1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
__________________________
FORM
__________________________
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
__________________________
(Exact name of Registrant as Specified in Its Charter)
(State or Other Jurisdiction
of Incorporation)
(Commission File Number)
(IRS Employer
Identification No.)
,
,
(Address of Principal Executive Offices)
(Zip Code)
Registrant’s Telephone Number, Including Area Code: (
)
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:
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Trading
Symbol(s)
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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933
(§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b -2 of this chapter).
Emerging growth company
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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for
complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
☐
2
Item 2.02. Results of Operations and Financial Condition.
On July 28, 2022, USCB Financial Holdings, Inc. (the “Company”), issued a press release announcing its financial results for
the second quarter ended June 30, 2022. A copy of the press release is furnished as Exhibit 99.1 to this Current Report on 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.
Item 7.01. Regulation FD Disclosure.
As previously announced, at 9:00 a.m. ET on July 29, 2022, the Company will hold an earnings conference call to discuss its
financial performance for the quarter ended June 30, 2022. A copy of the slides forming the basis of the presentation is being furnished
as Exhibit 99.2 to this Current Report on 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 Exhibits 99.1 and 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.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
Exhibit No.
Description
104
Cover Page Interactive Data File (embedded within the Inline XBRL document)
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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: July 28, 2022
1
Exhibit 99.1
EARNINGS RELEASE
USCB Financial Holdings, Inc. Reports Second Quarter 2022 Results
MIAMI – July 28, 2022 – USCB Financial Holdings, Inc. (the “Company”) (NASDAQ: USCB)
, the holding company for U.S.
Century Bank, reported net income of $5.3 million or $0.26 per diluted share for the three months ended June 30, 2022, compared with
net income of $4.1 million or $0.64 and $0.13 per diluted share for Class A and Class B common stock, respectively, for the same period
in 2021. On December 21, 2021, the Company agreed to exchange all the outstanding shares of Class B common stock for Class
A
common stock at a ratio of 1 share of Class A common stock for each 5 shares of Class B common stock. As of December 31, 2021, the
Company’s only class of securities issued and outstanding was Class A common stock.
“Second quarter results demonstrated continued solid performance by our USCB team members. Total assets exceeded $2.0 billion for
the first time, loans grew 19.9% from June 30, 2021, our net interest margin expanded to 3.37%, operating expenses remained in line
with an efficiency ratio of 55.34%, and credit quality remains pristine. We are pleased with our profitability metrics and believe we will
be able to continue to successfully execute on our strategy that delivers improved performance in the years to come.” said Luis de la
Aguilera, President and Chief Executive Officer.
Unless otherwise stated, all percentage comparisons in the bullet points below are calculated for the quarter ended June 30, 2022
compared to the quarter ended June 30, 2021 and annualized where appropriate.
Profitability
•
Annualized return on average assets for the quarter ended June 30, 2022 was 1.08% compared to 0.98% for the second quarter of
2021.
•
Annualized return on average stockholders’ equity for the quarter ended June 30, 2022 was 11.38 % compared to 9.74% for the
second quarter of 2021.
•
The efficiency ratio for the quarter ended June 30, 2022 was 55.34% an improvement as compared to 62.00% for the second quarter
of 2021.
•
Net interest margin increased to 3.37% for the quarter ended June 30, 2022 compared to 3.14% for the second quarter of 2021.
•
Net interest income before provision for credit losses was $15.6 million for the quarter ended June 30, 2022, an increase of
$3.2 million or 25.4% compared to the second quarter of 2021. The increase was primarily driven by higher loan and investment
securities income.
Balance Sheet
•
Total assets were $2.0 billion at June 30, 2022, representing an increase of $349.1 million or 20.9% from June 30, 2021.
•
Total loans were $1.4 billion at June 30, 2022, representing an increase of $227.6 million or 19.9% from June 30, 2021.
•
Total deposits were $1.7 billion at June 30, 2022, representing an increase of $299.9 million or 20.8% from June 30, 2021.
•
Total stockholders’ equity was $180.1 million at June 30, 2022, representing an increase of $13.8 million or 8.3% from June 30,
2021.
Asset Quality
•
The allowance for credit losses increased by $938 thousand to $15.8 million at June 30, 2022 from $14.9 million at June 30, 2021.
•
The allowance for credit losses represented 1.15% of total loans at June 30, 2022 compared to 1.30% at June 30, 2021.
•
Non-performing loans to total loans was 0.00% at June 30, 2022 and 2021.
2
Non-interest Income and Non-interest Expense
•
Non-interest income was $1.6 million for the three months ended June 30, 2022, an increase of $101 thousand or 6.7% compared
to the same period in 2021.
•
Non-interest expense was $9.6 million for the three months ended June 30, 2022 compared to $8.7 million for the same period in
2021, an increase of $877 thousand or 10.1%. The increase was primarily driven by higher salaries and employee benefits due to
new hires and salary compensation.
Capital
•
The Company and its wholly owned subsidiary, U.S. Century Bank (the “Bank”), exceeded all regulatory capital requirements and
remained significantly above “well-capitalized” guidelines. As of June 30, 2022,
total risk-based capital ratios for the Company and
the Bank were 13.74% and 13.67%, respectively.
Conference Call and Webcast
The Company will host a conference call on Friday, July 29, 2022, at 9:00 a.m. Eastern Time to discuss the Company’s unaudited
financial results for the quarter ended June 30, 2022. To access the conference call, dial (866) 374-5140 (U.S. toll-free) and use
conference code 31578788.
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 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. The
words “may,” “will,” “anticipate,” “should,” “would,” “believe,” “contemplate,” “expect,” “aim,” “plan,” “estimate,” “continue,” and
“intend,” as well as other similar words and expressions of the future, are intended to identify forward-looking statements. These
forward-looking statements include 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 results of operations and financial
condition from expected developments or events, or business and growth strategies, including anticipated internal growth.
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;
•
the continuation of the COVID-19 pandemic and its impact on us, our employees, customers and third-party service providers, and
the ultimate extent of the impacts of the pandemic and related government stimulus programs;
•
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 environment;
•
our ability to comply with the extensive laws and regulations to which we are subject, including the laws for each jurisdiction where
we operate;
•
legislative or regulatory changes and changes in accounting principles, policies, practices or guidelines, including the effects of the
forthcoming implementation of the Current Expected Credit Losses (“CECL”) standard;
•
the effects of our lack of a diversified loan portfolio and concentration in the South Florida market, including the risks of geographic,
depositor, and industry concentrations, including our concentration in loans secured by real estate;
•
the concentration of ownership of our Class A common stock;
•
fluctuations in the price of our Class A common stock;
3
•
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, market, and monetary fluctuations;
•
increased competition and its effect on the pricing of our products and services as well as our interest rate margin;
•
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 statement is 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 and, for periods prior to the completion of the bank holding
company reorganization in December 2021, the Bank filed with the FDIC.
