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EXHIBIT 99.2 Earnings Release Supplement Fourth Quarter 2021
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Citizens Community Bancorp, Inc. Table of Contents Cautionary Notes and Additional Disclosures COVID‐19 Related Loan Deferrals Non‐Owner Occupied CRE Owner Occupied CRE Multi‐family Commercial & Industrial Loans Construction & Development Loans Agricultural Real Estate & Operating Loans Hotel Loans Restaurant Loans Campground Loans Credit Quality/Risk Rating Descriptions Loans by Risk Rating as of December 31, 2021 Loans by Risk Rating as of September 30, 2021 Loans by Risk Rating as of December 31, 2020 Allowance for Loan Losses Nonaccrual Loans Roll forward Other Real Estate Owned Roll forward Troubled Debt Restructurings in Accrual Status Acquired Loans – Non‐accretable difference and accretable discount tables Earnings Per Share Selected Capital Composition Highlights – Bank and Company Page(s) 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 18 18 19 20 21 1
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Cautionary Notes and Additional Disclosures DATES AND PERIODS PRESENTED In this earnings release financial supplement, unless otherwise noted, “20YY” refers to either the corresponding fiscal year-end date or the corresponding 12-months (i.e. fiscal year) then ended. “MMM-YY” refers to either the corresponding quarter-end date, or the corresponding three-month period then ended. CAUTIONARY NOTE REGARDING FORWARD LOOKING STATEMENTS This earnings release financial supplement may contain certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, and Section 21E of the Securities Exchange Act of 1934. These statements include, but are not limited to, descriptions of the financial condition, results of operations, asset and credit quality trends, profitability, projected earnings, future plans, strategies and expectations of Citizens Community Bancorp, Inc. (“CZWI” or the “Company”) and its subsidiary, Citizens Community Federal, National Association (“CCFBank”). The Company intends such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995 and is including this statement for purposes of complying with those safe harbor provisions. Forward-looking statements, which are based on certain assumptions of the Company, are generally identifiable by use of the words “believe,” “expect,” “estimates,” “intend,” “anticipate,” “estimate,” “project,” “on pace,” “seek,” “target,” “potential,” “focus,” “may,” “preliminary,” “could,” “should” or similar expressions. These forward-looking statements express management’s current expectations or forecasts of future events, and by their nature, are subject to risks and uncertainties. Therefore, there are a number of factors that might cause actual results to differ materially from those in such statements. These uncertainties include conditions in the financial markets and economic conditions generally; adverse impacts to the Company or CCFBank arising from the COVID-19 pandemic; the possibility of a deterioration in the residential real estate markets; interest rate risk; lending risk; the sufficiency of loan allowances; changes in the fair value or ratings downgrades of our securities; competitive pressures among depository and other financial institutions; our ability to maintain our reputation; our ability to realize the benefits of net deferred tax assets; our ability to maintain or increase our market share; acts of terrorism and political or military actions by the United States or other governments; legislative or regulatory changes or actions, or significant litigation, adversely affecting the Company or CCFBank; increases in FDIC insurance premiums or special assessments by the FDIC; disintermediation risk; our inability to obtain needed liquidity; our ability to successfully execute our acquisition growth strategy; risks posed by acquisitions and other expansion opportunities, including difficulties and delays in integrating the acquired business operations or fully realizing the cost savings and other benefits; our ability to raise capital needed to fund growth or meet regulatory requirements; the possibility that our internal controls and procedures could fail or be circumvented; our ability to attract and retain key personnel; our