In 2021, Citizens Trust Bank celebrated its 100th year of existence. Since we opened our doors for business in 1921, we have continued to be a beacon of hope and a promise for access and equality in financial services.

Commemorating this milestone, the bank’s year-long celebration included special partnerships with local and state preservation organizations to continue to empower, inform and educate future generations about the importance of minority community banks.
Planned celebratory events included:

• Local, state, and national government office proclamations/recognitions
• Donation of 100-year-old bank documents to be shared, publicly for future exhibitions and historical preservation
• Citizens Trust Bank’s historical marker ceremony
• A tribute from Citizens Trust Bank’s customers through personal impact stories and testimonials
• A celebratory jubilee gala

In light of the pandemic, we were unable to hold in-person activities last year. However, we are planning to resume in-person celebrations for the gala jubilee and customer appreciation events as COVID restrictions continue to ease.

The last two years have presented unique challenges, from the pandemic, difficult discussions on social justice and economic equality, the war in Ukraine, and uncertainties in microeconomic conditions that are impacting our everyday lives. The world, our country, our communities, and our families have felt the impact in some way.

Though all of these circumstances are extremely important and deserve our attention, our hearts and prayers go out, specifically, to the people of Ukraine and for peace in their country.

Despite the challenges we continue to face, we never lose sight of how essential the strength and The resilience of our bank are to the resilience and the strength of our customers and the communities we serve. The well-being of our customers and community is core to our mission and values. To elevate and expand our mission, we must continue to GROW in community engagement and impact, remain agile in providing solutions that meet the growing needs of our customers, and GROW our bank to support the growth of our communities.

Our 2021 Highlights

We are proud of the performance and growth of our Company. The commitment to our mission, the engagement of our customers, the value and strength of the partnerships we have forged and the resilience of our team has been paramount to our success. In 2021, these assets produced another solid year. We are excited about the direction and future of the Company. The financial highlights are as follows:

• Raised $22 million in capital to support the Company’s growth and expansion plan
• Funded $157MM in commercial, consumer, and residential mortgage loans, while successfully managing credit risk as reflected by a delinquency ratio of 1.31% and a non-performing asset ratio of 0.27% as of December 31, 2021. A funding level that is historic for the Company.
• Experienced year-over-year growth in total assets of $97 million or 17%. The growth is attributed to an increase in deposits, representing a 14% increase over the prior year, tempered by a 1% decline in net loans outstanding, primarily due to the payoff of PPP loans during the year.
• The rapid growth in deposits over the last two years, totaling an increase of $220 million or approximately 61%, has negatively impacted ROA. However, over time the deployment of these deposits, particularly in a rising rate environment, into higher yielding assets will result in enhanced margins. The growth in deposits is a combination of both core customers and corporate relationships.
• Continued focus on efficiencies in our operations utilizing technology and streamlined workflows. Operating expenses declined $395,000 or 2.5%.
• Well-positioned for continued growth with a Tier 1 capital ratio of 24%.
• Increased dividends paid to common shareholders by 14% to $0.40 per share.

Year over year pre-tax earnings of $5.2 million from $6.8 in the prior year, including a $5 million grant, were impacted by non-recurring items and pandemic-related cost. Given consideration for these items, core earnings are still solid and growing. We believe these key performance indicators demonstrate, with each passing year, the competitive and dynamic financial institution we are.

The risk profile of our balance sheet is solid, the best it has been in the 100-year history of the institution. It provides a good foundation for us to continue to grow and benefit from the continuing trend of deeper loan penetration throughout our Georgia and Alabama footprint. Further, we will continue to expand our presence in the nearby states of Texas, Tennessee, and North Carolina, as well as the counties north of Atlanta. Citizens Trust Bank currently has a digital footprint in 48 states.

Our Community Engagement and Impact

Engagement in our communities is essential to the Company’s mission and is at the heart of our overall strategy. This includes continuing to provide, on a much greater scale, financial education and solutions that support the stabilization and strengthening of communities within the Bank’s footprint.

CTB remains proud of the ongoing financial education and training we provide. Our Financial Independence Training (FIT) program, for example, represents our commitment to educate, motivate and inspire young people to obtain a future of healthy financial well-being. To date, FIT resources have been provided to more than 14,000 middle and high school students across 16 different schools in the greater Atlanta area, representing 30% year-over-year impact growth.

Homeownership is noted as one of the key factors in addressing the wealth gap for Black Americans. Citizens Trust Bank hosted a series of educational workshops and other events that reached more than 4,000 people in 2021 alone. These events provided a platform to educate attendees on the value of homeownership while also working with Federal, State and local organizations to provide downpayment assistance to prospective first-time home-buyers. For clients with no previous knowledge of how to navigate or realize the American dream of homeownership, Citizens Trust Bank partnered with several counseling agencies to educate and empower individuals on how to move along the path to homeownership.

