Lake Shore Bancorp, Inc. · NASDAQ:LSBK
Lake Shore Bancorp — Shareholder Meeting (May 2021)
45 slides from Lake Shore Bancorp's shareholder meeting presentation, May 19, 2021
Slide 1: Annual Shareholders' Meeting
Slide 2: Safe Harbor Statement
ANNUAL SHAREHOLDERS’ MEETING May 19, 2021 1 LAKE SHORE BANCORP, INC. 2 Safe Harbor Statement This release contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, that are based on current expectations, estimates and projections about th
Slide 3: Agenda
AKE SHORE BANCORP, | Agenda Call to Order — Kevin M. Sanvidge, Chairman . Introduction of Officers, Directors and Director Nominees + Secretary’s Report + Presentation of Proposals + Executive Management Report to Shareholders + Vote Report + Adjournment
Slide 4: Board of Directors
LAKE SHORE BANCORP, INC. 3 Agenda Call to Order – Kevin M. Sanvidge, Chairman Introduction of Officers, Directors and Director Nominees Secretary’s Report Presentation of Proposals Executive Management Report to Shareholders Vote Report Adjournment A person in a suit smiling Description automaticall
Slide 5: Senior Management Team
KE SHORE BANCORP, IN Senior Management Team Po nad ince Susan C. Ballard, EVP Retail, Sales and Marketing 2020 Janinne Fiegl Dugan, VP Human Resource Officer 1993 Rachel A. Foley, Chief Financial Officer and Treasurer 1999 Nicole May, Compliance and CRA Officer 1996 Sonia N. Ortolano, VP Information
Slide 6: Senior Management Team
LAKE SHORE BANCORP, INC. Senior Management Team Employee since Susan C. Ballard, EVP Retail, Sales and Marketing 2020 Janinne Fiegl Dugan, VP Human Resource Officer 1993 Rachel Foley, Chief Financial Officer and Treasurer 1999 Nicole May, Compliance and CRA Officer 1996 Sonia N. Ortolano, VP Informa
Slide 7: Business of Annual Shareholders Meeting, cont.
AKE SHORE BANCORP, | Business of Annual Shareholders Meeting, cont. 2. Say on Pay Proposal: Anon-binding “say on pay” proposal to approve the compensation of our named executive officers. 3. Appointment of Independent Registered Public Accounting Firm: Ratify the appointment of Baker Tilly US, LLP a
Slide 8: Executive Management Presentation
LAKE SHORE BANCORP, INC. 7 Business of Annual Shareholders Meeting, cont. 2.Say on Pay Proposal: A non-binding “say on pay” proposal to approve the compensation of our named executive officers. 3.Appointment of Independent Registered Public Accounting Firm: Ratify the appointment of Baker Tilly US,
Slide 9: Navigating to Calmer Waters
KE SHORE BANCORP, IN Navigating to Calmer Waters Community banks rose to the top by providing stellar customer service * Quick pivot to meet customers’ changing needs throughout unprecedented crisis e Previous strategic focus on “clicks vs bricks” — allowed us to provide safe and effective banking s
Slide 10: Navigating to Calmer Waters
9LAKE SHORE BANCORP, INC. Navigating to Calmer Waters Community banks rose to the top by providing stellar customer service Quick pivot to meet customers’ changing needs throughout unprecedented crisis Previous strategic focus on “clicks vs bricks” – allowed us to provide safe and effective banking
Slide 11: COVID-19 and Credit Risk
Navigating to Calmer Waters COVID-19 and Credit Risk Loan Modification Program * Implemented 2"¢ quarter 2020 * Deferral of principal and interest for 90 days, and up to 180 days or longer in some instances in accordance with regulatory guidelines * At maximum, 219 loans, representing $103.1 million
Slide 12: COVID-19 and Credit Risk
LAKE SHORE BANCORP, INC. Navigating to Calmer Waters COVID-19 and Credit Risk Loan Modification Program Implemented 2nd quarter 2020 Deferral of principal and interest for 90 days, and up to 180 days or longer in some instances in accordance with regulatory guidelines At maximum, 219 loans, represen