ability to keep pace with technological change; cybersecurity risks; changes in federal or state tax laws; changes in accounting principles, policies or guidelines and their impact on financial performance; restrictions on our ability to pay dividends; and the potential volatility of our stock price. Stockholders, potential investors and other readers are urged to consider these factors carefully in evaluating the forward-looking statements and are cautioned not to place undue reliance on such forward-looking statements. Such uncertainties and other risks that may affect the Company's performance are discussed further in Part I, Item 1A, “Risk Factors,” in the Company’s Form 10-K, for the year ended December 31, 2020 filed with the Securities and Exchange Commission (“SEC”) on March 8, 2021, and the Company's subsequent filings with the SEC. The Company undertakes no obligation to make any revisions to the forward-looking statements contained herein or to update them to reflect events or circumstances occurring after the date hereof. 30 2
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COVID-19 Related Loan Deferrals Dollars in Thousands COVID‐19 Deferrals Balance Number of Loans Commercial Deferrals Hotel Loans 5,953$ 1 Other Commercial Loans ‐ ‐ Total Commercial Deferrals 5,953 1 Residential Deferrals 671 5 Consumer Deferrals ‐ ‐ Total Deferrals 6,624$ 6 December 31, 2021 *Interest only deferral – borrower provided two years of principal and interest payments at time of deferral Commercial Loan Deferral Expiration by Quarter Balance Number of Loans Hotel Loans Quarter Ending March 31, 2022 $ 5,953* 1 Total Hotel Loans 5,953 1 Other Commercial Loans Quarter Ending March 31, 2022 ‐$ ‐ Total Other Commercial Loans ‐ ‐ Total Commercial Deferral Expirations 5,953$ 1 December 31, 2021 3
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Portfolio Fundamentals 61% 35% 4% Wisconsin Minnesota Other By Geography As of 12/31/21 • Typically well seasoned investors with multiple projects, track record of success and personal financial strength (net worth/Liquidity) • Maximum LTV =<80% with recourse to owners with >20% interest • Term of 5‐10 years with 20 to 25‐year amortizations depending on property type, markets and strength and liquidity of sponsors • Minimum DSC and/or Global DSC covenant required to monitor performance ranging from 1.15x‐1.25x • Conservative underwriting approach emphasizing actual results or market data • Appropriate use of SBA 504/7a for lower cash injection or special use projects Non – Owner Occupied CRE As of 12/31/21 As of 09/30/21 $480 $426 762 753 $629 $566 Approximate Weighted Average LTV 62% 58% 2.2x 2.2x Weighted Average Seasoning In Months 22 23 0.00% 0.00% Approximate Weighted Average DSCR Trailing 12 Month Net Charge‐Offs Loan Balance Outstanding In Millions Number of Loans Average Loan Size In Thousands Portfolio Characteristics ‐ Non‐Owner Occupied CRE 25% 22% 11% 11% 10% 8% 5% 3% 2% 3% Hotel Investor Residential CRE ‐ Senior Living CRE ‐ Retail CRE ‐ Office CRE ‐ Warehouse/Mini Storage CRE ‐ Industrial/Manufacturing CRE ‐ Campground CRE ‐ Mixed Use Other Non – Owner Occupied CRE As of 12/31/21 4
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25% 17% 11% 11% 10% 8% 6% 12% CRE Campground CRE Restaurant CRE Industrial/Manufacturing CRE Retail CRE Warehouse/Mini Storage CRE Mixed Use CRE Office Other Owner Occupied CRE As of 12/31/21 Portfolio Fundamentals 69% 12% 19% Wisconsin Minnesota Other By Geography As of 12/31/21 • Underwritten to <80% LTV based on appraised value (<75% for Restaurant) • Term of 5‐10 years with 20‐year amortization • Recourse to owners with greater than 20% interest • DSC covenant of 1.25x on project and/or Global DSC of 1.15x • Appropriate use of SBA 504/7a for lower cash injection or special use projects • By Geography “Other” segment includes borrowers with warm climates, no income tax states Owner Occupied CRE As of 12/31/21 As of 09/30/21 $219 $212 426 421 $514 $504 Approximate Weighted Average LTV 48% 47% 2.2x 2.2x Weighted Average Seasoning In Months 29 29 0.00% 0.00% Approximate Weighted Average DSCR Trailing 12 Month Net Charge‐Offs Portfolio Characteristics ‐ Owner Occupied CRE Loan Balance Outstanding In Millions Number of Loans Average Loan Size In Thousands 5
