Exhibit 99.2
Q3 2024 Earnings Release BSVN October 11, 2024
BSVN – Corporate Overview Consistently ranked by S & P Global Market Intelligence as one of the Top Performing Community Banks in the United States Consistently produce top quartile(3) earnings and ROATCE Proven ability to maintain a healthy net interest margin through challenging interest rate cycles Abundant liquidity and a properly matched balance sheet Disciplined credit culture that adheres to a robust risk management framework Experienced and talented bankers focused on high-touch personalized service, targeting entrepreneurs and their commercial banking needs Positioned in dynamic markets with a commercial banking emphasis delivering services via a branch-lite model Shareholder alignment due to 56% insider ownership Dollars in thousands, all data as of September 30, 2024, unless indicated otherwise Pre-provision, pre-tax earnings (“PPE”) is a non-GAAP financial measure. See appendix for reconciliation to their most comparable GAAP measure Diluted earnings per share, as presented See slide 4 for the corresponding comparison between BSVN and peer group Bank7 Branch Dallas / Fort Worth Tulsa Oklahoma City
Q3 Overview Asset Quality & CRE Dollars in thousands, all data as of September 30, 2024, unless indicated otherwise Gross revenue of $2.93 million and gross expense of $1.16 million; pre-tax net income of $1.77 million and net income of $1.35 million. Net interest income excluding loan fees is a non-GAAP financial measure. See appendix for reconciliation to the most comparable GAAP measure See slide 10 for adjusted uninsured deposit calculation $1.02 billion of gross loans reprice daily, with $33.09 million of those loans that are at their floor Q3 EPS of $1.24, a 0.81% increase from Q2 2024; excluding net income from oil and gas(1), core banking EPS was $1.12 Low efficiency ratio of 37.87% Net interest margin, excluding loan fee income(2), decreased 2bps to 4.65% as compared to Q2 2024 Disciplined balance sheet management continues to produce a steady net interest margin which drives earnings EPS results were achieved through core earnings with no shares repurchased Record EPS & Reliable Net Interest Margin CET1 Capital: 12.92% Tier 1 Leverage: 11.64% TCE/TA: 11.25% Exceptional earnings and low dividend payout ratio builds capital rapidly Capital ratios far exceed “well capitalized” regulatory guidelines Debt free Balance Sheet, and no HTM securities Prudent Capital Management Uninsured deposits represent 22.61% of total deposits, and adjusted uninsured deposits represent 16.12% of total deposits(3) The sum of cash plus unpledged securities and undrawn lines-of-credit equals $711.54 million, which significantly exceeds adjusted uninsured deposits of $245.75 million(3), a 2.90x coverage $1.20 billion or 83.19% of loans reprice in 1 year or less, with $1.02 billion(4) or 70.92% repricing daily AOCI is only $4.12 million; the average investment portfolio duration is ~3.3 years Consistent Balance Sheet Management & Liquidity NPLs to Total Loans of 0.54% Diverse CRE portfolio primarily located in the DFW and Oklahoma City Metros Office Loan Average Size, excluding construction is $0.79 million: Owner Occupied — $0.65 million Non-Owner Occupied — $1.10 million
Maximizing Our Employee Base (3) PPE(1) 1.61% increase Strength in Core Earnings 10.44% increase Dollars are in millions Financial data is as of or for the twelve months ended December 31 of each respective year, and as of or for the three and nine months ended September 30, 2023 and September 30, 2024, and for the three months ended June 30, 2024 Pre-provision, pre-tax earnings (“PPE”) is a non-GAAP financial measure. See appendix for reconciliation to their most comparable GAAP measure Pro Forma 2019 is a non-GAAP financial measure which adds back the one-time, extraordinary compensation expense related to the non-cash executive stock transaction that took place during the period. See 2019 Pro Forma Net Income reconciliation table for detailed calculation of this measure Pro Forma noninterest expense to average assets is a non-GAAP financial measure. See appendix for reconciliation to their most comparable GAAP measure Pro Forma $26.8 $15.1 Strong PPE: Quarterly PPE of $15.50 million, an increase of 1.61% as compared to quarterly Q2 2024 YTD PPE of $45.64 million, an increase of 10.44% as compared to YTD Q3 2023 PPE was driven by: Disciplined loan pricing Asset sensitive balance sheet Expense controls We achieve maximum productivity by: Hiring fewer but better FTEs Operating an efficient delivery system with a strict adherence to process 3.56% Actual Pro Forma 2 2
Consistently Outperforming our Peer Group Income Statement as a Percentage of Average Assets PPE to Average Assets vs Peers Dollars are in thousands Peer group is defined as exchange-traded banks nationwide with assets between $500mm-$5bn (145 banks); Source: S&P Global Market Intelligence. As of Q2 2024, the latest data available.
