EX-99.3 20 tv502468_ex99-3.htm EXHIBIT 99.3

 

Exhibit 99.3

 

 

 

CONVERSION VALUATION APPRAISAL REPORT

 

Prepared for:

 

TEB Bancorp, Inc.

Wauwatosa, Wisconsin

 

 

 

As Of:

August 17, 2018

 

Prepared By:

 

Keller & Company, Inc.

555 Metro Place North

Suite 524

Dublin, Ohio 43017

(614) 766-1426

 

KELLER & COMPANY

 

 

 

KELLER & COMPANY, INC.

FINANCIAL INSTITUTION CONSULTANTS

555 METRO PLACE NORTH

SUITE 524

DUBLIN, OHIO 43017

 

 

 

(614) 766-1426       (614) 766-1459 FAX

 

August 29, 2018

 

The Boards of Directors

The Equitable Bank, S.S.B.

TEB Bancorp, Inc.

2290 North Mayfair Road

Wauwatosa, Wisconsin 53226

 

To the Boards:

 

We hereby submit an independent appraisal (Appraisal) of the pro forma market value of the to-be-issued stock of TEB Bancorp, Inc. (the "Corporation"), which is the mid-tier holding company of The Equitable Bank, S.S.B., Wauwatosa, Wisconsin, (Equitableor the "Bank"). Such stock is to be issued in connection with the application by the Corporation to complete a minority stock offering, with TEB MHC, a federally chartered mutual holding company, to own approximately 55 percent of the shares of the Corporation, with 45 percent of the shares of the Corporation to be offered to the public. This appraisal was prepared and provided to the Corporation in accordance with the appraisal requirements of the Federal Reserve Board.

 

Keller & Company, Inc. is an independent, financial institution consulting firm that serves both thrift institutions and banks. The firm is a full-service consulting organization, as described in more detail in Exhibit A, specializing in business and strategic plans, stock valuations, conversion and reorganization appraisals, market studies and fairness opinions for thrift institutions and banks. The firm has affirmed its independence in this transaction with the preparation of its Affidavit of Independence, a copy of which is included as Exhibit C.

 

Our appraisal is based on the assumption that the data and material provided to us by the Corporation, Equitable and the independent auditors, Baker Tilly Virchow Krause, LLP, are both accurate and complete. We did not verify the financial statements provided to us, nor did we conduct independent valuations of the Banks assets and liabilities. We have also used information from other public sources, but we cannot assure the accuracy of such material.

 

In the preparation of this appraisal, we held discussions with the management of the Corporation and the Bank, with the law firm of Luse Gorman, PC, the Banks conversion counsel, and with Baker Tilly Virchow Krause, LLP. Further, we viewed the Corporations local economy and primary market area.

 

 

 

 

Boards of Directors

The Equitable Bank, S.S.B.

TEB Bancorp, Inc.

August 29, 2018

Page 2

 

This valuation must not be considered to be a recommendation as to the purchase of stock in the Corporation, and we can provide no guarantee or assurance that any person who purchases shares of the Corporation's stock will be able to later sell such shares at a price equivalent to the price designated in this appraisal.

 

Our valuation will be updated as required and will give consideration to any new developments in the Corporation's operation that have an impact on operations or financial condition. Further, we will give consideration to any changes in general market conditions and to specific changes in the market for publicly traded thrift institutions. Based on the material impact of any such changes on the pro forma market value of the Corporation as determined by this firm, we will make necessary adjustments to the Corporation's appraised value in such appraisal update.

 

It is our opinion that as of August 17, 2018, the pro forma market value or appraised value of TEB Bancorp, Inc. was $23,000,000 at the midpoint of the valuation range, with a minority public offering of $10,350,000 or 1,035,000 shares at $10 per share, representing 45.0 percent of the total value and $12,650,000 or 1,265,000 shares at $10 per share to be retained by TEB MHC.

 

Very truly yours,

 

KELLER & COMPANY, INC.

 

 

 

 

 

 

 

CONVERSION VALUATION APPRAISAL REPORT

 

Prepared for:

 

TEB Bancorp, Inc.

Wauwatosa, Wisconsin

 

 

 

As Of:

August 17, 2018

 

 

 

 

TABLE OF CONTENTS

  

    PAGE
     
INTRODUCTION 1
     
I. Description of The Equitable Bank, S.S.B.  
  General 4
  Performance Overview 8
  Income and Expense 10
  Yields and Costs 15
  Interest Rate Sensitivity 17
  Lending Activities 19
  Nonperforming Assets 23
  Investments 26
  Deposit Activities 27
  Borrowings 27
  Subsidiaries 28
  Office Properties 28
  Management 29
     
II. Description of Primary Market Area 30
     
III. Comparable Group Selection  
  Introduction 37
  General Parameter  
  Merger/Acquisition 38
  Trading Exchange 39
  IPO Date 39
  Geographic Location 40
  Asset Size 40
  Mutual Holding Companies 41
  Balance Sheet Parameters  
  Introduction 42
  Cash and Investments to Assets 43
  Mortgage-Backed Securities to Assets 43
  One- to Four-Family Loans to Assets 43
  Total Net Loans to Assets 44
  Total Net Loans and Mortgage-Backed Securities to Assets 44
  Borrowed Funds to Assets 45
  Equity to Assets 45
  Performance Parameters  
  Introduction 47

 

 

 

 

TABLE OF CONTENTS (cont.)

 

    PAGE
     
III. Comparable Group Selection (cont.)  
  Performance Parameters  
  Return on Average Assets 47
  Return on Average Equity 48
  Net Interest Margin 48
  Operating Expenses to Assets 49
  Noninterest Income to Assets 49
  Asset Quality Parameters  
  Introduction 49
  Nonperforming Assets to Total Assets 50
  Repossessed Assets to Assets 50
  Loan Loss Reserve to Assets 51
  The Comparable Group 51
     
IV. Analysis of Financial Performance 52
     
V. Market Value Adjustments  
  Earnings Performance 55
  Market Area 60
  Financial Condition 61
  Asset, Loan and Deposit Growth 64
  Dividend Payments 65
  Subscription Interest 66
  Liquidity of Stock 67
  Management 69
  Marketing of the Issue 70
     
VI. Valuation Methods  
  Introduction 71
  Valuation Methods 71
  Valuation Range 72
  Price to Book Value Method 72
  Price to Core Earnings Method 73
  Price to Assets Method 74
  Valuation Analysis and Summary 75
  Valuation Conclusion 76

 

 

 

 

LIST OF EXHIBITS

 

NUMERICAL PAGE
EXHIBITS  
     
1 Balance Sheets - At June 30, 2018 and at September 30, 2017 77
2 Balance Sheets - At September 30, 2013 through 2016 78
3 Statement of Income for the Twelve Months Ended June 30, 2018 and the Year Ended September 30, 2017 79
4 Statements of Income for the Years Ended September 30, 2013 through 2016 80
5 Selected Financial Information 81
6 Income and Expense Trends 82
7 Normalized Earnings Trend 83
8 Performance Indicators 84
9 Volume/Rate Analysis 85
10 Yield and Cost Trends 86
11 Net Portfolio Value 87
12 Loan Portfolio Composition 88
13 Loan Maturity Schedule 89
14 Delinquent Loans 90
15 Nonperforming Assets 91
16 Classified Assets 92
17 Allowance for Loan Losses 93
18 Investment Portfolio Composition 94
19 Mix of Deposits 95
20 Certificates of Deposit by Maturity 96
21 Borrowed Funds Activity 97
22 Offices of The Equitable Bank, S.S.B. 98
23 Management of the Bank 99
24 Key Demographic Data and Trends 100
25 Key Housing Data 101
26 Major Sources of Employment 102
27 Unemployment Rates 103
28 Market Share of Deposits 104
29 National Interest Rates by Quarter 105

 

 

 

 

LIST OF EXHIBITS (cont.)

