Message From The President

Dear Valued Shareholders,

As we navigate today’s evolving economic environment, we remain focused on executing our strategy with discipline and foresight, even amid a backdrop of considerable uncertainty.

Navigating Uncertainty with Resilience and Focus

A convergence of macroeconomic forces—including market volatility, inflationary pressures, and the potential for rising unemployment—can impact consumer and business behavior. These conditions contribute to softening loan demand and could also influence our customers’ repayment capacity.

At the same time, the rapid increase in interest rates has placed sustained pressure on our cost of funds, which may impact our net interest margin. Although we observed initial signs of stabilization, continued rate fluctuations remain a central consideration as we refine our lending and deposit strategies.

We recognize that these market dynamics challenge traditional strategies. However, they also present opportunities to differentiate our Company through prudent risk management, operational resilience, and customer-focused innovation.

Looking ahead, we remain confident in our ability to adapt, deliver long-term value, and maintain financial strength. Our team’s experience in disciplined execution and strategic agility positions us well to navigate current headwinds and emerge stronger.

Operational Focus and Strategic Growth in a Changing Landscape

On the operational front, we are taking deliberate steps to optimize how we deliver services—enhancing the customer experience while improving internal efficiency in preparation for continued cost pressures. This includes anticipated increases in talent acquisition and retention costs, alongside essential investments in technology modernization.

Our digital platforms continue to demonstrate strong adoption and engagement, reinforcing the importance of our ongoing digital strategy. Over the last 4 years, there has been 49% growth across all digital platforms.

In parallel, we are maintaining a sharp focus on cybersecurity and data privacy—both of which remain foundational to customer trust and long-term success in an increasingly digital financial landscape.

Within the community banking sector, deposit growth has emerged as a top industry challenge. We too recognize this pressure and are actively developing innovative, sustainable strategies to strengthen and deepen our deposit base.

The broader competitive landscape is also evolving.

We are seeing intensified competition from unregulated  fintechs, increased fraud risk, and shifts in economic policy that may impact programs supporting Community Development Financial Institutions (CDFIs).

In light of these dynamics, our approach is clear: remain proactive, agile, and customer focused. We are committed to managing today’s challenges effectively while positioning the Company to capitalize on emerging opportunities and deliver long-term value.

Driving Impact Through Investing in Community

As a certified Community Development Financial Institution (CDFI), Citizens Trust Bank plays a vital role in advancing equitable access to financial services across all communities. Our participation in the Emergency Capital Investment Program (ECIP) further strengthens our commitment to serving areas that have historically lacked sufficient investment and opportunity.

Aligned with the spirit and intent of ECIP, we are deepening our focus on deep impact and qualified lending in underinvested communities—because we recognize the transformational power of access to capital.

When small businesses have the resources they need, they drive job creation and foster economic resilience. Similarly, access to affordable housing not only supports working families, but also strengthens neighborhoods, supports local economies, and builds pathways to generational wealth.

Our Company remains steadfast in our mission to create opportunities and fuel the growth of vibrant, thriving communities. In 2024, Citizens Trust Bank continued to demonstrate our commitment to economic opportunity through responsible lending and community engagement. We originated 153 loans within our target markets, with an impressive 88% in deep impact and 100% in qualified lending, directed toward Low and Moderate Income (LMI) borrowers—reinforcing our commitment to equitable access to credit.

Through the Citizens Trust Bank Down Payment Assistance Program, eligible homebuyers received up to $2,000 in support, helping to make affordable homeownership more attainable. We also continued to expand the reach of Our Money Matters, our online financial education platform, which equips individuals with the tools and knowledge needed for long-term housing success.

Our team’s community engagement efforts have also scaled significantly. In 2024, we proudly conducted hundreds of homeownership workshops in collaboration with valued partners. We have reached over 3,000 potential homeowners helping to lay the foundation for financial empowerment across the markets we serve.

These efforts are not only core to our mission—they also reflect our belief that mission driven growth and long-term shareholder value go hand in hand. Our commitment to serving our communities is not only the foundation of our purpose—it is also a powerful driver of sustainable performance. 2024 was no exception.

We are proud to report another year of strong financial performance, highlighting:

• The strength of our core business and fundamentals
• The resilience and dedication of our team
• And our ongoing commitment to generating long-term value for our shareholders

2024 Financial Highlights

• Pre-tax Return on Average Assets (Pre-tax ROAA): 2.20%
• Record year of Pre-Tax earnings of over

$16.7 million—supported by a strong efficiency ratio of 56.67%

• Gross loan growth of 10.42% year-over-year
• Deposit growth of 8.15% over the prior year
• Total asset growth of 7.28%
• Earnings per share (EPS): of $6.47, a 3% increase over last year
• Historic dividend: $1.00 per share, up from $0.75 per share
• Strong capital position: Tier 1 Capital Ratio at 40% (Total Capital Ratio at 42%)

These results were achieved despite meaningful headwinds, including:

• A 159% increase in interest expense (approximately $3.1 million) due to the continued effects of the rapid interest rate hikes

• A $3 million write-off tied to a legacy loan acquired through a broker relationship

We are incredibly proud of our ability to deliver strong results in the face of these pressures—further validating our long-term strategy and operational strength.

