Choiceone Financial Services, Inc. · NASDAQ:COFS
Choiceone Financial Services — Shareholder Meeting (May 2024)
30 slides from Choiceone Financial Services's shareholder meeting presentation, May 29, 2024
Slide 1: ChoiceOne 2024 Annual Meeting
C h OICe 2024 Annual AA a eC Meeting FINANCIAL SERVICES, INC. ST ah
Slide 2: Agenda: 37th Annual Shareholder Meeting
2 AGENDA 37 TH ANNUAL SHAREHOLDER MEETING INTRODUCTIONS • Jack Hendon, Chairman of the Board CALL TO ORDER & PRESENTATION OF PROPOSALS IN PROXY STATEMENT • Election of Directors • Advisory approval of ChoiceOne’s Executive Compensation • Ratification of the selection of Plante & Moran, PLLC as indep
Slide 3: Forward-Looking Statements
3 FORWARD - LOOKING STATEMENTS This presentation contains forward - looking statements that are based on management ’s beliefs, assumptions, current expectations, estimates and projections about the financial services industry, the economy, and ChoiceOne . Words such as “anticipates,” “believes,” “e
Slide 4: Vision and mission
4 Our vision is to be the best bank in Michigan. Our mission is to provide superior service, quality advice, and show utmost respect to everyone we meet.
Slide 5: Company Profile
5 Source: Numbers based on ChoiceOne internal data as of 12/31/2023 except where specifically identified Note: All dollars in millions COMPANY PROFILE ChoiceOne Bank maintains the community feel of a small - town bank with the technological capabilities and product offerings of a larger bank ChoiceO
Slide 6: Awards & Accomplishments
6 AWARDS & ACCOMPLISHMENTS With an abundance of accolades & awards, ChoiceOne Bank has been recognized as a top - tier community bank in Michigan and in the banking industry. Award Nominee ( West MI Hispanic Chamber of Commerce – 2018 ) “ChoiceOne has a special culture, one that is driven by innovat
Slide 7: Slide 7
Slide 8: chcice@ne % , +
ae = ~ p . = chcice@ne % , +
Slide 9: Slide 9
Slide 10: 2023 Community Donations and Staff Volunteer Hours
$ 301,031 2023 COMMUNITY DONATIONS 4,307 2023 STAFF VOLUNTEER HOURS
Slide 11: 2023 Board of Directors
11 2023 CHOICEONE BANK AND CHOICEONE FINANCIAL SERVICES, INC. BOARD OF DIRECTORS FRONT ROW (L - R) ERIC E. BURROUGH CEO, Jams Media, LLC President, Web Press of Michigan, Inc. GREGORY A. MCCONNELL Vice Chairman of the Board, Retired Insurance Agent JACK G. HENDON Chairman of the Board, Certified Pub
Slide 12: Management Team
12 MANAGEMENT TEAM Mr . Michael J . Burke Jr . has served as President at ChoiceOne since May 2020 and oversees lending and operations . Previously, he served as President, CEO, COO and Director at Lakestone Bank & Trust which was merged into ChoiceOne . Mr . Burke is highly involved in organization
Slide 13: Management Team (cont.)
13 MANAGEMENT TEAM (CONT.) Ms . Heather D . Brolick has been Chief Human Resources Officer of ChoiceOne Bank since October 2020 following its acquisition of Community Shores Bank Corporation . Ms . Brolick served as Director, President and Chief Executive Officer of Community Shores Bank Corporation
Slide 14: Geographic Footprint
14 Source: S &P Capital IQ Pro, as of 6/30/2023 Note: All dollars in thousands (1) Other MI includes branches not located in an MSA, including those in the cities of Fremont, Grant and Newaygo GEOGRAPHIC FOOTPRINT GRAND RAPIDS - KENTWOOD, MI 10 Locations $755,651 Deposits 2.57% Market Share 11 Marke
Slide 15: M&A History
15 Source: Numbers based on ChoiceOne internal data as of 12/31/2023 except where specifically identified Note: All dollars in millions, unless otherwise noted; deals sorted by announcement date (1) Excludes $138.0 million and $33.1 million in PPP loans in 2020, 2021 respectively M&A HISTORY COFS ha
Slide 16: Year Comparison of Fed Funds Rate and 10-Year Treasury
16 5 YEAR COMPARISON OF FED FUNDS RATE AND 10 - YEAR TREASURY 0.00% 1.00% 2.00% 3.00% 4.00% 5.00% 6.00% 10 year Treasury Fed Funds
Slide 17: Financial Summary
F INANCIAL SUMMARY
Slide 18: 5 Years Adjusted Net Income
