PSB Holdings, Inc. · OTC:PSBQ
PSB — Shareholder Meeting (April 2022)
42 slides from PSB's shareholder meeting presentation, Apr 19, 2022
Slide 1: Annual Meeting April 19, 2022
ANNUAL MEETING April 19, 2022 PSB Holdings, Inc.
Slide 2: William J. Fish, Chairman
William J. Fish — Chairman PSB Holdings, Inc. Peoples State Bank
Slide 3: Peoples State Bank
Peoples STATE BANK Allurays see the Petential. PSB Holdings, Inc.
Slide 4: Agenda
Agenda Scott M. Cattanach • President’s Message • 2021 Highlights • 2022 Strategic Actions Pat Heier • Managing Asset Quality Jeff Musa • Southeast Wisconsin Growth Investment Value Proposition Formal Business Questions & Answers
Slide 5: Scott M. Cattanach, President & CEO
Scott M. Cattanach — President & CEO PSB Holdings, Inc. Peoples State Bank
Slide 6: Our Mission
Our Mission It’s about you: Our customers, employees, and shareholders To build individual and community financial strength through shared vision and participation Customer relationships built on trust and a great user experience
Slide 7: Best Banks to Work For and Awards
Best in Marathon County Best Banks to Work For Top 200 Community Bank 10th Year in a Row 3rd Year in a Row 12th Year in a Row
Slide 8: Shareholder Value Strategy
Shareholder Value Strategy • $1.8 to $2 billion total assets by December 2026 led by Milwaukee area and new market growth • Spread the Peoples story to new investors to increase interest in ownership and number of shareholders • Leverage business model strengths to grow tangible book value through i
Slide 9: 2021 Highlights – Waukesha Acquisition Completed
2021 Highlights – Waukesha Acquisition Completed • Added $140 million in assets at closing • Initial loan and deposit retention during merger period within initial projections • With merger cost efficiencies now in place, on pace to exceed the 2022 acquisition earnings target by 15% • Remodeling the
Slide 10: 2021 Highlights - Northcentral Market Success
2021 Highlights - Northcentral Market Success
Slide 11: 2021 Highlights Commercial Banking
2021 Highlights Commercial Banking Significantly completed SBA PPP loan cycle • $151 million in loans in 2020 and 2021 • All but $14 million repaid or forgiven by the SBA • $5.2 million in PPP origination fees and interest income through Dec. 31, 2021 Top SBA 504 program lender in Wisconsin in 2021
Slide 12: 2021 Highlights Wealth Management
2021 Highlights Wealth Management • Grew advisory fee income to nearly $2 million • Expanded service in Milwaukee area • Provided an avenue to serve customers needing retirement planning or investment options outside of traditional FDIC insured deposits
Slide 13: Information Protection – Best in Class
Information Protection – Best in Class • Best inBest class partners, in class updated partners, updatedin real time in real time • Focus not just on viruses, but on protecting customer data • External “break Focus in”on not just tests annually viruses, but on protecting customer data • Vendor and ou
Slide 14: 2021 Highlights Asset Growth
2021 Highlights Asset Growth Total Assets, Loans, and Deposits - December 31 ($000s) $1,400,000 $1,298,711 $1,200,000 $1,000,000 $1,105,240 $800,000 $879,398 $600,000 $400,000 $200,000 $0 2017 2018 2019 2020 2021 Loans Deposits Assets
Slide 15: 2021 Highlights Earnings
2021 Highlights Earnings Earnings and Dividends per share $3.50 $3.00 $2.88 $2.50 $2.00 $1.50 $1.00 $0.46 $0.50 $- 2017 2018 2019 2020 2021 Earnings per share Dividends per share
Slide 16: 2021 Highlights Return on Equity
2021 Highlights Return on Equity Return on Equity vs. Peer 16% 14% 11.63% 12% 10% 8% 6% 4% 2% 0% 2017 2018 2019 2020 2021 PSB SNL Financial LC Peer Median $1B - $1.5 B Assets
Slide 17: Looking ahead…
Looking ahead… Peoples’ 60-year anniversary
Slide 18: 2022 Strategic Actions
2022 Strategic Actions Targets Strategy Support • Online deposit • Customer experience account opening tool • Home office remodel • Customer experience • New Balance Banking • Growth account • SBA 7(a) lending • Growth program • St. Point expansion • New market
Slide 19: Action Item Strategy
Action Item Strategy Build Expand assets to $1.8B to $2.0B Explore new LPO markets and small bank acquisitions Convert LPO operations in Stevens Point to full-service branch Expand and build out our successful private banking == team Manage cash resources needed for acquisitions and share repurchase
Slide 20: Pat Heier, Senior Vice President
Pat Heier — Senior Vice President Commercial Banking
Slide 21: Managing Loan Quality
Managing Loan Quality
Slide 22: Balance Sheet Assets
Balance Sheet Assets (12/31/21 Per Audited Statements) (000) Cash and Cash Equivalents $53,543 Investments 308,744 Loans (Net) 876,337 Commercial 740,176 Retail Mortgage Loans 224,827 Other (Loans in Progress & ALLL) (88,666) Other 60,087 Total Assets $1,298,711
Slide 23: Credit Culture “The Credit Box”
Credit Culture “The Credit Box”
Slide 24: “The Credit Box”
“The Credit Box” Small Bank Character Lending Limited Underwriting Peoples Strong Managers - Good Balance Sheets - Capital Sources Big Banks • Limited Industry Appetite • Specific Cash Flow and Collateral Requirements • Very Little Deviation in their Appetite for credit
Slide 25: Loan Policy
Loan Policy PSB Holdings, Inc. -
Slide 26: Credit Delivery
Credit Delivery PSB Holdings, Inc.