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
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. To the extent applicable, 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.
You should assume that all numbers are unaudited unless otherwise noted.
Contacts:
Investor Relations
InvestorRelations@uscentury.com
Media Relations
Martha Guerra-Kattou
MGuerra@uscentury.com
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USCB FINANCIAL HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
(Dollars in thousands, except per share data)
Three Months Ended June 30,
Six Months Ended June 30,
2022
2021
2022
2021
Interest income:
Loans, including fees
$
14,053
$
11,538
$
27,035
$
23,406
Investment securities
2,510
1,968
4,839
3,812
Interest-bearing deposits in financial institutions
121
23
152
39
Total interest income
16,684
13,529
32,026
27,257
Interest expense:
Interest-bearing deposits
17
15
33
29
Savings and money markets accounts
615
523
1,166
1,071
Time deposits
271
379
530
933
Federal Home Loan Bank advances
139
138
276
275
Total interest expense
1,042
1,055
2,005
2,308
Net interest income before provision for credit losses
15,642
12,474
30,021
24,949
Provision for credit losses
705
-
705
(160)
Net interest income after provision for credit losses
14,937
12,474
29,316
25,109
Non-interest income:
Service fees
1,083
903
1,983
1,792
Gain (loss) on sale of securities available for sale, net
(3)
187
18
249
Gain on sale of loans held for sale, net
22
23
356
987
Loan settlement
-
-
161
-
Other non-interest income
515
403
1,044
809
Total non-interest income
1,617
1,516
3,562
3,837
Non-interest expense:
Salaries and employee benefits
5,913
5,213
11,788
10,491
Occupancy
1,251
1,411
2,521
2,798
Regulatory assessment and fees
226
195
439
373
Consulting and legal fees
398
373
915
558
Network and information technology services
448
332
835
840
Other operating expense
1,315
1,150
2,665
2,291
Total non-interest expense
9,551
8,674
19,163
17,351
Net income before income tax expense
7,003
5,316
13,715
11,595
Income tax expense
1,708
1,263
3,566
2,761
Net income
5,295
4,053
10,149
8,834
Preferred stock dividend
-
754
-
1,535
Net income available to common stockholders
$
5,295
$
3,299
$
10,149
$
7,299
Allocation of net income per common stock class:
(1)
Class A
$
5,295
$
2,509
$
10,149
$
5,551
Class B
$
-
$
790
$
-
$
1,747
Per share information:
(1)
Class A common stock
(2)
Net income per share, basic
$
0.26
$
0.65
$
0.51
$
1.43
Net income per share, diluted
$
0.26
$
0.64
$
0.50
$
1.41
Class B common stock
Net income per share, basic
$
-
$
0.13
$
-
$
0.29
Net income per share, diluted
$
-
$
0.13
$
-
$
0.29
Weighted average shares outstanding:
Class A common stock
(2)
Basic
20,000,753
3,889,469
19,997,869
3,889,469
Diluted
20,171,261
3,933,636
20,192,918
3,933,636
Class B common stock
Basic
-
6,121,052
-
6,121,052
Diluted
-
6,121,052
-
6,121,052
(1) For the three and six months ended June 30, 2021, the allocation of net income available to common stockholders was based on the weighted average shares
outstanding per common share class to the total weighted average shares outstanding during the period. The income allocation is calculated using the weighted average
shares outstanding of Class B common stock on an as-converted basis (20% per share equivalent to Class A common stock).
(2) For the three and six months ended June 30, 2021, the common stock outstanding, weighted average shares and net income per share for the Class A common stock
have been adjusted to reflect the 1 for 5 reverse stock split that occurred in June 2021.
5
USCB FINANCIAL HOLDINGS, INC.
SELECTED FINANCIAL DATA (UNAUDITED)
(Dollars in thousands, except per share data)
As of or For the Three Months Ended
6/30/2022
3/31/2022
12/31/2021
9/30/2021
6/30/2021
Income statement data:
Net interest income
$
15,642
$
14,379
$
14,076
$
13,471
$
12,474
Provision for credit losses
705
-
-
-
-
Net interest income after provision for credit losses
14,937
14,379
14,076
13,471
12,474
Service fees
1,083
900
961
856
903
Gain (loss) on sale of securities available for sale, net
(3)
21
35
(70)
187
Gain on sale of loans held for sale, net
22
334
107
532
23
Gain on sale of other assets
-
-
983
-
-
Loan settlement
-
161
-
2,500
-
Other income
515
529
558
399
403
Total non-interest income
1,617
1,945
2,644
4,217
1,516
Salaries and employee benefits
5,913
5,875
5,634
5,313
5,213
Occupancy
1,251
1,270
1,267
1,192
1,411
Regulatory assessment and fees
226
213
93
317
195
Consulting and legal fees
398
517
539
357
373
Network and information technology services
448
387
268
358
332
Other operating expense
1,315
1,350
1,518
1,470
1,150
Total non-interest expenses
9,551
9,612
9,319
9,007
8,674
Net income before income tax expense
7,003
6,712
7,401
8,681
5,316
Income tax expense
1,708
1,858
1,751
2,088
1,263
Net income
5,295
4,854
5,650
6,593
4,053
Preferred stock dividend
-
-
-
542
754
Exchange and redemption of preferred shares
-
-
-
89,585
-
Net income (loss) available to common stockholders
$
5,295
$
4,854
$
5,650
$
(83,534)
$
3,299
Allocation of net income (loss) per common stock class:
(1)
Class A
$
5,295
$
4,854
$
5,650
$
(77,278)
$
2,509
Class B
$
-
$
-
$
-
$
(6,256)
$
790
Per share information:
Class A common stock
(2)
Net income (loss) per share, basic
$
0.26
$
0.24
$
0.30
$
(5.11)
$
0.65
Net income (loss) per share, diluted
$
0.26
$
0.24
$
0.30
$
(5.11)
