CF Bankshares (CFBK) 8-K Completion of Acquisition or Disposition of Assets

Exhibit 99.2

CF Bankshares Inc.

Pro Forma Consolidated Balance Sheet

At March 31, 2021

($ in thousands)

(unaudited)

	As Reported		Pro Forma Adjustments			Pro Forma
ASSETS
Cash and cash equivalents	$	125,814	$	(76,473	)(a)	$	49,341
Interest-bearing deposits in other financial institutions		100		—			100
Securities available for sale		9,738		—			9,738
Equity securities		5,000		—			5,000
Loans held for sale, at fair value		430,453		—			430,453
Loans and leases, net of allowance of $17,086		966,802		(30,826	)(b)		935,976
FHLB and FRB stock		6,164		—			6,164
Premises and equipment, net		3,769		(361	)(c)		3,408
Operating lease right-of-use assets		1,537		—			1,537
Bank owned life insurance		25,302		—			25,302
Accrued interest receivable and other assets		29,958		(207	)(d)		29,751
Total assets	$	1,604,637	$	(107,867	)	$	1,496,770
LIABILITIES AND STOCKHOLDERS’ EQUITY
Deposits
Noninterest bearing	$	216,935	$	(11,497	)(e)	$	205,438
Interest bearing		1,103,445		(96,377	)(e)		1,007,068
Total deposits		1,320,380		(107,874	)		1,212,506
FHLB advances and other debt		137,894		—			137,894
Advances by borrowers for taxes and insurance		921		19	(f)		940
Operating lease liabilities		1,672		—			1,672
Accrued interest payable and other liabilities		12,265		(12	)(g)		12,253
Subordinated debentures		14,854		—			14,854
Total liabilities		1,487,986		(107,867	)		1,380,119
Stockholders’ equity		116,651		—			116,651
Total liabilities and stockholders’ equity	$	1,604,637	$	(107,867	)	$	1,496,770

CF Bankshares Inc.

Pro Forma Consolidated Income Statement

Three Months Ended March 31, 2021

($ in thousands except per share data)

(unaudited)

	As Reported		Pro Forma Adjustments			Pro Forma
Interest and dividend income
Loans and leases, including fees	$	12,641	$	(296	)(h)	$	12,345
Securities		133		—			133
FHLB and FRB stock dividends		55		—			55
Federal funds sold and other		28		—			28
		12,857		(296	)		12,561
Interest expense
Deposits		2,497		(200	)(h)		2,297
FHLB advances and other debt		519		—			519
Subordinated debentures		224		—			224
		3,240		(200	)		3,040
Net interest income		9,617		(96	)		9,521
Provision for loan and lease losses		—					—
Net interest income after provision for loan and lease losses		9,617		(96	)		9,521
Noninterest income
Service charges on deposit accounts		193		(32	)(h)		161
Net gains on sales of loans		6,360		—			6,360
Swap fee income		182		—			182
Gain on redemption of life insurance policies		380		—			380
Earnings on bank owned life insurance		90		—			90
Other		25		(1	)(h)		24
		7,230		(33	)		7,197
Noninterest expense
Salaries and employee benefits		4,609		(78	)(h)		4,531
Occupancy and equipment		322		(37	)(h)		285
Data processing		536		(8	)(h)		528
Franchise and other taxes		239		—			239
Professional fees		1,215		(2	)(h)		1,213
Director fees		152		—			152
Postage, printing and supplies		39		(7	)(h)		32
Advertising and marketing		1,244		—			1,244
Telephone		59		(9	)(h)		50
Loan expenses		57		(6	)(h)		51
Depreciation		97		(14	)(h)		83
FDIC premiums		239		—			239
Regulatory assessment		65		—			65
Other insurance		28		—			28
Other		68		(2	)(h)		66
		8,969		(163	)		8,806
Income before incomes taxes		7,878		34			7,912
Income tax expense		1,457		7	(h)		1,464
Net income		6,421		27			6,448
Earnings allocated to participating securities (Series C preferred stock)		—		—			—
Net income attributable to common stockholders	$	6,421	$	27		$	6,448
Earnings per common share:
Basic	$	0.98	$	0.01		$	0.99
Diluted	$	0.96	$	0.01		$	0.97

CF Bankshares Inc.

Pro Forma Consolidated Income Statement

Year Ended December 31, 2020

($ in thousands except per share data)

(unaudited)

