8-K - BWB - Equibles

UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 8-K CURRENT REPORT

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

July 26, 2023

Date of Report

(Date of earliest event reported)

BRIDGEWATER BANCSHARES, INC.

(Exact name of registrant as specified in its charter)

<br><br><br><br>	<br><br>	<br><br><br><br>
Minnesota<br><br>(State or other jurisdiction of<br><br>incorporation)	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)

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

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

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

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

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

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

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

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

Title of each class:	Trading Symbol	Name of each exchange on which registered:
Common Stock, $0.01 Par Value<br><br>Depositary Shares, each representing a 1/100th interest in a share of 5.875% Non-Cumulative Perpetual Preferred Stock, Series A	BWB<br><br>BWBBP	The NASDAQ Stock Market LLC<br><br>The NASDAQ Stock Market LLC

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☒

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 R esults of Operations and Financial Condition.

On July 26, 2023, Bridgewater Bancshares, Inc. (the “Company”) issued a press release announcing its financial results for the three and six months ended June 30, 2023. A copy of the press release is attached as Exhibit 99.1 to this Current Report on 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 R egulation 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 8.01 Other Events .

On July 26, 2023, in its 2023 second quarter earnings release, the Company announced that its Board of Directors had declared a quarterly cash dividend on its 5.875% Non-Cumulative Perpetual Preferred Stock, Series A (“Series A Preferred Stock”). The quarterly cash dividend of $36.72 per share, equivalent to $0.3672 per depository share, each representing a 1/100^th^ interest in a share of the Series A Preferred Stock (Nasdaq: BWBBP), is payable on September 1, 2023, to shareholders of record of the Series A Preferred Stock at the close of business on August 15, 2023.

Item 9.01 Financial Statements and Exhibits.

(d)****Exhibits

Exhibit 99.1	Press Release of Bridgewater Bancshares, Inc., dated July 26, 2023, regarding second quarter 2023 financial results
Exhibit 99.2	Earnings Presentation dated July 26, 2023
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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.


	Bridgewater Bancshares, Inc.


Date: July 26, 2023
	By: /s/ Jerry Baack
	Name: Jerry Baack
	Title: Chairman, Chief Executive Officer and President

Exhibit 99.1


Media Contact: Jessica Stejskal	SVP Marketing<br>Jessica.stejskal@bwbmn.com	952.893.6860	Investor Contact: Justin Horstman	Director of Investor Relations<br>Justin.Horstman@bwbmn.com	952.542.5169

July 26, 2023

Bridgewater Bancshares, Inc. Announces Second Quarter 2023 Net Income of $9.8 Million, $0.31 Diluted Earnings Per Common Share

Second Quarter 2023 Highlights

●	Annualized return on average assets (ROA) of 0.88%, compared to 1.07% for the first quarter of 2023.

●	Annualized return on average shareholders’ equity (ROE) of 9.69%, compared to 11.70% for the first quarter of 2023, and annualized return on average tangible common equity (ROATCE)^(1)^ of 10.48%, compared to 12.90% for the first quarter of 2023.

●	Gross loans increased $51.9 million, or 5.6% annualized, from the first quarter of 2023.

●	Deposits increased by $166.8 million, or 19.6% annualized, from the first quarter of 2023, including an increase of core deposits^(2)^ of $45.3 million, or 7.4% annualized.

●	Total borrowing capacity of $1.5 billion at June 30, 2023, compared to $783.0 million at December 31, 2022.

●	Net interest margin (on a fully tax-equivalent basis) of 2.40%, compared to 2.72% in the first quarter of 2023.

●	Efficiency ratio^(1)^ of 52.7%, compared to 46.2% for the first quarter of 2023.

●	Noninterest expense increased slightly by $205,000, or 1.4%, from the first quarter of 2023, with annualized noninterest expense to average assets of 1.29%, compared to 1.31% for the first quarter of 2023.

●	A credit loss provision of $550,000 was recorded to support continued loan growth, with allowance for credit losses to total loans of 1.36% at both June 30, 2023 and March 31, 2023.

●	Annualized net loan charge-offs (recoveries) as a percentage of average loans of 0.00% for the second quarter of 2023, in-line with the first quarter of 2023.

●	Nonperforming assets to total assets of 0.02% at June 30, 2023 and March 31, 2023.

●	Tangible book value per share^(1)^ of $12.15 at June 30, 2023, an increase of $0.20, or 6.7% annualized, compared to $11.95 at March 31, 2023.

(1)	Represents a non-GAAP financial measure. See "Non-GAAP Financial Measures" for further details.
(2)	Core deposits are defined as total deposits less brokered deposits and certificates of deposit greater than $250,000.
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Page 1 of 17

St. Louis Park, MN – Bridgewater Bancshares, Inc. (Nasdaq: BWB) (the Company), the parent company of Bridgewater Bank (the Bank), today announced net income of $9.8 million for the second quarter of 2023, compared to $11.6 million for the first quarter of 2023, and $12.9 million for the second quarter of 2022. Earnings per diluted common share for the second quarter of 2023 were $0.31, compared to $0.37 per diluted common share for the first quarter of 2023, and $0.41 per diluted common share for the same period in 2022.

“Bridgewater’s second quarter results were highlighted by several improving financial trends as we continue to manage the business through a challenging banking environment,” said Chairman, Chief Executive Officer, and President, Jerry Baack. “The overall composition of our balance sheet improved with a strong inflow of deposits, including growth in core deposits, and a reduction in overall borrowings. While our net interest margin remained under pressure, we saw the pace of compression slow noticeably on a month-to-month basis during the quarter. In addition, noninterest expense was again well controlled and asset quality remained superb.”

“During the quarter, our teams maintained their focus on supporting and growing our client base, both by proactively engaging with our existing clients and cultivating new relationships across the Twin Cities market. In July, we also relocated our downtown Minneapolis branch to an enhanced location with more space to better serve our clients. We believe our proven ability to develop strong client relationships, combined with encouraging financial trends, will continue to drive success moving forward.”

Page 2 of 17

Key Financial Measures


		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,
	****	2023			2023			2022			****	2023		****	2022
Per Common Share Data
Basic Earnings Per Share		$	0.32		$	0.38		$	0.43			$	0.70		$	0.83
Diluted Earnings Per Share			0.31			0.37			0.41				0.69			0.80
Book Value Per Share			12.25			12.05			11.14				12.25			11.14
Tangible Book Value Per Share ^(1)^			12.15			11.95			11.03				12.15			11.03
Basic Weighted Average Shares Outstanding			27,886,425			27,726,894			27,839,260				27,807,100			27,980,749
Diluted Weighted Average Shares Outstanding			28,198,739			28,490,046			28,803,842				28,350,705			28,991,780
Shares Outstanding at Period End			27,973,995			27,845,244			27,677,372				27,973,995			27,677,372

Selected Performance Ratios
Return on Average Assets (Annualized)			0.88	%		1.07	%		1.38	%			0.97	%		1.40	%
Pre-Provision Net Revenue Return on Average Assets (Annualized) ^(1)^			1.16			1.49			2.19				1.32			2.16
Return on Average Shareholders' Equity (Annualized)			9.69			11.70			13.55				10.69			13.27
Return on Average Tangible Common Equity (Annualized)^(1)^			10.48			12.90			15.26				11.68			14.91
Yield on Interest Earning Assets^(2)^			5.06			4.91			4.16				4.99			4.15
Yield on Total Loans, Gross^(2)^			5.19			5.06			4.45				5.12			4.45
Cost of Total Deposits			2.66			2.01			0.46				2.34			0.44
Cost of Funds			2.91			2.41			0.63				2.66			0.61
Net Interest Margin^(2)^			2.40			2.72			3.58				2.55			3.59
Core Net Interest Margin ^(1)(2)^			2.31			2.62			3.34				2.47			3.34
Efficiency Ratio^(1)^			52.7			46.2			40.2				49.3			41.2
Noninterest Expense to Average Assets (Annualized)			1.29			1.31			1.47				1.30			1.51
Loan to Deposit Ratio			104.4			108.0			100.7
Core Deposits to Total Deposits ^(3)^			70.3			72.4			82.9
Tangible Common Equity to Tangible Assets ^(1)^			7.39			7.23			7.87

Capital Ratios (Bank Only) ^(4)^
Tier 1 Leverage Ratio			10.69	%		10.61	%		11.43	%
Common Equity Tier 1 Risk-based Capital Ratio			11.66			11.37			11.53
Tier 1 Risk-based Capital Ratio			11.66			11.37			11.53
Total Risk-based Capital Ratio			12.91			12.62			12.74

Capital Ratios (Consolidated)^(4)^
Tier 1 Leverage Ratio			9.47	%		9.41	%		10.33	%
Common Equity Tier 1 Risk-based Capital Ratio			8.72			8.48			8.50
Tier 1 Risk-based Capital Ratio			10.33			10.08			10.29
Total Risk-based Capital Ratio			13.50			13.25			13.98

(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


		June 30,			March 31,		December 31,		September 30,		June 30,
(dollars in thousands)	****	2023		****	2023		2022		2022		2022
Selected Balance Sheet Data
Total Assets		$	4,603,185		$	4,602,899	$	4,345,662	$	4,128,987	$	3,883,264
Total Loans, Gross			3,736,211			3,684,360		3,569,446		3,380,082		3,225,885
Allowance for Credit Losses			50,701			50,148		47,996		46,491		44,711
Goodwill and Other Intangibles			2,832			2,866		2,914		2,962		3,009

Deposits			3,577,932			3,411,123		3,416,543		3,305,074		3,201,953
Tangible Common Equity^(1)^			339,780			332,626		324,636		312,531		305,360
Total Shareholders' Equity			409,126			402,006		394,064		382,007		374,883
Average Total Assets - Quarter-to-Date			4,483,662			4,405,234		4,251,345		3,948,201		3,743,575
Average Shareholders' Equity - Quarter-to-Date			406,347			403,533		387,589		384,020		381,448

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


	For the Three Months Ended							For the Six Months Ended
	June 30,		March 31,			June 30,		June 30,			June 30,
(dollars in thousands)	2023		2023		****	2022		2023		****	2022
Selected Income Statement Data
Interest Income	$	55,001	$	51,992		$	37,782	$	106,993		$	72,476
Interest Expense		29,129		23,425			5,252		52,554			9,766
Net Interest Income		25,872		28,567			32,530		54,439			62,710
Provision for Credit Losses		50		625			3,025		675			4,700
Net Interest Income after Provision for Credit Losses		25,822		27,942			29,505		53,764			58,010
Noninterest Income		1,415		1,943			1,650		3,358			3,207
Noninterest Expense		14,388		14,183			13,752		28,571			27,260
Income Before Income Taxes		12,849		15,702			17,403		28,551			33,957
Provision for Income Taxes		3,033		4,060			4,521		7,093			8,813
Net Income		9,816		11,642			12,882		21,458			25,144
Preferred Stock Dividends		(1,014)		(1,013)			(1,014)		(2,027)			(2,027)
Net Income Available to Common Shareholders	$	8,802	$	10,629		$	11,868	$	19,431		$	23,117

Income Statement

Net Interest Income

Net interest income was $25.9 million for the second quarter of 2023, a decrease of $2.7 million, from $28.6 million in the first quarter of 2023, and a decrease of $6.7 million, from $32.5 million in the second quarter of 2022. The linked-quarter decrease in net interest income was primarily due to higher rates paid on deposits in the rising interest rate environment. The year-over-year decrease in net interest income was primarily due to higher rates paid on deposits and increased borrowings in the rising interest rate environment. Average interest earning assets were $4.40 billion for the second quarter of 2023, an increase of $71.3 million, or 1.7%, from $4.32 billion for the first quarter of 2023, and an increase of $723.3 million, or 19.7%, from $3.67 billion for the second quarter of 2022. The linked-quarter increase in average interest earning assets was primarily due to continued growth in the loan portfolio. The year-over-year increase in average interest earning assets was primarily due to strong growth in the loan portfolio and purchases of investment securities.

