MARCH 2020 INVESTOR PRESENTATION Financial Data as of: Second Quarter 2023 NASDAQ: FGBI www.fgb.net
2 CERTAIN IMPORTANT INFORMATION CAUTION REGARDING FORWARD LOOKING STATEMENTS This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended with respect to the financial condition, liquidity, results of operations, and future performance of the business of First Guaranty Bancshares, Inc. (“First Guaranty,” the “Company” or “FGBI”). These forward-looking statements are intended to be covered by the safe harbor for “forward-looking statements” provided by the Private Securities Litigation Reform Act of 1995. Forward-looking statements are those that are not historical facts. Forward-looking statements include statements with respect to beliefs, plans, objectives, goals, expectations, anticipations, estimates and intentions that are subject to significant risks and uncertainties and are subject to change based on various factors (some of which are beyond our control). Forward-looking statements often include the words “believes,” “expects,” “anticipates,” “estimates,” “forecasts,” “intends,” “plans,” “targets,” “potentially,” “probably,” “projects,” “outlook” or similar expressions or future conditional verbs such as “may,” “will,” “should,” “would” and “could.” We caution you that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions and uncertainties that are difficult to predict. These forward-looking statements are subject to a number of factors and uncertainties, including, changes in general economic conditions, either nationally or in our market areas, that are worse than expected; competition among depository and other financial institutions; inflation and changes in the interest rate environment that reduce our margins or reduce the fair value of financial instruments; adverse changes in the securities markets; changes in laws or government regulations or policies affecting financial institutions, including changes in regulatory fees and capital requirements; our ability to consummate the acquisition of Lone Star Bank (“Lone Star”) and to realize the expected benefits of the acquisition; our ability to enter new markets successfully and capitalize on growth opportunities; our ability to successfully integrate acquired entities; changes in consumer spending, borrowing and savings habits; changes in accounting policies and practices, as may be adopted by the bank regulatory agencies, the Financial Accounting Standards Board, the Securities and Exchange Commission and the Public Company Accounting Oversight Board; changes in our organization, compensation and benefit plans; changes in our financial condition or results of operations that reduce capital available to pay dividends; increases in our provision for loan losses and changes in the financial condition or future prospects of issuers of securities that we own, which could cause our actual results and experience to differ from the anticipated results and expectations, expressed in such forward-looking statements. We undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise. Although we believe that the expectations reflected in these forward-looking statements are reasonable as of the date made, actual results may prove to be materially different from the results expressed or implied by the forward-looking statements. NON-GAAP FINANCIAL MEASURES Statements included in this presentation include non-GAAP financial measures and should be read along with the accompanying tables under the section titled “Non-GAAP Reconciliations.” The Company uses non-GAAP financial measures to analyze its performance. Management believes that non-GAAP financial measures provide additional useful information that allows readers to evaluate the ongoing performance of the Company and provide meaningful comparison to its peers. Non-GAAP financial measures should not be considered as an alternative to any measure of performance or financial condition as promulgated under GAAP, and investors should consider the Company’s performance and financial condition as reported under GAAP and all other relevant information when assessing the performance or financial condition of the Company. Non-GAAP financial measures have limitations as analytical tools, and investors should not consider them in isolation or as a substitute for analysis of the results or financial condition as reported under GAAP.
