Bridgewater Bancshares (BWB) 8-K Bridgewater Bancshares, Inc. Announces Fourth Quarter 2022 Net Income of $13.7 Million, $0.45 Diluted Earnings Per Common Share

Exhibit 99.1

Media Contact:
Jessica Stejskal | SVP Marketing
Jessica.stejskal@bwbmn.com | 952.893.6860 Investor Contact:
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Justin.Horstman@bwbmn.com | 952.542.5169

January 25, 2023

Bridgewater Bancshares, Inc. Announces Fourth Quarter 2022 Net Income
of $13.7 Million, $0.45 Diluted Earnings Per Common Share

Bridgewater Bancshares, Inc. (Nasdaq: BWB) (the Company), the parent company of Bridgewater Bank (the Bank), today announced net income of $13.7 million for the fourth quarter of 2022, a 5.4% decrease from net income of $14.5 million for the third quarter of 2022, and a 9.8% increase from net income of $12.5 million for the fourth quarter of 2021. Earnings per diluted common share for the fourth quarter of 2022 were $0.45, a 5.6% decrease compared to $0.47 per diluted common share for the third quarter of 2022, and a 14.2% increase compared to $0.39 per diluted common share for the same period in 2021.

“Bridgewater delivered another strong year of financial results in 2022 highlighted again by our robust balance sheet growth, highly efficient business model and superb asset quality, with all of these trends continuing in the fourth quarter” said Chairman, Chief Executive Officer and President, Jerry Baack. “As expected, we also saw net interest margin compression during the quarter as the persistent rising interest rate environment created additional funding pressure given our strong loan growth. While we expect the operating environment to remain challenging as we head into 2023, we are taking steps to actively manage our balance sheet in the near-term, with a focus on profitable growth, to drive sustained success over the long-term.”

Fourth Quarter 2022 Financial Results

						Diluted		Adjusted		Nonperforming
ROA		PPNR ROA (1)		ROE		earnings per share		efficiency ratio (1)		assets to total assets
1.28	%	1.82	%	14.06	%	$	0.45	43.5	%	0.01	%

(1) Represents a non-GAAP financial measure. See "Non-GAAP FinancialMeasures" for further details.

Fourth Quarter 2022 Highlights

● Diluted earnings per common share were $0.45, compared to $0.47 per common share for the third quarter of 2022

● Pre-provision net revenue (PPNR), a non-GAAP financial measure, of $19.5 million, compared to $21.4 million for the third quarter of 2022, a decrease of $1.9 million, or 9.0%. PPNR ROA, a non-GAAP financial measure, was 1.82%, compared to 2.15% for the third quarter of 2022.

● Annualized return on average assets (ROA) and annualized return on average shareholders’ equity (ROE) for the fourth quarter of 2022 were 1.28% and 14.06%, compared to ROA and ROE of 1.46% and 14.99%, respectively, for the third quarter of 2022. Annualized return on average tangible common equity, a non-GAAP financial measure, was 15.86% for the fourth quarter of 2022, compared to 17.03% for the third quarter of 2022.

● Gross loans increased $189.4 million, or 22.2% annualized, from the third quarter of 2022.

● Deposits increased $111.5 million, or 13.4% annualized, from the third quarter of 2022.

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● Net interest margin (on a fully tax-equivalent basis) was 3.16%, compared to 3.53% in the third quarter of 2022. Core net interest margin (on a fully tax-equivalent basis), a non-GAAP financial measure which excludes the impact of loan fees and PPP balances, interest, and fees, was 3.05%, compared to 3.38% in the third quarter of 2022.

● Adjusted efficiency ratio, a non-GAAP financial measure which excludes the impact of certain non-routine income and expenses from noninterest expense, was 43.5%, compared to 39.4% for the third quarter of 2022.

● A loan loss provision of $1.5 million was recorded to support strong organic loan growth in the fourth quarter of 2022. The allowance for loan losses to total loans was 1.34% at December 31, 2022, compared to 1.38% at September 30, 2022.

● Annualized net loan charge-offs (recoveries) as a percentage of average loans were 0.00% for the fourth quarter of 2022, compared to (0.03)% for the third quarter of 2022.

● Tangible book value per share, a non-GAAP financial measure, increased $0.36, or 12.7% annualized, to $11.69 at December 31, 2022, compared to $11.33 at September 30, 2022.

Annual 2022 Highlights

● Diluted earnings per common share for the year ended December 31, 2022 were $1.72, a 12.0% increase, compared to $1.54 for the year ended December 31, 2021.

● PPNR, a non-GAAP financial measure, was $79.7 million for the year ended December 31, 2022, an increase of 18.8%, compared to $67.1 million for the year ended December 31, 2021. PPNR ROA, a non-GAAP financial measure, was 2.06% for the year ended December 31, 2022, compared to 2.10% for the year ended December 31, 2021.

● Gross loans increased $750.0 million at December 31, 2022, or 26.6%, compared to December 31, 2021.

● Deposits increased $470.3 million at December 31, 2022, or 16.0%, compared to December 31, 2021.

● Net interest margin (on a fully tax-equivalent basis) was 3.45% for the year ended December 31, 2022, compared to 3.54% for the year ended December 31, 2021. Core net interest margin (on a fully tax-equivalent basis), a non-GAAP financial measure, for the year ended December 31, 2022 was 3.27%, compared to 3.28% for the year ended December 31, 2021.

● Adjusted efficiency ratio, a non-GAAP financial measure, was 41.2% for the year ended December 31, 2022, compared to 41.0% for the year ended December 31, 2021.

● Net loan charge-offs (recoveries) as a percentage of average loans were (0.01)% for the year ended December 31, 2022, compared to 0.00% for the year ended December 31, 2021.

● The ratio of nonperforming assets to total assets was 0.01% at December 31, 2022, compared to 0.02% at December 31, 2021.

● Tangible book value per share, a non-GAAP financial measure, increased $0.71, or 6.5%, to $11.69 at December 31, 2022, compared to $10.98 at December 31, 2021, despite the market value depreciation of the securities portfolio due to rapidly rising interest rates, which continue to negatively impact accumulated other comprehensive income.

