Slide 1: ACNB Corporation Annual Meeting of Shareholders May 2, 2023
ACNB Corporation Annual Meeting of Shareholders May 2, 2023 1
Slide 2: Welcome & Introductions
Welcome & Introductions Alan J. Stock Chairman of the Board 2
Slide 3: Board of Directors
Board of Directors Alan J. Stock Chairman of the Board Todd L. Herring Vice Chairman of the Board Kimberly S. Chaney Frank Elsner, III James P. Helt Scott L. Kelley James J. Lott Donna M. Newell Daniel W. Potts D. Arthur Seibel, Jr. 3
Slide 4: James P. Helt, President & CEO
James P. Helt, President & CEO 4
Slide 5: Retirements
Retirements Lynda L. Glass – Mrs. Glass retired with 39 years of service to the organization on March 31, 2023. Tom N. Rasmussen – Mr. Rasmussen is retiring with a successful 40 year banking career on May 31, 2023. David L. Sites – Mr. Sites was a member of both the Corporation’s and ACNB Bank’s Boa
Slide 6: Welcome Subsidiary Executive Officers
Welcome Subsidiary Executive Officers Mark E. Blacksten – Mr. Blacksten joined the ACNB Bank Executive Management Team in March of 2023 as the Executive Vice President/Maryland Market President. Brett D. Fulk – Mr. Fulk joined the ACNB Bank Executive Management Team in September of 2022 as the Execu
Slide 7: Executive Management Team
Executive Management Team Laurie A. Laub EVP/Chief Credit & Operations Officer Douglas A. Seibel EVP/Chief Lending & Revenue Officer Jason H. Weber EVP/Treasurer & Chief Financial Officer 7 Emily E. Berwager SVP/Human Resources Manager Kevin J. Hayes SVP/General Counsel, Secretary & Chief Governance
Slide 8: Business Unit Subsidiary and Executive Officers
Business Unit Subsidiary and Executive Officers Mark P. Bernier SVP/Wealth Management Officer 8 Mark A. Westcott President & Chief Executive Officer
Slide 9: Legal and Accounting Advisors
Legal and Accounting Advisors Partner Nicholas Bybel, Jr., Esquire Jason Stockton and Layla Mooradian 9 Bybel Rutledge LLP: Crowe LLP:
Slide 10: Meeting Agenda
• Call to Order, Quorum & Business Matters • Management Presentation • Shareholder Questions & Answers • Voting Results from Judge of Election • Adjournment Meeting Agenda 10
Slide 11: Rules of Conduct and Procedures
In the interest of an orderly Annual Meeting of Shareholders for ACNB Corporation, please honor the following basic Rules of Conduct and Procedures. • Shareholders should not address the Meeting until recognized by the Chairman of the Meeting. Upon recognition by the Chairman, the shareholder will h
Slide 12: Forward-Looking Statements
During the course of this presentation, there may be projections and forward - looking statements regarding events or the future financial performance of ACNB Corporation . We wish to caution you that these forward - looking statements involve certain risks and uncertainties, including a variety of
Slide 13: Call to Order, Quorum & Business Matters
Call to Order, Quorum & Business Matters 13
Slide 14: Management Presentation
Management Presentation James P. Helt, President & CEO Jason H. Weber, EVP/Treasurer & Chief Financial Officer 14
Slide 15: Executive Summary
1. Source: S&P Capital IQ as of March 31, 2023. 2. Source: April 27, 2023 ACNB Corporation Press Release Executive Summary Source: 10K as of December 31, 2022 unless otherwise noted. 15 • Approximately $ 46 million in gross premium volume and $ 8 . 3 million in gross commissions . • 2 office locatio
Slide 16: Market Overview
Market Overview 1. Source: FDIC Deposit Market Share Report as of June 30, 2022. 2. These market areas include Gettysburg, Upper Adams, Littlestown, McSherrystown, Carroll Valley, East Berlin, and Newville. 3. These market areas include New Oxford, Newville, East Berlin, Dillsburg, and York. • ACNB
Slide 17: Overview of 2022 Results