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4 FINANCIAL HIGHLIGHTS Total assets increased YoY by 9.3% to $3.2 billion Total loans increased YoY by 12.8% to $2.6 billion QTD net income of $2.7 million QTD earnings per common share of $0.19 Return on average assets of 0.34% for 2Q 2023 Return on average common equity of 4.19% for 2Q 2023 Allowance for credit losses totaled $31.9 million CECL adopted January 2023. $10MM pre-tax adjustment. $7.1 million ACL. $2.9MM other liabilities Allowance for credit losses represented 1.23% of gross loans Strong liquidity resources. On and off-balance sheet FHLB net capacity was $316.1 million. FRB Discount capacity of $184.3 million. First Guaranty did not use the Federal Reserve Bank Term Loan Funding Program at 6/30/2023 2023 HIGHLIGHTS *Annualized ¹Non-GAAP measure. See “Certain Important Information – Non-GAAP Financial Measures” on slide 2 Source: Company documents In $000s except for per share data 12/31/2020 12/31/2021 12/31/2022 2Q2023 BALANCE SHEET Total Assets $2,473,078 $2,878,120 $3,151,347 $3,236,046 Total Gross Loans $1,844,135 $2,159,359 $2,519,077 $2,590,666 Total Deposits $2,166,318 $2,596,492 $2,723,792 $2,767,419 Loans/Deposits 85.13% 83.16% 92.48% 93.61% CAPITAL Common Equity $178,591 $190,831 $201,933 $205,799 Preferred Equity $0 $33,058 $33,058 $33,058 Total Equity/Assets 7.22% 7.78% 7.46% 7.38% Tang. Common Equity/Tang. Assets1 6.51% 6.04% 5.89% 5.87% PROFITABILITY MEASURES Net Interest Margin 3.35% 3.44% 3.47% 2.74% Net Interest Income/Average Assets 3.18% 3.31% 3.35% 2.64% * Non Interest Expense/Average Assets 2.47% 2.36% 2.38% 2.49% * Efficiency Ratio 58.95% 63.63% 63.94% 83.18% Cost of funds 1.48% 1.11% 1.66% 3.78% ROACE 11.36% 14.06% 13.64% 4.19% Earnings Per Common Share 1.90$ 2.42$ 2.48$ 0.19$ Net Income $20,318 $27,297 $28,884 $2,676 ASSET QUALITY NPAs/Total Assets 1.25% 0.70% 0.47% 0.79% Reserves/Total Loans 1.33% 1.11% 0.93% 1.23% For the Years Ended
5 LOAN PORTFOLIO Source: Company documents, as June 30, 2023 Loan growth of 12.8% YOY 34.3% growth in loan interest income YOY Loan yield of 6.21% YTD 2023 Commercial leases represent 10.9% of the loan portfolio, providing higher yields and shorter average lives than real estate secured loans Oil & Gas related loans made up approximately 3.3% funded and 1.9% unfunded of the total loan portfolio as of June 30, 2023 Hotel loans totaled $182.9 million, or 7.1% of the total loan portfolio as of June 30, 2023 • All hotels flagged by major brands • Office Space loans totaled approximately $105.6 million, or 4.1% of the total loan portfolio as of June 30, 2023 HIGHLIGHTS Commercial & Industrial13.0% Non‐Farm Non‐ Residential 39.5% Residential Real Estate 20.3% Commercial Leases 10.9% Consumer & Other 1.8% Agriculture & Farm 2.9% C&D 11.6% LOAN PORTFOLIO COMPOSITION 6/30/23 ($000s) 2020Y 2021Y 2022Y 2Q2023 Commercial & Industrial 353,028$ 398,391$ 385,279$ $338,023 Non‐Farm Non‐Residential 824,137 886,407 992,929 1,025,073 Residential Real Estate 317,168 354,195 486,115 527,490 Commercial Leases 104,141 246,022 317,574 282,161 Consumer & Other 44,642 48,142 47,864 47,771 Agriculture & Farm 55,215 58,557 63,868 77,322 C&D 150,841 174,334 233,091 301,259 Total Gross Loans 1,849,172$ 2,166,048$ 2,526,720$ 2,599,099$ LESS: Unearned Income 5,037 6,689 7,643 8,433 Total Loans 1,844,135$ 2,159,359$ 2,519,077$ 2,590,666$ Loan Portfolio Detail
6 119.95% 158.68% 123.91% 0.00% 20.00% 40.00% 60.00% 80.00% 100.00% 120.00% 140.00% 160.00% 180.00% 200.00% 2021 2022 2023 CONSERVATIVE CREDIT CULTURE Source: Company documents, as of and for the six months ended June 30, 2023 ACL/NONPERFORMING ASSETS HISTORICAL ASSET QUALITY 0.70% 0.47% 0.79% 0.13% 0.18% 0.04% 0.00% 0.20% 0.40% 0.60% 0.80% 1.00% 1.20% 1.40% 2021 2022 2023 NPAs/Total Assets NCOs/Average Loans (dollars in thousands) 12/31/2021 12/31/2022 6/30/2023 NONACCRUAL LOANS $16,715 $13,566 $23,903 90 DAY LOANS AND GREATER BUT STILL ACCRUING $1,245 $1,142 $538 OREO $2,072 $113 $1,273 NONPERFORMING ASSETS $20,032 $14,821 $25,714 NPAs / TOTAL ASSETS 0.70% 0.47% 0.79% NONACCRUAL LOANS / TOTAL ASSETS 0.58% 0.43% 0.74% ACL / TOTAL LOANS 1.11% 0.93% 1.23% TEXAS RATIO 6.63% 4.48% 7.26% NPAs/TOTAL ASSETS & NCOs/AVG LOANS
7 Demand ‐ Noninterest 16.8% Demand ‐ Interest52.3% Savings 8.0% Time Deposits 22.8% HIGHLIGHTS Total YTD deposit growth of 1.60%. Total YOY deposit growth of 4.04% New Markets opened • Vanceburg, KY Branch opened 1/18/23 • Bridgeport, WV Branch expected by year end • Mideast market total deposits of approximately $35 million with over 700 deposit accounts Long history of ICS / CDARS expertise. $638 million at 6/30/23 Uninsured deposits excluding collateralized public funds estimated at approximately 10.3% of deposits Continued strong CD demand. YTD Time Deposits up 18.20% as consumers shift funds from liquid deposits Introduced new deposit product specials SavingsElite 3.50% 7-Month CD 5.15% Approximately $164 million in CDs mature from August 1st to end of 2023. Avg rate of 3.30% DEPOSIT PORTFOLIO Source: Company documents, as of and for the six months ended June 30, 2023 6/30/2023 DEPOSIT MIX ($000) 2020 2021 2022 2Q2023 Demand ‐ Noninterest Bearing $411,416 $532,578 $524,415 $466,172 Demand ‐ Interest Bearing 860,394 1,275,544 1,460,259 1,448,492 Savings 168,879 201,699 205,760 222,296 Time Deposits 725,629 586,671 533,358 630,459 Total Deposits $2,166,318 $2,596,492 $2,723,792 $2,767,419 Weighted Average Rate 1.1% 0.8% 1.2% 2.8% Deposit Composition
BIGGER | STRONGER | MORE PROFITABLE FIRST GUARANTY BANCSHARES, INC.