8-K

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UNITED STATESSECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

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FORM 8-K CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OFTHE SECURITIES EXCHANGE ACT OF 1934

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July 29, 2021

Date of Report

(Date of earliest event reported)

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BRIDGEWATER BANCSHARES, INC.

(Exact name of registrant as specified in its charter)

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​<br><br>​<br><br>​	​<br><br>​	​<br><br>​<br><br>​
Minnesota<br><br>(State or other jurisdiction of<br><br>incorporation)<br><br>​	001-38412<br><br>(Commission File Number)	26-0113412<br><br>(I.R.S. Employer<br><br>Identification No.)
​	4450 Excelsior Boulevard, Suite 100<br><br>St. Louis Park , Minnesota<br><br>(Address of principal executive offices)	55416<br><br>(Zip Code)

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Registrant’s telephone number, including area code: (952) 893-6868

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Not Applicable(Former name or former address, if changed since last report.)

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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:

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☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

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☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

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☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

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☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

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Securities registered pursuant to Section 12(b) of the Act:

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Title of each class:	Trading Symbol	Name of each exchange on which registered:
Common Stock, $0.01 Par Value	BWB	The Nasdaq Stock Market LLC

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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).

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Emerging growth company ☒

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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐ ​ ​ ​

Item 2.02 Results of Operations and Financial Condition .

On July 29, 2021, Bridgewater Bancshares, Inc. (the “Company”) issued a press release announcing its financial results for the three and six months ended June 30, 2021. A copy of the press release is attached as Exhibit 99.1 to this Form 8-K and is incorporated herein by reference.

The information furnished in this item of this Form 8-K, and the related exhibits, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as may be expressly set forth by specific reference in such filing.

Item 7.01 Regulation FD Disclosure .

The Company hereby furnishes the Investor Presentation attached hereto as Exhibit 99.2.

The information furnished in this item of this Form 8-K, and the related exhibits, shall not be deemed “filed” for purposes of Section 18 of the Exchange Act, or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as may be expressly set forth by specific reference in such filing.

Item 9.01           Financial Statements and Exhibits.

(d)****Exhibits

Exhibit 99.1	Press release of Bridgewater Bancshares, Inc., dated July 29, 2021, regarding second quarter 2021 financial results
Exhibit 99.2	Investor Presentation dated July 29, 2021
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Exhibit 104	Cover Page Interactive Data File (embedded within the Inline XBRL document)
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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

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​	Bridgewater Bancshares, Inc.
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Date: July 29, 2021	​
​	By: /s/ Jerry Baack
​	Name: Jerry Baack
​	Title: Chairman, Chief Executive Officer and President

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​ 2

Exhibit 99.1

Bridgewater Bancshares, Inc. Announces Record Second Quarter 2021 Net Income of $11.0 Million, $0.38 Diluted Earnings Per Common Share

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Bridgewater Bancshares, Inc. (Nasdaq: BWB) (the Company), the parent company of Bridgewater Bank (the Bank), today announced net income of $11.0 million for the second quarter of 2021, a 3.0% increase over net income of $10.7 million for the first quarter of 2021, and a 44.7% increase over net income of $7.6 million for the second quarter of 2020. Net income per diluted common share for the second quarter of 2021 was $0.38, a 2.4% increase compared to $0.37 per diluted common share for the first quarter of 2021, and a 44.9% increase, compared to $0.26 per diluted common share for the same period in 2020.

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“Bridgewater reported another quarter of record net income driven by robust organic loan growth, superb asset quality and a highly efficient business model,” said Chairman, Chief Executive Officer, and President, Jerry Baack. “Our unique ability to generate profitable loan growth in the current market has been the result of client acquisition opportunities from M&A-related market disruption, the expansion of our lending teams through opportunistic hires, and our strong brand and service model in the Twin Cities. This loan growth, along with a stabilizing core net interest margin, has led to continued revenue growth, all while maintaining consistently low levels of net charge-offs and nonperforming assets. With our proven growth engine and an efficiency ratio among the lowest in the industry, we believe we are well-positioned to continue gaining market share in the attractive Twin Cities market.”

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Second Quarter 2021 Financial Results

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​	​	​	​	​	​	​	​	​	​	​	​
​	​	​	**** ​	​	**** ​	Diluted		​	Nonperforming	**** ​	Adjusted
ROA	​	PPNR ROA ^(1)^	****	ROE	****	earnings per share		​	assets to total assets	****	efficiency ratio ^(1)^
1.43%	​	2.07%	​	15.40%	​	$	0.38	​	0.02%	​	41.5%

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(1)	Represents a non-GAAP financial measure. See "Non-GAAP Financial Measures" for further details.

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Second Quarter 2021 Highlights

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●	Diluted earnings per common share were $0.38 for the second quarter of 2021, compared to $0.37 per common share for the first quarter of 2021.

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●	Annualized return on average assets (ROA) and annualized return on average common equity (ROE) for the second quarter of 2021 were 1.43% and 15.40%, compared to ROA and ROE of 1.47% and 15.87%, respectively, for the first quarter of 2021.

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●	Pre-provision net revenue (PPNR), a non-GAAP financial measure, was $15.9 million for the second quarter of 2021, an increase of 1.6%, compared to $15.6 million from the first quarter of 2021. PPNR ROA, a non-GAAP financial measure, was 2.07% for the second quarter of 2021, compared to 2.15% for the first quarter of 2021.

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●	Gross loans increased $168.1 million in the second quarter of 2021, or 27.8% annualized, compared to the first quarter of 2021. Gross loans, excluding Paycheck Protection Program (PPP) loans, increased $232.2 million in the second quarter of 2021, or 41.2% annualized, compared to the first quarter of 2021.

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●	Deposits increased $82.3 million in the second quarter of 2021, or 12.5% annualized, compared to the first quarter of 2021.

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●	Net interest margin was 3.52% for the second quarter of 2021, compared to 3.60% in the first quarter of 2021.

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●	The adjusted efficiency ratio, a non-GAAP financial measure which excludes the impact of certain non-routine income and expenses from noninterest expense, was 41.5% for the second quarter of 2021, compared to 40.7% for the first quarter of 2021.

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●	A loan loss provision of $1.6 million was recorded in the second quarter of 2021 to support strong organic loan growth. The allowance for loan losses to total loans was 1.45% at June 30, 2021, compared to 1.48% at March 31, 2021. The allowance for loan losses to total loans, excluding PPP loans, was 1.50% at June 30, 2021, compared to 1.59% at March 31, 2021.

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●	Annualized net loan charge-offs (recoveries) as a percentage of average loans were 0.00% for the second quarter of 2021, compared to (0.01)% for the first quarter of 2021.

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●	Tangible book value per share, a non-GAAP financial measure, increased 4.3%, or $0.42, to $10.22 at June 30, 2021, compared to $9.80 at March 31, 2021.

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●	The Company purchased $25.0 million of bank owned life insurance policies on certain officers.

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​ Page 1 of 17

Recent Developments

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On July 8, 2021, the Company announced the completion of a private placement of $30.0 million in aggregate principal amount of 3.25% fixed-to-floating rate subordinated notes due 2031. The Company intends to use the net proceeds of the private placement for general corporate purposes, including support for organic growth plans, support for bank level capital ratios and possible redemption or repurchase of currently outstanding indebtedness.

​ Page 2 of 17

Key Financial Measures

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​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	As of and for the Three Months Ended									​	As of and for the Six Months Ended
​	​	June 30,		​	March 31,		​	June 30,			​	June 30,		​	June 30,
​	****	2021		​	2021		​	2020			****	2021		****	2020
Per Common Share Data	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Basic Earnings Per Share	​	$	0.39	​	$	0.38	​	$	0.26	​	​	$	0.77	​	$	0.52	​
Diluted Earnings Per Share	​	​	0.38	​	​	0.37	​	​	0.26	​	​	​	0.75	​	​	0.51	​
Book Value Per Share	​	​	10.33	​	​	9.92	​	​	8.92	​	​	​	10.33	​	​	8.92	​
Tangible Book Value Per Share ^(1)^	​	​	10.22	​	​	9.80	​	​	8.80	​	​	​	10.22	​	​	8.80	​
Basic Weighted Average Shares Outstanding	​	​	28,040,762	​	​	28,017,366	​	​	28,676,441	​	​	​	28,029,129	​	​	28,733,968	​
Diluted Weighted Average Shares Outstanding	​	​	29,128,181	​	​	28,945,212	​	​	29,165,157	​	​	​	29,048,424	​	​	29,350,426	​
Shares Outstanding at Period End	​	​	28,162,777	​	​	28,132,929	​	​	28,837,560	​	​	​	28,162,777	​	​	28,837,560	​
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Selected Performance Ratios	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Return on Average Assets (Annualized)	​	​	1.43	%	​	1.47	%	​	1.17	%	​	​	1.45	%	​	1.22	%
Pre-Provision Net Revenue Return on Average Assets (Annualized) ^(1)^	​	​	2.07	​	​	2.15	​	​	2.00	​	​	​	2.11	​	​	2.05	​
Return on Average Common Equity (Annualized)	​	​	15.40	​	​	15.87	​	​	11.98	​	​	​	15.63	​	​	11.96	​
Return on Average Tangible Common Equity (Annualized)^(1)^	​	​	15.58	​	​	16.06	​	​	12.14	​	​	​	15.81	​	​	12.12	​
Yield on Interest Earning Assets	​	​	4.17	​	​	4.31	​	​	4.45	​	​	​	4.24	​	​	4.66	​
Yield on Total Loans, Gross	​	​	4.56	​	​	4.74	​	​	4.85	​	​	​	4.64	​	​	5.00	​
Cost of Interest Bearing Liabilities	​	​	0.96	​	​	1.04	​	​	1.58	​	​	​	1.00	​	​	1.70	​
Cost of Total Deposits	​	​	0.54	​	​	0.59	​	​	0.99	​	​	​	0.56	​	​	1.12	​
Net Interest Margin ^(2)^	​	​	3.52	​	​	3.60	​	​	3.38	​	​	​	3.56	​	​	3.48	​
Core Net Interest Margin ^(1)(2)^	​	​	3.31	​	​	3.34	​	​	3.22	​	​	​	3.33	​	​	3.29	​
Efficiency Ratio^(1)^	​	​	42.0	​	​	41.2	​	​	48.6	​	​	​	41.6	​	​	46.5	​
Adjusted Efficiency Ratio ^(1)^	​	​	41.5	​	​	40.7	​	​	40.4	​	​	​	41.1	​	​	42.2	​
Noninterest Expense to Average Assets (Annualized)	​	​	1.50	​	​	1.51	​	​	1.64	​	​	​	1.50	​	​	1.67	​
Adjusted Noninterest Expense to Average Assets (Annualized) ^(1)^	​	​	1.48	​	​	1.49	​	​	1.37	​	​	​	1.48	​	​	1.51	​
Loan to Deposit Ratio	​	​	95.3	​	​	91.9	​	​	97.8	​	​	​	​	​	​	​	​
Core Deposits to Total Deposits^(3)^	​	​	81.2	​	​	83.5	​	​	75.7	​	​	​	​	​	​	​	​
Tangible Common Equity to Tangible Assets ^(1)^	​	​	9.10	​	​	8.99	​	​	9.23	​	​	​	​	​	​	​	​
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Capital Ratios (Bank Only) ^(4)^	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Tier 1 Leverage Ratio	​	​	10.57	%	​	10.65	%	​	11.36	%	​	​	​	​	​	​	​
Tier 1 Risk-based Capital Ratio	​	​	11.24	​	​	12.08	​	​	12.96	​	​	​	​	​	​	​	​
Total Risk-based Capital Ratio	​	​	12.49	​	​	13.33	​	​	14.21	​	​	​	​	​	​	​	​
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Capital Ratios (Consolidated)^(4)^	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Tier 1 Leverage Ratio	​	​	9.08	%	​	9.11	%	​	9.94	%	​	​	​	​	​	​	​
Tier 1 Risk-based Capital Ratio	​	​	9.67	​	​	10.34	​	​	11.39	​	​	​	​	​	​	​	​
Total Risk-based Capital Ratio	​	​	13.49	​	​	14.46	​	​	15.99	​	​	​	​	​	​	​	​

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(1)	Represents a non-GAAP financial measure. See "Non-GAAP Financial Measures" for further details.
(2)	Amounts calculated on a tax-equivalent basis using the statutory federal tax rate of 21%.
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(3)	Core deposits are defined as total deposits less brokered deposits and certificates of deposit greater than $250,000.
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(4)	Preliminary data. Current period subject to change prior to filings with applicable regulatory agencies.
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​ Page 3 of 17

Selected Financial Data

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​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	June 30,		​	March 31,		​	December 31,		​	September 30,		​	June 30,
(dollars in thousands)	****	2021		****	2021		​	2020		​	2020		​	2020
Selected Balance Sheet Data	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Total Assets	​	$	3,162,612	​	$	3,072,359	​	$	2,927,345	​	$	2,774,564	​	$	2,754,463
Total Loans, Gross	​	​	2,594,186	​	​	2,426,123	​	​	2,326,428	​	​	2,259,228	​	​	2,193,778
Allowance for Loan Losses	​	​	37,591	​	​	35,987	​	​	34,841	​	​	31,381	​	​	27,633
Goodwill and Other Intangibles	​	​	3,200	​	​	3,248	​	​	3,296	​	​	3,344	​	​	3,391
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Deposits	​	​	2,720,906	​	​	2,638,654	​	​	2,501,636	​	​	2,273,044	​	​	2,242,051
Tangible Common Equity^(1)^	​	​	287,630	​	​	275,923	​	​	262,109	​	​	262,088	​	​	253,799
Total Shareholders' Equity	​	​	290,830	​	​	279,171	​	​	265,405	​	​	265,432	​	​	257,190
Average Total Assets - Quarter-to-Date	​	​	3,076,712	​	​	2,940,262	​	​	2,816,032	​	​	2,711,755	​	​	2,622,272
Average Common Equity - Quarter-to-Date	​	​	286,311	​	​	272,729	​	​	265,716	​	​	263,195	​	​	255,109

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(1)Represents a non-GAAP financial measure. See "Non-GAAP Financial Measures" for further details.

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​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	For the Three Months Ended								​	For the Six Months Ended
​	​	June 30,		​	March 31,		​	June 30,		​	June 30,		​	June 30,
(dollars in thousands)	​	2021		​	2021		****	2020		​	2021		****	2020
Selected Income Statement Data	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Interest Income	​	$	31,147	​	$	30,440	​	$	28,166	​	$	61,587	​	$	55,634
Interest Expense	​	​	4,859	​	​	5,045	​	​	6,824	​	​	9,904	​	​	14,190
Net Interest Income	​	​	26,288	​	​	25,395	​	​	21,342	​	​	51,683	​	​	41,444
Provision for Loan Losses	​	​	1,600	​	​	1,100	​	​	3,000	​	​	2,700	​	​	5,100
Net Interest Income after Provision for Loan Losses	​	​	24,688	​	​	24,295	​	​	18,342	​	​	48,983	​	​	36,344
Noninterest Income	​	​	1,603	​	​	1,008	​	​	1,977	​	​	2,611	​	​	3,696
Noninterest Expense	​	​	11,477	​	​	10,923	​	​	10,711	​	​	22,400	​	​	20,457
Income Before Income Taxes	​	​	14,814	​	​	14,380	​	​	9,608	​	​	29,194	​	​	19,583
Provision for Income Taxes	​	​	3,821	​	​	3,709	​	​	2,010	​	​	7,530	​	​	4,542
Net Income	​	$	10,993	​	$	10,671	​	$	7,598	​	$	21,664	​	$	15,041

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Income Statement

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Net Interest Income

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Net interest income was $26.3 million for the second quarter of 2021, an increase of $893,000, or 3.5%, from $25.4 million in the first quarter of 2021, and an increase of $4.9 million, or 23.2%, from $21.3 million in the second quarter of 2020. The linked-quarter and year-over-year increases in net interest income were primarily due to growth in average interest earning assets, lower rates paid on deposits, and the recognition of PPP loan origination fees, offset partially by declining yields on loans. Average interest earning assets were $3.02 billion for the second quarter of 2021, an increase of $136.4 million, or 4.7%, from $2.88 billion for the first quarter of 2021, and an increase of $452.1 million, or 17.6%, from $2.57 billion for the second quarter of 2020. The linked-quarter increase in average interest earning assets was primarily due to robust organic growth in the loan portfolio. The year-over-year increase in average interest earning assets was primarily due to strong organic growth in the loan portfolio, as well as continued purchases of investment securities.