Overview of 2022 Results • Record year in net income, an increase of approximately 28% from 2021. • Higher interest rates, change in earning assets and lower funding costs driving the increase in net interest income year - over - year. • Stable to improving asset quality. • Year - over year lower fe
Slide 18: Balance Sheet Trends
1. Compounded Annual Growth Rate (CAGR). 2. Non - GAAP financial measure. Refer to the calculation on the page titled “Reconciliation of Non - GAAP Measures” at the end of thi s presentation. Balance Sheet Trends Source: ACNB Public filings and Internal Documents. 18 1,647.7 1,720.3 2,555.4 2,787.0
Slide 19: Performance Over Time
60.05 59.79 57.87 61.82 55.81 2018 2019 2020 2021 2022 1. EPS and ROAE for 2020 are adjusted to reflect figures that exclude after - tax merger related charges of $4.6mn for Frederick Coun ty acquisitions (non - GAAP). 2. Non - GAAP financial measure. Refer to the calculation on the page titled “Rec
Slide 20: Diversified Loan Portfolio
Diversified Loan Portfolio 20 1. Compounded Annual Growth Rate (CAGR). Source: ACNB Public filings and Internal Documents. • ACNB asset quality measures continue to reflect commitment to sound credit risk management, including conservative disciplined underwriting practices, timely credit administra
Slide 21: Prudent Reserve Discipline
For the Year Ended December 31, In $000s unless otherwise stated 2018 2019 2020 2021 2022 Loan Loss Reserve Loan Loss Reserves—Beginning of Period 13,976 13,964 13,835 20,226 19,033 Less: Charge-offs (1,810) (917) (2,987) (1,318) (1,286) Add: Recoveries 178 188 238 75 114 Add: Provision Expense 1,62
Slide 22: Healthy Deposit Portfolio
Healthy Deposit Portfolio 22 • Year - end 2022 deposits of $2.2 billion decreased 9.4% over 2021 as customers sought higher yielding alternative investment or deposit products as market interest rates rose during 2022. • ACNB continues to have a strong core deposit base, with core deposits making up
Slide 23: Strong Capital Position
0.00% 2.00% 4.00% 6.00% 8.00% 10.00% 12.00% 14.00% 16.00% 18.00% 20.00% Tier 1 Leverage CE Tier 1 Tier 1 Risk Based Total-Risk Based Regulatory Minimums Excess² 0.00% 2.00% 4.00% 6.00% 8.00% 10.00% 12.00% 14.00% 16.00% 18.00% 20.00% Tier 1 Leverage CE Tier 1 Tier 1 Risk Based Total-Risk Based Regula
Slide 24: Ample Liquidity
Ample Liquidity 24 • Actively monitoring and projecting our liquidity needs to minimize our liquidity risk ; Liquidity monitored daily. • On - balance sheet liquidity primarily comprised of cash/cash equivalents and unencumbered securities that represented ~18.0% of assets, or ~$445 million. • ACNB’
Slide 25: Total Shareholder Return: 1-Year
Total Shareholder Return: 1 - Year 25 Source: S&P Capital IQ Pro Note: S&P Small Cap Bank index comprised of all public banks (any exchange) $250M - $1BN in market capitalization. (25.0%) (5.0%) 15.0% 35.0% Dec-21 Jan-22 Feb-22 Mar-22 Apr-22 May-22 Jun-22 Jul-22 Aug-22 Sep-22 Oct-22 Nov-22 Dec-22 AC
Slide 26: Total Shareholder Return: 5-Year
Total Shareholder Return: 5 - Year 26 Source: S&P Capital IQ Pro Note: S&P Small Cap Bank index comprised of all public banks (any exchange) $250M - $1BN in market capitalization. ...and outperformed the small cap bank index and broad market indices over the past 5 years. (50.0%) (25.0%) 0.0% 25.0%
Slide 27: 2023 First Quarter Financial Highlights
2023 First Quarter Financial Highlights » Net Income = $9mm / an increase of 37% YOY » EPS = $1.06 / an increase of 39% YOY » Tangible Book Value Per Share = $23.66 compared to $22.37 for the prior quarter » Return on Average Assets = 1.50% » Return on Average Equity = 14.58% » Net Interest Margin =
Slide 28: Wealth Management
Wealth Management At Year - End in Thousands of Dollars • ACNB’s W ealth M anagement business derives a majority of its revenue from noninterest income consisting of trust, investment advisory and brokerage, and other servicing fees. • Wealth Management clients are located largely within the Bank’s
Slide 29: ACNB Insurance Services, Inc.
