8-K
USCB FINANCIAL HOLDINGS, INC. (USCB)
1
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
Date of Report (Date of earliest event reported):
October 31, 2024
__________________________
USCB Financial Holdings, Inc.
(Exact name of Registrant as Specified in Its Charter)
__________________________
Florida
001-41196
87-4070846
(State or Other Jurisdiction
of Incorporation)
(Commission File Number)
(IRS Employer
Identification No.)
2301 N.W. 87th Avenue
,
Doral
,
Florida
33172
(Address of Principal Executive Offices)
(Zip Code)
Registrant’s Telephone
Number, Including Area Code: (
305
)
715-5200
__________________________
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(s)
Name of each exchange on which registered
Class A common stock, $1.00 par value per share
USCB
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.
☐
2
Item 2.02. Results of Operations and Financial Condition.
On October 31, 2024,
USCB Financial Holdings, Inc.
(the “Company”) issued a
press release announcing its
financial results
for the quarter ended
September 30, 2024. A copy
of the press release is furnished
as Exhibit 99.1 to
this Current Report on Form
8-K
(“Form 8-K”) and is incorporated herein by reference.
The information
in this Item
2.02, including
Exhibit 99.1, is
being furnished
and shall not
be deemed
“filed” for purposes
of
Section 18 of the
Securities Exchange Act
of 1934 (the “Exchange
Act”), or otherwise subject
to the liability of
that section, and
shall
not be deemed
to be incorporated
by reference into
any filing under
the Securities Act of
1933 (the “Securities
Act”) or the
Exchange
Act except as expressly set forth by specific reference in such filing to this Form 8-K.
Item 7.01. Regulation FD Disclosure.
As previously announced, at
11:00 a.m. ET on
November 1, 2024,
the Company will
hold an earnings
conference call to
discuss
its financial performance
for the quarter ended
September 30, 2024. A copy
of the slides forming
the basis of the presentation
is being
furnished as
Exhibit 99.2
to this
Form 8-K
and is
incorporated herein
by reference.
A copy
of the
slides has
also been
posted to
the
Company’s investor relations website,
located at investors.uscenturybank.com.
The information
in this Item
7.01, including
Exhibit 99.2, is
being furnished
and shall not
be deemed
“filed” for purposes
of
Section 18
of the
Exchange Act,
or otherwise
subject to
the
liability of
that section,
and
shall not
be deemed
to be
incorporated
by
reference into any filing under the
Securities Act or the Exchange Act
except as set forth by
specific reference in such filing to
this Form
8-K.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
Exhibit No.
Description
99.1
USCB Financial Holdings, Inc. Press Release, dated October 31, 2024
99.2
Earnings Presentation, dated October 31, 2024
104
Cover Page Interactive Data File (embedded within the Inline XBRL document)
3
SIGNATURE
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 hereunto duly authorized.
USCB Financial Holdings, Inc.
By:
/s/ Robert Anderson
Name:
Robert Anderson
Title:
Chief Financial Officer
Date: October 31, 2024
exhibit991
1
Exhibit 99.1
EARNINGS RELEASE
USCB Financial Holdings, Inc. Reports Record Fully Diluted EPS of
$0.35 for Q3 2024; ROAA of 1.11% and
ROAE of 13.38%
MIAMI, FL – October 31, 2024 – USCB Financial Holdings, Inc. (the
“Company”) (NASDAQ: USCB)
, the holding company for
U.S.
Century
Bank
(the
“Bank”),
reported
net
income
of
$6.9
million
or
$0.35
per
fully
diluted
share
for
the
three
months
ended
September 30, 2024, compared with net income of $3.8 million or $0.19
per fully diluted share for the same period in 2023.
“We
are proud
to report
our second
consecutive quarter
of record
fully diluted
earnings per
share, demonstrating
the strength
of our
strategic initiatives and
operational performance.”
said Luis de la
Aguilera, Chairman, President,
and CEO. “With
a return on average
assets of
1.11%
and a
NIM of 3.03%,
we are
effectively leveraging
our assets
to drive
profitability.
Additionally,
our growth
in non-
interest
income
reflects
our
commitment
to
diversifying
revenue
streams
and
enhancing
shareholder
value.
We
remain
focused
on
delivering strong performance and sustainable growth to our stakeholders
.” said de la Aguilera.
Unless otherwise stated, all percentage
comparisons in the bullet points
below are calculated at
or for the quarter
ended September 30,
2024 compared to at or for the quarter ended September 30, 2023
and annualized where appropriate.
Profitability
•
Annualized return on average assets for the quarter
ended September 30, 2024 was 1.11%
compared to 0.67% for the third quarter
of 2023.
•
Annualized return on
average stockholders’ equity
for the quarter
ended September 30,
2024 was 13.38%
compared to 8.19%
for
the third quarter of 2023.
•
The efficiency ratio for the quarter ended September 30,
2024 was 53.16% compared to 64.64% for the third quarter of 2023.
•
Net interest margin for the quarter ended September 30, 2024
was 3.03%
compared to 2.60% for the third quarter of 2023.
•
Net interest income
before provision for
credit losses was
$18.1 million for
the quarter ended
September 30, 2024, an
increase of
$4.1 million or 29.1% compared to the third quarter of 2023.
Balance Sheet
•
Total
assets
were
$2.5
billion
at
September 30,
2024,
representing
an
increase
of
$259.4 million
or
11.6%
from
$2.2
billion
at
September 30, 2023.
•
Total
loans
were
$1.9
billion
at
September 30,
2024,
representing
an
increase
of
$254.8 million
or
15.2%
from
$1.7
billion
at
September 30, 2023.
•
Total
deposits were
$2.1 billion at
September 30, 2024,
representing an
increase of
$205.7 million or
10.7% from
$1.9 billion
at
September 30, 2023.
•
Total
stockholders’
equity
was
$213.9 million
at
September 30,
2024,
representing
an
increase
of
$31.0
million
or
17.0% from
$182.9
million
at September 30,
- Total
stockholders’ equity
included
accumulated comprehensive
loss of
$38.0 million
at
September 30, 2024 compared to accumulated comprehensive loss of $51.2
million at September 30, 2023.
Asset Quality
•
The allowance
for credit
losses (“ACL”)
increased by
$3.6 million
to $23.1
million at
September 30, 2024
from $19.5
million at
September 30, 2023.
•
The ACL represented 1.19% of total loans at September 30, 2024
and 1.16% at September 30, 2023.
2
•
Provision for credit
loss was $931 thousand
for the quarter
ended September 30, 2024,
an increase of
$278 thousand compared
to
the third quarter of 2023.
•
Non-performing
loans to
total loans
was 0.14%
at September 30,
2024 and
0.03% at
September 30, 2023.
Nonperforming loans
totaled $2.7 million at September 30, 2024 and $479 thousand at September
30, 2023.
Non-interest Income and Non-interest Expense
•
Non-interest
income was
$3.4
million
for
the
three
months
ended September 30,
2024,
an
increase
of
$1.3
million
or
59.1%
compared to $2.2 million for the same period in 2023.
•
Non-interest
expense
was
$11.5
million
for
the
three
months
ended
September 30,
2024,
an
increase
of
$1.0
million
or
9.5%
compared to $10.5 million for the same period in 2023.
Capital
•
On October
28, 2024,
the Company’s
Board of
Directors declared
a cash
dividend of
$0.05 per
share of
the Company’s
Class A
common stock. The dividend will be paid on December 5, 2024 to shareholders of record at the close of business on November 15,
2024.
•
As of September 30, 2024,
total risk-based capital ratios for the Company and the Bank were 13.22% and 13.14%,
respectively.
•
Tangible
book value
per common
share (a
non-GAAP measure)
was $10.90
at September 30,
2024, representing
an increase
of
$0.66
or 25.6%
annualized
from
$10.24
at June
30,
2024.