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Net interest margin (on a fully tax-equivalent basis) for the second quarter of 2021 was 3.52%, an 8 basis point decline from 3.60% in the first quarter of 2021, and a 14 basis point increase from 3.38% in the second quarter of 2020. Core net interest margin (on a fully tax-equivalent basis), a non-GAAP financial measure which excludes the impact of loan fees and PPP balances, interest, and fees, for the second quarter of 2021 was 3.31%, a 3 basis point decline from 3.34% in the first quarter of 2021, and a 9 basis point increase from 3.22% in the second quarter of 2020.

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While the origination volume of PPP loans earning 1.00% negatively impacted net interest margin, the recognition of fees associated with the originations has benefited net interest margin for each of the past three quarters. The SBA began forgiving PPP loans, which has accelerated the recognition of PPP fees starting in the fourth quarter of 2020 and continuing into the second quarter of 2021. The Company recognized $1.4 million of PPP origination fees during the second quarter of 2021, compared to $1.5 million during the first quarter of 2021. The elevated fee recognition is illustrated in the 4.75% PPP loan yield for the second quarter of 2021.

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​ Page 4 of 17

The following table summarizes PPP loan originations and net origination fees as of June 30, 2021:

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​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	Originated					​	Outstanding					​	Program Lifetime
​	​	Number		​	Principal		​	Number		​	Principal		​	Net Origination		​	Net Origination
(dollars in thousands)	****	of Loans		****	Balance		****	of Loans		****	Balance		****	Fees Generated		****	Fees Earned
Round One PPP Loans	​	​	1,200	​	$	181,600	​	​	225	​	$	27,184	​	$	5,706	​	$	5,330
Round Two PPP Loans	​	​	651	​	​	78,386	​	​	606	​	​	71,888	​	​	3,544	​	​	498
Totals	​	​	1,851	​	$	259,986	​	​	831	​	$	99,072	​	$	9,250	​	$	5,828

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Interest income was $31.1 million for the second quarter of 2021, an increase of $707,000, or 2.3%, from $30.4 million in the first quarter of 2021, and an increase of $3.0 million, or 10.6%, from $28.2 million in the second quarter of 2020. The yield on interest earning assets (on a fully tax-equivalent basis) was 4.17% in the second quarter of 2021, compared to 4.31% in the first quarter of 2021, and 4.45% in the second quarter of 2020. The linked-quarter decrease in the yield on interest earning assets was primarily due to the historically low interest rate environment resulting in a lower loan yield and lower loan fees recognized, offset partially by $1.4 million of PPP loan origination fees. The year-over-year decline in the yield on interest earning assets was primarily due to the historically low interest rate environment resulting in lower loan and security yields.

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Loan interest income and loan fees remain the primary contributing factors to the changes in yield on interest earning assets. The aggregate loan yield, excluding PPP loans, decreased to 4.54% in the second quarter of 2021, which was 18 basis points lower than 4.72% in the first quarter of 2021, and 47 basis points lower than 5.01% in the second quarter of 2020. While loan fees have maintained a relatively stable contribution to the aggregate loan yield, the historically low yield curve has resulted in a declining core yield on loans in comparison to both prior periods.

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A summary of interest and fees recognized on loans, excluding PPP loans, for the periods indicated is as follows:

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​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	Three Months Ended													​
​	​	June 30, 2021	​	​	March 31, 2021	​	​	December 31, 2020	​	​	September 30, 2020	​	​	June 30, 2020	****
Interest	​	4.37	%	​	4.50	%	​	4.59	%	​	4.69	%	​	4.76	%
Fees	​	0.17	​	​	0.22	​	​	0.28	​	​	0.24	​	​	0.25	​
Yield on Loans, Excluding PPP Loans	​	4.54	%	​	4.72	%	​	4.87	%	​	4.93	%	​	5.01	%

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Interest expense was $4.9 million for the second quarter of 2021, a decrease of $186,000, or 3.7%, from $5.0 million in the first quarter of 2021, and a decrease of $2.0 million, or 28.8%, from $6.8 million in the second quarter of 2020. The cost of interest bearing liabilities declined 8 basis points on a linked-quarter basis from 1.04% in the first quarter of 2021 to 0.96% in the second quarter of 2021, primarily due to lower rates paid on deposits. On a year-over-year basis, the cost of interest bearing liabilities decreased 62 basis points from 1.58% in the second quarter of 2020 to 0.96% in the second quarter of 2021, primarily due to lower rates paid on deposits, the payoff of the Company’s notes payable, and the early extinguishment of $94.0 million of longer term FHLB advances, offset partially by strong growth of interest bearing deposits and additional subordinated debentures.

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Interest expense on deposits was $3.5 million for the second quarter of 2021, a decrease of $159,000, or 4.3%, from $3.7 million in the first quarter of 2021, and a decrease of $1.7 million, or 32.1%, from $5.2 million in the second quarter of 2020. The cost of total deposits declined 5 basis points on a linked-quarter basis from 0.59% in the first quarter of 2021, and declined 45 basis points on a year-over-year basis from 0.99% in the second quarter of 2020, to 0.54% in the second quarter of 2021, primarily due to deposit rate cuts consistent with a lower rate environment and the downward repricing of time deposits. The Company anticipates more opportunities to lower the cost of total deposits due to continued deposit repricing as time deposits mature and the recent success of adding efficient, low-cost brokered deposits.

​ Page 5 of 17

A summary of the Company’s average balances, interest yields and rates, and net interest margin for the three months ended June 30, 2021, March 31, 2021, and June 30, 2020 is as follows:

​

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	For the Three Months Ended																							****
​	​	June 30, 2021							​	March 31, 2021							****	June 30, 2020							****
​	​	Average		​	Interest		​	Yield/	​	Average		​	Interest		​	Yield/	****	Average		​	Interest		​	Yield/	****
​	****	Balance		****	& Fees		****	Rate	****	Balance		****	& Fees		****	Rate	****	Balance		****	& Fees		****	Rate	****
(dollars in thousands)	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Interest Earning Assets:	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Cash Investments	​	$	88,067	​	$	33	​	0.15	%	$	105,477	​	$	34	​	0.13	%	$	109,073	​	$	37	​	0.14	%
Investment Securities:	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Taxable Investment Securities	​		314,049	​		1,647	​	2.10	​		301,680	​		1,723	​	2.32	​		203,559	​		1,304	​	2.58	​
Tax-Exempt Investment Securities^(1)^	​		77,029	​		842	​	4.38	​		80,963	​		881	​	4.41	​		91,793	​		996	​	4.37	​
Total Investment Securities	​		391,078	​		2,489	​	2.55	​		382,643	​		2,604	​	2.76	​		295,352	​		2,300	​	3.13	​
Paycheck Protection Program Loans ^(2)^	​		149,312	​	​	1,767	​	4.75	​		148,881	​	​	1,864	​	5.08	​		139,235	​	​	873	​	2.52	​
Loans ^(1)(2)^	​	​	2,384,759	​	​	27,011	​	4.54	​	​	2,241,038	​	​	26,074	​	4.72	​	​	2,013,163	​	​	25,070	​	5.01	​
Total Loans	​		2,534,071	​		28,778	​	4.56	​		2,389,919	​		27,938	​	4.74	​		2,152,398	​		25,943	​	4.85	​
Federal Home Loan Bank Stock	​		6,221	​	​	54	​	3.51	​		5,045	​	​	78	​	6.28	​		10,469	​	​	125	​	4.81	​
Total Interest Earning Assets	​		3,019,437	​		31,354	​	4.17	%		2,883,084	​		30,654	​	4.31	%		2,567,292	​		28,405	​	4.45	%
Noninterest Earning Assets	​	​	57,275	​	​	​	​	​	​	​	57,178	​	​	​	​	​	​	​	54,980	​	​	​	​	​	​
Total Assets	​	$	3,076,712	​	​	​	​	​	​	$	2,940,262	​	​	​	​	​	​	$	2,622,272	​	​	​	​	​	​
Interest Bearing Liabilities:	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Deposits:	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Interest Bearing Transaction Deposits	​	$	421,132	​	$	520	​	0.50	%	$	364,017	​	$	422	​	0.47	%	$	272,565	​	$	377	​	0.56	%
Savings and Money Market Deposits	​		764,632	​	​	940	​	0.49	​		724,104	​	​	1,008	​	0.56	​		521,313	​	​	1,327	​	1.02	​
Time Deposits	​		332,346	​	​	1,075	​	1.30	​		344,715	​	​	1,267	​	1.49	​		388,357	​	​	2,122	​	2.20	​
Brokered Deposits	​		379,768	​	​	978	​	1.03	​		402,694	​	​	974	​	0.98	​		319,711	​	​	1,344	​	1.69	​
Total Interest Bearing Deposits	​	​	1,897,878	​	​	3,513	​	0.74	​	​	1,835,530	​	​	3,671	​	0.81	​	​	1,501,946	​	​	5,170	​	1.38	​
Federal Funds Purchased	​		9,932	​	​	6	​	0.24	​		—	​	​	—	​	—	​		9	​		—	​	0.72	​
Notes Payable	​		—	​	​	—	​	—	​		6,722	​	​	61	​	3.66	​		12,000	​		111	​	3.72	​
FHLB Advances	​		57,500	​	​	228	​	1.59	​		57,500	​	​	228	​	1.61	​		193,819	​		1,064	​	2.21	​
Subordinated Debentures	​		73,862	​	​	1,112	​	6.04	​		73,776	​	​	1,085	​	5.96	​		31,228	​		479	​	6.17	​
Total Interest Bearing Liabilities	​		2,039,172	​		4,859	​	0.96	%		1,973,528	​		5,045	​	1.04	%		1,739,002	​		6,824	​	1.58	%
Noninterest Bearing Liabilities:	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Noninterest Bearing Transaction Deposits	​		732,299	​	​	​	​	​	​		676,173	​	​	​	​	​	​		603,456	​	​	​	​	​	​
Other Noninterest Bearing Liabilities	​	​	18,930	​	​	​	​	​	​	​	17,832	​	​	​	​	​	​	​	24,705	​	​	​	​	​	​
Total Noninterest Bearing Liabilities	​		751,229	​	​	​	​	​	​		694,005	​	​	​	​	​	​		628,161	​	​	​	​	​	​
Shareholders' Equity	​	​	286,311	​	​	​	​	​	​	​	272,729	​	​	​	​	​	​		255,109	​	​	​	​	​	​
Total Liabilities and Shareholders' Equity	​	$	3,076,712	​	​	​	​	​	​	$	2,940,262	​	​	​	​	​	​	$	2,622,272	​	​	​	​	​	​
Net Interest Income / Interest Rate Spread	​	​	​	​		26,495	​	3.21	%	​	​	​		25,609	​	3.27	%	​	​	​		21,581	​	2.87	%
Net Interest Margin ^(3)^	​	​	​	​	​	​	​	3.52	%	​	​	​	​	​	​	3.60	%	​	​	​	​	​	​	3.38	%
Taxable Equivalent Adjustment:	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Tax-Exempt Investment Securities and Loans	​	​	​	​		(207)	​	​	​	​	​	​		(214)	​	​	​	​	​	​		(239)	​	​	​
Net Interest Income	​	​	​	​	$	26,288	​	​	​	​	​	​	$	25,395	​	​	​	​	​	​	$	21,342	​	​	​

---

(1)	Interest income and average rates for tax-exempt investment securities and loans are presented on a tax-equivalent basis, assuming a statutory federal income tax rate of 21%.
(2)	Average loan balances include nonaccrual loans. Interest income on loans includes amortization of deferred loan fees, net of deferred loan costs.
---	---
(3)	Net interest margin includes the tax equivalent adjustment and represents the annualized results of: (i) the difference between interest income on interest earning assets and the interest expense on interest bearing liabilities, divided by (ii) average interest earning assets for the period.
---	---

​ Page 6 of 17

Provision for Loan Losses

​

The provision for loan losses was $1.6 million for the second quarter of 2021, an increase of $500,000 from $1.1 million for the first quarter of 2021, and a decrease of $1.4 million from $3.0 million for the second quarter of 2020. The provision recorded in the second quarter of 2021 was primarily attributable to growth of the loan portfolio. The allowance for loan losses to total loans was 1.45% at June 30, 2021, compared to 1.48% at March 31, 2021, and 1.26% at June 30, 2020. The allowance for loan losses to total loans, excluding PPP loans, was 1.50% at June 30, 2021, compared to 1.59% at March 31, 2021, and 1.37% at June 30, 2020.

​

As an emerging growth company, the Company is not subject to Accounting Standards Update No. 2016-13 “Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses of Financial Instruments,“ or CECL, until January 1, 2023.

​

The following table presents the activity in the Company’s allowance for loan losses for the periods indicated:

​

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	Three Months Ended								​	Six Months Ended
​	​	June 30,		​	March 31,		​	June 30,		​	June 30,		​	June 30,
(dollars in thousands)	****	2021		****	2021		****	2020		****	2021		****	2020
Balance at Beginning of Period	​	$	35,987	​	$	34,841	​	$	24,585	​	$	34,841	​	$	22,526
Provision for Loan Losses	​	​	1,600	​	​	1,100	​	​	3,000	​	​	2,700	​	​	5,100
Charge-offs	​	​	(3)	​	​	(14)	​	​	(1)	​	​	(17)	​	​	(48)
Recoveries	​	​	7	​	​	60	​	​	49	​	​	67	​	​	55
Balance at End of Period	​	$	37,591	​	$	35,987	​	$	27,633	​	$	37,591	​	$	27,633

​

Noninterest Income

​

Noninterest income was $1.6 million for the second quarter of 2021, an increase of $595,000 from $1.0 million for the first quarter of 2021, and a decrease of $374,000 from $2.0 million for the second quarter of 2020. The linked-quarter increase was primarily due to increased gains on sales of securities, offset partially by a decrease in letter of credit fees. The year-over-year decrease was primarily due to lower gains on sales of securities, offset partially by increased customer service fees and other income.

​

The following table presents the major components of noninterest income for the periods indicated:

​

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	Three Months Ended								​	Six Months Ended
​	​	June 30,		​	March 31,		​	June 30,		​	June 30,		​	June 30,
(dollars in thousands)	​	2021		****	2021		****	2020		****	2021		****	2020
Noninterest Income:	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Customer Service Fees	​	$	231	​	$	234	​	$	135	​	$	465	​	$	375
Net Gain on Sales of Securities	​	​	702	​	​	—	​	​	1,361	​	​	702	​	​	1,364
Letter of Credit Fees	​	​	231	​	​	327	​	​	265	​	​	558	​	​	539
Debit Card Interchange Fees	​	​	141	​	​	130	​	​	99	​	​	271	​	​	191
Swap Fees	​	​	—	​	​	—	​	​	—	​	​	—	​	​	907
Other Income	​	​	298	​	​	317	​	​	117	​	​	615	​	​	320
Totals	​	$	1,603	​	$	1,008	​	$	1,977	​	$	2,611	​	$	3,696

​

Noninterest Expense

​

Noninterest expense was $11.5 million for the second quarter of 2021, an increase of $554,000 from $10.9 million for the first quarter of 2021, and an increase of $766,000 from $10.7 million for the second quarter of 2020. The linked-quarter increase was primarily due to an increase in salaries and employee benefits and technology expenses. The year-over-year increase was primarily attributable to increased salaries and employee benefits, occupancy and equipment, technology, and marketing and advertising expenses, offset partially by a $1.4 million decrease in FHLB advance prepayment fees incurred in the second quarter of 2020, as well as lower amortization of tax credit investments.

