8-K
Bank First Corp (BFC)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of TheSecurities Exchange Act of 1934
| Date of Report (Date of earliest event reported) | April 21, 2020 | |
|---|---|---|
| Bank First Corporation | ||
| --- | ||
| (Exact name of registrant as specified in its charter) | ||
| Wisconsin | 001-38676 | 39-1435359 |
| --- | --- | --- |
| (State or other jurisdiction | (Commission | (IRS Employer |
| of incorporation) | File Number) | Identification No.) |
| 402 North 8^th^ Street, Manitowoc, WI | 54220 | |
| --- | --- | |
| (Address of principal executive offices) | (Zip Code) | |
| Registrant’s telephone number, including area code | (920) 652-3100 | |
| --- | --- | |
| N/A | ||
| --- | ||
| (Former name or former address, if changed since last report.) |
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ¨ | Written communications pursuant to Rule 425 under the<br>Securities Act (17 CFR 230.425) |
|---|---|
| ¨ | Soliciting material pursuant to Rule 14a-12 under the<br>Exchange Act (17 CFR 240.14a-12) |
| --- | --- |
| ¨ | Pre-commencement communications pursuant to Rule 14d-2(b)<br>under the Exchange Act (17 CFR 240.14d-2(b)) |
| --- | --- |
| ¨ | Pre-commencement communications pursuant to Rule 13e-4(c)<br>under the Exchange Act (17 CFR 240.13e-4(c)) |
| --- | --- |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Ticker symbol(s) | Name of each exchange on which registered |
|---|---|---|
| Common Stock, par value $0.01 per share | BFC | The Nasdaq Stock Market LLC |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company x
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for company with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. x
| Item 2.02 | Results of Operations and Financial Condition. |
|---|
On April 21, 2020, Bank First Corporation (the “Corporation”) announced its earnings for the quarter ended March 31, 2020. A copy of the press release is attached as Exhibit 99.1 to this Report on Form 8-K and is incorporated herein by reference.
| Item 7.01 | Regulation FD Disclosure. |
|---|
The Corporation is scheduled to make presentations to current and prospective investors after April 21, 2020. Attached as Exhibit 99.2 to this Form 8-K is a copy of the presentation which the Corporation will make available at these presentations and will post on its website at www.bankfirstwi.bank.
Pursuant to General Instruction B.2 of Form 8-K, the information in this Item 7.01 and Exhibit 99.2 is being furnished to the Securities and Exchange Commission and shall not be deemed to be filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) or otherwise subject to the liabilities under that Section. Furthermore, the information in this Item 7.01 and Exhibit 99.2 shall not be deemed to be incorporated by reference into the filings of the Registrant under the Securities Act of 1933, as amended, or the Exchange Act.
| Item 8.01 | Other Events. |
|---|
The disclosures contained in the above Item 2.02 and Exhibit 99.1 are incorporated by reference into this Item 8.01 and shall be deemed filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and incorporated by reference into the filings of the Corporation under the Securities Act of 1933, as amended, or the Exchange Act.
| Item 9.01 | Financial Statements and Exhibits. |
|---|
| (d) | Exhibits |
|---|---|
| Exhibit | |
| --- | --- |
| Number | Description of Exhibit |
| 99.1 | Press Release, dated April 21, 2020 |
| 99.2 | Investor Presentation Regarding Bank First’s Response to the COVID-19 Pandemic |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| BANK FIRST CORPORATION | ||
|---|---|---|
| Date: April 21, 2020 | By: | /s/ Kevin M. LeMahieu |
| Kevin M. LeMahieu | ||
| Chief Financial Officer |
Exhibit 99.1
| NEWS<br><br><br><br>release |
|---|
P.O. Box 10, Manitowoc, WI 54221-0010
For further information, contact:
Kevin M LeMahieu, Chief Financial Officer
Phone: (920) 652-3200 / [email protected]
FOR IMMEDIATE RELEASE
Bank First Announces Net Income forthe First Quarter of 2020
| · | Net income of $7.3 million and earningsper common share of $1.03 for the three months ended March 31, 2020 |
|---|---|
| · | Annualized return on average assetsof 1.32% for the three months ended March 31, 2020 |
| --- | --- |
| · | Quarterly cash dividend of $0.20 pershare declared, matching prior quarter and prior-year quarter |
| --- | --- |
MANITOWOC, Wis, April 21, 2019 -- Bank First Corporation (NASDAQ: BFC) (“Bank First”), the holding company for Bank First, N.A., reported net income of $7.3 million, or $1.03 per share, for the first quarter of 2020, compared with net income of $6.6 million, or $1.00 per share, for the respective prior-year comparative period.
Operating Results
Net interest income during the first quarter of 2020 was $18.6 million, down $0.1 million from the previous quarter but up $3.4 million from the first quarter of 2019.
Interest income related to purchased loan accounting entries, resulting from our purchases of Waupaca Bancorporation, Inc. (“Waupaca”) during the fourth quarter of 2017 and Partnership Community Bancshares, Inc. (“Partnership”) during the third quarter of 2019, increased net income (after tax) during the first quarter of 2020 by $0.8 million, or $0.11 per share, compared to $1.1 million, or $0.16 per share, and $0.8 million, or $0.11 per share, for the fourth and first quarters of 2019, respectively.
Net interest margin was 3.81% for the first quarter of 2020, compared to 3.85% for the previous quarter and 3.82% for the first quarter of 2019. The aforementioned purchase loan accounting entries added 0.20%, 0.27% and 0.25% to net interest margin for each of these periods, respectively. The ability to improve net interest margin less the impact of purchase accounting for the first quarter of 2020 compared to the fourth quarter of 2019 was accomplished through a combination of swift response to the falling rate environment on the funding side, reducing cost of interest-bearing liabilities by 0.19% quarter-over-quarter, and historically effective use of floor interest rates on variable rate loans, limiting the reduction of yield on interest-bearing assets to 0.02% quarter-over-quarter.