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Portfolio Fundamentals 62% 37% 1% Wisconsin Minnesota Other By Geography As of 12/31/21 100% Multi‐family Multi‐family As of 12/31/21 • Robust housing markets in Eau Claire and Mankato markets supported by student populations at state universities, technical colleges, and growing population and job markets • Multi‐family sponsors experienced owners with multi‐project portfolios • Typically underwritten to 75% LTV based on appraised value with recourse; metro markets and/or strong sponsors may warrant up to 80% LTV • Generally, term of 5‐10 years with 20 to 25‐year amortization (varies by new versus existing, size of market and sponsor strength) • Covenant for minimum DSC/Global DSC Multi-family As of 12/31/21 As of 09/30/21 $178 $156 111 111 $1.61 $1.41 68% 69% Approximate Weighted Average DSCR 1.9x 1.8x 17 18 0.00% 0.00% Approximate Weighted Average LTV Weighted Average Seasoning In Months Trailing 12 Month Net Charge‐Offs Portfolio Characteristics ‐ Multi‐family Loan Balance Outstanding In Millions Number of Loans Average Loan Size In Millions 6
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85% 14% 1% Wisconsin Minnesota Other By Geography As of 12/31/21 20% 10% 10% 9%7% 7% 6% 6% 6% 5% 4% 3% 3% 4% Manufacturing Transportation and Warehousing Finance and Insurance Real Estate, Rental and Leasing Public Admin Wholesale Trade Construction Retail Trade Education Services Agriculture Administrative Support Health Care Other Services Other Commercial & Industrial As of 12/31/21 • Highly diversified, secured loan portfolio underwritten with recourse • Lines of credit reviewed annually and may have borrowing base certificates governing line usage • Fixed asset LTV’s based on age and type of equipment; <5‐year amortization • Use of SBA Guaranty Program (Preferred Lender or General Processing) as appropriate • “Retail Trade” segment consists of Farm Supply, Franchised Hardware, Franchised Auto Parts, Franchised and Non‐franchised Auto Dealers and Repair Shops, Convenience Stores/Gas Stations Commercial & Industrial Loans As of 12/31/21 As of 09/30/21 $122 $107 714 730 $171 $147 5.3x 2.3x 31 30 ‐0.05% 0.28% Committed Line, if collateral 63 66 Approximate Weighted Average DSCR Weighted Average Seasoning In Months Trailing 12 Month Net Charge‐Offs Portfolio Characteristics ‐ Commercial & Industrial Loan Balance In Millions Number of Loans Average Loan Size In Thousands Portfolio Fundamentals 7
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Portfolio Fundamentals 28% 21% 10% 9% 6% 6% 5% 15% Commercial 1‐4 Family Construction CRE Multi‐family CRE Campground Land CRE Warehouse/Mini Storage CRE Retail CRE Senior Living Other Commercial & Development As of 12/31/21 43% 30% 11% 16% Wisconsin Minnesota Iowa Other By Geography As of 12/31/21 • Underwritten to 75‐80% LTV based on lesser of cost or appraised value with full recourse • Interest only typically up to 18 months (depending on project complexity and seasonal timing) followed by amortization of 15‐25 years (terms vary by property type) • Borrower equity contribution of cash/land value =>15% injected at the beginning of project (cash/land contribution) • Construction loans require 3rd party inspections and title company draws after balancing to sworn construction statement • 1‐4 residential construction centered in eastern Twin Cities and Northwest Wisconsin. Generally, 80% LTC /60%‐80% of AV. Spec building capped. Progress reporting monthly by individual home Construction & Development Loans As of 12/31/21 As of 09/30/21 Loan Balance Outstanding In Millions $80 $86 Number of Loans 130 132 Average Loan Size In Thousands $612 $648 Approximate Weighted Average LTV 80% 78% Trailing 12 Month Net Charge‐Offs 0.00% 0.00% Percent Utilized of Commitments 44% 50% Portfolio Characteristics ‐ Construction & Development 8