$
0.64
Class B common stock
Net income (loss) per share, basic
$
-
$
-
$
-
$
(1.02)
$
0.13
Net income (loss) per share, diluted
$
-
$
-
$
-
$
(1.02)
$
0.13
Balance sheet data (at period-end):
Cash and cash equivalents
$
83,272
$
94,113
$
46,228
$
69,597
$
47,117
Securities available-for-sale
$
339,464
$
392,214
$
401,542
$
328,171
$
395,804
Securities held-to-maturity
$
116,671
$
122,361
$
122,658
$
99,866
$
-
Total securities
$
456,135
$
514,575
$
524,200
$
428,037
$
395,804
Loans held for investment
(3)
$
1,372,733
$
1,258,388
$
1,190,081
$
1,176,412
$
1,145,095
Allowance for credit losses
$
(15,786)
$
(15,074)
$
(15,057)
$
(14,900)
$
(14,848)
Total assets
$
2,016,086
$
1,967,252
$
1,853,939
$
1,755,011
$
1,667,005
Non-interest-bearing deposits
$
653,708
$
656,622
$
605,425
$
570,091
$
555,993
Interest-bearing deposits
$
1,085,012
$
1,056,672
$
984,954
$
914,498
$
882,783
Total deposits
$
1,738,720
$
1,713,294
$
1,590,379
$
1,484,589
$
1,438,776
Federal Home Loan Bank advances and other borrowings
$
66,000
$
36,000
$
36,000
$
36,000
$
36,000
Total liabilities
$
1,836,018
$
1,775,213
$
1,650,042
$
1,553,093
$
1,500,703
Total stockholders' equity
$
180,068
$
192,039
$
203,897
$
201,918
$
166,302
Capital ratios:
(4)
Leverage ratio
9.43%
9.47%
9.55%
9.69%
7.91%
Common equity tier 1 capital
12.65%
13.35%
13.70%
13.85%
9.24%
Tier 1 risk-based capital
12.65%
13.35%
13.70%
13.85%
11.44%
Total risk-based capital
13.74%
14.49%
14.92%
15.10%
12.69%
(1) The allocation of net income (loss) available to common stockholders was based on the weighted average shares outstanding per common share class to the total
weighted average shares outstanding during each period. The income (loss) allocation is calculated using the weighted average shares outstanding of Class B common
stock on an as-converted basis (20% per share equivalent to Class A common stock).
(2) The quarter ended June 30, 2021 was adjusted for the 1 for 5 reverse stock split.
(3) Loan amounts include deferred fees/costs.
(4) The Company was formed during the quarter ended December 31, 2021. As such, the capital ratios for Q2 2022, Q1 2022 and Q4 2021 are for the Company and for
Q3 2021 and prior are for the Bank. The Company, as a small bank holding company, is not subject to regulatory capital requirements.
6
USCB FINANCIAL HOLDINGS, INC.
AVERAGE BALANCES, RATIOS, AND OTHER (UNAUDITED)
(Dollars in thousands)
As of or For the Three Months Ended
6/30/2022
3/31/2022
12/31/2021
9/30/2021
6/30/2021
Average balance sheet data:
Cash and cash equivalents
$
80,254
$
99,911
$
87,819
$
116,622
$
108,028
Securities available-for-sale
$
370,933
$
385,748
$
374,589
$
346,407
$
382,990
Securities held-to-maturity
$
120,130
$
122,381
$
114,108
$
51,238
$
-
Total securities
$
491,063
$
508,129
$
488,697
$
397,645
$
382,990
Loans held for investment
(1)
$
1,296,476
$
1,211,432
$
1,158,755
$
1,144,275
$
1,088,492
Total assets
$
1,968,381
$
1,913,484
$
1,828,037
$
1,741,423
$
1,660,060
Interest-bearing deposits
$
1,071,709
$
1,023,844
$
958,241
$
912,330
$
896,271
Non-interest-bearing deposits
$
644,975
$
626,400
$
603,735
$
564,928
$
535,894
Total deposits
$
1,716,684
$
1,650,244
$
1,561,976
$
1,477,258
$
1,432,165
Federal Home Loan Bank advances and other borrowings
$
36,330
$
36,011
$
36,000
$
36,000
$
36,000
Total liabilities
$
1,781,784
$
1,711,624
$
1,625,675
$
1,546,414
$
1,493,129
Total stockholders' equity
$
186,597
$
201,860
$
202,362
$
195,009
$
166,931
Performance ratios:
Return on average assets
(2)
1.08%
1.03%
1.23%
1.50%
0.98%
Return on average equity
(2)
11.38%
9.75%
11.08%
13.41%
9.74%
Net interest margin
(2)
3.37%
3.22%
3.19%
3.19%
3.14%
Non-interest income to average assets
(2)
0.33%
0.41%
0.57%
0.96%
0.37%
Efficiency ratio
(3)
55.34%
58.88%
55.74%
50.92%
62.00%
Loans by type (at period end):
(4)
Residential real estate
$
203,662
$
204,317
$
201,359
$
201,124
$
213,575
Commercial real estate
$
843,445
$
782,072
$
704,988
$
693,469
$
673,944
Commercial and industrial
$
131,271
$
134,832
$
146,592
$
137,486
$
155,440
Foreign banks
$
84,770
$
63,985
$
59,491
$
58,839
$
62,042
Consumer and other
$
109,250
$
73,765
$
79,229
$
87,515
$
43,979
Asset quality data:
Allowance for credit losses to total loans
1.15%
1.20%
1.27%
1.27%
1.30%
Allowance for credit losses to non-performing loans
- %
- %
1,265%
82,778%
74,240%
Non-accrual loans less non-accrual TDRs
-
-
1,190
-
-
Non-accrual TDRs
-
-
-
18
20
Loans- over 90 days past due and accruing
-
-
-
-
-
Total non-performing loans
(5)
-
-
1,190
18
20
Non-performing loans to total loans
- %
- %
0.10%
0.00%
0.00%
Non-performing assets to total assets
- %
- %
0.06%
0.00%
0.00%
Net charge-offs (recoveries of) to average loans
(2)
(0.00)%
(0.01)%
(0.05)%
(0.02)%
0.06%
Net charge-offs (recovery of) credit losses
(7)
(17)
(157)
(51)
160
Interest rates and yields:
(2)
Loans
4.35%
4.35%
4.32%
4.29%
4.19%
Investment securities
2.04%
1.85%
1.81%
1.86%
2.04%
Total interest-earning assets
3.60%
3.43%
3.41%
3.43%
3.41%
Deposits
0.21%
0.20%
0.21%
0.22%
0.26%
Borrowings and repurchase agreements
1.53%
1.54%
1.51%
1.52%
1.52%
Total interest-bearing liabilities
0.38%
0.37%
0.38%
0.40%
0.45%
Other information:
Full-time equivalent employees
192
190
187
184
183
(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 for the dates presented since there were no impaired investments or other
real estate owned (OREO) recorded.
