Slide 1: Unity Bancorp, Inc. 6/30/16
W Unity BANCORP INC 6/30/16 NASDAQ: UNTY
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation may contain forward-looking statements with respect to Unity Bancorp’s financial condition, results of operations and business. Do not unduly rely on forward-looking statements. Forward- looking statements can be identified by the use of words such as “ma
Slide 3: Company Snapshot
Company Snapshot « Founded September 16, 1991 « Headquartered in Clinton, New Jersey « Approximately $1.1 billion in assets and $912 million in deposits « Unity Bank provides financial services to retail, corporate and small business customers through its 17 retail service offices located in Bergen,
Slide 4: Bank Franchise
Bank Franchise Bergen County, NJ: Emerson (Coming Soon) Somerset County, NJ: North Plainfield, Somerset, Hunterdon County, NJ: Clinton, Flemington, Whitehouse Somerville (Coming Soon) Middlesex County, NJ: Edison, Highland Park, Middlesex, South * Union County, NJ: Linden, Scotch Plains, Union Plain
Slide 5: High household income in our market counties
* High household income in our market counties relative to the State of New Jersey and the nationwide medians — State of New Jersey ranks 2" in the nation in median household income, 4*in per capita income, and 2" in population density * — With respect to median household income, Hunterdon County an
Slide 6: Strategic Goals
Strategic Goals « To grow our business relationships by being a responsive bank, providing excellent service with flexible terms and conditions— 10% loan growth « Mortgage Division — 15% growth rate in purchased transactions « SBA Division — Increase 7A Volume no less than $30 million « Growth in co
Slide 7: Senior Management
Senior Mar James A. Hughes, CPA Alan J. Bedner, Jr. CPA emen m + President and Chief Executive Officer + Chief Financial Officer + Joined the company in 2000 + Joined the company in 2001 + 28 years banking experience * 21 years banking experience + Previously employed at Summit Bancorp + Previously
Slide 8: Engaged Board of Directors
Engaged Board of Directors ¢ David Dallas, Chairman of the Board, and Robert Dallas, Board Member, both founding members of the Bank @ Average tenure of Board Members is 15 years @ Diverse experience including financial industry, medical professionals, university professional and business ownership
Slide 9: Recent Financial Performance
Recent Financial Performance an
Slide 10: Summary Balance Sheet
Summary Balance Sheet (dollars in millions) 2014Y 2015Y 2Q2016 Assets $ 1,008.8 |$ 1,084.9 |$ 1,128.4 Total Loans 761.8 889.0 915.0 Deposits 794.3 894.5 912.2 Total Equity 70.1 78.5 85.0
Slide 11: Loan Mix
Loan Mix (dollars in millions) $800 $9150 = $764 serer [ssa | $587.0 . 2012Y 2013Y 2014Y 2015Y 202016 Commercial Loans mMortgage Loans SBALoans Consumer Loans
Slide 12: Mortgage Loan Originations
Mortgage Loan Originations (dollars in millions) Mortgage Growth $200.00 $181.0 $180.00 $160.00 $153.7 $140.00 $133.6 $129.8 $120.00 $100.00 $94.2 $80.00 $60.00 $40.00 $20.00 $- 2012Y 2013Y 2014Y 2015Y 2016 YTD Purchases sRefinances
Slide 13: Asset Quality Continues to Improve
1.80% 1.60% 1.40% 1.20% 1.00% 0.80% 0.60% 0.40% 0.20% 0.00% Asset Quality Continues to Improve NPLs/ Li ns 1.16% 202015 302015 42015 102016 202016 aNonperforming Loans @TDRs 2
Slide 14: Deposit Trend