​

​ Page 7 of 17

The following table presents the major components of noninterest expense for the periods indicated:

​

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	Three Months Ended								​	Six Months Ended
​	​	June 30,		​	March 31,		​	June 30,		​	June 30,		​	June 30,
(dollars in thousands)	​	2021		****	2021		****	2020		****	2021		****	2020
Noninterest Expense:	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Salaries and Employee Benefits	​	$	7,512	​	$	7,102	​	$	6,348	​	$	14,614	​	$	12,802
Occupancy and Equipment	​	​	980	​	​	1,055	​	​	672	​	​	2,035	​	​	1,385
FDIC Insurance Assessment	​	​	290	​	​	315	​	​	168	​	​	605	​	​	358
Data Processing	​	​	300	​	​	291	​	​	238	​	​	591	​	​	467
Professional and Consulting Fees	​	​	552	​	​	544	​	​	423	​	​	1,096	​	​	908
Information Technology and Telecommunications	​	​	549	​	​	462	​	​	326	​	​	1,011	​	​	592
Marketing and Advertising	​	​	314	​	​	286	​	​	85	​	​	600	​	​	551
Intangible Asset Amortization	​	​	47	​	​	48	​	​	47	​	​	95	​	​	95
Amortization of Tax Credit Investments	​	​	140	​	​	118	​	​	362	​	​	258	​	​	447
FHLB Advance Prepayment Fees	​	​	—	​	​	—	​	​	1,430	​	​	—	​	​	1,430
Other Expense	​	​	793	​	​	702	​	​	612	​	​	1,495	​	​	1,422
Totals	​	$	11,477	​	$	10,923	​	$	10,711	​	$	22,400	​	$	20,457

​

In the second quarter of 2021, the Company attracted 18 new hires in lending, deposit gathering, technology, risk management, and other supportive roles, which continued to demonstrate the Company’s status as a preferred employer amidst ongoing market disruption. The Company reached 214 full-time equivalent employees at June 30, 2021, compared to 200 employees at March 31, 2021, and 173 employees at June 30, 2020.

​

The efficiency ratio, a non-GAAP financial measure, was 42.0% for the second quarter of 2021, compared to 41.2% for the first quarter of 2021, and 48.6% for the second quarter of 2020. Excluding the impact of certain non-routine income and expenses, the adjusted efficiency ratio, a non-GAAP financial measure, was 41.5% for the second quarter of 2021, 40.7% for the first quarter of 2021 and 40.4% for the second quarter of 2020. The efficiencies of the Company’s “branch-light” model have positioned the Company well for when the pandemic ends, and going forward, providing more flexibility for the Company to make significant investments in technology as the industry adapts to evolving client behavior.

​

Income Taxes

​

The effective combined federal and state income tax rate for the first and second quarters of 2021 was 25.8%, an increase from 20.9% for the second quarter of 2020.

​

Balance Sheet

​

Total assets at June 30, 2021 were $3.16 billion, a 2.9% increase from $3.07 billion at March 31, 2021, and a 14.8% increase from $2.75 billion at June 30, 2020. The linked-quarter increase in total assets was primarily due to robust organic loan growth, offset partially by a corresponding decrease in cash and cash equivalents. The year-over-year increase in total assets was primarily due to robust organic loan growth, as well as deploying excess liquidity into investment securities.

​

Total gross loans at June 30, 2021 were $2.59 billion, an increase of $168.1 million, or 6.9%, over total gross loans of $2.43 billion at March 31, 2021, and an increase of $400.4 million, or 18.3%, over total gross loans of $2.19 billion at June 30, 2020. The increase in the loan portfolio during the second quarter of 2021 was primarily due to growth in the multifamily and construction and land development segments, offset partially by declining PPP loan balances. When excluding the PPP loans altogether, gross loans grew $232.2 million during the second quarter of 2021, or 41.2% on an annualized basis. The Company's continued strong loan growth has been driven by M&A-related market disruption in the Twin Cities resulting in client and banker acquisition opportunities, PPP-related client acquisition opportunities, the expansion of the talented lending teams, and the strong and growing brand in the Twin Cities market.

​

​ Page 8 of 17

The following table presents the dollar composition of the Company’s loan portfolio, by category, at the dates indicated:

​

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	June 30, 2021		​	March 31, 2021		​	December 31, 2020		​	September 30, 2020		​	June 30, 2020		​
(dollars in thousands)	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Commercial	​	$	321,474	​	$	301,023	​	$	304,220	​	$	287,254	​	$	302,536	​
Paycheck Protection Program	​	​	99,072	​	​	163,258	​	​	138,454	​	​	181,596	​	​	180,228	​
Construction and Land Development	​	​	251,573	​	​	193,372	​	​	170,217	​	​	175,882	​	​	191,768	​
Real Estate Mortgage:	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
1 - 4 Family Mortgage	​	​	277,943	​	​	294,964	​	​	294,479	​	​	286,089	​	​	289,456	​
Multifamily	​	​	790,275	​	​	665,415	​	​	626,465	​	​	585,814	​	​	522,491	​
CRE Owner Occupied	​	​	87,507	​	​	79,665	​	​	75,604	​	​	75,963	​	​	73,539	​
CRE Nonowner Occupied	​	​	758,101	​	​	720,396	​	​	709,300	​	​	660,058	​	​	627,651	​
Total Real Estate Mortgage Loans	​		1,913,826	​		1,760,440	​		1,705,848	​		1,607,924	​		1,513,137	​
Consumer and Other	​	​	8,241	​	​	8,030	​	​	7,689	​	​	6,572	​	​	6,109	​
Total Loans, Gross	​		2,594,186	​		2,426,123	​		2,326,428	​		2,259,228	​		2,193,778	​
Allowance for Loan Losses	​	​	(37,591)	​	​	(35,987)	​	​	(34,841)	​	​	(31,381)	​	​	(27,633)	​
Net Deferred Loan Fees	​	​	(11,450)	​	​	(11,273)	​	​	(9,151)	​	​	(10,367)	​	​	(10,287)	​
Total Loans, Net	​	$	2,545,145	​	$	2,378,863	​	$	2,282,436	​	$	2,217,480	​	$	2,155,858	​

​

Total deposits at June 30, 2021 were $2.72 billion, an increase of $82.3 million, or 3.1%, over total deposits of $2.64 billion at March 31, 2021, and an increase of $478.9 million, or 21.4%, over total deposits of $2.24 billion at June 30, 2020. Deposit growth in the second quarter of 2021 was primarily due to an increase in noninterest bearing transaction deposits and brokered deposits, offset partially by a decline in savings and money market deposits and time deposits. Similar to the loan portfolio, the growth in core deposits has been a result of successful new client and banker acquisition initiatives and the strong, growing brand in the Twin Cities market. Brokered deposits increased back to levels last seen in the fourth quarter of 2020 due to the opportunity to obtain $75.0 million in funding at 1 basis point at various short-term maturities ranging from 3-12 months. As illustrated, the brokered deposit market provides flexibility in structure, optionality and efficiency not provided in traditional, retail deposit channels. Given the fluid environment, management believes deposits could experience fluctuations in future periods.

​

The following table presents the dollar composition of the Company’s deposit portfolio, by category, at the dates indicated:

​

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	June 30, 2021		​	March 31, 2021		​	December 31, 2020		​	September 30, 2020		​	June 30, 2020		​
(dollars in thousands)	****	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Noninterest Bearing Transaction Deposits	​	$	758,023	​	$	712,999	​	$	671,903	​	$	685,773	​	$	648,869	​
Interest Bearing Transaction Deposits	​	​	432,123	​	​	433,344	​	​	366,290	​	​	322,253	​	​	285,386	​
Savings and Money Market Deposits	​	​	761,485	​	​	791,583	​	​	657,617	​	​	498,397	​	​	516,543	​
Time Deposits	​	​	321,857	​	​	344,581	​	​	353,543	​	​	363,897	​	​	382,187	​
Brokered Deposits	​	​	447,418	​	​	356,147	​	​	452,283	​	​	402,724	​	​	409,066	​
Total Deposits	​	$	2,720,906	​	$	2,638,654	​	$	2,501,636	​	$	2,273,044	​	$	2,242,051	​

​

Total shareholders’ equity at June 30, 2021 was $290.8 million, an increase of $11.7 million, or 4.2%, over total shareholders’ equity of $279.2 million at March 31, 2021, and an increase of $33.6 million, or 13.1%, over total shareholders’ equity of $257.2 million at June 30, 2020. The linked-quarter increase was due to net income retained. The year-over-year increase was due to net income retained and an increase in unrealized gains in the securities and derivatives portfolios, offset partially by stock repurchases made under the Company’s stock repurchase program. The Company did not repurchase any shares of its common stock during the second quarter of 2021.

​

Tangible book value per share, a non-GAAP financial measure, was $10.22 as of June 30, 2021, an increase of 4.3% from $9.80 as of March 31, 2021, and an increase of 16.2% from $8.80 as of June 30, 2020.

​

Subsequent to the end of the quarter, on July 8, 2021 the Company issued $30.0 million of 3.25% Fixed-to-Floating Rate Subordinated Notes due 2031 in a private placement transaction. These notes are callable starting on July 15, 2026 and qualify for tier 2 capital treatment at the holding company level. The Company intends to use the net proceeds of the private placement for general corporate purposes, including support for organic growth plans, support for bank level capital ratios and possible redemption or repurchase of currently outstanding indebtedness.

​

Asset Quality

​

Annualized net charge-offs (recoveries) as a percent of average loans for the second quarter of 2021 were 0.00%, compared to (0.01)% for the first quarter of 2021, and (0.01)% for the second quarter of 2020. At June 30, 2021, the Company’s nonperforming assets, which include nonaccrual loans, loans past due 90 days and still accruing, and foreclosed assets, were $761,000, or 0.02% of total assets, as compared to $770,000, or 0.03% of total assets at March 31, 2021, and $602,000 or 0.02% of total assets at June 30, 2020. Page 9 of 17

​

The Company has increased oversight and analysis of all segments of the loan portfolio in response to the COVID-19 pandemic, especially in vulnerable industries such as hospitality and restaurants, to proactively monitor evolving credit risk. Loans that have potential weaknesses that warrant a watchlist risk rating at June 30, 2021 totaled $56.7 million, compared to $58.3 million at March 31, 2021. As the COVID-19 pandemic continues to evolve, the length and extent of the economic uncertainty may result in further watchlist or adverse classifications in the loan portfolio. Loans that warranted a substandard risk rating at June 30, 2021 totaled $7.2 million, compared to $6.7 million at March 31, 2021.

​

The following table presents a summary of asset quality measurements at the dates indicated:

​

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	As of and for the Three Months Ended														​
​	​	June 30,		​	March 31		​	December 31,		​	September 30,			June 30,
(dollars in thousands)	****	2021		****	2021		****	2020		****	2020		****	2020		****
Selected Asset Quality Data		​	​		​	​		​	​	​	​	​	​	​	​	​
Loans 30-89 Days Past Due	​	$	—		$	—		$	13		$	458		$	153
Loans 30-89 Days Past Due to Total Loans	​	​	0.00	%	​	0.00	%	​	0.00	%	​	0.02	%	​	0.01	%
Nonperforming Loans	​	$	761		$	770		$	775		$	433		$	602
Nonperforming Loans to Total Loans	​	​	0.03	%	​	0.03	%	​	0.03	%	​	0.02	%	​	0.03	%
Foreclosed Assets	​	$	—		$	—		$	—		$	—		$	—
Nonaccrual Loans to Total Loans	​	​	0.03	%	​	0.03	%	​	0.03	%	​	0.02	%	​	0.03	%
Nonaccrual Loans and Loans Past Due 90 Days and Still Accruing to Total Loans	​	​	0.03	​	​	0.03	​	​	0.03	​	​	0.02	​	​	0.03	​
Nonperforming Assets ^(1)^	​	$	761		$	770		$	775		$	433		$	602
Nonperforming Assets to Total Assets ^(1)^	​	​	0.02	%	​	0.03	%	​	0.03	%	​	0.02	%	​	0.02	%
Allowance for Loan Losses to Total Loans	​	​	1.45		​	1.48		​	1.50		​	1.39		​	1.26
Allowance for Loan Losses to Total Loans, Excluding PPP Loans	​	​	1.51	​	​	1.59	​	​	1.59	​	​	1.51	​	​	1.37	​
Allowance for Loans Losses to Nonperforming Loans	​	​	4,939.68		​	4,673.64		​	4,495.61		​	7,247.34		​	4,590.20
Net Loan Charge-Offs (Recoveries) (Annualized) to Average Loans	​	​	0.00		​	(0.01)		​	0.08		​	0.00		​	(0.01)

---

(1)	Nonperforming assets are defined as nonaccrual loans plus loans 90 days past due plus foreclosed assets.

​

The Company developed programs for clients who experienced business and personal disruptions due to the COVID-19 pandemic by providing interest-only modifications, loan payment deferrals, and extended amortization modifications. In accordance with interagency regulatory guidance and the CARES Act, qualifying loans modified in response to the COVID-19 pandemic are not considered troubled debt restructurings. The Company had 19 modified loans totaling $33.9 million outstanding as of June 30, 2021, representing 1.4% of the total loan portfolio, excluding PPP loans.

​

​

The following table presents a rollforward of loan modification activity, by modification type, from March 31, 2021 to June 30, 2021:

​

​	​	​	​	​	​	​	​	​	​	​	​	​
(dollars in thousands)	​	Interest-Only		​	Payment Deferral		​	Extended Amortization		​	Total
Principal Balance - March 31, 2021	​	$	31,663	​	$	618	​	$	4,802	​	$	37,083
Modification Expired	​	​	(4,139)	​	​	(618)	​	​	—	​	​	(4,757)
Additional Modification Granted	​	​	1,173	​	​	—	​	​	—	​	​	1,173
New Modifications	​	​	468	​	​	—	​	​	—	​	​	468
Net Principal Advances (Payments)	​	​	(6)	​	​	—	​	​	(24)	​	​	(30)
Principal Balance - June 30, 2021	​	$	29,159	​	$	—	​	$	4,778	​	$	33,937

​

About the Company

​

Bridgewater Bancshares, Inc. (Nasdaq: BWB) is a St. Louis Park, Minnesota-based financial holding company. Bridgewater's banking subsidiary, Bridgewater Bank, is a premier, full-service Twin Cities bank dedicated to serving the diverse needs of commercial real estate investors, entrepreneurs, business clients and high-net-worth individuals. By pairing a range of deposit, lending and business services solutions with a responsive service model, Bridgewater has seen continuous growth and profitability. With total assets of $3.2 billion and seven branches as of June 30, 2021, Bridgewater is considered one of the largest locally led banks in the State of Minnesota, and has received numerous awards for its growth, banking services and esteemed corporate culture.

​

Investor Relations Contact:

​

Justin Horstman

Director of Investor Relations

investorrelations@bwbmn.com

952-542-5169

​ Page 10 of 17

Use of Non-GAAP financial measures

​

In addition to the results presented in accordance with U.S. Generally Accepted Accounting Principles (GAAP), the Company routinely supplements its evaluation with an analysis of certain non-GAAP financial measures. The Company believes these non-GAAP financial measures, in addition to the related GAAP measures, provide meaningful information to investors to help them understand the Company’s operating performance and trends, and to facilitate comparisons with the performance of peers. These disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies. Reconciliations of non-GAAP disclosures used in this earnings release to the comparable GAAP measures are provided in the accompanying tables.