Net interest margin (on a fully tax-equivalent basis) for the second quarter of 2023 was 2.40%, a 32 basis point decrease from 2.72% in the first quarter of 2023, and a 118 basis point decrease from 3.58% in the second quarter of 2022. 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 2023 was 2.31%, a 31 basis point decrease from 2.62% in the first quarter of 2023, and a 103 basis point decrease from 3.34% in the second quarter of 2022. The linked-quarter decline in the margin was primarily due to higher funding costs, offset partially by higher earning asset yields. The year-over-year decline in the margin was primarily due to higher funding costs and increased borrowings in the rising interest rate environment, offset partially by higher earning asset yields.

Page 4 of 17

Interest income was $55.0 million for the second quarter of 2023, an increase of $3.0 million, from $52.0 million in the first quarter of 2023, and an increase of $17.2 million, from $37.8 million in the second quarter of 2022. The yield on interest earning assets (on a fully tax-equivalent basis) was 5.06% in the second quarter of 2023, compared to 4.91% in the first quarter of 2023, and 4.16% in the second quarter of 2022. The linked-quarter increase in the yield on interest earning assets was primarily due to the increase in market interest rates resulting in new loan originations and loans repricing at yields accretive to the existing portfolio. The year-over-year increase in the yield on interest earning assets was primarily due to growth and repricing of the loan and securities portfolios in the rising interest rate environment.

Loan interest income and loan fees remain the primary contributing factors to the changes in the yield on interest earning assets. The aggregate loan yield, excluding PPP loans, increased to 5.19% in the second quarter of 2023, which was 13 basis points higher than 5.06% in the first quarter of 2023, and 76 basis points higher than 4.43% in the second quarter of 2022. While loan fees have historically maintained a relatively stable contribution to the aggregate loan yield, the recent periods saw fewer loan prepayments, which historically has accelerated the recognition of loan fees. Despite the decrease in fee recognition, the Company is encouraged that the core loan yield continues to rise as new loan originations and the existing portfolio reprice in the higher rate environment.

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


	Three Months Ended
	June 30, 2023		March 31, 2023		December 31, 2022		September 30, 2022		June 30, 2022
Interest	5.09	%	4.95	%	4.74	%	4.42	%	4.17	%
Fees	0.10		0.11		0.12		0.17		0.26
Yield on Loans, Excluding PPP Loans	5.19	%	5.06	%	4.86	%	4.59	%	4.43	%

Interest expense was $29.1 million for the second quarter of 2023, an increase of $5.7 million, from $23.4 million in the first quarter of 2023, and an increase of $23.9 million, from $5.3 million in the second quarter of 2022. The cost of interest bearing liabilities increased 56 basis points on a linked-quarter basis from 3.03% in the first quarter of 2023 to 3.59% in the second quarter of 2023, primarily due to higher rates paid on deposits and increased utilization of FHLB advances in the rising interest rate environment. On a year-over-year basis, the cost of interest bearing liabilities increased 273 basis points from 0.86% in the second quarter of 2022 to 3.59% in the second quarter of 2023, primarily due to the rapid increase in market interest rates that occurred between the periods, which impacted all funding sources.

Interest expense on deposits was $23.0 million for the second quarter of 2023, an increase of $6.6 million, from $16.4 million in the first quarter of 2023, and an increase of $19.5 million, from $3.5 million in the second quarter of 2022. The cost of total deposits increased 65 basis points on a linked-quarter basis from 2.01% in the first quarter of 2023, to 2.66% in the second quarter of 2023, primarily due to the rising interest rate environment and increased competition from other market alternatives. On a year-over-year basis, the cost of total deposits increased 220 basis points from 0.46% in the second quarter of 2022, to 2.66% in the second quarter of 2023, primarily due to upward repricing of the deposit portfolio in the higher interest rate environment.

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, 2023, March 31, 2023, and June 30, 2022 is as follows:


		For the Three Months Ended																							****
		June 30, 2023								March 31, 2023							****	June 30, 2022							****
		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		$	59,963		$	587		3.93	%	$	63,253		$	447		2.86	%	$	61,046		$	40		0.26	%
Investment Securities:
Taxable Investment Securities			568,143			6,000		4.24			574,242			5,958		4.21			417,142			2,696		2.59
Tax-Exempt Investment Securities^(1)^			27,081			300		4.44			29,803			330		4.49			74,261			795		4.30
Total Investment Securities			595,224			6,300		4.24			604,045			6,288		4.22			491,403			3,491		2.85
Paycheck Protection Program Loans ^(2)^			913			2		1.00			999			2		1.00			8,335			263		12.67
Loans ^(1)(2)^			3,715,621			48,064		5.19			3,629,447			45,263		5.06			3,099,344			34,205		4.43
Total Loans			3,716,534			48,066		5.19			3,630,446			45,265		5.06			3,107,679			34,468		4.45
Federal Home Loan Bank Stock			23,330			456		7.84			25,962			372		5.81			11,620			59		2.04
Total Interest Earning Assets			4,395,051			55,409		5.06	%		4,323,706			52,372		4.91	%		3,671,748			38,058		4.16	%
Noninterest Earning Assets			88,611								81,528								71,827
Total Assets		$	4,483,662							$	4,405,234							$	3,743,575
Interest Bearing Liabilities:
Deposits:
Interest Bearing Transaction Deposits		$	683,034		$	5,918		3.48	%	$	461,372		$	2,780		2.44	%	$	552,502		$	694		0.50	%
Savings and Money Market Deposits			861,947			7,048		3.28			1,044,794			6,499		2.52			925,354			1,185		0.51
Time Deposits			269,439			1,702		2.53			248,174			1,069		1.75			280,645			665		0.95
Brokered Deposits			896,989			8,330		3.72			743,465			6,026		3.29			403,931			912		0.91
Total Interest Bearing Deposits			2,711,409			22,998		3.40			2,497,805			16,374		2.66			2,162,432			3,456		0.64
Federal Funds Purchased			210,677			2,761		5.26			415,111			4,944		4.83			137,379			410		1.20
Notes Payable			13,750			285		8.33			13,750			263		7.77			—			—		—
FHLB Advances			242,714			2,092		3.46			128,222			861		2.72			47,511			167		1.41
Subordinated Debentures			79,041			993		5.04			78,945			983		5.05			92,396			1,219		5.29
Total Interest Bearing Liabilities			3,257,591			29,129		3.59	%		3,133,833			23,425		3.03	%		2,439,718			5,252		0.86	%
Noninterest Bearing Liabilities:
Noninterest Bearing Transaction Deposits			755,040								813,598								882,477
Other Noninterest Bearing Liabilities			64,684								54,270								39,932
Total Noninterest Bearing Liabilities			819,724								867,868								922,409
Shareholders' Equity			406,347								403,533								381,448
Total Liabilities and Shareholders' Equity		$	4,483,662							$	4,405,234							$	3,743,575
Net Interest Income / Interest Rate Spread						26,280		1.47	%					28,947		1.88	%					32,806		3.30	%
Net Interest Margin ^(3)^								2.40	%							2.72	%							3.58	%
Taxable Equivalent Adjustment:
Tax-Exempt Investment Securities and Loans						(408)								(380)								(276)
Net Interest Income					$	25,872							$	28,567							$	32,530

(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.
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(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.
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Page 6 of 17

Provision for Credit Losses

The provision for credit losses on loans was $550,000 for the second quarter of 2023, compared to $1.5 million for the first quarter of 2023 and $3.0 million for the second quarter of 2022. The provision recorded in the second quarter of 2023 was primarily attributable to the growth of the loan portfolio. The allowance for credit losses on loans to total loans was 1.36% at June 30, 2023 and March 31, 2023, compared to 1.39% at June 30, 2022.

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


		Three Months Ended									Six Months Ended
		June 30,			March 31,			June 30,			June 30,			June 30,
(dollars in thousands)	****	2023		****	2023		****	2022		****	2023		****	2022
Balance at Beginning of Period		$	50,148		$	47,996		$	41,692		$	47,996		$	40,020
Impact of Adopting CECL			—			650			—			650			—
Provision for Credit Losses			550			1,500			3,025			2,050			4,700
Charge-offs			(3)			(4)			(14)			(7)			(29)
Recoveries			6			6			8			12			20
Balance at End of Period		$	50,701		$	50,148		$	44,711		$	50,701		$	44,711

The provision for credit losses for off-balance sheet credit exposures was a negative provision of $500,000 for the second quarter of 2023, compared to a negative $875,000 for the first quarter of 2023 and zero for the second quarter of 2022. The negative provision during the quarter was due to a reduction in outstanding unfunded commitments primarily attributable to the migration to funded loans.

The following table presents a summary of the activity in the provision for credit losses for the periods indicated:


	Three Months Ended									Six Months Ended
	June 30,			March 31,			June 30,			June 30,			June 30,
(dollars in thousands)	2023		****	2023		****	2022		****	2023		****	2022
Provision for Credit Losses on Loans	$	550		$	1,500		$	3,025		$	2,050		$	4,700
Provision for Credit Losses for Off-Balance Sheet Credit Exposures		(500)			(875)			—			(1,375)			—
Provision for Credit Losses	$	50		$	625		$	3,025		$	675		$	4,700

Noninterest Income

Noninterest income was $1.4 million for the second quarter of 2023, a decrease of $528,000 from $1.9 million for the first quarter of 2023, and a decrease of $235,000 from $1.7 million for the second quarter of 2022. The linked-quarter decrease was primarily due to a decrease in letter of credit fees and FHLB prepayment income. The year-over-year decrease was primarily due to decreased letter of credit fees and other income, offset partially by an increase in customer service fees and bank-owned life insurance 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)	2023		****	2023		****	2022		****	2023		****	2022
Noninterest Income:
Customer Service Fees	$	368		$	349		$	298		$	717		$	579
Net Gain (Loss) on Sales of Securities		50			(56)			52			(6)			52
Letter of Credit Fees		379			634			564			1,013			806
Debit Card Interchange Fees		155			138			152			293			285
Swap Fees		—			—			—			—			557
Bank-Owned Life Insurance		238			234			149			472			297
FHLB Prepayment Income		—			299			—			299			—
Other Income		225			345			435			570			631
Totals	$	1,415		$	1,943		$	1,650		$	3,358		$	3,207

Page 7 of 17

Noninterest Expense

Noninterest expense was $14.4 million for the second quarter of 2023, an increase of $205,000 from $14.2 million for the first quarter of 2023, and an increase of $636,000 from $13.8 million for the second quarter of 2022. The linked-quarter increase was primarily due to industry-wide increases in the FDIC insurance assessment, offset partially by a decrease in salaries and employee benefits resulting from lower discretionary incentive accruals and a decrease in occupancy and equipment. The year-over-year increase was primarily attributable to increases in the FDIC insurance assessment and derivative collateral fees, offset partially by decreases in salaries and employee benefits and marketing and advertising.