 

NUMERICAL PAGE
EXHIBITS  
     
30 Thrift Share Data and Pricing Ratios 106
31 Key Financial Data and Ratios 113
32 Share Data and Pricing Ratios - Mutual Holding Companies 120
33 Key Financial Data and Ratios - Mutual Holding Companies 122
34 Recently Converted Thrift Institutions 124
35 Acquisitions and Pending Acquisitions 125
36 Balance Sheets Parameters - Comparable Group Selection 126
37 Operating Performance and Asset Quality Parameters - Comparable Group Selection 128
38 Balance Sheet Ratios - Final Comparable Group 130
39 Operating Performance and Asset Quality Ratios - Final Comparable Group 131
40 Balance Sheet Totals - Final Comparable Group 132
41 Balance Sheet - Asset Composition Most Recent Quarter 133
42 Balance Sheet - Liability and Equity Most Recent Quarter 134
43 Income and Expense Comparison - Trailing Four Quarters 135
44 Income and Expense Comparison as a Percent of Average Assets 136
45 Yields, Costs and Earnings Ratios - Trailing Four Quarters 137
46 Reserves and Supplemental Data 138
47 Comparable Group Ratios - Full Conversion 139
48 Valuation Analysis and Conclusions - Full Conversion 140
49 Pro Forma Effects of Conversion Proceeds - Minimum - Full Conversion 141
50 Pro Forma Effects of Conversion Proceeds - Midpoint - Full Conversion 142
51 Pro Forma Effects of Conversion Proceeds - Maximum - Full Conversion 143
52 Pro Forma Effects of Conversion Proceeds - Maximum, as Adjusted - Full Conversion 144
53 Summary of Valuation Premium or Discount - Full Conversion 145
54 Comparable Group Ratios - Minority Offering 146
55 Valuation Analysis and Calculation - Minority Offering 147
56 Projected Effect of Conversion Proceeds - Minimum - Minority Offering 148
57 Projected Effect of Conversion Proceeds - Midpoint - Minority Offering 149
58 Projected Effect of Conversion Proceeds - Maximum - Minority Offering 150
59 Projected Effect of Conversion Proceeds - Maximum, as adjusted - Minority Offering 151
60 Summary of Valuation of Valuation Premium or Discount - Minority Offering 152

  

 

 

  

ALPHABETICAL EXHIBITS PAGE
     
A Background and Qualifications 153
B RB 20 Certification 157
C Affidavit of Independence 158

 

 

 

 

INTRODUCTION

 

Keller & Company, Inc. is an independent appraisal firm for financial institutions and has prepared this Conversion Valuation Appraisal Report ("Report") to provide the pro forma market value of the to-be-issued common stock of TEB Bancorp, Inc. (the Corporation), which will be formed as a mid-tier holding company to own all of the common stock of The Equitable Bank, S.S.B. (Equitableor the Bank), Wauwatosa, Wisconsin. Under the Plan of Conversion, the Corporation will be majority owned by TEB MHC, a federally chartered mutual holding company, which will own 55.0 percent of the Corporation. The Corporation will sell to the public 45.0 percent of the appraised value of the Corporation as determined in this Report in a minority stock offering. The shares of common stock are to be issued in connection with the Banks Application for Approval of a Minority Stock Offering and Reorganization from a state chartered mutual savings bank to a state chartered stock savings bank as a subsidiary of a mid-tier holding company.

 

The Application is being filed with the Federal Reserve Board (FRB) and the Securities and Exchange Commission ("SEC"). Such Application for Conversion has been reviewed by us, including the Prospectus and related documents, and discussed with the Banks management and the Banks conversion counsel, Luse Gorman, PC, Washington, D.C.

 

This conversion appraisal was prepared based on regulatory guidelines entitled "Guidelines for Appraisal Reports for the Valuation of Savings Institutions Converting from the Mutual to Stock Form of Organization," and the Revised Guidelines for Appraisal Reports and represents a full appraisal report. The Report provides detailed exhibits based on the Revised Guidelines and a discussion on each of the factors that need to be considered. Our valuation will be updated in accordance with the Revised Guidelines and will consider any changes in market conditions for thrift institutions.

 

 1 

 

 

Introduction (cont.)

 

The pro forma market value is defined as the price at which the stock of the Corporation after conversion would change hands between a typical willing buyer and a typical willing seller when the former is not under any compulsion to buy and the latter is not under any compulsion to sell, and with both parties having reasonable knowledge of relevant facts in an arm's-length transaction. The appraisal assumes the Bank is a going concern and that the shares issued by the Corporation in the conversion are sold in noncontrol blocks.

 

As part of our appraisal procedure, we have reviewed the financial statements for the five years ended September 30, 2013, 2014, 2015, 2016 and 2017, and unaudited financial statements for the nine months ended June 30, 2017 and 2018, and discussed them with Equitable’s management and with Equitable’s independent auditors, Baker Tilly Virchow Krause, LLP, Milwaukee, Wisconsin, for the nine months ended June 30, 2018, and Cherry Bekaert LLP, Richmond, Virginia, for the years ended September 30, 2013 through 2017. We have also discussed and reviewed with management other financial matters and have reviewed internal projections. We have reviewed the Corporation's preliminary Form S-1 and the related filings and discussed them with management and with the Bank’s conversion counsel.

 

To gain insight into the Bank’s local market condition, we have visited Equitable’s market area where its six offices and one loan production office are located. The Bank’s six offices are located in Milwaukee, Racine and Waukesha Counties with its loan production office located in Ozaukee County.

 

We have studied the economic and demographic characteristics of the primary market area, and analyzed the Bank’s primary market area relative to Wisconsin and the United States. We have also examined the competitive market within which Equitable operates, giving consideration to the area's numerous financial institution offices, mortgage banking offices, and credit union offices and other key market area characteristics, both positive and negative.

 

 2 

 

 

Introduction (cont.)

 

We have given consideration to the market conditions for securities in general and for publicly traded thrift stocks in particular. We have examined the performance of selected publicly traded thrift institutions and compared the performance of Equitable to those selected institutions.

 

Our valuation is not intended to represent and must not be interpreted to be a recommendation of any kind as to the desirability of purchasing the to-be-outstanding shares of common stock of the Corporation. Giving consideration to the fact that this appraisal is based on numerous factors that can change over time, we can provide no assurance that any person who purchases the stock of the Corporation in this mutual-to-stock conversion will subsequently be able to sell such shares at prices similar to the pro forma market value of the Corporation as determined in this conversion appraisal.

 

 3 

 

 

I.DESCRIPTION OF THE EQUITABLE BANK, S.S.B.

 

GENERAL

 

The Equitable Bank, S.S.B. (Equitable) was organized in 1927 as a Wisconsin chartered mutual building and loan association with the name, The Equitable Savings Building and Loan Association. The Bank changed its name to The Equitable Bank, S.S.B. and converted to a Wisconsin chartered mutual savings bank in 1993.

 

Equitable conducts its business from its main office in Wauwatosa and its five branches, one in West Allis, one in Whitefish Bay, one in Hales Corners, one in Waterford, and one in Delafield with four offices in Milwaukee County, one office in Racine County and one office in Waukesha County. The Banks primary retail market area is focused on Milwaukee County, extending into Racine and Waukesha Counties. The Bank also has one loan production office in Cedarburg in Ozaukee County.

 

Equitables deposits are insured up to applicable limits by the Federal Deposit Insurance Corporation ("FDIC") in the Bank Insurance Fund ("BIF"). The Bank is also subject to certain reserve requirements of the Board of Governors of the Federal Reserve Bank (the "FRB"). Equitable is a member of the Federal Home Loan Bank (the "FHLB") of Chicago and is regulated by the Federal Deposit Insurance Corporation (FDIC) and the Wisconsin Department of Financial Institutions (WDFI). As of June 30, 2018, Equitable had assets of $313,424,042 deposits of $244,463,480 and equity of $14,102,132.

 

Equitable has been principally engaged in the business of serving the financial needs of the public in its local communities and throughout its primary market area as a community-oriented institution. Equitable has been involved in the origination of one- to four-family mortgage loans, which represented 55.2 percent of its total loans at June 30, 2018. One- to four-family mortgage loans represented a lesser 53.3 percent of total loans at December 31, 2014. The primary sources of funds for these loans have been retail deposits from residents in its local communities and to a lesser extent, FHLB advances. The Bank is also an originator of multi- family loans, commercial real estate loans, construction loans, commercial business loans and consumer loans. Consumer loans include home equity loans, automobile loans, loans on deposit accounts and other secured and unsecured personal loans.

 

 4 

 

 

General (cont.)

 

The Bank had cash and investments of $27.2 million, or 8.7 percent of its assets, excluding FHLB stock which totaled $2,070,000 or 0.7 percent of assets at June 30, 2018. The Bank had $1.2 million of its investments in mortgage-backed and related securities representing 0.4 percent of assets. Deposits, principal payments, FHLB advances and equity have been the primary sources of funds for the Bank’s lending and investment activities.

 

The total amount of stock to be sold by the Corporation in the minority stock offering will be $10,350,000 or 1,035,000 shares at $10 per share, representing 45.0 percent of the midpoint fully converted appraised value of $23.0 million. The net conversion proceeds will be $9.1 million, net of conversion expenses of approximately $1,275,000. The actual cash proceeds to the Bank of $8.2 million will represent 90.0 percent of the net conversion proceeds. The ESOP will represent 7.0 percent of a 45.0 percent minority offering or 72,450 shares, $724,500 or 3.15 percent of the total value. The Bank’s net proceeds will be used to fund new loans and to invest in securities following their initial deployment to short term investments. The Bank may also use the proceeds to expand services, expand operations or acquire other financial service organizations, diversify into other businesses, or for any other purposes authorized by law. The Corporation will use its proceeds to fund the ESOP.

 

The Bank has experienced a modest deposit decrease over the past four fiscal years, with deposits decreasing 6.1 percent from September 30, 2014, to September 30, 2017, or an average of 2.0 percent per year. From September 30, 2016, to September 30, 2017, deposits decreased by $17.4 million or 6.2 percent, compared to an increase of 5.0 percent in fiscal 2016. For the nine months ended June 30, 2018, deposits decreased a modest 6.2 percent or 8.2 percent on an annualized basis.

 

 5 

 

 

General (cont.)