​

Forward-Looking Statements

​

This earnings release contains “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements include, without limitation, statements concerning plans, estimates, calculations, forecasts and projections with respect to the anticipated future performance of the Company. These statements are often, but not always, identified by words such as “may”, “might”, “should”, “could”, “predict”, “potential”, “believe”, “expect”, “continue”, “will”, “anticipate”, “seek”, “estimate”, “intend”, “plan”, “projection”, “would”, “annualized”, “target” and “outlook”, or the negative version of those words or other comparable words of a future or forward-looking nature.

​

Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on our current beliefs, expectations and assumptions regarding our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Our actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not rely on any of these forward-looking statements. Important factors that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, among others, the following: the negative effects of the COVID-19 pandemic, including its effects on the economic environment, our clients and our operations, as well as any changes to federal, state or local government laws, regulations or orders in connection with the pandemic; loan concentrations in our portfolio; the overall health of the local and national real estate market; our ability to successfully manage credit risk; business and economic conditions generally and in the financial services industry, nationally and within our market area; our ability to maintain an adequate level of allowance for loan losses; new or revised accounting standards, including as a result of the future implementation of the Current Expected Credit Loss standard; the concentration of large loans to certain borrowers; the concentration of large deposits from certain clients; our ability to successfully manage liquidity risk; our dependence on non-core funding sources and our cost of funds; our ability to raise additional capital to implement our business plan; our ability to implement our growth strategy and manage costs effectively; developments and uncertainty related to the future use and availability of some reference rates, such as the London Interbank Offered Rate, as well as other alternative reference rates; the composition of our senior leadership team and our ability to attract and retain key personnel; the occurrence of fraudulent activity, breaches or failures of our information security controls or cybersecurity-related incidents; interruptions involving our information technology and telecommunications systems or third-party servicers; competition in the financial services industry; the effectiveness of our risk management framework; the commencement and outcome of litigation and other legal proceedings and regulatory actions against us; the impact of recent and future legislative and regulatory changes; interest rate risk; fluctuations in the values of the securities held in our securities portfolio; the imposition of tariffs or other governmental policies impacting the value of products produced by our commercial borrowers; severe weather, natural disasters, wide spread disease or pandemics (including the COVID-19 pandemic), acts of war or terrorism or other adverse external events; potential impairment to the goodwill we recorded in connection with our past acquisition; changes to U.S. tax laws, regulations and guidance; and any other risks described in the “Risk Factors” sections of reports filed by the Company with the Securities and Exchange Commission.

​

Any forward-looking statement made by us in this press release is based only on information currently available to us and speaks only as of the date on which it is made. We undertake no obligation to publicly update any forward-looking statement, whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise.

​ Page 11 of 17

Bridgewater Bancshares, Inc. and Subsidiaries Consolidated Balance Sheets

(dollars in thousands, except share data)

​

​	​	​	​	​	​	​	​	​	​
​	​	June 30,		​	December 31,		​	June 30,
​	****	2021		****	2020		****	2020
​	​	(Unaudited)		​	​	​	​	(Unaudited)
ASSETS	​	​	​	​	​	​	​	​	​
Cash and Cash Equivalents	​	$	92,197	​	$	160,675	​	$	178,428
Bank-Owned Certificates of Deposit	​		2,368	​		2,860	​		2,895
Securities Available for Sale, at Fair Value	​		402,786	​		390,629	​		326,295
Loans, Net of Allowance for Loan Losses of $37,591 at June 30, 2021 (unaudited), $34,841 at December 31, 2020 and $27,633 at June 30, 2020 (unaudited)	​	​	2,545,145	​		2,282,436	​		2,155,858
Federal Home Loan Bank (FHLB) Stock, at Cost	​		5,832	​		5,027	​		8,617
Premises and Equipment, Net	​		50,177	​		50,987	​		43,062
Accrued Interest	​		8,728	​		9,172	​		8,267
Goodwill	​		2,626	​		2,626	​		2,626
Other Intangible Assets, Net	​		574	​		670	​		765
Other Assets	​		52,179	​		22,263	​		27,650
Total Assets	​	$	3,162,612	​	$	2,927,345	​	$	2,754,463
​	​	​	​	​	​	​	​	​	​
LIABILITIES AND EQUITY	​			​			​
LIABILITIES	​			​			​
Deposits:	​			​			​
Noninterest Bearing	​	$	758,023	​	$	671,903	​	$	648,869
Interest Bearing	​		1,962,883	​		1,829,733	​		1,593,182
Total Deposits	​		2,720,906	​		2,501,636	​		2,242,051
Notes Payable	​		—	​		11,000	​		12,000
FHLB Advances	​		57,500	​		57,500	​		147,500
Subordinated Debentures, Net of Issuance Costs	​		73,913	​		73,739	​		73,658
Accrued Interest Payable	​		2,654	​		1,615	​		1,953
Other Liabilities	​		16,809	​		16,450	​		20,111
Total Liabilities	​		2,871,782	​		2,661,940	​		2,497,273
​	​	​	​	​	​	​	​	​	​
SHAREHOLDERS' EQUITY	​			​			​
Preferred Stock- $0.01 par value	​	​	​	​	​	​	​	​	​
Authorized 10,000,000; None Issued and Outstanding at June 30, 2021 (unaudited), December 31, 2020 and June 30, 2020 (unaudited)	​	​	—	​		—	​		—
Common Stock- $0.01 par value	​		​	​			​		​
Common Stock - Authorized 75,000,000; Issued and Outstanding 28,162,777 at June 30, 2021 (unaudited), 28,143,493 at December 31, 2020 and 28,837,560 at June 30, 2020 (unaudited)	​	​	282	​		281	​		288
Additional Paid-In Capital	​		104,811	​		103,714	​		110,906
Retained Earnings	​		176,495	​		154,831	​		142,678
Accumulated Other Comprehensive Income	​		9,242	​		6,579	​		3,318
Total Shareholders' Equity	​		290,830	​		265,405	​		257,190
Total Liabilities and Equity	​	$	3,162,612	​	$	2,927,345	​	$	2,754,463

​

​ Page 12 of 17

Bridgewater Bancshares, Inc. and SubsidiariesConsolidated Statements of Income

(dollars in thousands, except per share data)

​

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	Three Months Ended								​	Six Months Ended
​	​	June 30,		​	March 31,		​	June 30,		​	June 30,		​	June 30,
​	****	2021		****	2021		****	2020		****	2021		****	2020
​	​	(Unaudited)		​	(Unaudited)		​	(Unaudited)		​	(Unaudited)		​	(Unaudited)
INTEREST INCOME		​			​	​		​			​			​
Loans, Including Fees	​	$	28,748	​	$	27,908	​	$	25,913	​	$	56,656	​	$	51,026
Investment Securities	​		2,312	​		2,420	​		2,091	​		4,732	​		4,287
Other	​		87	​		112	​		162	​		199	​		321
Total Interest Income	​		31,147	​		30,440	​		28,166	​		61,587	​		55,634
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
INTEREST EXPENSE	​		​	​		​	​		​	​		​	​		​
Deposits	​		3,513	​		3,671	​		5,170	​		7,184	​	​	10,894
Notes Payable	​		—	​		61	​		111	​		61	​	​	226
FHLB Advances	​		228	​		228	​		1,064	​		456	​	​	2,091
Subordinated Debentures	​		1,112	​		1,085	​		479	​		2,197	​	​	872
Federal Funds Purchased	​		6	​		—	​		—	​		6	​	​	107
Total Interest Expense	​		4,859	​		5,045	​		6,824	​		9,904	​		14,190
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
NET INTEREST INCOME	​		26,288	​		25,395	​		21,342	​		51,683	​		41,444
Provision for Loan Losses	​		1,600	​		1,100	​		3,000	​		2,700	​	​	5,100
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
NET INTEREST INCOME AFTER	​			​			​			​			​
PROVISION FOR LOAN LOSSES	​		24,688	​		24,295	​		18,342	​		48,983	​		36,344
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
NONINTEREST INCOME	​			​			​			​			​
Customer Service Fees	​		231	​		234	​	​	135	​		465	​	​	375
Net Gain on Sales of Available for Sale Securities	​		702	​		—	​	​	1,361	​		702	​	​	1,364
Other Income	​		670	​		774	​	​	481	​		1,444	​	​	1,957
Total Noninterest Income	​		1,603	​		1,008	​		1,977	​		2,611	​		3,696
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
NONINTEREST EXPENSE	​			​			​			​			​
Salaries and Employee Benefits	​		7,512	​		7,102	​	​	6,348	​		14,614	​	​	12,802
Occupancy and Equipment	​		980	​		1,055	​	​	672	​		2,035	​	​	1,385
Other Expense	​		2,985	​		2,766	​	​	3,691	​		5,751	​	​	6,270
Total Noninterest Expense	​		11,477	​		10,923	​		10,711	​		22,400	​		20,457
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
INCOME BEFORE INCOME TAXES	​		14,814	​		14,380	​		9,608	​		29,194	​	​	19,583
Provision for Income Taxes	​		3,821	​		3,709	​	​	2,010	​		7,530	​	​	4,542
NET INCOME	​	$	10,993	​	$	10,671	​	$	7,598	​	$	21,664	​	$	15,041
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
EARNINGS PER SHARE	​			​	​	​	​			​		​	​		​
Basic	​	$	0.39	​	$	0.38	​	$	0.26	​	$	0.77	​	$	0.52
Diluted	​	​	0.38	​	​	0.37	​	​	0.26	​	​	0.75	​	​	0.51
Dividends Paid Per Share	​	​	—	​	​	—	​	​	—	​	​	—	​	​	—

​

​

​ Page 13 of 17

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Bridgewater Bancshares, Inc. and SubsidiariesAnalysis of Average Balances, Yields and Rates (year-to-date)<br><br>(dollars in thousands, except per share data) (Unaudited)<br><br>​	​	For the Six Months Ended															****
​	​	June 30, 2021							​	June 30, 2020							****
​	​	Average		​	Interest		​	Yield/	​	Average		​	Interest		​	Yield/	​
​	****	Balance		****	& Fees		****	Rate	****	Balance		****	& Fees		****	Rate	****
(dollars in thousands)	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Interest Earning Assets:	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Cash Investments	​	$	96,724	​	$	67	​	0.14	%	$	69,267	​	$	96	​	0.28	%
Investment Securities:	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Taxable Investment Securities	​		307,898	​		3,371	​	2.21	​		195,873	​		2,691	​	2.76	​
Tax-Exempt Investment Securities^(1)^	​		78,985	​		1,723	​	4.40	​		93,260	​		2,020	​	4.36	​
Total Investment Securities	​		386,883	​		5,094	​	2.66	​		289,133	​		4,711	​	3.28	​
Paycheck Protection Program Loans ^(2)^	​		149,098	​	​	3,631	​	4.91	​		70,037	​		873	​	2.51	​
Loans ^(1)(2)^	​	​	2,313,295	​	​	53,085	​	4.63	​	​	1,983,641	​	​	50,220	​	5.09	​
Total Loans	​		2,462,393	​		56,716	​	4.64	​		2,053,678	​		51,093	​	5.00	​
Federal Home Loan Bank Stock	​		5,636	​	​	132	​	4.74	​		10,370	​		225	​	4.37	​
Total Interest Earning Assets	​		2,951,636	​		62,009	​	4.24	%		2,422,448	​		56,125	​	4.66	%
Noninterest Earning Assets	​	​	57,228	​	​	​	​	​	​	​	47,208	​	​	​	​	​	​
Total Assets	​	$	3,008,864	​	​	​	​	​	​	$	2,469,656	​	​	​	​	​	​
Interest Bearing Liabilities:	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Deposits:	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Interest Bearing Transaction Deposits	​	$	392,732	​	$	942	​	0.48	%	$	259,704	​	$	808	​	0.63	%
Savings and Money Market Deposits	​		744,480	​	​	1,949	​	0.53	​		527,445	​		3,232	​	1.23	​
Time Deposits	​		338,497	​	​	2,341	​	1.39	​		382,256	​		4,299	​	2.26	​
Brokered Deposits	​		391,167	​	​	1,952	​	1.01	​		269,000	​		2,555	​	1.91	​
Total Interest Bearing Deposits	​		1,866,876	​		7,184	​	0.78	​		1,438,405	​		10,894	​	1.52	​
Federal Funds Purchased	​		4,993	​	​	6	​	0.24	​		12,422	​		107	​	1.74	​
Notes Payable	​		3,343	​	​	61	​	3.66	​		12,253	​		226	​	3.71	​
FHLB Advances	​		57,500	​	​	456	​	1.60	​		183,099	​		2,091	​	2.30	​
Subordinated Debentures	​		73,819	​	​	2,197	​	6.00	​		27,986	​		872	​	6.27	​
Total Interest Bearing Liabilities	​		2,006,531	​		9,904	​	1.00	%		1,674,165	​		14,190	​	1.70	%
Noninterest Bearing Liabilities:	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Noninterest Bearing Transaction Deposits	​		704,391	​	​	​	​	​	​		523,828	​	​	​	​	​	​
Other Noninterest Bearing Liabilities	​	​	18,384	​	​	​	​	​	​	​	18,708	​	​	​	​	​	​
Total Noninterest Bearing Liabilities	​		722,775	​	​	​	​	​	​		542,536	​	​	​	​	​	​
Shareholders' Equity	​	​	279,558	​	​	​	​	​	​		252,955	​	​	​	​	​	​
Total Liabilities and Shareholders' Equity	​	$	3,008,864	​	​	​	​	​	​	$	2,469,656	​	​	​	​	​	​
Net Interest Income / Interest Rate Spread	​	​	​	​		52,105	​	3.24	%	​	​	​		41,935	​	2.96	%
Net Interest Margin ^(3)^	​	​	​	​	​	​	​	3.56	%	​	​	​	​	​	​	3.48	%
Taxable Equivalent Adjustment:	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Tax-Exempt Investment Securities and Loans	​	​	​	​		(422)	​	​	​	​	​	​		(491)	​	​	​
Net Interest Income	​	​	​	​	$	51,683	​	​	​	​	​	​	$	41,444	​	​	​

---

(1)	Interest income and average rates for tax-exempt investment securities and loans are presented on a tax-equivalent basis, assuming a statutory federal income tax rate of 21%
(2)	Average loan balances include nonaccrual loans. Interest income on loans includes amortization of deferred loan fees, net of deferred loan costs.
---	---
(3)	Net interest margin includes the tax equivalent adjustment and represents the annualized results of: (i) the difference between interest income on interest earning assets and the interest expense on interest bearing liabilities, divided by (ii) average interest earning assets for the period.
---	---

​ Page 14 of 17

Non-GAAP Financial Measures

(dollars in thousands) (unaudited)

​

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	For the Three Months Ended								​	For the Six Months Ended					​
​	​	June 30,		​	March 31,		​	June 30,		​	June 30,		​	June 30,		​
​	****	2021		****	2021		​	2020		​	2021		****	2020		****
Pre-Provision Net Revenue	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Noninterest Income		$	1,603	​	$	1,008	​	$	1,977	​	$	2,611	​	$	3,696	​
Less: Gain on sales of Securities	​	​	(702)	​	​	—	​	​	(1,361)	​	​	(702)	​	​	(1,364)	​
Total Operating Noninterest Income	​	​	901	​	​	1,008	​	​	616	​	​	1,909	​	​	2,332	​
Plus: Net Interest income	​	​	26,288	​	​	25,395	​	​	21,342	​	​	51,683	​	​	41,444	​
Net Operating Revenue	​	$	27,189	​	$	26,403	​	$	21,958	​	$	53,592	​	$	43,776	​
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Noninterest Expense	​	$	11,477	​	$	10,923	​	$	10,711	​	$	22,400	​	$	20,457	​
Less: Amortization of Tax Credit Investments	​	​	(140)	​	​	(118)	​	​	(362)	​	​	(258)	​	​	(447)	​
Less: FHLB Advance Prepayment Fees	​	​	—	​	​	—	​	​	(1,430)	​	​	—	​	​	(1,430)	​
Total Operating Noninterest Expense	​	$	11,337	​	$	10,805	​	$	8,919	​	$	22,142	​	$	18,580	​
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Pre-Provision Net Revenue	​	$	15,852	​	$	15,598	​	$	13,039	​	$	31,450	​	$	25,196	​
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Plus:	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Non-Operating Revenue Adjustments	​	​	702	​	​	—	​	​	1,361	​	​	702	​	​	1,364	​
Less:	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Provision for Loan Losses	​	​	1,600	​	​	1,100	​	​	3,000	​	​	2,700	​	​	5,100	​
Non-Operating Expense Adjustments	​	​	140	​	​	118	​	​	1,792	​	​	258	​	​	1,877	​
Provision for Income Taxes	​	​	3,821	​	​	3,709	​	​	2,010	​	​	7,530	​	​	4,542	​
Net Income	​	$	10,993	​	$	10,671	​	$	7,598	​	$	21,664	​	$	15,041	​
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Average Assets	​	$	3,076,712	​	$	2,940,262	​	$	2,622,272	​	$	3,008,864	​	$	2,469,656	​
Pre-Provision Net Revenue Return on Average Assets	​	​	2.07	%	​	2.15	%	​	2.00	%	​	2.11	%	​	2.05	%