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)	2023		****	2023		****	2022		****	2023		****	2022
Noninterest Expense:
Salaries and Employee Benefits	$	8,589		$	8,815		$	8,977		$	17,404		$	17,671
Occupancy and Equipment		1,075			1,209			1,042			2,284			2,127
FDIC Insurance Assessment		900			665			330			1,565			690
Data Processing		401			357			356			758			653
Professional and Consulting Fees		829			755			742			1,584			1,436
Derivative Collateral Fees		404			380			27			784			29
Information Technology and Telecommunications		711			683			594			1,394			1,172
Marketing and Advertising		321			262			524			583			1,150
Intangible Asset Amortization		34			48			47			82			95
Amortization of Tax Credit Investments		114			114			63			228			180
Other Expense		1,010			895			1,050			1,905			2,057
Totals	$	14,388		$	14,183		$	13,752		$	28,571		$	27,260

The Company had 253 full-time equivalent employees at June 30, 2023, compared to 246 employees at March 31, 2023, and 236 employees at June 30, 2022. The efficiency ratio, a non-GAAP financial measure, was 52.7% for the second quarter of 2023, compared to 46.2% for the first quarter of 2023, and 40.2% for the second quarter of 2022.

Income Taxes

The effective combined federal and state income tax rate for the second quarter of 2023 was 23.6%, a decrease from 25.9% for the first quarter of 2023, and 26.0% for the second quarter of 2022.

Balance Sheet

Total assets at June 30, 2023 and March 31, 2023 were $4.60 billion, an 18.5% increase from $3.88 billion at June 30, 2022. The year-over-year increase in total assets was primarily due to strong loan growth, purchases of investment securities, and an increase in cash and cash equivalent balances.

Total gross loans at June 30, 2023 were $3.74 billion, an increase of $51.9 million, or 5.6% annualized, over total gross loans of $3.68 billion at March 31, 2023, and an increase of $510.3 million, or 15.8%, over total gross loans of $3.23 billion at June 30, 2022. The increase in the loan portfolio during the second quarter of 2023 was primarily due to the funding of existing construction and land development loans and growth in the 1-4 family mortgage segment, offset partially by a decrease in the 1-4 family construction segment.

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, 2023		March 31, 2023		December 31, 2022		September 30, 2022		June 30, 2022
(dollars in thousands)
Commercial	$	459,184	$	454,193	$	435,344	$	412,448	$	403,569
Paycheck Protection Program		877		963		1,049		1,192		4,860
Construction and Land Development		351,069		312,277		295,554		280,380		305,552
1 - 4 Family Construction		69,648		85,797		70,242		55,177		53,639
Real Estate Mortgage:
1 - 4 Family Mortgage		400,708		380,210		355,474		341,102		334,815
Multifamily		1,314,524		1,320,081		1,306,738		1,230,509		1,087,865
CRE Owner Occupied		159,088		158,650		149,905		151,088		142,214
CRE Nonowner Occupied		971,532		962,671		947,008		900,691		886,432
Total Real Estate Mortgage Loans		2,845,852		2,821,612		2,759,125		2,623,390		2,451,326
Consumer and Other		9,581		9,518		8,132		7,495		6,939
Total Loans, Gross		3,736,211		3,684,360		3,569,446		3,380,082		3,225,885
Allowance for Loan Losses		(50,701)		(50,148)		(47,996)		(46,491)		(44,711)
Net Deferred Loan Fees		(7,718)		(8,735)		(9,293)		(9,088)		(9,536)
Total Loans, Net	$	3,677,792	$	3,625,477	$	3,512,157	$	3,324,503	$	3,171,638

Total deposits at June 30, 2023 were $3.58 billion, an increase of $166.8 million, or 19.6% annualized, over total deposits of $3.41 billion at March 31, 2023, and an increase of $376.0 million, or 11.7%, over total deposits of $3.20 billion at June 30, 2022. Deposits increased in the second quarter of 2023 primarily due to inflows of core deposits, defined as deposits excluding brokered deposits and time deposits greater than $250,000, and brokered deposits. Brokered deposits continue to be used as a supplemental funding source, as needed, to support continued loan portfolio growth. Uninsured deposits as of June 30, 2023 were 22% of total deposits, down from 24% as of March 31, 2023.

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


		June 30, 2023		March 31, 2023		December 31, 2022		September 30, 2022		June 30, 2022
(dollars in thousands)	****
Noninterest Bearing Transaction Deposits		$	751,217	$	742,198	$	884,272	$	961,084	$	961,998
Interest Bearing Transaction Deposits			719,488		630,037		451,992		510,396		522,151
Savings and Money Market Deposits			860,613		913,013		1,031,873		1,077,333		952,138
Time Deposits			271,783		266,213		272,253		293,052		272,424
Brokered Deposits			974,831		859,662		776,153		463,209		493,242
Total Deposits		$	3,577,932	$	3,411,123	$	3,416,543	$	3,305,074	$	3,201,953

Capital

Total shareholders’ equity at June 30, 2023 was $409.1 million, an increase of $7.1 million, or 1.8%, compared to total shareholders’ equity of $402.0 million at March 31, 2023, and an increase of $34.2 million, or 9.1%, over total shareholders’ equity of $374.9 million at June 30, 2022. The linked-quarter increase was due to net income retained and unrealized gains in the derivatives portfolio, offset partially by an increase in unrealized losses in the securities portfolio and preferred stock dividends. The year-over-year increase was due to net income retained and unrealized gains in the derivatives portfolio, offset partially by an increase in unrealized losses in the securities portfolio, stock repurchases, the adoption of the Current Expected Credit Losses (CECL) accounting methodology and preferred stock dividends. The Company did not purchase any shares of its common stock during the second quarter of 2023.

Tangible book value per share, a non-GAAP financial measure, was $12.15 as of June 30, 2023, an increase of 1.7% from $11.95 as of March 31, 2023, and an increase of 10.1% from $11.03 as of June 30, 2022. The linked-quarter and year-over-year increases occurred despite the market value depreciation of the securities portfolio driven by the rising interest rate environment. Tangible common equity as a percentage of tangible assets, a non-GAAP financial measure, was 7.39% at June 30, 2023, compared to 7.23% at March 31, 2023, and 7.87% at June 30, 2022.

Today, the Company also announced that its Board of Directors has declared a quarterly cash dividend on its 5.875% Non-Cumulative Perpetual Preferred Stock, Series A (Series A Preferred Stock). The quarterly cash dividend of $36.72 per share, equivalent to $0.3672 per depositary share, each representing a 1/100th interest in a share of the Series A Preferred Stock (Nasdaq: BWBBP), is payable on September 1, 2023 to shareholders of record of the Series A Preferred Stock at the close of business on August 15, 2023.

Page 9 of 17

Liquidity

Total on- and off-balance sheet liquidity was $1.96 billion as of June 30, 2023, compared to $1.92 billion at March 31, 2023 and $1.53 billion at June 30, 2022. The Company did not utilize the Bank Term Funding Program (BTFP) or Federal Reserve Discount Window during the second quarter of 2023.


Primary Liquidity—On-Balance Sheet	****	June 30, 2023		****	March 31, 2023		****	December 31, 2022		****	September 30, 2022			June 30, 2022
(dollars in thousands)										****
Cash and Cash Equivalents		$	138,618		$	177,116		$	48,090		$	36,332		$	43,168
Securities Available for Sale			538,220			559,430			548,613			542,007			482,583
Less: Pledged Securities			(236,206)			(234,452)			—			—			—
Total Primary Liquidity		$	440,632		$	502,094		$	596,703		$	578,339		$	525,751
Ratio of Primary Liquidity to Total Deposits			12.3	%		14.7	%		17.5	%		17.5	%		16.4	%

Secondary Liquidity—Off-Balance Sheet										****
Borrowing Capacity	****									****
Net Secured Borrowing Capacity with the FHLB		$	400,792		$	246,795		$	390,898		$	426,604		$	569,076
Net Secured Borrowing Capacity with the Federal Reserve Bank			986,644			990,685			157,827			156,534			169,766
Unsecured Borrowing Capacity with Correspondent Lenders			108,000			158,000			208,000			208,000			208,000
Secured Borrowing Capacity with Correspondent Lender			26,250			26,250			26,250			40,000			25,000
Total Secondary Liquidity			1,521,686			1,421,730			782,975			831,138			971,842
Total Primary and Secondary Liquidity		$	1,962,318		$	1,923,824		$	1,379,678		$	1,409,477		$	1,497,593
Ratio of Primary and Secondary Liquidity to Total Deposits			54.8	%		56.4	%		40.4	%		42.6	%		46.8	%

Asset Quality

Annualized net charge-offs (recoveries) as a percentage of average loans were 0.00% for the second quarter of 2023, first quarter of 2023 and second quarter of 2022. At June 30, 2023, the Company’s nonperforming assets, which include nonaccrual loans, loans past due 90 days and still accruing, and foreclosed assets, were $778,000, or 0.02% of total assets, as compared to $809,000, or 0.02% of total assets at March 31, 2023, and $688,000, or 0.02% of total assets at June 30, 2022.

Loans that have potential weaknesses that warrant a watchlist risk rating at June 30, 2023 totaled $27.2 million, compared to $27.6 million at March 31, 2023, and $34.7 million at June 30, 2022. Loans that warranted a substandard risk rating at June 30, 2023 totaled $33.8 million, compared to $36.3 million at March 31, 2023, and $27.0 million at June 30, 2022. The linked-quarter decrease was primarily due to the upgrade of one loan relationship; however, increased uncertainty in the economic environment may result in future watchlist or adverse classifications in the loan portfolio.

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)	****	2023		****	2023		****	2022		****	2022		****	2022		****
Selected Asset Quality Data
Loans 30-89 Days Past Due		$	—		$	21		$	186		$	38		$	225
Loans 30-89 Days Past Due to Total Loans			0.00	%		0.00	%		0.01	%		0.00	%		0.01	%
Nonperforming Loans		$	662		$	693		$	639		$	663		$	688
Nonperforming Loans to Total Loans			0.02	%		0.02	%		0.02	%		0.02	%		0.02	%
Foreclosed Assets		$	116		$	116		$	—		$	—		$	—
Nonaccrual Loans to Total Loans			0.02	%		0.02	%		0.02	%		0.02	%		0.02	%
Nonaccrual Loans and Loans Past Due 90 Days and Still Accruing to Total Loans			0.02			0.02			0.02			0.02			0.02
Nonperforming Assets ^(1)^		$	778		$	809		$	639		$	663		$	688
Nonperforming Assets to Total Assets ^(1)^			0.02	%		0.02	%		0.01	%		0.02	%		0.02	%
Allowance for Credit Losses to Total Loans			1.36			1.36			1.34			1.38			1.39
Allowance for Credit Losses to Nonaccrual Loans			7,658.76			7,236.36			7,511.11			7,012.22			6,498.69
Net Loan Charge-Offs (Recoveries) (Annualized) to Average Loans			0.00			0.00			0.00			(0.03)			0.00

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

Page 10 of 17

The Company will host a conference call to discuss its second quarter 2023 financial results on Thursday, July 27, 2023 at 8:00 a.m. Central Time. The conference call can be accessed by dialing 844-481-2913 and requesting to join the Bridgewater Bancshares earnings call. To listen to a replay of the conference call via phone, please dial 877-344-7529 and enter access code 5127957. The replay will be available through August 3, 2023. The conference call will also be available via a live webcast on the Investor Relations section of the Company’s website, investors.bridgewaterbankmn.com, and archived for replay.