Return on Average Tangible Common Equity (1) 5 year average: 20.5% Efficiency Ratio (1) 5 year average: 37.3% Return on Average Assets (1) 5 year average: 2.1% Consistent Top Performer Financial data is as of or for the twelve months ended December 31 of each respective year and as of or for the three months ended September 30, 2024 and June 30, 2024 Pro Forma ROAA, ROATCE and efficiency ratio are non-GAAP financial measures, see Appendix for reconciliation to the most comparable GAAP measures for these metrics 20.90% Pro Forma 2.51% 1.03% Pro Forma Industry-leading performance ratios remain top-tier and within our historical ranges Pro Forma 8.60% 38.83%
Diluted Earnings Per Share 0.81% Increase Pro Forma $0.81 Tangible Book Value Per Share CAGR since 2018: 17.0% Record EPS: $1.24 for Q3, a 0.81% increase from Q2 2024; excluding net income from oil and gas, we achieved a core banking EPS of $1.12 $3.68 for Q3 YTD, an 25.24% increase from YTD Q3 2023 No share repurchases since 2020 Reliable and Rapid Capital Compounder Dollars are in thousands, except for per share data Pro Forma 2019 is a non-GAAP financial measure which adds back the one-time, extraordinary compensation expense related to the non-cash executive stock transaction that took place during the period See 2019 Pro Forma Net Income reconciliation table for detailed calculation of this measure TBV per share of $20.85, an increase of $3.37 or 19.25% as compared to YE 2023 Consistently strong earnings increased TBV despite three factors: $0.85 per share paid for an all-cash acquisition in Q4 2021 $0.44 per share AOCI unrealized loss from investments $3.33 per share paid in cash dividends, since IPO 1
CAGR since 2018: 15.6% BSVN Compared to All Major Exchange Traded Banks Source: S&P Global Market Intelligence and FactSet; Market data as of 9/30/2024 Total shareholder return includes the reinvestment of dividends Public banks include all major exchange-traded banks nationwide (317 banks) Total Shareholder Return Since BSVN’s IPO (9/2018) BSVN’s TBVPS Since FYE 2018 (1) $100 invested in BSVN since IPO would be worth $231.99 now $100 invested in an index of all public banks since BSVN’s IPO would be worth $113.51 now BSVN: 132.0% Median: 13.5% 118.5% Outperformance Public Banks Median CAGR: 5.6%(1)
Consistent Net Interest Margin Financial data is as of or for the twelve months ended December 31 of each respective year and as of or for the three months ended June 30, 2024 and September 30,2024 Net interest margin (excluding loan fee income) is a non-GAAP financial measure, see Appendix for reconciliation to the most comparable GAAP measure for this metric ◼︎ Loan Fee Income Contribution Net interest margin remains within our historical range due to disciplined loan pricing, a healthy amount of non-interest bearing deposits, and our asset sensitive balance sheet The 50 basis point (bps) rate cut during the quarter had a neutral impact on net interest margin; loan yields concluded the quarter at 7.86%, marking a 32 bps reduction from immediately before the rate cut. This represents a 64% beta relative to the full rate cut. Concurrently, the cost of funds (COF) for deposits finished the quarter at 3.00%, also down 32 bps from pre-cut levels, reflecting a 64% beta. Q3 average loan yields increased 10 bps to 8.18% and cost of funds increased 22 bps to 3.23% and was due to a continued shift to interest-bearing deposits There are currently $33.09 million of loan floaters at their floor; this increases to $124.87 million at their floor with another 100 bps in rate cuts; and increases to $459.77 million with 200 bps in rate cuts
We Achieve a Steady Spread thru Various Rate Cycles
Asset Sensitivity Repricing and Liquidity Dollars in thousands, all data as of September 30,2024, unless indicated otherwise $1.02 billion of gross loans reprice daily, with $33.09 million of those loans that are at their floor Asset Sensitivity Repricing Schedule (1) 70.92% of all earning assets reprice within one year or less and combined with a properly matched balance sheet, are key drivers of our consistent net interest margin Uninsured deposits total $344.61 million or 22.61% of total deposits; however, after deductions for insider owned, and also collateralized deposits, adjusted uninsured deposits are $245.75 million, which is 16.12% of total deposits Cash, securities, and undrawn lines of credit totaled $711.54 million, providing a 2.90x coverage of adjusted uninsured deposits Uninsured Deposits | Cash/Liquidity Liquidity
Deposit Composition Deposit Composition CAGR since 2019: 13.0% Dollars in millions Decrease in non-interest bearing deposits, as compared to 2023, relates to a $100.00 million deposit that was directed to BSVN by a bankruptcy court which has now been dispersed 1
Loan Portfolio Trends Loan Portfolio Trends – Selected Categories Dollars are in millions CAGR Since 2019: 13.2% 12.0% 26.1% 20.4% 41.6%
Loan Portfolio Distribution Dollars are in millions. Data as of September 30, 2024 Loan Portfolio Selected Categories
