Summit State Bank · NASDAQ:SSBI

Summit State Bank — Q4 2024 Earnings Presentation

30 slides from Summit State Bank's earnings presentation, March 2025

1. Slide 1: Investor Presentation Q4 2024

   Investor Presentation Q4 2024 1

2. Slide 2: Company Overview

   Company Overview  Summit State Bank is a commercial bank headquartered in Santa Rosa, CA with $1.1 billion in assets, 5 branch locations and more than 106 employees  Bank formed in 1982  Listed on NASDAQ in 2006 under the ticker symbol “SSBI”  Summit Way Service Standards -Dedicated to serving a

3. Slide 3: Summit State Bank Locations

   Summit State Bank Locations Headquartered in Santa Rosa, CA Branch Locations  Santa Rosa Main  Healdsburg  Santa Rosa Montgomery Village  Rohnert Park  Petaluma Regional Small Business Lending Group  HQ in Roseville, CA 3

4. Slide 4: Market Area Highlights

   Market Area Highlights Northern California Concentrated in Sonoma County  Commercial Property Investment Inventory Remains Low due to limited construction over the past ten years.  Diverse and Strong Economy:  Healthcare, Manufacturing, Construction and Wholesale Trade Comprise > 40% of the Count

5. Slide 5: Our Leadership Team

   Our Leadership Team Brian Reed Genie Del Secco Brandy Seppi Camille Kazarian Michael Floyd President & CEO EVP & Chief Operating Officer EVP & Chief Lending Officer EVP & Chief Financial Officer EVP & Chief Credit Officer 40 Years in the Industry 34 Years in the Industry 31 Years in the Industry 25

6. Slide 6: Loan Growth & Asset Quality

   Loan Growth & Asset Quality  2024 Loan growth has slowed due to focus on quality and appropriate rate in a highly competitive market  Strong Reserves at 1.49% (Allowance for Loans & Lease Losses – ACL)  Elevated Non-Performing Loans are primarily comprised of a group of large relationships that a

7. Slide 7: Non-Performing Loans and Loan Loss Reserve

   Non-Performing Loans and Loan Loss Reserve Non-Performing Loans:  3 specific relationships make up 94% of non-performing assets as of Q4 2024  $2.2MM of specific reserves set aside for all Impaired loans  General pool reserves remain at 1.30% (excluding specific relationships)  Historically, act

8. Slide 8: Non-Performing Loans

   Non-Performing Loans Bank Balance % of Non- Industry Specific Reserve Expected Status at Q4 ($000) Performing Loans at Q4 2024 ($000) Resolution 2024 In Contract to Winery Credit #1 $9,993 36% $0 Q1 2025 Sell Agriculture Credit #2 $8,108 29% $345 TBD In Bankruptcy Agriculture In Contract to Credit #

9. Slide 9: Portfolio Delinquency Trends

   Portfolio Delinquency Trends Delinquency Trends:  Delinquency metrics of the performing portfolio have been declining in recent periods  Past Due segment is currently <0.5% of the portfolio *excludes Non-Accrual loans 9

10. Slide 10: Interest Income & Interest Expense Management

    Interest Income & Interest Expense Management  NIM compression and Net Interest Income decline due to elevated cost of funds, lower volume of new higher priced loans and existing loans that have repriced slower than deposits  Starting in Q3 2024, NIM and Net Interest Income compression is improvin

11. Slide 11: Yield on Earning Assets vs Cost of Liabilities

    Yield on Earning Assets vs Cost of Liabilities  Cost of Liabilities has risen faster than the Yield on Earning Assets  Cost of Liabilities has peaked in Q3 2024 11

12. Slide 12: Deposits & Loans Repricing by Maturity

    Deposits & Loans Repricing by Maturity  Majority of Interest-bearing Deposits may reprice within 1 year  Only 24% of the Loan Portfolio contractually reprices within 1 year  Reprices Immediately  Reprices quarterly  Reprices in 1 month to 1 year  Reprices 1 year+  Fixed Rate 12

13. Slide 13: Treasury Indexed CRE – Contracted Rate Resets

    Treasury Indexed CRE – Contracted Rate Resets  Most Treasury Indexed CRE Loans reprice every 5 years based on the corresponding Constant Maturity Treasury index  Repriced rates reflect a snapshot of market rates as of 12/31/2024; Actual repricing rates can differ depending on market rates at the t

14. Slide 14: Government Guaranteed Loan Programs

    Government Guaranteed Loan Programs  Dedicated Small Business Lending Group Created in 2017  Floating Rate Yields ~ 9.4% (Jan 2025 adjustment)  Decrease in Non-Interest Income through:  Lower SBA Loan Sales Volume and Premiums  Offset by increasing Servicing income  Decreased Retained Balance