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Key Financial Measures

	As of and for the Three Months Ended									As of and for the Year Ended
	December 31,			September 30,			December 31,			December 31,			December 31,
	2022			2022			2021			2022			2021
Per Common Share Data
Basic Earnings Per Share	$	0.46		$	0.49		$	0.41		$	1.78		$	1.59
Diluted Earnings Per Share		0.45			0.47			0.39			1.72			1.54
Book Value Per Share		11.80			11.44			11.09
Tangible Book Value Per Share (1)		11.69			11.33			10.98
Basic Weighted Average Shares Outstanding		27,558,983			27,520,117			28,004,334			27,758,336			28,027,454
Diluted Weighted Average Shares Outstanding		28,527,306			28,592,854			29,038,785			28,668,177			28,968,286
Shares Outstanding at Period End		27,751,950			27,587,978			28,206,566
Selected Performance Ratios
Return on Average Assets (Annualized)		1.28	%		1.46	%		1.46	%		1.38	%		1.43	%
Pre-Provision Net Revenue Return on Average Assets (Annualized) (1)		1.82			2.15			2.11			2.06			2.10
Return on Average Shareholders' Equity (Annualized)		14.06			14.99			13.27			13.90			14.45
Return on Average Tangible Common Equity (Annualized) (1)		15.86			17.03			14.78			15.69			15.45
Yield on Interest Earning Assets(2)		4.67			4.37			4.06			4.35			4.16
Yield on Total Loans, Gross(2)		4.87			4.59			4.49			4.60			4.60
Cost of Total Deposits		1.31			0.73			0.45			0.75			0.51
Cost of Funds		1.67			0.93			0.61			0.99			0.68
Net Interest Margin (2)		3.16			3.53			3.51			3.45			3.54
Core Net Interest Margin (1)(2)		3.05			3.38			3.25			3.27			3.28
Efficiency Ratio (1)		43.8			39.8			40.8			41.5			42.0
Adjusted Efficiency Ratio (1)		43.5			39.4			40.3			41.2			41.0
Noninterest Expense to Average Assets (Annualized)		1.42			1.42			1.45			1.46			1.51
Adjusted Noninterest Expense to Average Assets (Annualized) (1)		1.41			1.41			1.43			1.45			1.47
Loan to Deposit Ratio		104.5			102.3			95.7
Core Deposits to Total Deposits (3)		74.6			83.0			85.4
Tangible Common Equity to Tangible Assets (1)		7.48			7.57			8.91
Capital Ratios (Bank Only) (4)
Tier 1 Leverage Ratio		10.76	%		11.24	%		11.09	%
Common Equity Tier 1 Risk-based Capital Ratio		11.29			11.46			11.69
Tier 1 Risk-based Capital Ratio		11.29			11.46			11.69
Total Risk-based Capital Ratio		12.47			12.67			12.94
Capital Ratios (Consolidated) (4)
Tier 1 Leverage Ratio		9.55	%		9.98	%		10.82	%
Common Equity Tier 1 Risk-based Capital Ratio		8.40			8.47			9.36
Tier 1 Risk-based Capital Ratio		10.03			10.19			11.43
Total Risk-based Capital Ratio		13.15			13.78			15.55

(1) Represents a non-GAAP financial measure. See "Non-GAAP FinancialMeasures" for further details.

(2) Amounts calculated on a tax-equivalent basis using the statutory federal tax rate of 21%.

(3) Core deposits are defined as total deposits less brokered deposits and certificates of deposit greater than $250,000.

(4) Preliminary data. Current period subject to change prior to filings with applicable regulatory agencies.

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Selected Financial Data

	December 31,		September 30,		June 30,		March 31,		December 31,
(dollars in thousands)	2022		2022		2022		2022		2021
Selected Balance Sheet Data
Total Assets	$	4,345,662	$	4,128,987	$	3,883,264	$	3,607,920	$	3,477,659
Total Loans, Gross		3,569,446		3,380,082		3,225,885		2,987,967		2,819,472
Allowance for Loan Losses		47,996		46,491		44,711		41,692		40,020
Goodwill and Other Intangibles		2,914		2,962		3,009		3,057		3,105
Deposits		3,416,543		3,305,074		3,201,953		3,035,611		2,946,237
Tangible Common Equity (1)		324,636		312,531		305,360		309,870		309,653
Total Shareholders' Equity		394,064		382,007		374,883		379,441		379,272
Average Total Assets - Quarter-to-Date		4,251,345		3,948,201		3,743,575		3,513,798		3,403,270
Average Shareholders' Equity - Quarter-to-Date		387,589		384,020		381,448		383,024		374,035

(1)Represents a non-GAAP financial measure. See "Non-GAAP FinancialMeasures" for further details.

	For the Three Months Ended						For the Year Ended
	December 31,		September 30,		December 31,		December 31,		December 31,
(dollars in thousands)	2022		2022		2021		2022		2021
Selected Income Statement Data
Interest Income	$	48,860	$	42,359	$	33,775	$	163,695	$	128,879
Interest Expense		15,967		8,264		4,622		33,997		19,370
Net Interest Income		32,893		34,095		29,153		129,698		109,509
Provision for Loan Losses		1,500		1,500		1,150		7,700		5,150
Net Interest Income after Provision for Loan Losses		31,393		32,595		28,003		121,998		104,359
Noninterest Income		1,738		1,387		1,288		6,332		5,309
Noninterest Expense		15,203		14,157		12,459		56,620		48,095
Income Before Income Taxes		17,928		19,825		16,832		71,710		61,573
Provision for Income Taxes		4,193		5,312		4,318		18,318		15,886
Net Income		13,735		14,513		12,514		53,392		45,687
Preferred Stock Dividends		(1,014)		(1,013)		(1,171)		(4,054)		(1,171)
Net Income Available to Common Shareholders	$	12,721	$	13,500	$	11,343	$	49,338	$	44,516

Income Statement

Net Interest Income

Net interest income was $32.9 million for the fourth quarter of 2022, a decrease of $1.2 million, or 3.5%, from $34.1 million in the third quarter of 2022, and an increase of $3.7 million, or 12.8%, from $29.2 million in the fourth quarter of 2021. The linked-quarter decrease in net interest income was due to higher rates paid on deposits and increased borrowings in the rising interest rate environment. The year-over-year increase in net interest income was primarily due to growth in average interest earning assets and higher yields on investment securities and core loans, offset partially by higher rates paid on deposits and borrowings. Average interest earning assets were $4.18 billion for the fourth quarter of 2022, an increase of $305.7 million, or 7.9%, from $3.87 billion for the third quarter of 2022, and an increase of $857.0 million, or 25.8%, from $3.32 billion for the fourth quarter of 2021. The linked-quarter increase in average interest earning assets was primarily due to strong organic growth in the loan portfolio and purchases of investment securities. The year-over-year increase in average interest earning assets was primarily due to strong organic growth in the loan portfolio and purchases of investment securities, offset partially by the forgiveness of PPP loans and the reduction of cash balances.

Net interest margin (on a fully tax-equivalent basis) for the fourth quarter of 2022 was 3.16%, a 37 basis point decrease from 3.53% in the third quarter of 2022, and a 35 basis point decrease from 3.51% in the fourth quarter of 2021. Core net interest margin (on a fully tax-equivalent basis), a non-GAAP financial measure which excludes the impact of loan fees and PPP balances, interest, and fees, for the fourth quarter of 2022 was 3.05%, a 33 basis point decrease from 3.38% in the third quarter of 2022, and a 20 basis point decrease from 3.25% in the fourth quarter of 2021. The Company remains focused on managing the impact of continued interest rate hikes and the evolving shape of the yield curve during this unique interest rate environment.

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As the PPP loan portfolio has almost fully paid off, the recognition of fees associated with the originations has decreased significantly, which impacts comparability between periods. The Company recognized $45,000 of PPP origination fees during the fourth quarter of 2022, compared to $90,000 during the third quarter of 2022, and $958,000 during the fourth quarter of 2021. There were no remaining PPP origination fees to be recognized as of December 31, 2022.