Slide 27: Credit Delivery
Credit Delivery Board Loan Committee Officer’s Loan Committee Chief Credit Officer Well–Trained Credit Analysts Well–Trained Commercial Bankers As Business Professionals
Slide 28: Charge-Off History vs Peers
Charge-Off History vs Peers 0.40% 0.30% 0.21% 0.17% 0.20% 0.11% 0.11% 0.11% 0.11% 0.18% 0.08% 0.06% 0.10% 0.01% 0.02% 0.09% 0.06% 0.08% -0.04% 0.00% 0.05% -0.10% -0.20% -0.30% Net Charge-offs/Ave Loans Peer Net Charge-offs/Ave Loans 2014 2015 2016 2017 2018 2019 2020 2021 Peers include all publicly-
Slide 29: Jeff Musa, Regional President
Jeff Musa — Regional President Southeast Wisconsin
Slide 30: Taking a Different Approach
Taking a Different Approach PSB Holdings, Inc.
Slide 31: SE Wisc. Balance Sheet
SE Wisc. Balance Sheet • Gross Loans as of December 31, 2021 $182 Million Waukesha - $71 Million West Allis - $111 Million • Total Deposits as of December 31, 2021 $129 Million Waukesha - $108 Million West Allis - $21 Million
Slide 32: SE Wisc. Market
SE Wisc. Market • Continued Momentum in 2022 YTD commercial loan closing of $18 Million in new money booked through March 31, 2022 Equates to 45% of the bank-wide production of new money through the period
Slide 33: 2021 Highlights - Southeast Market Success
2021 Highlights - Southeast Market Success
Slide 34: Building Shareholder Value
Building Shareholder Value
Slide 35: Investment Appeal
Investment Appeal Proven long term shareholder value: • Customer and community-focused. An investment in Peoples State Bank is an investment in your community. • Relationship based collaborative model • Diversified customer base, markets, and fee income sources • Up to date on technology investments
Slide 36: Investment Appeal
Investment Appeal 10-year lookback through 12/31/2021
Slide 37: Price to Tangible Net Book Value
Price to Tangible Net Book Value Price as % of Tangible Net Book Value 160% 140% 120% 113% 108% 100% 80% 60% 40% 20% 0% 12/31/2017 12/31/2018 12/31/2019 12/31/2020 12/31/2021 PSB Holdings, Inc. S&P Global Peer Median $1.0B-$1.5B Assets
Slide 38: Price to Prior Year Earnings
Price to Prior Year Earnings Price as multiple of Prior Year earnings (P/E Ratio) 16 14 12 10 9.5 9.0 8 6 4 2 0 12/31/2017 12/31/2018 12/31/2019 12/31/2020 12/31/2021 PSB Holdings, Inc. S&P Global Peer Median $1.0B-$1.5B Assets
Slide 39: Shareholder Buyback Activity
Shareholder Buyback Activity • 14,593 shares repurchased in 2021 • “Walk-in” buyback program for “registered shareholders” • Recurring quarterly buyback of open market shares
Slide 40: Annual Business Meeting
Annual Business Meeting New ballots mailed on April 11 Tabulation to be made May 13
Slide 41: Questions? Answers
Questions? Answers
Slide 42: Thank you!
Thank you!