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 successful 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 $4.6 billion and seven branches as of June 30, 2023, 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.

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: interest rate risk, including the effects of recent and anticipated rate increases by the Federal Reserve; fluctuations in the values of the securities held in our securities portfolio, including as the result of rising interest rates, which has resulted in unrealized losses in our portfolio; business and economic conditions generally and in the financial services industry, nationally and within our market area, including rising rates of inflation and possible recession; the effects of recent developments and events in the financial services industry, including the large-scale deposit withdrawals over a short period of time at Silicon Valley Bank and Signature Bank that resulted in the failure of those institutions; loan concentrations in our portfolio; the overall health of the local and national real estate market; our ability to successfully manage credit risk; our ability to maintain an adequate level of allowance for loan losses; new or revised accounting standards, including as a result of the implementation of the Current Expected Credit Loss standard; the concentration of large loans to certain borrowers; the concentration of large deposits from certain clients, who have balances above current FDIC insurance limits and may withdraw deposits to diversify their exposure; our ability to successfully manage liquidity risk, which may increase our dependence on non-core funding sources such as brokered deposits, and negatively impact 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 expected discontinuation of 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; talent and labor shortages and high rates of employee turnover; 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, including from nonbank competitors such as credit unions and “fintech” companies; the effectiveness of our risk management framework; the commencement and outcome of litigation and other legal proceedings and regulatory actions against us;

Page 11 of 17

the impact of recent and future legislative and regulatory changes, including in response to the recent failures of Silicon Valley Bank and Signature Bank; risks related to climate change and the negative impact it may have on our customers and their businesses; 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 including the Russian invasion of Ukraine; potential impairment to the goodwill the Company recorded in connection with our past acquisition; changes to U.S. or state tax laws, regulations and guidance, including the new 1% excise tax on stock buybacks by publicly traded companies; 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. The Company undertakes 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 12 of 17

Bridgewater Bancshares, Inc. and Subsidiaries Consolidated Balance Sheets

(dollars in thousands, except share data)


		June 30,			December 31,			June 30,
	****	2023		****	2022		****	2022
		(Unaudited)						(Unaudited)
ASSETS
Cash and Cash Equivalents		$	177,101		$	87,043		$	73,517
Bank-Owned Certificates of Deposit			1,225			1,181			1,138
Securities Available for Sale, at Fair Value			538,220			548,613			482,583
Loans, Net of Allowance for Credit Losses of $50,701 at June 30, 2023 (unaudited), $47,996 at December 31, 2022 and $44,711 at June 30, 2022 (unaudited)			3,677,792			3,512,157			3,171,638
Federal Home Loan Bank (FHLB) Stock, at Cost			21,557			19,606			9,921
Premises and Equipment, Net			49,710			48,445			49,294
Foreclosed Assets			116			—			—
Accrued Interest			13,822			13,479			10,010
Goodwill			2,626			2,626			2,626
Other Intangible Assets, Net			206			288			383
Bank-Owned Life Insurance			33,958			33,485			25,614
Other Assets			86,852			78,739			56,540
Total Assets		$	4,603,185		$	4,345,662		$	3,883,264

LIABILITIES AND EQUITY
LIABILITIES
Deposits:
Noninterest Bearing		$	751,217		$	884,272		$	961,998
Interest Bearing			2,826,715			2,532,271			2,239,955
Total Deposits			3,577,932			3,416,543			3,201,953
Federal Funds Purchased			195,000			287,000			86,000
Notes Payable			13,750			13,750			—
FHLB Advances			262,000			97,000			56,500
Subordinated Debentures, Net of Issuance Costs			79,096			78,905			92,459
Accrued Interest Payable			2,974			2,831			1,393
Other Liabilities			63,307			55,569			70,076
Total Liabilities			4,194,059			3,951,598			3,508,381

SHAREHOLDERS' EQUITY
Preferred Stock- $0.01 par value; Authorized 10,000,000
Preferred Stock - Issued and Outstanding 27,600 Series A shares ($2,500 liquidation preference) at June 30, 2023 (unaudited), December 31, 2022, and June 30, 2022 (unaudited)			66,514			66,514			66,514
Common Stock- $0.01 par value; Authorized 75,000,000
Common Stock - Issued and Outstanding 27,973,995 at June 30, 2023 (unaudited), 27,751,950 at December 31, 2022 and 27,677,372 at June 30, 2022 (unaudited)			280			278			277
Additional Paid-In Capital			99,044			96,529			96,689
Retained Earnings			264,196			248,685			222,464
Accumulated Other Comprehensive Loss			(20,908)			(17,942)			(11,061)
Total Shareholders' Equity			409,126			394,064			374,883
Total Liabilities and Equity		$	4,603,185		$	4,345,662		$	3,883,264

Page 13 of 17

Bridgewater Bancshares, Inc. and Subsidiaries Consolidated Statements of Income

(dollars in thousands, except per share data)

(Unaudited)


		Three Months Ended									Six Months Ended
		June 30,			March 31,			June 30,			June 30,			June 30,
	****	2023		****	2023		****	2022		****	2023		****	2022
INTEREST INCOME
Loans, Including Fees		$	47,721		$	44,955		$	34,358		$	92,676		$	66,102
Investment Securities			6,237			6,218			3,325			12,455			6,195
Other			1,043			819			99			1,862			179
Total Interest Income			55,001			51,992			37,782			106,993			72,476

INTEREST EXPENSE
Deposits			22,998			16,374			3,456			39,372			6,614
Notes Payable			285			263			—			548			—
FHLB Advances			2,092			861			167			2,953			317
Subordinated Debentures			993			983			1,219			1,976			2,416
Federal Funds Purchased			2,761			4,944			410			7,705			419
Total Interest Expense			29,129			23,425			5,252			52,554			9,766

NET INTEREST INCOME			25,872			28,567			32,530			54,439			62,710
Provision for Credit Losses			50			625			3,025			675			4,700

NET INTEREST INCOME AFTER
PROVISION FOR CREDIT LOSSES			25,822			27,942			29,505			53,764			58,010

NONINTEREST INCOME
Customer Service Fees			368			349			298			717			579
Net Gain (Loss) on Sales of Available for Sale Securities			50			(56)			52			(6)			52
Other Income			997			1,650			1,300			2,647			2,576
Total Noninterest Income			1,415			1,943			1,650			3,358			3,207

NONINTEREST EXPENSE
Salaries and Employee Benefits			8,589			8,815			8,977			17,404			17,671
Occupancy and Equipment			1,075			1,209			1,042			2,284			2,127
Other Expense			4,724			4,159			3,733			8,883			7,462
Total Noninterest Expense			14,388			14,183			13,752			28,571			27,260

INCOME BEFORE INCOME TAXES			12,849			15,702			17,403			28,551			33,957
Provision for Income Taxes			3,033			4,060			4,521			7,093			8,813
NET INCOME			9,816			11,642			12,882			21,458			25,144
Preferred Stock Dividends			(1,014)			(1,013)			(1,014)			(2,027)			(2,027)
NET INCOME AVAILABLE TO COMMON SHAREHOLDERS		$	8,802		$	10,629		$	11,868		$	19,431		$	23,117

EARNINGS PER SHARE
Basic		$	0.32		$	0.38		$	0.43		$	0.70		$	0.83
Diluted			0.31			0.37			0.41			0.69			0.80

Page 14 of 17

Bridgewater Bancshares, Inc. and Subsidiaries Analysis of Average Balances, Yields and Rates

(dollars in thousands, except per share data)

(Unaudited)


		For the Six Months Ended															****
		June 30, 2023								June 30, 2022							****
		Average			Interest			Yield/		Average			Interest			Yield/
	****	Balance		****	& Fees		****	Rate	****	Balance		****	& Fees		****	Rate	****
(dollars in thousands)
Interest Earning Assets:
Cash Investments		$	61,599		$	1,034		3.38	%	$	70,718		$	66		0.19	%
Investment Securities:
Taxable Investment Securities			571,176			11,958		4.22			395,203			4,951		2.53
Tax-Exempt Investment Securities^(1)^			28,435			629		4.46			72,933			1,574		4.35
Total Investment Securities			599,611			12,587		4.23			468,136			6,525		2.81
Paycheck Protection Program Loans ^(2)^			956			5		1.00			13,210			826		12.61
Loans ^(1)(2)^			3,672,772			93,327		5.12			2,991,195			65,480		4.41
Total Loans			3,673,728			93,332		5.12			3,004,405			66,306		4.45
Federal Home Loan Bank Stock			24,639			828		6.77			8,667			113		2.63
Total Interest Earning Assets			4,359,577			107,781		4.99	%		3,551,926			73,010		4.15	%
Noninterest Earning Assets			85,087								77,395
Total Assets		$	4,444,664							$	3,629,321
Interest Bearing Liabilities:
Deposits:
Interest Bearing Transaction Deposits		$	570,964		$	8,698		3.07	%	$	559,352		$	1,291		0.47	%
Savings and Money Market Deposits			952,865			13,547		2.87			901,102			2,103		0.47
Time Deposits			258,865			2,771		2.16			284,757			1,410		1.00
Brokered Deposits			820,651			14,356		3.53			405,282			1,810		0.90
Total Interest Bearing Deposits			2,603,345			39,372		3.05			2,150,493			6,614		0.62
Federal Funds Purchased			312,329			7,705		4.97			74,340			419		1.14
Notes Payable			13,750			548		8.03			—			—		—
FHLB Advances			185,785			2,953		3.21			45,019			317		1.42
Subordinated Debentures			78,994			1,976		5.05			92,341			2,416		5.28
Total Interest Bearing Liabilities			3,194,203			52,554		3.32	%		2,362,193			9,766		0.83	%
Noninterest Bearing Liabilities:
Noninterest Bearing Transaction Deposits			786,009								852,648
Other Noninterest Bearing Liabilities			59,504								32,248
Total Noninterest Bearing Liabilities			845,513								884,896
Shareholders' Equity			404,948								382,232
Total Liabilities and Shareholders' Equity		$	4,444,664							$	3,629,321
Net Interest Income / Interest Rate Spread						55,227		1.67	%					63,244		3.32	%
Net Interest Margin ^(3)^								2.55	%							3.59	%
Taxable Equivalent Adjustment:
Tax-Exempt Investment Securities and Loans						(788)								(534)
Net Interest Income					$	54,439							$	62,710

(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 15 of 17

Bridgewater Bancshares, Inc. and Subsidiaries 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,
	****	2023		****	2023			2022			2023		****	2022		****
Pre-Provision Net Revenue
Noninterest Income		$	1,415		$	1,943		$	1,650		$	3,358		$	3,207
Less: (Gain) Loss on Sales of Securities			(50)			56			(52)			6			(52)
Less: FHLB Advance Prepayment Income			—			(299)			—			(299)			—
Total Operating Noninterest Income			1,365			1,700			1,598			3,065			3,155
Plus: Net Interest Income			25,872			28,567			32,530			54,439			62,710
Net Operating Revenue		$	27,237		$	30,267		$	34,128		$	57,504		$	65,865