Interest income was $48.9 million for the fourth quarter of 2022, an increase of $6.5 million, or 15.3%, from $42.4 million in the third quarter of 2022, and an increase of $15.1 million, or 44.7%, from $33.8 million in the fourth quarter of 2021. The yield on interest earning assets (on a fully tax-equivalent basis) was 4.67% in the fourth quarter of 2022, compared to 4.37% in the third quarter of 2022, and 4.06% in the fourth quarter of 2021. The linked-quarter increase in the yield on interest earning assets was primarily due to the rapid increase in market interest rates resulting in new loan originations, loans repricing, and investment purchases at yields accretive to the existing portfolios. The year-over-year increase in the yield on interest earning assets was primarily due to growth and repricing of the loan and securities portfolios in the rising interest rate environment, offset partially by the lower recognition of PPP origination fees.

Loan interest income and loan fees remain the primary contributing factors to the changes in the yield on interest earning assets. The aggregate loan yield, excluding PPP loans, increased to 4.86% in the fourth quarter of 2022, which was 27 basis points higher than 4.59% in the third quarter of 2022, and 45 basis points higher than 4.41% in the fourth quarter of 2021. While loan fees have historically maintained a relatively stable contribution to the aggregate loan yield, the recent periods were impacted by fewer loan prepayments, which historically has accelerated the recognition of loan fees. Despite the decrease in fee recognition, the Company is encouraged that the core loan yield continues to rise as new loan originations and the existing portfolio loans reprice in the higher rate environment.

A summary of interest and fees recognized on loans, excluding PPP loans, for the periods indicated is as follows:

	Three Months Ended
	December 31, 2022		September 30, 2022		June 30, 2022		March 31, 2022		December 31, 2021
Interest	4.74	%	4.42	%	4.17	%	4.15	%	4.20	%
Fees	0.12		0.17		0.26		0.25		0.21
Yield on Loans, Excluding PPP Loans	4.86	%	4.59	%	4.43	%	4.40	%	4.41	%

Interest expense was $16.0 million for the fourth quarter of 2022, an increase of $7.7 million, or 93.2%, from $8.3 million in the third quarter of 2022, and an increase of $11.3 million, or 245.4%, from $4.6 million in the fourth quarter of 2021. The cost of interest bearing liabilities increased 92 basis points on a linked-quarter basis from 1.30% in the third quarter of 2022 to 2.22% in the fourth quarter of 2022, primarily due to higher rates paid on deposits, drawing on the Company’s revolving line of credit, and the increased utilization of federal funds purchased and FHLB advances in the rising interest rate environment. On a year-over-year basis, the cost of interest bearing liabilities increased 136 basis points from 0.86% in the fourth quarter of 2021 to 2.22% in the fourth quarter of 2022, primarily due to the rapid increase in market interest rates that occurred between the periods, which impacted all funding sources.

Interest expense on deposits was $10.8 million for the fourth quarter of 2022, an increase of $4.8 million, or 80.2%, from $6.0 million in the third quarter of 2022, and an increase of $7.5 million, or 232.6%, from $3.2 million in the fourth quarter of 2021. The cost of total deposits increased 58 basis points on a linked-quarter basis from 0.73% in the third quarter of 2022, to 1.31% in the fourth quarter of 2022. On a year-over-year basis, the cost of total deposits increased 86 basis points from 0.45% in the fourth quarter of 2021, to 1.31% in the fourth quarter of 2022. The linked-quarter and year-over-year increases were primarily due to the upward repricing of the deposit portfolio in the higher interest rate environment.

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A summary of the Company’s average balances, interest yields and rates, and net interest margin for the three months ended December 31, 2022, September 30, 2022, and December 31, 2021 is as follows:

	For the Three Months Ended
	December 31, 2022						September 30, 2022						December 31, 2021
	Average		Interest		Yield/		Average		Interest		Yield/		Average		Interest		Yield/
	Balance		& Fees		Rate		Balance		& Fees		Rate		Balance		& Fees		Rate
(dollars in thousands)
Interest Earning Assets:
Cash Investments	$	65,393	$	366	2.22	%	$	57,613	$	165	1.13	%	$	146,744	$	65	0.18	%
Investment Securities:
Taxable Investment Securities		540,601		5,268	3.87			461,255		3,741	3.22			341,325		1,893	2.20
Tax-Exempt Investment Securities (1)		67,867		728	4.26			75,801		799	4.18			71,602		782	4.33
Total Investment Securities		608,468		5,996	3.91			537,056		4,540	3.35			412,927		2,675	2.57
Paycheck Protection Program Loans (2)		1,109		48	17.06			2,424		96	15.75			39,900		1,057	10.51
Loans (1)(2)		3,481,041		42,654	4.86			3,263,390		37,724	4.59			2,715,722		30,154	4.41
Total Loans		3,482,150		42,702	4.87			3,265,814		37,820	4.59			2,755,622		31,211	4.49
Federal Home Loan Bank Stock		21,633		163	2.99			11,413		156	5.42			5,310		59	4.39
Total Interest Earning Assets		4,177,644		49,227	4.67	%		3,871,896		42,681	4.37	%		3,320,603		34,010	4.06	%
Noninterest Earning Assets		73,701						76,305						82,667
Total Assets	$	4,251,345					$	3,948,201					$	3,403,270
Interest Bearing Liabilities:
Deposits:
Interest Bearing Transaction Deposits	$	464,631	$	2,013	1.72	%	$	517,658	$	1,032	0.79	%	$	499,475	$	548	0.43	%
Savings and Money Market Deposits		1,048,227		4,533	1.72			999,932		2,494	0.99			803,848		876	0.43
Time Deposits		281,334		1,007	1.42			288,621		847	1.16			299,823		830	1.10
Brokered Deposits		537,351		3,228	2.38			447,034		1,612	1.43			404,438		987	0.97
Total Interest Bearing Deposits		2,331,543		10,781	1.83			2,253,245		5,985	1.05			2,007,584		3,241	0.64
Federal Funds Purchased		340,471		3,379	3.94	���		106,826		709	2.63			10		—	0.67
Notes Payable		11,359		202	7.04			—		—	—			—		—	—
FHLB Advances		94,103		575	2.42			72,343		328	1.80			44,185		162	1.46
Subordinated Debentures		81,242		1,030	5.03			92,503		1,242	5.33			92,189		1,219	5.25
Total Interest Bearing Liabilities		2,858,718		15,967	2.22	%		2,524,917		8,264	1.30	%		2,143,968		4,622	0.86	%
Noninterest Bearing Liabilities:
Noninterest Bearing Transaction Deposits		943,232						991,545						861,473
Other Noninterest Bearing Liabilities		61,806						47,719						23,794
Total Noninterest Bearing Liabilities		1,005,038						1,039,264						885,267
Shareholders' Equity		387,589						384,020						374,035
Total Liabilities and Shareholders' Equity	$	4,251,345					$	3,948,201					$	3,403,270
Net Interest Income / Interest Rate Spread				33,260	2.45	%				34,417	3.07	%				29,388	3.20	%
Net Interest Margin (3)					3.16	%					3.53	%					3.51	%
Taxable Equivalent Adjustment:
Tax-Exempt Investment Securities and Loans				(367)						(322)						(235)
Net Interest Income			$	32,893					$	34,095					$	29,153

(1) Interest income and average rates for tax-exempt investment securities and loans are presented on a tax-equivalent basis, assuming a statutory federal income tax rate of 21%.