Bank First recorded a provision for loan losses of $1.0 million during the first quarter of 2020, compared to $1.1 million and $0.6 million during the fourth and first quarters of 2019, respectively. Net recoveries of previously charged off loan balances further increased the allowance for loan losses by $0.6 million during the first quarter of 2020. In response to the heightened economic risks resulting from the COVID-19 pandemic, management increased certain economic risk factors in the calculation of Bank First’s analysis of allowance for loan losses, leading to an increase of $0.4 million in provision for loan losses during March 2020. As further discussed later in this release, Bank First entered this time of heightened economic turbulence with strong asset quality metrics. While there is great uncertainty over the impact of the current health crisis on credit quality of all financial institutions going forward, Bank First has maintained a consistently conservative credit culture that allowed it to weather the Great Recession from 2008-2011 with continually increasing earnings each year. Actual credit quality deterioration will depend heavily on the length of time that local and national economies remain under the various “stay at home” orders issued by each state. The longer these orders stay in place, the greater the stress will be on the economy. Management will continue to monitor these factors in assessing the adequacy of the allowance for loan losses in future quarters.
Noninterest income was $3.9 million during the first quarter of 2020, compared to $3.2 million and $3.5 million during the fourth and first quarters of 2019, respectively. Loan servicing income totaled $0.4 million during the quarter, compared to a loss of $0.3 million in this classification in the fourth quarter of 2019 and income of $0.2 million in the first quarter of 2019. A $0.7 million reduction in the valuation of a servicing rights asset on the Company’s balance sheet during the fourth quarter of 2019 led to the loss in that period. Net gains on sales of mortgage loans to the secondary market totaled $0.5 million during the quarter, down $0.2 million from the prior quarter, but up $0.4 million from the first quarter of 2019, as continued strong demand for residential mortgage loans offset what is typically a slow quarter for this line of business. Sales of securities led to gains of $0.6 million and $0.2 million in the fourth and first quarters of 2019. Bank First did not sell any securities during the first quarter of 2020, leading to negative variances compared to both of those periods. Other noninterest income was positively impacted during the first quarter of 2019 by the revaluing of an investment Bank First holds in common stock of another financial institution, historically recorded at its cost basis, to fair value based on recent observable prices in orderly stock transactions at that time, resulting in income of $0.6 million. This event did not have a repeating impact in the first quarter of 2020, resulting in a negative variance.
Noninterest expense was $12.7 million in the first quarter of 2020, compared to $11.2 million and $9.5 million during the fourth and first quarters of 2019, respectively. Personnel expense totaled $6.5 million for the first quarter of 2020, compared to $5.9 million and $5.3 million for the fourth and first quarters of 2019, respectively. The negative variance to the prior year first quarter was due to added scale from the Partnership acquisition. The negative variance from the prior quarter was due to items such as payroll taxes and retirement plan contributions which have a higher impact on earlier quarters each year due to reaching statutory maximums for individual employees throughout the year. Occupancy, equipment and office expense saw an increase from the prior quarter of $0.2 million and from the prior year first quarter of $0.4 million. This area of expense was negatively impacted in comparison to both periods by a relocation of two of our branches to new facilities during the quarter as well as by the cost of equipping a large portion of our staff to work remotely in response to the COVID-19 pandemic. The Bank had sales of two large foreclosed properties scheduled to close late in the first quarter of 2020 which would have resulted in only modest losses. Due to the economic turmoil that resulted during the last several weeks of the quarter, one of these sales was postponed until early in the second quarter of 2020 at a significantly reduced price and the other was cancelled altogether causing the Bank to reduce the valuation on that property. In total, these two situations led to negative valuation adjustments on other real estate owned of $1.0 million. Like most banks with total assets under $10 billion, Bank First received an assessment credit from the Federal Deposit Insurance Corporation (“FDIC”) Deposit Insurance Fund. The application of this credit resulted in a reversal of a previous FDIC assessment accrual totaling $0.3 million during the fourth quarter of 2019, positively impacting outside service fees during that quarter and leading to a negative variance in comparison to the first quarter of 2020. Expenses related to the upcoming acquisition of Tomah Bancshares, Inc., which is still planned to close on May 15, 2020, totaled $0.3 million during the first quarter of 2020.
Balance Sheet
Total assets were $2.20 billion at March 31, 2020, down $9.9 million from December 31, 2019, and up $394.9 million from March 31, 2019. Total loans were $1.77 billion at March 31, 2020, up $28.9 million from December 31, 2019, and up $394.9 million from March 31, 2019. Excluding loans acquired in the Partnership acquisition, loans grew by 4.1% over the trailing twelve months. Annualized loan growth during the first quarter of 2020 amounted to 6.7%. Total deposits, nearly all of which remain core deposits, were $1.85 billion at March 31, 2020, up $3.9 million from December 31, 2019, and up $273.5 million from March 31, 2019.
On March 27, 2020, the President signed into law the Coronavirus Aid, Relief, and Economic Security (“CARES”) Act, a key provision of which was the Paycheck Protection Program (“PPP”). The PPP made available $349 billion in funds for lending through financial institutions, carrying a 100% guaranty by the Small Business Administration (“SBA”), which may be forgivable through reimbursement to the financial institutions by the SBA if funds are used by the borrowers for purposes stipulated within the PPP guidelines. Subsequent to March 31, 2020, Bank First processed over 1,200 applications funding in excess of $245.0 million in PPP loans to help the businesses of the communities we serve continue paying their employees. In addition to the considerable liquidity provided through Bank First’s borrowing availability at the Federal Home Loan Bank of Chicago, which approximated $317.9 million at March 31, 2020, the bank also sold $36.6 million in U.S. Treasury notes subsequent to quarter-end to support the liquidity needs of the PPP loans. The Federal Reserve also announced on April 6, 2020, that they will be providing institutions with term financing backed by PPP loans to accommodate any liquidity needs caused by participation in this program. PPP loans will carry a zero risk-weighting when calculating bank capital ratios and will not impact bank leverage ratios if the Federal Reserve credit facility is utilized.
