? (OLDINGS, INC.
Slide 50: Thank you!
Thank you! (OLDINGS, INC.