At September
30,
2024,
tangible book
value
per
common
share was
negatively affected by $1.94 due to an accumulated comprehensive loss
of $38.0 million. At June 30, 2024, tangible
book value per
common share was negatively affected by $2.28 due
to an accumulated comprehensive loss of $44.7 million.
•
During
the quarter,
the Company
repurchased
10,000
shares of
Class A
common
stock at
a weighted
average
cost per
share of
$12.03. The
aggregate purchase price
for these transactions
was approximately
$120 thousand,
including transaction
costs. As of
September 30, 2024, 537,980 shares remained authorized for repurchase
under the Company’s share repurchase programs.
Conference Call and Webcast
The Company will host a conference call
on Friday, November 1, 2024, at 11:00 a.m. Eastern Time to discuss the Company’s unaudited
financial results
for the quarter
ended September 30, 2024.
To
access the conference
call, dial (833)
816-1416 (U.S. toll-free)
and ask
to join the USCB Financial Holdings Call.
Additionally,
interested
parties can
listen to
a live
webcast
of the
call in
the “Investor
Relations” section
of the
Company’s
website
at www.uscentury.com
.
An archived version of the webcast will be available in the same location shortly after
the live call has ended.
About USCB Financial Holdings, Inc.
USCB Financial Holdings, Inc.
is the bank holding company for
U.S. Century Bank. Established in 2002,
U.S. Century Bank is one of
the largest
community banks
headquartered
in Miami,
and one
of the
largest community
banks in
the State
of Florida.
U.S. Century
Bank is rated 5-Stars by BauerFinancial, the nation’s leading independent
bank rating firm. U.S. Century Bank offers customers a wide
range of
financial products
and services
and supports
numerous community
organizations,
including
the Greater
Miami Chamber
of
Commerce, the South Florida Hispanic Chamber of Commerce, and ChamberSouth. For more information about us
or to find a banking
center near you, please call (305) 715-5200 or visit www.uscentury.com.
Forward-Looking Statements
This earnings release
may contain statements
that are not
historical in nature
and are intended
to be, and
are hereby identified
as, forward-
looking
statements
for
purposes
of
the
safe
harbor
provided
by
Section
21E
of
the
Securities
Exchange
Act
of
1934,
as
amended.
Forward-looking statements are
those that are
not historical facts.
The words “may,”
“will,” “anticipate,” “could,”
“should,” “would,”
“believe,” “contemplate,”
“expect,” “aim,”
“plan,” “estimate,”
“continue,” and
“intend,”, the negative
of these terms,
as well as
other
similar
words
and
expressions
of
the
future,
are
intended
to identify
forward-looking
statements.
These
forward-looking
statements
include, but are not limited
to, statements related to our
projected growth, anticipated future financial
performance, and management’s
long-term performance goals, as well as statements
relating to the anticipated effects on our results of
operations and financial condition
from expected or potential developments or events, or business and
growth strategies, including anticipated internal growth and balance
sheet restructuring.
3
These forward-looking statements involve significant risks and uncertainties that could cause our actual
results to differ materially from
those anticipated in such statements. Potential risks and uncertainties include,
but are not limited to:
•
the strength of the United States economy in general and the strength of the local economies in
which we conduct operations;
•
our ability to successfully manage interest rate risk, credit risk, liquidity risk,
and other risks inherent to our industry;
•
the
accuracy
of
our
financial
statement
estimates
and
assumptions,
including
the
estimates
used
for
our
credit
loss
reserve
and
deferred tax asset valuation allowance;
•
the efficiency and effectiveness of our internal
control procedures and processes;
•
our ability to comply with
the extensive laws and
regulations to which we are
subject, including the laws for
each jurisdiction where
we operate;
•
adverse changes or conditions in capital and financial markets, including
actual or potential stresses in the banking industry;
•
deposit attrition and the level of our uninsured deposits;
•
legislative
or
regulatory
changes and
changes
in
accounting
principles,
policies,
practices or
guidelines,
including
the on-going
effects of the implementation of the Current Expected Credit Losses (“CECL”)
standard;
•
the
lack
of
a
significantly
diversified
loan
portfolio
and
the
concentration
in
the
South
Florida
market,
including
the
risks
of
geographic,
depositor,
and
industry
concentrations,
including
our
concentration
in
loans
secured
by
real
estate,
in
particular,
commercial real estate;
•
the effects of climate change;
•
the concentration of ownership of our common stock;
•
fluctuations in the price of our common stock;
•
our ability to
fund or access
the capital markets
at attractive rates
and terms and
manage our growth,
both organic
growth as well
as growth through other means, such as future acquisitions;
•
inflation, interest rate, unemployment rate, and market
and monetary fluctuations;
•
impacts of international hostilities and geopolitical events;
•
increased competition
and its effect
on the pricing
of our products
and services as
well as our
interest rate spread
and net interest
margin;
•
the loss of key employees;
•
the effectiveness
of our risk management
strategies, including operational
risks, including, but
not limited to, client,
employee, or
third-party fraud and security breaches; and
•
other risks described in this earnings release and other filings we make with the
Securities and Exchange Commission (“SEC”).
All forward-looking
statements are
necessarily only
estimates of
future results,
and there
can be
no assurance
that actual
results will
not differ
materially from
expectations. Therefore,
you are
cautioned not
to place
undue reliance
on any
forward-looking statements.
Further, forward-looking statements included in this
earnings release are
made only as
of the date
hereof, and we
undertake no obligation
to update or revise any forward-looking statement to reflect events
or circumstances after the date on which the statements are made
or
to reflect the occurrence of unanticipated
events, unless required to do
so under the federal securities laws.
You
should also review the
risk factors described in the reports the Company filed or will file with the SEC.
Non-GAAP Financial Measures
This earnings release
includes financial information determined
by methods other
than in accordance
with generally accepted
accounting
principles (“GAAP”). This financial
information includes certain
operating performance measures. Management
has included these
non-
GAAP
measures
because
it
believes
these
measures
may
provide
useful
supplemental
information
for
evaluating
the
Company’s
operations and
underlying performance
trends. Further,
management uses these
measures in
managing and
evaluating the Company’s
business and intends to refer to
them in discussions about our operations
and performance. Operating performance
measures should be
viewed
in
addition
to,
and
not
as
an
alternative
to
or
substitute
for,
measures
determined
in
accordance
with
GAAP,
and
are
not
necessarily
comparable
to
non-GAAP
measures
that
may
be
presented
by
other
companies.
Reconciliations
of
these
non-GAAP
measures
to
the most
directly
comparable
GAAP measures
can be
found
in the
‘Non-GAAP
Reconciliation
Tables’
included
in the
exhibits to this earnings release.
All numbers included in this press release are unaudited unless otherwise noted.
Contacts:
Investor Relations
InvestorRelations@uscentury.com
Media Relations
Martha Guerra-Kattou
MGuerra@uscentury.com
4
USCB FINANCIAL HOLDINGS, INC.