Asset Quality
Nonperforming assets at March 31, 2020, totaled $11.1 million, down from $11.5 million and $19.4 million at the end of the fourth and first quarters of 2019, respectively. Nonperforming assets to total assets ended the first quarter of 2020 at 0.51%, down from 0.52% and 1.30% at the end of the fourth and first quarters of 2019, respectively. As previously mentioned, the current health crisis will undoubtedly impact these credit quality metrics, though the ultimate impact is not foreseeable due to the uncertainty of the length of duration of this situation.
Capital Position
Stockholders’ equity totaled $237.7 million at March 31, 2020, an increase of $7.5 million from the previous quarter and $58.5 million from March 31, 2019. Strong earnings served to increase capital during the quarter while being offset by dividends totaling $1.4 million. In addition to these items, balances from a deferred compensation plan which had been terminated during 2019 were paid out during the quarter in shares of Company stock, adding $2.1 million to capital. The aforementioned sale of U.S. Treasury notes subsequent to quarter-end added another $3.1 million to capital which will benefit Bank First in future quarters.
Bank First’sActions to Protect and Support Customers and Employees
On April 21, 2020, Bank First published a presentation which detailed its actions taken in response to the COVID-19 pandemic. Among other things this document contains information regarding the number of customers requesting payment deferrals as a result of the pandemic, detail of the composition of the Bank’s loan portfolio as of March 31, 2020, and temporary changes made to certain customer fee arrangements. This document can be viewed by visiting the News section of Bank First’s investor relations site.
Dividend Declaration
Bank First’s Board of Directors approved a quarterly cash dividend of $0.20 per common share, payable on July 8, 2020, to shareholders of record as of June 23, 2020.
Bank First Corporation provides financial services through its subsidiary, Bank First, which was incorporated in 1894. The Bank is an independent community bank with 23 banking locations in Wisconsin. The Bank has grown through both acquisitions and de novo branch expansion. The Bank offers loan, deposit and treasury management products at each of its banking offices. Insurance services are available through our bond with Ansay & Associates, LLC. Trust, investment advisory and other financial services are offered through the Bank’s partnership with Legacy Private Trust, an alliance with Morgan Stanley and an affiliation with McKenzie Financial Services, LLC. The Bank is a co-owner of a data processing subsidiary, UFS, LLC, which provides data and technology services to banks in the Midwest. The Company employs approximately 284 full-time equivalent staff and has assets of approximately $2.2 billion. Further information about Bank First Corporation is available by clicking on the Investor Relations tab at www.BankFirstWI.bank.
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Forward Looking Statements:This news release may contain certain “forward-looking statements” that represent Bank First Corporation’s expectationsor beliefs concerning future events. Such forward-looking statements are about matters that are inherently subject to risks anduncertainties. Because of the risks and uncertainties inherent in forward looking statements, readers are cautioned not to placeundue reliance on them, whether included in this news release or made elsewhere from time to time by Bank First Corporation oron its behalf. Bank First Corporation disclaims any obligation to update such forward-looking statements. In addition, statementsregarding historical stock price performance are not indicative of or guarantees of future price performance.
Bank First Corporation
Consolidated Financial Summary (Unaudited)
| (In thousands, except per share data) | At or for the Three Months Ended | ||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 3/31/2020 | 12/31/2019 | 9/30/2019 | 6/30/2019 | 3/31/2019 | |||||||||||
| Results of Operations: | |||||||||||||||
| Interest income | $ | 23,296 | $ | 23,795 | $ | 25,489 | $ | 20,158 | $ | 19,723 | |||||
| Interest expense | 4,653 | 5,015 | 5,176 | 4,784 | 4,523 | ||||||||||
| Net interest income | 18,643 | 18,780 | 20,313 | 15,374 | 15,200 | ||||||||||
| Provision for loan losses | 975 | 1,125 | 3,000 | 500 | 625 | ||||||||||
| Net interest income after provision for loan losses | 17,668 | 17,655 | 17,313 | 14,874 | 14,575 | ||||||||||
| Noninterest income | 3,897 | 3,211 | 3,145 | 2,736 | 3,540 | ||||||||||
| Noninterest expense | 12,741 | 11,182 | 12,087 | 9,955 | 9,536 | ||||||||||
| Income before income tax expense | 8,824 | 9,684 | 8,371 | 7,655 | 8,579 | ||||||||||
| Income tax expense | 1,558 | 2,225 | 1,712 | 1,666 | 1,992 | ||||||||||
| Net income | $ | 7,266 | $ | 7,459 | $ | 6,659 | $ | 5,989 | $ | 6,587 | |||||
| Earnings per common share - basic | $ | 1.03 | $ | 1.05 | $ | 0.95 | $ | 0.91 | $ | 1.00 | |||||
| Earnings per common share - diluted | 1.02 | 1.04 | 0.93 | 0.90 | 1.00 | ||||||||||
| Common Shares: | |||||||||||||||
| Basic weighted average | 7,083,520 | 7,084,728 | 7,036,807 | 6,577,016 | 6,574,362 | ||||||||||
| Diluted weighted average | 7,128,247 | 7,182,854 | 7,134,674 | 6,675,794 | 6,608,273 | ||||||||||
| Outstanding | 7,155,955 | 7,084,728 | 7,084,728 | 6,576,171 | 6,577,045 | ||||||||||
| Noninterest income / noninterest expense: | |||||||||||||||
