Prime Meridian Holding Company
Prime Meridian — Q3 2024 Earnings Presentation
35 slides from Prime Meridian's earnings presentation, Oct 25, 2024
Slide 1: Investor Presentation Q3 2024
Investor Presentation Q3 2024 Zp Bi HOLDING COMPANY
Slide 2: Forward Looking Statements
FORWARD LOOKING STATEMENTS This Presentation, incling infomation incorporated herein by reference, may cota foruarélockng sctemens wihin the mearing of the Private Secures Lagaton Reform Act of 1985, Words such as ‘may “ould” “should” would,” ‘beleve”“anicpate, “estimate” “expect” intend,"‘plan, pro
Slide 3: Glossary of Terms
GLOSSARY OF TERMS + 4-21 or at 2021 ~ First Quarercf 2021 + 221 or G2 2021 Second Quarter of 2021 + 321 oF 03 2021 ~Third Quarer of 2021 + 2621 oF 08 2021 —Fouth Quarter of 2021 + 4-220" Qt 2022 First Quarter of 2022 + 02220r 02 2022 Second Quarter of 2022 + 93:220r 03 2022 Third Quarter of 2022 + 0
Slide 4: Company Profile
COMPANY PROFILE Ticker PMG (OTCOX) ‘Market Capitalization $84.0 million (as of 9/302024) eet Price /TBV 949% (as of 93022024) es Assets $9316 oe Loans, net ‘$687.1 Million ig coma a" Deposits $824.0 Mion uate 2 NPAs2Asses 026% : be lee Leverage Ratio(Company) 10.28% ages Leverage Ratio (Bank) 10.21%
Slide 5: Investment Considerations
INVESTMENT CONSIDERATIONS History of proftable operations, driven by strong organic ban growth and ore depost base Financial Y — Continued emphasis on expense management and historically stable operating efficienoy ratio Y Nel interest Margin is consistent with peer group —Corporete-banking style un
Slide 6: Profile | Management Team
PROFILE | MANAGEMENT TEAM Y Experienced management team with proven track record of franchise growth and development ¥ Community leaders who know their clients ¥ History of profitable bank operations. Sammie D. Dixon, Jr. Vice Chairman, President and Chief Executive Officer Age: | 26 years barking e
Slide 7: Corporate Culture
CORPORATE CULTURE WES) (ON) Building bankers to serve our clients and community in order to optimize shareholder value. PURPOSE Banking done right, right away. CORE AZNB + Passion— level of intense excellence and commitment beyond simply meeting requirements + Grace- high level of service with court
Slide 8: Corporate Culture: A Different Banking Model
CORPORATE CULTURE A Different Banking Model ¥ Prime Meridian Bank promotes and maintains a culture of openness and transparency to encourage exposure of team members to all aspects of banking. v Team members, executive officers and board members interact to resolve issues without the typical top/dow
Slide 9: Financial Highlights
FINANCIAL HIGHLIGHTS, Return on Average Assets ay (pars Diluted Earnings Per Share Diluted EPS ROAE ue : GAAP Q3-24 GAAP Q3-24 ee sr: ue tum Ot $1.06 16.58% oer) le a ro Diluted EPS ROAE 1 H PTPP Q3-24 PTPP 03-24 | i i 1.14% ROAA 17.58% aa ma ae GAAP Q3-24 Net Loans CAGR Re Sins lnegaagen 1.55% ROAA
Slide 10: Net Interest Drivers
NET INTEREST DRIVERS (dollars in millions and represents average period-ending balance) Average Securities Yield Average Loan Yield By 7 Le] l | I NetLoans Average Cost of Interest-Bearing Liabilities Average Cost of Funds BB Noninterest- Bearing Deposits Il Interest Bearing Liabilties | | y (oom PR
Slide 11: Building Franchise Value: Total Assets
Total Assets (n rifions) BUILDING FRANCHISE VALUE cage HI NetLoans Net Loans (Aaja (0 seenonaane Popes ‘A fnarcia a w of Deri 3 of Be especie yar Sou: SEP Goal aed Wied company Scares i INVESTORS.PRIMEMERIDIANBANK.COM | OTCQX: PMHG 11
Slide 12: Building Shareholder Value
BUILDING SHAREHOLDER VALUE Net income cacr-93% Book Value Per Share Earnings Per Share (B cacr-88% 4, 18. 0mBonin ow ack cng (oom PRIME (79 MERIDIAN NVESTOR S.PRIMEMERIDIANBANK.COM ie 12 HOLDING COMPANY