Noninterest Expense		$	14,388		$	14,183		$	13,752		$	28,571		$	27,260
Less: Amortization of Tax Credit Investments			(114)			(114)			(63)			(228)			(180)
Total Operating Noninterest Expense		$	14,274		$	14,069		$	13,689		$	28,343		$	27,080

Pre-Provision Net Revenue		$	12,963		$	16,198		$	20,439		$	29,161		$	38,785

Plus:
Non-Operating Revenue Adjustments			50			243			52			293			52
Less:
Provision for Credit Losses			50			625			3,025			675			4,700
Non-Operating Expense Adjustments			114			114			63			228			180
Provision for Income Taxes			3,033			4,060			4,521			7,093			8,813
Net Income		$	9,816		$	11,642		$	12,882		$	21,458		$	25,144

Average Assets		$	4,483,662		$	4,405,234		$	3,743,575		$	4,444,664		$	3,629,321
Pre-Provision Net Revenue Return on Average Assets			1.16	%		1.49	%		2.19	%		1.32	%		2.16	%


		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,
	****	2023		****	2023		****	2022		****	****	2023		****	2022		****
Core Net Interest Margin
Net Interest Income (Tax-Equivalent Basis)		$	26,280		$	28,947		$	32,806			$	55,227		$	63,244
Less: Loan Fees			(941)			(998)			(2,030)				(1,939)			(3,773)
Less: PPP Interest and Fees			(3)			(2)			(263)				(5)			(826)
Core Net Interest Income		$	25,336		$	27,947		$	30,513			$	53,283		$	58,645

Average Interest Earning Assets		$	4,395,050		$	4,323,706		$	3,671,748			$	4,359,576		$	3,551,926
Less: Average PPP Loans			(913)			(999)			(8,335)				(956)			(13,210)
Core Average Interest Earning Assets		$	4,394,137		$	4,322,707		$	3,663,413			$	4,358,620		$	3,538,716
Core Net Interest Margin			2.31	%		2.62	%		3.34	%			2.47	%		3.34	%

Page 16 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,
	****	2023		****	2023		****	2022		****	****	2023		****	2022		****
Efficiency Ratio
Noninterest Expense		$	14,388		$	14,183		$	13,752			$	28,571		$	27,260
Less: Amortization of Intangible Assets			(34)			(48)			(47)				(82)			(95)
Adjusted Noninterest Expense		$	14,354		$	14,135		$	13,705			$	28,489		$	27,165
Net Interest Income			25,872			28,567			32,530				54,439			62,710
Noninterest Income			1,415			1,943			1,650				3,358			3,207
Less: (Gain) Loss on Sales of Securities			(50)			56			(52)				6			(52)
Adjusted Operating Revenue		$	27,237		$	30,566		$	34,128			$	57,803		$	65,865
Efficiency Ratio			52.7	%		46.2	%		40.2	%			49.3	%		41.2	%


	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,
	2023			2023			2022			2023			2022
Tangible Common Equity and Tangible Common Equity/Tangible Assets
Total Shareholders' Equity	$	409,126		$	402,006		$	374,883
Less: Preferred Stock		(66,514)			(66,514)			(66,514)
Total Common Shareholders' Equity		342,612			335,492			308,369
Less: Intangible Assets		(2,832)			(2,866)			(3,009)
Tangible Common Equity	$	339,780		$	332,626		$	305,360

Total Assets	$	4,603,185		$	4,602,899		$	3,883,264
Less: Intangible Assets		(2,832)			(2,866)			(3,009)
Tangible Assets	$	4,600,353		$	4,600,033		$	3,880,255
Tangible Common Equity/Tangible Assets		7.39	%		7.23	%		7.87	%

Tangible Book Value Per Share
Book Value Per Common Share	$	12.25		$	12.05		$	11.14
Less: Effects of Intangible Assets		(0.10)			(0.10)			(0.11)
Tangible Book Value Per Common Share	$	12.15		$	11.95		$	11.03

Return on Average Tangible Common Equity
Net Income Available to Common Shareholders	$	8,802		$	10,629		$	11,868		$	19,431		$	23,117

Average Shareholders' Equity	$	406,347		$	403,533		$	381,448		$	404,948		$	382,232
Less: Average Preferred Stock		(66,514)			(66,514)			(66,514)			(66,514)			(66,514)
Average Common Equity		339,833			337,019			314,934			338,434			315,718
Less: Effects of Average Intangible Assets		(2,846)			(2,894)			(3,037)			(2,870)			(3,060)
Average Tangible Common Equity	$	336,987		$	334,125		$	311,897		$	335,564		$	312,658
Return on Average Tangible Common Equity		10.48	%		12.90	%		15.26	%		11.68	%		14.91	%


	Three Months Ended
	June 30,		March 31,		December 31,		September 30,		June 30,
	2023		2023		2022		2022		2022
Tangible Common Equity
Total Shareholders' Equity	$	409,126	$	402,006	$	394,064	$	382,007	$	374,883
Less: Preferred Stock		(66,514)		(66,514)		(66,514)		(66,514)		(66,514)
Common Shareholders' Equity		342,612		335,492		327,550		315,493		308,369
Less: Intangible Assets		(2,832)		(2,866)		(2,914)		(2,962)		(3,009)
Tangible Common Equity	$	339,780	$	332,626	$	324,636	$	312,531	$	305,360