As the lifeblood of our communities, small businesses are vital to creating jobs, and building wealth. We remain committed to maintaining a sustainable and strong community ecosystem by providing access to capital for acquisitions and expansion.

From funding operation expenses to real estate construction loans, the CTB-hosted Access to Capital workshops combined with delivering convenient, efficient digital management tools continue to help realize dreams of entrepreneurship and improve chances for securing healthy, thriving community businesses.

We are proud of the results. The Company supported:

• Residential mortgages facilitating homeownership in 24 states.
• Over $30MM in residential mortgage loans resulting in a sizable increase in new homeowners.
• Home mortgages of which 90% were to minority borrowers, mostly African Americans.
• And, an additional $200MM has been earmarked for residential mortgage loans in minority communities by 2024.

Citizens Trust Bank remains committed to economic equality and building wealth for generations. Whether it is providing the resources to help customers become homeowners or helping them grow their businesses, the Bank must continue to be innovative in delivering its solutions to meet the rapidly changing expectations for financial services. The COVID-19 Pandemic highlighted the need to be agile and respond quickly. As our team helped our customers apply for the Paycheck Protection Program (PPP) loans and/or provided debt restructures, we recognized that it was imperative to adjust the lending platform to increase the capacity to serve more businesses. Citizens Trust Bank launched a digital lending platform that allowed the Bank to process nearly three times the applications that were processed in Phase I of the PPP. Further, the enhancement allows for the accommodation and anticipated growth in lending to small businesses and consumers in our core business.

Our Value Proposition

Providing small businesses with opportunities to operate, scale, and diversify their businesses continues to be a catalyst for building and sustaining healthy communities, creating more jobs, and generating wealth for the people and communities we serve. During the 2020-21 pandemic, more than $200MM+ in loans were extended to small businesses.

In addition, through 2024, Citizens Trust Bank has committed to expanding our support of small and minority businesses by allocating over $358MM in lendable funds for their growth and operating capital. If executed as planned, it will result in:

• Approximately 75% of the Bank’s lending efforts will support small and minority businesses.
• And an estimated 19,000 in job creation.

We will never stop advocating for the growth and well-being of our customers. We are forging alliances with partners whose values align with ours and who are committed to the pursuit of economic equality for minority communities.

Strategic Partnerships

This year, we were fortunate to partner and collaborate with several Fortune 100 companies and major organizations. These partnerships resulted in invested capital into our Company, shared expertise and resources, depository relationships, and participation in major credit facilities. These partnerships provide us the opportunities to scale and expand our core business in our current market and into new markets, invest in innovative technology, and ultimately deepen our impact with a broader number of consumers and businesses to reverse the negative trend of an expanding wealth gap in Black and Brown communities.

We are encouraged by these partnerships and ongoing collaborations with companies committed to our vision of inclusion of minority businesses in their supply chain. In partnership with these companies, Citizens Trust Bank has provided the necessary capital for minority businesses to fulfill their commitments and execute under large corporate contracts. These win-win relationships deliver results, for example:

• We provided capital to a minority-owned business to support a multi-year master service agreement with a Fortune 100 Company that supports their growth in becoming the largest African American forestry contractor in the country.
• The partnership created 40 new jobs with base compensation packages up to $75,000.

We will continue to promote and facilitate these relationships to enable minority businesses to grow, create jobs and support stronger, healthier communities.

Digital Accessibility

To facilitate our growth and expansion into broader markets, we must be nimble and agile. We will continuously pursue innovation and evaluate technology to meet the expectations of our customers and to deliver financial services for the future. From deploying artificial intelligence to leveraging customer data to improving the customer experience from all Citizens Trust Bank’s digital platforms, we remain committed to providing digital access to accommodate the ever-changing needs of our customers. More than 90% of Black Americans own smartphones and, following this trend, more than 70% of our customer engagement occurs through our digital platforms. To that end, the enhancements we made to Citizens Trust Bank Online and the CTBMobile app provide convenient financial solutions and tools for our consumer and business relationships, including:

• Convenient access and account management tool
• Transfer and payments of fund
• ZELLE®, a fast, safe, and easy way to send money in minutes to friends, family, and others you trust, right from the Citizens Trust Bank mobile app
• Account alerts, security, and fraud prevention resource

Continuing On

As we move forward, we are well-positioned to grow and expand. We are committed to providing high-quality financial services and building lasting client relationships. We are keeping pace with fast-changing technology and the technological needs of our customers. We continue to recruit and retain quality talent to enable our progress.

We remain committed to honoring our founders’ vision—to provide access to financial services and promote economic equality, particularly in communities of color. We will continue to pursue innovation and cultivate partnerships that will strengthen and transform the Company and its communities for generations to come.

We are proud of our team’s commitment to our mission, vision, and core values. Even in a year filled with unprecedented and ongoing challenges, their efforts produced outstanding results and positioned us for a strong future.

As always, we want to thank our shareholders for your continued support of the Company.

After 100 years, we are Stronger Together.