CONSOLIDATED STATEMENTS
OF INCOME (UNAUDITED)
(Dollars in thousands, except per share data)
Three Months Ended September 30,
Nine Months Ended September 30,
2024
2023
2024
2023
Interest income:
Loans, including fees
$
29,819
$
22,523
$
84,479
$
63,081
Investment securities
2,754
2,833
8,634
7,501
Interest-bearing deposits in financial institutions
989
1,026
3,953
2,459
Total interest income
33,562
26,382
97,066
73,041
Interest expense:
Interest-bearing checking deposits
411
331
1,171
574
Savings and money market accounts
10,064
8,779
30,529
20,532
Time deposits
3,391
2,565
9,907
5,767
FHLB advances and other borrowings
1,587
685
4,881
1,976
Total interest expense
15,453
12,360
46,488
28,849
Net interest income before provision for credit losses
18,109
14,022
50,578
44,192
Provision for credit losses
931
653
2,127
892
Net interest income after provision for credit losses
17,178
13,369
48,451
43,300
Non-interest income:
Service fees
2,544
1,329
6,172
3,707
Gain (loss) on sale of securities available for sale, net
-
(955)
14
(976)
Gain on sale of loans held for sale, net
109
255
593
696
Other non-interest income
785
1,532
2,334
2,650
Total non-interest income
3,438
2,161
9,113
6,077
Non-interest expense:
Salaries and employee benefits
7,200
6,066
20,863
18,325
Occupancy
1,341
1,350
3,921
3,968
Regulatory assessments and fees
452
365
1,361
1,041
Consulting and legal fees
161
513
1,016
1,257
Network and information technology services
513
481
1,499
1,464
Other operating expense
1,787
1,686
5,528
5,034
Total non-interest expense
11,454
10,461
34,188
31,089
Net income before income tax expense
9,162
5,069
23,376
18,288
Income tax expense
2,213
1,250
5,606
4,464
Net income
$
6,949
$
3,819
$
17,770
$
13,824
Per share information:
Net income per common share, basic
$
0.35
$
0.20
$
0.90
$
0.70
Net income per common share, diluted
$
0.35
$
0.19
$
0.90
$
0.70
Cash dividends declared
$
0.05
$
-
$
0.15
$
-
Weighted average shares outstanding:
Common shares, basic
19,621,447
19,542,723
19,653,103
19,661,685
Common shares, diluted
19,825,211
19,611,897
19,761,242
19,729,181
5
USCB FINANCIAL HOLDINGS, INC.
SELECTED FINANCIAL DATA (UNAUDITED)
(Dollars in thousands, except per share data)
As of or For the Three Months Ended
9/30/2024
6/30/2024
3/31/2024
12/31/2023
9/30/2023
Income statement data:
Net interest income
$
18,109
$
17,311
$
15,158
$
14,376
$
14,022
Provision for credit losses
931
786
410
1,475
653
Net interest income after provision for credit losses
17,178
16,525
14,748
12,901
13,369
Service fees
2,544
1,977
1,651
1,348
1,329
Gain (loss) on sale of securities available for sale, net
-
14
-
(883)
(955)
Gain on sale of loans held for sale, net
109
417
67
105
255
Other income
785
803
746
756
1,532
Total non-interest income
3,438
3,211
2,464
1,326
2,161
Salaries and employee benefits
7,200
7,353
6,310
6,104
6,066
Occupancy
1,341
1,266
1,314
1,262
1,350
Regulatory assessments and fees
452
476
433
412
365
Consulting and legal fees
161
263
592
642
513
Network and information technology services
513
479
507
552
481
Other operating expense
1,787
1,723
2,018
1,747
1,686
Total non-interest expense
11,454
11,560
11,174
10,719
10,461
Net income before income tax expense
9,162
8,176
6,038
3,508
5,069
Income tax expense
2,213
1,967
1,426
787
1,250
Net income
$
6,949
$
6,209
$
4,612
$
2,721
$
3,819
Per share information:
Net income per common share, basic
$
0.35
$
0.32
$
0.23
$
0.14
$
0.20
Net income per common share, diluted
$
0.35
$
0.31
$
0.23
$
0.14
$
0.19
Cash dividends declared
$
0.05
$
0.05
$
0.05
$
-
$
-
Balance sheet data (at period-end):
Cash and cash equivalents
$
38,486
$
77,261
$
126,546
$
41,062
$
33,435
Securities available-for-sale
$
259,527
$
236,444
$
259,992
$
229,329
$
218,609
Securities held-to-maturity
$
167,001
$
169,606
$
173,038
$
174,974
$
197,311
Total securities
$
426,528
$
406,050
$
433,030
$
404,303
$
415,920
Loans held for investment
(1)
$
1,931,362
$
1,869,249
$
1,821,196
$
1,780,827
$
1,676,520
Allowance for credit losses
$
(23,067)
$
(22,230)
$
(21,454)
$
(21,084)
$
(19,493)
Total assets
$
2,503,954
$
2,458,270
$
2,489,142
$
2,339,093
$
2,244,602
Non-interest-bearing demand deposits
$
637,313
$
579,243
$
576,626
$
552,762
$
573,546
Interest-bearing deposits
$
1,489,304
$
1,477,459
$
1,526,168
$
1,384,377
$
1,347,376
Total deposits
$
2,126,617
$
2,056,702
$
2,102,794
$
1,937,139
$
1,920,922
FHLB advances and other borrowings
$
118,000
$
162,000
$
162,000
$
183,000
$
102,000
Total liabilities
$
2,290,038
$
2,257,250
$
2,294,131
$
2,147,125
$
2,061,718
Total stockholders' equity
$
213,916
$
201,020
$
195,011
$
191,968
$
182,884
Capital ratios:
(2)
Leverage ratio
9.34%
9.03%
8.91%
9.28%
9.26%
Common equity tier 1 capital
12.01%
11.93%
11.80%
11.62%
11.97%
Tier 1 risk-based capital
12.01%
11.93%
11.80%
11.62%
11.97%
Total risk-based capital
13.22%
13.12%
12.98%
12.78%
13.10%
(1)
Loan amounts include deferred fees/costs.
(2) Reflects the Company's regulatory capital ratios which are
provided for informational purposes only; as a small bank holding
company, the Company is not subject
to regulatory capital requirements. The Bank's total risk-based
capital for third quarter 2024 was 13.14%.
6
USCB FINANCIAL HOLDINGS, INC.
AVERAGE BALANCES, RATIOS,
AND OTHER DATA (UNAUDITED)
(Dollars in thousands)
As of or For the Three Months Ended
9/30/2024
6/30/2024
3/31/2024
12/31/2023
9/30/2023
Average balance sheet data:
Cash and cash equivalents
$
87,937
$
107,831
$
132,266
$
57,069
$
90,742
Securities available-for-sale
$
244,881
$
263,345
$
239,896
$
215,649
$
222,134
Securities held-to-maturity
$
168,632
$
171,682
$
174,142
$
181,151
$
218,694
Total securities
$
413,514
$
435,027
$
414,038
$
396,800
$
440,828
Loans held for investment
(1)
$
1,878,230
$
1,828,487
$
1,781,528
$
1,698,611
$
1,610,864
Total assets
$
2,485,434
$
2,479,222
$
2,436,103
$
2,268,811
$
2,250,258
Interest-bearing deposits
$
1,468,067
$
1,473,513
$
1,473,831
$
1,336,470
$
1,353,516
Non-interest-bearing demand deposits
$
609,456
$
610,370
$
574,760
$
577,133
$
587,917
Total deposits
$
2,077,523
$
2,083,883
$
2,048,591
$
1,913,603
$
1,941,433
FHLB advances and other borrowings
$
156,043
$
162,000
$
164,187
$
139,000
$
85,326
Total liabilities
$
2,278,793
$
2,281,467
$
2,243,011
$
2,085,182
$
2,065,357
Total stockholders' equity
$
206,641
$
197,755
$
193,092
$
183,629
$
184,901
Performance ratios:
Return on average assets
(2)
1.11%
1.01%
0.76%
0.48%
0.67%
Return on average equity
(2)
13.38%
12.63%
9.61%
5.88%
8.19%
Net interest margin
(2)
3.03%
2.94%
2.62%
2.65%
2.60%
Non-interest income to average assets
(2)
0.55%
0.52%
0.41%
0.23%
0.38%
Non-interest expense to average assets
(2)
1.83%
1.88%
1.84%
1.87%
1.84%
Efficiency ratio
(3)
53.16%
56.33%
63.41%
68.27%
64.64%
Loans by type (at period end):
(4)
Residential real estate
$
283,477
$
256,807
$
237,906
$
204,419
$
188,880
Commercial real estate
$
1,095,112
$
1,053,030
$
1,057,800
$
1,047,593
$
1,005,280
Commercial and industrial
$
246,539
$
248,525
$
228,045
$
219,757
$
212,975
Correspondent banks
$
103,815
$
112,510
$
100,182
$
114,945
$
94,640
Consumer and other
$
198,604
$
194,644
$
194,325
$
191,930
$
173,096
Asset quality data:
Allowance for credit losses to total loans
1.19%
1.19%
1.18%
1.18%
1.16%
Allowance for credit losses to non-performing loans
846%
2,933%
4,705%
4,505%
4,070%
Total non-performing loans
(5)
$
2,725
$
758
$
456
$
468
$
479
Non-performing loans to total loans
0.14%
0.04%
0.03%
0.03%
0.03%
Non-performing assets to total assets
(5)
0.11%
0.03%
0.02%
0.02%
0.02%
Net charge-offs (recoveries of) to average loans
(2)
(0.00)%
(0.00)%
(0.00)%
(0.00)%
(0.00)%
Net charge-offs (recovery) of credit losses
$
(6)
$
(2)
$
(7)
$
(3)
$
(5)
Interest rates and yields:
(2)
Loans
6.32%
6.16%
6.01%
5.79%
5.55%
Investment securities
2.61%
2.80%
2.69%
2.46%
2.52%
Total interest-earning assets
5.61%
5.54%
5.34%
5.16%
4.89%
Deposits
(6)
2.66%
2.64%
2.76%
2.53%
2.39%
FHLB advances and other borrowings
4.05%
4.03%
4.10%
4.04%
3.19%
Total interest-bearing liabilities
3.79%
3.76%
3.86%
3.66%
3.41%
Other information:
Full-time equivalent employees
198
197
199
196
194
(1)
Loan amounts include deferred fees/costs.