Page 17 of 17

Exhibit 99.2

Disclaimer<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 statements include, without limitation, statements<br>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”,<br>“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<br>words of a future or forward-looking nature.<br>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,<br>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<br>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 forward-looking statements. Therefore, you should not rely on any of these<br>forward-looking statements. Important factors that could cause our actual results and financial condition to differ materially from those indicated in forward-looking statements include, among others, the following: interest rate risk,<br>including the effects of recent and anticipated rate increases by the Federal Reserve; fluctuations in the values of the securities held in our securities portfolio or the values of derivative instruments held in our derivatives portfolio,<br>including as a result of changes in interest rates; business and economic conditions generally and in the financial services industry, nationally and within our market area, including rising rates of inflation and possible recession; the<br>effects of recent developments and events in the financial services industry, including the large-scale deposit withdrawals over a short period of time at Silicon Valley Bank, Signature Bank and First Republic Bank that resulted in the<br>failure of those institutions; loan concentrations in our portfolio; the overall health of the local and national real estate market; our ability to successfully manage credit risk; our ability to maintain an adequate level of allowance for loan<br>losses; new or revised accounting standards, including as a result of the implementation of the Current Expected Credit Loss standard; the concentration of large loans to certain borrowers; the concentration of large deposits from<br>certain clients, who have balances above the current Federal Deposit Insurance Corporation insurance limits; our ability to successfully manage liquidity risk, which may increase our dependence on non-core funding sources such as<br>brokered deposits, and negative impact of 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; the composition of our senior<br>leadership team and our ability to attract and retain key personnel; talent and labor shortages an high rates of employment turnover; the occurrence of fraudulent activity, breaches or failures of our information security controls or<br>cybersecurity-related incidents, including as a result of sophisticated attacks using artificial intelligence and similar tools; interruptions involving our information technology and telecommunications systems or third-party servicers;<br>competition in the financial services industry, including from nonbank competitors such as credit unions and “fintech” companies; the effectiveness of our risk management framework; the commencement and outcome of litigation and<br>other legal proceedings and regulatory actions against us; the impact of recent and future legislative and regulatory changes, including in response to the recent failures of Silicon Valley Bank, Signature Bank and First Republic Bank;<br>risks related to climate change and the negatively impact it may have on our customers and their businesses; the imposition of governmental policies impacting the value of products produced by our commercial borrowers; severe<br>weather, natural disasters, wide spread disease or pandemics (including the COVID-19 pandemic), acts of war or terrorism, civil unrest or other adverse external events, including the Russian invasion of Ukraine; potential impairment to<br>the goodwill we recorded in connection with our past acquisition; changes to U.S. or state tax laws, regulations and guidance, including the new 1% excise tax on stock buybacks by publicly traded companies; the success at managing<br>the risks involved in the foregoing items; and any other risks described in the “Risk Factors” sections of reports filed by the Company with the Securities and Exchange Commission.<br>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. The Company undertake no obligation to publicly update any<br>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. Certain of the information contained in this presentation is derived<br>from information provided by industry sources. Although the Company believe that such information is accurate and that the sources from which it has been obtained are reliable, the Company cannot guarantee the accuracy of, and<br>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 non-GAAP financial measures. The Company<br>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<br>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<br>that may be presented by other companies. Reconciliations of non-GAAP disclosures to the comparable GAAP measures are provided in this presentation.<br>2
0.02%<br>2Q23 Earnings Highlights<br>3<br>• Deposit balances up $166.8 million, or 19.6% annualized, from 1Q23<br>• Core deposit2 growth of 7.4% annualized from 1Q23 outpaced loan growth of 5.6% annualized<br>• Borrowings declined $176.9 million, or 24.3%, from 1Q23<br>• Net interest margin (NIM) of 2.40%, down 32 bps from 1Q23<br>• Yield on interest-earning assets of 5.06%, up 15 bps from 1Q23<br>• Cost of deposits of 2.66%, up 65 bps from 1Q23<br>• Month-over-month core net interest margin compression slowed throughout 2Q23<br>• Noninterest expense up $0.2 million, or 1.4%, from 1Q23 and up $0.6 million, or 4.6%, from 2Q22<br>• Noninterest expense to average assets of 1.29% annualized, down 2 bps from 1Q23<br>• Efficiency ratio1 of 52.7%, up from 46.2% in 1Q23<br>• Annualized net charge-offs to average loans of 0.00%, in-line with 1Q23<br>• Nonperforming assets to total assets of 0.02%, in-line with 1Q23<br>• Growth-driven provision of $550 thousand; allowance to total loans of 1.36%<br>Improving Balance<br>Sheet Composition<br>Net Interest Margin<br>Pressure Slowing<br>Well-Controlled<br>Expenses<br>Superb<br>Asset Quality<br>$0.31<br>Diluted<br>EPS<br>Nonperforming Assets<br>to Total Assets<br>Efficiency<br>Ratio1<br>Return on<br>Average Assets<br>Return on Avg. Tangible<br>Common Equity1<br>0.88% 10.48% 52.7%<br>1 Represents a Non-GAAP financial measure. See Appendix for Non-GAAP reconciliation<br>2 Core deposits are defined as total deposits less brokered deposits and certificates of deposit greater than $250,000
---
Net Interest Income Impacted by Margin<br>Pressure and Managed Loan Growth<br>4<br>$30,237 $32,599 $31,745<br>$27,567<br>$24,928<br>$263<br>$96 $48<br>$2<br>$3<br>$2,030<br>$1,400 $1,100<br>$998<br>$941<br>$32,530<br>$34,095 $32,893<br>$28,567<br>$25,872<br>3.58% 3.53%<br>3.16%<br>2.72%<br>3.34% 3.38% 2.40%<br>3.05%<br>2.62%<br>2.31%<br>2Q22 3Q22 4Q22 1Q23 2Q23<br>Core Net Interest Margin1,2<br>Net Interest Margin1<br>Net Interest Income (ex. interest income<br>on loan fees and PPP loans)<br>Interest Income and fees on PPP loans<br>Loan fees<br>Net Interest Income and Margin Trends Net Interest Margin Drivers<br>Core NIM2 down 31 bps<br>Month-Over-Month Core NIM Compression Slowed in 2023<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,<br>see Appendix for Non-GAAP reconciliation<br>Dollars in thousands<br>1<br>6<br>13<br>16<br>14 14 15 14<br>10<br>7 6<br>Aug.<br>22<br>Sep.<br>22<br>Oct.<br>22<br>Nov.<br>22<br>Dec.<br>22<br>Jan.<br>23<br>Feb.<br>23<br>Mar.<br>23<br>Apr.<br>23<br>May<br>23<br>Jun.<br>23<br>Core NIM1 Compression by Month (bps)<br>• June 2023 NIM of 2.33%<br>compared to 2Q23 NIM<br>of 2.40%<br>• Core NIM pressure<br>slowed during 2Q23<br>after 6 consecutive<br>months of steady<br>compression
---
Funding Costs Outpacing Asset Yields<br>5<br>$2,162 $2,253 $2,332 $2,498 $2,711<br>$882<br>$277<br>$992 $943 $814 $755 $272 $527 $636 $546 $3,321 $3,517 $3,802 $3,948 $4,012<br>0.63% 0.93%<br>1.67%<br>2.41%<br>2.91%<br>2Q22 3Q22 4Q22 1Q23 2Q23<br>$3,108 $3,266 $3,482 $3,630 $3,717<br>4.45% 4.59%<br>4.87%<br>5.06% 5.19%<br>4.17% 4.42%<br>4.74%<br>4.95% 5.09%<br>2Q22 3Q22 4Q22 1Q23 2Q23<br>$3,045<br>$3,245 $3,275 $3,311 $3,466 0.46% 0.73%<br>1.31%<br>2.01%<br>2.66%<br>2Q22 3Q22 4Q22 1Q23 2Q23<br>Loan Yield (ex. Loan Fees and PPP)2<br>Loan Portfolio Steadily Repricing Higher High-Yielding Securities Portfolio<br>Deposit Costs Continue to Rise Overall Funding Costs Continue to Rise<br>$491 $537<br>$608 $604 $595<br>2.85%<br>3.35%<br>3.91% 4.22% 4.24%<br>2Q22 3Q22 4Q22 1Q23 2Q23<br>Average Interest-Bearing Deposits Average Noninterest-Bearing Deposits<br>Average Borrowings Cost of Liability Funding<br>Average Loans Loan Yield1 Average Investments Investment Yield1<br>Average Total Deposits Cost of Total Deposits<br>1 Amounts calculated on a tax-equivalent basis using statutory federal tax rate of 21%<br>2 Represents a Non-GAAP financial measure. See Appendix for Non-GAAP reconciliation<br>Dollars in millions
---
Revenue Trends Impacted by<br>Current Environment<br>6<br>PPNR ROA1<br>Continued Profitability in the Current Environment Spread-Based Revenue Model<br>$32,530 $34,095 $32,893<br>$28,567<br>$25,872<br>$1,650<br>$1,387 $1,738<br>$1,943<br>$1,415<br>$34,180<br>$35,482 $34,631<br>$30,510<br>$27,287<br>2Q22 3Q22 4Q22 1Q23 2Q23<br>$20,439<br>$21,439<br>$19,512<br>$16,198<br>$12,882 $12,963<br>$14,513 $13,735<br>$11,642<br>$9,816<br>2.19% 2.15%<br>1.82%<br>1.49%<br>1.16%<br>1.38% 1.46%<br>1.28%<br>1.07%<br>0.88%<br>2Q22 3Q22 4Q22 1Q23 2Q23<br>PPNR Net Income 1 ROA Net Interest Income Noninterest Income<br>1 Represents a Non-GAAP financial measure. See Appendix for Non-GAAP reconciliation<br>Dollars in thousands
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$8,977 $9,449 $9,821 $8,815 $8,589<br>$1,042 $1,086 $1,177<br>$1,209 $1,075<br>$950 $1,022 $1,044<br>$1,040 $1,112<br>$2,783 $2,600<br>$3,161<br>$3,119 $3,612<br>$13,752 $14,157<br>$15,203<br>$14,183 $14,388<br>2Q22 3Q22 4Q22 1Q23 2Q23<br>Well-Controlled Expenses<br>7<br>1.47% 1.42% 1.42%<br>1.31% 1.29%<br>40.2% 39.8%<br>43.8%<br>46.2%<br>52.7%<br>2Q22 3Q22 4Q22 1Q23 2Q23<br>NIE / Avg. Assets2 Efficiency Ratio2<br>Highly Efficient Business Model Despite Revenue Pressures Well-Controlled Expense Base in the Current Environment<br>Industry median efficiency ratio of 57%1 NIE growth tracking below asset growth YoY<br>Personnel Occupancy<br>Technology Other<br>1 1Q23 median efficiency ratio for publicly-traded banks with total assets between $3 billion and $10 billion (Source: S&P Capital IQ)<br>2 Represents a Non-GAAP financial measure. See Appendix for Non-GAAP reconciliation<br>Dollars in thousands