| Service charges | $ | 916 | $ | 1,110 | $ | 918 | $ | 799 | $ | 679 | |||||
| Income from Ansay | 891 | 55 | 319 | 543 | 875 | ||||||||||
| Income from UFS | 897 | 842 | 768 | 731 | 594 | ||||||||||
| Loan servicing income | 462 | (291 | ) | 374 | 244 | 223 | |||||||||
| Net gain on sales of mortgage loans | 460 | 627 | 533 | 154 | 87 | ||||||||||
| Net gain on sales of securities | - | 611 | - | 23 | 234 | ||||||||||
| Noninterest income from strategic alliances | 17 | 21 | 26 | 29 | 19 | ||||||||||
| Other noninterest income | 254 | 236 | 207 | 213 | 829 | ||||||||||
| Total noninterest income | $ | 3,897 | $ | 3,211 | $ | 3,145 | $ | 2,736 | $ | 3,540 | |||||
| Personnel expense | $ | 6,452 | $ | 5,918 | $ | 6,272 | $ | 5,403 | $ | 5,310 | |||||
| Occupancy, equipment and office | 1,275 | 1,103 | 1,076 | 832 | 849 | ||||||||||
| Data processing | 1,199 | 1,478 | 1,158 | 960 | 913 | ||||||||||
| Postage, stationery and supplies | 172 | 141 | 135 | 192 | 123 | ||||||||||
| Net (gain) loss on sales and valuations of other real estate owned | 976 | 36 | (10 | ) | (135 | ) | 36 | ||||||||
| Advertising | 55 | 88 | 53 | 53 | 74 | ||||||||||
| Charitable contributions | 123 | 69 | 225 | 141 | 131 | ||||||||||
| Outside service fees | 801 | 204 | 1,171 | 982 | 684 | ||||||||||
| Amortization of intangibles | 334 | 373 | 374 | 161 | 161 | ||||||||||
| Other noninterest expense | 1,354 | 1,772 | 1,633 | 1,366 | 1,255 | ||||||||||
| Total noninterest expense | $ | 12,741 | $ | 11,182 | $ | 12,087 | $ | 9,955 | $ | 9,536 | |||||
| Period-end balances: | |||||||||||||||
| Loans | $ | 1,765,242 | $ | 1,736,343 | $ | 1,714,213 | $ | 1,419,192 | $ | 1,431,498 | |||||
| Allowance for loan losses | 12,967 | 11,396 | 10,131 | 12,170 | 12,213 | ||||||||||
| Investment securities available-for-sale, at fair value | 172,070 | 181,506 | 136,935 | 120,083 | 122,761 | ||||||||||
| Investment securities held-to-maturity, at cost | 43,732 | 43,734 | 42,605 | 39,537 | 40,769 | ||||||||||
| Goodwill and other intangibles, net | 52,789 | 53,122 | 54,153 | 19,998 | 20,160 | ||||||||||
| Total assets | 2,200,320 | 2,210,268 | 2,163,501 | 1,806,467 | 1,805,408 | ||||||||||
| Deposits | 1,847,209 | 1,843,311 | 1,838,080 | 1,574,998 | 1,573,677 | ||||||||||
| Stockholders' equity | 237,682 | 230,211 | 225,332 | 185,448 | 179,177 | ||||||||||
| Book value per common share | 33.21 | 32.49 | 31.81 | 28.20 | 27.24 | ||||||||||
| Tangible book value per common share | 26.44 | 25.60 | 24.86 | 25.63 | 24.65 | ||||||||||
| Average balances: | |||||||||||||||
| Loans | $ | 1,744,576 | $ | 1,718,705 | $ | 1,682,932 | $ | 1,420,710 | $ | 1,434,283 | |||||
| Interest-earning assets | 2,011,382 | 1,976,420 | 1,923,451 | 1,679,604 | 1,652,106 | ||||||||||
| Total assets | 2,196,662 | 2,160,080 | 2,095,357 | 1,801,530 | 1,773,345 | ||||||||||
| Deposits | 1,843,039 | 1,835,430 | 1,786,373 | 1,563,322 | 1,548,306 | ||||||||||
| Interest-bearing liabilities | 1,476,814 | 1,373,320 | 1,310,757 | 1,142,604 | 1,141,177 | ||||||||||
| Goodwill and other intangibles, net | 48,606 | 49,071 | 42,373 | 20,096 | 20,259 | ||||||||||
| Stockholders' equity | 233,470 | 228,404 | 227,205 | 181,498 | 175,058 | ||||||||||
| Financial ratios: | |||||||||||||||
| Return on average assets | 1.32 | % | 1.37 | % | 1.27 | % | 1.33 | % | 1.49 | % | |||||
| Return on average common equity | 12.45 | % | 12.96 | % | 11.72 | % | 13.20 | % | 15.05 | % | |||||
| Average equity to average assets | 10.63 | % | 10.57 | % | 10.84 | % | 10.07 | % | 9.87 | % | |||||
| Stockholders' equity to assets | 10.80 | % | 10.42 | % | 10.42 | % | 10.27 | % | 9.92 | % | |||||
| Tangible equity to tangible assets | 8.79 | % | 8.39 | % | 8.33 | % | 9.42 | % | 9.06 | % | |||||
| Loan yield | 5.00 | % | 5.15 | % | 5.63 | % | 5.22 | % | 5.15 | % | |||||
| Earning asset yield | 4.74 | % | 4.86 | % | 5.37 | % | 4.90 | % | 4.93 | % | |||||
| Cost of funds | 1.27 | % | 1.45 | % | 1.57 | % | 1.68 | % | 1.61 | % | |||||
| Net interest margin, taxable equivalent | 3.81 | % | 3.85 | % | 4.30 | % | 3.76 | % | 3.82 | % | |||||
| Net loan charge-offs to average loans | -0.14 | % | -0.01 | % | 1.20 | % | 0.16 | % | 0.18 | % | |||||
| Nonperforming loans to total loans | 0.42 | % | 0.31 | % | 0.30 | % | 1.20 | % | 1.14 | % | |||||
| Nonperforming assets to total assets | 0.51 | % | 0.52 | % | 0.52 | % | 1.10 | % | 1.07 | % | |||||
| Allowance for loan losses to loans | 0.73 | % | 0.66 | % | 0.59 | % | 0.86 | % | 0.85 | % |
Exhibit 99.2
BANK FIRST CORPORATION COVID - 19 Pandemic Response April 21, 2020 www.BankFirstWI.bank Ticker: BFC
Safe Harbor Statement This presentation includes "forward looking statements" within the meaning of the Private Securities Litigation Reform Act of 19 95. Such statements include, but are not limited to, statements concerning future business, revenue and earnings. These statement s a re not historical facts or guarantees of future performance, events or results. There are risks, uncertainties and other factors th at could cause the actual results of the Company to differ materially from the results expressed or implied by such forward - looking state ments. Forward looking statements speak only as of the date they are made. The Company undertakes no obligation to publicly update o r revise forward looking information, whether as a result of new, updated information, future events or otherwise. Statements r ega rding historical stock price performance are not indicative of or guarantees of future stock price performance.