7
USCB FINANCIAL HOLDINGS, INC.
NET INTEREST MARGIN (UNAUDITED)
(Dollars in thousands)
Three Months Ended June 30,
2022
2021
Average
Balance
Interest
Yield/Rate
(1)
Average
Balance
Interest
Yield/Rate
(1)
Assets
Interest-earning assets:
Loans
(2)
$
1,296,476
$
14,053
4.35%
$
1,088,492
$
11,538
4.19%
Investment securities
(3)
493,352
2,510
2.04%
385,090
1,968
2.04%
Other interest-earnings assets
69,503
121
0.70%
101,134
23
0.09%
Total interest-earning assets
1,859,331
16,684
3.60%
1,574,716
13,529
3.41%
Non-interest-earning assets
109,050
85,344
Total assets
$
1,968,381
$
1,660,060
Liabilities and stockholders' equity
Interest-bearing liabilities:
Interest-bearing demand deposits
$
66,349
17
0.10%
$
52,620
15
0.11%
Saving and money market deposits
781,076
615
0.32%
607,752
523
0.35%
Time deposits
224,284
271
0.48%
235,899
379
0.65%
Total interest-bearing deposits
1,071,709
903
0.34%
896,271
917
0.41%
Borrowings and repurchase agreements
36,330
139
1.53%
36,000
138
1.52%
Total interest-bearing liabilities
1,108,039
1,042
0.38%
932,271
1,055
0.45%
Non-interest-bearing demand deposits
644,975
535,894
Other non-interest-bearing liabilities
28,770
24,964
Total liabilities
1,781,784
1,493,129
Stockholders' equity
186,597
166,931
Total liabilities and stockholders' equity
$
1,968,381
$
1,660,060
Net interest income
$
15,642
$
12,474
Net interest spread
(4)
3.22%
2.96%
Net interest margin
(5)
3.37%
3.14%
(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 on total interest-earning assets minus the average rate 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
6/30/2022
3/31/2022
12/31/2021
9/30/2021
6/30/2021
Pre-tax pre-provision ("PTPP") income:
Net income
$
5,295
$
4,854
$
5,650
$
6,593
$
4,053
Plus: Provision for income taxes
1,708
1,858
1,751
2,088
1,263
Plus: Provision for credit losses
705
-
-
-
-
PTPP income
$
7,708
$
6,712
$
7,401
$
8,681
$
5,316
PTPP return on average assets:
PTPP income
$
7,708
$
6,712
$
7,401
$
8,681
$
5,316
Average assets
$
1,968,381
$
1,913,484
$
1,828,037
$
1,741,423
$
1,660,060
PTPP return on average assets
(1)
1.57%
1.42%
1.61%
1.98%
1.28%
Operating net income:
Net income
$
5,295
$
4,854
$
5,650
$
6,593
$
4,053
Less: Net gains (losses) on sale of securities
(3)
21
35
(70)
187
Less: Tax effect on sale of securities
1
(5)
(9)
17
(46)
Operating net income
$
5,297
$
4,838
$
5,624
$
6,646
$
3,912
Operating PTPP Income:
PTPP income
$
7,708
$
6,712
$
7,401
$
8,681
$
5,316
Less: Net gains (losses) on sale of securities
(3)
21
35
(70)
187
Operating PTPP income
$
7,711
$
6,691
$
7,366
$
8,751
$
5,129
Operating PTPP return on average assets:
Operating PTPP income
$
7,711
$
6,691
$
7,366
$
8,751
$
5,129
Average assets
$
1,968,381
$
1,913,484
$
1,828,037
$
1,741,423
$
1,660,060
Operating PTPP return on average assets
(1)
1.57%
1.42%
1.60%
1.99%
1.24%
Operating return on average assets:
Operating net income
$
5,297
$
4,838
$
5,624
$
6,646
$
3,912
Average assets
$
1,968,381
$
1,913,484
$
1,828,037
$
1,741,423
$
1,660,060
Operating return on average assets
(1)
1.08%
1.03%
1.22%
1.51%
0.95%
(1) 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
6/30/2022
3/31/2022
12/31/2021
9/30/2021
6/30/2021
Tangible book value per common share (at period-end):
(1)
Total stockholders' equity (GAAP)
$
180,068
$
192,039
$
203,897
$
201,918
$
166,302
Less: Intangible assets
-
-
-
-
-
Less: Preferred stock
-
-
-
-
24,616
Tangible stockholders' equity (non-GAAP)
$
180,068
$
192,039
$
203,897
$
201,918
$
141,686
Total shares issued and outstanding (at period-end):
(2)
Class A common shares
20,000,753
20,000,753
19,991,753
18,767,541
3,889,469
Class B common shares
-
-
-
1,224,212
1,224,212
Total common shares issued and outstanding
20,000,753
20,000,753
19,991,753
19,991,753
5,113,681
Tangible book value per common share (non-GAAP)
(3)
$
9.00
$
9.60
$
10.20
$
10.10
$
27.71
Operating net income available to common stockholders:
(1)
Net income (GAAP)
$
5,295
$
4,854
$
5,650
$
6,593
$
4,053
Less: Preferred dividends
-
-
-
542
754
Less: Exchange and redemption of preferred shares
-
-
-
89,585
-
Net income (loss) available to common stockholders (GAAP)
5,295
4,854
5,650
(83,534)
3,299
Add back: Exchange and redemption of preferred shares
-
-
-
89,585
-
Operating net income avail. to common stock (non-GAAP)
$
5,295
$
4,854
$
5,650
$
6,051
$
3,299
Allocation of operating net income per common stock class:
Class A common stock
$
5,295
$
4,854
$
5,650
$
5,598
$
2,509
Class B common stock
$
-
$
-
$
-
$
453
$
790
Weighted average shares outstanding:
Class A common stock
Basic
20,000,753
19,994,953
18,913,914
15,121,460
3,889,469
Diluted
20,171,261
20,109,783
19,023,686
15,187,729
3,933,636
Class B common stock
Basic
-
-
-
6,121,052
6,121,052
Diluted
-
-
-
6,121,052
6,121,052
Diluted EPS:
(4) (5)
Class A common stock
Net income (loss) per diluted share (GAAP)
$
0.26
$
0.24
$
0.30
$
(5.11)
$
0.64
Add back: Exchange and redemption of preferred shares
-
-
-
5.48
-
Operating net income per diluted share (non-GAAP)
$
0.26
$
0.24
$
0.30
$
0.37
$
0.64
Class B common stock
Net income (loss) per diluted share (GAAP)
$
-
$
-
$
-
$
(1.02)
$
0.13
Add back: Exchange and redemption of preferred shares
-
-
-
1.09
-
Operating net income per diluted share (non-GAAP)
$
-
$
-
$
-
$
0.07
$
0.13
(1) The Company believes these non-GAAP measurements are key indicators of the ongoing earnings power of the Company.