Looking Ahead: 2025 and Beyond

As we move forward, we remain focused on our core business considering three strategic pillars: enhance, expand, and grow.

Enhance Our Capabilities

• Invest in advanced technology to improve customer experience and operational efficiency
• Strengthen our risk management framework across operational, credit, fraud, and market risks
• Optimize product delivery to ensure faster, more tailored service

Expand Our Reach

• Deepen relationships with existing clients to grow share of wallet
• Elevate brand presence across existing and new markets
• Expand our digital footprint and deliver seamless user experiences (we currently serve customers in 47 states)

Accelerate Growth & Innovation

• Increase customer acquisition through in-person engagement, digital platforms, social media, and targeted marketing
• Improve conversion rate from over 50,000 monthly website visitors
• Deliver personalized financial solutions that deepen long-term relationships
• Emphasize community impact and sustainability as key elements of our growth model

Elevating Customer Experiences

The current environment presents unique opportunities that can be leveraged to drive growth, deepen customer engagement, and further differentiate our Company as a mission-driven, community-focused institution.

As customer preferences shift toward values-based banking, we are uniquely positioned to meet this moment. This alignment with our core mission strengthens brand loyalty, and enhances our ability to build lasting, trust-based relationships.

Our existing customer base continues to be a powerful asset, offering significant opportunities for growth through personalized cross-selling strategies.

By leveraging data-driven insights and long-standing relationships, we are tailoring solutions to meet their evolving financial needs—enhancing loyalty and lifetime value.

Further, central to our strategy is ongoing investment in technology, a key enabler of innovation, operational efficiency, and customer satisfaction. These investments allow us to meet our customers’ expectations and their needs.

Key Initiatives Driving Our Digital Transformation

Enhanced Digital Platforms: We continue to upgrade our online and mobile banking platforms to deliver seamless, intuitive, and secure user experiences— providing customers with more ways to manage their finances conveniently and confidently.

Smarter Lending Solutions: We are implementing new consumer and commercial loan platforms designed to digitize and streamline the lending process. These platforms are slated to improve time-to-decision, reduce operational costs, strengthen compliance, and significantly boost customer satisfaction. AI Integration: In partnership with a strategic corporate partner, we are actively exploring the use of artificial intelligence to enhance internal processes. AI-driven capabilities will allow us to launch innovative products more quickly, scale efficiently, and improve service.

Digital Financial Guidance: We continue to enhance our online financial literacy tools, empowering customers to make better-informed decisions while supporting long-term financial well-being.

Our focus is on leveraging technology to enhance convenience, strengthen security, and preserve personal relationships that are the foundation of our success. Our commitment to digital innovation ensures that we can deliver to our customers what they expect and need from a trusted financial partner, now and in the future.

“Your Story Is Our Story”: Strengthening Brand, Deepening Connection, Driving Growth

As part of our continued growth strategy, we are excited to announce the launch of a new marketing campaign—“Your Story Is Our Story”—designed to enhance brand awareness, expand market reach, and reinforce our position as a purpose-driven financial partner.

This campaign marks the beginning of a new era for our Company, as we unveil a refreshed brand identity that honors our legacy while embracing a forward-looking vision. At the heart of this evolution is our new brand mark, “Skyline,” symbolizing strength, trust, and progress. Accompanied by a newly redesigned corporate website, we are delivering a more modern, user-friendly, and engaging digital experience—reflecting our commitment to innovation and customer satisfaction.

A Story Rooted in Legacy, Driven by Purpose — “Your Story Is Our Story” also celebrates the powerful legacy of our founder, Heman Perry, who envisioned financial empowerment and opportunity for all. That legacy lives on today in our unwavering commitment to helping customers achieve financial independence and success.

Through this campaign, we are highlighting the deep personal and unique financial journeys— positioning ourselves not just as a financial institution, but as a trusted partner in every client’s success.

A multi-channel approach will ensure our message resonates widely and meaningfully with both existing and prospective clients. This strategic brand initiative is more than a campaign, it’s a reflection of who we are and where we are headed. It reinforces our mission, deepens community connection, and supports our long-term goals of customer engagement, market growth, and sustained shareholder value.

Our Vision for the Future

Our vision is bold, forward-thinking, and centered around customer experience and responsible growth.

With a clear roadmap and a dedicated team, we are confident in our ability to grow—not only in size, but in reach, capability, and community impact.

Your continued partnership and support are invaluable. Together, we are building a stronger, more inclusive financial future.

Sincerely,

Cynthia N. Day
President and CEO
Citizens Bancshares Corporation and Citizens Trust Bank

Ray M. Robinson
Chairman of the Board
Citizens Bancshares Corporation