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40% 22% 22% 16% Crop Dairy Other Farming Other Agricultural As of 12/31/21 Portfolio Fundamentals 68% 29% 3% Wisconsin Minnesota Other By Geography As of 12/31/21 • Producers required to have marketing plans to mitigate volatility of commodities • Appropriate crop/revenue insurance and/or dairy margin protection required • Maximum ag RE LTV of less than 65%; equipment LTV of less than 75% • Appropriate structuring to separate crop production cycles and to match length of loan with asset financed • Use of Farmer Mac, FSA, SBA or USDA programs to address DSC, collateral margins or working capital Agricultural Real Estate & Operating Loans As of 12/31/21 As of 09/30/21 $110 $107 564 568 $195 $188 1.8x 1.8x 31 31 0.16% 0.18% Approximate Weighted Average DSCR Weighted Average Seasoning In Months Trailing 12 Month Net Charge‐Offs Portfolio Characteristics ‐ Agricultural Loan Balance Outstanding In Millions Number of Loans Average Loan Size In Thousands 9
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64% 33% 3% Limited Service Full Service Other Hotels As of 12/31/21 Portfolio Fundamentals 52% 36% 12% Minnesota Wisconsin Illinois By Geography As of 12/31/21 • Mainly experienced multi project hoteliers and guarantors with strong personal financial statements (net worth and liquidity) • Mainly flagged properties • Underwriting consistent with management's conservative approach to Investor CRE, emphasizing actual results in underwriting Hotel Loans As of 12/31/21 As of 09/30/21 $119 $109 33 31 $3.6 $3.5 57% 56% 2.3x 2.3x 0.00% 0.00%Trailing 12 Month Net Charge Offs Number of Loans Approximate DSCR ‐ Non‐Construction Portfolio Characteristics ‐ Hotels Loan Balance Outstanding In Millions Average Loan Size In Millions Approximate Weighted Average LTV 10
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56% 12% 12% 8% 4% 3% 4% Culver's ‐ Limited Service Restaurants Micro Breweries Other National Limited Services Drinking Establishments Bowling Centers Other Restaurants As of 12/31/21 Portfolio Fundamentals 75% 20% 5% Wisconsin Minnesota Other By Geography As of 12/31/21 • Experienced developers/operators of national Limited /Quick Service brands (Culver’s, Subway, Dairy Queen, McDonalds, Jimmy John’s, A&W) • Underwritten to =<80% LTV with full recourse (depending on sponsor history); 20‐year amortization with 5 to 10‐year terms • Use of SBA Guaranty Program (Preferred Lender or General Processing) as appropriate • Drinking establishments may have other collateral pledged and tend to be in smaller communities in our footprint • Micro Breweries concentrated in Eau Claire area • Lessors of RE include investor and owner‐occupied structure Restaurant Loans As of 12/31/21 As of 09/30/21 $47 $41 76 80 $622 $518 54% 56% 3.6x 3.5x 0.00% 0.00% Portfolio Characteristics ‐ Restaurants Approximate Weighted Average DSCR Trailing 12 Month Net Charge‐Offs Loan Balance Outstanding In Millions Number of Loans Average Loan Size In Thousands Approximate Weighted Average LTV 11
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33% 36% 13% 5% 4% 9% 2021 2020 2019 2017 2016 Prior By Vintage As of 12/31/21 Portfolio Fundamentals 32% 13% 11%9% 7% 6% 5% 5% 12% Wisconsin Maryland Ohio Pennsylvania Kentucky Utah Iowa New Jersey Other By Geography As of 12/31/21 • Experienced multi‐unit operators and owner‐occupied franchised campgrounds (typically Jellystone Park) • Grounds offer a mix of camping, RV and cabin options with recreational amenities • Park locations within reasonable proximity of metropolitan areas and/or near national and state parks • Underwritten with recourse generally with 5‐10 year terms and 20 year amortization • Use of SBA 7a and 504, or other government guaranteed loan programs as appropriate • 20+ years of history through CCF acquisition with no charge‐off history Campground Loans As of 12/31/21 As of 09/30/21 $74 $83 48 49 $1.5 $1.7 44% 43% 1.8x 1.8x 0.00% 0.00% Portfolio Characteristics ‐ Campgrounds Approximate Weighted Average DSCR Trailing 12 Month Net Charge‐Offs Loan Balance Outstanding In Millions Number of Loans Average Loan Size In Millions Approximate Weighted Average LTV 12
