First Farmers & Merchants Corp. · OTC:FFMH
First Farmers & Merchants — Shareholder Meeting (April 2024)
41 slides from First Farmers & Merchants's shareholder meeting presentation, Apr 16, 2024
Slide 1: 2024 Annual Meeting of Shareholders
FIRST FARMERS AND MERCHANTS CORPORATION 2024 Annual Meeting of Shareholders April 16, 2024
Slide 2: Order of Business
2024 ANNUAL MEETING OF ORDER OF BUSINESS SHAREHOLDERS • Election of Directors • Ratification of Selection of Independent Registered Public Accounting Firm
Slide 3: Board of Directors
BOARD OF DIRECTORS Elected April 16, 2024 Dr. Christa S. Martin Jeffrey L. Aiken Dr. Martin M. Chaney Jonathan M. Edwards Executive Director of Belonging & W. Eric Mayberry Deputy Commissioner CEO President & CEO Student Resources President Tennessee Department of Agriculture Maury Regional Health E
Slide 4: Independent Registered Public Accounting Firm
INDEPENDENT REGISTERED PUBLIC 2024 Annual Meeting of ACCOUNTING FIRM Shareholders F i s c a l Ye a r E n d i n g D e c e m b e r 3 1 , 2 0 2 4
Slide 5: 2023 Highlights
2023 HIGHLIGHTS Record Loans Passing $1 Billion $1,050 Loan Growth (dollars in millions) $1,025 $1,018 $1,004 $1,000 $972 $975 $966 $965 $950 4Q22 1Q23 2Q23 3Q23 4Q23
Slide 6: 2023 Highlights
2023 HIGHLIGHTS • Improvement in Book Value Per Share • Annual Earnings Per Share • Cash Dividend • Repurchase of Shares • New Business Production • Protected Core Deposits
Slide 7: Bank Review
BANK REVIEW Rory A. Mallard Chief Banking Officer
Slide 8: Total Loans
TOTAL LOANS (dollars in thousands) $1,025,000 $1,019,000 5.5% Growth $1,000,000 $975,000 $966,000 $950,000 $925,000 December 31, 2022 December 31, 2023
Slide 9: 2023 Loan Growth
2023 LOAN GROWTH $39 $40 (dollars in millions) $30 $20 6.55% $11 $10 3.54% $3 5% $- Retail Business Banking Commercial
Slide 10: Team Effort
TEAM EFFORT • Implementation of New Loan Origination System • Generation of Loan Growth • Protection of our Core Deposits
Slide 11: First Farmers.
FIRST FARMERS.
Slide 12: Small Business
SMALL BUSINESS FIRST FARMERS.
Slide 13: Wealth Management Review
WEALTH MANAGEMENT REVIEW Dawn D. Moore Chief Wealth Management Officer
Slide 14: 10 Year Annual Total Asset Growth
10 YEAR ANNUAL TOTAL ASSET GROWTH $6,500 (dollars in millions) $6,000 $5,500 $5,000 52% GROWTH $4,500 $4,000 $3,500 $3,000 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 YTD 2024
Slide 15: 10 Year Annual Managed Asset Growth
10 YEAR ANNUAL MANAGED ASSET GROWTH (dollars in millions) $2,000 $1,750 107% GROWTH $1,500 $1,250 $1,000 $750 $500 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 YTD 2024
Slide 16: 10 Year Annual Income Growth
10 YEAR ANNUAL INCOME GROWTH $4,500 (dollars in thousands) $4,000 74% GROWTH $3,500 $3,000 $2,500 $2,000 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
Slide 17: Services Offered
SERVICES OFFERED • Wealth Management • Custody and Safekeeping • IRAs and Retirement Management • Estate Settlement • Financial Planning • Personal and Charitable Trusts
Slide 18: Our Team
OUR TEAM Sam Short Joanna Matthews Amy Vaught Trust Officer Senior Trust Officer Senior Trust Benefits Officer Linda Thomason Charles E. Plunkett Fred Palmliden Trust Officer Senior Personal Trust Officer Senior Portfolio Manager CRSP CTFA CFA, CMT
Slide 19: FFM Moderate Growth Model Portfolio (60/40)
FFM MODERATE GROWTH MODEL PORTFOLIO (60/40) Relative Performance (as of 12/31/23) Source: Morningstar Direct Past Performance does not guarantee nor is it a reliable indicator of future results.