(2) Average loan balances include nonaccrual loans. Interest income on loans includes amortization of deferred loan fees, net of deferred loan costs.

(3) Net interest margin includes the tax equivalent adjustment and represents the annualized results of: (i) the difference between interest income on interest earning assets and the interest expense on interest bearing liabilities, divided by (ii) average interest earning assets for the period.

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Provision for Loan Losses

The provision for loan losses was $1.5 million for both the third and fourth quarter of 2022 and $350,000 higher than the $1.2 million provided in the fourth quarter of 2021. The provision recorded in the fourth quarter of 2022 was primarily attributable to the growth of the loan portfolio. The allowance for loan losses to total loans was 1.34% at December 31, 2022, compared to 1.38% at September 30, 2022, and 1.42% at December 31, 2021.

As an emerging growth company, the Company anticipates adopting Accounting Standards Update No. 2016-13 “Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses of Financial Instruments,” as of January 1, 2023 and does not expect a material adjustment upon adoption. The current estimate and future calculations are highly dependent on loan composition, macroeconomic conditions and forecasts, and other management assumptions and judgements.

The following table presents the activity in the Company’s allowance for loan losses for the periods indicated:

	Three Months Ended						Year Ended
	December 31,		September 30,		December 31,		December 31,		December 31,
(dollars in thousands)	2022		2022		2021		2022		2021
Balance at Beginning of Period	$	46,491	$	44,711	$	38,901	$	40,020	$	34,841
Provision for Loan Losses		1,500		1,500		1,150		7,700		5,150
Charge-offs		(3)		(5)		(37)		(37)		(74)
Recoveries		8		285		6		313		103
Balance at End of Period	$	47,996	$	46,491	$	40,020	$	47,996	$	40,020

Noninterest Income

Noninterest income was $1.7 million for the fourth quarter of 2022, an increase of $351,000 from $1.4 million for the third quarter of 2022, and an increase of $450,000 from $1.3 million for the fourth quarter of 2021. The linked-quarter increase was primarily due to an increase in other income, which included $306,000 of rate lock fees, offset partially by a decrease in letter of credit fees. The year-over-year increase was primarily due to increased customer service fees, an increase in bank-owned life insurance income and an increase in other income, offset partially by decreased letter of credit fees.

The following table presents the major components of noninterest income for the periods indicated:

	Three Months Ended						Year Ended
	December 31,		September 30,		December 31,		December 31,		December 31,
(dollars in thousands)	2022		2022		2021		2022		2021
Noninterest Income:
Customer Service Fees	$	344	$	313	$	274	$	1,236	$	1,007
Net Gain on Sales of Securities		30		—		—		82		750
Letter of Credit Fees		358		428		541		1,592		1,676
Debit Card Interchange Fees		148		153		149		586		563
Swap Fees		—		—		—		557		—
Bank-Owned Life Insurance		238		227		150		762		316
Other Income		620		266		174		1,517		997
Totals	$	1,738	$	1,387	$	1,288	$	6,332	$	5,309

Noninterest Expense

Noninterest expense was $15.2 million for the fourth quarter of 2022, an increase of $1.0 million from $14.2 million for the third quarter of 2022, and an increase of $2.7 million from $12.5 million for the fourth quarter of 2021. The linked-quarter increase was primarily due to increases in salaries and employee benefits, derivative collateral fees, and other expense. The year-over-year increase was primarily attributable to increases in salaries and employee benefits, occupancy and equipment, and derivative collateral fees.

Page 7 of 17

The following table presents the major components of noninterest expense for the periods indicated:

	Three Months Ended						Year Ended
	December 31,		September 30,		December 31,		December 31,		December 31,
(dollars in thousands)	2022		2022		2021		2022		2021
Noninterest Expense:
Salaries and Employee Benefits	$	9,821	$	9,449	$	7,966	$	36,941	$	30,889
Occupancy and Equipment		1,177		1,086		939		4,390		3,916
FDIC Insurance Assessment		360		315		345		1,365		1,305
Data Processing		371		372		306		1,396		1,222
Professional and Consulting Fees		635		594		718		2,664		2,520
Derivative Collateral Fees		535		122		1		687		3
Information Technology and Telecommunications		673		650		554		2,495		2,163
Marketing and Advertising		403		479		469		2,032		1,487
Intangible Asset Amortization		48		48		48		191		191
Amortization of Tax Credit Investments		114		114		152		408		562
Debt Prepayment Fees		—		—		—		—		582
Other Expense		1,066		928		961		4,051		3,255
Totals	$	15,203	$	14,157	$	12,459	$	56,620	$	48,095

The Company continues to invest in its people across the organization, with 246 full-time equivalent employees at December 31, 2022, and September 30, 2022, and 220 employees at December 31, 2021.

The efficiency ratio, a non-GAAP financial measure, was 43.8% for the fourth quarter of 2022, compared to 39.8% for the third quarter of 2022, and 40.8% for the fourth quarter of 2021. Excluding the impact of certain non-routine income and expenses, the adjusted efficiency ratio, a non-GAAP financial measure, was 43.5% for the fourth quarter of 2022, 39.4% for the third quarter of 2022, and 40.3% for the fourth quarter of 2021.

Income Taxes

The effective combined federal and state income tax rate for the fourth quarter of 2022 was 23.4%, a decrease from 26.8% for the third quarter of 2022 and 25.7% for the fourth quarter of 2021.

Balance Sheet

Total assets at December 31, 2022 were $4.35 billion, a 5.2% increase from $4.13 billion at September 30, 2022, and a 25.0% increase from $3.48 billion at December 31, 2021. The linked-quarter increase in total assets was primarily due to strong organic loan growth and continued purchases of investment securities. The year-over-year increase in total assets was primarily due to strong organic loan growth, purchases of investment securities and an increase of other assets, offset partially by a decrease in cash and cash equivalents.

Total gross loans at December 31, 2022 were $3.57 billion, an increase of $189.4 million, or 5.6%, over total gross loans of $3.38 billion at September 30, 2022, and an increase of $750.0 million, or 26.6%, over total gross loans of $2.82 billion at December 31, 2021. The increase in the loan portfolio during the fourth quarter of 2022 was primarily due to growth in the construction and land development, multifamily, and CRE nonowner occupied segments.