​

​

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	As of and for the Three Months Ended								​	​	As of and for the Six Months Ended					​
​	​	June 30,		​	March 31		​	June 30,		​	​	June 30,		​	June 30,		​
​	****	2021		****	2021		****	2020		****	****	2021		****	2020		****
Core Net Interest Margin	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Net Interest Income (Tax-Equivalent Basis)		$	26,495	​	$	25,609	​	$	21,581	​		$	52,105	​	$	41,935	​
Less: Loan Fees	​	​	(1,023)	​	​	(1,202)	​	​	(1,264)	​	​	​	(2,225)	​	​	(2,571)	​
Less: PPP Interest and Fees	​	​	(1,767)	​	​	(1,864)	​	​	(873)	​	​	​	(3,631)	​	​	(873)	​
Core Net Interest Income	​	$	23,705	​	$	22,543	​	$	19,444	​	​	$	46,249	​	$	38,491	​
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Average Interest Earning Assets	​	​	3,019,437	​	​	2,883,084	​	​	2,567,292	​	​	​	2,951,636	​	​	2,422,448	​
Less: Average PPP Loans	​	​	(149,312)	​	​	(148,881)	​	​	(139,235)	​	​	​	(149,098)	​	​	(70,037)	​
Core Average Interest Earning Assets	​	$	2,870,125	​	$	2,734,203	​	$	2,428,057	​	​	$	2,802,538	​	$	2,352,411	​
Core Net Interest Margin	​	​	3.31	%		3.34	%		3.22	%	​		3.33	%		3.29	%

Page 15 of 17

Non-GAAP Financial Measures

(dollars in thousands) (unaudited)

​

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​

Page 16 of 17

​	​	For the Three Months Ended								​	​	For the Six Months Ended					​
​	​	June 30,		​	March 31,		​	June 30,		​	​	June 30,		​	June 30,		​
​	****	2021		****	2021		****	2020		****	****	2021		****	2020		****
Efficiency Ratio	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Noninterest Expense		$	11,477	​	$	10,923	​	$	10,711	​		$	22,400	​	$	20,457	​
Less: Amortization of Intangible Assets	​	​	(47)	​	​	(48)	​	​	(47)	​	​	​	(95)	​	​	(95)	​
Adjusted Noninterest Expense	​	$	11,430	​	$	10,875	​	$	10,664	​	​	$	22,305	​	$	20,362	​
Net Interest Income	​	​	26,288	​	​	25,395	​	​	21,342	​	​	​	51,683	​	​	41,444	​
Noninterest Income	​	​	1,603	​	​	1,008	​	​	1,977	​	​	​	2,611	​	​	3,696	​
Less: Gain on Sales of Securities	​	​	(702)	​	​	—	​	​	(1,361)	​	​	​	(702)	​	​	(1,364)	​
Adjusted Operating Revenue	​	$	27,189	​	$	26,403	​	$	21,958	​	​	$	53,592	​	$	43,776	​
Efficiency Ratio	​		42.0	%		41.2	%		48.6	%	​		41.6	%		46.5	%
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Adjusted Efficiency Ratio	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Noninterest Expense	​	$	11,477	​	$	10,923	​	$	10,711	​	​	$	22,400	​	$	20,457	​
Less: Amortization of Tax Credit Investments	​	​	(140)	​	​	(118)	​	​	(362)	​	​	​	(258)	​	​	(447)	​
Less: FHLB Advance Prepayment Fees	​	​	—	​	​	—	​	​	(1,430)	​	​	​	—	​	​	(1,430)	​
Less: Amortization of Intangible Assets	​	​	(47)	​	​	(48)	​	​	(47)	​	​	​	(95)	​	​	(95)	​
Adjusted Noninterest Expense	​	$	11,290	​	$	10,757	​	$	8,872	​	​	$	22,047	​	$	18,485	​
Net Interest Income	​	​	26,288	​	​	25,395	​	​	21,342	​	​	​	51,683	​	​	41,444	​
Noninterest Income	​	​	1,603	​	​	1,008	​	​	1,977	​	​	​	2,611	​	​	3,696	​
Less: Gain on Sales of Securities	​	​	(702)	​	​	—	​	​	(1,361)	​	​	​	(702)	​	​	(1,364)	​
Adjusted Operating Revenue	​	$	27,189	​	$	26,403	​	$	21,958	​	​	$	53,592	​	$	43,776	​
Adjusted Efficiency Ratio	​		41.5	%		40.7	%		40.4	%	​		41.1	%		42.2	%

​

​

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	For the Three Months Ended								​	​	For the Six Months Ended					​
​	​	June 30,		​	March 31		​	June 30,		​	​	June 30,		​	June 30,		​
​	****	2021		****	2021		****	2020		****	****	2021		****	2020		****
Adjusted Noninterest Expense to Average Assets	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Noninterest Expense		$	11,477	​	$	10,923	​	$	10,711	​		$	22,400	​	$	20,457	​
Less: Amortization of Tax Credit Investments	​	​	(140)	​	​	(118)	​	​	(362)	​	​	​	(258)	​	​	(447)	​
Less: FHLB Advance Prepayment Fees	​	​	—	​	​	—	​	​	(1,430)	​	​	​	—	​	​	(1,430)	​
Adjusted Noninterest Expense	​	$	11,337	​	$	10,805	​	$	8,919	​	​	$	22,142	​	$	18,580	​
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Average Assets	​	$	3,076,712	​	$	2,940,262	​	$	2,622,272	​	​	$	3,008,864	​	$	2,469,656	​
Adjusted Noninterest Expense to Average Assets	​		1.48	%		1.49	%		1.37	%	​		1.48	%		1.51	%

​ Page 17 of 17

Non-GAAP Financial Measures

(dollars in thousands) (unaudited)

​

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	As of and for the Three Months Ended								​	​	As of and for the Six Months Ended					​
​	​	June 30,		​	March 31,		​	June 30,		​	​	June 30,		​	June 30,		​
​	​	2021		​	2021		​	2020		​	​	2021		​	2020		​
Tangible Common Equity and Tangible Common Equity/Tangible Assets	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Common Equity	​	$	290,830	​	$	279,171	​	$	257,190	​	​	​	​	​	​	​	​
Less: Intangible Assets	​	​	(3,200)	​	​	(3,248)	​	​	(3,391)	​	​	​	​	​	​	​	​
Tangible Common Equity	​	$	287,630	​	$	275,923	​	$	253,799	​	​	​	​	​	​	​	​
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Total Assets	​	$	3,162,612	​	$	3,072,359	​	$	2,754,463	​	​	​	​	​	​	​	​
Less: Intangible Assets	​	​	(3,200)	​	​	(3,248)	​	​	(3,391)	​	​	​	​	​	​	​	​
Tangible Assets	​	$	3,159,412	​	$	3,069,111	​	$	2,751,072	​	​	​	​	​	​	​	​
Tangible Common Equity/Tangible Assets	​		9.10	%		8.99	%		9.23	%	​	​	​	​	​	​	​
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Tangible Book Value Per Share	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Book Value Per Common Share	​	$	10.33	​	$	9.92	​	$	8.92	​	​	​	​	​	​	​	​
Less: Effects of Intangible Assets	​	​	(0.11)	​	​	(0.12)	​	​	(0.12)	​	​	​	​	​	​	​	​
Tangible Book Value Per Common Share	​	$	10.22	​	$	9.80	​	$	8.80	​	​	​	​	​	​	​	​
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Return on Average Tangible Common Equity	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Net Income	​	$	10,993	​	$	10,671	​	$	7,598	​	​	$	21,664	​	$	15,041	​
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Average Common Equity	​	$	286,311	​	$	272,729	​	$	255,109	​	​	$	279,558	​	$	252,955	​
Less: Effects of Average Intangible Assets	​	​	(3,228)	​	​	(3,276)	​	​	(3,419)	​	​	​	(3,251)	​	​	(3,442)	​
Average Tangible Common Equity	​	$	283,083	​	$	269,453	​	$	251,690	​	​	$	276,307	​	$	249,513	​
Return on Average Tangible Common Equity	​		15.58	%		16.06	%		12.14	%	​		15.81	%		12.12	%

​

​

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	Three Months Ended
​	​	June 30,		​	March 31,		​	December 31,		​	September 30,		​	June 30,
​	​	2021		​	2021		​	2020		​	2020		​	2020
Tangible Common Equity	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Common Equity	​	$	290,830	​	$	279,171	​	$	265,405	​	$	265,432	​	$	257,190
Less: Intangible Assets	​	​	(3,200)	​	​	(3,248)	​	​	(3,296)	​	​	(3,344)	​	​	(3,391)
Tangible Common Equity	​	$	287,630	​	$	275,923	​	$	262,109	​	$	262,088	​	$	253,799