Diverse CRE Portfolio with Very Low Historical Losses Dollars are in millions. Data as of September 30, 2024 Diverse commercial real estate lending activity in Texas and Oklahoma with an emphasis in the DFW, Oklahoma City, and Tulsa metros Minimal office loans No office exposure to downtown metropolitan locations Office Loan Average Size, excluding construction is $0.79 million: Owner Occupied — $0.65 million Non-Owner Occupied — $1.10 million Construction lending activity primarily in Oklahoma City and the Dallas metroplex with an emphasis on entry level homes with established homebuilders Limited lot and development lending activity Hospitality niche managed by seasoned professionals with proven track record through various economic cycles CONSTRUCTION OWNER OCCUPIED
Hotel Portfolio by Class Hotel Portfolio by Location Hospitality Loan Portfolio – A Source of Strength Dollars are in millions. Data as of September 30, 2024 No historical NCOs in the hospitality segment Blue collar portfolio that is well-protected by the “cycle-down” effect of a recession Geographically concentrated in TX (82%) and other markets with favorable economic conditions Loans personally guaranteed by experienced owner/operators with operating history spanning decades of economic cycles Diversified lending to many reputable brands Consistent underwriting fundamentals with disciplined equity requirements, debt coverage ratio requirements, personal recourse, and rapid amortization Average loan size of $5.71 million 3.56% Actual Hotel Portfolio by Location
Total Assets Strategic Growth in Dynamic Markets Dollars are in millions 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Q3 2024 LPO opened in Tulsa, OK, full-service branch opened in Frisco, TX Oklahoma acquisition Full-service branch opened in Tulsa, OK Completed IPO Full-service branch opened in Irving, TX LPO opened in Irving, TX Kansas acquisition CAGR Since 2014: 14.2%
Earnings-driven Capital Shock-absorption Earnings-driven cushion far exceeds regulatory capital minimums as illustrated over a two-year period, consistent with DFAST parameters(1) Dollars are in thousands above assumes no cash dividends and is simply an illustration and should not be considered a projection or forward-looking guidance of any kind DFAST = Dodd-Frank Act Stress Test Excess capital to target ratio expressed in % is the difference between the actual ratio and regulatory minimum divided by the regulatory minimum Excess capital to target ratio expressed in $ is the excess capital % multiplied by either average assets or risk-weighted assets, assuming a static balance sheet over the next 24 months Trailing twelve months PPE of $62.7 million extrapolated over two years
Appendix
Bank7 Corp. Financials BSVN adopted the CECL model (ASC326) on 1/1/2023 using the modified retrospective method. The presented allowance for periods prior to 1/1/2023 is under the incurred loss model (pre-ASC326). Represents a non-GAAP financial measure. See non-GAAP reconciliations table for reconciliation to most comparable GAAP measure for this metric All pro forma amounts relate to the one-time, non-cash executive stock transfer which occurred in September 2019. These amounts remove the compensation and related tax impact from net income. See detail and reconciliation on slide 25 of this presentation
Bank7 Corp. Performance Ratios Annualized Efficiency ratio is calculated by dividing noninterest expense by the sum of net interest income on a tax equivalent basis and noninterest income Represents a non-GAAP financial measure, see non-GAAP reconciliations table for reconciliation to the most comparable GAAP measure for this metric Ratios are based on Bank level financial information rather than consolidated information. At September 30, 2024, Tier 1 leverage ratio, Tier 1 risk based capital ratio, and total risk-based capital ratios were 11.64%, 12.92%, and 14.11% respectively for the Company All pro forma amounts relate to the one-time, non-cash executive stock transfer which occurred in September 2019. These amounts remove the compensation expense and related tax impact from net income. See detail and reconciliation on slide 25 of this presentation
Non-GAAP Reconciliations
Non-GAAP Reconciliations -- Continued
Oil & Gas – Cash Flow Recap
Available-for-Sale Securities Portfolio Investment Portfolio Dollars are in millions. All mortgage-backed securities and collateralized mortgage obligations are issued and/or guaranteed by U.S. government agencies or U.S. government-sponsored entities. Total investment securities of $65.2 million as of September 30, 2024 Weighted Average Duration: 3.3 Years Book Yield: 2.04%
2019 Pro Forma Net Income Reconciliation On September 5, 2019, the largest shareholders, Haines Family Trusts, contributed approximately 6.5% of their shares (656,925 shares) to the Company. Subsequently, the Company immediately issued those shares to certain executive officers, which was charged as compensation expense of $11.8 million, including payroll taxes, through the income statement of the Company. Additionally, at the discretion of the employees receiving shares to assist in paying tax withholdings, 149,425 shares were withheld and subsequently canceled, resulting in a charge to retained earnings of $2.6 million.