Bank First’s Preparedness & Response ▪ Active monitoring of flu season and COVID - 19 in Asia. ▪ Management begins meeting to review and discuss Pandemic Flu Plan. ▪ Management reviews Business Continuity Plan and discusses crisis management actions. ▪ Initial order of masks placed as a precaution. ▪ Management meets to discuss developments surrounding COVID - 19. Phase 4 of Pandemic Flu Plan is implemented. ▪ First Pandemic Committee meeting with all team members. Daily meetings occur thereafter. ▪ Orders placed for additional hand sanitizer, masks, and gloves. Tissue boxes sent to each office. ▪ Employees instructed to stay home for two weeks if sick, have traveled to a Level 3 Country, or went on a cruise. ▪ COVID - 19 response information shared with employees. Team is required to begin social distancing. Sanitization procedures shared . ▪ Begin testing work - from - home capabilities and arranging alternative locations for staff in same departments. IT orders additional laptops and reviews VPN and GoToMeeting licenses and capabilities. Phase 1 Phase 2 Phase 3 ▪ Employee communications from Pandemic Committee provided several times per week. Sanitization and safety measures reiterated reg ularly. ▪ Customer communications provided on a weekly basis (or more often as needed). ▪ Lobbies transition to “Appointment Only” operational model. Drive - thru remains open, with the exception of Mequon. ▪ Redeployment of front - line staff to high - priority projects and initiatives begin. ▪ SBA announces Paycheck Protection Program. SBA team meets daily to plan the rollout of the program. ▪ SBA PPP implemented. Team works around the clock to process applications and prepare loan documents. ▪ Pandemic Committee creates side committee to plan for reopening, with a focus on employee and customer safety. January 1 – February 29, 2020 March 1 - March 18, 2020 March 19 - April 17, 2020
Pandemic Committee Name Title Mike Molepske Chief Executive Officer Mike Dempsey President Kelly Fischer Chief Operating Officer Meghann Kasper Chief Credit Officer Kevin LeMahieu Chief Financial Officer Jeff Zimmerlee Chief Retail Officer Kelly Dvorak General Counsel Sherry Jonet Vice President – Human Resources Deb Weyker Vice President – Marketing Jason Krepline EVP – Region President; Senior Loan Officer Joan Woldt EVP – Region President Scott Tuma Enterprise Risk Officer Tom Omdahl Compliance / BSA Officer Sharol Schroeder AVP – Human Resources Shannon Klahn Assistant Executive Officer The Pandemic Committee consists of members of the Senior Management Team as well as individuals from key functions of the bank, each specializing in a specific skill set that adds value to the group . The committee initially met daily to discuss Bank First's response to the COVID - 19 Pandemic . Today, the group meets three times per week, with sub - committees meeting on a more regular basis as needed . The committee reviews the latest information from the Centers for Disease Control and Prevention (CDC) as well as all national, state, and local guidance . The team continues to review the business continuity plan to ensure we have appropriate measures in place that are responsive to the unique nature of this viral threat and minimize business disruptions while ensuring the safety of our employees, customers, and the community .
Branch Accessibility During Pandemic Office March 24, 2020 Lobby March 24, 2020 Drive - Thru April 14, 2020 Lobby April 14, 2020 Drive - Thru Appleton Appointment Only Open – Normal Hours CLOSED CLOSED Ashwaubenon Appointment Only Open – Normal Hours CLOSED CLOSED Bellevue Appointment Only Open – Normal Hours Appointment Only Open – Normal Hours Cedarburg Appointment Only Open – Normal Hours Appointment Only Open – Normal Hours Chetek Appointment Only Open – Normal Hours Appointment Only Open – Normal Hours Clintonville Appointment Only Open – Normal Hours Appointment Only Open – Normal Hours Iola Appointment Only Open – Normal Hours Appointment Only Open – Normal Hours Kiel Appointment Only Open – Normal Hours Appointment Only Open – Normal Hours Custer Appointment Only Open – Normal Hours Appointment Only Open – Normal Hours 8 th Street Appointment Only Open – Normal Hours Appointment Only Open – Normal Hours Mequon Appointment Only CLOSED Appointment Only CLOSED Mishicot Appointment Only Open – Normal Hours Appointment Only Open – Normal Hours Oshkosh Appointment Only Open – Normal Hours Appointment Only Open – Normal Hours Plymouth Appointment Only Open – Normal Hours Appointment Only Open – Normal Hours Seymour Appointment Only Open – Normal Hours Appointment Only Open – Normal Hours Sheboygan Appointment Only Open – Normal Hours Appointment Only Open – Normal Hours Tomah Appointment Only Open – Normal Hours Appointment Only Open – Normal Hours Two Rivers Appointment Only Open – Normal Hours Appointment Only Open – Normal Hours Valders Appointment Only Open – Normal Hours Appointment Only Open – Normal Hours Watertown Appointment Only Open – Normal Hours Appointment Only Open – Normal Hours Waupaca Appointment Only Open – Normal Hours Appointment Only Open – Normal Hours Weyauwega Appointment Only Open – Normal Hours Appointment Only Open – Normal Hours Acuity CLOSED N/A CLOSED N/A *Lobby Appointment Only and Drive - Thru re - opening 4/20/20 *Lobby Appointment Only and Drive - Thru re - opening 4/20/20
Operational Preparedness & Response We began stress testing departments and essential functions in mid - March to determine how each area would be impacted by employees working from home . The testing was overall successful, with no technological concerns noted . In mid - March, key operating functions were dispersed . Employees in these functions are not permitted to work in the same office and/or workspace together . 170 employees have the ability to work from home and have been encouraged to split time at home/in the office to limit exposure . Prepare Test Act EMPLOYEE DISPERSION
Operational Preparedness & Response ▪ Bank First had 120 users that could work remotely prior to the COVID - 19 pandemic, including key employees . ▪ 170 employees have VPN access to utilize check - out laptops in case of an emergency situation . ▪ Bank First already utilized GoToMeeting and GoToWebinar video conferencing platforms for meetings . As such, our users were well versed in using these platforms and transitioned to virtual meetings effortlessly . ▪ Our network infrastructure was already in place, allowing us to scale our work - from - home capabilities without additional investments in infrastructure . ▪ 35 additional laptops ordered and configured to accommodate increased work - from - home options . ▪ Employees required to review and make any necessary updates to their Emergency Contact Information . ▪ Key employees provided with cabling to outfit monitors and home office setups to increase productivity while working from home . ▪ Employees with laptops encouraged to work from home a couple days each week to limit exposure and conform with social distancing requirements . ▪ New intranet is launched early, giving all employees the ability to access important communications from the Pandemic Committee at anytime, anywhere without needing a bank - issued laptop . INFORMATION TECHNOLOGY Measures in Place Prior to Pandemic Measures Implemented in Response to Pandemic