Slide 13: An Overview of Lake Shore
‘Chovtaugua . 5 01 1563 (28) Ene mw 6 25875 04d 0.19) Total 14 £68,001 40,702, 83.117 ose 1030 Lake Shore Savings Bank is a federally chartered, community- oriented financial institution headquartered in Dunkirk, New York, with a longstanding history of community banking since 1891 Current focus on
Slide 14: An Overview of Lake Shore
LAKE SHORE BANCORP, INC. An Overview of Lake Shore 13 Lake Shore Savings Bank is a federally chartered, community-oriented financial institution headquartered in Dunkirk, New York, with a longstanding history of community banking since 1891 Current focus on organic growth of loan portfolio primarily
Slide 15: Positioned for Growth - Financial Highlights
ls LAKE SHORE BANCORP, INC Positioned for Growth- Financial Highlights YoY QoQ FY 2020 FY 2019 Change 2021FQ1 2020FQ1 Change Assets $686,200 $610,869] 12.3% Assets $705,745 $628,226] 12.9% Net Loans $524,143 $470,816 11.3% NetLoans $538,184 $473,254 13.7% Deposits $560,259 $483,476 15.9% Deposits $5
Slide 16: Positioned for Growth - Financial Highlights
LAKE SHORE BANCORP, INC. Positioned for Growth- Financial Highlights Dollars in Thousands(except per share amounts)FY 2020FY 2019YoY ChangeAssets$686,200$610,86912.3%Net Loans$524,143$470,81611.3%Deposits$560,259$483,47615.9%Net Income$4,558$4,08711.5%Basic Earnings Per Share $0.77$0.6813.2%Book Val
Slide 17: Positioned for Growth - Deposits
Positioned for Growth - Deposits » Our focus has been on reducing our cost of funds by concentrating our efforts on growing core deposits. » Core Deposits increased 117.6% since December 31, 2013 and were 73.10% of total deposits as of March 31, 2021. ‘$660,000 ‘$600,000 ‘$660,000 ‘$600,000 ‘s460,00
Slide 18: Positioned for Growth - Deposits
LAKE SHORE BANCORP, INC. Positioned for Growth - Deposits Our focus has been on reducing our cost of funds by concentrating our efforts on growing core deposits. Core Deposits increased 117.6% since December 31, 2013 and were 73.10% of total deposits as of March 31, 2021. 17 Financial data is presen
Slide 19: Environmental, Social and Governance (ESG)
AKE SHORE BANCORP, | Environmental, Social and Governance (“ESG”) Three factors used to evaluate corporate behavior, and to improve longterm sustainability Integrated with Bank’s Mission Statement Environmental Factor * Strive towards Electronic Processing, Paperless « Research and implement more ef
Slide 20: Environmental, Social and Governance (ESG)
LAKE SHORE BANCORP, INC. Environmental, Social and Governance (“ESG”) Three factors used to evaluate corporate behavior, and to improve long term sustainability Integrated with Bank’s Mission Statement Environmental Factor Strive towards Electronic Processing, Paperless Research and implement more e
Slide 21: ESG - Corporate Governance
AKE SHORE BANCORP, INC. Environmental, Social and Governance (“ESG”) Corporate Governance « Ethical leadership and sound decision making * Corporate Mission —four pronged — customers, employee, community and shareholder focus « Focus on high performing results that drive shareholder value 24
Slide 22: ESG - Corporate Governance
LAKE SHORE BANCORP, INC. Environmental, Social and Governance (“ESG”) Corporate Governance Ethical leadership and sound decision making Corporate Mission –four pronged – customers, employee, community and shareholder focus Focus on high performing results that drive shareholder value 21 LAKE SHORE B
Slide 23: Board Member Changes
ls LAKE SHORE BANCORP, INC. Board Member Changes Retirement of David C. Mancuso, Director and former President and CEO In May 2021 Mr. Mancuso will retire, after more than 55 years of service to the bank.
