Slide 1: MyBank.com Investor Presentation First Quarter 2024
MyBank.com INVESTOR PRESENTATION First Quarter 2024
Slide 2: Forward looking statements
2 Forward looking statements This presentation contains forward - looking statements as defined by the Private Securities Litigation Reform Act of 1995 . Forward - looking statements do not represent historical facts, but are statements about management's beliefs, plans and objectives about the futu
Slide 3: Table of Contents
3 I. II. II. Corporate Overview Financial Performance Appendices Pg. 4 Pg. 9 Pg. 30 Table of Contents
Slide 4: Our Mission and Corporate Overview
Our Mission To enrich the lives of our associates, customers, communities and shareholders through uncommon commitment to service and customized financial solutions. Corporate Overview Founded: 1900 Headquarters: Oakland, MD Locations: 22 branches Business Lines: ▪ Commercial & Retail Banking ▪ Trus
Slide 5: Core Markets
5 West Region Central Region East Region Loans (000s) $325,502 $420,340 $545,274 Deposits (000s) $130,535 $790,995 $500,925 Deposit Market Share (1) (at June 30, 2023) 2% 47% 4% Branches 3 9 10 Note: Out of market loans represent $118 million and are not reflected in this table; Brokered CDs represe
Slide 6: Core Strengths
6 Core Strengths ▪ Diversified revenue stream driven by trust and brokerage fee income provides protection during times of low interest rates Diversified Revenue Stream ▪ Stable legacy markets produce steady low - cost funding ▪ Technology and business relationships drive growth Core Deposit Franchi
Slide 7: Risk Management, Monitoring & Mitigation Underlies all Strategic Priorities
7 Risk Management, Monitoring & Mitigation Underlies all Strategic Priorities ▪ Low net charge - offs and stable asset quality resulting from conservative and proactive credit culture ▪ ACL level of 1.27%; future provisioning based on loan growth, economic environment and asset quality changes ▪ Div
Slide 8: Strategic Pillars & Key Objectives
Strategic Pillars & Key Objectives Culture & Human Capital ▪ Attract and hire passionate, diverse talent to engage with clients and prospects across broader geographics. ▪ Drive associate retention and foster career development through mentoring initiatives, leadership programs, and educational oppo
Slide 9: First Quarter Financial Highlights
First Quarter Financial Highlights $4.1 Million Net Income (1) $0.62 Diluted EPS (1) 0.85% * ROAA (1) 10.11% * ROATCE (1) 3.12% NIM ▪ Total assets increased $7.1 million compared to December 31, 2023 ▪ Consolidated net income (1) of $4.1 million in 1Q24 compared to $4.4 million in 1Q23 and $5.5 mill
Slide 10: Long-Term Growth
10 Long - Term Growth Pre - Provision Net Revenue ($ in millions) (1) $23.2 $30.8 $32.5 $25.9 $6.40 2020 2021 2022 2023 1Q2024 +5.5% YoY (1) See Appendix for a reconciliation of these non - GAAP financial measures $1.97 $3.54 $3.76 $2.80 $0.62 2020 2021 2022 2023 1Q2024 +6.2% YoY Diluted Earnings pe
Slide 11: Solid Profitability
11 Solid Profitability (1) See Appendix for a reconciliation of these non - GAAP financial measures 11.92% 19.78% 19.94% 12.92% 10.11% 2020 2021 2022 2023 1Q2024 Long - term Strategic Target 13% - 15% 0.86% 1.35% 1.39% 0.97% 0.85% 2020 2021 2022 2023 1Q2024 Long - term Strategic Target 1.25% - 1.60%
Slide 12: Loan Diversification
12 Total 1 - 4 Family 36% CRE - NOO 21% C&I 19% CRE - OO 11% C&D 6% Consumer 4% Multi - family 3% Loan Diversification Loan Portfolio Mix (03/31/2024) RE/Rental/Leasing NOO 23% RE/Rental/ Leasing OO, C&I 20% All Other 18% Accommodations 12% Services 7% RE/Rental/Leasing Multifamily 5% Trade 3% Const
Slide 13: Commercial Industry Mix by Origination Year
13 Commercial Industry Mix by Origination Year Commercial Industry Mix by Origination Prior to 2000 2000 - 2005 2006 - 2010 2011 - 2015 2016 - 2020 2021 - Current Total RE / Rental / Leasing - NOO -$ 4,421,846$ 3,072,508$ 12,117,472$ 86,379,551$ 102,222,237$ 208,213,614$ RE / Rental / Leasing - OO,
Slide 14: Commercial Real Estate
14 Commercial Real Estate Focus on risk mitigation and managing of concentrations ▪ CRE / Total Capital: 235% ▪ ADC / Total Capital: 40% * There are no office buildings located in metropolitan markets or over four stories. ** There are no major/big box retail tenants. OFFICE* Geography Note Book Bal