Operational Preparedness & Response RETAIL LOAN OPERATIONS Rate Locks Coming Due Due to the low interest rate environment, Bank First has experienced record purchase/refinance volumes. The above chart reflects the number of rate locks coming due April – June 2020, compared to the same period last year. Retail Loan Operations has been focusing primarily on the following initiatives due to the current interest rate environment and pandemic: • Deferral Requests • Purchases • Refinances To assist with the increased volume of requests, seven members of our teller/CSR team have been trained and temporarily redeployed to Retail Loan Operations while our lobbies are closed. We have been working with our appraisers and customers to ensure both parties feel comfortable and safe conducting interior inspections . For those who wish not to have contact due to health concerns, Bank First started allowing customers to take pictures and/or video of their home . They then send this information to the appraiser so they can complete their work . May 2019 May 2020 38 159 June 2019 June 2020 39 112 April 2019 April 2020 26 108
Operational Preparedness & Response ▪ A dedicated team of Administrative Assistants and Processors have been assigned to prepare loan documents and process deferral requests to expedite the process of moving them through the system to help customers in financial distress/uncertainty . ▪ Over 50 employees were redeployed from the front line and other departments to assist with the SBA Paycheck Protection Program . Teams were created to help accept and process applications, prepare and review loan documents, send documents for electronic signature, and book/fund the loan . ▪ Employees working on the Paycheck Protection Program have been working nights and weekends (including on Easter) to process applications . Assisting our customers during this challenging time is a top priority . COMMERCIAL LOAN OPERATIONS SBA Task Force Meghann Kasper Chief Credit Officer Kelly Fischer Chief Operating Officer Mike Dempsey President Jason Krepline EVP – Region President; Senior Loan Officer Joan Woldt EVP – Region President Derek Klahn AVP – Business Banking Kyle Von Haden AVP - Credit Laura Lederer Administrative Assistant (Admin SBA Lead) An SBA Task Force was created to navigate the various programs being rolled out as part of the CARES Act. This taskforce helped successfully launch the Paycheck Protection Program for Bank First. 50+ employees redeployed to help
Regularly scheduled training done via webinar format Operational Preparedness & Response BRANCH OPERATIONS > > > > > > Travel restricted among branches Gloves, masks, hand sanitizer, wipes, and antibacterial spray provided to each office Teller/CSR group working on updating customer information in the core system during lobby closures New Intranet has helped provide essential communication and additional training opportunities Employees encouraged to sanitize their hands and workstations after each customer interaction
• Courier routes reduced to one visit per office per week. Loan files with wet signatures are being mailed overnight to avoid issues with selling deadlines. • Customer courier deposit pickup service has been reduced to one day per week. • New building projects delayed to continue social distancing. Operational Preparedness & Response FACILITIES
" We have a social responsibility and federal mandate to serve our customers and communities. Doing so while ensuring the health, safety, and financial well - being of our employees is a top priority." - Mike Molepske, CEO and President EMPLOYEES ARE OUR BIGGEST ASSET Employee Protection & Assistance
Humana, our insurance provider, announced that they will be waiving out - of - pocket costs associated with testing for COVID - 19 for patients who meet CDC guidelines at approved laboratory locations. Additionally, Humana will be waiving the cost of telemedic ine for urgent care. To encourage our employees to stay home if they are at risk of infecting others, we modified our time off policy to allow employees to use FMLA hours. Employees were required to stay home for 14 days if: • They had a fever greater than 100.4. • They traveled to a Level 3 country as defined by the WHO or went on a cruise. Implemented more stringent sanitation measures and added New York, Washington, and California to list of travel destinations requiring 14 - day quarantine upon return. Worked on staffing needs to address shortages regarding employees with children impacted by school and daycare closures. Began offering Pandemic Pay to employees if their time away from work extended past the 80 - hour requirement. Pandemic Pay allows the employee to be fully compensated or at minimum compensated for 2/3 of their pay (depending on the circumstance) for up to 12 weeks. Humana announced that all COVID - 19 medical expenses would be covered without deductibles and co - pays. Employees have access to EAP and Doctor on Demand to video conference a doctor or counselor when needed. EMPLOYEE ASSISTANCE Employee Protection & Assistance MARCH 12 MARCH 12 MARCH 18 MARCH 18 APRIL 1 APRIL 2 ALWAYS
Employees have the ability to work from home (VPN). 155 Laptops previously deployed. 35 Additional laptops deployed due to COVID. EMPLOYEE ASSISTANCE Employee Protection & Assistance 170 Employees periodically in/out due to childcare needs. 13 14 Employees were out for symptoms/self - quarantining that don’t have the ability to work from home . 10 of those employees have already returned to work. Employees working at the office. 107 304 TOTAL EMPLOYEES