(2) During the quarter ended September 30, 2021, 47,473 shares of Class C preferred stock and 11,061,552 shares of Class D preferred stock were converted into
10,278,072 shares of Class A common stock. Additionally, the Bank closed on the initial public offering of its Class A common stock on July 27, 2021, in which it
issued 4,600,000 shares of Class A common stock. As such, the total shares issued and outstanding of Class A common stock was 18,767,541 shares at September 30,
2021.
(3) Excludes the dilutive effect, if any, of shares of common stock issuable upon exercise of outstanding stock options.
(4) During the quarter ended September 30, 2021, basic net loss per share is the same as diluted net loss per share as the inclusion of all potential common shares
outstanding would have been antidilutive.
(5) During the quarter ended December 31, 2021, the Company entered into agreements with the Class B common shareholders to exchange all outstanding Class B
non-voting common stock for Class A voting common stock at a ratio of 1 share of Class A common stock for each 5 shares of Class B non-voting common stock. In
calculating net income (loss) per diluted share for the prior quarters presented, the allocation of operating net income available to common stockholders was based on
the weighted average shares outstanding per common share class to the total weighted average shares outstanding during each period. The operating net income
allocation was calculated using the weighted average shares outstanding of Class B common stock on an as-converted basis.
Exhibit 99.2 USBC FINANCIAL HOLDINGS Second Quarter 2022 Earnings Presentation July 29, 2022 1
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. The words “may,” “will,” “anticipate,” “should,” “would,” “believe,” “contemplate,” “expect ,” “aim,” “plan,” “estimate,” “continue,” and “intend,” as well as other similar words and expressions of the future, are intended to identi fy forward-looking statements. These forward-looking statements include 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 results of operations and financial condition from expected developments or events, or business and growth strategies, including anticipated internal growth. 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; • the continuation of the COVID-19 pandemic and its impact on us, our employees, customers and third-party service providers, and the ultimate extent of the impacts of the pandemic and related government stimulus programs; • 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 environment; • our ability to comply with the
extensive laws and regulations to which we are subject, including the laws for each jurisdiction where we operate; • legislative or regulatory changes and changes in accounting principles, policies, practices or guidelines, including the effects of the forthcoming implementation of the Current Expected Credit Losses (“CECL”) standard; • the effects of our lack of a diversified loan portfolio and concentration in the South Florida market, including the risks of geographic, depositor, and industry concentrations, including our concentration in loans secured by real estate; • the concentration of ownership of our Class A common stock; • fluctuations in the price of our Class A common stock; • our ability to fund or access the capital markets at attract ive 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, market, and monetary fluctuations; • increased competition and its effect on the pricing of our products and services as well as our interest rate margin; • 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 statement to reflect events or circumstances after the date on which the statement is 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 and, for periods prior to the completion of the bank holding company reorganization in December 31, 2021, U.S Century Bank filed with the FDIC. 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 measures because it believes these measures may provide useful supplemental information for evaluating the Company’s 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. To the extent applicable, 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 presentation. You should assume that all numbers are unaudited unless otherwise noted. 2
Q2 2022 Highlights Capital/Credit Credit metrics remain pristine. There were no loans classified as nonperforming. ACL coverage ratio was 1.15%. Tangible Book Value per Share is at $9.00, down $0.60 from prior quarter primarily due to AOCI. No shares repurchased during the quarter; Board approved repurchase program in place covering 750,000 shares of Class A common stock. Profitability Net income was $5.3 million or $0.26 per diluted share. ROAA was 1.08% and ROAE was 11.38%. Efficiency ratio was 55.34%. NIM was 3.37% and NII was $15.6 million, up $3.2 million or 25.4% compared to second quarter 2021. Growth Average deposits increased by $284.5 million or 19.9% compared to second quarter 2021. Total average loans, excluding PPP loans, increased $102.3 million or 34.9% annualized compared to prior quarter and $289.9 million or 29.3% compared to second quarter 2021. 3
Historical Financial Data Total Loans (1) in Millions $735 $1,373 2016 2017 2018 2019 2020 2021 Q1 Q2 2022 2022 Total Deposit s in millions $782 $1,739 2016 2017 2018 2019 2020 2021 Q1 Q2 2022 2022 Total Stockholders’ Equity in millions $86 $180 2016 2017 2018 2019 2020 2021 Q1 Q2 2022 2022 ACL/Total Loans 1.17% 1.15% 2016 2017 2018 2019 2020 2021 Q1 Q2 2022 2022 Net Charge off in thousands (1,019) $180 2016 2017 2018 2019 2020 2021 Q1 Q2 2022 2022 Nonperforming Assets/Total Assets 1.58% 0.00% 2016 2017 2018 2019 2020 2021 Q1 Q2 2022 2022 Total Revenue in millions $37 $63 2016 2017 2018 2019 2020 2021 Efficiency ratio 94.15% 55.34% 2016 2017 2018 2019 2020 2021 Q1 Q2 2022 2022 PTPP ROAA (2) 0.24% 1.57% 2016 2017 2018 2019 2020 2021 Q1 Q2 2022 2022 (1) Loan amounts include deferred fees/costs. (2) Non-GAAP Financial Measure. * As of end of period for Balance Sheet amounts. 4