5 Year Deposit Trend (dollars in millions) $9945 $9122 $794.3 $7387 $185.3 $210.0 $64 $152.8 $136.0 $1144 2012v 2013Y 2014Y 2015Y 202016 alnterest-bearing DDA & SAV deposits Total time deposits Noninterest-bearing demand deposits B
Slide 15: Summary Income Statement and Profitability
Summary Income Statement and Profitability (dollars in millions) 2015 YTD 2016 YTD Net Interest Income 16.4 Provision for Loan Losses 0.2 Noninterest Income 3.5 Noninterest Expense 13.2 13.3 Provision for Income Taxes 2.2 3.9 Net Income $ 44 |$ 7.0 Diluted Earnings Per Share |S 0.51 $s 0.82 Retum on
Slide 16: Net Interest Income & Net Interest Margin
Net Interest Income & Net Interest Margin (dollars in millions) $40.00 4.00% 3.67% es, 3.62% 3.63% 3.55% ® SS —s 3.50% $30.00 3.00% $25.00 $20.00 2.50% $15.00 2.00% $10.00 1.50% $6.00 s 1.00% 2012 2013Y 2014Y 2015Y 6/30/2015 YTD 6/30/2016 YTD ga Net Interest Income = Net Interest Margin
Slide 17: Strong Levels of Noninterest Income
Strong Levels of Noninterest Income (dollars in millions) Noninterest Income (excludes g: s [losses] on secur’ $10.00 19-48% 20.00% $9.00 18.05%" $8.00 + 18.00% $7.00 $6.00 16.00% $6.00 $4.00 14.00% $3.00 $2.00 12.00% $1.00 s 10.00% 2012 2013Y 2014Y 2015Y 6/30/2015 YTD 6/30/2016 YTD TiBNoninterest I
Slide 18: Noninterest Income
Noninterest Income (dollars in thousands) 6/30/2015 YTD 6/30/2016 YTD Branch fee income 719/$ 619 Service and loan fee income 762 522 Gain on sale of SBA loans held for sale, net 363 945 Gain on sale of mortgage loans, net 1,031 1,308 BOLI income 189 187 Net security gains 28 115 Net gain on repurch
Slide 19: Noninterest Expense Controls
Noninterest Expense Controls (dollars in millions) Noninterest 3.02% 2.00% 0.00% 2012Y 2013Y sama Noninterest Expense 2014Y 2015Y 6/30/2015 YTD 6/30/2016 YTD =@-Noninterest Expense/Average Assets ‘Note: 6/30/2015 YTD and 6/30/2016 YTD ratios are annualized. 18
Slide 20: Noninterest Expense
Noninterest Expense (dollars in thousands) 6/30/2015 YTD _ 6/30/2016 YTD Compensation and benefits $ 6,952/$ 7,258 Occupancy 1,273) 1,131 Processing and communications 1,210) 1,198 Fumiture and equipment 795) 815 Professional services 478) 494 Loan costs 382 257 OREO expenses 103) 105 Deposit insura
Slide 21: Profitability Progression
Profitability Progression Diluted Earni $0.82 : sor 2011Y 2012Y 2013Y 2014Y 2015Y 6/30/2016 YTD (© Effect of nonrecurring gain on repurchase of subordinated debenture
Slide 22: Tangible Book Value Per Share
$10.00 $9.50 $9.00 $8.50 $8.00 $7.50 $7.00 $6.50 $6.00 Tangible Book Value Per Share 2012 2013Y 2014Y 2018Y 202016 Note: 2013 reflects redemption of TARP preferred stock and the associated warrant a
Slide 23: Market Price
Market Price $14.00 $12.00 $10.00 $8.00 $6.00 $4.00 $2.00 $- 2012Y 2013Y 2014Y 2015Y 202016
Slide 24: Capital Ratios
Capital Ratios Leverage 12.00% 10.00% HE unity Bancorp, Inc. 8.00% GM Fpic-nsured Commercial Banks 6.00% 4.00% 2012Y 2013Y 2014Y 2015Y Total 1 Risk-Based Capital Total Risk-Based Capital 16.00% 18.00% 15.00% 12.00% 9.00% 6.00% 3.00% 2014Y 2015Y 2012Y 2013Y 2014Y 2015Y * 2013 Capital Ratios reflect t
Slide 25: Compelling Investment Highlights
Compelling Investment Highlights Knowledgeable and experienced management team of Attractive branch franchise 24
Slide 26: Data sources
The previous slides contained data from the following sources: FDIC-Insured Commercial Banks: Obtained from FDIC. gov Quarterly Banking Profile SNL