 

The Bank has experienced an increase in its loan portfolio during the past four years and in the most recent nine months and has focused on monitoring its asset quality position, on controlling its net interest margin and on maintaining a reasonable equity to assets ratio. Equity to assets decreased from 5.31 percent of assets at September 30, 2014, to 4.67 percent at September 30, 2017, and then decreased to 4.50 percent at June 30, 2018.

 

The primary lending strategy of Equitable has been to focus on the origination of adjustable-rate and fixed-rate one-to four-family mortgage loans, the origination of home equity loans, commercial real estate loans, multi-family loans, and consumer loans, with less activity in construction loans and commercial loans.

 

The Bank’s share of one- to four-family mortgage loans has increased slightly from 53.3 percent of gross loans at September 30, 2014, to 55.2 percent at June 30, 2018. Multi-family loans increased from 17.3 percent to 26.8 percent, and commercial real estate loans decreased from 16.3 percent of loans to 11.1 percent of loans. Construction loans decreased from 6.2 percent of loans to 1.8 percent from September 30, 2014, to June 30, 2018. All types of real estate loans, excluding home equity loans, as a group increased slightly from 93.1 percent of gross loans at September 30, 2014, to 94.1 percent at June 30, 2018. The increase in real estate loans was offset by the Bank’s decreases in combined commercial business loans and consumer loans, including home equity loans. The Bank’s share of consumer loans decreased from a modest 6.5 percent to 4.3 percent during the same time period, and commercial business loans increased from 0.4 percent to 0.8 percent of gross loans.

 

Management's internal strategy has also included continued emphasis on maintaining an adequate and appropriate level of allowance for loan losses relative to loans and nonperforming assets in recognition of the more stringent requirements within the industry and also in recognition of the Banks significant decreases in nonaccrual loan and nonperforming assets. At September 30, 2014, Equitable had $3,972,000 in its loan loss allowance or 1.53 percent of gross loans, and 53.56 percent of nonperforming loans with the loan loss allowance decreasing to $1,324,000 and representing a lower 0.50 percent of gross loans and a higher 91.69 percent of nonperforming loans at June 30, 2018.

 

 6 

 

 

General (cont.)

 

The basis of earnings for the Bank has been interest income from loans and investments with the net interest margin being the key determinant of net earnings with an emphasis on strengthening noninterest income and reducing noninterest expenses. With a primary dependence on net interest margin for earnings, current management will focus on striving to strengthen the Banks net interest margin without undertaking excessive credit risk combined with controlling the Banks interest risk position and continue to pursue reducing noninterest expenses, continue to reduce real estate owned and maintain noninterest income.

 

 7 

 

 

PERFORMANCE OVERVIEW

 

The financial position of Equitable at fiscal year end September 30, 2013, through September 30, 2017 and at June 30, 2018, is shown in Exhibits 1 and 2, and the earnings performance of Equitable for the fiscal years ended September 30, 2013 through 2017, and for the twelve months ended June 30, 2018, is shown in Exhibits 3 and 4. Exhibit 5 provides selected financial data at September 30, 2014 through 2017 and at June 30, 2018. Equitable has experienced an increase in its loan portfolio, a decrease in its asset base and its cash and investments, and a moderate decrease in its deposits from September 30, 2014 through June 30, 2018. The most recent trend for the Bank from September 30, 2017, to June 30, 2018, was a modest increase in assets, a modest increase in cash and investments, a modest increase in loans, with a moderate decrease in deposits.

 

With regard to the Banks historical financial condition, Equitable has experienced a minimal decrease in assets from September 30, 2014, through June 30, 2018, with a modest increase in loans, a moderate decrease in deposits and a modest decrease in the dollar level of equity.

 

The Bank witnessed a decrease in assets of $1.3 million or 0.4 percent for the period of September 30, 2014, to June 30, 2018, representing an average annual decrease of 0.1 percent. Over the past two fiscal periods, the Bank experienced its largest dollar increase in assets of $7.6 million in 2016, due primarily to an $11.3 million increase in loans, with a $2.5 million decrease in real estate owned. During the Banks current fiscal year of 2017, assets increased $3.2 million or 1.1 percent, compared to an increase of $7.6 million or 2.6 percent in 2016.

 

Equitables net loan portfolio, which includes mortgage loans and nonmortgage loans, increased from $258.9 million at September 30, 2014, to $270.4 million at June 30, 2018, and represented a total increase of $11.5 million, or 4.4 percent. The average annual increase during that period was 1.18 percent. For the year ended September 30, 2017, net loans increased $2.9 million or 1.1 percent to $266.1 million, compared to an increase of $4.3 million or 1.6 percent to $270.4 million in the nine months ended June 30, 2018.

 

 8 

 

 

Performance Overview (cont.)

 

Equitable has obtained funds through deposits and FHLB advances with a moderate use of FHLB advances totaling $46.0 million at June 30, 2018. The Banks competitive rates for deposits in its local market in conjunction with its focus on service have been the sources for competing for retail deposits. Deposits decreased $17.4 million or 6.2 percent from September 30, 2016 to 2017, and decreased $16.0 million or 6.2 percent, or 8.2 percent, annualized, to $244.5 million at June 30, 2018, from September 30, 2017.

 

The Bank witnessed a modest decrease in its dollar equity level from September 30, 2014, to June 30, 2018. At September 30, 2014, the Bank had an equity level of $16.7 million, representing a 5.31 percent equity to assets ratio and decreased to $13.4 million at September 30, 2016, representing a lower 4.40 percent equity to assets ratio. At September 30, 2017, equity was a higher $14.4 million and a higher 4.67 percent of assets, and then decreased slightly to $14.1 million and a slightly lower 4.50 percent at June 30, 2018.

 

The overall decrease in the equity to assets ratio from September 30, 2014, to June 30, 2018, was impacted by the Banks higher losses on real estate owned. The dollar level of equity decreased $2.6 million or 15.7 percent from September 30, 2014, to June 30, 2018, representing an average annual decrease of 4.18 percent.

 

 9 

 

 

INCOME AND EXPENSE

 

Exhibit 6 presents selected operating data for Equitable. This table provides key income and expense figures in dollars for the years ended September 30, 2014, 2015, 2016 and 2017 and for the nine months ended June 30, 2017 and 2018.

 

Equitable witnessed a modest decrease in its dollar level of interest income from 2014 to 2017. Interest income was $12.4 million in 2014 and a lower $11.6 million in 2016. Interest income then increased in the year ended September 30, 2017, to $11.7 million or $116,000, compared to a decrease of $266,000 in 2016. In the nine months ended June 30, 2018, interest income was $8.79 million or $11.7 million, annualized, similar to fiscal 2017.

 

The Banks interest expense experienced a moderate increase from 2014 to 2017. Interest expense increased from $952,000 in 2014 to $1.2 million in 2016, representing an increase of $213,000 or 22.4 percent. Interest expense then increased by $100,000 or 8.6 percent in 2017 to $1.27 million. In the nine months ended June 30, 2018, interest expense was $1.26 million or a higher $1.67 million, annualized. Such decrease in interest income from 2014 through June 30, 2018, relative to the increase in interest expense, resulted in a modest dollar decrease in annual net interest income and a decrease in net interest margin. Net interest income decreased in the year ended September 30, 2016, to $10,444,000, then increased to $10,461,000 in 2017 and then decreased to $7,536,000 in the nine months ended June 30, 2018, or $10,048,000, annualized.

 

The Bank has made provisions for loan losses in two of the past four years of 2014 through 2017 and in the nine months ended June 30, 2018. The amounts of those provisions were determined in recognition of the Bank’s levels of loans, nonperforming assets, charge-offs and repossessed assets. The loan loss provisions were $2,067,000 in 2014, $2,125,000 in 2016, and $425,000 in the nine months ended June 30, 2018. The impact of these loan loss provisions has been to provide Equitable with a general valuation allowance of $1,324,000 at June 30, 2018, or 0.50 percent of gross loans and 91.69 percent of nonperforming loans.

 

 10 

 

 

Income and Expense (cont.)

 

Total other income or noninterest income indicated a minimal decrease in dollars from 2014 to 2017 and then a decrease in the nine months ended June 30, 2018. Noninterest income was $2,626,000 or 0.83 percent of assets in 2014 and a higher $3,214,000 in 2016 or 1.07 percent of assets. In the year ended September 30, 2017, noninterest income was a lower $2,623,000, representing 0.85 percent of assets. In the nine months ended June 30, 2018, noninterest income was $1,924,000 or 0.82 percent of assets, on an annualized basis. Noninterest income consists primarily of gains and losses on the sale of loans, servicing fees on loans, service charges and other income.

 

The Banks general and administrative expenses or noninterest expenses decreased from $16.86 million for the year of 2014 to $13.43 million for the year ended September 30, 2016, representing a decrease of 20.3 percent, then decreased to $12.87 million for the year ended September 30, 2017, or a 4.2 percent decrease, and then increased to $10.06 million or $13.41 million, annualized, for the nine months ended June 30, 2018. On a percent of average assets basis, operating expenses decreased from 5.31 percent of average assets for the year ended September 30, 2014, to 4.48 percent for the year ended September 30, 2016, then decreased to 4.26 percent for the year ended September 30, 2017, and then increased to 4.48 percent for the nine months ended June 30, 2018, annualized.