Slide 24: Board Member Changes
LAKE SHORE BANCORP, INC. Board Member Changes Retirement of David C. Mancuso, Director and former President and CEO In May 2021 Mr. Mancuso will retire, after more than 55 years of service to the bank. 23 LAKE SHORE BANCORP, INC. Future Focus Commercial Loan Growth – focus on Commercial Real Estate
Slide 25: Future Focus
KE SHORE BANCORP, IN Future Focus Core System Conversion + New and innovative processing platform that will allow us to better serve our customers * Continuity of current banking features and services + Deliver a better banking experience Advanced Digital and Mobile Banking Improved Security Feature
Slide 26: Future Focus
LAKE SHORE BANCORP, INC. Future Focus Core System Conversion New and innovative processing platform that will allow us to better serve our customers Continuity of current banking features and services Deliver a better banking experience Advanced Digital and Mobile Banking Improved Security Features
Slide 27: Creating Shareholder Value - Treasury Stock Buybacks
KE SHORE BANCORP, IN Creating Shareholder Value Treasury Stock Buybacks Trends Treasury Stock Purchases $'s in Thousands $1,800 140,000 $1,600 120,000 $1,400 $1,200 ii $1,000 80,000 $800 60,000 ihe 40,000 $400 $200 20,000 $ z 2017 FY 2018 FY 2019 FY 2020FY 2021 FQ1 YTD mmm S Purchase of treasury sto
Slide 28: Creating Shareholder Value - Treasury Stock Buybacks
LAKE SHORE BANCORP, INC. Creating Shareholder Value Treasury Stock Buybacks Trends Treasury Stock Purchases $’s in Thousands 2017 FY 2018 FY 2019 FY 2020 FY 2021 FQ1 YTD $ Purchase of Treasury stock # of Shares 27 $1,800 $1,600 $1,400 $1,200 $1,000 $ 800 $600 $400 $200 $- 140,000 120,000 100,000 80,
Slide 29: Summary
ls AKE SHORE BANCORP, INC. Summary As we enter our 130 year in business, we continue to be a local bank that cares about its customers and communities. At Lake Shore Savings, that has always meant “Putting People First”. We will continue to put our customers, communities and shareholders “First”, as
Slide 30: Summary
LAKE SHORE BANCORP, INC. Summary As we enter our 130th year in business, we continue to be a local bank that cares about its customers and communities. At Lake Shore Savings, that has always meant “Putting People First”. We will continue to put our customers, communities and shareholders “First”, as
Slide 31: Total Assets
ls AKE SHORE BANCORP, INC. Total Assets Steady growth — 12.3% in 2020; exceed $700 Million as of March 31, 2021 $800,000 $7 06.7 700000 seesaw s610.0M = a $519.0M pals = scooooo | $4022M 487M seraam ———_seanam — stonpe0 = $30,000 200000 100,000 so ans ante 25 216 17 aot 29 20 102021 cavaRactiat Net
Slide 32: Total Assets
LAKE SHORE BANCORP, INC. Total Assets Steady growth – 12.3% in 2020; exceed $700 Million as of March 31, 2021 31 $482.2M$487.5M$473.4M$489.2M$519.0M$545.7M$610.9M$686.2M$705.7M$0$100,000$200,000$300,000$400,000$500,000$600,000$700,000$800,000201320142015201620172018201920201Q 2021Loans Receivable, N
Slide 33: NPLs/Total Net Loans
ls LAKE SHORE BANCORP, INC. NPLs/Total Net Loans During the last four years Lake Shore’s nonaccrual loans have consistently remained at lower levels compared to its peers 33 Financial data is presented for LakeShore's Fiscal Year Ended December 31 for each respective year. Peer deta groups are detai
Slide 34: NPLs/Total Net Loans