18 $7,100 $15,600 $22,000 $23,600 $21,300 $1,800 $2,700 $0 $5,000 $10,000 $15,000 $20,000 $25,000 2019 2020 2021 2022 2023 5 YEARS ADJUSTED NET INCOME *Tax - effected merger expenses refers to expenses related to the merger with County Bank Corp. effective on October 1, 2019, and the acquisition of
Slide 19: Historic Balance Sheet Growth
19 Source: Numbers based on ChoiceOne internal data as of 12/31/2023 exc. where spec. identified; Note: All dollars in thousands (1) Includes $138.0 million, $33.1 million and $0 million in PPP loans in 2020, 2021 and 2022, respectively (2) Core loans - exclude Paycheck Protection Program (“PPP”) lo
Slide 20: Financial Performance Trends
20 Source: Numbers based on ChoiceOne internal data as of 12/31/2023 except where specifically identified (1) Net interest margin (tax - equivalent basis). See Non - GAAP reconciliation FINANCIAL PERFORMANCE TRENDS – COFS Efficiency Ratio & Noninterest Expense to Average Assets NIM (1) ROAE ROAA 0.8
Slide 21: Attractive Deposit Mix
21 Source: Numbers based on ChoiceOne internal data as of 12/31/2023 except where specifically identified Note: All dollars in thousands (1) Saving accounts include MMDA’s ATTRACTIVE DEPOSIT MIX – CHOICEONE BANK ▪ Diverse local deposit franchise of retail, business, and municipal accounts ▪ Launched
Slide 22: Attractive Loan Mix
22 Source: Numbers based on ChoiceOne internal data as of 12/31/2023 except where specifically identified Note: All dollars in thousands; yields are annualized on a quarterly basis (1) Detail by types per call report codes ATTRACTIVE LOAN MIX – CHOICEONE BANK ▪ Strong commercial real estate portfoli
Slide 23: Asset Quality
23 Source: Numbers based on ChoiceOne internal data as of 12/31/2023 except where specifically identified (1) Excluding held for sale loans ASSET QUALITY – COFS Historically strong credit metrics Net Charge - Offs / Average Loans NPLs / Loans (1) Texas Ratio NPAs / Total Assets 0.53% 0.44% 0.24% 0.1
Slide 24: Strong Risk Management
24 Source: Numbers based on ChoiceOne internal data as of 12/31/2023 except where specifically identified STRONG RISK MANAGEMENT ▪ ChoiceOne uses interest rate swaps as part of our interest rate risk management strategy . ChoiceOne has pay - fixed interest rate swaps with a total notional value of $
Slide 25: Capital
25 Source: Numbers based on ChoiceOne internal data as of 12/31/2023 except where specifically identified (1) See Non - GAAP Reconciliation CAPITAL Regulatory Ratios Minimum Requiredto be Well Minimum Required Capitalized Under for Capital Prompt Corrective (Dollars in thousands) Adequacy Purposes A
Slide 26: Cash Dividends Per Share
26 $0.40 $0.50 $0.60 $0.70 $0.80 $0.90 $1.00 $1.10 2019 2020 2021 2022 2023 CASH DIVIDENDS PER SHARE Ordinary dividends Special dividend p aid in connection with the merger with County Bank Corp. 3.6% dividend yield as of 12/31/23
Slide 27: COFS Trades on the NASDAQ
27 C OF S T R ADES ON TH E NAS D A Q ® ChoiceOne trades on the NASDAQ S t ock E x change under its s ymbol, “COFS” Market Makers in ChoiceOne Stock D. A. Davidson & Co. Nick Bicking 800.394.9230 Raymond James & Associates Anthony LanFranca 312.655.2961 Stock Registrar & Transfer Agent Continental St
Slide 28: Thank you
SERVICE • INNOVATION • RESPECT thank you
Slide 29: Appendix: Non-GAAP Reconciliation
29 APPENDIX NON - GAAP RECONCILIATION Year Ended December 31, 2019 2020 (In Thousands, Except Per Share Data) $ 8,465 $ 18,885 Income before income tax 2,001 3,219 Adjustment for pre - tax merger expenses 10,466 22,104 Adjusted income before income tax 1,294 3,272 Income tax expense 232 505 Tax impa
Slide 30: Appendix: Non-GAAP Reconciliation
30 Source: Numbers based on ChoiceOne internal data as of 12/31/2023 except where specifically identified APPENDIX NON - GAAP RECONCILIATION (1) Adjusted to a fully tax - equivalent basis to facilitate comparison to the taxable interest - earning assets. The adjustment use s an incremental tax rate
Choiceone Financial Services — Shareholder Meeting (May 2024) on 6ix