 

The net earnings position of Equitable has indicated volatility from 2014 through 2017. The annual net income (loss) figures for the years of 2014, 2015, 2016 and 2017 were $(4,854,000), $(608,000), $(1,674,000) and $212,000, respectively, and $(602,000) for the nine months ended June 30, 2018, representing returns on average assets of (1.51) percent, (0.20) percent, (0.56) percent and 0.07 percent for fiscal years 2014, 2015, 2016 and 2017, respectively, and (0.27) percent for the nine months ended June 30, 2018, annualized.

 

Exhibit 7 provides the Banks normalized earnings or core earnings for the twelve months ended June 30, 2018. The Banks normalized earnings typically eliminate any nonrecurring income and expense items. There were two expense adjustments, resulting in the normalized income being better than actual earnings for the twelve months ended June 30, 2018, and equal to $(133,000). The core income adjustment was a reduction in provision for loan losses of $425,000 and reduction in real estate owned losses of $234,000.

 

 11 

 

 

Income and Expense (cont.)

 

The key performance indicators comprised of selected performance ratios, asset quality ratios and capital ratios are shown in Exhibit 8 to reflect the results of performance. The Banks return on average assets changed from (1.51) percent in 2014, to (0.20 percent in 2015, to (0.56) in 2016, to 0.07 percent in 2017, and then to (0.27) percent in the nine months ended June 30, 2018.

 

The Banks net interest rate spread decreased from 4.07 percent in 2014 to 3.70 percent in 2016, then decreased to 3.67 percent in 2017, and then decreased to 3.57 percent in the nine months ended June 30, 2018. The Banks net interest margin indicated a somewhat similar trend, decreasing from 4.07 percent in 2014 to 3.73 percent in 2016, then decreased to 3.70 percent in 2017, and decreased to 3.61 percent in the nine months ended June 30, 2018. Equitables net interest rate spread decreased 37 basis points from 2014 to 2016, then decreased 3 basis points in 2017 and then decreased 10 basis points in the next three quarters ended June 30, 2018. The Banks net interest margin followed a similar overall trend, decreasing 34 basis points from 2014 to 2016, then decreasing 3 basis points from 2016 to 2017 and then decreasing 9 basis points in the next three quarters ended June 30, 2018.

 

The Banks return on average equity improved from 2014 to 2017, and then decreased in the nine months ended June 30, 2018. The return on average equity increased from (22.96) percent in 2014, to (10.54) percent in 2016, then increased to 1.60 percent in 2017, and then decreased to (5.72) percent in the nine months ended June 30, 2018.

 

 12 

 

 

Income and Expense (cont.)

 

Equitables ratio of average interest-earning assets to interest-bearing liabilities increased modestly from 101.07 percent at September 30, 2014, to 106.34 percent at September 30, 2016, then remained at 106.38 percent at September 30, 2017, and then decreased slightly to 106.10 percent at June 30, 2018. The Banks overall increase in its ratio of interest-earning assets to interest-bearing liabilities is primarily the result of the Banks decrease in its interest-bearing liabilities.

 

The Banks ratio of noninterest expenses to average assets decreased from 5.28 percent in 2014 to 4.47 percent in 2016, then decreased to 4.26 percent in 2017, and then increased to 4.48 percent in the nine months ended June 30, 2018. Another key noninterest expense ratio reflecting efficiency of operation is the ratio of noninterest expenses to noninterest income plus net interest income referred to as the "efficiency ratio." The industry norm is 56.1 percent for all thrifts and 71.3 percent for thrifts with assets of $100.0 million to $1.0 billion, with the lower the ratio indicating higher efficiency. The Bank has been characterized with a higher level of efficiency historically reflected in its higher efficiency ratio, which decreased from 119.60 percent in 2014 to 98.33 percent in 2016, increased to 98.38 percent in 2017, and then increased to 106.39 percent in the nine months ended June 30, 2018.

 

Earnings performance can be affected by an institution's asset quality position. The ratio of nonperforming loans to total loans is a key indicator of asset quality. Equitable witnessed a significant decrease in its nonperforming loans ratio from September 30, 2014 to June 30, 2018, and the ending ratio is modestly below the industry norm. Nonperforming loans, by definition, consist of loans delinquent 90 days or more, troubled debt restructurings that have not been performing for at least three months, and nonaccruing loans. Equitable’s nonperforming loans consisted of nonaccrual loans, loans accruing but 90 days past due, with no nonaccruing troubled debt restructured loans. The ratio of nonperforming loans to total loans was 0.55 percent at June 30, 2018, decreasing from 0.67 percent at September 30, 2017, and decreasing from 2.89 percent at September 30, 2014.

 

 13 

 

 

Income and Expense (cont.)

 

Two other indicators of asset quality are the Bank’s ratios of allowance for loan losses to total loans and also to nonperforming loans. The Bank’s allowance for loan losses was 1.55 percent of loans at September 30, 2014, increased to 1.77 percent at September 30, 2016, then decreased to 0.72 percent of loans at September 30, 2017, and then decreased to 0.50 percent at June 30, 2018. As a percentage of nonperforming loans, Equitables allowance for loan losses to nonperforming loans was 53.55 percent at September 30, 2014, a slightly higher 57.48 percent at September 30, 2016, a higher 106.46 percent at September 30, 2017, and a lesser 91.69 percent at June 30, 2018.

 

Exhibit 9 provides the changes in net interest income due to rate and volume changes for the fiscal year ended September 30, 2017, and for the nine months ended June 30, 2018. For the year ended September 30, 2017, net interest income increased $27,000, due to an increase in interest income of $116,000, decreased by an $89,000 increase in interest expense. The increase in interest income was due to an increase due to volume of $221,000, reduced by a decrease due to rate of $105,000. The increase in interest expense was due to a $73,000 increase due to rate, accented by a $16,000 increase due to volume.

 

For the nine months ended June 30, 2018, net interest income decreased $260,000, due to an increase in interest income of $60,000, reduced by an increase in interest expense of $321,000. The increase in interest income was due to a decrease due to volume of $77,000, offset by an increase due to rate of $137,000. The increase in interest expense was due to an increase due to volume of $135,000, accented by an increase due to rate of $185,000.

 

 14 

 

 

YIELDS AND COSTS

 

The overview of yield and cost trends for the years ended September 30, 2016 and 2017 and for the nine months ended June 30, 2017 and 2018, and at June 30, 2018, can be seen in Exhibit 10, which offers a summary of key yields on interest-earning assets and costs of interest-bearing liabilities.

 

Equitables weighted average yield on its loan portfolio decreased 5 basis points from fiscal year 2016 to 2017, from 4.37 percent to 4.32 percent and then increased 2 basis points to 4.34 percent for the nine months ended June 30, 2018. The yield on investment securities increased from 2.64 percent to 2.65 percent from 2016 to 2017 or 1 basis point, and then increased to 2.79 percent in the nine months ended June 30, 2018. The yield on other interest-earning assets increased from 0.80 percent to 1.13 percent from 2016 to 2017 or 33 basis points and then decreased to 1.12 percent in the nine months ended June 30, 2018. The combined weighted average yield on all interest-earning assets remained at 4.15 percent in fiscal year 2016 and 2017 and then increased 5 basis points to 4.20 percent in the nine months ended June 30, 2018. At June 30, 2018, the yield on earnings assets was a lower 4.07 percent.

 

Equitables weighted average cost of interest-bearing liabilities increased 3 basis points to 0.48 percent from fiscal year 2016 to 2017, which was more than the Banks zero basis point change in yield, resulting in a decrease in the Banks net interest rate spread of 3 basis points from 3.70 percent to 3.67 percent from 2016 to 2017. The Banks cost of interest-bearing liabilities then increased 16 basis points to 0.64 percent, which was more than the Banks 5 basis point increase in yield, resulting in a decrease in the Banks net interest rate spread. The Banks interest rate spread decreased 11 basis points in the nine months ended June 30, 2018, to 3.57 percent. The Banks net interest margin decreased from 3.73 percent in 2016 to 3.70 percent in fiscal year 2017, representing a decrease of 3 basis points and then decreased to 3.61 percent in the nine months ended June 30, 2018. The Banks net interest rate spread was a lower 3.50 percent at June 30, 2018.

 

 15 

 

 

Yields and Costs (cont.)

 

The Banks ratio of average interest-earning assets to interest-bearing liabilities was 106.3 percent for the year ended September 30, 2016, and a similar 106.4 percent for the year ended September 30, 2017, and then decreased to 106.1 percent at June 30, 2018.