​ Page 18 of 17

Exhibit 99.2

Investor Presentation<br>Fourth Quarter 2019
2<br>Forward-Looking Statements<br>This presentation contains “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking<br>statements include, without limitation, statements concerning plans, estimates, calculations, forecasts and projections with respect to the anticipated future performance of Bridgewater<br>Bancshares, Inc. (the “Company”). These statements are often, but not always, identified by words such as “may”, “might”, “should”, “could”, “predict”, “potential”, “believe”, “expect”,<br>“continue”, “will”, “anticipate”, “seek”, “estimate”, “intend”, “plan”, “projection”, “would”, “annualized”, “target” and “outlook”, or the negative version of those words or other<br>comparable words of a future or forward-looking nature. Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on<br>our current beliefs, expectations and assumptions regarding our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions.<br>Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are<br>outside of our control. Our actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not rely on any of<br>these forward-looking statements. Important factors that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements<br>include, among others, the following: the negative effects of the COVID-19 pandemic, including its effects on the economic environment, our clients and our operations, as well as any<br>changes to federal, state or local government laws, regulations or orders in connection with the pandemic; loan concentrations in our portfolio; the overall health of the local and national<br>real estate market; our ability to successfully manage credit risk; business and economic conditions generally and in the financial services industry, nationally and within our market area;<br>our ability to maintain an adequate level of allowance for loan losses; new or revised accounting standards, including as a result of the future implementation of the Current Expected<br>Credit Loss Standard; our high concentration of large loans to certain borrowers; our concentration of large deposits from certain clients; our ability to successfully manage liquidity risk;<br>our dependence on non-core funding sources and our cost of funds; our ability to raise additional capital to implement our business plan; our ability to implement our growth strategy and<br>manage costs effectively; developments and uncertainty related to the future use and availability of some reference rates, such as the London Interbank Offered Rate, as well as other<br>alternative reference rates; the composition of our senior leadership team and our ability to attract and retain key personnel; the occurrence of fraudulent activity, breaches or failures of<br>our information security controls or cybersecurity-related incidents; interruptions involving our information technology and telecommunications systems or third-party servicers;<br>competition in the financial services industry; the effectiveness of our risk management framework; the commencement and outcome of litigation and other legal proceedings and<br>regulatory actions against us; the impact of recent and future legislative and regulatory changes; interest rate risk; fluctuations in the values of the securities held in our securities portfolio;<br>the imposition of tariffs or other governmental policies impacting the value of products produced by our commercial borrowers; severe weather, natural disasters, wide spread disease or<br>pandemics (including the COVID-19 pandemic), acts of war or terrorism or other adverse external events; potential impairment to the goodwill we recorded in connection with our past<br>acquisition; changes to U.S. tax laws, regulations and guidance; and any other risks described in the “Risk Factors” sections of reports and other documents filed by the Company with the<br>Securities and Exchange Commission.<br>Any forward-looking statement made by us in this presentation is based only on information currently available to us and speaks only as of the date on which it is made. We undertake no<br>obligation to publicly update any forward-looking statement, whether written or oral, that may be made from time to time, whether as a result of new information, future developments<br>or otherwise. Certain of the information contained in this presentation is derived from information provided by industry sources. Although we believe that such information is accurate<br>and that the sources from which it has been obtained are reliable, we cannot guarantee the accuracy of, and have not independently verified, such information.<br>Use of Non-GAAP financial measures<br>In addition to the results presented in accordance with U.S. General Accepted Accounting Principles (“GAAP”), the Company routinely supplements its evaluation with an analysis of certain<br>non-GAAP financial measures. The Company believes these non-GAAP financial measures, in addition to the related GAAP measures, provide meaningful information to investors to help<br>them understand the Company’s operating performance and trends, and to facilitate comparisons with the performance of peers. These disclosures should not be viewed as a substitute<br>for operating results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies.<br>Reconciliations of non-GAAP disclosures to the comparable GAAP measures are provided in this presentation.<br>Disclaimer
---
3<br>The Finest Entrepreneurial Bank<br>in the Twin Cities<br>Company Highlights<br>Company Overview Franchise Footprint<br>Name: Bridgewater Bancshares, Inc.<br>Headquarters: St. Louis Park, MN<br>Ticker: NASDAQ: BWB<br>Assets: $3.2 Billion<br>Loans: $2.6 Billion<br>Deposits: $2.7 Billion<br>Equity: $290.8 Million<br>• Founded in 2005 by a group of banking industry veterans and local business leaders<br>• Publicly traded on NASDAQ since March 14, 2018 under the symbol “BWB”<br>• The Company operates through seven branches across the Twin Cities MSA<br>• Continuous profitability since the third month of operations<br>• Record of stability, growth and profitability through the Great Recession and recovery, and, more recently, through the<br>COVID-19 pandemic<br>• Expertise in commercial real estate with a focus in multifamily lending<br>• Organizational focus on productivity and risk management<br>• Effective operating model, with an efficiency ratio consistently in the low 40% range<br>Twin Cities MSA<br>Data as of June 30, 2021
---
1 Represents a Non-GAAP financial measure. See Appendix for Non-GAAP reconciliation.<br>4<br>$0.38<br>• Gross loan balances up $168.1 million, or 27.8% annualized from 1Q21 (up 41.2% ex. PPP)<br>• Deposit balances up $82.3 million, or 12.5% annualized from 1Q21<br>Diluted<br>EPS<br>Efficiency<br>Ratio1<br>Return on Average<br>Common Equity<br>Return on<br>Average Assets<br>1.43% 15.40% 42.0%<br>• Total revenue of $27.9 million, up 5.6% from 1Q21<br>• Pre-provision net revenue1 (PPNR) of $15.9 million with a PPNR ROA1 of 2.07%<br>• Solid net interest margin of 3.52%, down 8 bps from 1Q21; core net interest margin1 (ex. PPP<br>and loan fees) of 3.31%, down 3 bps from 1Q21<br>• Annualized net charge-offs to average loans of 0.00%<br>• Provision of $1.6 million driven by continued strong loan growth, bringing allowance to total<br>loans to 1.50% (ex. PPP), down from 1.59% in 1Q21<br>• Nonperforming assets to total assets of 0.02%, down from 0.03% in 1Q21<br>• Tangible common equity ratio1 of 9.10%, up 11 bps from 1Q21<br>• $1.3 billion of on- and off-balance sheet liquidity<br>• Completed private placement of $30 million of 3.25% Fixed-to-Floating Rate Subordinated Notes<br>due 2031 on July 8, 2021<br>Robust Balance<br>Sheet Growth<br>Continues<br>Strong Revenue<br>Growth<br>Superb<br>Asset Quality<br>Solid Capital and<br>Liquidity Position<br>2Q21 Earnings Highlights
---
PPNR ROA1<br>5<br>Strong Profitability and Revenue Generation<br>Strong PPNR<br>1 Represents a Non-GAAP financial measure. See Appendix for Non-GAAP reconciliation<br>Dollars in thousands<br>Consistent Revenue Growth<br>$21,342 $21,679<br>$24,841 $25,395 $26,288<br>$1,977 $1,157<br>$986 $1,008<br>$1,603<br>$23,319 $22,836<br>$25,827 $26,403<br>$27,891<br>2Q20 3Q20 4Q20 1Q21 2Q21<br>$13,039 $13,200<br>$16,298 $15,598 $15,852<br>$7,598 $7,174<br>$4,979<br>$10,671 $10,993<br>2.00% 1.94%<br>2.30%<br>2.15% 2.07%<br>1.17%<br>1.05%<br>0.70%<br>1.47% 1.43%<br>2Q20 3Q20 4Q20 1Q21 2Q21<br>Net Income PPNR1 ROA Noninterest Income Net Interest Income
---
$21,342 $21,679<br>$24,841<br>$25,935 $26,288<br>3.38%<br>3.28%<br>3.61% 3.60% 3.52%<br>3.22% 3.14%<br>3.29% 3.34% 3.31%<br>2Q20 3Q20 4Q20 1Q21 2Q21<br>Core Net Interest Margin1,2 Net Interest Margin1<br>6<br>1 Amounts calculated on a tax-equivalent basis using statutory federal tax rate of 21%<br>2 Excludes loan fees and PPP loan balances, interest and fees; represents a Non-GAAP financial measure, see Appendix for Non-GAAP reconciliation<br>Dollars in thousands<br>• 23.2% YoY growth in net interest<br>income<br>• 2Q21 net interest income includes<br>the recognition of $1.4 million of PPP<br>loan origination fees, which<br>contributed 19 bps to net interest<br>margin<br>• Estimated $3.4 million of PPP fees<br>yet to be recognized<br>• Total interest earning asset yield<br>declined 14 bps while total interest-<br>bearing liability cost decreased 8 bps<br>compared to 1Q21<br>• Excess cash weighed 3 bps on NIM<br>during the quarter<br>• Expect continued stabilization of core<br>net interest margin<br>Growing Net Interest Income With a<br>Stable Core Net Interest Margin<br>Net Interest Income
---
Loan Yield (ex. Loan Fees and PPP)2<br>7<br>1 Excludes loan fees and PPP<br>2 Represents a Non-GAAP financial measure. See Appendix for Non-GAAP reconciliation<br>Dollars in millions<br>Spot<br>Rate<br>2.66%<br>Spot<br>Rate<br>4.25%1<br>Spot<br>Rate<br>0.59%<br>Spot<br>Rate<br>0.58%<br>Deploying Excess Liquidity into Investments Market-Related Loan Yield Pressure as Balances Grow<br>Improving Deposit Mix Resulting in Lower Deposit Costs Lower Overall Funding Costs<br>Net Interest Drivers<br>$2,152 $2,207 $2,301 $2,390 $2,534<br>4.85% 4.73% 4.89% 4.74% 4.56%<br>4.76% 4.69% 4.59% 4.50% 4.37%<br>2Q20 3Q20 4Q20 1Q21 2Q21<br>$295<br>$339 $371 $383 $391<br>3.13%<br>2.68% 2.70% 2.76%<br>2.55%<br>2Q20 3Q20 4Q20 1Q21 2Q21<br>$1,502 $1,597 $1,687 $1,836 $1,898<br>1.38%<br>1.21%<br>0.96%<br>0.81% 0.74%<br>2Q20 3Q20 4Q20 1Q21 2Q21<br>$1,502 $1,597 $1,688 $1,836 $1,898<br>$603 $615 $654 $676 $732 $237 $215 $188 $138 $141 $2,342 $2,427 $2,530 $2,650 $2,771<br>1.17% 1.12%<br>0.92% 0.77% 0.70%<br>2Q20 3Q20 4Q20 1Q21 2Q21<br>Average Interest-Bearing Deposits Average Noninterest-Bearing Deposits<br>Average Borrowings Cost of Liability Funding<br>Average Investments Investment Yield Average Loans Loan Yield<br>Average Interest-Bearing Deposits Cost of Interest-Bearing Deposits
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1.37% 1.40% 1.34% 1.49% 1.48%<br>0.27%<br>0.02%<br>0.82%<br>0.02% 0.02%<br>1.64%<br>1.42%<br>2.16%<br>1.51% 1.50%<br>48.6%<br>42.3%<br>59.0%<br>41.2% 42.0%<br>40.4% 41.7% 36.6% 40.7% 41.5%<br>2Q20 3Q20 4Q20 1Q21 2Q21<br>Adjusted NIE / Avg. Assets2<br>Adjusted Efficiency Ratio2<br>Adjustment Factors / Avg. Assets2<br>Efficiency Ratio2<br>8<br>Adjusted Efficiency Ratio Consistently in the Low 40% Range Operating Expense Composition<br>1 1Q21 median efficiency ratio for publicly-traded banks with total assets between $1 billion and $10 billion (Source: S&P Global Market Intelligence)<br>2 Represents a Non-GAAP financial measure. See Appendix for Non-GAAP reconciliation<br>Dollars in thousands<br>Efficiency Ratio Among Lowest in Industry<br>Industry median efficiency ratio of 58%1 Expenses expected to increase in-line with asset growth<br>$6,348 $6,550 $6,216 $7,102 $7,512<br>$672 $894 $979<br>$1,055 $980<br>$564<br>$652 $690<br>$753 $849<br>$1,697 $1,576 $1,760<br>$2,013<br>$2,136 $1,430<br>$5,613<br>$10,711<br>$9,672<br>$15,258<br>$10,923<br>$11,477<br>2Q20 3Q20 4Q20 1Q21 2Q21<br>Occupancy Personnel<br>Other Technology<br>FHLB Advance Prepayment Fees
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9<br>• 23.9% YoY loan growth, excluding<br>PPP loans<br>• 2Q21 gross loans grew $232.2<br>million, or 41.2% annualized,<br>excluding PPP loans<br>• Expect near-term annualized loan<br>growth (ex. PPP) in the high teen<br>percent range<br>Dollars in millions<br>• Strong brand and service model in the Twin<br>Cities market<br>• M&A-related market disruption resulting in<br>client and banker acquisition opportunities<br>• PPP-related client acquisition opportunities<br>• Expansion of talented lending teams<br>Robust Loan Growth Continues<br>$2,014 $2,077 $2,188 $2,263<br>$2,495<br>$180 $182<br>$138<br>$163<br>$99<br>$2,194 $2,259<br>$2,326<br>$2,426<br>$2,594<br>2Q20 3Q20 4Q20 1Q21 2Q21<br>BWB Loan Growth Catalysts<br>PPP Loans Gross Loans (ex. PPP)
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10<br>Dollars in millions<br>• Despite payoffs and paydowns of $125 million and a net PPP balance reduction<br>of $64 million in 2Q21, gross loan portfolio grew $168 million from 1Q21<br>• Loan pipeline remains strong and diversified among various asset classes<br>A Proven Loan Growth Engine<br>Up 22%<br>compared to 1Q21<br>Down 43%<br>compared to 1Q21<br>Decrease Increase Total
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CRE NOO<br>29.2%<br>Multifamily<br>30.5%<br>C&D<br>9.7%<br>1-4 Family<br>10.7%<br>CRE OO<br>3.4%<br>C&I<br>12.4%<br>PPP<br>3.8%<br>Consumer &<br>Other 0.3%<br>11<br>Dollars in millions<br>Loan Portfolio Composition<br>Loan Mix<br>by Type<br>$2.59<br>Billion<br>2Q21 Loan Growth by Type (vs. 1Q21)<br>Well-Diversified Loan Portfolio<br>• 2Q21 loan growth across all commercial portfolios, led by multifamily and C&D<br>• Growth in multifamily due to segment expertise and lower portfolio risk characteristics<br>• C&D growth driven by build out of additional lending and credit expertise in the space over the<br>past two years – focus on experienced developers with properties in quality locations<br>• 59% fixed rate, 23% adjustable rate and 18% variable rate<br>• Loan modifications of $34 million at June 30, 2021, or 1.4% of gross loans (ex. PPP)<br>$(64)<br>$(17)<br>$0<br>$8<br>$20<br>$38<br>$58<br>$125 Multifamily<br>C&D<br>CRE NOO<br>C&I<br>CRE OO<br>Consumer & Other<br>1-4 Family<br>PPP
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$649 $686 $672 $713 $758<br>$285 $322 $366<br>$433 $432<br>$517 $498<br>$658<br>$792 $761<br>$382 $364<br>$354<br>$345 $322<br>$409 $403<br>$452<br>$356 $447<br>$2,242 $2,273<br>$2,502<br>$2,639<br>$2,721<br>2Q20 3Q20 4Q20 1Q21 2Q21<br>12<br>• 16.8% YoY growth in noninterest-<br>bearing deposits<br>• Robust deposit inflows reflect both<br>successful new client and banker<br>acquisition initiatives and pandemic-<br>related accumulation of liquidity by<br>existing clients<br>• Increase in brokered deposits<br>included $75 million at 1 basis point<br>late in 2Q21<br>• Core deposits1 were 81% of total<br>deposits (up from 76% at 2Q20)<br>• $169 million in time deposits<br>maturing over the next five quarters at<br>a blended cost of 1.55%<br>• Expect deposit growth to continue to<br>fund loan growth going forward<br>1 Total deposits less brokered deposits and certificates of deposit greater than $250,000<br>Dollars in millions<br>Deposit Growth with Improving Mix<br>Interest-Bearing Transaction Noninterest-Bearing Transaction<br>Time Savings & Money Market<br>Brokered