	As Reported			Pro Forma Adjustments			Pro Forma
Interest and dividend income
Loans and leases, including fees	$	41,851		$	(931	)(h)	$	40,920
Securities		161			—			161
FHLB and FRB stock dividends		199			—			199
Federal funds sold and other		175			—			175
		42,386			(931	)		41,455
Interest expense
Deposits		11,911			(1,246	)(h)		10,665
FHLB advances and other debt		1,729			—			1,729
Subordinated debentures		938			—			938
		14,578			(1,246	)		13,332
Net interest income		27,808			315			28,123
Provision for loan and lease losses		10,915			—			10,915
Net interest income after provision for loan and lease losses		16,893			315			17,208
Noninterest income
Service charges on deposit accounts		633			(105	)(h)		528
Net gains on sales of loans		58,366			—			58,366
Earnings on bank owned life insurance		145			—			145
Swap fee Income		651			—			651
Other		198			(5	)(h)		193
		59,993			(110	)		59,883
Noninterest expense
Salaries and employee benefits		21,987			(269	)(h)		21,718
Occupancy and equipment		1,077			(119	)(h)		958
Data processing		1,812			(26	)(h)		1,786
Franchise and other taxes		740			—			740
Professional fees		5,070			(2	)(h)		5,068
Director fees		648			—			648
Postage, printing and supplies		172			(42	)(h)		130
Advertising and marketing		5,624			(4	)(h)		5,620
Telephone		219			(56	)(h)		163
Loan expenses		304			(21	)(h)		283
Depreciation		381			(55	)(h)		326
FDIC premiums		588			—			588
Regulatory assessment		181			—			181
Other insurance		106			—			106
Other		1,694			(274	)(h)		1,420
		40,603			(868	)		39,735
Income before incomes taxes		36,283			1,073			37,356
Income tax expense		6,675			225	(h)		6,900
Net income		29,608			848			30,456
Earnings allocated to participating securities (Series C preferred stock)		(2,280	)		(65	)		(2,345	)
Net income attributable to common stockholders	$	27,328		$	783		$	28,111
Earnings per common share:
Basic	$	4.53		$	0.13		$	4.66
Diluted	$	4.47		$	0.13		$	4.60

CF Bankshares Inc.

Notes to Unaudited Pro Forma Consolidated Financial Statements

Note 1 – Basis of Presentation

The accompanying unaudited pro forma consolidated financial statements which include CF Bankshares Inc. (the “Company”) and its wholly-owned subsidiary, CFBank, National Association (“CFBank”), were derived from the Company’s historical consolidated financial statements. The unaudited pro forma balance sheet as of March 31, 2021 and the unaudited pro forma income statements for the three month period ended March 31, 2021 and the year ended December 31, 2020 have been adjusted to reflect the completion of the sale of CFBank’s two Columbiana County, Ohio branches (the “Branches”) to Consumers National Bank (“Consumers”). This transaction closed on July 16, 2021 and is anticipated to result in a pre-tax deposit premium of approximately $1.9 million. The estimated gain is not included in the pro forma consolidated financial statements. During the three months ended June 30, 2021, CFBank purchased $15.2 million in additional subordinated debt securities to replace the securities that were sold to Consumers as part of this transaction. The additional purchases and any related income from those additional securities are not reflected in the pro forma consolidated financial statements.

Pursuant to the terms of the Branch Purchase and Assumption Agreement dated as of December 29, 2020 (the “P&A Agreement”) between CFBank and Consumers, upon the closing of the Branch Sale on July 16, 2021, CFBank sold and transferred to Consumers the land, buildings, fixtures, equipment and other associated assets of the Branches; $104.3 million in deposits attributable to the Branches; $15.0 million in aggregate principal amount of subordinated debt securities issued by unrelated financial institutions and held in CFBank’s portfolio; $2.5 million in aggregate principal amount of loans attributable to the Branches; and $10.7 million in aggregate principal amount of single family residential mortgage loans and home equity lines of credit from CFBank’s Northeast Ohio loan portfolio. In exchange, Consumers paid to CFBank the net book value of the land, building, fixtures, equipment and other associated assets of the Branches, a deposit premium in the amount of approximately $1.9 million (equal to 1.75% of the average daily deposits of the Branches calculated over a 30 day period prior to the closing), and the par value of the subordinated debt securities and loans acquired by Consumers.

The unaudited pro forma consolidated financial statements are furnished for informational purposes only and do not purport to reflect the Company’s financial position and results of operations had the dispositions occurred on the dates as indicated above. Further, these financial statements are not necessarily indicative of the Company’s future financial position or future results of operations and should be read in conjunction with the historical financial statements of the Company included in its Annual Report on Form 10-K for the year ended December 31, 2020.

Note 2 – Pro Forma Adjustments

The proforma adjustments are based on preliminary estimates and assumptions that are subject to change. The following adjustments have been reflected in the unaudited pro forma consolidated financial information:

(a) Represents the net cash that would have been transferred to Consumers if the sale would have closed on March 31, 2021.

(b) Represents the March 31, 2021 aggregate principal balance of: (i) loans attributable to the Branches; (ii) single family residential mortgage loans and home equity lines of credit from CFBank’s Northeast Ohio loan portfolio selected to be transferred to Consumers as part of the P&A Agreement; and (iii) $15 million in aggregate principal amount of subordinated debt securities issued by unrelated financial institutions and held in CFBank’s portfolio.

(c) Represents the March 31, 2021 net book value of the land, building, fixtures, equipment and other associated assets of the Branches.

(d) Represents the accrued interest receivable at March 31, 2021 on the loans to be sold and transferred to Consumers.

(e) Represents the March 31, 2021 balances of deposits attributable to the Branches.

(f) Represents the March 31, 2021 balances of escrow deposits on loans to be sold and transferred to Consumers.

(g) Represents the accrued interest payable at March 31, 2021 on the deposits attributable to the Branches.

(h) Represents the income and expenses associated with the deposits and loans attributable to the branches, single family residential mortgage loans and home equity lines of credit from CFBank’s Northeast Ohio loan portfolio selected to be transferred to Consumers as part of the P&A Agreement, and $15 million in aggregate principal amount of subordinated debt securities issued by unrelated financial institutions and held in CFBank’s portfolio.