Community Shores Bank Corporation
Community Shores Bank — Merger or Acquisition (January 2020)
15 slides from Community Shores Bank's merger presentation, Jan 6, 2020
Slide 1: ChoiceOne Financial Services, Inc.
ChoiceOne Financial Services, Inc. 1
Slide 2: Strategic Acquisition Pending
Sparta, Michigan 2 Muskegon, Michigan has agreed to acquire Strategic Acquisition Pending ChoiceOne Financial Services, Inc. Community Shores Bank Corporation
Slide 3: Forward-looking statements
3 This presentation contains forward-looking statements. Words such as “anticipates,” “believes,” “estimates,” “expects,” “forecasts,” “intends,” “is likely,” “plans,” “predicts,” “projects,” “may,” “could,” “look forward,” “continue”, “future” and variations of such words and similar expressions ar
Slide 4: Communication regarding proposed merger transaction
4 This communication is being made in respect of the proposed merger transaction between ChoiceOne and Community Shores. In connection with the proposed merger, ChoiceOne will file with the Securities and Exchange Commission (“SEC”) a Registration Statement on Form S-4 that will include the Proxy St
Slide 5: Participants in Solicitation
5 Community Shores and certain of its directors and executive officers may be deemed to be participants in the solicitation of proxies from Community Shores shareholders in respect of the transaction described in the Proxy Statement/Prospectus. Additional information regarding the interests of those
Slide 6: Transaction overview
6 • ChoiceOne Financial Services (“ChoiceOne”) and County Bank Corp. (“County”) completed a merger of equals on 10/1/2019 • ChoiceOne is the parent company of ChoiceOne Bank headquartered in Sparta, Michigan and Lakestone Bank & Trust headquartered in Lapeer, Michigan • ChoiceOne to acquire Communit
Slide 7: Acquisition Rationale
7 • Q3 2019 loan/deposit ratio of 83.6% at Community Shores (75.4% at ChoiceOne) • Attractive deposit franchise with ~75% non-time deposits, including 22.5% noninterest-bearing demand deposits ($41.4mm) Attractive Balance Sheet Commercially-focused Acquisition Rationale • Complementary commercial-fo
Slide 8: Transaction assumptions and terms
8 Ownership/Share Count Consideration Mix Accounting Assumptions Transaction Costs Estimated Cost Savings / Revenue Enhancements • ChoiceOne outstanding common shares 7,238,559 • Shares Issued to Community Shores (assumes 75% election) 531,807 (1) • Pro forma shares 7,770,366 (2) • Fully phased-in c
Slide 9: Pro Forma Branch Map
9 Pro Forma Branch Map Lakestone Bank & Trust ChoiceOne Bank Community Shores Bank Source: S&P Global Market Intelligence; Deposit data as of June 30, 2019 Institution 2019 Rank Branches Deposits Market Share (%) Muskegon, MI Fifth Third Bancorp 1 6 434,382 27.05 PNC Financial Services Group 2 7 384
Slide 10: Market Comparison
10 Market Comparison ChoiceOne Financial Services Community Shores Bank Corp. Market Area Market Area State of POPULATION DATA Total (1) Total (2) Michigan 2020 Estimated 2,307,519 469,339 10,020,118 2025 Projected 2,343,516 482,533 10,106,291 % Change 2020 - 2025 1.6% 2.8% 0.9% MARKET DEPOSITS ($mm
Slide 11: Pro forma loan portfolio composition
ChoiceOne Bank Lakestone Bank & Trust Community Shores Bank Pro Forma Combined Balance % of Lakestone Bank & Balance % of Community Shores Balance % of Balance % of ChoiceOne Bank ($000) Total Trust ($000) Total Bank ($000) Total Pro Forma Combined ($000) Total Construction $21,861 5.0% Construction
Slide 12: Pro forma deposit composition
ChoiceOne Bank Lakestone Bank & Trust Community Shores Bank Pro Forma Combined Balance % of Lakestone Bank & Balance % of Community Shores Balance % of Balance % of ChoiceOne Bank ($000) Total Trust ($000) Total Bank ($000) Total Pro Forma Combined ($000) Total Demand $37,055 6.4% Demand $125,152 21
Slide 13: Financial Highlights
13 Financial Highlights Source: S&P Global Market Intelligence Note: Financial data shown is at bank level; TCE/TA and per share data is consolidated at holding company $ in 000s 2015 2016 2017 2018 2019 Q3 LTM 2015 2016 2017 2018 2019 Q3 LTM 2015 2016 2017 2018 2019 Q3 LTM Balance Sheet: Assets $56
Slide 14: Contribution Analysis
14 Contribution Analysis As of September 30, 2019 Source: S&P Global Market Intelligence Pro Forma SELECT BALANCE SHEET CONTRIBUTIONS COFS Contribution CSHB Contribution Combined (1) Total Assets $1,376,506 87.1% $204,422 12.9% $1,580,928 Total Loans $865,937 84.9% $153,749 15.1% $1,019,686 Total De
Slide 15: Thank You!
Thank You!
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