Legal Information and Distribution This presentation and oral statements made regarding the subject of this presentation contain forward-looking statements. These forward-looking statements are subject to significant uncertainties because they are based upon: the amount and timing of future changes in interest rates, market behavior, and other economic conditions; future laws, regulations, and accounting principles; changes in regulatory standards and examination policies, and a variety of other matters. These other matters include, among other things, the impact of COVID-19 on the United States economy and our operations, the direct and indirect effect of economic conditions on interest rates, credit quality, loan demand, liquidity, and monetary and supervisory policies of banking regulators. These forward-looking statements reflect Bank7 Corp.’s current views with respect to, among other things, future events and Bank7 Corp.’s financial performance. Any statements about Bank7 Corp.’s expectations, beliefs, plans, predictions, forecasts, objectives, assumptions or future events or performance are not historical facts and may be forward-looking. These statements are often, but not always, made through the use of words or phrases such as “anticipate,” “believes,” “can,” “could,” “may,” “predicts,” “potential,” “should,” “will,” “estimate,” “plans,” “projects,” “continuing,” “ongoing,” “expects,” “intends” and similar words or phrases. Any or all of the forward-looking statements in (or conveyed orally regarding) this presentation may turn out to be inaccurate. The inclusion of or reference to forward-looking information in this presentation should not be regarded as a representation by Bank7 Corp. or any other person that the future plans, estimates or expectations contemplated by Bank7 Corp. will be achieved. Bank7 Corp. has based these forward-looking statements largely on its current expectations and projections about future events and financial trends that Bank7 Corp. believes may affect its financial condition, results of operations, business strategy and financial needs. Bank7 Corp.’s actual results could differ materially from those anticipated in such forward-looking statements as a result of risks, uncertainties and assumptions that are difficult to predict. If one or more events related to these or other risks or uncertainties materialize, or if Bank7 Corp.’s underlying assumptions prove to be incorrect, actual results may differ materially from what Bank7 Corp. anticipates. You are cautioned not to place undue reliance on forward-looking statements. Further, any forward-looking statement speaks only as of the date on which it is made and Bank7 Corp. undertakes 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, except as may be required by law. All forward-looking statements herein are qualified by these cautionary statements. Within this presentation, we reference certain market, industry and demographic data, forecasts and other statistical information. We have obtained this data, forecasts and information from various independent, third party industry sources and publications. Nothing in the data, forecasts or information used or derived from third party sources should be construed as advice. Some data and other information are also based on our good faith estimates, which are derived from our review of industry publications and surveys and independent sources. We believe that these sources and estimates are reliable, but have not independently verified them. Statements as to our market position are based on market data currently available to us. Although we are not aware of any misstatements regarding the economic, employment, industry and other market data presented herein, these estimates involve inherent risks and uncertainties and are based on assumptions that are subject to change. This presentation includes certain non-GAAP financial measures, including pro forma net income, tax-adjusted net income, tax-adjusted earnings per share, tax-adjusted return on average assets and tax-adjusted return on average shareholders’ equity. These non-GAAP financial measures and any other non-GAAP financial measures that we discuss in this presentation should not be considered in isolation, and should be considered as additions to, and not substitutes for or superior to, measures of financial performance prepared in accordance with GAAP. There are a number of limitations related to the use of these non-GAAP financial measures versus their nearest GAAP equivalents. For example, other companies may calculate non-GAAP financial measures differently or may use other measures to evaluate their performance, all of which could reduce the usefulness of Bank7 Corp.’s non-GAAP financial measures as tools for comparison. See the table in the appendix of this presentation for a reconciliation of the non-GAAP financial measures used in (or conveyed orally during) this presentation to their most directly comparable GAAP financial measures.