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Strong Rebound in Deposit Growth<br>8<br>30% 29% 26% 22% 21%<br>16% 15%<br>13% 18% 20%<br>30% 33%<br>30% 27% 24%<br>9%<br>9%<br>8%<br>8% 8%<br>15%<br>14% 23% 25%<br>27%<br>$3,202<br>$3,305<br>$3,417 $3,411<br>$3,578<br>2Q22 3Q22 4Q22 1Q23 2Q23<br>Noninterest-Bearing Transaction Interest-Bearing Transaction<br>Savings & Money Market Time<br>Brokered<br>• Total deposit balances up 19.6% annualized<br>• Core deposit1 balances up 7.4% annualized<br>• Overall mix shift continued from noninterest-bearing into<br>interest-bearing deposits<br>• Continued to supplement core deposits with wholesale<br>funding to support loan growth<br>• Remained focused on better aligning loan growth with core<br>deposit growth over the course of 2023 (2Q23 annualized loan<br>growth of 5.6% vs. core deposit1 growth of 7.4%)<br>• Loan-to-deposit ratio of 104.4%, down from 108.0% in 1Q23<br>• Uninsured deposits remained low at 22%, down from 38% in<br>4Q22<br>Deposit Balances Rise in 2Q23<br>1 Core deposits are defined as total deposits less brokered deposits and certificates of deposit greater than $250,000<br>2 Calculated as the change in ending deposit rate over the change in ending Fed Funds rate from February 2022<br>Dollars in millions<br>Cumulative Total Deposit Beta2<br>12%<br>20%<br>34%<br>40%<br>48%<br>6/30/2022 9/30/2022 12/31/2022 3/31/2023 6/30/2023
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Managed Pace of Loan Growth<br>9<br>$3,226<br>$3,380<br>$3,569<br>$3,684 $3,736<br>2Q22 3Q22 4Q22 1Q23 2Q23<br>Gross Loans<br>Dollars in millions<br>• 2Q23 loan growth of $51.9M, or 5.6% annualized<br>• YTD loan growth of $166.8M, or 9.4% annualized<br>• Strong brand presence and relationships in the market<br>allow us to continue to get in front of high-quality clients<br>and deals<br>• Being more selective by focusing on high quality<br>transactions with seasoned clients<br>• Actively managing the balance sheet to better align with<br>funding outlook<br>• Being more disciplined on loan pricing to manage growth<br>and the net interest margin<br>• Leveraging sales of participations on new originations<br>• Overall loan demand has declined as fewer deals are<br>making financial sense due to the higher interest rate<br>environment<br>Managing Loan Growth
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Well-Diversified Loan Portfolio<br>10 Dollars in millions<br>CRE NOO<br>26.0%<br>Multifamily<br>35.2%<br>C&D<br>11.2%<br>1-4 Family<br>Mortgage<br>10.7%<br>CRE OO<br>4.3% C&I<br>12.3%<br>Consumer<br>& Other<br>0.2%<br>Loan Mix<br>by Type<br>$3.7<br>Billion<br>2Q23 Loan Growth by Type (vs. 1Q23)<br>$(6)<br>$-<br>$-<br>$5<br>$9<br>$20<br>$23<br>Multifamily<br>1-4 Family Mortgage<br>Construction & Development<br>C&I<br>CRE Owner Occupied<br>CRE Nonowner Occupied<br>Consumer & Other<br>• Intentionally slowing the overall pace of loan growth across the portfolio<br>• Construction and development growth primarily due to draws on previously originated loans
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Loan Originations and Payoffs Are Slowing<br>11<br>New Loan Originations and Advances<br>$268<br>$169 $186<br>$75 $47<br>$125<br>$139 $127<br>$145<br>$84<br>$393<br>$308 $313<br>$220<br>$131<br>2Q22 3Q22 4Q22 1Q23 2Q23<br>New Originations Advances<br>Loan Payoffs and Amortization/Paydowns<br>$163<br>$117 $99<br>$69 $54<br>$31<br>$36<br>$42<br>$42<br>$45<br>$194<br>$153 $141<br>$111 $99<br>2Q22 3Q22 4Q22 1Q23 2Q23<br>Payoffs Amortization/Paydowns<br>$311 $373 $427<br>$508 $537<br>2Q22 3Q22 4Q22 1Q23 2Q23<br>Selling Participations on Larger Loans to Manage Growth<br>Loan Participation Portfolio Balance<br>Sold $109M of participations in 2023 YTD<br>Dollars in millions
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¹ Nonaccrual loans plus loans 90 days past due and still accruing and foreclosed assets<br>Dollars in thousands<br>Superb Asset Quality Continues<br>12<br>$6<br>$(280)<br>$(5) $(2) $(3)<br>0.00%<br>(0.03)%<br>0.00% 0.00% 0.00%<br>2Q22 3Q22 4Q22 1Q23 2Q23<br>Net Charge-Offs<br>Cumulative NCOs of $376K since 2017<br>Net Charge-offs (recoveries) % of Average Loans (annualized)<br>$44,711<br>$46,491<br>$47,996<br>$50,148 $50,701<br>1.39% 1.38% 1.34% 1.36% 1.36%<br>2Q22 3Q22 4Q22 1Q23 2Q23<br>Allowance for Credit Losses<br>Modest CECL Day 1 impact of $650K<br>on January 1, 2023<br>Allowance for Credit Losses % of Gross Loans<br>$688 $663 $639<br>$809 $778<br>0.02% 0.02% 0.01% 0.02% 0.02%<br>2Q22 3Q22 4Q22 1Q23 2Q23<br>Nonperforming Assets1<br>Consistently low NPA levels<br>NPAs % of Assets
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Watch and Substandard Loans<br>Remain Stable<br>13<br>C&I<br>17.6%<br>C&D<br>6.3%<br>Multifamily<br>11.9%<br>CRE NOO<br>Senior Housing<br>37.4%<br>CRE NOO<br>Retail<br>21.7%<br>CRE NOO<br>Office<br>2.6%<br>1-4<br>Family<br>2.5%<br>$27<br>Million<br>Watch List Loans Substandard Loans<br>C&I<br>47.8%<br>CRE NOO<br>Office<br>28.7%<br>CRE NOO<br>Hotels<br>9.8%<br>CRE NOO<br>Retail<br>7.9%<br>CRE OO<br>4.7%<br>C&D<br>0.3%<br>1-4<br>Family<br>0.8%<br>$34<br>Million<br>Watch List Characteristics<br>Loan Balances Outstanding $27,215<br>% of Total Loans, Gross 0.7%<br>Number of Loans 20<br>Average Loan Size $1,361<br>Substandard Characteristics<br>Loan Balances Outstanding $33,821<br>% of Total Loans, Gross 0.9%<br>Number of Loans 20<br>Average Loan Size $1,691<br>% of Bank Risk-Based Capital 6.34%<br>$34,705<br>$22,759<br>$32,252<br>$27,574 $27,215<br>2Q22 3Q22 4Q22 1Q23 2Q23<br>Watch List Loans<br>$26,991 $30,767 $28,049<br>$36,258 $33,821<br>2Q22 3Q22 4Q22 1Q23 2Q23<br>Substandard Loans<br>Dollars in thousands
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Managing CRE and Office-Related Risk<br>14 1 Excludes medical office of $87M at June 30, 2023<br>Dollars in millions<br>Addressing CRE NOO Repricing Risk<br>• CRE NOO loans primarily located in the Twin Cities market<br>• Ongoing active client engagement<br>• Clients with maturing loans or resetting rates over<br>the next 12 months<br>• Identify situations of possible cash flow strain<br>• Recommend solutions early in the process<br>Well-Managed CRE NOO Office Exposure1<br>Small CRE NOO<br>Office Portfolio<br>Low Average Loan<br>Size<br>LTVs In-Line with the<br>Total Loan Portfolio<br>5.2%<br>of Total Loans<br>$2.2M<br>Average Loan Size<br>62%<br>Weighted Average LTV<br>CRE NOO Office by Geography<br>Twin Cities<br>Suburban<br>53%<br>Minneapolis-St. Paul CBD<br>13%<br>Minneapolis-St. Paul Non-CBD<br>20%<br>Out-of-State<br>14%<br>$196M<br>• Majority of CRE NOO office<br>exposure in the Twin Cities<br>suburbs<br>• Only 4 loans totaling $35M<br>located in central business<br>districts (CBD)<br>• Only 3 loans totaling $27M<br>outside of Minnesota – out-of-state projects for existing<br>local clients<br>Lower<br>Repricing Risk<br>Fixed-Rate<br>Maturity Schedule Low LTVs<br>79%<br>are Fixed-Rate<br>$114M<br>Maturing Over the<br>Next 12 Months<br>61%<br>Weighted Average LTV
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Ample Liquidity and Borrowing Capacity<br>15 1 Excludes $236M of pledged securities at June 30, 2023<br>Dollars in millions<br>13.5% 14.0% 13.7%<br>10.9% 9.6%<br>25.0% 20.1% 17.0%<br>30.9% 33.1%<br>$1,498<br>$1,409 $1,380<br>$1,924 $1,962<br>2Q22 3Q22 4Q22 1Q23 2Q23<br>Off-Balance Sheet Liquidity as a % of Assets<br>On-Balance Sheet Liquidity as a % of Assets<br>Liquidity Position with 2.5x Coverage of Uninsured Deposits Diverse Liquidity Mix<br>2023 YTD Liquidity Actions<br>• Added $582M of on- and off-balance sheet liquidity YTD<br>• $828M increase in borrowing capacity with the FRB following<br>additional loan and securities pledging<br>• $91M increase to cash and cash equivalents<br>• Did not utilize any borrowings from the Discount Window or the Bank<br>Term Funding Program (BTFP) in 2023 YTD<br>Funding Source 6/30/2023 12/31/2022 Change<br>Cash $ 139 $ 4 8 $ 9 1<br>Unpledged Securities1<br> 302 549 (247)<br>FHLB Capacity 401 391 10<br>FRB Discount Window 986 158 828<br>Unsecured Lines of Credit 108 208 (100)<br>Secured Line of Credit 26 26 -<br> Total $ 1,962 $ 1,380 $ 582<br>Available Balance
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Well-Capitalized with Steady<br>Tangible Book Value Per Share Growth<br>16<br>10.33%<br>9.98%<br>9.55% 9.41% 9.47%<br>8.50% 8.47% 8.40% 8.48% 8.72%<br>13.98% 13.78%<br>13.15% 13.25% 13.50%<br>7.87%<br>7.57% 7.48% 7.23% 7.39%<br>2Q22 3Q22 4Q22 1Q23 2Q23<br>Total Risk-Based Capital Ratio Common Equity Tier 1 Capital Ratio<br>Tier 1 Leverage Ratio<br>Increased Consolidated Capital Ratios in 2Q23<br>Tangible Common Equity Ratio1<br>$4.52<br>$5.40<br>$7.22<br>$8.33<br>$9.31<br>$10.98<br>$11.69<br>$12.15<br>2016 2017 2018 2019 2020 2021 2022 2Q23<br>Steady Tangible Book Value Per Share1 Growth<br>1 Represents a Non-GAAP financial measure. See Appendix for Non-GAAP reconciliation<br>Dollars in millions, except per share data
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Near-Term Expectations<br>17<br>• High single-digit loan growth in the back half of 2023 – focus on aligning loan growth more closely with core deposit<br>growth over time<br>• Target loan-to-deposit ratio between 95% and 105%<br>Balance Sheet<br>Growth<br>• Expect the pace of net interest margin compression to continue to slow<br>• Magnitude dependent on the path of interest rates, shape of the yield curve and pace of core deposit growth and loan payoffs<br>Net Interest<br>Margin<br>• Increased pace of expense growth in the second half of 2023, including investments in people and technology,<br>FDIC insurance expense and IntraFi deposit costs<br>• Noninterest expense growth in-line with asset growth over time<br>Expenses<br>• Build tangible common equity and CET1 ratios, aided by retained earnings and managed pace of loan growth<br>• Ongoing evaluation of potential share repurchases<br>Capital<br>Levels
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2023 Strategic Priorities –<br>Positioning for Long-Term Success<br>18<br>Manage High Quality<br>Balance Sheet Growth 1<br>2<br>3<br>4<br>Maintain High Efficiency<br>While Investing in the<br>Business<br>Continue Scalability of<br>ERM Function, Including<br>Proactive Assessment of<br>Asset Quality Risks<br>Implement Longer Term<br>Strategic Readiness<br>Initiatives<br>• Slower pace of balance sheet growth in the current environment<br>• Manage the balance sheet to optimize net interest income<br>• Increase emphasis on generating core deposit growth to support loan<br>growth over the course of 2023<br>• Identify opportunities to better manage the discretionary spend to align<br>expense growth with a slower pace of asset growth<br>• Continue to invest in people and technology<br>• Make proactive investments to scale the business and position for<br>longer-term growth<br>• Continued build-out of the enterprise risk management function, including<br>enhanced stress testing capabilities<br>• Ongoing monitoring of the loan portfolio for signs of credit weakness given<br>the economic uncertainty heading into 2023<br>• Expand covenant testing and assess repricing risk on maturing loans<br>• Complete CECL adoption in early 2023<br>• Expand C&I function to support further diversification of the loan portfolio<br>and new deposit growth channels over time<br>• Continue evaluating potential M&A opportunities and be ready to act as<br>the right opportunity becomes available<br>Progress-to-Date<br>Core deposit growth outpaced<br>loan growth in 2Q23<br>NIE growth of 5% YoY compared to<br>asset growth of 19%<br>Adopted CECL on January 1, 2023<br>Relocated downtown<br>Minneapolis branch
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APPENDIX<br>19