Page 8 of 17

The following table presents the dollar composition of the Company’s loan portfolio, by category, at the dates indicated:

	December 31, 2022		September 30, 2022		June 30, 2022		March 31, 2022		December 31, 2021
(dollars in thousands)
Commercial	$	435,344	$	412,448	$	403,569	$	363,290	$	360,169
Paycheck Protection Program		1,049		1,192		4,860		12,309		26,162
Construction and Land Development		365,796		335,557		359,191		321,131		281,474
Real Estate Mortgage:
1 - 4 Family Mortgage		355,474		341,102		334,815		312,201		305,317
Multifamily		1,306,738		1,230,509		1,087,865		1,012,623		910,243
CRE Owner Occupied		149,905		151,088		142,214		117,969		111,096
CRE Nonowner Occupied		947,008		900,691		886,432		840,463		818,569
Total Real Estate Mortgage Loans		2,759,125		2,623,390		2,451,326		2,283,256		2,145,225
Consumer and Other		8,132		7,495		6,939		7,981		6,442
Total Loans, Gross		3,569,446		3,380,082		3,225,885		2,987,967		2,819,472
Allowance for Loan Losses		(47,996)		(46,491)		(44,711)		(41,692)		(40,020)
Net Deferred Loan Fees		(9,293)		(9,088)		(9,536)		(9,065)		(9,535)
Total Loans, Net	$	3,512,157	$	3,324,503	$	3,171,638	$	2,937,210	$	2,769,917

Total deposits at December 31, 2022 were $3.42 billion, an increase of $111.5 million, or 3.4%, over total deposits of $3.31 billion at September 30, 2022, and an increase of $470.3 million, or 16.0%, over total deposits of $2.95 billion at December 31, 2021. Deposit growth in the fourth quarter of 2022 was primarily due to an increase in brokered deposits, offset partially by a decline in all other deposit portfolios. Brokered deposits were being used as a supplemental funding source, as needed, to support the loan portfolio growth.

The following table presents the dollar composition of the Company’s deposit portfolio, by category, at the dates indicated:

	December 31, 2022		September 30, 2022		June 30, 2022		March 31, 2022		December 31, 2021
(dollars in thousands)
Noninterest Bearing Transaction Deposits	$	884,272	$	961,084	$	961,998	$	835,482	$	875,084
Interest Bearing Transaction Deposits		451,992		510,396		522,151		598,402		544,789
Savings and Money Market Deposits		1,031,873		1,077,333		952,138		890,926		863,567
Time Deposits		272,253		293,052		272,424		286,674		293,474
Brokered Deposits		776,153		463,209		493,242		424,127		369,323
Total Deposits	$	3,416,543	$	3,305,074	$	3,201,953	$	3,035,611	$	2,946,237

Capital

Total shareholders’ equity at December 31, 2022 was $394.1 million, an increase of $12.1 million compared to total shareholders’ equity of $382.0 million at September 30, 2022, and an increase of $14.8 million, or 3.9%, over total shareholders’ equity of $379.3 million at December 31, 2021. The linked-quarter increase was due to net income retained, offset partially by unrealized losses in the securities portfolio. The year-over-year increase was due to net income retained and unrealized gains in the derivatives portfolio, offset partially by stock repurchases made under the Company’s stock repurchase program and an increase in unrealized losses in the securities portfolio. The Company did not purchase any shares of its common stock during the fourth quarter of 2022.

Tangible book value per share, a non-GAAP financial measure, was $11.69 as of December 31, 2022, an increase of 3.2% from $11.33 as of September 30, 2022, and an increase of 6.5% from $10.98 as of December 31, 2021. The linked-quarter and year-over-year increase occurred despite the market value depreciation of the securities portfolio driven by the rapidly rising interest rate environment, which continues to negatively impact accumulated other comprehensive income. Tangible common equity as a percentage of tangible assets, a non-GAAP financial measure, was 7.48% at December 31, 2022, compared to 7.57% at September 30, 2022, and 8.91% at December 31, 2021.

Today, the Company also announced that its Board of Directors declared a quarterly cash dividend on its 5.875% Non-Cumulative Perpetual Preferred Stock, Series A (Series A Preferred Stock). The quarterly cash dividend of $36.72 per share, equivalent to $0.3672 per depositary share, each representing a 1/100th interest in a share of the Series A Preferred Stock (Nasdaq: BWBBP), is payable on March 1, 2023 to shareholders of record of the Series A Preferred Stock at the close of business on February 15, 2023.

Page 9 of 17

Asset Quality

Annualized net charge-offs (recoveries) as a percent of average loans were 0.00% for the fourth quarter of 2022, compared to (0.03)% for the third quarter of 2022 and 0.00% for each of the previous three quarters. At December 31, 2022, the Company’s nonperforming assets, which include nonaccrual loans, loans past due 90 days and still accruing, and foreclosed assets, were $639,000, or 0.01% of total assets, as compared to $663,000, or 0.02% of total assets at September 30, 2022, and $722,000, or 0.02% of total assets at December 31, 2021.

Loans that have potential weaknesses that warrant a watchlist risk rating at December 31, 2022 totaled $32.3 million, compared to $22.8 million at September 30, 2022, and $49.3 million at December 31, 2021. The linked-quarter increase was primarily due to the migration of two loan relationships. The increased uncertainty in the economic environment may result in further watchlist or adverse classifications in the loan portfolio. Loans that warranted a substandard risk rating at December 31, 2022 totaled $28.0 million, compared to $30.8 million at September 30, 2022, and $22.6 million at December 31, 2021.

The following table presents a summary of asset quality measurements at the dates indicated:

	As of and for the Three Months Ended
	December 31,			September 30,			June 30,			March 31,			December 31,
(dollars in thousands)	2022			2022			2022			2022			2021
Selected Asset Quality Data
Loans 30-89 Days Past Due	$	186		$	38		$	225		$	13		$	49
Loans 30-89 Days Past Due to Total Loans		0.01	%		0.00	%		0.01	%		0.00	%		0.00	%
Nonperforming Loans	$	639		$	663		$	688		$	706		$	722
Nonperforming Loans to Total Loans		0.02	%		0.02	%		0.02	%		0.02	%		0.03	%
Foreclosed Assets	$	—		$	—		$	—		$	—		$	—
Nonaccrual Loans to Total Loans		0.02	%		0.02	%		0.02	%		0.02	%		0.03	%
Nonaccrual Loans and Loans Past Due 90 Days and Still Accruing to Total Loans		0.02			0.02			0.02			0.02			0.03
Nonperforming Assets (1)	$	639		$	663		$	688		$	706		$	722
Nonperforming Assets to Total Assets (1)		0.01	%		0.02	%		0.02	%		0.02	%		0.02	%
Allowance for Loan Losses to Total Loans		1.34			1.38			1.39			1.40			1.42
Allowance for Loan Losses to Total Loans, Excluding PPP Loans		1.35			1.38			1.39			1.40			1.43
Allowance for Loans Losses to Nonaccrual Loans		7,511.11			7,012.22			6,498.69			5,905.38			5,542.94
Net Loan Charge-Offs (Recoveries) (Annualized) to Average Loans		0.00			(0.03)			0.00			0.00			0.00

(1) Nonperforming assets are defined as nonaccrual loans plus loans 90 days past due and still accruing plus foreclosed assets.

The Company will host a conference call to discuss its fourth quarter 2022 financial results on Thursday, January 26, 2023 at 8:00 a.m. Central Time. The conference call can be accessed by dialing 877-270-2148 and requesting to join the Bridgewater Bancshares earnings call. To listen to a replay of the conference call via phone, please dial 877-344-7529 and enter access code 1810249. The replay will be available through February 2, 2023. The conference call will also be available via a live webcast on the Investor Relations section of the Company’s website, investors.bridgewaterbankmn.com, and archived for replay.