 

 16 

 

 

INTEREST RATE SENSITIVITY

 

Equitable has monitored its interest rate sensitivity position and focused on maintaining a reasonable level of interest rate risk exposure by maintaining higher shares of adjustable-rate residential mortgage loans, commercial real estate loans and multi-family loans and adjustable-rate home equity loans to offset its moderate share of fixed-rate residential mortgage loans. Equitable recognizes the thrift industrys historically higher interest rate risk exposure, which caused a negative impact on earnings and economic value of equity in the past as a result of significant fluctuations in interest rates, specifically rising rates in the past. Such exposure was due to the disparate rate of maturity and/or repricing of assets relative to liabilities commonly referred to as an institutions gap.The larger an institutions gap, the greater the risk (interest rate risk) of earnings loss due to a decrease in net interest margin and a decrease in economic value of equity or portfolio loss. In response to the potential impact of interest rate volatility and negative earnings impact, many institutions have taken steps to reduce their gap position. This frequently results in a decline in the institutions net interest margin and overall earnings performance. Equitable has responded to the interest rate sensitivity issue by maintaining a higher share of adjustable-rate one to four family loans.

 

The Bank measures its interest rate risk through the use of its net economic value (NEV) of the expected cash flows from interest-earning assets and interest-bearing liabilities and any off-balance sheets contracts. The NEV for the Bank is calculated on a quarterly basis by an outside firm, showing the Banks NEV to asset ratio, the dollar change in NEV, and the change in the NEV ratio for the Bank under rising and falling interest rates. Such changes in NEV ratio under changing rates are reflective of the Banks interest rate risk exposure.

 

There are numerous factors which have a measurable influence on interest rate sensitivity in addition to changing interest rates. Such key factors to consider when analyzing interest rate sensitivity include the loan payoff schedule, accelerated principal payments, sale of fixed-rate loans, deposit maturities, interest rate caps on adjustable-rate mortgage loans and deposit withdrawals.

 

 17 

 

 

Interest Rate Sensitivity (cont.)

 

Exhibit 10 provides the Banks NEV levels and ratios as of May 31, 2018, based on the most recent calculations and reflects the changes in the Banks NEV levels under rising and declining interest rates.

 

The Banks change in its NEV level at May 31, 2018, based on a rise in interest rates of 200 basis points was a 14.22 percent decrease, representing a dollar decrease in equity value of $4,089,000. In contrast, based on a decline in interest rates of 200 basis points, the Banks NEV level was estimated to increase 0.02 percent or $6,000 at May 31, 2018. The Banks exposure increases to a 38.82 percent decrease under a 400 basis point rise in rates, representing a dollar decrease in equity of $11,162,000. The Banks exposure, based on a 400 basis point decrease in interest rates, is an increase of 21.32 percent or $6,129,000.

 

The Banks post shock NEV ratio based on a 200 basis point rise in interest rates is 8.95 percent and indicates an 82 basis point decrease from its 9.77 percent based on no change in interest rates.

 

The Bank is aware of its interest rate risk exposure under rapidly rising rates and falling rates. Due to Equitables recognition of the need to control its interest rate exposure, the Bank has been active in the origination of adjustable-rate loans. The Bank plans to increase its lending activity in the future and continue to maintain its higher share of adjustable-rate loans. The Bank will also continue to focus on strengthening its NEV ratio, recognizing the planned conversion and minority stock offering will strengthen the Banks equity level and NEV ratio, based on any change in interest rates.

 

 18 

 

 

LENDING ACTIVITIES

 

Equitable has focused its lending activity on the origination of conventional mortgage loans secured by one- to four-family dwellings, multi-family loans, commercial real estate loans, consumer and home equity loans, commercial business loans and construction loans. Exhibit 12 provides a summary of Equitables loan portfolio by loan type at September 30, 2014 through 2017, and at June 30, 2018.

 

The primary loan type for Equitable has been residential loans secured by one- to four-family dwellings, representing a strong 55.2 percent of the Banks gross loans as of June 30, 2018. This share of loans has seen a slight increase from 53.3 percent at September 30, 2014. The second largest real estate loan type as of June 30, 2018, was multi-family loans, which comprised a strong 26.8 percent of gross loans at June 30, 2018, compared to 17.3 percent as of September 30, 2014. The third largest real estate loan type was commercial real estate loans, which comprised a moderate 11.1 percent of gross loans at June 30, 2018, compared to a larger 16.3 percent at September 30, 2014. The fourth largest real estate loan category was construction loans, which represented 1.8 percent of gross loans at June 30, 2018, and a larger 6.2 percent at September 30, 2014. These four real estate loan categories represented a strong 94.9 percent of gross loans at June 30, 2018, compared to a similar 93.1 percent of gross loans at September 30, 2014.

 

The Bank had a minimal 0.8 percent of loans in commercial business loans at June 30, 2018, up from 0.4 at September 30, 2014. The consumer loan category, which includes home equity loans and lines of credit, was the fourth largest loan category at June 30, 2018, and represented a modest 4.3 percent of gross loans compared to 6.5 percent at September 30, 2014. Consumer loans were also the fourth largest loan category at September 30, 2014. The Banks consumer loans include home equity loans and lines of credit, savings account loans, automobile loans, and other secured and unsecured loans. The overall mix of loans has witnessed moderate changes from September 30, 2014, to June 30, 2018, with the Bank having increased its shares of one- to four-family loans and multi-family loans, offset by decreases in its shares of commercial real estate loans and construction loans.

 

 19 

 

 

Lending Activities (cont.)

 

The emphasis of Equitables lending activity is the origination of conventional mortgage loans secured by one- to four-family residences. Such residences are located primarily in Milwaukee, Racine and Waukesha Counties and to a lesser extent in the adjacent Ozaukee County. At June 30, 2018, 55.2 percent of Equitables gross loans consisted of loans secured by one- to four-family residential properties, both owner-occupied and nonowner-occupied, excluding construction loans.

 

The Bank offers several types of adjustable-rate mortgage loans ("ARMs"), with adjustment periods ranging from one year to ten years. The interest rates on ARMs are generally indexed to the one-year LIBOR. ARMs have a maximum rate adjustment of 2.0 percent at each adjustment period and 6.0 percent for the life of the loan. Rate adjustments are computed by adding a stated margin to the index, the one-year LIBOR. The Bank normally retains the ARMs which it originates. The majority of ARMs have terms of up to 30 years, which is the maximum term offered, with the Bank having an introductory rate period of 10 years.

 

The Banks other key one- to four-family mortgage loan product is a fixed-rate one- to four-family mortgage loan with Equitables fixed-rate mortgage loans having terms of up to 30 years. The majority of fixed-rate one- to four-family mortgage loans have a term of 30 years. The Banks fixed-rate residential mortgage loans normally conform to Freddie Mac or Fannie Mae underwriting standards. The Bank also originates conforming jumbo loanswhich are residential mortgage loans. The Bank normally sells its jumbo fixed-rate residential mortgage loans in the secondary market, with the Bank selling these loans servicing released.

 

The Banks one- to four-family mortgage loans remain outstanding for shorter periods than their contractual terms, because borrowers have the right to refinance or prepay. These mortgage loans contain due on saleclauses which permit the Bank to accelerate the indebtedness of the loan upon transfer of ownership of the mortgage property.

 

 20 

 

 

Lending Activities (cont.)

 

The normal loan-to-value ratio for conventional mortgage loans to purchase or refinance one-to four-family dwellings generally does not exceed 80 percent at Equitable, even though the Bank is permitted to make loans up to a 97.0 percent loan-to-value ratio. While the Bank does make loans up to 97.0 percent of loan-to-value, the Bank requires private mortgage insurance for the amount in excess of the 80.0 percent loan-to-value ratio for fixed-rate residential loans and adjustable-rate residential loans. Mortgage loans originated by the Bank include due-on-sale clauses enabling the Bank to adjust rates on fixed-rate mortgage loans in the event the borrower transfers ownership. The Bank also requires an escrow account for insurance and taxes on residential mortgage loans with a loan-to-value ratio in excess of 80.0 percent.

 

Equitable has also been an originator of balloon multi-family loans and commercial real estate loans in the past and will continue to make multi-family and commercial real estate loans. The Banks multi-family loans have a fixed-rate for up to seven years with an amortization term up to 25 years on a normal basis. Commercial real estate loans are also balloon loans with an initial term of three, five or seven years and a 25-year amortization period. The Bank had a total of $71.1 million in multi-family loans and $29.5 million in commercial real estate loans at June 30, 2018, or a combined 37.9 percent of gross loans, compared to a lesser 33.6 percent of gross loans at September 30, 2014.

 

The major portion of commercial real estate and multi-family loans are secured by apartment buildings, small retail establishments, office buildings, and other owner-occupied properties used for business. The maximum loan-to-value ratio is normally 75.0 percent for both multi-family loans and commercial real estate loans.

 

The Bank also originates construction and land development loans. The Bank had $4.8 million or 1.8 percent of gross loans in construction and development loans at June 30, 2018. The maximum loan-to-value ratio is 70.0 percent of the contract price or completed appraised value, whichever is less.

 

 21 

 

 

Lending Activities (cont.)

 

The Bank has not been relatively active in home equity loans or lines of credit, which totaled $11.0 million or 4.1 percent of gross loans at June 30, 2018. The interest rate for home equity lines of credit is tied to the prevailing prime interest rate as reported in the Wall Street Journal. Home equity loans or lines of credit are generally 10-year balloon loans with a loan-to-value ratio of up to 80.0 percent.