(2)
Annualized.
(3)
Efficiency ratio is defined as total non-interest expense divided
by sum of net interest income and total non-interest
income.
(4)
Loan amounts exclude deferred fees/costs.
(5)
The amounts for total non-performing loans and total non-performing
assets are the same at the dates presented since there was
no other real estate owned (OREO)
recorded.
(6) Reflects effect of non-interest-bearing deposits.
7
USCB FINANCIAL HOLDINGS, INC.
NET INTEREST MARGIN (UNAUDITED)
(Dollars in thousands)
Three Months Ended September 30,
2024
2023
Average
Balance
Interest
Yield/Rate
(1)
Average
Balance
Interest
Yield/Rate
(1)
Assets
Interest-earning assets:
Loans
(2)
$
1,878,230
$
29,819
6.32%
$
1,610,864
$
22,523
5.55%
Investment securities
(3)
419,315
2,754
2.61%
445,828
2,833
2.52%
Other interest-earning assets
80,378
989
4.89%
83,479
1,026
4.88%
Total interest-earning assets
2,377,923
33,562
5.61%
2,140,171
26,382
4.89%
Non-interest-earning assets
107,511
110,087
Total assets
$
2,485,434
$
2,250,258
Liabilities and stockholders' equity
Interest-bearing liabilities:
Interest-bearing checking deposits
$
57,925
411
2.82%
$
52,080
331
2.52%
Saving and money market deposits
1,084,562
10,064
3.69%
1,011,164
8,779
3.44%
Time deposits
325,580
3,391
4.14%
290,272
2,565
3.51%
Total interest-bearing deposits
1,468,067
13,866
3.76%
1,353,516
11,675
3.42%
FHLB advances and other borrowings
156,043
1,587
4.05%
85,326
685
3.19%
Total interest-bearing liabilities
1,624,110
15,453
3.79%
1,438,842
12,360
3.41%
Non-interest-bearing demand deposits
609,456
587,917
Other non-interest-bearing liabilities
45,227
38,598
Total liabilities
2,278,793
2,065,357
Stockholders' equity
206,641
184,901
Total liabilities and stockholders' equity
$
2,485,434
$
2,250,258
Net interest income
$
18,109
$
14,022
Net interest spread
(4)
1.82%
1.48%
Net interest margin
(5)
3.03%
2.60%
(1)
Annualized.
(2)
Average loan balances include non-accrual loans. Interest income on loans includes accretion
of deferred loan fees, net of deferred loan costs.
(3)
At fair value except for securities held to maturity. This amount includes FHLB
stock.
(4)
Net interest spread is the average yield earned on total
interest-earning assets minus the average rate paid on total interest-bearing
liabilities.
(5)
Net interest margin is the ratio of net interest income to total
interest-earning assets.
8
USCB FINANCIAL HOLDINGS, INC.
NON-GAAP FINANCIAL MEASURES (UNAUDITED)
(Dollars in thousands)
As of or For the Three Months Ended
9/30/2024
6/30/2024
3/31/2024
12/31/2023
9/30/2023
Pre-tax pre-provision ("PTPP") income:
(1)
Net income
$
6,949
$
6,209
$
4,612
$
2,721
$
3,819
Plus: Provision for income taxes
2,213
1,967
1,426
787
1,250
Plus: Provision for credit losses
931
786
410
1,475
653
PTPP income
$
10,093
$
8,962
$
6,448
$
4,983
$
5,722
PTPP return on average assets:
(1)
PTPP income
$
10,093
$
8,962
$
6,448
$
4,983
$
5,722
Average assets
$
2,485,434
$
2,479,222
$
2,436,103
$
2,268,811
$
2,250,258
PTPP return on average assets
(2)
1.62%
1.45%
1.06%
0.87%
1.01%
Operating net income:
(1)
Net income
$
6,949
$
6,209
$
4,612
$
2,721
$
3,819
Less: Net gains (losses) on sale of securities
-
14
-
(883)
(955)
Less: Tax effect on sale of securities
-
(4)
-
224
242
Operating net income
$
6,949
$
6,199
$
4,612
$
3,380
$
4,532
Operating PTPP income:
(1)
PTPP income
$
10,093
$
8,962
$
6,448
$
4,983
$
5,722
Less: Net gains (losses) on sale of securities
-
14
-
(883)
(955)
Operating PTPP income
$
10,093
$
8,948
$
6,448
$
5,866
$
6,677
Operating PTPP return on average assets:
(1)
Operating PTPP income
$
10,093
$
8,948
$
6,448
$
5,866
$
6,677
Average assets
$
2,485,434
$
2,479,222
$
2,436,103
$
2,268,811
$
2,250,258
Operating PTPP return on average assets
(2)
1.62%
1.45%
1.06%
1.03%
1.18%
Operating return on average assets:
(1)
Operating net income
$
6,949
$
6,199
$
4,612
$
3,380
$
4,532
Average assets
$
2,485,434
$
2,479,222
$
2,436,103
$
2,268,811
$
2,250,258
Operating return on average assets
(2)
1.11%
1.01%
0.76%
0.59%
0.80%
Operating return on average equity:
(1)
Operating net income
$
6,949
$
6,199
$
4,612
$
3,380
$
4,532
Average equity
$
206,641
$
197,755
$
193,092
$
183,629
$
184,901
Operating return on average equity
(2)
13.38%
12.61%
9.61%
7.30%
9.72%
Operating Revenue:
(1)
Net interest income
$
18,109
$
17,311
$
15,158
$
14,376
$
14,022
Non-interest income
3,438
3,211
2,464
1,326
2,161
Less: Net gains (losses) on sale of securities
-
14
-
(883)
(955)
Operating revenue
$
21,547
$
20,508
$
17,622
$
16,585
$
17,138
Operating Efficiency Ratio:
(1)
Total non-interest expense
$
11,454
$
11,560
$
11,174
$
10,719
$
10,461
Operating revenue
$
21,547
$
20,508
$
17,622
$
16,585
$
17,138
Operating efficiency ratio
53.16%
56.37%
63.41%
64.63%
61.04%
(1) The Company believes these non-GAAP measurements are
key indicators of the ongoing earnings power of the
Company.