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Credit Quality/Risk Ratings: Management utilizes a numeric risk rating system to identify and quantify the Bank’s risk of loss within its loan portfolio. Ratings are initially assigned prior to funding the loan, and may be changed at any time as circumstances warrant. Ratings range from the highest to lowest quality based on factors that include measurements of ability to pay, collateral type and value, borrower stability and management experience. The Bank’s loan portfolio is presented below in accordance with the risk rating framework that has been commonly adopted by the federal banking agencies. The definitions of the various risk rating categories are as follows: 1 through 4 - Pass. A “Pass” loan means that the condition of the borrower and the performance of the loan is satisfactory or better. 5 - Watch. A “Watch” loan has clearly identifiable developing weaknesses that deserve additional attention from management. Weaknesses that are not corrected or mitigated, may jeopardize the ability of the borrower to repay the loan in the future. 6 - Special Mention. A “Special Mention” loan has one or more potential weakness that deserve management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or in the institution’s credit position in the future. 7 - Substandard. A “Substandard” loan is inadequately protected by the current net worth and paying capacity of the obligor or the collateral pledged, if any. Assets classified as substandard must have a well-defined weakness, or weaknesses, that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the Bank will sustain some loss if the deficiencies are not corrected. 8 - Doubtful. A “Doubtful” loan has all the weaknesses inherent in a Substandard loan with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions and values, highly questionable and improbable. 9 - Loss. Loans classified as “Loss” are considered uncollectible, and their continuance as bankable assets is not warranted. This classification does not mean that the loan has absolutely no recovery or salvage value, and a partial recovery may occur in the future. 13
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Below is a breakdown of loans by risk rating as of December 31, 2021: 1 to 5 6 7 8 9 TOTAL Originated Loans: Commercial/Agricultural real estate: Commercial real estate $ 572,724 $ 667 $ 5,004 $ — $ — $ 578,395 Agricultural real estate 50,834 1,267 271 — — 52,372 Multi-family real estate 173,760 290 — — — 174,050 Construction and land development 75,146 — 3,467 — — 78,613 C&I/Agricultural operating: Commercial and industrial 107,798 57 82 — — 107,937 Agricultural operating 23,935 764 1,503 — — 26,202 Residential mortgage: Residential mortgage 60,754 — 3,101 — — 63,855 Purchased HELOC loans 3,706 — 165 — — 3,871 Consumer installment: Originated indirect paper 15,818 — 153 — — 15,971 Other consumer 8,404 — 69 — — 8,473 Originated loans before SBA PPP loans $ 1,092,879 $ 3,045 $ 13,815 $ — $ — $ 1,109,739 SBA PPP loans 8,755 — — — — 8,755 Total originated loans $ 1,101,634 $ 3,045 $ 13,815 $ — $ — $ 1,118,494 Acquired Loans: Commercial/Agricultural real estate: Commercial real estate $ 116,839 $ 1,314 $ 1,917 $ — $ — $ 120,070 Agricultural real estate 21,051 — 5,072 — — 26,123 Multi-family real estate 4,299 — — — — 4,299 Construction and land development 735 172 — — — 907 C&I/Agricultural operating: Commercial and industrial 13,931 5 294 — — 14,230 Agricultural operating 4,936 — 450 — — 5,386 Residential mortgage: Residential mortgage 25,869 — 1,266 — — 27,135 Consumer installment: Other consumer 398 — 3 — — 401 Total acquired loans $ 188,058 $ 1,491 $ 9,002 $ — $ — $ 198,551 Total Loans: Commercial/Agricultural real estate: Commercial real estate $ 689,563 $ 1,981 $ 6,921 $ — $ — $ 698,465 Agricultural real estate 71,885 1,267 5,343 — — 78,495 Multi-family real estate 178,059 290 — — — 178,349 Construction and land development 75,881 172 3,467 — — 79,520 C&I/Agricultural operating: Commercial and industrial 121,729 62 376 — — 122,167 Agricultural operating 28,871 764 1,953 — — 31,588 Residential mortgage: Residential mortgage 86,623 — 4,367 — — 90,990 Purchased HELOC loans 3,706 — 165 — — 3,871 Consumer installment: Originated indirect paper 15,818 — 153 — — 15,971 Other consumer 8,802 — 72 — — 8,874 Gross Loans Before SBA PPP Loans $ 1,280,937 $ 4,536 $ 22,817 $ — $ — $ 1,308,290 SBA PPP loans 8,755 — — — — 8,755 Gross loans $ 1,289,692 $ 4,536 $ 22,817 $ — $ — $ 1,317,045 Less: Unearned net deferred fees and costs and loans in process (2,482) Unamortized discount on acquired loans (3,600) Allowance for loan losses (16,913) Loans receivable, net $ 1,294,050 14