About the Company

Bridgewater Bancshares, Inc. (Nasdaq: BWB) is a St. Louis Park, Minnesota-based financial holding company. Bridgewater's banking subsidiary, Bridgewater Bank, is a premier, full-service Twin Cities bank dedicated to serving the diverse needs of commercial real estate investors, entrepreneurs, business clients and successful individuals. By pairing a range of deposit, lending, and business services solutions with a responsive service model, Bridgewater has seen continuous growth and profitability. With total assets of $4.3 billion and seven branches as of December 31, 2022, Bridgewater is considered one of the largest locally led banks in the State of Minnesota, and has received numerous awards for its growth, banking services, and esteemed corporate culture.

Use of Non-GAAP financial measures

In addition to the results presented in accordance with U.S. Generally Accepted Accounting Principles (GAAP), the Company routinely supplements its evaluation with an analysis of certain non-GAAP financial measures. The Company believes these non-GAAP financial measures, in addition to the related GAAP measures, provide meaningful information to investors to help them understand the Company’s operating performance and trends, and to facilitate comparisons with the performance of peers. These disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies. Reconciliations of non-GAAP disclosures used in this earnings release to the

Page 10 of 17

comparable GAAP measures are provided in the accompanying tables.

Forward-Looking Statements

This earnings release contains “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements include, without limitation, statements concerning plans, estimates, calculations, forecasts and projections with respect to the anticipated future performance of the Company. These statements are often, but not always, identified by words such as “may”, “might”, “should”, “could”, “predict”, “potential”, “believe”, “expect”, “continue”, “will”, “anticipate”, “seek”, “estimate”, “intend”, “plan”, “projection”, “would”, “annualized”, “target” and “outlook”, or the negative version of those words or other comparable words of a future or forward-looking nature.

Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on our current beliefs, expectations and assumptions regarding our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Our actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not rely on any of these forward-looking statements. Important factors that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, among others, the following: interest rate risk, including the effects of recent and anticipated rate increases by the Federal Reserve; fluctuations in the values of the securities held in our securities portfolio, including as the result of rising interest rates, which has resulted in unrealized losses in our portfolio; business and economic conditions generally and in the financial services industry, nationally and within our market area, including rising rates of inflation; loan concentrations in our portfolio; the overall health of the local and national real estate market; our ability to successfully manage credit risk; our ability to maintain an adequate level of allowance for loan losses; new or revised accounting standards, including as a result of the implementation of the Current Expected Credit Loss standard; the concentration of large loans to certain borrowers; the concentration of large deposits from certain clients; our ability to successfully manage liquidity risk, which may increase our dependence on non-core funding sources such as brokered deposits, and negatively impact our cost of funds; our ability to raise additional capital to implement our business plan; our ability to implement our growth strategy and manage costs effectively; developments and uncertainty related to the future use and availability of some reference rates, such as the expected discontinuation of the London Interbank Offered Rate, as well as other alternative reference rates; the composition of our senior leadership team and our ability to attract and retain key personnel; talent and labor shortages and high rates of employee turnover; the occurrence of fraudulent activity, breaches or failures of our information security controls or cybersecurity-related incidents; interruptions involving our information technology and telecommunications systems or third-party servicers; competition in the financial services industry, including from nonbank competitors such as credit unions and “fintech” companies; the effectiveness of our risk management framework; the commencement and outcome of litigation and other legal proceedings and regulatory actions against us; the impact of recent and future legislative and regulatory changes, including changes to federal and state corporate tax rates; risks related to climate change and the negative impact it may have on our customers and their businesses; the imposition of tariffs or other governmental policies impacting the value of products produced by our commercial borrowers; severe weather, natural disasters, wide spread disease or pandemics (including the COVID-19 pandemic), acts of war or terrorism or other adverse external events including the Russian invasion of Ukraine; potential impairment to the goodwill we recorded in connection with our past acquisition; changes to U.S. or state tax laws, regulations and guidance, including the new 1% excise tax on stock buybacks by publicly traded companies; and any other risks described in the “Risk Factors” sections of reports filed by the Company with the Securities and Exchange Commission.

Any forward-looking statement made by us in this press release is based only on information currently available to us and speaks only as of the date on which it is made. We undertake no obligation to publicly update any forward-looking statement, whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise.

Page 11 of 17

Bridgewater Bancshares, Inc. and Subsidiaries
Consolidated Balance Sheets

(dollars in thousands, except share data)

	December 31,		September 30,		December 31,
	2022		2022		2021
ASSETS
Cash and Cash Equivalents	$	87,043	$	75,496	$	143,473
Bank-Owned Certificates of Deposit		1,181		1,182		1,876
Securities Available for Sale, at Fair Value		548,613		542,007		439,362
Loans, Net of Allowance for Loan Losses of $47,996 at December 31, 2022 (unaudited), $46,491 at September 30, 2022 (unaudited) and $40,020 at December 31, 2021		3,512,157		3,324,503		2,769,917
Federal Home Loan Bank (FHLB) Stock, at Cost		19,606		15,603		5,242
Premises and Equipment, Net		48,445		48,941		49,395
Accrued Interest		13,479		11,198		9,186
Goodwill		2,626		2,626		2,626
Other Intangible Assets, Net		288		336		479
Other Assets		112,224		107,095		56,103
Total Assets	$	4,345,662	$	4,128,987	$	3,477,659
LIABILITIES AND EQUITY
LIABILITIES
Deposits:
Noninterest Bearing	$	884,272	$	961,084	$	875,084
Interest Bearing		2,532,271		2,343,990		2,071,153
Total Deposits		3,416,543		3,305,074		2,946,237
Federal Funds Purchased		287,000		212,000		—
Notes Payable		13,750		—		—
FHLB Advances		97,000		71,500		42,500
Subordinated Debentures, Net of Issuance Costs		78,905		92,559		92,239
Accrued Interest Payable		2,831		2,214		1,409
Other Liabilities		55,569		63,633		16,002
Total Liabilities		3,951,598		3,746,980		3,098,387
SHAREHOLDERS' EQUITY
Preferred Stock- $0.01 par value; Authorized 10,000,000
Preferred Stock - Issued and Outstanding 27,600 Series A shares ($2,500 liquidation preference) at December 31, 2022 (unaudited), September 30, 2022 (unaudited) and December 31, 2021		66,514		66,514		66,514
Common Stock- $0.01 par value; Authorized 75,000,000
Common Stock - Issued and Outstanding 27,751,950 at December 31, 2022 (unaudited), 27,587,978 at September 30, 2022 (unaudited) and 28,206,566 at December 31, 2021		278		276		282
Additional Paid-In Capital		96,529		95,973		104,123
Retained Earnings		248,685		235,964		199,347
Accumulated Other Comprehensive Income (Loss)		(17,942)		(16,720)		9,006
Total Shareholders' Equity		394,064		382,007		379,272
Total Liabilities and Equity	$	4,345,662	$	4,128,987	$	3,477,659

Page 12 of 17

Bridgewater Bancshares, Inc. and Subsidiaries
Consolidated Statements of Income

(dollars in thousands, except per share data)

(Unaudited)

