Choiceone Financial Services, Inc. · NASDAQ:COFS
Choiceone Financial Services — Investor Presentation (September 2022)
20 slides from Choiceone Financial Services's investor presentation, Sep 7, 2022
Slide 1: ChoiceOne Financial Services, Inc.
Slide 2: Disclaimer
• Forward Looking Statements. This presentation contains forward - looking statements that are based on management’s beliefs, assumptions, current expectations, estimates and projections about the financial services industry, the economy, and ChoiceOne Financial Services, Inc. These statements are n
Slide 3: Company Highlights
3 3 Company Highlights Numbers based on ChoiceOne internal data as of 6/30/2022 except where specifically identified. (1) Based on total assets; excludes savings and loan holding companies and savings banks on June 30, 2021. (2) See Non - GAAP reconciliation • As of June 30, 2022, COFS regulatory ca
Slide 4: Vision and Mission
4 4 Our vision is to be the best bank in Michigan. Our mission is to provide superior service, quality advice, and show utmost respect to everyone we meet.
Slide 5: Company Profile
5 5 ChoiceOne Financial Services, Inc . (“COFS”) was incorporated in 1986 as a Michigan corporation . ChoiceOne Bank was founded in 1898 (then called Sparta State Bank) in Sparta, MI at the corner of Division and Union Street . Over its more than 120 - year history, COFS has grown significantly, due
Slide 6: Awards & Accomplishments
6 6 Five Star Bank ( Bauer Financial – 2020 ) Award Nominee ( West MI Hispanic Chamber of Commerce – 2018 ) Source: COFS website Awards & Accomplishments With an abundance of accolades & awards, ChoiceOne Bank has been recognized as a top - tier community bank in Michigan & in the banking industry A
Slide 7: Management Team
7 7 Mr. Peter Batistoni has serves as Senior Vice President and Senior Lender of ChoiceOne Bank. Before then, he served as Senior Vice President and Senior Lender at Lakestone Bank & Trust, beginning in December 2016 and 2018 respectively. Prior to his employment there, he worked for Citizens State
Slide 8: Management Team
8 8 Ms. Shelly M. Childers has served as Senior Vice President and Chief Information Officer at ChoiceOne Bank since 2019. Prior to that Ms. Childers was the Senior Vice President and Chief Information Officer at Lakestone Bank and Trust. Ms. Childers has over 25 years of experience leading both the
Slide 9: Geographic Footprint
9 9 GRAND RAPIDS - KENTWOOD, MI Locations 10 Deposits $664,705 Market Share 2.20% Market Rank 12 SOUTHEASTERN MI (DETROIT MSA) Locations 13 Deposits $727,667 Market Share 0.36% Market Rank 13 MUSKEGON, MI Locations 5 Deposits $333,123 Market Share 15.71% Market Rank 3 Other, MI (1) Locations 3 Depos
Slide 10: M&A History
10 10 Transaction Overview Deal Profile (Announcement) Target Operating Metrics (Quarter Before Announcement) Target Target City, State Announcement Date Deal Value ($M) Consideration Total Assets Gross Loans LTM ROAA Muskegon, MI 1/6/2020 $21.9 76.5% Stock / 23.5% Cash $185.1 $147.2 0.49% Lapeer, M
Slide 11: Financial Summary
Financial Summary
Slide 12: Historic Balance Sheet Growth
12 12 Note: All dollars in thousands (1) Includes $138.0 million, $33.1 million and $1.8 million in PPP loans in 2020, 2021 and Q2 2022, respectively. All PPP loans ar e assumed to be deposits for "Total Deposits" graphic. (2) Core loans - exclude Paycheck Protection Program (“PPP”) loans, held for
Slide 13: Loan and Deposit Mix and Detail
13 13 Loan Commentary : ▪ History of successful small business and agriculture lending ▪ Strong commercial and industrial portfolio ▪ 52% of CRE loans are owner occupied ▪ Active residential real estate lending with sold (primarily service retained) and portfolio mortgages Deposit Commentary : ▪ Con
Slide 14: Investment Portfolio
14 14 Numbers based on ChoiceOne internal data as of 6/30/2022 except where specifically identified. (1) See second quarter 10 - Q for detail of derivatives purchased Investment Portfolio – COFS Securities Portfolio Breakdown SECURITY PORTFOLIO HIGHLIGHTS $996 Million Total Portfolio • COFS’ total s
Slide 15: Financial Performance Trends
15 15 Financial Performance Trends – COFS Profitability metrics have improved following the integration of M&A deals in 2019 and 2020; the efficiency ratio was 62.9% f or 2022, partly offsetting the effects of NIM compression over the same period Efficiency Ratio NIM ROAE ROAA 0.98% 1.15% 0.85% 0.94
Slide 16: Noninterest Income
16 16 Gain on Sale of Loans Service Charges BOLI Revenue Trust Revenue Brokerage Fees Insurance Revenue Other Fees 45% 4% 4% 4% 8% 35% 53% 4% 3% 0% 2% 4% 34% Note: Non - Interest Income amounts exclude gain on sale of securities. Noninterest Income – COFS Diversified sources of non - interest income
Slide 17: Loan Loss Reserve and Credit Mark Build
17 17 Note: All dollars in thousands (1) Remaining Credit Mark related to the mark against loans acquired in the County Bank Corp. and Community Shores Bank Corporati on transactions Loan Loss Reserve and Credit Mark Build – COFS COFS has an ALLL balance of $7.4 million and a $3.1 million accounting
Slide 18: Earnings Per Share
18 18 Earnings Per Share - COFS Tax rate of 21% is assumed for net impact of taxes (Dollars in thousands, except share data) Six months ended June 30, 2022 2021 2020 Basic Earnings Per Share Net income $ 11,143 $ 11,281 $ 7,684 Weighted average common shares outstanding 7,497,492 7,785,098 7,251,205
Slide 19: COFS Trades on the NASDAQ
C OF S T R ADES ON TH E NAS D A Q ® Market Makers in ChoiceOne Stock D. A. Davidson & Co. Nick Bi cking 800.394.9230 Raymond James & Associates Anthony LanFranca 312.655.2961 Stifel, Nicolaus & Company, Inc. Paul Drueke 616.224.1553 Stock Registrar & Transfer Agent Continental Stock Transfer & Trust
Slide 20: Appendix: Non-GAAP Reconciliation
20 20 (1) Adjusted to a fully tax - equivalent basis to facilitate comparison to the taxable interest - earning assets. The adjustment use s an incremental tax rate of 21%. The presentation of these measures on a tax - equivalent basis is not in accordance with GAAP, but is customary in the banking
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