Financial Results In thousands (except per share data) Q2 2022 Q1 2022 Q2 2021 Balance Sheet (EOP) Total Securities $456,135 $514,575 $395,804 Total Loans (1) $1,372,733 $1,258,388 $1,145,095 Total Assets $2,016,086 $1,967,252 $1,667,005 Total Deposits $1,738,720 $1,713,294 $1,438,776 Total Equity $180,068 $192,039 $166,302 Income Statement Net Interest Income $15,642 $14,379 $12,474 Non-interest Income $1,617 $1,945 $1,516 Total Revenue $17,259 $16,324 $13,990 Provision for Credit Losses $705 $0 $0 Non-interest Expense $9,551 $9,612 $8,674 Net Income $5,295 $4,854 $4,053 Net Income available to common stockholders (2) $5,295 $4,854 $3,299 Diluted Earning Per Share (EPS) (3) Class A Common Stock $0.26 $0.24 $0.64 Class B Common Stock $0.00 $0.00 $0.13 (1) Loan amounts include deferred fees/costs. (2) No preferred stock outstanding as of Q2’22 and Q1’22. (3) See footnote disclosure in the Non-GAAP table for common stock activity (redemption and exchange of preferred stock, IPO, and exchange of Class B common stock) which impacted diluted EPS for Q2’22 and Q1’22. 5
Key Performance Indicators Q2 2022 Q1 2022 Q2 2021 Capital/Credit Tangi ble Common Equity/Tangible Assets(1) 8.93% 9.76% 8.50% Total Risk-Based Capital (2) 13.74% 14.49% 12.69% NCO/Avg Loans (3) 0.00% -0.01% 0.06% NPA/Assets 0.00% 0.00% 0.00% Allowance Credit Losses/Loans 1.15% 1.20% 1.30% Profitability Return On Average Assets (ROAA) (3) 1.08% 1.03% 0.98% Return On Average Equity (ROAE) (3) 11.38% 9.75% 9.74% Net Interest Margin (3) 3.37% 3.22% 3.14% Efficiency Ratio 55.34% 58.88% 62.00% PTPP ROAA (1)(3) 1.57% 1.42% 1.28% Growth In thousands (except for TBV/share) Total Assets (EOP) $2,016,086 $1,967,252 $1,667,005 Total Loans (EOP) $1,372,733 $1,258,388 $1,145,095 Total Deposits (EOP) $1,738,720 $1,713,294 $1,438,776 Tangible Book Value/Share (1) $9.00 $9.60 $27.71 (1) Non-GAAP Financial Measures. TBV/Share for Q2’22 and Q1’22, see footnote disclosure in the Non-GAAP table for common stock activity (redemption and exchange of preferred stock, IPO, and exchange of Class B common stock) which impacted TBV/share. (2) The Company was established in Q4 2021. As such, the capital ratios for Q2 2022 and Q1 2022 are for the Bank Holding Company while Q2 2021 is for the Bank only. (3) Annualized. 6
Loan Portfolio Total Loans (AVG) in millions $1,300 $1,200 $1,100 $1,000 $900 $800 $1,088 $1,144 $1,159 $1,211 $1,296 $700 $99 $73 $51 $35 $18 $600 $989 $1,071 $1,108 $1,176 $1,278 Q2 2021 Q3 2021 Q4 2021 Q1 2022 Q2 2022 Loans (Exd PPP) PPP Loans Loan Yields 5.00% 4.50% 4.00% 3.50% 3.00% 2.50% 2.00% 1.50% 1.00% 4.19% 4.29% 4.32% 4.35% 435.00% 0.50% 0.28% 0.32% 0.33% 0.28% 1.30% 0.00% 3.91% 3.97% 399.00% 4.07% 4.22% + 31 bps Q2 2021 Q3 2021 Q4 2021 Q1 2022 Q2 2022 Q2'22 vs Q2'21 Loan coupon Loan fees Commentary Total average loans, excluding PPP loans, increased $102.3 million or 34.9% annualized compared to prior quarter and $289.9 million or 29.3% compared to second quarter 2021. Loan coupon increased 15 bps due to a higher interest rate environment compared to prior quarter and 31 bps increase compared to second quarter 2021. Loan fees decreased 15 bps from prior quarter as most of the PPP loan fees have been recognized, normalizing the loan yield composition. 7
Loan Portfolio Mix Loan Portfolio Mix Residential real estate CRE – Non-owner occupied CRE – Owner occupied Commerical and industrial Global Banking Consumer and other 8% 15% 51% 10% 10% 8% Commentary Total Loan balances at quarter end was $1.373 billion. Commercial Real Estate (owner occupied and non-owner occupied) was 61% or $843.4 million of the total loan portfolio. CRE mix is diversified and granular. Retail makes up 30% of total CRE or $252.6 million. Land/Construction 5% Other 4% Retail 30% - LTV was 56.9% - Average loan size was $3.0 ..million CRE - Owner occupied 17% Multifamily 16% Office 13% Hotels 8% Warehouse 7% As of 6/30/22 8
Loan Production Net Loan Production Trend in millions $180 $160 $140 $120 $100 $80 $60 $40 $20 $144 $104 $117 $88 $119 $106 $141 $74 $169 $56 0 Q2 2021 Q3 2021 Q4 2021 Q1 2022 Q2 2022 Loan Production/Line changes Loan Amortization/payoffs Commentary Q2 loan growth driven by increased production levels and lower payoffs and paydowns. Payoffs and paydowns slowing with increase in interest rates. $169 million loan production in Q2 2022 is attributable to $158 million in new loans and $11 million in net increase of existing lines of credit. 9
Paycheck Protection Program (PPP) 3 successful rounds of PPP loans, originating $168.4 million. Forgiveness of the last round of PPP loans is in process. SBA PPP Loans In thousands (except for ROAA) Q2 2022 Q1 2022 Q2 2021 Pre-Tax Income $7,003 $6,712 $5,316 Net Income $5,295 $4,854 $4,053 Average Assets $1,968,381 $1,913,484 $1,660,060 ROAA (1) 1.08% 1.03% 0.98% of which PPP Income (2) $484 $1,001 $925 Unrealized PPP Fees EOP $149 $590 $3,169 PPP Balance EOP $13,507 $24,646 $84,240 PPP AVG. Balance $17,643 $34,901 $99,563 (1) Annualized. (2) PPP Income includes loan fees and interest income. 10