Slide 15: Variable Rate Loans and Repricing
15 Variable Rate Loans and Repricing * Includes personal lines of credit and home equity lines Loan Type Reprices Monthly % to Total Type Repricing Repricing 2024 % to Total Type Repricing Repricing 2025 % to Total Type Repricing Repricing 2026 + % to Total Type Repricing Grand Total Commercial Loan
Slide 16: Credit Quality
16 Credit Quality ALL / ACL Trends (Net Charge - Offs)/Average Loans 0.13% - 0.02% - 0.02% - 0.07% - 0.13% 2020 2021 2022 2023 1Q2024 Nonaccrual Loans / Total Loans 0.35% 0.21% 0.27% 0.28% 1.13% 2020 2021 2022 2023 1Q2024 NPAs / Total Assets 0.99% 0.60% 0.46% 0.48% 1.07% 2020 2021 2022 2023 1Q2024 1
Slide 17: Investment Portfolio
17 Investment Portfolio Sector Par (000s) Portfolio % Book Yield Duration Treasury/Agency 85,888 30% 2.16% 6.38 Fixed MBS 52,095 18% 2.37% 5.29 CMO 74,884 26% 1.86% 6.45 Municipal 15,420 5% 3.92% 5.81 Corporate 1,000 1% 5.83% 2.44 Other 58,227 20% 1.98% 4.41 TOTAL $287,514 100.0 2.19% 5.77 Ratings:
Slide 18: Shocked Investment Portfolio Unrealized Gains / Losses Capital Impact
18 Shocked Investment Portfolio Unrealized Gains / Losses Capital Impact Intent Dn200 Dn100 BaseCase Up100 Up200 Up300 Up400 AFS - 9,883 - 13,645 - 17,450 - 21,349 - 25,135 - 28,724 - 31,774 HTM - 10,411 - 20,617 - 30,956 - 39,778 - 48,656 - 56,969 - 64,033 Total - 20,294 - 34,262 - 48,406 - 61,127
Slide 19: Deposits
19 Deposits 30% 34% 32% 28% 27% 14% 16% 23% 23% 24% 40% 39% 36% 37% 37% 16% 11% 8% 10% 10% 0% 0% 0% 2% 2% 2020 2021 2022 2023 1Q2024 NIB Demand IB Demand MMA & Savings CDs - Retail CDs - Brokered $1.57 $1.55 $1.42 $1.56 $1.57 Deposit Composition ($ in billions as of 03/31/2024) 82% 79% 81% 91% 90% L
Slide 20: Funding
20 Funding 43% 48% 9% Commercial Deposits Retail Deposits Borrowings Funding Mix Brokered/Wholesale Maturities $40 $40 $15 $15 March 2025 September 2024 August 2024 May 2024 Dollars (in millions) Bank Term Funding Program FHLB Advance FHLB Advance 4.87% 5.33% 5.31% 4.70% Brokered CD Brokered CD
Slide 21: Net Interest Margin
21 Net Interest Margin (1) See Appendix for a reconciliation of these non - GAAP financial measures 3.99% 3.63% 3.85% 4.63% 4.94% 0.91% 0.51% 0.44% 1.92% 2.65% 3.34% 3.28% 3.56% 3.26% 3.12% 0.49% 0.24% 0.21% 1.16% 1.51% -0.5% 0.5% 1.5% 2.5% 3.5% 4.5% 2020 2021 2022 2023 1Q2024 Yield on Earning Asset
Slide 22: Diversified Fee Income
22 Diversified Fee Income (1) See Appendix for a reconciliation of these non - GAAP financial measures Composition Trust and Brokerage 55% Service Charges 16% Net Gain on Loan Sales 2% Debit Card Income 19% Bank - owned Life Insurance 7% Other Noninterest Income 1% Non - Interest Income Mix 1Q2024 $
Slide 23: Committed to Efficiency & Innovation
23 Committed to Efficiency & Innovation 64.6% 57.5% 56.4% 65.1% 65.7% 2020 2021 2022 2023 1Q2024 (1) See Appendix for a reconciliation of these non - GAAP financial measures Efficient operational platforms and fraud protection ▪ Mortgage Bot ▪ SecureLOCK Premium Debit Card Fraud ▪ Credit Insights/ S
Slide 24: Liquidity Position
24 Liquidity Position Liquidity Sources (03/31/2024) Amount Available ($ in thousands) Amount Used ($ in thousands) Net Availability ($ in thousands) Internal Sources Excess Cash $79,521 $79,521 Unpledged Securities (BV) $35,757 $35,757 External Sources Federal Reserve (Discount Window) $31,776 $31,
Slide 25: Interest Rate Risk
25 Interest Rate Risk (1) Standard Model Assumptions Interest Rate Risk Sensitivity ▪ The Bank’s interest rate risk position is stress tested under three interest rate ramp scenarios to determine the impact on net interest income, net income and capital under dynamic and static balance sheet conditi
Slide 26: Capital Management
26 Capital Management 16.08% 15.89% 16.12% 15.64% 15.83% 2020 2021 2022 2023 1Q2024 10.36% 10.80% 11.46% 11.30% 11.48% 2020 2021 2022 2023 1Q2024 12.61% 12.50% 12.96% 12.44% 12.60% 2020 2021 2022 2023 1Q2024 14.83% 14.64% 15.06% 14.42% 14.58% 2020 2021 2022 2023 1Q2024 CET1 Ratio Leverage Ratio Tier
Slide 27: Capital Management
27 Capital Management $17.17 $19.61 $20.90 $22.56 $23.08 2020 2021 2022 2023 1Q2024 6.97% 7.56% 7.59% 7.91% 8.07% 2020 2021 2022 2023 1Q2024 Tangible Book Value / Share TCE Ratio
Slide 28: Strategic Targets