Slide 13: Strong Record of PTPP Performance (Non-GAAP)
STRONG RECORD OF PRE-TAX PRE-PROVISION (PTPP) PERFORMA E (NON-GAAP) PTPP Operating Earnings (No (oom PRIME ( MERIDIAN UES /ORS PRUNE ME RINEANE COME puis 43 HOLDING COMPANY
Slide 14: Balance Sheet — Bond Portfolio
BALANCE SHEET — BOND POR Investment Securities Segmentation Portfolio: September 30, 2024 Total Investments: $104.2 million Net Unrealized Gain (Loss) AFS: ($5.7 million) AgencymTreasuy 12.19% HMunicipas EFFECTIVE AVG AVG JARTER DURATION YIELD UFE fais 3024 424 286% = 5A Par 4.27% 2024 385 278% = 52
Slide 15: Fixed vs Variable Rate Loans
A. Fixed Rate Loans $203.0 million * Weighted Average Maturty 5.1 years A Variable Rate Loans $489.7 million * $185.7 million ST Variable Rate (0-12 Month reset) %Change in Projected Baseline Net Interest Income "$304.0 millon LY, Veitable Rate (12 Month reed) Immediate and Parallel Shock-Static Bal
Slide 16: Disciplined Credit Processes
DISCIPLINED CREDIT PROCESSES (in thousands) Granular Portfolio - Lending Exposure Limits Concentration limits set for primary v Secured Legal Limit - Bank segments of the portfoho. ¥ Secured In-House Limit v Top 25 Relationships Internal company data as of 90/2024 $ 233% $ 8,000 $171,044 + Decentral
Slide 17: CRE Commitments & Exposure
CRE COMMITMENTS & EXPOSURE (dollars in thousands) v As part of its overall risk management program, Prime Meridian Bank pursues a program of controlled growth in its Commercial Real Estate (CRE) portfolio and maintains its CRE exposure within regulatory guidelines Total Risk Based Capital-Bank $ 98,
Slide 18: Loan Portfolio
LOAN PORTFOLIO Total Loans {in millions) $484 «$573 «$634 «= $693 Loans (in thousands) Real Estate Mortgage Loans Commercial RealEstate (CRE) $ Residential Real Estate and HELOC CConstructon ‘Total Real Estate Morgage Commercial Consumerand Other Total Loans Defered LoanF ees, Net Less: ALLL Loans,
Slide 19: Residential Loan Portfolio
NTIAL LOAN PORTFOLIO Total Residential Loans (in mitions) $181 $219» $249 $298 cag aa Residential Residential Loans (in thousands) Loan Portfolio Residential Real Estate and HELOC om Composite 14OwnerOccupied’ HELOC $ Comparison 1-4 Non Owner Occupied ia Mutiamity 114 OurerOcaiied &HELOC Total al =
Slide 20: CRE Owner Occupied and Non-Owner Occupied by Type
+ CRE represents the Bank’s second largest loan category with Owner Occupied and Non-Over Occupied making up 15.2% and 16.1% of the total loan portfolio + Office accounts for 31.3% ($32.9 million) and 15.3% ($17.0 million) of Owner Occupied and Non-Owner Occupied respectively. Owner Occupied CRE by
Slide 21: Core Funding
CORE FUNDING Total Deposits (in millions, $718 $755 = $723 $824. Core Funding ¥ Company's deposit franchise is comprised Composite of 25% noninterest-bearing deposits Comparison sNerinerest Bering Deposits (in thousands) Morey Market Noninterest Bearing $ 202659 hae. MoneyMarket Accounts, 326061 Tin
Slide 22: Core Funding: Deposit Highlights Q3 2024
CORE FUNDING Deposit Highlights Q3 2024 Diversified core deposit base and balanced distribution between commercial and retail clients. ‘Average balance per account of $51,059 Non-core funding represents $67.4 million, or 10.7% of total interest-bearing liabilities. Q3-24 average cost of funds of 2.3
Slide 23: Deposits
( DEPOSITS + Average net new non-maturity deposit volume of $18.8 million, and 183 net new accounts for 3rd quarter 2024. * — Focus on noninterest-bearing and NOW accounts. + 49% year-over-year growth in the number of non-maturity deposit accounts. Net New Non-Maturity Deposit Accounts Net New Non-M
Slide 24: Liquidity and Flexibility