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$27,633<br>$31,381<br>$34,841 $35,987 $37,591<br>1.37%<br>1.51% 1.59% 1.59%<br>1.50%<br>1.26%<br>1.39%<br>1.50% 1.48% 1.45%<br>2Q20 3Q20 4Q20 1Q21 2Q21<br>$3,740<br>$16,074 $15,164<br>$6,739 $7,195<br>1.20%<br>4.95% 4.54%<br>1.94% 1.99%<br>2Q20 3Q20 4Q20 1Q21 2Q21<br>13<br>Asset Quality<br>Classified Assets Nonperforming Assets1<br>Allowance for Loan Losses Net Charge-Offs<br>Superb Asset Quality Despite COVID Impact<br>3Q20 increase due to two COVID-related relationships Consistently low NPA levels<br>Current reserves at appropriate levels Cumulative NCOs of $642K since 2017<br>¹ Nonaccrual loans, loans 90 days past due and foreclosed assets<br>Dollars in thousands<br>$602<br>$433<br>$775 $770 $761<br>0.02% 0.02% 0.03% 0.03% 0.02%<br>2Q20 3Q20 4Q20 1Q21 2Q21<br>$(48) $2<br>$440<br>$(46) $(4)<br>(0.01)% 0.00%<br>0.08%<br>(0.01)% 0.00%<br>2Q20 3Q20 4Q20 1Q21 2Q21<br>Classified Assets % of Bank Tier 1 Capital + ALLL NPAs % of Assets<br>ALLL % of Gross Loans % of Gross Loans (ex. PPP)<br>Net Charge-offs % of Average Loans (annualized)
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C&I 46.9%<br>CRE NOO Retail<br>16.0%<br>CRE NOO<br>Hotels<br>27.7%<br>1-4 Family<br>1.2%<br>CRE Other<br>8.2%<br>CRE NOO<br>Retail<br>50.2%<br>1-4 Family<br>18.8%<br>Owner<br>Occupied<br>12.0%<br>C&I<br>16.9%<br>C&D<br>1.9%<br>Consumer & Other<br>0.2%<br>$7<br>Million<br>14<br>Investor Real Estate Secured: CRE Nonowner Occupied (“NOO”)<br>Watch List<br>By Loan<br>Type<br>Classified<br>List By<br>Loan Type<br>$57<br>Million<br>Dollars in thousands<br>Watch List Characteristics<br>Loan Balance Outstanding $56,696<br>% of Total Loans, Gross 2.2%<br>Number of Loans 26<br>Average Loan Size $2,181<br>Classified List Characteristics<br>Loan Balance Outstanding $7,195<br>% of Total Loans, Gross 0.3%<br>Number of Loans 19<br>Average Loan Size $379<br>% of Bank Tier 1 Capital + ALLL 1.99%<br>Classified Assets Remain at Modest Levels<br>Majority of Watch and Classified loans are pandemic-related<br>Only 3 hotel relationships as of June 30, 2021, with 2 on Watch
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18.3% 16.8% 18.4% 19.2%<br>15.4%<br>16.1%<br>15.5%<br>19.8%<br>22.3% 25.9%<br>$948<br>$894<br>$1,121<br>$1,273 $1,305<br>2Q20 3Q20 4Q20 1Q21 2Q21<br>9.94% 9.83%<br>9.28% 9.11% 9.08%<br>11.39% 11.03%<br>10.35% 10.34%<br>9.67%<br>15.99%<br>15.45%<br>14.58% 14.46%<br>13.49%<br>2Q20 3Q20 4Q20 1Q21 2Q21<br>15<br>Dollars in millions<br>Consolidated Capital Ratios On & Off-Balance Sheet Liquidity as % of Total Assets<br>Solid Capital and Liquidity Position<br>Completed private placement of $30 million of 3.25% Fixed-to-<br>Floating Rate Subordinated Notes due 2031 on July 8, 2021<br>Focus on utilizing capital to support strong loan growth Securities portfolio completely unencumbered at June 30, 2021<br>Off-Balance Sheet Liquidity as a % of Assets<br>On-Balance Sheet Liquidity as a % of Assets<br>Total Risk-Based Capital Ratio Common Equity Tier 1 Capital Ratio<br>Tier 1 Leverage Ratio
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$254 $262 $262<br>$276<br>$288<br>9.23% 9.46%<br>8.96% 8.99% 9.10%<br>2Q20 3Q20 4Q20 1Q21 2Q21<br>Tangible Common Equity to Tangible Assets1<br>$4.53<br>$5.40<br>$7.22<br>$8.33<br>$9.31<br>$10.22<br>2016 2017 2018 2019 2020 2Q21<br>16<br>Strong Capital and Liquidity<br>Tangible Book Value Per Share1 Tangible Common Equity<br>1 Represents a Non-GAAP financial measure. See Appendix for Non-GAAP reconciliation<br>Dollars in millions, except per share data<br>Growing Tangible Book Value<br>Tangible Common Equity1
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Investor Highlights<br>Investor Highlights<br>Pre-eminent real estate bank in the Twin Cities market with a focus<br>on multifamily lending<br>Operational strategy focused on generating consistently profitable<br>organic growth<br>Superior profitability driven by a highly efficient business model<br>Very experienced and deep group of managers and business<br>producers<br>Primary operations in the growing Twin Cities market, with ample<br>opportunities from bank M&A disruption<br>Proactive risk management approach resulting in continued strong<br>asset quality, despite the pandemic<br>An unconventional culture that is attracting and retaining top talent<br>1<br>2<br>3<br>4<br>5<br>6<br>7<br>Core Values<br>Unconventional Responsive Dedicated Growth Accuracy<br>17
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12.6% 10.3% 7.3% 9.7%<br>13.6% 13.6% 12.7%<br>10.7%<br>24.5%<br>26.9% 26.9%<br>30.5% 3.9%<br>3.5%<br>3.2%<br>3.4%<br>29.5%<br>31.0%<br>30.5%<br>29.2%<br>15.7%<br>14.4%<br>13.1%<br>12.4%<br>6.0%<br>3.8%<br>$1,665<br>$1,912<br>$2,326<br>$2,594<br>2018 2019 2020 2Q21<br>19<br>Dollars in millions<br>Historical Loan Composition<br>• Robust organic growth<br>• Well diversified portfolio<br>among asset classes<br>• Multifamily focus and<br>expertise<br>• Geographic concentration in<br>Twin Cities MSA, with greater<br>than 85% of loans in market<br>1-4 Family Construction and Development<br>Owner-Occupied CRE Multifamily<br>Non Owner-Occupied CRE Commercial & Industrial<br>PPP Consumer & Other
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Dollars in thousands<br>20<br>Investor Real Estate Secured: CRE Nonowner Occupied (“NOO”)<br>Portfolio Characteristics – CRE NOO<br>Loan Balance Outstanding $758,101<br>% of Total Loans, Gross 29.2%<br>Number of Loans 357<br>Average Loan Size $2,124<br>Loan-to-Value (Weighted Average) 60.1%<br>5 Year Net Charge-Offs (%) 0.01%<br>By Property Type<br>Office<br>28.2%<br>Retail<br>20.9%<br>Industrial<br>24.6%<br>Nursing/Assisted<br>Living 9.7%<br>Hotels<br>2.6%<br>Restaurant<br>3.5%<br>Other<br>10.5%<br>$758<br>Million<br>77% 4-6<br>Month<br>Risk Rating Number of Loans 2Q21 Total<br>Pass 345 $ 725,077<br>Watch 9 29,409<br>Classified 3 3,615<br>Total 357 $ 758,101<br>Investor Real Estate Secured –<br>CRE Nonowner Occupied (NOO)
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Dollars in thousands<br>21<br>Portfolio Characteristics – CRE NOO Office<br>Loan Balance Outstanding $213,713<br>% of Total Loans, Gross 8.2%<br>Number of Loans 98<br>Average Loan Size $2,181<br>Loan-to-Value (Weighted Average) 62.0%<br>Investor Real Estate Secured: CRE NOO Retail<br>0-50k Sq Ft,<br>43.8%<br>50k - 125k Sq Ft,<br>20.1%<br>125k - 200k Sq Ft,<br>19.8%<br>200k+ Sq Ft,<br>16.3%<br>$214<br>Million<br>Risk Rating Number of Loans 2Q21 Total<br>Pass 98 $ 213,713<br>Watch --<br>Classified --<br>Total 98 $ 213,713<br>Investor Real Estate Secured –<br>CRE NOO Office<br>By Property Square Footage
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Dollars in thousands<br>22<br>Portfolio Characteristics – CRE NOO Retail<br>Loan Balance Outstanding $158,330<br>% of Total Loans, Gross 6.1%<br>Number of Loans 101<br>Average Loan Size $1,568<br>Loan-to-Value (Weighted Average) 60.3%<br>Investor Real Estate Secured: CRE NOO Retail<br>0-25k Sq Ft,<br>46.6%<br>25k - 75k Sq Ft,<br>31.4%<br>75k - 125k Sq Ft,<br>14.1%<br>125k+ Sq Ft,<br>7.9%<br>$158<br>Million Risk Rating Number of Loans 2Q21 Total<br>Pass 94 $ 145,653<br>Watch 4 9,062<br>Classified 3 3,615<br>Total 101 $ 158,330<br>Investor Real Estate Secured –<br>CRE NOO Retail<br>By Property Square Footage
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Dollars in thousands<br>23<br>Portfolio Characteristics – CRE NOO Industrial<br>Loan Balance Outstanding $186,605<br>% of Total Loans, Gross 7.2%<br>Number of Loans 76<br>Average Loan Size $2,455<br>Loan-to-Value (Weighted Average) 57.43%<br>Investor Real Estate Secured: CRE NOO Retail<br>0-50k Sq Ft,<br>23.1%<br>50k - 125k Sq Ft,<br>35.3%<br>125k+ Sq Ft,<br>41.6% $187<br>Million Risk Rating Number of Loans 2Q21 Total<br>Pass 76 $ 186,605<br>Watch --<br>Classified --<br>Total 76 $ 186,605<br>Investor Real Estate Secured –<br>CRE NOO Industrial<br>By Property Square Footage
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24 1 Based on state of primary real property collateral if available, otherwise borrower address is used<br>Dollars in thousands<br>Investor Real Estate Secured: CRE NOO Hotels<br>Portfolio Characteristics – CRE NOO Hotels<br>Loan Balance Outstanding $19,366<br>% of Total Loans, Gross 0.7%<br>Number of Loans 5<br>Average Loan Size $3,873<br>Loan-to-Value (Weighted Average) 70.5%<br>Twin Cities MSA<br>81.6%<br>MN<br>18.4%<br>$19<br>Million<br>4-6<br>Month<br>100%<br>Risk Rating Number of Loans 2Q21 Total<br>Pass 2 $ 3,659<br>Watch 3 15,707<br>Classified --<br>Total 5 $ 19,366<br>Investor Real Estate Secured –<br>CRE NOO Hotels<br>By Geography1
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25<br>Portfolio Characteristics – CRE NOO Restaurants<br>Loan Balance Outstanding $26,385<br>% of Total Loans, Gross 1.0%<br>Number of Loans 19<br>Average Loan Size $1,389<br>Loan-to-Value (Weighted Average) 62.1%<br>Investor Real Estate Secured: CRE NOO Restaurant<br>Full-Service<br>51.5%<br>Quick-Service<br>28.9%<br>Tap Rooms<br>8.9%<br>Coffee<br>Shops &<br>Bakeries<br>10.7%<br>$26<br>Million<br>96%<br>4-6<br>Month<br>Risk Rating Number of Loans 2Q21 Total<br>Pass 19 $ 26,385<br>Watch --<br>Classified --<br>Total 19 $ 26,385<br>Dollars in thousands<br>Investor Real Estate Secured –<br>CRE NOO Restaurants<br>By Restaurant Type
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5-19 Units<br>15.2%<br>20-49<br>Units<br>26.9%<br>50-99 Units<br>26.0%<br>100+ Units<br>31.9%<br>$790<br>Million<br>26<br>Portfolio Characteristics – Multifamily<br>Loan Balance Outstanding $790,275<br>% of Total Loans, Gross 30.5%<br>Number of Loans 334<br>Average Loan Size $2,366<br>Loan-to-Value (Weighted Average) 63.6%<br>5 Year Net Charge-Offs (%) 0.00%<br>Investor Real Estate Secured: CRE NOO Restaurant<br>44%<br>56%<br>7-12<br>Month<br>Risk Rating Number of Loans 2Q21 Total<br>Pass 334 $ 790,275<br>Watch --<br>Classified --<br>Total 334 $ 790,275<br>Dollars in thousands<br>Investor Real Estate Secured –<br>Multifamily<br>By Unit Type
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Twin Cities MSA<br>96.2%<br>MN<br>0.5%<br>Other<br>States<br>3.3%<br>Residential<br>25.7%<br>Multifamily<br>44.3%<br>CRE Other<br>11.5%<br>Land<br>18.5%<br>$252<br>Million<br>27<br>By<br>Property<br>Type<br>By<br>Geography1<br>Land Portfolio Composition<br>Investor Real Estate Secured: CRE NOO Restaurant<br>Portfolio Characteristics – C&D<br>Loan Balance Outstanding $251,573<br>% of Total Loans, Gross 9.7%<br>% Utilization of Commitments 36.5%<br>Number of Loans 317<br>Average Loan Size $794<br>Loan-to-Value (Weighted Average) 63.2%<br>5 Year Net Charge-Offs (%) 0.00%<br>Finished<br>Lots,<br>29.3%<br>Developed<br>Land,<br>59.4%<br>Undeveloped<br>Land, 11.2%<br>$46<br>Million<br>1 Based on state of primary real property collateral if available, otherwise borrower address is used<br>Dollars in thousands<br>Investor Real Estate Secured –<br>Construction and Development<br>$252<br>Million
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28<br>Investor Real Estate Secured: CRE Nonowner Occupied (“NOO”)<br>Portfolio Characteristics – CRE OO<br>Loan Balance Outstanding $87,507<br>% of Total Loans, Gross 3.4%<br>Number of Loans 144<br>Average Loan Size $608<br>Loan-to-Value (Weighted Average) 58.1%<br>5 Year Net Charge-Offs (%) (0.01)%<br>Office<br>30.1%<br>Retail<br>11.5% Industrial<br>43.2%<br>Restaurant<br>3.3% Other<br>11.9%<br>$88<br>Million<br>4-6<br>Month<br>Risk Rating Number of Loans 2Q21 Total<br>Pass 140 $ 86,642<br>Watch --<br>Classified 4 865<br>Total 144 $ 87,507<br>Dollars in thousands<br>Real Estate Secured –<br>CRE Owner Occupied<br>By Property Type
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Real Estate<br>and Rental<br>and Leasing,<br>35.9%<br>Construction,<br>12.4% Manufacturing,<br>15.8%<br>Finance &<br>Insurance,<br>9.9%<br>Other,<br>9.0%<br>Professional<br>Services,<br>7.0%<br>Wholesale/Retail<br>Trade, 5.9%<br>Accomodation &<br>Food Services,<br>4.2%<br>$321<br>Million<br>29 1 Distribution by North American Industry Classification System (NAICS). Any industries included in Other category are individually < 3% of total portfolio<br>Dollars in thousands<br>Portfolio Characteristics – C&I<br>Loan Balance Outstanding $321,474<br>% of Total Loans, Gross 12.4%<br>Number of Loans 737<br>Average Loan Size $436<br>Number of Relationships 472<br>5 Year Net Charge-Offs (%) 0.03%<br>4-6<br>Month<br>Risk Rating Number of Loans 6/30/21 Total<br>Pass 717 $ 293,690<br>Watch 14 26,571<br>Classified 6 1,213<br>Total 737 $ 321,474<br>Commercial and Industrial<br>By Industry1
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Existing Client<br>57.7%<br>New Client<br>42.3%<br>30<br>New vs.<br>Existing<br>Client<br>PPP Origination Summary as of 6/30/2021<br>Number of<br>Loans<br>Principal<br>Balance<br>Origination<br>Fees<br>Round 1 1,200 $ 181,600 $ 5,706<br>Round 2 651 78,386 3,544<br>Total 1,851 $ 259,986 $ 9,250<br>Dollars in thousands<br>PPP Outstanding Summary<br>As of and for the Three Months Ended 6/30/2021 Program Lifetime<br># of Loans Principal<br>Balance Net Fees Earned Unrecognized<br>Fees<br>Net Fees<br>Generated Net Fees Earned<br>Round 1 225 $ 27,184 $ 971 $ 376 $ 5,706 $ 5,330<br>Round 2 606 71,888 430 3,046 3,544 498<br>Total 831 $ 99,072 $1,401 $ 3,422 $ 9,250 $ 5,828<br>PPP Loans
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23.6% 24.5%<br>26.9% 27.9%<br>11.5%<br>14.5%<br>14.6%<br>15.9%<br>25.8%<br>28.3%<br>26.3%<br>28.0%<br>20.4%<br>19.8%<br>14.1%<br>11.8%<br>18.7%<br>12.9%<br>18.1%<br>16.4%<br>$1,561<br>$1,823<br>$2,502<br>$2,721<br>2018 2019 2020 2Q21<br>31 1 Total deposits less brokered deposits and certificates of deposit greater than $250,000<br>Dollars in millions<br>• Continue to attract in-market<br>lenders and deposit gatherers<br>with loyal client bases from<br>institutions disrupted by M&A<br>• Core deposits1 increased from<br>74% of total deposits in 2018 to<br>81% as of June 30, 2021<br>• Will continue to opportunistically<br>and efficiently supplement core<br>deposits with low-cost brokered<br>deposits<br>Historical Deposit Composition<br>Interest-Bearing Transaction Noninterest-Bearing Transaction<br>Time Savings & Money Market<br>Brokered