28 Strategic Targets Metric Actual 12/31/2022 Actual 12/31/2023 Non - GAAP 12/31/2023 Long Term Strategic Target Range (*) Strong Shareholder Return EPS Growth (YoY) 27% - 40% - 26% (1) 8% - 12% Dividend Payout Ratio 15.9% 34.6% 34.6% 20% - 25% ROAA 1.39% 0.78% 0.97% (1) 1.25% - 1.60% ROATCE 19.94%
Slide 29: Strong Investor Relations & Shareholder Engagement
Strong Investor Relations & Shareholder Engagement Members of the Board and senior management routinely engage with shareholders and other stakeholders, and management regularly updates the Board in the context of ongoing investor discussions. These engagements help the Board and management gather f
Slide 30: Appendices
30 I. II. III. IV. Management Team Board of Directors ESG Journey & Statistics Non - GAAP Reconciliation Pg. 31 Pg. 32 Pg. 35 Pg. 37 Appendices
Slide 31: Our Dedicated Management Team
31 Our Dedicated Management Team Carissa L. Rodeheaver Chairman of the Board, President & CEO 32+ years career with First United with in - depth industry, wealth management, financial and operational experience Jason B. Rush SVP & Chief Operating Officer 30+ years with in - depth industry, retail, r
Slide 32: Board of Directors
32 32 John F. Barr Independent Director Owner, Ellsworth Electric, Inc. Sanu B. Chadha Independent Director Managing Partner, M&S Consulting Christy M. DiPietro Independent Director, Audit Chair Chartered Financial Analyst, Hidden Cove Advisory Patricia A. Milon Independent Director Principal, Milfo
Slide 33: Board of Directors: Thoughtful Evaluation and Evolution
33 Board of Directors Thoughtful Evaluation and Evolution Our Board is comprised of a diverse group of directors who bring a variety of perspectives, experience, and characteristics to First United. Director Diversity 55% 91% of our directors are gender and/or racially diverse of our directors are i
Slide 34: Board of Directors Skills Matrix
34 Board of Directors The First United board of directors brings a diverse range of skills, experiences, and backgrounds to the work of overseeing ris k and strategy. With experience in fields such as banking, government, accounting, investing, project management, technology, and a range of local en
Slide 35: Continuous Progress
35 Continuous Progress We continue to advance our ESG profile over time, recognizing the importance of our key stakeholders – including our customers and our communities – to our business. Over the past few years, we have implemented several important enhancements to align our ESG profile with our l
Slide 36: ESG at First United
36 ESG at First United ▪ LED lighting installed throughout branch network and operations center ▪ Recycling, focus on reduced printing (65% reduction since pre - COVID) ▪ Leveraging virtual meeting opportunities to reduce travel footprint ▪ 46% of deposit customers and 11% of loan customers enrolled
Slide 37: Non-GAAP financial measures
37 This presentation includes certain non - GAAP financial measures, including pre - provision net revenue, net income, earnings per share (basic and diluted), return on average assets, return on average tangible common equity, tangible common equity, tangible assets, the ratio of tangible common eq
Slide 38: Non-GAAP Reconciliation, continued
38 Non - GAAP Reconciliation , continued ($000s, except where otherwise noted) YTD 2020 2021 2022 2023 Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q1 2024 3/31/2024 Weighted Average Common shares - basic (actual) (d) 7,003,955 6,710,463 6,649,740 6,685,676 6,675,181 6,703,805 6,714,267 6,649,493 6,643,898 6,643
Slide 39: Non-GAAP Reconciliation, continued
39 Non - GAAP Reconciliation , continued ($000s, except where otherwise noted) YTD 2020 2021 2022 2023 Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q1 2024 3/31/2024 Return on Average Assets (quarter and YTD annualized) Average Assets ( c) 1,613,669$ 1,765,148$ 1,801,711$ 1,924,119$ 1,892,111$ 1,930,093$ 1,954,1
Slide 40: Non-GAAP Reconciliation, continued
40 Non - GAAP Reconciliation , continued ($000s, except where otherwise noted) YTD 2020 2021 2022 2023 Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q1 2024 3/31/2024 Tangible Book Value per Common Share Total common equity, as reported (h) 131,047$ 141,900$ 151,793$ 161,873$ 152,868$ 155,156$ 154,990$ 161,873$ 1