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Below is a breakdown of loans by risk rating as of September 30, 2021: 1 to 5 6 7 8 9 TOTAL Originated Loans: Commercial/Agricultural real estate: Commercial real estate $ 507,305 $ 300 $ 935 $ — $ — $ 508,540 Agricultural real estate 48,053 378 651 — — 49,082 Multi-family real estate 149,802 292 — — — 150,094 Construction and land development 76,366 — 8,033 — — 84,399 C&I/Agricultural operating: Commercial and industrial 87,481 16 3,084 — — 90,581 Agricultural operating 23,744 22 1,624 — — 25,390 Residential mortgage: Residential mortgage 65,733 — 3,253 — — 68,986 Purchased HELOC loans 3,756 — 165 — — 3,921 Consumer installment: Originated indirect paper 17,511 — 178 — — 17,689 Other consumer 9,344 — 70 — — 9,414 Originated loans before SBA PPP loans $ 989,095 $ 1,008 $ 17,993 $ — $ — $ 1,008,096 SBA PPP loans 31,301 — — — — 31,301 Total originated loans $ 1,020,396 $ 1,008 $ 17,993 $ — $ — $ 1,039,397 Acquired Loans: Commercial/Agricultural real estate: Commercial real estate $ 126,472 $ 1,342 $ 1,970 $ — $ — $ 129,784 Agricultural real estate 22,517 — 5,035 — — 27,552 Multi-family real estate 5,928 — — — — 5,928 Construction and land development 949 190 — — — 1,139 C&I/Agricultural operating: Commercial and industrial 16,243 8 303 — — 16,554 Agricultural operating 4,251 — 290 — — 4,541 Residential mortgage: Residential mortgage 29,253 — 1,542 — — 30,795 Consumer installment: Other consumer 512 — 4 — — 516 Total acquired loans $ 206,125 $ 1,540 $ 9,144 $ — $ — $ 216,809 Total Loans: Commercial/Agricultural real estate: Commercial real estate $ 633,777 $ 1,642 $ 2,905 $ — $ — $ 638,324 Agricultural real estate 70,570 378 5,686 — — 76,634 Multi-family real estate 155,730 292 — — — 156,022 Construction and land development 77,315 190 8,033 — — 85,538 C&I/Agricultural operating: Commercial and industrial 103,724 24 3,387 — — 107,135 Agricultural operating 27,995 22 1,914 — — 29,931 Residential mortgage: Residential mortgage 94,986 — 4,795 — — 99,781 Purchased HELOC loans 3,756 — 165 — — 3,921 Consumer installment: Originated indirect paper 17,511 — 178 — — 17,689 Other consumer 9,856 — 74 — — 9,930 Gross Loans Before SBA PPP Loans $ 1,195,220 $ 2,548 $ 27,137 $ — $ — $ 1,224,905 SBA PPP loans 31,301 — — — — 31,301 Gross loans $ 1,226,521 $ 2,548 $ 27,137 $ — $ — $ 1,256,206 Less: Unearned net deferred fees and costs and loans in process (3,486) Unamortized discount on acquired loans (4,066) Allowance for loan losses (16,832) Loans receivable, net $ 1,231,822 15
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Below is a breakdown of loans by risk rating as of December 31, 2020: 1 to 5 6 7 8 9 TOTAL Originated Loans: Commercial/Agricultural real estate: Commercial real estate $ 349,482 $ 543 $ 1,088 $ — $ — $ 351,113 Agricultural real estate 30,041 446 1,254 — — 31,741 Multi-family real estate 112,423 308 — — — 112,731 Construction and land development 87,763 — 3,478 — — 91,241 C&I/Agricultural operating: Commercial and industrial 91,474 20 3,796 — — 95,290 Agricultural operating 22,462 934 1,061 — — 24,457 Residential mortgage: Residential mortgage 82,097 7 4,179 — — 86,283 Purchased HELOC loans 5,959 — 301 — — 6,260 Consumer installment: Originated indirect paper 25,616 — 235 — — 25,851 Other consumer 11,986 — 70 — — 12,056 Originated loans before SBA PPP loans $ 819,303 $ 2,258 $ 15,462 $ — $ — $ 837,023 SBA PPP loans 123,702 — — — — 123,702 Total originated loans $ 943,005 $ 2,258 $ 15,462 $ — $ — $ 960,725 Acquired Loans: Commercial/Agricultural real estate: Commercial real estate $ 148,303 $ 4,274 $ 3,985 $ — $ — $ 156,562 Agricultural real estate 31,147 — 5,907 — — 37,054 Multi-family real estate 9,273 — 148 — — 9,421 Construction and land development 7,237 — 39 — — 7,276 C&I/Agricultural operating: Commercial and industrial 20,918 9 336 — — 21,263 Agricultural operating 7,838 — 490 — — 8,328 Residential mortgage: Residential mortgage 42,805 131 2,167 — — 45,103 Consumer installment: Other consumer 1,150 — 7 — — 1,157 Total acquired loans $ 268,671 $ 4,414 $ 13,079 $ — $ — $ 286,164 Total Loans: Commercial/Agricultural real estate: Commercial real estate $ 497,785 $ 4,817 $ 5,073 $ — $ — $ 507,675 Agricultural real estate 61,188 446 7,161 — — 68,795 Multi-family real estate 121,696 308 148 — — 122,152 Construction and land development 95,000 — 3,517 — — 98,517 C&I/Agricultural operating: Commercial and industrial 112,392 29 4,132 — — 116,553 Agricultural operating 30,300 934 1,551 — — 32,785 Residential mortgage: Residential mortgage 124,902 138 6,346 — — 131,386 Purchased HELOC loans 5,959 — 301 — — 6,260 Consumer installment: Originated indirect paper 25,616 — 235 — — 25,851 Other consumer 13,136 — 77 — — 13,213 Gross Loans Before SBA PPP Loans $ 1,087,974 $ 6,672 $ 28,541 $ — $ — $ 1,123,187 SBA PPP loans 123,702 — — — — 123,702 Gross loans $ 1,211,676 $ 6,672 $ 28,541 $ — $ — $ 1,246,889 Less: Unearned net deferred fees and costs and loans in process (4,245) Unamortized discount on acquired loans (5,063) Allowance for loan losses (17,043) Loans receivable, net $ 1,220,538 16