LAKE SHORE BANCORP, INC. NPLs/Total Net Loans During the last four years Lake Shore’s nonaccrual loans have consistently remained at lower levels compared to its peers 33 1.66%1.66%1.57%1.80%1.05%0.82%0.75%0.59%4.86%3.07%2.68%1.55%1.63%1.07%1.60%0.97%0.50%0.75%1.00%1.25%1.50%1.75%2.00%2.25%2.50%2.75
Slide 35: Deposit Growth
Deposit Growth Total Annual Deposit Growth $'s in Thousands $700,000 $600,000 $500,000 $400,000 $300,000 $200,000 $100,000 S$- 15.88% 2O16FY 2017FY 2018FY 2019FY 2020FY 2021Q1* mmm Total Deposits ($000) Annual Deposit Growth (%) Financial data is presentedtor LakeShore's Fiscal Year Ended December 3
Slide 36: Deposit Growth
LAKE SHORE BANCORP, INC. Deposit Growth 35 Financial data is presented for Lake Shore’s Fiscal Year Ended December 31 for each respective year and for the three months ended March 31, 2021. Total Annual Deposit Growth $’s in Thousands $700,000 $600,000 $500,000 $400,000 $300,000 $200,000 $100,000 $-
Slide 37: Net Interest Margin
ls LAKE SHORE BANCORP, INC. Net Interest Margin 4.00% 3.62% y 3.61% 570;3.61% 9 3.56% 3 540, 3.53% 813 5795 52% 3-58% 3. , . 3.47% 3.50% 3.44%) 3.34% 3.34% 943-29%3.29% 3.21% 3.20348.26% en 29% 3.00% 2.50% 2.00% 7 + r . r + . : 2013Y 2014Y 2015Y 2016Y 2017Y* 2018Y 2019Y 2020Y = 1Q2021 =LSBK Net Inte
Slide 38: Net Interest Margin
LAKE SHORE BANCORP, INC. Net Interest Margin 37 Financial data is presented for Lake Shore’s Fiscal Year Ended December 31 for each respective year and for the three months ended March 31, 2021. Peer data group is detailed on slide 44. * Received $202,000 in interest related to the pay-off of one no
Slide 39: Return on Average Assets
ls LAKE SHORE BANCORP, INC. Return on Average Assets 1.25% 1.00% sre 0.98% 0.75% 0.50% 0.25% | 039% oars o.00% + 2013 2014 2048 2016" 2017 2018 2019 2020 402021 —LsBk ROAA —Nredian Peer ROAA Financial data is presentedtor LakeShore's Fiscal Year Ended Deoember 31for each respective yearand forthe th
Slide 40: Return on Average Assets
LAKE SHORE BANCORP, INC. Return on Average Assets 39 Financial data is presented for Lake Shore’s Fiscal Year Ended December 31 for each respective year and for the three months ended March 31, 2021. Peer data group is detailed on slide 44. * During the fiscal year ended December 31, 2016, Lake Shor
Slide 41: LSBK Price/Volume Chart since IPO
AKE SHORE BANCORP, | LSBK Price/Volume Chart since IPO Price (s) evo — re ‘Volume (stares000's) 20.0 20 18.0 175 16.00 150 140 25 12.0 100 10.0 6 300 a 600 B 400 Oey oo oe TEE a
Slide 42: LSBK Price/Volume Chart since IPO
LAKE SHORE BANCORP, INC. LSBK Price/Volume Chart since IPO 41 Closing stock price on 5/14/2021: $14.25 4.006.008.0010.0012.0014.0016.0018.0020.00255075100125150175200Price ($)Volume (shares 000's)VolumePriceLAKE SHORE BANCORP, INC. 42 Questions and Answers
Slide 43: Vote Report
ls LAKE SHORE BANCORP, INC. Vote Report Adjournment of Annual Shareholder’s Meeting
Slide 44: Appendix: Lake Shore Peer Data
LAKE SHORE BANCORP, INC. 43 Vote Report Adjournment of Annual Shareholder’s Meeting LAKE SHORE BANCORP, INC. Appendix: Lake Shore Peer Data 44 * Financial institution is in the process of completing a second step conversion. Institution Name Ticker City, State Total Assets ($mm)Columbia Financial, I
Slide 45: Lake Shore, MHC Annual Meeting of Members
LAKE SHORE BANCORP, INC. 45 Lake Shore, MHC Annual Meeting of MembersCall to Order Introduction of Proposal to Elect Directors Tabulation of Votes Adjournment