 

Equitable is also an originator of commercial business loans, which represented a minimal 0.8 percent of loans at June 30, 2018. The Bank had $1.1 million in commercial business loans at September 30, 2014, or 0.4 percent of loans. These loans are normally adjustable-rate and indexed to the Wall Street Journal prime rate or fixed-rate with a term of one to seven years.

 

Exhibit 13 provides a loan maturity schedule and breakdown and a summary of Equitable’s fixed- and adjustable-rate loans, indicating a majority of adjustable-rate loans. At June 30, 2018, 42.3 percent of the Bank’s loans due after June 30, 2019, were fixed-rate and 57.7 percent were adjustable-rate. At June 30, 2018, the Bank had 30.1 percent of its loans due on or before June 30, 2023, or in five years or less. The Bank had a larger 69.9 percent of its loans with a maturity of more than five years.

 

 22 

 

 

NONPERFORMING ASSETS

 

Equitable understands asset quality risk and the direct relationship of such risk to delinquent loans and nonperforming assets, including real estate owned. The quality of assets has been a key concern to financial institutions throughout many regions of the country. A number of financial institutions have been confronted with higher levels of nonperforming assets in the past and have been forced to recognize significant losses, setting aside major valuation allowances.

 

A sharp increase in nonperforming assets has often been related to specific regions of the country and has frequently been associated with higher risk loans, including commercial real estate loans and multi-family loans and nonowner-occupied single-family loans. Equitable has a higher level of nonperforming assets, with nonperforming assets having decreased significantly since 2014.

 

Exhibit 14 provides a summary of Equitable’s delinquent loans at September 30, 2014 2015, 2016 and 2017, and at June 30, 2018, indicating an overall decrease in the dollar amount of delinquent loans from September 30, 2014, to June 30, 2018. The Bank had $2,341,000 in loans delinquent 30 to 89 days at June 30, 2018. Loans delinquent 90 days or more totaled $1,444,000 at June 30, 2018, with these categories representing 1.36 percent of net loans, with most of them one- to four-family real estate loans. At September 30, 2014, delinquent loans of 30 to 89 days totaled $2,700,000 or 1.05 percent of net loans and loans delinquent 90 days or more totaled $7,416,000 or 2.86 percent of net loans for a combined total of $10,116,000 and a higher share of 3.91 percent of net loans, compared to a lower $3,685,000 and a lower 1.36 percent of net loans at June 30, 2018.

 

It is normal procedure for Equitables board to review loans delinquent 90 days or more on a monthly basis, to assess their collectibility and possibly commence foreclosure proceedings. When a loan is delinquent 15 days, the Bank sends a late notice to the borrower and also contact the borrower by a phone call. After 90 days delinquency, a demand letter is sent. When the loan becomes delinquent 90 days, the Bank considers the loan in default and it is placed on nonaccrual status. A decision as to whether and when to initiate foreclosure proceedings is based on such factors as the amount of the outstanding loan, the extent of the delinquency and the borrowers ability and willingness to cooperate in curing the delinquency. The Bank generally initiates foreclosure when a loan has been delinquent 90 days and no workout agreement has been reached.

 

 23 

 

 

Nonperforming Assets (cont.)

 

Exhibit 15 provides a summary of Equitables nonperforming assets at September 30, 2014, 2015, 2016 and 2017, and at June 30, 2018. Nonperforming assets, by definition, include loans 90 days or more past due, nonaccruing loans, troubled debt restructurings that have not performed, and repossessed assets. The Bank carried a much lower dollar level of nonperforming assets at June 30, 2018, relative to September 30, 2014. Equitables level of nonperforming assets was $22,530,000 at September 30, 2014, and a lower $5,401,000 at June 30, 2018, which represented 7.16 percent of assets in 2014 and 1.72 percent June 30, 2018. The Banks nonperforming assets included $7,416,000 in nonaccrual loans, $1,428,000 in loans 90 days or more past due and $13,686,000 in real estate owned for a total of $22,530,000 at September 30, 2014. At June 30, 2018, nonperforming assets were a lower $5,401,000 or a lower 1.72 percent of assets and included $1,444,000 in nonaccrual loans, $3,957,000 in real estate owned, with no loans 90 days or more past due.

 

Equitables levels of nonperforming assets were lower than its levels of classified assets. The Banks ratios of classified assets to assets, excluding special mention assets, were 2.63 percent of assets at September 30, 2017, and a lower 1.94 percent at June 30, 2018 (reference Exhibit 16). The Banks classified assets consisted of $5,901,000 in substandard assets, with no assets classified as doubtful and $175,000 in assets classified as loss at June 30, 2018. The Bank had $8,076,000 in assets classified as substandard, no assets classified as doubtful, and $200,000 in assets classified as loss at September 30, 2017.

 

 24 

 

 

Nonperforming Assets (cont.)

 

Exhibit 17 shows Equitables allowance for loan losses at September 30, 2014, 2015, 2016 and 2017, and at June 30, 2018, indicating the activity and the resultant balances. Equitable has witnessed a moderate decrease in its balance of allowance for loan losses from $3,972,000 at September 30, 2014, to $1,324,000 at June 30, 2018, in response to its significant decrease in its nonperforming assets. The Bank had provisions for loan losses of $2,067,000 in 2014, $2,125,000 in 2016, to $425,000 in the nine months ended June 30, 2018.

 

The Bank had total charge-offs of $2,419,000 in 2014, $1,444,000 in 2015, $414,000 in 2016, $2,675,000 in 2017, and $1,035,000 in the nine months ended June 30, 2018, with total recoveries of $248,000 in 2014, $59,000 in 2015, $185,000 in 2016, $72,000 in 2017, and $55,000 in the nine months ended June 30, 2018. The Bank’s ratio of allowance for loan losses to gross loans was 1.53 percent at September 30, 2014, a lower 0.71 percent at September 30, 2017, and a lower 0.50 percent at June 30, 2018. Allowance for loan losses to nonperforming loans was 53.56 percent at September 30, 2014, and a higher 106.46 percent at September 30, 2017, and then 91.69 percent at June 30, 2018.

 

 25 

 

 

INVESTMENTS

 

The investment and securities portfolio, including certificates of deposit, has been comprised of commercial paper, municipal securities, interest-bearing deposits and mortgage-backed securities. Exhibit 18 provides a summary of Equitable’s investment portfolio at September 30, 2016 , 2017, and at June 30, 2018, excluding FHLB stock. Investment securities totaled $20.9 million at June 30, 2018, based on fair value, compared to $23.6 million at September 30, 2016. The Bank had $21.5 million in municipal securities at September 30, 2016, and $19.4 million at June 30, 2018. Municipal securities represented the largest category of the Bank’s investments at June 30, 2018, comprising 92.9 percent of investments, followed by mortgage-backed securities. In 2016, municipal securities was also the largest investment category, representing 91.4 percent of investments, followed by commercial paper.

 

The second key component of investments at June 30, 2018, was mortgage-backed securities, totaling $1.2 million and representing 5.5 percent of total investments, excluding FHLB stock, compared to $39,000 and a lesser 0.2 percent at September 30, 2016. The Bank had $2,070,000 in FHLB stock at June 30, 2018. The weighted average yield on investment securities was 2.79 percent for the nine months ended June 30, 2018, and a lesser 2.64 percent in 2016.

 

 26 

 

 

DEPOSIT ACTIVITIES

 

The mix of deposits by amount at September 30, 2016 and 2017, and at June 30, 2018, is provided in Exhibit 19. There has been a moderate decrease in total deposits and a modest change in the deposit mix during this period. Total deposits have decreased from $277.9 million at September 30, 2016, to $244.5 million at June 30, 2018, representing a decrease of $33.4 million or 12.0 percent. Certificates of deposit have decreased from $126.8 million at September 30, 2016, to $97.9 million at June 30, 2018, representing a decrease of $28.9 million or 22.8 percent, while savings, transaction and MMDA accounts have decreased $4.6 million from $151.1 million at September 30, 2016, to $146.5 million at June 30, 2018, or 3.0 percent.

 

Exhibit 20 provides a breakdown of the Bank’s certificates of deposits in amounts of $250,000 or more by maturity at June 30, 2018. The largest category of these certificates based on maturity is certificates with a maturity of over one year, which represented a strong 70.8 percent of these certificates followed by certificates with a maturity of six months to twelve months, which represented a moderate 17.6 percent of certificates.

 

BORROWINGS

 

Equitable has made moderate use of FHLB advances (reference Exhibit 21) in each of the years ended September 30, 2016 and 2017, and in the nine months ended June 30, 2018. The Bank had total FHLB advances of $46.0 million at June 30, 2018, with a weighted cost of 1.59 percent during the period and a balance of a much lower $500,000 at September 30, 2016, with a weighted cost of a lower 0.42 percent during the period.

 

 27 

 

 

SUBSIDIARIES

 

Equitable has two wholly owned subsidiaries, Equitable Investment Corp. and Savings Financial Corporation. Equitable Investment Corp. is a Nevada corporation that holds all of the investment securities of Equitable, and Savings Financial Corporation is an inactive corporation that previously originated indirect automobile loans.