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Allowance for Loan Losses (in thousand, except ratios) December 31, 2021 and Three Months Ended September 30, 2021 and Three Months Ended June 30, 2021 and Three Months Ended December 31, 2020 and Three Months Ended Allowance for loan losses (“ALL”), at beginning of period $ 16,832 $ 16,845 $ 16,860 $ 14,836 Loans charged off: Commercial/Agricultural real estate — — (51) — C&I/Agricultural operating — — (7) (300) Residential mortgage — — — — Consumer installment (5) (36) (15) (23) Total loans charged off (5) (36) (73) (323) Recoveries of loans previously charged off: Commercial/Agricultural real estate 18 4 1 1 C&I/Agricultural operating 62 13 33 11 Residential mortgage 1 1 3 — Consumer installment 5 5 21 18 Total recoveries of loans previously charged off: 86 23 58 30 Net loans charged off (“NCOs”) 81 (13) (15) (293) Additions to ALL via provision for loan losses charged to operations — — — 2,500 ALL, at end of period $ 16,913 $ 16,832 $ 16,845 $ 17,043 Average outstanding loan balance $ 1,271,956 $ 1,192,636 $ 1,186,439 $ 1,240,895 Ratios: NCOs (annualized) to average loans (0.03) % — % 0.01 % 0.09 % 17
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Nonaccrual Loans Roll forward (in thousands) Quarter Ended December 31, 2021 September 30, 2021 June 30, 2021 March 31, 2021 December 31, 2020 Balance, beginning of period $ 11,706 $ 8,075 $ 8,678 $ 10,747 $ 13,154 Additions 428 4,859 863 430 912 Acquired nonaccrual loans — — — — — Charge offs (1) (24) (58) (205) (2) Transfers to OREO (19) — — (45) — Return to accrual status (30) — (696) (291) — Payments received (422) (1,202) (712) (1,935) (3,317) Other, net 3 (2) — (23) — Balance, end of period $ 11,665 $ 11,706 $ 8,075 $ 8,678 $ 10,747 Other Real Estate Owned Roll forward (in thousands) Quarter Ended December 31, 2021 September 30, 2021 June 30, 2021 March 31, 2021 December 31, 2020 Balance, beginning of period $ 2 $ 129 $ 57 $ 156 $ 756 Loans transferred in 46 — — 45 — Branch properties transferred in 1,360 — 79 — — Sales — (124) (5) (142) (529) Write-downs — — — — (68) Other, net (2) (3) (2) (2) (3) Balance, end of period $ 1,406 $ 2 $ 129 $ 57 $ 156 Troubled Debt Restructurings in Accrual Status (in thousands, except number of modifications) December 31, 2021 September 30, 2021 June 30, 2021 December 31, 2020 Number of Modifications Recorded Investment Number of Modifications Recorded Investment Number of Modifications Recorded Investment Number of Modifications Recorded Investment Troubled debt restructurings: Accrual Status Commercial/Agricultural real estate 11 $ 4,618 12 $ 4,711 14 $ 4,841 16 $ 4,695 C&I/Agricultural Operating 3 649 4 3,685 6 3,804 4 3,836 Residential mortgage 36 2,681 39 2,925 40 3,040 43 3,162 Consumer installment 6 36 6 44 7 51 8 49 Total loans 56 $ 7,984 61 $ 11,365 67 $ 11,736 71 $ 11,742 18
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Acquired loans represent much of the reduction in non-performing loans and classified loans. The table below shows the changes in the Bank’s non-accretable difference on purchased credit impaired loans. The second table below shows the changes in the Bank’s accretable loan discount which was established at each acquisition. The Bank has transferred the non-accretable difference on purchased credit impaired loans to accretable discount as collateral coverage improved sufficiently, due to a combination of principal paydowns and/or improving collateral positions. This transferred non-accretable difference to accretable discount is accreted over the remaining maturity of the loan or until payoff, whichever is shorter. Non-accretable difference: (in thousands) December 31, 2021 September 