Farmers National Banc Corp. · NASDAQ:FMNB
Farmers National Banc — Merger or Acquisition (March 2022)
13 slides from Farmers National Banc's merger presentation, Mar 24, 2022
Slide 1: Acquisition of Emclaire Financial Corp. Investor Presentation
Acquisition of INVESTOR PRESENTATION MARCH 24, 2022
Slide 2: Disclosure Statement
DISCLOSURE STATEMENT Forward Looking Statements This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements about the financial condition, results of operations, asset quality trends and profitability of Farme
Slide 3: Strategic Partnership to Drive Competitive Scale
STRATEGIC PARTNERSHIP TO DRIVE COMPETITIVE SCALE • Unique opportunity to acquire scale in attractive Western PA markets including metro Pittsburgh Compelling • Ability to maximize the Farmers brand of both institutions and conversion of same core system New Market • Opportunity to better compete for
Slide 4: Proven Acquisition History and Strategy
PROVEN ACQUISITION HISTORY AND STRATEGY Long-Term Strategy of Value-Enhancing Acquisitions Emclaire Seven acquisitions in the past $6,000 Financial seven years* Corp (2022) $5,000 Cortland Target franchises with similar Bancorp (2021) culture, compelling reputation, and strong customer base $4,000 M
Slide 5: Building Franchise Value
BUILDING FRANCHISE VALUE Successful Track Record of Adding Value Through M&A; Proven Ability to Execute Prudently Upon Acquisitive Growth Transaction: National Bancshares Tri-State Monitor Maple Leaf Cortland Emclaire Financial Total of Recent Corporation 1st Banc, Inc. Bancorp, Inc. Financial Banco
Slide 6: Pro Forma Franchise
PRO FORMA FRANCHISE Pro Forma Highlights(1) $5.2B Assets $3.2B Loans $4.5B Deposits 66 Branches $648.3M Market Cap(2) (1) Estimated at close 6 (2) Market capitalization based upon FMNB closing price of $17.02 as of March 23, 2022 Source: Company provided documents
Slide 7: Complementary Franchises with Strong Performance
COMPLEMENTARY FRANCHISES WITH STRONG PERFORMANCE Ability to further enhance Emclaire’s financial performance through cost savings, efficiency gains, cross-selling opportunities and other enhancements. LTM Return on LTM Return on LTM Efficiency LTM Net Average Assets Tangible Common Equity Ratio Inte
Slide 8: Emclaire Financial Corp Financial Highlights
EMCLAIRE FINANCIAL CORP FINANCIAL HIGHLIGHTS For the Twelve Months Ended Quarters Ended ($000) 12/31/2019 12/31/2020 12/31/2021 3/31/2021 6/30/2021 9/30/2021 12/31/2021 Balance Sheet Total Assets $915,296 $1,032,323 $1,059,508 $1,067,711 $1,107,059 $1,084,974 $1,059,508 Total Gross Loans $701,904 $8
Slide 9: Pro Forma Loan and Deposit Composition
PRO FORMA LOAN AND DEPOSIT COMPOSITION Pro Forma Loan Portfolio Composition Cons. PRO FORMA Cons. C&D Agr. 2.1% Agr. 8.4% 7.8% $2,331.1 2.4% All Other $790.9 $3,122.0 1.8% All 1-4 Family Other 13.5% C&D 34.6% 10.1% 1-4 1-4 Family 8.3% Family 19.4% 23.3% Cons. C&I C&I 6.1% 10.0% 13.4% Multi- Family T
Slide 10: Transaction Terms
TRANSACTION TERMS • 2.1500 shares of FMNB common stock or $40.00 per share in cash for each share of EMCF, subject Consideration to 70% of EMCF shares being exchanged for stock and 30% being exchanged for cash • Aggregate Deal Value of $104.8M or $37.62 per share(1) • Deal Value / Tangible Book Valu
Slide 11: Modeling Assumptions
MODELING ASSUMPTIONS • Total gross credit mark of $15.4 million (1.9% of EMCF’s gross loan portfolio excluding loans held for Credit sale and PPP loans) Mark o $7.1 million allocated to purchase credit deteriorated (PCD) loans o $8.3 million allocated to non-PCD loans • ~$9.7 million write-up of loa
Slide 12: Financial Impact Summary
FINANCIAL IMPACT SUMMARY Estimated Pro • $5.2 billion in total assets (26.0% increase) Forma Balance • $3.2 billion in total loans (36.1% increase) Sheet(1) • $4.5 billion in total deposits (27.2% increase) • 9.5% projected accretion to FMNB’s 2023 EPS (75% cost savings phased-in in first 12 months
Slide 13: Comprehensive Due Diligence
COMPREHENSIVE DUE DILIGENCE • Completed a coordinated comprehensive due diligence review with executives from FMNB & EMCF, along with advisors & consultants • Detailed credit review completed by internal team and augmented with a 3rd party independent review Loan Review Process Diligence Focus Areas
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