(2)
Annualized.
9
USCB FINANCIAL HOLDINGS, INC.
NON-GAAP FINANCIAL MEASURES (UNAUDITED)
(Dollars in thousands, except per share data)
As of or For the Three Months Ended
9/30/2024
6/30/2024
3/31/2024
12/31/2023
9/30/2023
Tangible book value per common share (at period-end):
(1)
Total stockholders' equity
$
213,916
$
201,020
$
195,011
$
191,968
$
182,884
Less: Intangible assets
-
-
-
-
-
Tangible stockholders' equity
$
213,916
$
201,020
$
195,011
$
191,968
$
182,884
Total shares issued and outstanding (at period-end):
Total common shares issued and outstanding
19,620,632
19,630,632
19,650,463
19,575,435
19,542,290
Tangible book value per common share
(2)
$
10.90
$
10.24
$
9.92
$
9.81
$
9.36
Operating diluted net income per common share:
(1)
Operating net income
$
6,949
$
6,199
$
4,612
$
3,380
$
4,532
Total weighted average diluted shares of common stock
19,825,211
19,717,167
19,698,258
19,573,350
19,611,897
Operating diluted net income per common share:
$
0.35
$
0.31
$
0.23
$
0.17
$
0.23
Tangible Common Equity/Tangible Assets
(1)
Tangible stockholders' equity
$
213,916
$
201,020
$
195,011
$
191,968
$
182,884
Tangible total assets
(3)
$
2,503,954
$
2,458,270
$
2,489,142
$
2,339,093
$
2,244,602
Tangible Common Equity/Tangible Assets
8.54%
8.18%
7.83%
8.21%
8.15%
(1)
The Company believes these non-GAAP measurements
are key indicators of the ongoing earnings power
of the Company.
(2)
Excludes the dilutive effect, if any, of shares of common stock issuable upon exercise of outstanding
stock options.
(3) Since the Company has no intangible assets, tangible
total assets is the same amount as total assets calculated
under GAA
P.
exhibit992
Exhibit 99.2
EARNINGS PRESENTATION THIRD QUARTER 2024
NASDAQ: USCB USCB FINANCIAL HOLDING | U.S. CENTURY
BANK
FORWARD-LOOKING STATEMENTS This presentation
may contain statements that are not historical in nature and are
intended to be, and are hereby identified as, forward-looking statements
for purposes of the safe harbor provided by Section 21E of the
Securities Exchange Act of 1934, as amended.
Forward-looking statements are those that are not historical facts.
The words “may,” “will,” “anticipate,” “could,” “ should,” “would,”
“believe,” “contemplate,” “expect,” “aim,” “plan,” “estimate,”
“continue,” and “intend,”, the negative of these terms, as well as other
similar words and expressions of the future, are intended to identify
forward-looking statements. These forward-looking statements
include, but are not limited to, statements related to our projected
growth, anticipated future financial performance, and management’s
long-term performance goals, as well as statements relating to
the anticipated effects on our results of operations and financial condition
from expected or potential developments or events, or business and
growth strategies, including anticipated internal growth and balance
sheet restructuring. These forward-looking statements involve
significant risks and uncertainties that could cause our actual
results to differ materially from those anticipated in such statements.
Potential risks and uncertainties include, but are not limited to: the
strength of the United States economy in general and the strength
of the local economies in which we conduct operations; our
ability to successfully manage interest rate risk, credit risk,
liquidity risk, and other risks inherent to our industry; the accuracy
of our financial statement estimates
and assumptions, including the estimates used for our credit loss
reserve and deferred tax asset valuation allowance; the efficiency
and effectiveness of our internal control procedures and
processes; our ability to comply with the extensive laws and regulations
to which
we are subject, including the laws for each jurisdiction where we operate;
adverse changes or conditions in the capital and financial markets,
including actual or potential stresses in the banking industry;
deposit attrition and the level of our uninsured deposits; legislative
or regulatory changes and changes in accounting principles,
policies, practices or guidelines, including the on-going effects
of the implementation of the Current Expected Credit Losses (“CECL”)
standard; the lack of a significantly diversified loan portfolio and the concentration
in the South Florida market, including the risks of geographic,
depositor, and industry concentrations, including our concentration
in loans secured by real estate, in particular, commercial real
estate; the effects of climate change; the concentration of ownership of
our common stock; fluctuations in the price of our common stock;
our ability to fund or access the capital markets at attractive
rates and terms and manage our growth, both organic growth as
well as growth through other means, such as future acquisitions;
inflation, interest rate, unemployment rate, and market and monetary
fluctuations; impacts of international hostilities and geopolitical
events; increased competition and its effect on the pricing of our products
and services as well as our net interest rate spread and net
interest margin; the loss of key employees; the effectiveness
of our risk management strategies, including operational risks, including,
but not limited to, client, employee, or third-party fraud and
security breaches; and other risks described in this presentation and
other filings we make with the Securities and Exchange Commission
(“SEC”). All forward-looking statements are necessarily
only estimates of future results, and there can be no assurance that actual
results will not differ materially from expectations. Therefore,
you are cautioned not to place undue reliance on any forward-looking
statements. Further, forward-looking statements included in this
presentation are made only as of the date hereof, and we undertake
no obligation to update or revise any forward-looking statements
to reflect events or circumstances occurring after the date on which
the statements are made or to reflect the occurrence
of unanticipated events, unless required to do so under the federal securities
laws. You should also review the risk factors described
in the reports USCB Financial Holdings, Inc. filed or will file with
the SEC. Non-GAAP Financial Measures This presentation includes
financial information determined by methods other than in accordance
with generally accepted accounting principles (“GAAP”). This financial information
includes certain operating performance measures. Management
has included
these non-GAAP financial measures because it believes these
measures may provide useful supplemental information for evaluating
the Company’s expectations and underlying performance
trends. Further, management uses these measures in managing and evaluating
the Company’s business and intends to refer to them in
discussions about our operations and performance. Operating performance
measures should be viewed in addition to, and not as an alternative to
or substitute for, measures determined in accordance
with GAAP, and are not necessarily comparable to non-GAAP measures
that may be presented by other companies. Reconciliations of
these non-GAAP measures to the most directly comparable
GAAP measures can be found in the Non-GAAP financial measures reconciliation
tables included in this presentation. All numbers included in
this presentation are unaudited unless otherwise noted. 2
Q3 2024 HIGHLIGHTS GROWTH Average deposits increased
by $136.1 million or 7.0% compared to the third quarter 2023. Average
loans increased $267.4 million or 16.6% compared to the third quarter
- Liquidity sources as of September 30, 2024, aggregated $695
million in on-balance sheet and off-balance sheet sources.
Tangible book value per common share (a non-GAAP measure)
(1) on September 30, 2024 was $10.90 includes AOCI impact of
($1.94) increased $0.66 or 25.7% annualized from $10.24 in prior
quarter end which included an AOCI impact of ($2.62). PROFITABILITY
Net income was $6.9 million or $0.35 per diluted share,
an increase of $3.1 million or 82.0% compared to the third quarter
- Net interest income before provision increased $4.1 million
or 29.1% for the quarter compared to the third quarter 2023.
ROAA was 1.11% in the third quarter 2024 compared to 0.67%
for the third quarter 2023. ROAE was 13.38% in the third quarter
2024 compared to 8.19% for the third quarter 2023. CAPITAL/CREDIT
The Company’s Board of Directors declared a
cash dividend of $0.05 per share of the Company’s Class A common stock
on October 28, 2024. The dividend will be paid on December
5, 2024 to shareholders of record at the close of business on November
15, 2024. At September 30, 2024, four loans were classified as
nonaccrual for a total of $2.7 million. ACL coverage ratio was 1.19%
at September 30, 2024, and 1.16% at September 30, 2023. (1)
Non-GAAP financial measure. See reconciliation in this presentation.