All employees are encouraged each year to get a flu shot. Bank First reimburses up to $25 if there is a cost involved. Tissue boxes and face masks sent to each office. Medical gloves and additional hand sanitizer ordered for each office. Offices educated on sanitization procedures. Started practicing social distancing. Relaxed the dress code to include casual attire and jeans to ensure employees could wash their clothes daily instead of needing to be dry cleaned. Employees encouraged to work from home when possible to protect themselves and coworkers. Started requiring that all employees take their temperature before coming into work. Bank First will reimburse up to $25 for the cost of a thermometer. Employees required to either use gloves or sanitize hands after each instance of handling cash. Mask use mandatory during customer appointments in our offices. Employees encouraged to wear mask when working within 6 feet of others. Couriers required to now use masks when entering each office. EMPLOYEE PROTECTION Employee Protection & Assistance EVERY YEAR MARCH 12 MARCH 16 MARCH 18 MARCH 19 APRIL 5 APRIL 10 APRIL 10
• We have asked all our offices to order in lunch once per week from a customer for the benefit of our employees and our customers. • As a thank you to our employees for their hard work and dedication and to help our customers, we will be giving out $50 gift cards to local restaurants. • On March 31, we announced that no employees would be laid off due to the COVID - 19 pandemic. Job duties have been shifted to redeploy staffing where needed. EMPLOYEE GRATITUDE Employee Protection & Assistance
Employee Communication & Education INTRANET SITE Beginning March 13 : We created a dedicated page on our new Intranet site to communicate important updates surrounding COVID - 19 to employees . Employees have access to this site anytime, anywhere .
Bank First has taken an “all hands on deck” approach to serve our customers as well as other businesses in the communities we serve to ensure they are getting the support they need. Providing effective communication to our customers during this challenging time has been a top priority of Bank First. SUPPORTING CUSTOMERS IN A TIME OF NEED Supporting our Customers
PERSONAL LOAN CUSTOMERS Fannie Mae & Freddie Mac • Forbearance programs rolled out. 6 months deferral of payment and escrow with a potential for another 6 months. No credit bureau reporting during forbearance. Supporting Our Customers 1,114 AS OF APRIL 17, 2020 48 CUSTOMER REQUESTS $8.1 MILLION 1,114 AS OF APRIL 17, 2020 89 CUSTOMER REQUESTS $17 In House Mortgage and Consumer Loan Programs • Deferring payment and escrow for 2 months with an option of an additional 2 months. • Deferral months are added to the end of the loan to extend the maturity date. • Suspended foreclosure actions on residential properties for 60 days, unless required by federal or government agencies. • Suspended repossession actions for 60 days for vehicles, boats, and RVs. MILLION
Deferral Requests Bank First is offering business customers six - month principal deferrals. Deferred principal will balloon at maturity. Supporting Our Customers 1,114 AS OF APRIL 17, 2020 89 DEFERRAL REQUESTS $174 MILLION SBA Paycheck Protection Program • As a Preferred SBA Lender, Bank First is proud to participate in the Paycheck Protection Program (PPP) . Our team has been working around the clock (including nights, weekends, and holidays) to assist customers . • At a time when many of the big banks and non - SBA community banks and credit unions are choosing not to participate in this program, Bank First has taken an “all hands on deck” approach to serve our customers as well as other businesses in our community that are not getting the support they need . 1,114 AS OF APRIL 17, 2020 PPP LOANS APPROVED $245 MILLION 1,236 BUSINESSES SERVED BUSINESS LOAN CUSTOMERS
Supporting Our Customers DEPOSITORY CUSTOMERS • We are waiving the early withdrawal penalties on CDs. • We are waiving telephone transfer fees. • We are waiving overdraft fees based on request. 76 NEW DEPOSITORY RELATIONSHIPS AS A RESULT OF ASSISTING BUSINESSES IN THE PAYCHECK PROTECTION PROGRAM. zero fee
Supporting Our Customers DIGITAL BANKING EFFORTS • Encouraging customers to utilize Bank First’s digital services, such as Retail and Mobile Banking. • Added online account opening to our website. • Encouraging customers to apply online using our new mortgage application system. • Encouraging peer - to - peer payment platforms as opposed to handling cash. • Encouraging the use of Digital W allet to reduce cash handling at point of purchase. • Created the ability to schedule appointments online. Currently receiving approximately 10 - 15 requests per day. MARCH 1 APRIL 13 21,036 22,159 PERSONAL ONLINE BANKING 5.34% INCREASE MARCH 1 APRIL 13 10,610 11,096 PERSONAL MOBILE BANKING 4.60% INCREASE MARCH 1 APRIL 13 3,918 4,090 BUSINESS ONLINE BANKING 4.39% INCREASE MARCH 1 APRIL 13 387 406 BUSINESS MOBILE BANKING 4.91% INCREASE CUSTOMERS ENROLLED
Supporting Our Customers CUSTOMER FEEDBACK “Thank you again. You have been great to work with. Very informative. Very responsive. Have a great day!" “Hi Nathan, Yes , beers ASAP – this COVID has got to go! Thank you for helping Beth with the PPP loan stuff. She was raving about you and really appreciated all your assistance. You the man !” "Bank First did a phenomenal job of processing this! Glad we have them on our team." “I cannot express how thankful we are to have gotten this opportunity to do business with you, and I would like to continue to stay in touch and learn more about Bank First. Thanks again for everything. You have a great team." “Hi Joan, I just want to applaud you on how well Bank First is handling this. Most other banks and credit unions haven't even sent the applications in as I have talked to many other business owners who are frustrated with their banks and credit unions . Bank First is working hard to help their customers and community, even at off times such as Sunday morning. My thanks to all of the Bank First team in all of the communities they serve for their extraordinary efforts in these unprecedented times." " My husband and I have been working with your commercial lender, Rahim Keval, during this past week in processing both of our respective businesses PPP SBA Care Act loans. We cannot give enough praise on how well Mr. Keval has conducted himself during this very busy, stressful and questionable time in our economy." "I wanted to relay you have a very pleased customer that appreciates your help with navigating the Federal Relief maze. Equally important, I have no doubt that word will travel that Bank First is working hard to help their customers and community, even on Sundays.” “I was so happy to find out that Bank First was SBA - approved to process PPP loans. Your dedicated employee, Derek Klahn, helped us obtain a PPP loan. Derek did a great job fielding all our questions and was super efficient getting our loan application processed. Because of his diligence, our loan has already been funded. “Hi Jim, I wanted to let you know that it appears from us as outside observers that your Bank is doing a great job with this process. A lot of our clients who are using other Banks are having a much more challenging time."