15. Slide 15: Managing Infrastructure Costs in an Inflationary Environment

    Managing Infrastructure Costs in an Inflationary Environment  Operating expenses in FY 2024 were held flat at $25.3MM vs $25MM is FY 2023, as cost cutting was initiated offsetting inflationary pressures  One-time Goodwill expense $4.1MM excluded  Cost cutting efforts employed in Q4 2024 will impa

16. Slide 16: Financial Trends

    Financial Trends  Net Interest Income decreased from $35.5MM FY 2023 to $29.5MM FY 2024  Non-Interest Income decreased from $5.2MM FY 2023 to $3.5MM FY 2024  Operating Expenses held flat from $25MM FY 2023 to $25.3MM FY 2024 (excluding one-time Goodwill write-down), due to cost cutting measures 

17. Slide 17: Net Operating Income

    Net Operating Income  Net Operating Income = Net Income before loss provision and taxes (excluding Goodwill write-down, OREO valuation adjustment)  Net Operating Income impacted in Q4 2024 with multiple one-time expenses:  Write down of Goodwill ($4.1MM)  Reduction in Valuation of OREO 17 ($700M

18. Slide 18: Assets Trends

    Assets Trends  Focused Growth on Owner Occupied Conventional CRE and C&I Loans with Targeted Yield at 7.35%  Focus on SBA Guaranteed Loans with Targeted Yield at 9.68%  Portfolio Loan Yield as of 2024Q4 at 5.97%  $492MM of Treasury based loans are scheduled to reprice in the next 3 yrs at a diff

19. Slide 19: Loan Portfolio Composition

    Loan Portfolio Composition Portfolio Product Types, % Commercial Real Estate - Invest ▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬● 48.9% Commercial Real Estate - Owner Occupied ▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬▬● 25.1% Total Farm ▬▬▬▬▬▬▬▬● 8.5% Loan Commercial C&I ▬▬▬▬▬▬● 6.8% Diversified Portfolio with

20. Slide 20: Loan Composition

    Loan Composition Total Loan Portfolio CRE Loan Portfolio Concentration: Investment & Owner Occupied 20

21. Slide 21: Liabilities Trends

    Liabilities Trends  Continued Focus on Managing Local Non-Maturity Deposit Growth to match Loan Growth  Deposit growth from 2018 to 4Q2024:  Local Non-Maturity Deposits went from 57% to 68% of Total Deposits  Total Local Deposits went from 89% to 93% of Total Deposits 21

22. Slide 22: Deposit Composition

    Deposit Composition  Organic Deposit Growth through Strong Relationship Practices  Focused Local Deposit Growth  4Q2024 Average Cost of Deposits at 2.93% 22

23. Slide 23: Focus on Liquidity and Quality as of Q4 2024

    Focus on Liquidity and Quality as of Q4 2024  111MM of Available Primary Liquidity  Including Cash and Investments Available for Sale  Primary Liquidity is 11%  $344MM of Available Secondary Lines  Including FHLB, Federal Reserve Bank, and Fed Funds lines  Total Liquidity (Primary + Secondary

24. Slide 24: Tangible Book Value Growth

    Tangible Book Value Growth  Tangible Book Value has improved 47% since 2018, or 8% annualized growth  Tangible Book Value growth has solely been driven by retention of earnings  As of March 24, 2025, the Bank’s stock price was trading at 0.72x of Book Value 24

25. Slide 25: Investor Stock Value

    Investor Stock Value Graph illustrates investment in 1 share of stock beginning in 2016  2016: One share of stock purchased  2017: A five-for-four stock split results in 1.25 shares outstanding  2021: A one time 10% stock dividend results in 1.38 shares outstanding  Stock Value increased 28% sin

26. Slide 26: Dividend Return

    Dividend Return Graph illustrates annual cash dividend returns on 1 share of stock beginning in 2016  Dividend on Initial Investment relates to the original purchase of 1 share  Additional Dividend Return of 37.5% is a result of:  5-for-4 stock split (2017)  one time 10% stock dividend (2021) 

27. Slide 27: Awards and Accolades

    Awards and Accolades Best Places to Work North Bay Business Journal Corporate Philanthropy Award SF Business Times Hall of Fame North Bay biz magazine Diversity in Business 27

28. Slide 28: Why Summit State Bank?

    Why Summit State Bank?  Experienced Executive & Management Team  Commitment to a Culture of Success  Focus on Organic Growth and Driving Core Customer Deposits  Strategic Lending Platform Positioned to Deliver Results  Significant Growth in Tangible Book Value of shares in last 5 years  Experi

29. Slide 29: Forward-Looking Statements

    Forward-Looking Statements This presentation includes forward-looking statements within the meaning of the “safe-harbor” provisions of the Private Securities Litigation Reform Act of 1995, including forward-looking statements regarding our expectations and beliefs about our future financial performa

30. Slide 30: Mailing Address and Contact

    MAILING ADDRESS 500 Bicentennial Way Santa Rosa, CA 95403 CONTACT Barbara Gradman VP, Corporate Secretary bgradman@summitstatebank.com (707) 568 6000 30

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