3
HISTORICAL FINANCIALS EOP for Balance Sheet amounts Loans
(1) In millions $735 $1,931 2016 2017 2018 2019 2020 2021
2022 2023 Q1 Q2 Q3 2024 2024 2024 Deposits In millions $782
$2,127 2016 2017 2018 2019 2020 2021 2022 2023 Q1 Q2 Q3
2024 2024 2024 Total stockholders' equity In millions $86 $214
2016 2017 2018 2019 2020 2021 2022 2023 Q1 Q2 Q3 2024
2024 2024 ACL/Total Loans (2) 1.17% 1.19% 2016 2017 2018
2019 2020 2021 2022 2023 Q1 Q2 Q3 2024 2024 2024 Net charge
-offs ($1,019) ($6) 2016 2017 2018 2019 2020 2021 2022 2023
Q1 Q2 Q3 2024 2024 2024 Nonperforming Assets/Total
Assets 1.58% 0.11% 2016 2017 2018 2019 2020 2021 2022 2023
Q1 Q2 Q3 2024 2024 2024 Net Interest Income In millions
$30 $59 2016 2017 2018 2019 2020 2021 2022 2023 Q1 Q2 Q3
2024 2024 2024 Efficiency ratio 94.15% 53.16% 2016 2017 2018
2019 2020 2021 2022 2023 Q1 Q2 Q3 2024 2024 2024 PTPP
ROAA (3) 0.24% 1.62% 2016 2017 2018 2019 2020 2021 2022 2023
Q1 Q2 Q3 2024 2024 2024 (1) Loan amounts include deferred
fees/costs. (2) ACL was calculated under the CECL standard methodology
for all periods after January 1st 2023, and the incurred loss
methodology for all periods before. (3) Non-GAAP financial measure.
See reconciliation in this presentation. 4
FINANCIAL RESULTS In thousands (except per share
data) Q3 2024 Q2 2024 Q3 2023 Balance Sheet (EOP) Total
Securities $426,528 $406,050 $415,920 Total Loans (1) $1,931,362
$1,869,249 $1,676,520 Total Assets $2,503,954 $2,458,270
$2,244,602 Total Deposits $2,126,617 $2,056,702 $1,920,922
Total Equity (2) $213,916 $201,020 $182,884 Income Statement
Net Interest Income $18,109 $17,311 $14,022 Non-Interest
Income $3,438 $3,211 $2,161 Total Revenue $21,547 $20,522
$16,183 Provision for Credit Losses $931 $786 $653 Non-Interest
Expense $11,454 $11,560 $10,461 Net Income $6,949 $6,209
$3,819 Diluted Earning Per Share (EPS) $0.35 $0.31 $0.19 Weighted
Average Diluted Shares 19,825,211 19,717,167 19,611,897
(1) Loan amounts include deferred fees/costs. (2) Total Equity
includes accumulated comprehensive loss of $38.0 million for Q3 2024,
$44.7 million for Q2 2024, and $51.2 million for Q3 2023. 5
KEY PERFORMANCE INDICATORS Q3 2024 Q2 2024 Q3
2023 In thousands (except for TBV/share) GROWTH Total Assets
(EOP) $2,503,954 $2,458,270 $2,244,602 Total Loans (EOP)
$1,931,362 $1,869,249 $1,676,520 Total Deposits (EOP) $2,126,617
$2,056,702 $1,920,922 Tangible Book Value/Share
(1)(2) $10.90 $10.24 $9.36 PROFITABILITY Return On Average
Assets (ROAA) (3) 1.11% 1.01% 0.67% Return On Average
Equity (ROAE) (3) 13.38% 12.63% 8.19% Net Interest Margin (3) 3.03%
2.94% 2.60% Efficiency Ratio 53.16% 56.33% 64.64% Non
-Interest Expense/Avg Assets (3) 1.83% 1.88% 1.84% CAPITAL/CREDIT
Tangible Common Equity/Tangible Assets (1) 8.54%
8.18% 8.15% Total Risk-Based Capital (4) 13.22% 13.12%
13.10% NCO/Avg Loans (3) 0.00% 0.00% 0.00% NPA/Assets
0.11% 0.03% 0.02% Allowance for Credit Losses/Loans 1.19%
1.19% 1.16% (1) Non-GAAP financial measures. See reconciliation
in this presentation. (2) AOCI effect on tangible book value per
share was ($1.94) for Q3 2024, ($2.28) for Q2 2024 and ($2.62) for
Q3 2023. (3) Annualized. (4) Reflects the Company's regulatory
capital ratios which are provided for informational purposes only;
as a small bank holding company, the Company is not subject
to regulatory capital requirements. 6
DEPOSIT PORTFOLIO Deposits AVG In millions $1,941
$1,914 $2,049 $2,083 $2,078 $290 $282 $323 $316 $326 $1,011
$1,005 $1,098 $1,101 $1,085 $52 $50 $53 $56 $58 $588 $577 $575
$610 $609 Q3 2023 Q4 2023 Q1 2024 Q2 2024 Q3 2024 Non-interest
-bearing deposits Money market and savings Interest-bearing checking
deposits Time deposits Deposit Cost 2.39% 2.53% 2.76% 2.64%
2.66% Q3 2023 Q4 2023 Q1 2024 Q2 2024 Q3 2024 Commentary
Average deposits slightly decreased to $2,078 million
compared to the prior quarter and increased $136.1 million or 7.0%
compared to the third quarter 2023. DDA remained at 29% of
total average deposits. The quarterly average cost of deposits went up
2 bps during the third quarter of 2024 compared to the prior quarter;
however, the monthly average deposit cost for September 2024
was 2.57%. The monthly decrease in deposit cost was due to the
Company reducing Money Market rates in conjunction with the Fed
Funds decrease during the month. 7
LOAN PORTFOLIO Total Loans (AVG) In millions
2.39% 2.53% 2.76% 2.64% 2.66% Q3 2023 Q4 2023 Q1 2024
Q2 2024 Q3 2024 Loan Yields $1,611 $1,699 $1,782 $1,828
$1,878 Q3 2023 Q4 2023 Q1 2024 Q2 2024 Q3 2024 5.55% 5.79%
6.01% 6.16% 6.32% 0.02% 0.00% 0.00% 0.00% 0.00% 5.37%
5.79% 6.01% 6.16% 6.32% + 79 Q3'23 vs Q3'24 Q3 2023 Q4 2023
Q1 2024 Q2 2024 Q3 2024 Loan coupon Lona fees Commentary
Average loans increased $49.7 million or 10.8% annualized compared
to prior quarter and $267.4 million or 16.6% compared to the third quarter
- Loan coupon increased 16 bps compared to the prior
quarter and 79 bps compared to the third quarter 2023. 8
LOAN PRODUCTION Net Loan Production Trend In millions
8.00% 8.00% 8.16% 8.01% 7.75% $135 $55 $150 $46 $131 $91
$155 $108 $157 $83 Q3 2023 Q4 2023 Q1 2024 Q2 2024 Q3
2024 Loan Production/Line changes Loan Amortization/payoffs
New loans weighted average coupon Loan Composition Trend
EOP (1) In millions $948 $1,928 28% 15% 63% 57% 9% 28%
Jun-20 Sep-24 Residential real estate commercial real estate
Real Estate Loans Commercial and industrial, correspondent banks, and
Customer and other (1) Excludes deferred fees/cost. Commentary
$146.0 million in new loan production in the third quarter 2024. Weighted
average coupon on new loans was 7.75% for third quarter 2024,
143 bps above portfolio weighted average yield. Loan composition
shift from real estate loans to non-CRE loans is steadily increasing,
further diversifying our loan portfolio. 9
NET INTEREST MARGIN Net Interest Income/Margin (1) In thousands
(Except ratios) 2.60% 2.65% 2.62% 2.94% 3.03% $14,022
$14,376 $15,158 $17,311 $18,109 Q3 2023 Q4 2023 Q1 2024 Q2
2024 Q3 2024 Net Interest Income NIM Interest-Earning Assets
Mix (AVG) 4% 2% 5% 4% 3% 21% 19% 18% 19% 18%
75% 79% 77% 77% 79% Q3 2023 Q4 2023 Q1 2024 Q2 2024
Q3 2024 Total Loans Investment Securities Cash Balances
& Equivalents Commentary Net interest income increased
$798 thousand or 18.3% annualized compared to prior quarter and $4.1
million or 29.1% compared to the third quarter 2023. Net interest margin
increased 9 bps compared to prior quarter and 43 bps compared
to third quarter 2023. NIM drivers: Interest earning asset mix improving
at higher yields. Deposit cost remained stable. (1) Annualized. 10
INTEREST RATE SENSITIVITY Loan Portfolio Repricing
Profile by Rate Type Hybrid ARM 3% Fixed Rate 44% Variable
Rate 53% 23% 12% 65% Prime CMT SQFR Loan Repricing Schedule
Variable/Hybrid Rate Loans 29% 38% 12% 21% yrs.