	Three Months Ended						Year Ended
	December 31,		September 30,		December 31,		December 31,		December 31,
	2022		2022		2021		2022		2021
INTEREST INCOME
Loans, Including Fees	$	42,488	$	37,666	$	31,140	$	146,256	$	118,845
Investment Securities		5,843		4,372		2,511		16,410		9,576
Other		529		321		124		1,029		458
Total Interest Income		48,860		42,359		33,775		163,695		128,879
INTEREST EXPENSE
Deposits		10,781		5,984		3,241		23,379		13,842
Notes Payable		202		—		—		202		61
FHLB Advances		575		329		162		1,221		831
Subordinated Debentures		1,030		1,242		1,219		4,688		4,630
Federal Funds Purchased		3,379		709		—		4,507		6
Total Interest Expense		15,967		8,264		4,622		33,997		19,370
NET INTEREST INCOME		32,893		34,095		29,153		129,698		109,509
Provision for Loan Losses		1,500		1,500		1,150		7,700		5,150
NET INTEREST INCOME AFTER
PROVISION FOR LOAN LOSSES		31,393		32,595		28,003		121,998		104,359
NONINTEREST INCOME
Customer Service Fees		344		313		274		1,236		1,007
Net Gain on Sales of Available for Sale Securities		30		—		—		82		750
Other Income		1,364		1,074		1,014		5,014		3,552
Total Noninterest Income		1,738		1,387		1,288		6,332		5,309
NONINTEREST EXPENSE
Salaries and Employee Benefits		9,821		9,449		7,966		36,941		30,889
Occupancy and Equipment		1,177		1,086		939		4,390		3,916
Other Expense		4,205		3,622		3,554		15,289		13,290
Total Noninterest Expense		15,203		14,157		12,459		56,620		48,095
INCOME BEFORE INCOME TAXES		17,928		19,825		16,832		71,710		61,573
Provision for Income Taxes		4,193		5,312		4,318		18,318		15,886
NET INCOME		13,735		14,513		12,514		53,392		45,687
Preferred Stock Dividends		(1,014)		(1,013)		(1,171)		(4,054)		(1,171)
NET INCOME AVAILABLE TO COMMON SHAREHOLDERS	$	12,721	$	13,500	$	11,343	$	49,338	$	44,516
EARNINGS PER SHARE
Basic	$	0.46	$	0.49	$	0.41	$	1.78	$	1.59
Diluted		0.45		0.47		0.39		1.72		1.54
Dividends Paid Per Common Share		—		—		—		—		—

Page 13 of 17

Bridgewater Bancshares, Inc. and Subsidiaries
Analysis of Average Balances, Yields and Rates

(dollars in thousands, except per share data)

(Unaudited)

	For the Year Ended
	December 31, 2022						December 31, 2021
	Average		Interest		Yield/		Average		Interest		Yield/
	Balance		& Fees		Rate		Balance		& Fees		Rate
(dollars in thousands)
Interest Earning Assets:
Cash Investments	$	66,072	$	597	0.90	%	$	132,188	$	199	0.15	%
Investment Securities:
Taxable Investment Securities		448,500		13,960	3.11			317,954		7,015	2.21
Tax-Exempt Investment Securities (1)		72,379		3,101	4.29			75,313		3,242	4.30
Total Investment Securities		520,879		17,061	3.28			393,267		10,257	2.61
Paycheck Protection Program Loans (2)		7,441		970	13.03			103,151		6,441	6.24
Loans (1)(2)		3,183,271		145,857	4.58			2,481,706		112,587	4.54
Total Loans		3,190,712		146,827	4.60			2,584,857		119,028	4.60
Federal Home Loan Bank Stock		12,628		432	3.42			5,571		259	4.65
Total Interest Earning Assets		3,790,291		164,917	4.35	%		3,115,883		129,743	4.16	%
Noninterest Earning Assets		76,189						73,917
Total Assets	$	3,866,480					$	3,189,800
Interest Bearing Liabilities:
Deposits:
Interest Bearing Transaction Deposits	$	524,968	$	4,336	0.83	%	$	441,528	$	2,052	0.46	%
Savings and Money Market Deposits		963,096		9,129	0.95			773,779		3,729	0.48
Time Deposits		284,868		3,264	1.15			323,638		4,099	1.27
Brokered Deposits		449,095		6,650	1.48			406,863		3,962	0.97
Total Interest Bearing Deposits		2,222,027		23,379	1.05			1,945,808		13,842	0.71
Federal Funds Purchased		149,608		4,507	3.01			2,479		6	0.24
Notes Payable		2,863		202	7.04			1,658		61	3.66
FHLB Advances		64,278		1,221	1.90			53,294		831	1.56
Subordinated Debentures		89,584		4,688	5.23			82,865		4,630	5.59
Total Interest Bearing Liabilities		2,528,360		33,997	1.34	%		2,086,104		19,370	0.93	%
Noninterest Bearing Liabilities:
Noninterest Bearing Transaction Deposits		910,490						764,087
Other Noninterest Bearing Liabilities		43,597						23,372
Total Noninterest Bearing Liabilities		954,087						787,459
Shareholders' Equity		384,033						316,237
Total Liabilities and Shareholders' Equity	$	3,866,480					$	3,189,800
Net Interest Income / Interest Rate Spread				130,920	3.01	%				110,373	3.23	%
Net Interest Margin (3)					3.45	%					3.54	%
Taxable Equivalent Adjustment:
Tax-Exempt Investment Securities and Loans				(1,222)						(864)
Net Interest Income			$	129,698					$	109,509

(1) Interest income and average rates for tax-exempt investment securities and loans are presented on a tax-equivalent basis, assuming a statutory federal income tax rate of 21%

(2) Average loan balances include nonaccrual loans. Interest income on loans includes amortization of deferred loan fees, net of deferred loan costs.

(3) Net interest margin includes the tax equivalent adjustment and represents the annualized results of: (i) the difference between interest income on interest earning assets and the interest expense on interest bearing liabilities, divided by (ii) average interest earning assets for the period.

Page 14 of 17

Bridgewater Bancshares, Inc. and Subsidiaries
Non-GAAP Financial Measures

(dollars in thousands) (unaudited)

	For the Three Months Ended									For the Year Ended
	December 31,			September 30,			December 31,			December 31,			December 31,
	2022			2022			2021			2022			2021
Pre-Provision Net Revenue
Noninterest Income	$	1,738		$	1,387		$	1,288		$	6,332		$	5,309
Less: Gain on Sales of Securities		(30)			—			—			(82)			(750)
Total Operating Noninterest Income		1,708			1,387			1,288			6,250			4,559
Plus: Net Interest Income		32,893			34,095			29,153			129,698			109,509
Net Operating Revenue	$	34,601		$	35,482		$	30,441		$	135,948		$	114,068
Noninterest Expense	$	15,203		$	14,157		$	12,459		$	56,620		$	48,095
Less: Amortization of Tax Credit Investments		(114)			(114)			(152)			(408)			(562)
Less: Debt Prepayment Fees		—			—			—			—			(582)
Total Operating Noninterest Expense	$	15,089		$	14,043		$	12,307		$	56,212		$	46,951
Pre-Provision Net Revenue	$	19,512		$	21,439		$	18,134		$	79,736		$	67,117
Plus:
Non-Operating Revenue Adjustments		30			—			—			82			750
Less:
Provision for Loan Losses		1,500			1,500			1,150			7,700			5,150
Non-Operating Expense Adjustments		114			114			152			408			1,144
Provision for Income Taxes		4,193			5,312			4,318			18,318			15,886
Net Income	$	13,735		$	14,513		$	12,514		$	53,392		$	45,687
Average Assets	$	4,251,345		$	3,948,201		$	3,403,270		$	3,866,480		$	3,189,800
Pre-Provision Net Revenue Return on Average Assets		1.82	%		2.15	%		2.11	%		2.06	%		2.10	%