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Interest Rate Sensitivity<br>20<br>Estimated Change in NII From<br>Immediate Interest Rate Shocks<br>+200 bps<br>+100 bps<br>-100 bps<br>(3.6)%<br>(1.7)%<br>+3.1%<br>• Change in rate sensitivity position impacted by rising interest rate<br>environment, deposit mix shift and leveraging wholesale deposits and<br>borrowings<br>• Better positioned for a steeper yield curve and potential future rate cuts<br>Loan Portfolio Considerations<br>• Loan portfolio most sensitive to changes in the 3- to 5-year portion of the<br>yield curve<br>• Fixed-rate nature of the loan portfolio (67%) results in slower repricing<br>compared to deposits<br>• Leveraging prepayment penalties on new loan originations to help<br>maintain benefit of higher rates over time<br>Deposit Considerations<br>• Increased focus on funding loan growth with core deposits over time<br>• Core deposit growth more challenging amid recent bank failures and rising<br>interest rate environment<br>• Continued to supplement core deposits with wholesale funding to support<br>loan growth<br>• Deposit base is more sensitive to changing interest rates<br>• Cumulative deposit beta of 48%1<br>(0.7)%<br>(0.4)%<br>+0.5%<br>2Q22 3Q22<br>-200 bps (2.0)% +2.4%<br>(2.3)%<br>(1.2)%<br>+1.0%<br>4Q22<br>+1.3%<br>(9.3)%<br>(4.6)%<br>+6.2%<br>1Q23<br>+12.2%<br>1 Calculated as the change in ending deposit rate over the change in ending Fed Funds rate from February 2022 to June 2023<br>(3.8)%<br>(1.9)%<br>+4.0%<br>2Q23<br>+7.5%
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17%<br>7%<br>19% 21% 16% 20%<br>$102<br>$41<br>$115 $126<br>$99 $119<br>Less<br>Than<br>1 Year<br>1 to 2<br>Years<br>2 to 3<br>Years<br>3 to 4<br>Years<br>4 to 5<br>Years<br>5+<br>Years<br>17% 15% 11% 14% 14%<br>29%<br>$422 $363<br>$265<br>$354 $351<br>$736<br>Less<br>Than<br>1 Year<br>1 to 2<br>Years<br>2 to 3<br>Years<br>3 to 4<br>Years<br>4 to 5<br>Years<br>5+<br>Years<br>Loan Portfolio Repricing<br>21<br>Fixed,<br>66.7%<br>Variable,<br>17.2%<br>Adjustable,<br>16.1%<br>Loan Portfolio Mix<br>Fixed-Rate Portfolio<br>($2.5B)<br>Variable-Rate Portfolio<br>($644M)<br>Adjustable-Rate Portfolio<br>($602M)<br>Years to Maturity<br>Stronger loan growth results in<br>relatively quick turn of the loan<br>portfolio and accelerated repricing:<br>• 16% year-over-year total loan<br>growth<br>• $972M of total loan<br>originations and advances over<br>prior 12 months<br>Variable-Rate Loan Floors<br>100% 100% 100% 100% 100%<br>$550 $550 $550 $550 $550<br>At or<br>Above<br>Floor<br>(6/30/23)<br>Up<br>25 bps<br>Up<br>50 bps<br>Up<br>75 bps<br>Up<br>100+ bps<br>Cumulative Percent of balances<br>at or above floor as rates rise<br>• 85% of variable-rate portfolio<br>have floors, all of which are at or<br>above their floors<br>• 95% of variable-rate loans are<br>currently tied to SOFR or Prime<br>Adjustable-Rate<br>Repricing Schedule<br>• Over 99% of the adjustable-rate<br>loans are at or above their floors<br>• Implies immediate repricing as<br>rates rise, depending on the<br>repricing schedule<br>Dollars in millions<br>Larger fixed-rate portfolio helps to<br>mitigate repricing risk
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High Quality Securities Portfolio<br>22<br>30% 35% 43% 41% 41%<br>35%<br>31% 24% 23% 24%<br>21%<br>20% 20% 21% 21%<br>14%<br>13% 13% 15% 14%<br>$483<br>$542 $549 $559 $538<br>2Q22 3Q22 4Q22 1Q23 2Q23<br>Mortgage-Backed Securities Municipal Bonds<br>Corporate Securities Other<br>Securities Available for Sale Portfolio<br>AAA,<br>21%<br>AA,<br>47%<br>A,<br>4%<br>BBB,<br>12%<br>BB,<br>1%<br>NR,<br>15%<br>Rating Mix<br>Derivatives Portfolio Offsetting AOCI Impact<br>$(47,884) $(52,064)<br>$28,581 $28,203<br>$(17,942) $(20,908)<br>4Q22 2Q23<br>MTM Securities MTM Derivatives Net Impact on AOCI1<br>• No held-to-maturity securities<br>• Securities portfolio average duration of 5.3 years<br>• Average securities portfolio yield of 4.24%<br>• Unrealized losses on AFS securities were 12.7% of<br>stockholders’ equity<br>• AOCI / Total RBC of 3.6% vs. peer bank median of 10.5%2<br>1 Includes the tax-effected impact of $7,232 in 4Q22 and $8,430 in 2Q23<br>2 1Q23 median for publicly-traded banks with total assets between $3 billion and $10 billion (Source: S&P Capital IQ)<br>Dollars in thousands
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Reconciliation of Non-GAAP Financial<br>Measures – Annual<br>23 Dollars in thousands<br>Tangible Common Equity &<br>Tangible Common Equity/Tangible<br>Assets 2016 2017 2018 2019 2020 2021 2022<br>Common Equity $ 115,366 $ 137,162 $ 220,998 $ 244,794 $ 265,405 $ 379,272 $ 394,064<br>Less: Preferred Stock - - - - - (66,514) (66,514)<br>Less: Intangible Assets (4,060) (3,869) (3,678) (3,487) (3,296) (3,105) (2,914)<br>Tangible Common Equity $ 111,306 $ 133,293 $ 217,320 $ 241,307 $ 262,109 $ 309,653 $ 324,636<br>Total Assets $ 1,260,394 $ 1,616,612 $ 1,973,741 $ 2,268,830 $ 2,927,345 $ 3,477,659 $ 4,345,662<br>Less: Intangible Assets (4,060) (3,869) (3,678) (3,487) (3,296) (3,105) (2,914)<br>Tangible Assets $ 1,256,334 $ 1,612,743 $ 1,970,063 $ 2,265,343 $ 2,924,049 $ 3,474,554 $ 4,342,748<br>Tangible Common Equity/Tangible Assets 8.86% 8.26% 11.03% 10.65% 8.96% 8.91% 7.48%<br>Tangible Book Value Per Share 2016 2017 2018 2019 2020 2021 2022<br>Book Value Per Common Share $ 4.69 $ 5.56 $ 7.34 $ 8.45 $ 9.43 $ 11.09 $ 11.80<br>Less: Effects of Intangible Assets (0.17) (0.16) (0.12) (0.12) (0.12) (0.11) (0.11)<br>Tangible Book Value Per Common Share $ 4.52 $ 5.40 $ 7.22 $ 8.33 $ 9.31 $ 10.98 $ 11.69<br>Total Common Shares 24,589,861 24,679,861 30,097,274 28,973,572 28,143,493 28,206,566 27,751,950<br>As of and for the year ended December 31,
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Reconciliation of Non-GAAP Financial<br>Measures – Profitability, TCE and TBV<br>24 Dollars in thousands<br>Efficiency Ratio<br>June 30,<br>2022<br>September 30,<br>2022<br>December 31,<br>2022<br>March 31,<br>2023<br>June 30,<br>2023<br>Noninterest Expense $ 13,752 $ 14,157 $ 15,203 $ 14,183 $ 14,388 Net Income Available to Common Shareholders<br>Less: Amortization Intangible Assets (47) (48) (48) (48) (34)<br>Adjusted Noninterest Expense $ 13,705 $ 14,109 $ 15,155 $ 14,135 $ 14,354 Average Total Shareholders' Equity<br>Less: Average Preferred Stock<br>Net Interest Income $ 32,530 $ 34,095 $ 32,893 $ 28,567 $ 25,872 Average Total Common Shareholders' Equity<br>Noninterest Income 1,650 1,387 1,738 1,943 1,415 Less: Effects of Average Intangible Assets<br>Less: (Gain) Loss on Sales of Securities (52) - (30) 56 (50) Average Tangible Common Equity<br>Adjusted Operating Revenue $ 34,128 $ 35,482 $ 34,601 $ 30,566 $ 27,237<br>Annualized Return on Average Tangible Common Equity<br>Efficiency Ratio 40.2% 39.8% 43.8% 46.2% 52.7%<br>Tangible Common Equity &<br>Tangible Common Equity/Tangible Assets<br>June 30,<br>2022<br>September 30,<br>2022<br>December 31,<br>2022<br>March 31,<br>2023<br>June 30,<br>2023<br>Total Shareholders' Equity $ 374,883 $ 382,007 $ 394,064 $ 402,006 $ 409,126<br>Less: Preferred Stock (66,514) (66,514) (66,514) (66,514) (66,514)<br>Total Common Shareholders' Equity 308,369 315,493 327,550 335,492 342,612<br>Less: Intangible Assets (3,009) (2,962) (2,914) (2,866) (2,832)<br>Tangible Common Equity $ 305,360 $ 312,531 $ 324,636 $ 332,626 $ 339,780<br>Total Assets $ 3,883,264 $ 4,128,987 $ 4,345,662 $ 4,602,899 $ 4,603,185<br>Less: Intangible Assets (3,009) (2,962) (2,914) (2,866) (2,832)<br>Tangible Assets $ 3,880,255 $ 4,126,025 $ 4,342,748 $ 4,600,033 $ 4,600,353<br>Tangible Common Equity/Tangible Assets 7.87% 7.57% 7.48% 7.23% 7.39%<br>Tangible Book Value Per Share<br>June 30,<br>2022<br>September 30,<br>2022<br>December 31,<br>2022<br>March 31,<br>2023<br>June 30,<br>2023<br>Book Value Per Common Share $ 11.14 $ 11.44 $ 11.80 $ 12.05 $ 12.25<br>Less: Effects of Intangible Assets (0.11) (0.11) (0.11) (0.10) (0.10)<br>Tangible Book Value Per Common Share $ 11.03 $ 11.33 $ 11.69 $ 11.95 $ 12.15<br>Total Common Shares 27,677,372 27,587,978 27,751,950 27,845,244 27,973,995<br>As of and for the quarter ended,<br>As of and for the quarter ended,<br>As of and for the quarter ended,<br>ROATCE<br>As of and for the quarter ended,<br>June 30, 2023<br>$ 8,802<br>$ 406,347<br> (66,514)<br>$ 339,833<br> (2,846)<br>$ 336,987<br>10.48%
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Reconciliation of Non-GAAP Financial<br>Measures – PPNR<br>25 Dollars in thousands<br>Pre-Provision Net Revenue<br>June 30,<br>2022<br>September 30,<br>2022<br>December 31,<br>2022<br>March 31,<br>2023<br>June 30,<br>2023<br>Noninterest Income $ 1,650 $ 1,387 $ 1,738 $ 1,943 $ 1,415<br>Less: (Gain) Loss on Sales on Securities (52) - (30) 5 6 (50)<br>Less: FHLB Advance Prepayment Income - - - (299) -<br>Total Operating Noninterest Income 1,598 1,387 1,708 1,700 1,365<br>Plus: Net Interest Income 32,530 34,095 32,893 28,567 25,872<br> Net Operating Revenue 34,128 35,482 34,601 30,267 27,237<br>Noninterest Expense $ 13,752 $ 14,157 $ 15,203 $ 14,183 $ 14,388<br>Less: Amortization of Tax Credit Investments (63) (114) (114) (114) (114)<br> Total Operating Noninterest Expense 13,689 14,043 15,089 14,069 14,274<br>Pre-Provision Net Revenue $ 20,439 $ 21,439 $ 19,512 $ 16,198 $ 12,963<br> Plus:<br>Non-Operating Revenue Adjustments 5 2 - 30 243 5 0<br> Less:<br>Provision for Credit Losses 3,025 1,500 1,500 625 5 0<br>Non-Operating Expense Adjustments 63 114 114 114 114<br>Provision for Income Taxes 4,521 5,312 4,193 4,060 3,033<br>Net Income $ 12,882 $ 14,513 $ 13,735 $ 11,642 $ 9,816<br>Average Assets $ 3,743,575 $ 3,948,201 $ 4,251,345 $ 4,405,234 $ 4,483,662<br>Pre-Provision Net Revenue Return on Average Assets 2.19% 2.15% 1.82% 1.49% 1.16%<br>As of and for the quarter ended,
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Reconciliation of Non-GAAP Financial<br>Measures – Core NIM<br>26 Dollars in thousands<br>Core Net Interest Margin<br>June 30,<br>2022<br>September 30,<br>2022<br>December 31,<br>2022<br>March 31,<br>2023<br>June 30,<br>2023<br>Net Interest Income (Tax-Equivalent Basis) $ 32,806 $ 34,418 $ 33,260 $ 28,947 $ 26,280<br>Less: Loan Fees (2,030) (1,400) (1,100) (998) (941)<br>Less: PPP Interest and Fees (263) (96) (48) (2) (3)<br> Core Net Interest Margin $ 30,513 $ 32,922 $ 32,112 $ 27,947 $ 25,336<br>Average Interest Earning Assets $ 3,671,748 $ 3,871,896 $ 4,177,644 $ 4,323,706 $ 4,395,050<br>Less: Average PPP Loans (8,335) (2,424) (1,109) (999) (913)<br> Core Average Interest Earning Assets $ 3,663,413 $ 3,869,472 $ 4,176,535 $ 4,322,707 $ 4,394,137<br>Core Net Interest Margin 3.34% 3.38% 3.05% 2.62% 2.31%<br>Loan Interest Income (Tax-Equivalent Basis) $ 34,468 $ 37,820 $ 42,702 $ 45,265 $ 48,066<br>Less: Loan Fees (2,030) (1,400) (1,100) (998) (941)<br>Less: PPP Interest and Fees (263) (96) (48) (2) (3)<br> Core Loan Interest Income $ 32,175 $ 36,324 $ 41,554 $ 44,265 $ 47,122<br>Average Loans $ 3,107,679 $ 3,265,814 $ 3,482,150 $ 3,630,446 $ 3,716,534<br>Less: Average PPP Loans (8,335) (2,424) (1,109) (999) (913)<br> Core Average Loans $ 3,099,344 $ 3,263,390 $ 3,481,041 $ 3,629,447 $ 3,715,621<br>Core Loan Yield 4.17% 4.42% 4.74% 4.95% 5.09%<br>As of and for the quarter ended,
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