1-2 yrs. 2-3 yrs. >3 yrs. Static NII Simulation Year 1
& 2 $4,000 $3,000 $2,000 $1,000 -100 +100 -100 +100 $0 -1.4% 0.7%
-5.5% 4.1% -$1,000 -$2,000 -$3,000 -$4,000 -$5,000 Net Interest
Income change from base ($ in thousands and % change) 11
ASSET QUALITY Allowance for Credit Losses In thousands (except
ratios) 1.16% 1.18% 1.18% 1.19% 1.19% $19,493 $21,084 $21,454 $22,230
$23,067 Q3 2023 Q4 2023 Q1 2024 Q2 2024 Q3 2024 Allowance
for credit losses ACL/Total loans Non-performing Loans In
thousands (except ratios) 0.03% 0.03% 0.03% 0.04% 0.14% $479 $468
$456 $759 $2,725 Q3 2023 Q4 2023 Q1 2024 Q2 2024 Q3 2024
Non-accrual loans Non-performing loans to total loans Classified
Loans (1) to Total Loans 0.27% 0.53% 0.44% 0.45% 0.36% Q3
2023 Q4 2023 Q1 2024 Q2 2024 Q3 2024 Commentary Allowance
for credit losses increased $837 thousand compared to prior quarter
and $3.6 million compared to third quarter 2023. ACL coverage
ratio was at 1.19% as of September 30, 2024. One C&I loan for $420 thousand,
one consumer loan for $1,991 thousand, and one residential real
estate loan for $314 thousand were classified as nonaccrual
as of September 30, 2024. (1) Loans classified as substandard at period end.
No loans classified
doubtful at all the dates presented. 12
LOAN PORTFOLIO MIX Loan Portfolio Mix (1) 10% 15% 10% 47%
13% 5% $1,928 MM(1) Residential real estate CRE – Owner
occupied CRE – Non-owner occupied Commercial and industrial
Correspondent banks Consumer and other Commentary Total loan
balance at quarter end was $1,928 million (1). Commercial
Real Estate (owner occupied and non-owner occupied) was 57%
or $1,095 million of the total loan portfolio(1). CRE mix is diversified
and granular. Retail non-owner occupied makes up 27%
of total CRE or $297.1 million. CRE Loan Mix Land/Construction
3% Other 3% Retail 27% Multifamily 18% CRE - Owner Occupied
17% Office 11% Warehouse 12% Hotels 9% $1,095MM
As of 9/30/24 Excludes deferred fees/cost Includes loan types: office,
warehouse, retail, and other CRE Loan Portfolio (non-owner
occupied and owner occupied) Weighted Average Loan
Type Outstanding Balance (1) LTV (2) DSCR (3) Average
Loan Size (1) Retail $316 57% 1.53 $3.0 Multifamily $203 56% 1.33
$1.6 Office $182 56% 1.94 $1.5 Warehouse $187 57% 2.25
$1.6 Hotel $96 59% 2.23 $4.8 Other $75 57% 2.07 $1.7 Land/Construction
$36 45% NA $2.1 (1) Balance in millions. Excludes deferred
fees/cost. (2) LTV - Loan to value ratio. (3) DSCR - Debt service
coverage ratio. 13
CRE OFFICE PORTFOLIO Owner Occupied Office by Business Type
In Millions as of 9/30/2024 $19.2 30% $16.4 25% $24.8 38%
$4.4 7% Medical/Dental Other Professional Other <$1MM Commentary
Total office loan portfolio (owner occupied and non-owner
occupied) had 120 notes with an average balance of $1.5 million, LTV
of 56%, and DSCR of 1.94X at quarter end. The largest business
type in the office portfolio is multi-tenant with 46% of the portfolio.
South Florida’s office sector outperforms the national average
with a lower vacancy rate of 12% and with a positive net absorption for
three straight years as of Q1 2024. All three major markets
within South Florida were ranked in the top 10 nationally for
year-over-year rent growth. (1) Non-Owner Occupied Office
by Business Type $12.1 11% $83.0 71% $16.3 14% $4.9 4% Multi-Tenant
Medical/Dental Other <$1MM Office Loan Portfolio Maturities and
Repricing < 1 year 1 year to 3 years 3 years to 5 years
5 years to 10 years > 10 years 11% 28% 49% 12% 0% CRE Office
Key Metrics As of 9/30/240 Avg. Loan Size in millions $1.5
NCOs / Average Loans 0.00% Delinquencies / Loans 0.00% Nonaccruals
/ Loans 0.00% Classified Loans / Loans 0.00% (1) Data points source:
CBRE, a NYSE-listed and worldwide commercial real estate services
& investment company with clients in 100+ countries, including over
95% of the Fortune 100. Published March 2024. 14
NON-INTEREST INCOME In thousands (except ratios) Q3 2024 Q2
2024 Q1 2024 Q4 2023 Q3 2023 Total service fees
$2,544 $1,977 $1,651 $1,348 $1,329 Wire fees $563 $557 $521 $518
$502 Swap fees $1,285 $650 $285 $16 $97 Other $696 $770 $845
$814 $730 Gain (loss)
on sale of securities available for sale - 14 - (883) (955) Gain
on sale of loans held for sale 109 417 67 105 255 Other income
785 803 746 756 1,532 Total non-interest income $3,438
$3,211 $2,464 $1,326 $2,161 Average total assets $2,485,434
$2,479,222 $2,436,103 $2,268,811 $2,250,258 Non-interest income/Average
assets (1) 0.55% 0.52% 0.41% 0.23% 0.38% Commentary Service fees
increased year over year due to loan swap fees and wire fees.