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32<br>Dollars in thousands<br>Loan Portfolio – Repricing Composition<br>Variable/Adjustable Loans vs. Rate Floors<br>Fixed/Adjustable Years to Maturity/Repricing<br>Loan Portfolio Repricing<br>Fixed,<br>59.1%<br>Variable,<br>22.9%<br>Adjustable,<br>18.0%<br>85%<br>74% 62% 73% 71%<br>85% 15%<br>26%<br>38% 27%<br>29%<br>15%<br>$299,712<br>$202,731<br>$285,398 $259,263<br>$366,016<br>$585,442<br>Less Than<br>1 Year<br>1 to 2 Years 2 to 3 Years 3 to 4 Years 4 to 5 Years 5+ Years<br>Index Rate At Floor 0 to -25 bps -26 to -50 bps -51 to -75 bps -76 to -100 bps > -100 bps Total<br>PRIME 302,942 $ 24,576 $ 7,346 $ 21 $ 145 $ 62 $ 335,093 $<br>Libor 177,542 12,256 - - 6,560 - 196,358<br>2 Yr FHLB 9,757 - - - - - 9,757<br>3 Yr FHLB 76,962 - - - - - 76,962<br>5 Yr FHLB 67,374 - - - - - 67,374<br>1 Yr CMT 3,764 - - - - - 3,764<br>2 Yr CMT 120 - 8,486 - - - 8,606<br>3 Yr CMT 64,751 3,655 2,358 772 9,922 11,348 92,805<br>5 Yr CMT 159,673 1,204 2,325 5,472 1,694 11,463 181,830<br>10 Yr CMT - - - - - - -<br>Total 862,885 $ 41,691 $ 20,515 $ 6,265 $ 18,321 $ 22,873 $ 972,549 $<br>Adjustable Fixed
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33 1 Rate indicated assumes renewal into like term at market rates as of July 26, 2021<br>Dollars in thousands<br>Time Deposit Maturities Time Deposit Repricing<br>Deposit Repricing Opportunities<br>$169 million in time deposits maturing over the next five<br>quarters at a blended cost of 1.55%<br>$33,166<br>$23,176<br>$17,081 $19,899<br>$8,415<br>$10,158 $29,178<br>$11,450<br>$13,888<br>$2,946<br>$43,324<br>$52,354<br>$28,531<br>$33,787<br>$11,361<br>3Q21 4Q21 1Q22 2Q22 3Q22<br>Wholesale Time Deposit Maturities Retail Time Deposit Maturities<br>Maturity Dates Balance<br>Weighted<br>Avg. Yield<br>Implied<br>Repricing<br>Rate1<br>% of Total<br>Portfolio<br>Jul-21 13,093 $ 1.53% 0.35% 2.41%<br>Aug-21 16,679 1.68% 0.41% 3.07%<br>Sep-21 13,551 1.21% 0.33% 2.49%<br>Oct-21 27,043 1.51% 0.53% 4.97%<br>Nov-21 10,681 1.37% 0.42% 1.96%<br>Dec-21 14,630 1.62% 0.44% 2.69%<br>Jan-22 10,911 1.34% 0.36% 2.01%<br>Feb-22 11,238 1.69% 0.56% 2.07%<br>Mar-22 6,382 1.27% 0.36% 1.17%<br>Apr-22 12,435 1.96% 0.50% 2.29%<br>May-22 10,848 1.58% 0.42% 1.99%<br>Jun-22 10,505 1.66% 0.50% 1.93%<br>Jul-22 3,836 1.41% 0.38% 0.71%<br>Aug-22 4,883 1.63% 0.63% 0.90%<br>Sep-22 2,643 1.78% 0.54% 0.49%<br>Total 169,355 $ 1.55% 0.45% 31.14%
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4.00%<br>1.08%<br>2.91%<br>Minneapolis Midwest US<br>$86,382<br>$64,386 $67,761<br>Minneapolis Midwest US<br>#1<br>Fortune 500 companies<br>per capita (16)1<br>Large Corporate Presence<br>#1<br>State with highest average<br>credit score (720)2<br>Credit Worthy Population<br>#1<br>Best place for women<br>entrepreneurs3<br>Women Entrepreneurs<br>#5<br>State with educational<br>achievement beyond high<br>school (59% of age 25-64<br>population)4<br>Educated Workforce<br>#7<br>America’s top states for<br>business5<br>Business Focus<br>Top 20<br>Most populated area in the<br>U.S. with 4% projected<br>population growth by 2026<br>High Growth MSA<br>1 Source: Minnesota Department of Employment and Economic Development<br>2 Source: Experian – State of Credit, 2020<br>3 Source: Minneapolis-St. Paul Smart AssetTM, 2020<br>4 Source: Lumina Foundation, A Stronger Nation – National Report, 2019<br>5 Source: CNBC, 2019<br>6 Source: S&P Global Market Intelligence, Midwest includes ND, SD, NE, KS, MN, IA, MO, WI, IL, IN and OH<br>Banking industry disruption caused by M&A<br>activity leading to opportunities for client and<br>talent acquisition<br>Banking Industry Disruption<br>2021 Median Household Income ($)⁶<br>2021 – 2026 Proj. Population Growth (%)⁶<br>Attractive Twin Cities/Minnesota Market<br>34
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35<br>Source: S&P Global Market Intelligence; deposit market share data as of June 30, 2020<br>Growing Market Share<br>2006 Total Market 2020 Total Market<br>Top 10 Institutions Deposits ($000) Share Top 10 Institutions Deposits ($000) Share<br>Wells Fargo & Co. 16,308,234 $ 27.59% U.S. Bancorp 83,341,943 $ 38.23%<br>U.S. Bancorp 15,535,660 $ 26.28% Wells Fargo & Co. 65,154,088 $ 29.88%<br>TCF Financial Corp. 3,686,508 $ 6.24% TCF Financial Corp. 8,226,068 $ 3.77%<br>Marshall & Iisley Corp. 1,729,917 $ 2.93% Bank of Montreal 5,928,722 $ 2.72%<br>Bremer Financial Corp. 1,720,239 $ 2.91% Bremer Financial Corp. 5,801,429 $ 2.66%<br>Associated Banc-Corp 1,162,530 $ 1.97% Ameriprise Bank, fsb 5,300,381 $ 2.43%<br>Klein Financial Inc. 880,289 $ 1.49% Bank of America Corp. 4,634,383 $ 2.13%<br>Inter Savings Bank, fsb 558,660 $ 0.94% Old National Bancorp 3,585,042 $ 1.64%<br>Excel Bank Corp. 505,614 $ 0.86% Bridgewater Bancshares, Inc. 2,289,454 $ 1.05%<br>American Bancorp 457,414 $ 0.77% Associated Banc-Corp 2,277,702 $ 1.04%<br>Total Deposits 42,545,065 $ 71.98% Total Deposits 186,539,212 $ 85.55%<br>Total Bank Deposits 59,119,026 $ 197 Total Bank Deposits 218,026,091 $ 144<br>% of Twin Cities MSA Deposits 71.98% % of Twin Cities MSA Deposits 85.55%<br>Total Bank Deposits - Minneapolis-St.Paul-Bloomington, MN-WI MSA<br>2006 2020
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36<br>This presentation includes certain non-GAAP financial measures intended to supplement, not substitute for, comparable GAAP measures. Reconciliations of these<br>non-GAAP financial measures are provided below. The Company believes these non-GAAP financial measures provide useful information to both management and<br>investors to analyze and evaluate the Company’s financial performance. Because not all companies use the same calculations for these measures, the information<br>in this presentation may not be comparable to other similarly titled measures as calculated by other companies.<br>* Efficiency Ratio is adjusted to exclude the historic tax credit amortization and FHLB prepayment fees.<br>Dollars in thousands<br>Efficiency Ratio 2016 2017 2017* 2018 2018* 2019 2019* 2020 2020*<br>Noninterest Expense 20,168 $ 25,496 $ 25,496 $ 31,562 $ 31,562 $ 36,932 $ 36,932 $ 45,387 $ 45,387 $<br>Less: Amortization of Tax Credit Investments - - (1,916) - (3,293) - (3,225) - (738)<br>Less: FHLB Advances Prepayment Fee - - - - - - - - (7,043)<br>Less: Amortization Intangible Assets (104) (191) (191) (191) (191) (191) (191) (191) (191)<br>Adjusted Noninterest Expense 20,064 $ 25,305 $ 23,389 $ 31,371 $ 28,078 $ 36,741 $ 33,516 $ 45,196 $ 37,415 $<br>Net Interest Income 42,118 $ 54,173 $ 54,173 $ 64,738 $ 64,738 $ 74,132 $ 74,132 $ 87,964 $ 87,964 $<br>Noninterest Income 2,567 2,536 2,536 2,543 2,543 3,826 3,826 5,839 5,839<br>Less: (Gain) Loss on Sales of Securities (830) 250 250 125 125 (516) (516) (1,503) (1,503)<br>Adjusted Operating Revenue 43,855 $ 56,959 $ 56,959 $ 67,406 $ 67,406 $ 77,442 $ 77,442 $ 92,300 $ 92,300 $<br>Efficiency Ratio 45.8% 44.4% 41.1% 46.5% 41.7% 47.4% 43.3% 49.0% 40.5%<br>Tangible Common Equity &<br>Tangible Common Equity/Tangible<br>Assets 2016 2017 2018 2019 2020<br>Common Equity 115,366 $ 137,162 $ 220,998 $ 244,794 $ 265,405 $<br>Less: Intangible Assets (4,060) (3,869) (3,678) (3,487) (3,296)<br>Tangible Common Equity 111,306 $ 133,293 $ 217,320 $ 241,307 $ 262,109 $<br>Total Assets 1,260,394 $ 1,616,612 $ 1,973,741 $ 2,268,830 $ 2,927,345 $<br>Less: Intangible Assets (4,060) (3,869) (3,678) (3,487) (3,296)<br>Tangible Assets 1,256,334 $ 1,612,743 $ 1,970,063 $ 2,265,343 $ 2,924,049 $<br>Tangible Common Equity/Tangible Assets 8.86% 8.26% 11.03% 10.65% 8.96%<br>Tangible Book Value Per Share 2016 2017 2018 2019 2020<br>Book Value Per Common Share 4.69 $ 5.56 $ 7.34 $ 8.45 $ 9.43 $<br>Less: Effects of Intangible Assets (0.17) (0.16) (0.12) (0.12) (0.12)<br>Tangible Book Value Per Common Share 4.52 $ 5.40 $ 7.22 $ 8.33 $ 9.31 $<br>Total Common Shares 24,589,861 24,679,861 30,097,274 28,973,572 28,143,493<br>As of and for the year ended December 31 for year end data,<br>As of and for the year ended December 31 for year end data,<br>Reconciliation of Annual Non-GAAP<br>Financial Measures
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37<br>This presentation includes certain non-GAAP financial measures intended to supplement, not substitute for, comparable GAAP measures. Reconciliations of these<br>non-GAAP financial measures are provided below. The Company believes these non-GAAP financial measures provide useful information to both management and<br>investors to analyze and evaluate the Company’s financial performance. Because not all companies use the same calculations for these measures, the information<br>in this presentation may not be comparable to other similarly titled measures as calculated by other companies.<br>* Efficiency Ratio is adjusted to exclude the historic tax credit amortization and FHLB prepayment fees.<br>Dollars in thousands<br>Reconciliation of Quarterly Non-GAAP<br>Financial Measures<br>Efficiency Ratio<br>June 30,<br>2020<br>June 30,<br>2020*<br>September 30,<br>2020<br>September 30,<br>2020*<br>December 31,<br>2020<br>December 31,<br>2020*<br>March 31,<br>2021<br>March 31,<br>2021*<br>June 30,<br>2021<br>June 30,<br>2021*<br>Noninterest Expense 10,711 $ 10,711 $ 9,672 $ 9,672 $ 15,258 $ 15,258 $ 10,923 $ 10,923 $ 11,477 $ 11,477 $<br>Less: Amortization of Tax Credit Investments - (362) - (145) - (146) - (118) - (140)<br>Less: FHLB Advances Prepayment Fee - (1,430) - - - (5,613) - - - -<br>Less: Amortization Intangible Assets (47) (47) (48) (48) (48) (48) (48) (48) (47) (47)<br>Adjusted Noninterest Expense 10,664 $ 8,872 $ 9,624 $ 9,479 $ 15,210 $ 9,451 $ 10,875 $ 10,757 $ 11,430 $ 11,290 $<br>Net Interest Income 21,342 $ 21,342 $ 21,679 $ 21,679 $ 24,841 $ 24,841 $ 25,395 $ 25,395 $ 26,288 $ 26,288 $<br>Noninterest Income 1,977 1,977 1,157 1,157 986 986 1,008 1,008 1,603 1,603<br>Less: Gain on Sales of Securities (1,361) (1,361) (109) (109) (30) (30) - - (702) (702)<br>Adjusted Operating Revenue 21,958 $ 21,958 $ 22,727 $ 22,727 $ 25,797 $ 25,797 $ 26,403 $ 26,403 $ 27,189 $ 27,189 $<br>Efficiency Ratio 48.6% 40.4% 42.3% 41.7% 59.0% 36.6% 41.2% 40.7% 42.0% 41.5%<br>Tangible Common Equity &<br>Tangible Common Equity/Tangible<br>Assets<br>June 30,<br>2020<br>September 30,<br>2020<br>December 31,<br>2020<br>March 31,<br>2021<br>June 30,<br>2021<br>Common Equity 257,190 $ 265,432 $ 265,405 $ 279,171 $ 290,830 $<br>Less: Intangible Assets (3,391) (3,344) (3,296) (3,248) (3,200)<br>Tangible Common Equity 253,799 $ 262,088 $ 262,109 $ 275,923 $ 287,630 $<br>Total Assets 2,754,463 $ 2,774,564 $ 2,927,345 $ 3,072,359 $ 3,162,612 $<br>Less: Intangible Assets (3,391) (3,344) (3,296) (3,248) (3,200)<br>Tangible Assets 2,751,072 $ 2,771,220 $ 2,924,049 $ 3,069,111 $ 3,159,412 $<br>Tangible Common Equity/Tangible Assets 9.23% 9.46% 8.96% 8.99% 9.10%<br>Tangible Book Value Per Share<br>June 30,<br>2020<br>September 30,<br>2020<br>December 31,<br>2020<br>March 31,<br>2021<br>June 30,<br>2021<br>Book Value Per Common Share 8.92 $ 9.25 $ 9.43 $ 9.92 $ 10.33 $<br>Less: Effects of Intangible Assets (0.12) (0.12) (0.12) (0.12) (0.11)<br>Tangible Book Value Per Common Share 8.80 $ 9.13 $ 9.31 $ 9.80 $ 10.22 $<br>Total Common Shares 28,837,560 28,710,775 28,143,493 28,132,929 28,162,777<br>As of and for the quarter ended,<br>As of and for the quarter ended,
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38<br>This presentation includes certain non-GAAP financial measures intended to supplement, not substitute for, comparable GAAP measures. Reconciliations of these<br>non-GAAP financial measures are provided below. The Company believes these non-GAAP financial measures provide useful information to both management and<br>investors to analyze and evaluate the Company’s financial performance. Because not all companies use the same calculations for these measures, the information<br>in this presentation may not be comparable to other similarly titled measures as calculated by other companies.<br>Dollars in thousands<br>Reconciliation of Quarterly Non-GAAP<br>Financial Measures – PPNR<br>Pre-Provision Net Revenue<br>June 30,<br>2020<br>September 30,<br>2020<br>December 31,<br>2020<br>March 31,<br>2021<br>June 30,<br>2021<br>Noninterest Income 1,977 $ 1,157 $ 986 $ 1,008 $ 1,603 $<br>Less: Gain on sales on Securities (1,361) (109) (30) - (702)<br>Total Operating Noninterest Income 616 1,048 956 1,008 901<br>Plus: Net Interest Income 21,342 21,679 24,841 25,395 26,288<br> Net Operating Revenue 21,958 22,727 25,797 26,403 27,189<br>Noninterest Expense 10,711 9,672 15,258 10,923 11,477<br>Less: Amortization of Tax Credit Investments (362) (145) (146) (118) (140)<br>Less: FHLB Advances Prepayment Fees (1,430) - (5,613) - -<br> Total Operating Noninterest Expense 8,919 9,527 9,499 10,805 11,337<br>Pre-Provision Net Revenue 13,039 $ 13,200 $ 16,298 $ 15,598 $ 15,852 $<br> Plus:<br>Non-Operating Revenue Adjustments 1,361 109 30 - 702<br> Less:<br>Provision for Loan Losses 3,000 3,750 3,900 1,100 1,600<br>Non-Operating Expense Adjustments 1,792 145 5,759 118 140<br>Provision for Income Taxes 2,010 2,240 1,690 3,709 3,821<br>Net Income 7,598 $ 7,174 $ 4,979 $ 10,671 $ 10,993 $<br>Average Assets 2,622,272 $ 2,711,755 $ 2,816,032 $ 2,940,262 $ 3,076,712 $<br>Pre-Provision Net Revenue Return on Average Assets 2.00% 1.94% 2.30% 2.15% 2.07%<br>As of and for the quarter end,
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39<br>This presentation includes certain non-GAAP financial measures intended to supplement, not substitute for, comparable GAAP measures. Reconciliations of these<br>non-GAAP financial measures are provided below. The Company believes these non-GAAP financial measures provide useful information to both management and<br>investors to analyze and evaluate the Company’s financial performance. Because not all companies use the same calculations for these measures, the information<br>in this presentation may not be comparable to other similarly titled measures as calculated by other companies.<br>Dollars in thousands<br>Reconciliation of Quarterly Non-GAAP<br>Financial Measures – Core NIM<br>Pre-Provision Net Revenue<br>June 30,<br>2020<br>September 30,<br>2020<br>December 31,<br>2020<br>March 31,<br>2021<br>June 30,<br>2021<br>Net Interest Income (Tax-Equivalent Basis) 21,581 $ 21,898 $ 25,051 $ 25,609 $ 26,495 $<br>Less: Loan Fees (1,264) (1,198) (1,514) (1,202) (1,023)<br>Less: PPP Interest and Fees (873) (1,173) (2,097) (1,864) (1,767)<br> Core Net Interest Margin 19,444 $ 19,527 $ 21,440 $ 22,543 $ 23,705 $<br>Average Interest Earning Assets 2,567,292 $ 2,655,882 $ 2,759,543 $ 2,883,084 $ 3,019,437 $<br>Less: Avergage PPP Loans (139,235) (181,397) (165,099) (148,881) (149,312)<br> Core Average Interest Earning Assets 2,428,057 $ 2,474,485 $ 2,594,444 $ 2,734,203 $ 2,870,125 $<br>Core Net Interest Margin 3.22% 3.14% 3.29% 3.34% 3.31%<br>Loan Interest Income (Tax-Equivalent Basis) 25,943 $ 26,254 $ 28,265 $ 27,938 $ 28,778 $<br>Less: Loan Fees (1,264) (1,198) (1,514) (1,202) (1,023)<br>Less: PPP Interest and Fees (873) (1,173) (2,097) (1,864) (1,767)<br> Core Loan Interest Income 23,806 $ 23,883 $ 24,654 $ 24,872 $ 25,988 $<br>Average Loans 2,152,398 $ 2,206,807 $ 2,301,328 $ 2,389,919 $ 2,534,071 $<br>Less: Avergage PPP Loans (139,235) (181,397) (165,099) (148,881) (149,312)<br> Core Average Loans 2,013,163 $ 2,025,410 $ 2,136,229 $ 2,241,038 $ 2,384,759 $<br>Core Loan Yield 4.76% 4.69% 4.59% 4.50% 4.37%<br>As of and for the quarter end,
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