Customer Communication & Education WEBSITE COMMUNICATION Created Alert Banner and Link containing news and updates about COVID - 19 on our website Letter from CEO: COVID - 19 Response Letter from CEO: COVID - 19 Update Launched “Schedule An Appointment” form on our website for customers Content added regarding our customer relief efforts Letter from CEO: COVID - 19 Customer Relief Efforts Content added regarding scams Letter from CEO: Scammers are taking advantage of COVID - 19 Content added regarding the CARES Act and PPP program Letter from CEO: CARES Act and the Paycheck Protection Program (PPP) Content added regarding small business relief options Letter from CEO: Update - SBA Coronavirus Relief Options for Small Businesses Content added regarding the Paycheck Protection Program Letter from CEO: Important Information Regarding the Paycheck Protection Program Letter from CEO: Update on the Paycheck Protection Program Letter from CEO: Protect Your Economic Impact Payment: Scams to Watch Out For MARCH 13 MARCH 16 MARCH 20 MARCH 23 MARCH 24 MARCH 24 MARCH 30 MARCH 30 APRIL 2 APRIL 2 APRIL 3 APRIL 3 APRIL 4 APRIL 4 APRIL 11 APRIL 14
Customer Communication & Education EMAIL COMMUNICATION Beginning March 16: Letters from the CEO sent to customers: • COVID - 19 Response • COVID - 19 Update • COVID - 19 Customer Relief Efforts • Scammers are taking advantage of COVID - 19 • CARES Act and the Paycheck Protection Program (PPP) • Update - SBA Coronavirus Relief Options for Small Businesses • Important Information Regarding the Paycheck Protection Program • Update on the Paycheck Protection Program • Protect Your Economic Impact Payment: Scams to Watch Out For
Customer Communication & Education SOCIAL MEDIA SITES Beginning March 14: • Began publishing informative information to our followers on: Facebook - @bankfirstwisconsin LinkedIn - @bankfirst - wi Instagram - @bankfirstwi
Supporting Our Community SUPPORTING LOCAL RESTAURANTS Bank First recently purchased $ 100 , 000 in gift cards from over 140 local restaurants . These gift cards will be donated back to local families, non - profit organizations, and businesses through various programs once the Safer - At - Home restrictions are lifted .
Bank First will continue to be one of the top - performing providers of financial services in Wisconsin. Bank First will create value for the communities and customers we serve, resulting in exceptional return for our shareholders. We will continue to grow relationship deposits and lend those funds to invest in and support the communities we serve, yielding superior growth in earnings per share. IMPACT OF COVID - 19 ON PERFORMANCE Financial Impact
COVID - 19 Impact on Financial Performance PAYCHECK PROTECTION PROGRAM As of April 17, 2020 1,236 Applications Submitted to Bank First Customers Non - Customers 1,144 92 1,236 Applications Approved By SBA Customers Non - Customers $205 Million $40 Million $245 Million Approved 1,114 Fees Expected to be Collected $8.2 MILLION 1,114 Fees Paid to 3rd Party Agents $0.1 MILLION 76 NEW Depository Relationships
COVID - 19 Impact on Financial Performance BALANCE SHEET CONSIDERATIONS Bank First Loan Composition as of March 31, 2020 $ 1.8 billion Commercial Real Estate Composition as of March 31, 2020 $954 m illion Construction & Development Composition as of March 31, 2020 $104 m illion
COVID - 19 Impact on Financial Performance ASSET QUALITY Non - Performing Assets/Consolidated Assets as of March 31 ▪ Bank First entered this time of heightened economic turbulence with strong asset quality metrics . ▪ While there is great uncertainty over the impact of the current health crisis on credit quality of all financial institutions going forward, Bank First has maintained a consistently conservative credit culture that allowed it to weather the Great Recession from 2008 - 2011 with continually increasing earnings each year . ▪ Bank First's ability to transform its credit culture is evidenced with the Waupaca loan portfolio brought on in October 2017 , which resulted in a notable spike in non - performing assets . Within just two years, Bank First reduced non - performing assets to consolidated assets from 1 . 47 % to 0 . 51 % , putting it more in line with historical levels . ▪ Actual credit quality deterioration will depend heavily on the length of time that local and national economies remain under the various “stay at home” orders issued by each state . The longer these orders stay in place, the greater the stress will be on the economy . Management will continue to monitor these factors in its decision - making practices .
COVID - 19 Impact on Financial Performance LIQUIDITY * Calculated as cash, due from banks, interest - bearing deposits, federal funds sold and FHLB borrowing capacity • Quick liquidity indicates funds immediately available. • This measure does not include available access to liquidity through brokered deposits, liquidation of securities, federal funds purchased, and other items. • Cash intensive acquisition of Waupaca during October 2017 reduced liquidity. It has been rebuilt to historically high levels within two years. • The Federal Reserve has also introduced a lending facility to finance Paycheck Protection Program loans if needed. 387.8 304.1 375.8 425.2 MAR - 17 MAR - 18 MAR - 19 MAR - 20 QUICK LIQUIDITY * ( IN MILLIONS)
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