Primis Financial Corp. · NASDAQ:FRST
Primis Financial — Q1 2022 Earnings Presentation
23 slides from Primis Financial's earnings presentation, Apr 28, 2022
Slide 1: First Quarter 2022
First Quarter 2022 NASDAQ: FRST Exhibit 99.2
Slide 2: Forward-looking statements
This presentation and certain of our other filings with the Securities and Exchange Commission contain statements that constitute “forward-looking statements” within the meaning of, and subject to the protections of, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Secur
Slide 3: Non-GAAP Measures
Statements included in this presentation include non-GAAP financial measures and should be read along with the accompanying tables. Primis uses non-GAAP financial measures to analyze its performance. The measures entitled pre-tax pre-provision operating earnings from continuing operations; pre-tax p
Slide 4: Welcome to Primis
A pioneering bank, committed to imagining a faster and more convenient way to serve you. WELCOME TO PRIMIS Corp. Headquarters: Bank Headquarters: Branches: Ticker (NASDAQ): Valuation Market Capitalization: Price / Book Value per Share Price / Tangible Book Value: Price / 2022 Estimated EPS(3): Price
Slide 5: Proposed Acquisition of SeaTrust Mortgage Company
Proposed Acquisition of SeaTrust Mortgage Company 5 Founded in late 2019 / Began production February 2020 Experienced management team (remaining with Primis) FHA and Fannie approved 2021 production of $255 million / 2022 estimated production of $300 million Closing expected in Q2’22, subject to clos
Slide 6: High Performing Community Bank
High Performing Community Bank 6 Continued focus on improving deposit mix and lowering cost of deposits Solid loan growth in our core markets with 10.7% annualized loan growth in Q1* Consolidating 6 branches in Q2’22 and 2 branches in Q3’22 Cost of Deposits: 35 bps Cost of Deposits: 60 bps Deposit C
Slide 7: Digital Bank Update
Digital Bank Update 7 Final testing for imminent public launch Initial products will include consumer and business deposit accounts with novel features Significant debit card rewards Free overdraft Embedded V1BE functionality Build out small-business offerings, including lending Leverage platform to
Slide 8: Panacea Financial Update
8 $31.0 million growth in loan balances in Q1 Q1’22 originations of $35.7 million, pacing at the high end of 2022 growth expectations despite student loan payments deferral extensions Achieved pre-provision profitability in March, well ahead of schedule Banking >1,400 doctor households across all 50
Slide 9: Life Insurance Premium Finance Update
4 9 Life Insurance Premium Finance Update Key Portfolio Metrics Key Performance Metrics Average Actual Primis Processing Time is ~4 Days Placement Ratio Carrier Approvals Top-Tier Partners Distribution Partners 86% 19 24 4 76% 180% Loan Balance Growth and Deal Growth Respectively 3.28% Weighted Aver
Slide 10: First Quarter Results
First Quarter Results
Slide 11: Q1 2022 results highlights
Net income from continuing operations of $4.6 million or $0.19 per basic and diluted share Gross loans, excluding PPP balances, grew approx. 18% annualized with solid contribution from across the organization Total deposits declined slightly linked-quarter to $2.69 billion from $2.76 billion while m
Slide 12: Balance Sheet Trends
Dollars in millions. (1) See reconciliation of Non-GAAP financial measures on slide 23. Balance Sheet Trends 12 $3,330 $2,689 $2,392 9.01% Q1'21 $3,395 $2,751 $2,286 9.12% Q2'21 $3,452 $2,807 $2,315 9.02% Q3'21 $3,407 $2,763 $2,340 9.26% Q4'21 $3,220 $2,686 $2,394 Q1'22 Gross Loans deposits total as
Slide 13: Loan Composition and Trends
Dollars in millions. Loan Composition and Trends 13 Loan Composition (Ex. PPP) Robust loan growth of 4.4%, or 17.6% annualized, linked-quarter excluding PPP balances Continue to anticipate mid- to high-teens loan growth for 2022, excluding PPP balances $335 4.82% Q1'21 $2,056 4.47% Q2'21 $234 4.46%
Slide 14: Asset Quality
Classified loans and NPAs exclude guaranteed portion of SBA loans. Asset Quality 14 NPAs / Loans (Ex. PPP) + OREO NCOs / Average Loans Criticized & Classified Loans / Total Loans (Ex. PPP) Criticized assets continue to remain at moderate levels with substandard loans declining and nonperforming loan
Slide 15: Allowance for Credit Losses
Classified loans exclude guaranteed portion of SBA loans. Allowance for Credit Losses 15 ACL / Gross Loans (Ex. PPP) ACL / Classified Loans Provision for credit losses of $0.1 million in Q1 versus recovery of $1.3 million in Q4 as economic forecasts soften slightly and loan growth continues at a rob
Slide 16: Deposit Trends
Dollars in millions. (1) Core deposits exclude time deposits. Deposit Trends 16 Deposit Composition – Q1’22 Core Deposit Growth (1) Total deposits declined slightly in Q1, largely due to $103 million decrease in balances associated with mortgage escrows Anticipate this account will refund in Q2 Focu
Slide 17: Margin Progression
Margin Progression Dollars in millions. (1) See reconciliation of Non-GAAP financial measures on slide 23 Net Interest Income and Net Interest Margin 17 Excluding PPP impacts, Q1’22 was the fourth consecutive quarter of increasing net interest income and third consecutive quarter of margin expansion
Slide 18: Non-interest expense and efficiency
Q1 NIE, excluding unfunded commitment expense, essentially flat from Q4 Reduced consulting/legal/marketing expenses were offset by planned expenses tied to growth initiatives Legal expenses related to SeaTrust transaction of $115K in Q1 Expenses related to Panacea/Life Premium Finance/Digital increa
Slide 19: Profitability
Dollars in millions. (1) Results from continuing operations. (2) See reconciliation of Non-GAAP financial measures on slide 23. Profitability 19 Return on Average Assets Pre-Tax Pre-Provision Earnings (1) Operating leverage expected to drive improving profitability as excess liquidity is deployed in
Slide 20: Per Share Results
Tangible Book Value Per Share Diluted Earnings Per Share from Continuing Operations (1) See reconciliation of Non-GAAP financial measures on slide 23. Per Share Results 20 (1) Tangible book value per share adversely impacted by $10.6 million change in unrealized mark-to-market adjustments on the Com
Slide 21: Summary
Talented management team and board committed to building long-term shareholder value Attractive multi-pronged strategy for growth Aggressive and early use of technology positioning the bank for superior performance as the industry evolves Significant valuation upside as strategic investments mature
Slide 22: Appendix
Appendix 22
Slide 23: Non-GAAP Reconciliation
*Net interest margin excluding the effect of PPP loans assumes a funding cost of 35 bps on average PPP balances in all applicable periods. Non-GAAP Reconciliation 23 Primis Financial Corp. (Dollars in thousands, except per share data)For Three Months Ended:Reconciliation of Non-GAAP items:1Q 20224Q