Deposit Portfolio Deposits (AVG) in millions $2,000 $1,800 $1,600 $1,400 $1,200 $1,000 $800 $600 $1,432 $1,477 $1,562 $1,650 $1,717 $400 $236 $229 $228 $223 $224 $200 $608 $628 $674 $736 $781 $0 $52 $55 $56 $56 $67 $5,536 $5,565 $5,604 $5,626 $5,645 Q2 2021 Q3 2021 Q4 2021 Q1 2022 Q2 2022 Non-interest-bearing deposits Money market and savings Interest-bearing demand deposits Time deposits Deposit Cost (1) 0.26% 0.22% 0.21% 0.20% 0.21% 0.25% 0.25% 0.25% 0.50% 0.21% Q2 2021 Q3 2021 Q4 2021 Q1 2022 Q2 2022 Commentary Average deposits increased $66.4 million or 16.1% annualized compared to prior quarter and $284.5 million or 19.9% compared to second quarter 2021. Average DDA deposits grew $18.6 million or 11.9% annualized compared to prior quarter and $109.1 million or 20.4% compared to second quarter 2021. DDA balances comprise 37.6% of total deposits at June 30, 2022. Deposit cost increased 1bps compared to prior quarter and decreased 5 bps compared to second quarter 2021. 11
Net Interest Margin Net Interest Income/Margin (1) in thousands (exceptions) Net Interest Income NIM NIM excluding PPP Loans Interest-Earning Assets Mix (AVG) Total Loans (excluding PPP Loans) Investment Securities PPP Loans Cash Balance & Equivalents Commentary Net interest income increased by $1.3 million or 35.2% annualized compared to prior quarter and $3.2 million or 25.4% compared to second quarter 2021. NIM impacted by an increase in interest rates and a shift in balance sheet mix. Loan production growth shifted assets to a higher yielding asset class and was funded by cash balances, a lower securities portfolio and growth in new deposits . NIM of 3.37% up 15 bps from prior quarter and up 23 bps from second quarter 2021 demonstrating an asset sensitive balance sheet. 12
Interest Rate Sensitivity Loan Portfolio Repricing Profile by Rate Type Hybrid ARM 6% Variable Rate 53% Fixed Rate 41% 22% 18% 60% 22% Loan Repricing Schedule Variable/Hybrid Rate Loans 46% 37% 6% 11% 46% 0-4-1 yrs. 1-2 yrs. 2-4 yrs Static NII Simulation Year 1 & 2 $5,000 $4,000 $3,000 $2,000 3.3% 5.9% $1,000 $2,371 $4,178 $0 0.2% 0.1% Net interst income ($ in thousands) $138 $70 +200 +100 +200 Changes from base (%) Years 1 Years 2 As of 6/30/22 13
Non-interest Income In thousands (except ratios) Q2 2022 Q1 2022 Q4 2021 Q3 2021 Q2 2021 Service fees $1,083 $900 $961 $856 $903 Gain (loss) on sale of securities available for sale (3) 21 35 (70) 187 Gain on sale of loans held for sale 22 334 107 532 23 Gain on sale of other assets - - 983 - - Loan settlement - 161 - 2,500 - Other income 515 529 558 399 403 Total non-interest income $1,617 $1,945 $2,644 $4,217 $1,516 Average total assets $1,968,381 $1,913,484 $1,828,037 $1,741,423 $1,660,060 Non-interest income / Average assets (1) 0.33% 0.41% 0.57% 0.96% 0.37% Total Revenue $17,259 $16,324 $16,720 $17,688 $13,990 Non-interest income as % of total revenue 9.37% 11.91% 15.81% 23.85% 10.84% Commentary Service fees and other income remain consistent quarter over quarter. Fluctuation of non-interest income primarily impacted by one-time items in prior quarters. Prudently managing securities with minimal losses ($3 thousand) in Q2 2022 as interest rates increase. (1) Annualized. 14
Non-interest Expense In thousands (except ratios and FTE) Q2 2022 Q1 2022 Q4 2021 Q3 2021 Q2 2021 Salaries and employee benefits $5,913 $5,875 $5,634 $5,313 $5,213 Occupancy 1,251 1,270 1,267 1,192 1,411 Regulatory assessment and fees 226 213 93 317 195 Consulting and legal fees 398 517 539 357 373 Network and information technology services 448 387 268 358 332 Other operating expense 1,315 1,350 1,518 1,470 1,150 Total non-interest expenses $9,551 $9,612 $9,319 $9,007 $8,674 Efficiency ratio 55.34% 58.88% 55.74% 50.92% 62.00% Average total assets $1,968,381 $1,913,484 $1,828,037 $1,741,423 $1,660,060 Non-interest expense / Average assets (1) 1.95% 2.04% 2.02% 2.05% 2.10% Full-time equivalent employees 192 190 187 184 183 Commentary Salaries and employee benefits increased primarily due to 2 new FTEs. Consulting and legal fees normalizing after one-time expenses related to the holding company reorganization in Q1 2022 and Q4 2021. Higher revenue and slightly lower non-interest expense improved efficiency ratio to 55.34%. (1) Annualized. 15
Asset Quality Allowance for Credit Losses In thousands except ratios 1.40% 1.33% 1.31% 1.22% 1.16% 1.30% 1.27% 1.27% 1.20% 1.15% $1,848 $14,900 $15,057 $15,074 $15,786 Q2 2021 Q3 2021 Q4 2021 Q1 2022 Q2 2022 Allowance for credit losses ACL/Total loans ACL/Total loans excluding PPP Loans Commentary ACL coverage ratio is at 1.15% or 1.16% excluding PPP loans, in line with pre-pandemic levels. No loans classified as non-performing. No OREOs. CECL modeling progressing as planned; first parallel run was completed in Q2 2022. Non-performing Loans In thousands (except ratios) 1400 1200 1000 800 600 400 200 0 $20 0.00% $18 0.00% $1,190 0.10% $0 0.00% $0 0.00% Q2 2021 Q3 2021 Q4 2021 Q1 2022 Q2 2022 Non-accrual TDRs Non-accrual loans less non-accrual TDRs Non-performing loans to total loans 16
Capital Capital Ratios11*! Q2 2022 Leverage Ratio 9.43% TCE/TA{2) 8.93% Tier 1 Risk Based Capital 12.65% Total Risk Based Capital 13.74% Q1 2022 Q2 2021 Well- Capitalized 9.47% 7.91% 5.00% 9.76% 8.50% NA 13.35% 11.44% 8.00% 12.69% 10.00% 14.49% Commentary All capital ratios remain significantly above “well capitalized” guidelines. Q2 2022 EOP shares outstanding: Class A Common Stock: 20,000,753 No shares repurchased during the quarter; Board approved repurchase program in place covering 750,000 shares of Class A common stock. (1) The Company was established in Q4 2021. As such, the capital ratios for Q2 2022 and Q1 2022 are for the Company while Q2 2021 is for the Bank only. (2) Non-GAAP. 17