Slide 20: Strategic Initiatives/Future Outlook
STRATEGIC INITIATIVES/FUTURE OUTLOOK • Best in Class Technology • Talent Development • Referral Systems Expansion • Financial Workshops & Seminars
Slide 21: 2023 Financial Report
—==_ FIRST FARMERS. BANKING | WEALTH MANAGEMENT | TRUST 2023 FINANCIAL REPORT
Slide 22: Financial Results
Financial Results • Net income - $16 million, third-best year in our 114-year history • Earnings per share of $3.80, second- best year in our 114-year history
Slide 23: Interest Rate Environment
Interest Rate Environment 3.54% 3.27% 3.35% 2.99% 3.14% 2.69% 2.67% 2.22% 2.21% 2.64% 1.93% 0.91% 1.66% 0.68% 0.47% 4Q22 1Q23 2Q23 3Q23 4Q23 Cost on Liabilities Yield on Assets Net Interest Margin
Slide 24: Non-interest Expense
Non-interest Expense (dollars in millions) $43.0 $40.3 $40.2 $39.6 $38.6 2019 2020 2021 2022 2023
Slide 25: Deposit Mix
Deposit Mix As of December 31, 2023 • Municipal Deposits – Down $191 million Interest Bearing Demand 16% Time Deposits 17% • Deposit Growth Municipal 14% Excluding Municipal – up $11 million Noninterest Bearing Demand 28% Savings and Money Markets • Deposit Cost – up 25% 400%
Slide 26: Capacity for Loan Growth
Capacity for Loan Growth 75% 75% 75% 75% 75% 60% 63% 58% 54% 55% 4Q22 1Q23 2Q23 3Q23 4Q23 Loans to Deposits - Strategic Target Loans to Deposits
Slide 27: Nonperforming Assets
Nonperforming Assets (dollars in thousands) $3,109 $1,407 $705 $873 $803 4Q22 1Q23 2Q23 3Q23 4Q23 Nonperforming Assets to Total Assets - 0.08% as of 4Q23
Slide 28: Stock Repurchases
Stock Repurchases 101,186 71,576 42,432 41,978 20,133 2019 2020 2021 2022 2023 Stock Repurchases - $9.9 million since 2019
Slide 29: Cash Dividends
Cash Dividends $0.94 $0.86 $0.84 $0.84 $0.84 2019 2020 2021 2022 2023 Annual Cash Dividend - 4Q23 up 4.3%, Annually
Slide 30: Book Value Per Share
Book Value Per Share Book Value Per Share $29.74 $25.72 $25.54 $22.59 $23.61 4Q22 1Q23 2Q23 3Q23 4Q23
Slide 31: OTC Pink Market
OTC Pink Market 90,000 $32.00 79,598 80,000 $30.00 70,000 $28.51 60,000 $27.53 $28.00 50,000 $25.66 $25.13 $25.29 $26.00 40,000 37,987 30,695 30,000 $24.00 20,359 20,000 $22.00 10,000 7,489 - $20.00 4Q22 1Q23 2Q23 3Q23 4Q23 OTC Pink Market Quarterly Volume and Average Share Price
Slide 32: Capital Ratios
Capital Ratios 9.77% 9.01% 9.70% 8.41% 8.00% 8.12% 8.26% 7.61% 6.18% 4.53% 2019 2020 2021 2022 2023 Tangible Common Equity/Tangible Assets Leverage
Slide 33: Bank Level Regulatory Capital Ratios
Bank Level Regulatory Capital Ratios 15.0% 15.8% 10.5% 8.5% Tier 1 Capital Total Risk-Based Capital Minimum Regulatory Capital First Farmers Capital
Slide 34: Financial Records
Financial Records • Loan growth of 5.5% pushed balances to a record $1.019 billion • Trust Services Fee Income grew 4.1% to a record $4.3 million
Slide 35: Bench Strength
BENCH STRENGTH Robert E. Krimmel Chief Administrative Officer Jill A. Giles Chief Financial Officer of First Farmers and Merchants Chief Financial Officer Rory A. Mallard Corporation First Farmers and Merchants Bank Chief Banking Officer Jennifer J. McConnell Andrew W. Davis Dr. Ernest Anye Chief Cr
Slide 36: Mission and Values
2024 ANNUAL MEETING OF MISSION AND VALUES SHAREHOLDERS • Mission – to enrich the lives of our team members, customers, and communities • Core Values – Relationships, Responsibility, Reliability, Relevance, Results, Respect
Slide 37: Waymon L. Hickman
Waymon L. Hickman 1934 - 2023 FIRST FARMERS.
Slide 38: Outlook for 2024
2024 ANNUAL MEETING OF SHAREHOLDERS OUTLOOK FOR 2024 • Loan Growth • Improving Asset Mix • Small Business Focus • Asset Quality
Slide 39: Outlook for 2024
2024 ANNUAL MEETING OF SHAREHOLDERS OUTLOOK FOR 2024 • Reinforced Balance Sheet • Improving Book Value • Improving NIM
Slide 40: Digital Technology Improvements
DIGITAL TECHNOLOGY 2024 Annual Meeting of IMPROVEMENTS Shareholders February November 2022 2023
Slide 41: Thank You!
THANK YOU! —_ FIRST FARMERS. BANKING | WEALTH MANAGEMENT | TRUST
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