ACNB Insurance Services, Inc. At Year - End in Thousands of Dollars • January 2022 rebranding of insurance subsidiary to ACNB Insurance Services, Inc. from Russell Insurance Group, Inc. • February 2022 acquisition of Hockley & O’Donnell Insurance Agency, Gettysburg, Pennsylvania. It is our intent to
Slide 30: At the Heart of Community Life
FCB Bank Community Shred Event United Way Day of Caring York Adams Heart Walk Adams County Library FunFest Amazing Kids Club Festival FCB Bank Children’s Book Drive NWSB Bank Food Drive ACNB Bank School Supply Drive At the Heart of Community Life...... This is community banking! 30
Slide 31: ACNB Bank Volunteer of the Year Award
Gary W. Rappoldt , Senior Vice President/Regional Commercial Lending Manager, was presented with the 2023 Volunteer of the Year Award based on his volunteer service in 2022. ACNB Bank Volunteer of the Year Award Created to recognize exemplary community service by a Bank staff member Winner receives:
Slide 32: Brand Alignment: Where We Are & Where We're Going
Brand Alignment WHERE WE ARE & WHERE WE’RE GOING
Slide 33: Who We Are Is Our Brand
There will always be others who do what we do. WHO WE ARE IS OUR BRAND There will always be others who offer what we offer. There will never be others who are who we are. 33
Slide 34: Q1 Banking Events from the View of ACNB
» Is it a systemic risk? • The banks that have failed operated at the extremes with very specific business models • They were NOT traditional Community Banks • This is a crisis of some banks / It is not a crisis of the banking system » Concerns center around Uninsured Deposits / Liquidity / Capital
Slide 35: Q1 Banking Events from the View of ACNB
Q1 Banking Events from the view of ACNB » At ACNB, we made a decision in 2022 and so far in 2023 to restrain deposit rates for the following reasons: • Excessive balance sheet liquidity remaining from the pandemic • Loan to Deposit Ratio <70% • Softening Loan Demand due to fear of recession » As of
Slide 36: Maximizing Shareholder Value
As a community banking organization, we believe that we must consistently strive to maximize shareholder value by : 36 1. The importance of protecting our company from unknown impacts such as the Pandemic or Economic disruptions. We are focused on managing not only the short term impacts such as Cap
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Slide 38: Shareholder Questions & Answers
Shareholder Questions & Answers 38
Slide 39: Voting Results from Judge of Election
Voting Results from Judge of Election 39
Slide 40: Thank You & Meeting Adjournment
Thank You & Meeting Adjournment Stock Symbol: ACNB (Nasdaq) www.acnb.com 40
Slide 41: Reconciliation of Non-GAAP Measures
This presentation contains financial measures determined by methods other than in accordance with accounting principles generally accepted in the United States (GAAP) . The Company has presented the following non - GAAP financial measures because it believes that these measures provide useful and co
Slide 42: Reconciliation of Non-GAAP Measures
42 Reconciliation of Non - GAAP Measures Dollars in thousands, except per share figures 2022 2021 2020 2019 2018 Common shareholders’ equity (tangible), per share Shareholders’ equity $ 245,042 $ 272,114 $ 257,972 $ 189,516 $ 168,137 Less: Goodwill and intangible assets (54,517) (48,209) (49,373) (2