30, 2021 June 30, 2021 March 31, 2021 December 31, 2020 Non-accretable difference, beginning of period $ 686 $ 823 $ 966 $ 1,087 $ 1,661 Additions to non-accretable difference for acquired purchased credit impaired loans — — — — — Non-accretable difference realized as interest from payoffs of purchased credit impaired loans (2) (8) (37) (58) (324) Transfers from non-accretable difference to accretable discount (31) (129) (106) (63) (50) Non-accretable difference used to reduce loan principal balance — — — — (200) Non-accretable difference, end of period $ 653 $ 686 $ 823 $ 966 $ 1,087 The table below provides the changes in accretable discount for acquired loans. Accretable discount: (in thousands) December 31, 2021 September 30, 2021 June 30, 2021 March 31, 2021 December 31, 2020 Accretable discount, beginning of period $ 3,380 $ 3,524 $ 3,683 $ 3,976 $ 5,050 Additions to accretable discount for acquired performing loans — — — — — Accelerated accretion from payoff of certain purchased credit impaired loans with transferred non-accretable difference (200) (12) — (90) (872) Transfers from non-accretable difference to accretable discount 31 129 106 63 50 Scheduled accretion (264) (261) (265) (266) (252) Accretable discount, end of period $ 2,947 $ 3,380 $ 3,524 $ 3,683 $ 3,976 19
![slide21](https://capedge.com/proxy/8-K/0001367859-22-000017/ex992021.jpg)
On November 30, 2020, the Board of Directors adopted a share repurchase program, pursuant to which Citizens Community Bancorp, Inc. was authorized to repurchase 557 thousand shares of its common stock, or approximately 5% of the outstanding shares on that date. Repurchases made during the quarter ended September 30, 2021, used all remaining shares authorized under this share repurchase program. On July 23, 2021, the Board of Directors adopted a new share repurchase program, pursuant to which Citizens Community Bancorp, Inc. is authorized to repurchase 532,962 shares of its common stock, or approximately 5% of the outstanding shares on that date. Under this new share repurchase program, approximately 16 thousand shares, were repurchased during the quarter ended December, 2021. As of December 31, 2021, there were 10.5 million shares outstanding and an additional 373 thousand shares could be repurchased under the program. Earnings Per Share (Amounts in thousands, except per share data) Three Months Ended Twelve Months Ended December 31, 2021 September 30, 2021 December 31, 2020 December 31, 2021 December 31, 2020 Basic Net income attributable to common shareholders $ 6,057 $ 4,997 $ 3,570 $ 21,266 $ 12,725 Weighted average common shares outstanding 10,503 10,610 11,129 10,717 11,162 Basic earnings per share $ 0.58 $ 0.47 $ 0.32 $ 1.98 $ 1.14 Diluted Net income attributable to common shareholders $ 6,057 $ 4,997 $ 3,570 $ 21,266 $ 12,725 Weighted average common shares outstanding 10,503 10,610 11,129 10,717 11,162 Add: Dilutive stock options outstanding 13 13 — 10 — Average shares and dilutive potential common shares 10,516 10,623 11,129 10,727 11,162 Diluted earnings per share $ 0.58 $ 0.47 $ 0.32 $ 1.98 $ 1.14 Common stock issued and outstanding 10,502 10,519 11,056 10,502 11,056 20
![slide22](https://capedge.com/proxy/8-K/0001367859-22-000017/ex992022.jpg)
CITIZENS COMMUNITY FEDERAL N.A. Selected Capital Composition Highlights December 31, 2021 (unaudited) September 30, 2021 (unaudited) June 30, 2021 (unaudited) December 31, 2020 (audited) To Be Well Capitalized Under Prompt Corrective Action Provisions Tier 1 leverage ratio (to adjusted total assets) 10.0% 9.6% 9.7% 9.9% 5.0% Tier 1 capital (to risk weighted assets) 12.2% 12.4% 13.5% 13.5% 8.0% Common equity tier 1 capital (to risk weighted assets) 12.2% 12.4% 13.5% 13.5% 6.5% Total capital (to risk weighted assets) 13.4% 13.6% 14.7% 14.7% 10.0% CITIZENS COMMUNITY BANCORP, INC. Selected Capital Composition Highlights December 31, 2021 (unaudited) September 30, 2021 (unaudited) June 30, 2021 (unaudited) December 31, 2020 (audited) For Capital Adequacy Purposes Tier 1 leverage ratio (to adjusted total assets) 7.9% 7.6% 7.5% 7.7% 4.0% Tier 1 capital (to risk weighted assets) 9.7% 9.7% 10.4% 10.5% 6.0% Common equity tier 1 capital (to risk weighted assets) 9.7% 9.7% 10.4% 10.5% 4.5% Total capital (to risk weighted assets) 13.1% 13.2% 14.2% 14.3% 8.0% 21