Gain on sale of SBA 7a loans represent $109 thousand for the third quarter
- Non-interest income is 16.0% of total revenue for third quarter
2024 and 0.55% to average assets; both metrics are higher than prior
quarters. (1) Annualized. 15
NON-INTEREST EXPENSE In thousands (except ratios) Q3 2024 Q2
2024 Q1 2024 Q4 2023 Q3 2023 Salaries and employee benefits
$7,200 $7,353 $6,310 $6,104 $6,066 Occupancy 1,341 1,266 1,314
1,262 1,350 Regulatory assessments and fees 452 476 433
412 365 Consulting and legal fees 161 263 592 642 513 Network and
information technology services 513 479 507 552 481 Other operating
expense 1,787 1,723 2,018 1,747 1,686 Total non-interest
expense $11,454 $11,560 $11,174 $10,719 $10,461 Efficiency
ratio 53.16% 56.33% 63.41% 68.27% 64.64% Average
total assets $2,485,434 $2,479,222 $2,436,103 $2,268,811 $2,250,258
Non-interest expense / Average assets (1) 1.83% 1.88%
1.84% 1.87% 1.84% Full-time equivalent employees 198 197 199
196 194 Commentary Salaries and benefits decreased
$153 thousand compared to the prior quarter due to higher incentives paid
in the second quarter 2024. Consulting and legal fees decreased
$102 thousand compared to the prior quarter due to reimbursement of legal
expenses. Non-interest expense to average assets remained under 2%
for all periods. Efficiency ratio improved for the third quarter
2024 primarily due to strong growth in non-interest income and a
slight decrease in non-interest expenses. (1) Annualized. 16
CAPITAL Capital Ratios Q3 2024 Q2 2024 Q3 2023 Well-Capitalized
Leverage Ratio 9.34% 9.03% 9.26% 5.00% TCE/TA 8.54%
8.18% 8.15% NA Tier 1 Risk-Based Capital 12.01% 11.93% 11.97%
8.00% Total Risk - Based Capital 13.22% 13.12% 13.10%
10.00% AOCI ($38.0) ($44.7) ($51.2) In Millions Commentary The
Company paid in September 2024 a cash dividend of $0.05 per
share of the Company’s Class A common stock; the aggregate
distributed dividend amount was $1.0 million. During the quarter,
the Company repurchased 10,000 shares of common stock at a
weighted average cost per share of $12.03. 537,980 shares remained
authorized for repurchase under the Company’s share repurchase
programs at September 30, 2024. Q3 2024 EOP common stock shares
outstanding: 19,620,632. (1) Reflects the Company's regulatory capital
ratios which are provided for informational purposes only; as a
small bank holding company, the Company is not subject to regulatory
capital requirements. (2) Non-GAAP financial measures. See reconciliation
in this presentation. 17
TAKEAWAYS Leading franchise located in
one of the most attractive banking markets in Florida and the U.S.
Robust organic growth Strong asset quality, with minimal
charge-offs experienced since 2015 recapitalization Experienced
and tested management team Strong profitability, with pathway
for future enhancement identified Core funded deposit base
with 30% non-interest-bearing deposits (EOP) 18
APPENDIX - NON-GAAP RECONCILIATION APPENDIX
- NON-GAAP RECONCILIATION In thousands (except
ratios) Pre-tax pre-provision ("PTPP") income: Net income
Plus: Provision for income taxes Plus: Provision for credit losses
PTPP income PTPP return on average as sets: As of or For the
Three Months Ended 9/30/2024 6/30/2024 3/31/2024 12/31/2023 9/30/2023
$ 6,949 $ 6,209 $ 2,213 1,987 4,812
$ 1,428 2,721 $ 3,819 787 1,250 931 786 410 1,475 853 10,093
8,982 $ 6,448 $ 4,983 $ 5,722 (1) PTPP in come Average
assets PTPP return on average assets $ 10,093 $ 8,962 $ 8,448
$ 4,983 $ 5,722 $ 2,485,434 $ 2,479,222 $ 2,438,103 $ 2,288,811
$ 2,250,258 (2) 1.62% 1.45% 1.08% 0.87% 1.01% Operating net
income: Net income Less: Net gains (losses) on sale of securities Less:
Tax effect on sale of securities Operating net income
(1) $ 6,949 $ 6,209 $ 4,812 $ 2,721 $ 3,819 14 (883) (955) (4)
224 242 $ 6,949 $ 6,199 $ 4,812 $ 3,380 $ 4,532 Operating PTPP income:
PTPP in come (1) $ 10,093 $ 8,982 $ 6,448 $ 4,983 $ 5,722 Less: Net
gains (losses) on sale of securities Operating PTPP in come
14 (883) (955) $ 10,093 $ 8,948 $ 6,448 5,886 $ 6,677 Operating
PTPP return on average as sets: (1) Operating PTPP income $
10,093 $ 8,948 Average assets $ 2,485,434 $ Operating PTPP
return on average assets (2) 1.62% 2,479,222 1.45% $ $ 2,438,103
1.08% 8,448 $ 5,886 $ 6,677 $ 2,268,811 1.03% $ 2,250,258
1.18% Operating return on average as sets: (1) Operating net
income 6,949 6,199 4,812 $ Average assets Operating return on average
assets (2) $ 2,485,434
1.11% $ 2,479,222 1.01% $ 2,438,103 $ 0.76% 3,380 2,288,811
0.59% 4,532 $ 2,250,258 0.80% Operating return on average
equity: (1) Operating net income Average equity 19 19 Operating return
on average equity (2) 6,949 $ 206,641 6,199 $ $ 197,755 $ 13.38%
12.81% 4,812 $ 193,092 $ 9.61% 3,380 $ 183,629 7.30%
$ 4,532 184,901 9.72% Operating Revenue: (1) Net interest income $ Non
-interest income 18,109 $ 3,438 17,311 $ Less: Net gains (losses)
on sale of securities 3,211 14 15,158 $ 2,484 14,376 5 14,022
1,326 2,161 (883) (955) Operating revenue 21,547 $ 20,508 $ 17,822
$ 16,585 $ 17,138 Operating Efficiency Ratio: Total non-interest
expense Operating revenue Operating efficiency rato $ 11,454
$ 21,547 $ 53.16% 11,560 $ 20,508 $ 56.37% 11,174 $ 17,822
$ 63.41% 10,719 $ 10,461 16,585 $ 64.63% 17,138 61.04% (1)
The Company believes these non-GAAP measurements are key indicators
of the ongoing earnings power of the Company. 19 (2) Annualized.
19
APPENDIX - NON-GAAP RECONCILIATION In thousands
(except ratios and share data) 9/30/2024 3/31/2024 As of or For
the Three Months Ended 6/30/2024 12/31/2023 9/30/2023 Tangible
book value per common share (at period-end): (1) Total stockholders'
equity $ 213,916 $ 201,020 $ 195,011 $ 191,968 $ 182,884
Less: Intangible assets Tangible stockholders' equity Total
common shares issued and outstanding $ 213,916 $ 201,020 $ 195,011
S 191,968 $ 182,884 Total shares issued and outstanding (at period-end):
19,620,632 19,630,632 19,650,463 19,575,435 19,542,290 Tangible
book value per common share (2) $ 10.90 $ 10.24 $ 9.92 $ 9.81
$ 9.36 Operating diluted net income per common share: (1) Operating
net income $ 6,949 $ 6,199 $ Total weighted average
diluted shares of common stock 19,825,211 19,717,167 4,612 $ 19,698,258
19,573,350 Operating diluted net income per common share:
$ 0.35 $ 0.31 $ 0.23 $ 3,380 $ 4,532 19,611,897 0.17 $ 0.23 Tangible
Common Equity/Tangible Assets (1) Tangible stockholders'
equity $ Tangible total assets (3) $ Tangible Common Equity/Tangible
Assets 213,916 $ 2,503,954 $ 8.54% 201,020 $ 2,458,270 $ 8.18%
195,011 $ 2,489,142 $ 7.83% 191,968 $ 2,339,093 $ 8.21% 182,884
2,244,602 8.15% (1) The Company believes these non-GAAP
measurements are key indicators of the ongoing earnings power
of the Company. (2) Excludes the dilutive effect, if any,
of shares of common stock issuable upon exercise of outstanding
stock options. (3) Since the Company has no intangible assets, tangible
total assets is the same amount as total assets calculated under
GAAP. 20
CONTACT INFORMATION LOU DE LA AGUILERA
Chairman, President & CEO (305) 715-5186 laguilera@uscentury.com
ROB ANDERSON EVP, Chief Financial Officer (305)
715-5393 rob.anderson@uscentury.com INVESTOR RELATIONS
InvestorRelations@uscentury.com 21