Takeaways Leading Franchise Located in one of the Most Attractive Banking Markets in Florida and the U.S. Experienced and Tested Management Team Robust Organic Growth Strong Asset Quality, with Minimal Charge-offs Experienced Since Recapitalization Strong Profitability, with Pathway For Future Enhancement Identified Core Funded Deposit Base with 37.6% Non-Interest-Bearing Deposits (EOP) 18
Non-GAAP Reconciliation In thousands (except ratios) 6/30/2022 Pre-Tax Pre-Provis ion f TIPP") Income: Netincora?$5.295 Rus: Provision forincone taxes 1.708 Rus: Revision for credit losses 705 PIPP incone _S 7,708 PTPP Return on Average As sets: PIPP incone$7.708 Average assets$1,96S,3S1 PIPP return on average assets 1.57% Oner at in g Net Inc ome: Net incone$5.295 Less: Net gains (tosses) on sale of securities (3) Less: Tax effect on sale of securities 1_ Operating net income _S 5.297 Operating PTPP Income: PIPP incone$7,708 Less: Net gains (tosses) on sale of securities (3) Operating PTPP Incone _S 7.711 Operating PTPP Return on Average Assets: Operating PIPP incone$7,711 Average assets$1,968,381 Operating PIPP Return on average assets 1.57% Oper at in g Return on Aver ag e Assets : Operating net income$5.297 Average assets$1,968,381 Operating return on average assets ' ' 1.08% As of or for the three months ended 3/31/2022 12/31/2021 9/30/2021 6/30/2021 S 4.854 S 5.650 S 6.593 S 4.053 1.S58 1.751 2088 1.263 S 6.712 S 7.401 S 8.681 S 5.316 S 6.712 S 7.401 S 8.681 S 5.316 S 1,913,484$1,828,037$1,741,423$1,660,060 1.42% 1.61% 1.98% 1.28% s 4.854 S 5.650 S 6.593 S 4.053 21 35 (70) 187 ÍSL <2L 17 S 4.S3S S 5.624 $ 6.646 S 3.912 S 6,712$7,401$8,681$5,316 21 35 JTC^ 181 S 6.691$7,366$S.751$5.129 S 6,691 S 7,366 S 8,751 S 5,129 S 1,913,484$1,828,037$1,741,423$1,660,060 1.42% 1.60% 1.99% 1.24% S 4.838 S 5.624 S 6.616 S 3.912 S 1,913,484$1,828,037$1,741,423$1,660,060 1.03% 1.22% 1.51% 0.95% (1) Annualized 19
Non-GAAP Reconciliation In thousands (except per share data) In thousands (except per A. of i»d for ike ar»ao»a-. tided fl 1 6 30.2022 3 31 2022 12 3 1 2021 9 30 2021 6 30.2021 Ti agible Bock Va lie per Cor* noi Shire (it period-ead): loulclockholdcrc'eoas v (GA AP| S ISXObS s 192019 S 201 *9 7 s 201.918 S 166.102 lecc : Inundóle jccclc ----- Less : Preferred cioc k 24016 tangible cioc (holders'equity (non-GAA Pk S 180.068 s 192019 s 201*97 S 201.918 S 141086 Toral iteres lifted and ontiB nding (at period-end): ('lice A commcn shares 20.0C0.TSJ 20.000.TS.1 19.991.75.1 18767041 .1*89.469 Giles (¡common chares 1.224.2 12 1-Î24J2I2 1 oialcomm.cn chares issued and ou island mg 200CO .75 l 20.000.7S 1 1.7SJ I.TSJ 5.1110*1 1 angible book vatac percommon chare (non-GA AP) ' ' V s s 10.20 s s yj 0 penda* Net I»coa e Available nCcauM S lock k olden : Sel meóme (GAA P> S s 4*54 s 5/k50 s 6091 s 4.0 S.1 Lecc : Preferred dividende - 542 754 Lecc: (-«change and red cmpu.cn of preferred charec . . . 89085 . Sel meóme (bee) available a> common stockholders (GA AP> SJ9S 4ÃS4 SOSO (8.10.14) 1.299 Add back: (exchange and redemplicn ofpreferred charec 89085 Operatmg nel mcom: avail lo comnun clock (non-GAA P| s SJ9S s 4*34 s SOSO s 6031 s 1’99 A lie cation of operating net income per comm on ¡to ci cia n: £ « *o \ s s < V«4 s S « /-*.» s S « <ú« s s Glass (¡comm.cn clock$ ***** 4SI 790 Weighed average liarei on a tan ding: Gla.cc A common clock llacK 20.000.75! 19.994.95.1 I&.9I.1.9I4 IS. 12 1.460 .1*89.469 Dialed 20171.261 20.109.7* J 19.021086 15.187.729 1.911016 Glass (¡ commcn clock Hack: . . . 6.121052 6.121052 Dialed - - - 6121052 6.121052 Dita ted I PS: "*"* ' (Jan \ common c lock Sel income (fc>cc)perdiluted share«"; A AP)$0.26 S 0.24 S 0-10 S (5.11) S 0X4 A dd back: Met an»e and redcmptmn of pie ferret] cha res ; ; ; • 4» • Operating nel mcom:
per dita led chare (non -<t\ Aft Class licommcn clock Nel income (toee)perdil uted chare(GA AP)$s$S (1.02) S 0.11 Add back: (--«change and redcmptmn ofpre ferred charec 1.09 Operating nel mcom: perditaled chare (non-GA AP) 4 «$ (t) The Company belbves these non GAAP measurements are key bdicaars of iie ongaing earnbgs pc» er of the Conjjany. 2. During the quarter ended Sept entier 30. 2021.47.473 shares of Class C preferred sack and 11.061.552 shares of Class D preferred sack * ere comer ad bto 10278.072 shares of Class A com non stock. AcMitbnally. the Bank closed on iie initial pubic dieting of is Cass A common sack on July 27. 2021. in which it issued 4.600.COO shares of Class A common stock. As such, the toal shares issued rad outstanding d Class A com non sack* as 18.767.541 shares at Scptentier 30. 2021. 3. EjcIjJcs iie dlutivc effect, if any. of shares of com moi sack ¿suable upon eiocBc of outsanding stock options. 4. During the quarter ended Septentier 30. 2021. basic net loss per share is the same as dluad net bss per share as the inebsion of all poanaal common shacs outstanding would have been anadiuáve. 5. During the quarter ended December 31.2021. iie Company entered into agreements * ih the Class B common shrr ehobers a cachangc el outsanding Class B non-votbg common stockfer Class A voting common stockât a ratio of 1 shrre of Cbss A common stockfor each 5 shares of Class B non-votbg common stock, h catulaang net income (Ices) per dluad share for the prbr quarters presented., iie allocrsion of operating net income avalabfc a common slockhobers was based on the weighad average shares outsanding per common share class a iie aal w eithted average shares outsand'ng djrbq each period. The operatbq net bcome albcatbn wascalcubted usinq the weiqhad averaqe shares outsandinq of Cbss B common stockon an as converted basis. 20
Contact Information Lou de la Aguilera President, CEO & Director (305) 715-5186 laguilera@uscentury.com Rob Anderson Chief Financial Officer (305) 715-5393 rob.anderson@uscentury.com Investor Relations InvestorRelations@uscentury.com 21