 

OFFICE PROPERTIES

 

Equitable had six offices at June 30, 2018, its main office in Wauwatosa and branches in West Allis, Whitefish Bay, Hales Corner, Waterford and Delafield (reference Exhibit 23). The Bank owns all of its offices except its branch in Whitefish Bay. The Bank also has a mortgage lending office in Cedarburg which it leases. At June 30, 2018, the Bank’s total investment in fixed assets, based on depreciated cost, was $8.3 million or 2.63 percent of assets.

 

 28 

 

 

MANAGEMENT

 

Mr. John P. Matter has served as president and chief executive officer of The Equitable Bank since 2004 and has also served as vice chairman since 2005. He started his banking career in 1976 and joined The Equitable Bank in 1980. Mr. Matter is chairman of the Wisconsin Humane Society and is chair of the St. Joseph & Elmbrook Memorial Hospital Foundations. He has been involved in numerous civic organizations, including This Time Tomorrow Foundation Board, Brookfield Kiwanis Club, Sharon Lynne Wilson Center, Waukesha Community Foundation Board, Prevent Blindness Wisconsin, American Diabetes Association ad the Board of the Wisconsin Bankers Association. Mr. Matter’s positions as president and chief executive officer foster clear accountability, effective decision-making, a clear and direct channel of communication from senior management to the full board of directors, and alignment on corporate strategy.

 

Ms. Jennifer L. Provancher is the executive vice president, chief operating officer and chief financial officer of The Equitable bank, where she has worked since 1991. Ms. Provancher held various positions at other financial institutions in Milwaukee, beginning in 1983, and was also an audit senior at Ernst & Young, located in Milwaukee, Wisconsin. Ms. Provancher has served on the board of the Wisconsin Club, where she is currently a member of the finance committee. She is a long-time member and past president of the Milwaukee Chapter of the Financial Managers Society and served as treasurer of the Exchange Club of Milwaukee. Ms. Provancher’s experience in banking and as a certified public accountant provides the board with insights into risk assessment, financial matters, and internal control expertise.

 

Mr. William A. Behm joined The Equitable Bank in 2008 as a review credit analyst and was named chief credit officer in 2014. Mr. Behm has over sixteen years of banking experience and was previously a small business loan underwriter with U.S. Bank, Brookfield, Wisconsin, prior to joining The Equitable Bank. Mr. Behm is also a graduate of the Graduate School of Banking, University of Wisconsin-Madison.

 

 29 

 

 

II.DESCRIPTION OF PRIMARY MARKET AREA

 

Equitable's market area is focused on Milwaukee, Racine and Waukesha Counties, Wisconsin. Exhibit 25 shows the trends in population, households and income for Milwaukee County, Racine County and Waukesha County, Wisconsin and the United States. Milwaukee Countys population increased by 0.8 percent from 2000 to 2010, Racine Countys population increased by 3.5 percent and Waukesha Countys population increased by 8.1 percent, while Wisconsins and the United Statespopulation levels increased by 6.0 percent and 9.7 percent, respectively, during the same time period. Through 2020, population is projected to increase by 0.4 percent, 0.6 percent, 5.0 percent, 3.5 percent and 7.6 percent in Milwaukee, Racine and Waukesha Counties, Wisconsin and the United States respectively.

 

More important is the trend in households. Milwaukee County experienced a 1.6 percent increase in households from 2000 through 2010, compared to increases of 6.8 percent in Racine County, 12.9 percent in Waukesha County, 9.4 percent in Wisconsin and 10.7 percent in the United States. All areas are projected to increase in number of households from 2010 through 2020, by 1.3 percent in Milwaukee County, by 0.8 percent in Racine County, by 4.7 percent in Warren County, as well as Wisconsin and the United States by 3.7 percent and 7.5 percent, respectively.

 

Milwaukee County had the lowest level of per capita income in both 2000 and 2010, while Waukesha County maintained the highest per capita income level in both years. Per capita income increased in all areas from 2000 to 2010. Milwaukee County’s per capita income increased to $24,254, Racine County’s per capita income level increased to $27,292 and Waukesha County’s per capita income level increased to $37,282. Wisconsin’s per capita income level increased to $27,192 and the United States’ increased to $26,059. In 2000, median household income in the three counties were $38,100 in Milwaukee County, $48,059 in Racine County and $62,839 in Waukesha County, with Wisconsin at $43,791 and the United States with a median household income of $41,994. Median household income increased from 2000 to 2010 by 14.4 percent, 14.2 percent, 20.4 percent, 19.6 percent and 19.2 percent to $43,599, $54,900, $75,689, $52,374 and $50,046 in Milwaukee County, Racine County, Waukesha County, Wisconsin and the United States, respectively. All areas are also projected to show increases in their median household income levels from 2010 through 2020. The median household income levels in Milwaukee, Racine and Waukesha Counties, Wisconsin and the United States are projected to increase by 14.0 percent, 3.6 percent, 11.5 percent, 9.9 percent and 23.1 percent, respectively, to $49,722, $56,863, $84,386, $57,579 and $61,618, respectively, from 2010 to 2020.

 

 30 

 

 

Description of Primary Market Area (cont.)

 

Exhibit 26 provides a summary of key housing data for Milwaukee, Racine and Waukesha Counties, Wisconsin and the United States. In 2000, Milwaukee County had the lowest rate of owner-occupancy at 52.6 percent, lower than Racine County at 70.6 percent, Waukesha County at 76.4 percent, Wisconsin at 68.4 percent and the United States at 66.2 percent. As a result, Milwaukee County supported the highest rate of renter-occupied housing at 47.4 percent, compared to 29.4 percent in Racine County, 23.6 percent in Waukesha County, 31.6 percent in Wisconsin and 33.8 percent in the United States. In 2010, owner-occupied housing decreased slightly in Milwaukee County to 51.3 percent, decreased slightly in Racine County to 69.9 percent, increased slightly in Waukesha County to 76.8 percent, decreased in Wisconsin to 68.1 percent and decreased in the United States to 65.4 percent. Conversely, the renter-occupied rates increased slightly in Milwaukee County to 48.7 percent, in Racine County to 30.1 percent, in Wisconsin to 31.9 percent and in the United States to 34.6 percent. Renter-occupied percentages decreased slightly in Waukesha County to 23.2 percent.

 

Milwaukee County's 2000 median housing value was $103,200, lower than all other areasmedian housing values. The other 2000 median housing values were $111,000 in Racine County, $170,400 in Waukesha County, $112,200 in Wisconsin with the United States’ median housing value at $119,600. The 2000 median rent in Milwaukee County was $555, which was slightly higher than Racine County at $548, but lower than Waukesha County at $726 and the United States at $602, with Wisconsin’s median rent level at the lowest level of $540. In 2010, median housing values had increased in Milwaukee County to $162,900, in Racine to $174,600, in Waukesha County to $257,700, in Wisconsin to $169,000 and in the United States to $186,200. The 2010 median rent levels were $786, $751, $906, $749 and $871, in Milwaukee, Racine and Waukesha Counties, Wisconsin and the United States, respectively.

 

 31 

 

 

Description of Primary Market Area (cont.)

 

In 2000, the major source of employment for all areas by industry group, based on share of employment, was the services industry. The services industry was responsible for the majority of employment in all three counties, Wisconsin and the United States with 47.6 percent, 39.1 percent, 40.6 percent, 41.5 percent and 46.7 percent of jobs (reference Exhibit 27). The manufacturing industry was the second major employer in Milwaukee, Racine and Waukesha Counties and Wisconsin at 18.5 percent, 28.6 percent, 21.2 percent and 22.2 percent but was the third largest employer in the United States at 14.1 percent The wholesale/retail trade group was the third major overall employer in Milwaukee, Racine and Waukesha Counties and Wisconsin at 13.6 percent, 14.7 percent, 16.6 percent, 14.8 percent, and the wholesale/retail trade group was the second major overall employer in the United States with 15.3 percent of employment. The agriculture/mining group, construction group, transportation/utilities, information and finance/insurance/real estate group combined to provide 20.3 percent of employment in Milwaukee County, 17.6 percent of employment in Racine County, 21.6 percent of employment in Waukesha County, 21.5 percent of employment in Wisconsin and 23.9 percent in the United States.

 

In 2010, the services industry, manufacturing industry and wholesale/retail trade industry provided the first, second and third highest levels of employment, respectively, for Milwaukee, Racine and Waukesha Counties and Wisconsin. In Milwaukee, Racine and Waukesha Counties and Wisconsin the manufacturing sector remained the second higher employer with the wholesale/retail industry third. The services industry accounted for 54.1 percent, 45.3 percent, 45.5 percent, 46.8 percent and 53.2 percent in Milwaukee County, Racine County, Waukesha County, Wisconsin and the United States, respectively. The manufacturing trade industry provided for 15.0 percent, 22.0 percent, 18.2 percent, 18.4 percent and 10.4 percent of employment in Milwaukee County, Racine County, Waukesha County, Wisconsin and the United States, respectively. The wholesale/retail trade group provided 12.9 percent, 13.3 percent, 15.8 percent, 14.2 percent, and 14.5 percent of employment in Milwaukee, Racine and Waukesha Counties, Wisconsin and the United States, respectively. In the 2010 Census, the agriculture/mining, construction, transportation/utilities, information, and finance/insurance/real estate sectors accounted for 18.3 percent, 19.3, 20.5 percent, 20.6 percent and 21.9 percent in Milwaukee, Racine and Waukesha Counties, Wisconsin and the United States, respectively.