	As of and for the Three Months Ended									As of and for the Year Ended
	December 31,			September 30,			December 31,			December 31,			December 31,
	2022			2022			2021			2022			2021
Core Net Interest Margin
Net Interest Income (Tax-Equivalent Basis)	$	33,260		$	34,417		$	29,388		$	130,920		$	110,373
Less: Loan Fees		(1,100)			(1,400)			(1,462)			(6,273)			(5,173)
Less: PPP Interest and Fees		(48)			(96)			(1,057)			(970)			(6,441)
Core Net Interest Income	$	32,112		$	32,921		$	26,869		$	123,677		$	98,759
Average Interest Earning Assets	$	4,177,644		$	3,871,896		$	3,320,603		$	3,790,291		$	3,115,883
Less: Average PPP Loans		(1,109)			(2,424)			(39,900)			(7,441)			(103,151)
Core Average Interest Earning Assets	$	4,176,535		$	3,869,472		$	3,280,703		$	3,782,850		$	3,012,732
Core Net Interest Margin		3.05	%		3.38	%		3.25	%		3.27	%		3.28	%

Page 15 of 17

Non-GAAP Financial Measures

(dollars in thousands) (unaudited)

	For the Three Months Ended									For the Year Ended
	December 31,			September 30,			December 31,			December 31,			December 31,
	2022			2022			2021			2022			2021
Efficiency Ratio
Noninterest Expense	$	15,203		$	14,157		$	12,459		$	56,620		$	48,095
Less: Amortization of Intangible Assets		(48)			(48)			(48)			(191)			(191)
Adjusted Noninterest Expense	$	15,155		$	14,109		$	12,411		$	56,429		$	47,904
Net Interest Income		32,893			34,095			29,153			129,698			109,509
Noninterest Income		1,738			1,387			1,288			6,332			5,309
Less: Gain on Sales of Securities		(30)			—			—			(82)			(750)
Adjusted Operating Revenue	$	34,601		$	35,482		$	30,441		$	135,948		$	114,068
Efficiency Ratio		43.8	%		39.8	%		40.8	%		41.5	%		42.0	%
Adjusted Efficiency Ratio
Noninterest Expense	$	15,203		$	14,157		$	12,459		$	56,620		$	48,095
Less: Amortization of Tax Credit Investments		(114)			(114)			(152)			(408)			(562)
Less: Debt Prepayment Fees		—			—			—			—			(582)
Less: Amortization of Intangible Assets		(48)			(48)			(48)			(191)			(191)
Adjusted Noninterest Expense	$	15,041		$	13,995		$	12,259		$	56,021		$	46,760
Net Interest Income		32,893			34,095			29,153			129,698			109,509
Noninterest Income		1,738			1,387			1,288			6,332			5,309
Less: Gain on Sales of Securities		(30)			—			—			(82)			(750)
Adjusted Operating Revenue	$	34,601		$	35,482		$	30,441		$	135,948		$	114,068
Adjusted Efficiency Ratio		43.5	%		39.4	%		40.3	%		41.2	%		41.0	%

	For the Three Months Ended									For the Year Ended
	December 31,			September 30,			December 31,			December 31,			December 31,
	2022			2022			2021			2022			2021
Adjusted Noninterest Expense to Average Assets (Annualized)
Noninterest Expense	$	15,203		$	14,157		$	12,459		$	56,620		$	48,095
Less: Amortization of Tax Credit Investments		(114)			(114)			(152)			(408)			(562)
Less: Debt Prepayment Fees		—			—			—			—			(582)
Adjusted Noninterest Expense	$	15,089		$	14,043		$	12,307		$	56,212		$	46,951
Average Assets	$	4,251,345		$	3,948,201		$	3,403,270		$	3,866,480		$	3,189,800
Adjusted Noninterest Expense to Average Assets (Annualized)		1.41	%		1.41	%		1.43	%		1.45	%		1.47	%

Page 16 of 17

Non-GAAP Financial Measures

(dollars in thousands) (unaudited)

	As of and for the Three Months Ended									As of and for the Year Ended
	December 31,			September 30,			December 31,			December 31,			December 31,
	2022			2022			2021			2022			2021
Tangible Common Equity and Tangible Common Equity/Tangible Assets
Total Shareholders' Equity	$	394,064		$	382,007		$	379,272
Less: Preferred Stock		(66,514)			(66,514)			(66,514)
Total Common Shareholders' Equity		327,550			315,493			312,758
Less: Intangible Assets		(2,914)			(2,962)			(3,105)
Tangible Common Equity	$	324,636		$	312,531		$	309,653
Total Assets	$	4,345,662		$	4,128,987		$	3,477,659
Less: Intangible Assets		(2,914)			(2,962)			(3,105)
Tangible Assets	$	4,342,748		$	4,126,025		$	3,474,554
Tangible Common Equity/Tangible Assets		7.48	%		7.57	%		8.91	%
Tangible Book Value Per Share
Book Value Per Common Share	$	11.80		$	11.44		$	11.09
Less: Effects of Intangible Assets		(0.11)			(0.11)			(0.11)
Tangible Book Value Per Common Share	$	11.69		$	11.33		$	10.98
Return on Average Tangible Common Equity
Net Income Available to Common Shareholders	$	12,721		$	13,500		$	11,343		$	49,338		$	44,516
Average Shareholders' Equity	$	387,589		$	384,020		$	374,035		$	384,033		$	316,237
Less: Average Preferred Stock		(66,514)			(66,514)			(66,515)			(66,514)			(24,915)
Average Common Equity		321,075			317,506			307,520			317,519			291,322
Less: Effects of Average Intangible Assets		(2,941)			(2,989)			(3,132)			(3,012)			(3,204)
Average Tangible Common Equity	$	318,134		$	314,517		$	304,388		$	314,507		$	288,118
Return on Average Tangible Common Equity		15.86	%		17.03	%		14.78	%		15.69	%		15.45	%

	Three Months Ended
	December 31,		September 30,		June 30,		March 31,		December 31,
	2022		2022		2022		2022		2021
Tangible Common Equity
Total Shareholders' Equity	$	394,064	$	382,007	$	374,883	$	379,441	$	379,272
Less: Preferred Stock		(66,514)		(66,514)		(66,514)		(66,514)		(66,514)
Common Shareholders' Equity		327,550		315,493		308,369		312,927		312,758
Less: Intangible Assets		(2,914)		(2,962)		(3,009)		(3,057)		(3,105)
Tangible Common Equity	$	324,636	$	312,531	$	305,360	$	309,870	$	309,653

Page 17 of 17