LIQUIDITY AND FLEXIBIL Cash and Cash [ Unpledged Debt | Available Credit | [ Maximum Available ] Equivalents Securities (FairValue) Lines Brokered + Wholesale $96.5 million + $85.1 million $197.7 milion - $232.9 million $181.6 million + $430.6 million TAL LIQUIDITY $612.2 million 74.3% of Total Depo
Slide 25: Asset Quality
1.00 0.90 0.80 0.70 0.60 0.50 0.40 0.30 0.20 0.10 0.00 0.52 (9 NPA= Nonperiorning Assets Asset Quality NPAs()/ Total Assets (%) 2020 2023 03-24 ‘Source: SEP Gcba and intemal company document, Al fnancl data as of December 31 of he respective year unless oherwise ned to PRIME MERIDIAN HOLDING MPANY I
Slide 26: Deposit Market Share
Deposit MARKET SHARE 2024 Total Deposit 2023 Total Deposit Institution State 2024 Rank 2023 Rank __ Market Share (%) _ Market Share (*6) Wels Fargo Bank NA SD Bank 1 1 1750 1744 540 Captal City Bank FL Bank 2 2 1568 723 582 ‘Bank of America NA NG Bank 3 3 15.13 1583 358 “Trust Bank NC Bank 4 4 1192
Slide 27: Appendix | Tables
Appendix | TABLES
Slide 28: Financial Highlights (unaudited)
Financial Highlights (unaudited) (dollars in thousands except per share arrourts) sg4 Qt 4g 3q23 er Share Data: sng common hee Be $ om os g 09s oss s 066 ‘Enmungs por coummon share Ded 3 om $ os $ oso $ oss $ oes ‘Book vale per common shave 5 ass $ 33s $ un $ 233 $ 2s Common shares outstanding az03s
Slide 29: Condensed Consolidated Statements of Earnings
Condensed Consolidated Statements of Earnings {in thousands except per share amounts) ‘Three Mouths Ended September 30,__Nine Months Ended September 30, 3034 “2038 034 3035 Tranied Tauaied Intcest mcome ‘Toms a 1099s sors sisss $2.88 Deb securities 737 319 2505 am Ober 92 2 1x8 60 "Tota inserest inc
Slide 30: Condensed Consolidated Statements of Earnings (unaudited)
Condensed Consolidated Statements of Earnings (unaudited) {in thousands except per share amounts) sQ24 2924 1gn4 4Q728 3Q23 Interest income ‘Loans s 1098 $ we $s 992 $ es $ 9019 Debt secunties 737 $2 6 en 319 ‘Other 32 =) 21 27 28 ‘Total interest income es Ts Tiss Ta866 Tie Interest expense Deposits
Slide 31: Condensed Consolidated Balance Sheets
Condensed Consolidated Balance Sheets (in thousands) Assets ‘Cash & cath equivalents ‘Debt secunties available for sale 3Q4 2924 1974 Casudited) Unaudited (Unaudited s goss § 087s $s 2474 90935 9798 1743 B26 13267 11861 7857 5505, 3583 67057 4702 6625 1073 1073 1588 a2 7266 7906 2654 2m 2967 3283 35
Slide 32: Results of Operations (unaudited)
Results of Operations (unaudited) (dallas in thousands) ‘Net interest income 794 $7398 Interest rate spread) 2% 20% ‘Net interest margin”) 36% 355% (@) Includes nonacerual loans (@) Other interesteamng assets include federal funds sold interest-bearing deposits and Federal Home Loan Bank stock (G) I
Slide 33: Reconciliation of Non-GAAP Disclosures
RECONCILIATION OF NON-GAAP DISCLOSURES Non-GAAP Measures and Ratio Reconciliation (Unaudited) deli in thousands except per share amurts) 34 2924 174 4Q23 3Q28 ‘NetIncome Neteamings (GAAP) s 2603 $ um $ 1931 $ 1990 $ 2120 hus: credit loss expense 100 4 m1 7 1S Phas: income taxes 5 533 cay 5a ca PTPPG
Slide 34: Reconciliation of Non-GAAP Disclosures
RECONCILIATION OF NON-GAAP DISCLOSURES Non-GAAP Measures and Ratio Reconciliation (Unaudited) deli in thousands except per share amurts) For the Vear Ended December 31, 2033 30222021 0H 7019 ‘NetIncome Neteaming: (GAAP) s ame $ se $ sus 44585 350 hus: redit loss expense 1450 $80 ao) 2850 11 Pht inco
Slide 35: Reconciliation of Non-GAAP Disclosures
RECONCILIATION OF NON-GAAP DISCLOSURES Non-GAAP Measures and Ratio Reconciliation (Unaudited) deli in thousands except per share amurts) For the Year Ended December 31 Tons 20m 2021 om co Adjusted Average Loan Yield: Net loans, excluding loans held forsale S$ I$ SBRTIS $US S$ KHL $87.10 Less PPP loa
Prime Meridian Holding — Q3 2024 Earnings Presentation on 6ix