 

 32 

 

 

Description of Primary Market Area (cont.)

 

Some of the largest employers in Milwaukee, Racine and Waukesha Counties are listed below.

 

Employer   Employees   Product/Service
(Waukesha County)        
Anthem Blue Cross Blue Shield   2,000   Insurance
Arandall Corp.   1,000   Printing
Community Memorial Hospital   1,000+ Healthcare
Cooper Power Systems   2,200   Energy
Fiserv, Inc.   1,000+ Data Processing
GE Healthcare Bio-Sciences Corp   6,000   Diagnosing Systems
Generac Holding   3,800   Manufacturing
Harley Davidson Motor Co.   2,700   Motorcycles/Accessories
Husco International, Inc.   530   Manufacturing
Kohl’s   7,800   Retail Sales
MetalTek International   500   Manufacturing
Milwaukee Electric Tool Corp.   600   Manufacturing
ProHealth Care   4,800   Healthcare
Quad/Graphics Inc.   7,500   Printing/Marketing
Roundy’s   2,857   Supermarkets
Target Corp.   600   Distribution
         
(Racine County)        
Aurora Healthcare Hospital   970   Healthcare
BRP US, Inc.   500   Motorized Recreational Vehicles
CNH America LLC   2,800   Manufacturing Construction Equip.
InSinkErator   1,000   Manufacturing Garbage Disposals, etc.
Nestle   500   Food, confections, snacks
Racine, City of   940   Government
Racine Unified School Distrist   2,500   Education
Ruud Lighting, subsidiary of CREE   618   Manufacturing Lighting Products
S.C. Johnson & Son., Inc.   2,600   Home products, Pest Control
Walmart Stores   728   Retail Sales
Wheaton Fransican Healthcare   2,661   Healthcare

 

 33 

 

 

Description of Primary Market Area (cont.)

 

(Milwaukee County)        
AT & T Wisconsin   3,500   Communications
Aurora Health Care   32,000   Healthcare
BMO Harris   3,400   Financial services
Briggs & Stratton   1,358   Manufacturing small engines
Columbia St. Marys   4,500   Healthcare
FIS   2,800   Financial data
Froedtest Health   10,900   Healthcare
Medical College of Wisconsin   5,300   Medical school
Northwestern Mutual   5,585   Insurance
Potawatomi Bingo Casino   3,000   Entertainment
Rockwell Automation   1,909   Power, controls & information technology
SC Johnson   2,200   Home products, pest control
We Energies   4,300   Electricity, gas & steam utility
Wheaton Franciscan Healthcare   11,000   Heathcare

 

The unemployment rate is another key economic indicator. Exhibit 28 shows the unemployment rates in Milwaukee, Racine and Waukesha Counties, Wisconsin and the United States in 2014 through May of 2018. Milwaukee and Racine Counties’ unemployment rates have been higher than the state unemployment rates, while Waukesha County’s rates have been lower than both state and national rates. In 2014, Milwaukee County had an unemployment rate of 6.9 percent, compared to unemployment rates of 6.6 percent in Racine County, 4.4 percent in Waukesha County, 5.4 percent in Wisconsin and 6.2 percent in the United States. In 2015, all areas decreased in unemployment to 5.7 percent, 5.6 percent, 3.8 percent, 4.5 percent and 5.3 percent in Milwaukee, Racine and Waukesha Counties, Wisconsin and the United States, respectively. In 2016, all areas’ unemployment rates again decreased to 5.0 percent, 4.9 percent, 3.4 percent, 4.0 percent and 4.9 percent in Milwaukee, Racine and Waukesha, Counties, Wisconsin and the United States, respectively. In 2017, Milwaukee County, Racine County, Waukesha County, Wisconsin and the United States had decreases in unemployment to 4.0 percent, 4.1 percent, 2.9 percent, 3.3 percent and 4.4 percent, respectively. Through May of 2018, all areas again had decreases in unemployment rates to 3.2 percent in Milwaukee County, to 3.1 percent in Racine County, to 2.4 percent in Waukesha County, and to 2.6 percent and 3.6 percent in Wisconsin and the United States, respectively.

 

 34 

 

 

Description of Primary Market Area (cont.)

 

Exhibit 29 provides deposit data for banks and thrifts in Milwaukee, Racine and Waukesha Counties in which the Bank has its offices. Equitables deposit base in Milwaukee County was approximately $228.0 million or an 8.7 percent share of the $2.6 billion total thrift deposits and a 0.4 percent share of the total deposits, which were approximately $53.4 billion as of June 30, 2017. Equitables deposit base in Racine County was approximately $32.9 million or a 16.2 percent share of the $202.3 million total thrifts deposits and a 1.1 percent share of total deposits, which were approximately $3.1 billion as of June 30, 2017. Equitables deposit base in Waukesha County was approximately $22.8 million or a 1.5 percent share of the $1.5 billion total thrift deposits and a 0.2 percent share of the total deposits, which were approximately $12.0 billion as of June 30, 2017. The total market area is dominated by banks, with bank deposits accounting for approximately 93.6 percent of deposits at June 30, 2017.

 

Exhibit 30 provides interest rate data for each quarter for the years 2014 through the second quarter of 2018. The interest rates tracked are the Prime Rate, as well as 90-Day, One-Year and Thirty-Year Treasury Bills. Short term interest rates were stable in 2014, increased modestly in 2015 and continued to rise in 2016, 2017 and in the first two quarters of 2018, with 30-year Treasury notes decreasing in 2014, then rising in 2015, stable in 2016, decreasing in 2017 and rising in the first two quarters of 2018.

 

 35 

 

 

SUMMARY

 

In summary, population increased minimally in Milwaukee County from 2000 to 2010, and the number of households also increased minimally. Milwaukee Countys increase in population and households was lower than that of Racine County and lower than that of Waukesha County from 2000 to 2010. The 2010 per capita income and median household income levels in Milwaukee and Racine Counties were below those of Waukesha County, and Waukesha County were above state and national levels. Milwaukee and Racine Countiesunemployment rates have been above national rates, while Waukesha Countys unemployment rates have been lower than national rates. According to the 2010 Census, Milwaukee Countys median housing value was below both the state and the national median housing value, and the median housing values in Waukesha County and Racine County were above the state median.

 

The Bank holds deposits of approximately 6.5 percent of all thrift deposits in the three-county market area as of June 30, 2017, representing a minimal 0.4 percent share of the total deposit base of approximately $68.4 billion.

 

 36 

 

 

III.COMPARABLE GROUP SELECTION

 

Introduction

 

Integral to the valuation of the Corporation is the selection of an appropriate group of publicly traded thrift institutions, hereinafter referred to as the "comparable group". This section identifies the comparable group and describes each parameter used in the selection of each institution in the group, resulting in a comparable group based on such specific and detailed parameters, current financials and recent trading prices. The various characteristics of the selected comparable group provide the primary basis for making the necessary adjustments to the Corporation's pro forma value relative to the comparable group. There is also a recognition and consideration of financial comparisons with all publicly traded, FDIC-insured thrifts in the United States and all publicly traded, FDIC-insured thrifts in the Midwest region and in Wisconsin.

 

Exhibits 30 and 31 present Share Data and Pricing Ratios and Key Financial Data and Ratios, respectively, both individually and in aggregate, for the universe of 122 publicly traded, FDIC-insured thrifts in the United States ("all thrifts"), excluding mutual holding companies, used in the selection of the comparable group and other financial comparisons. Exhibits 30 and 31 also subclassify all thrifts by region, including the 39 publicly traded Midwest thrifts ("Midwest thrifts") and the 4 publicly traded thrifts in Wisconsin "Wisconsin thrifts"), and by trading exchange. Exhibits 32 and 33 present Share Data and Pricing Ratios and Key Financial Data and Ratios for the universe of 23 publicly traded mutual holding companies.

 

The selection of the comparable group was based on the establishment of both general and specific parameters using financial, operating and asset quality characteristics of the Corporation as determinants for defining those parameters. The determination of parameters was also based on the uniqueness of each parameter as a normal indicator of a thrift institution's operating philosophy and perspective. The parameters established and defined are considered to be both reasonable and reflective of the Corporations basic operation.

 

 37 

 

 

Introduction (cont.)

 

The general parameter requirements for the selection of the peer group candidates included a maximum asset size limit of $950 million, a trading exchange requirement that each candidate be traded on one of the two major stock exchanges, the New York Stock Exchange or the NASDAQ, a geographic parameter that eliminates potential candidates located in the Southwest and West, a merger and acquisition parameter that eliminates any potential candidate that is involved as a seller in a merger and acquisition transaction, and a recent conversion parameter that eliminates any institution that has not been converted from mutual to stock for at least four quarters or prior to June 30, 2018. Due to the general parameter requirement related to trading on NASDAQ or one of the other two major stock exchanges, the size of the peer group institutions results in larger institutions.

 

Inasmuch as the comparable group must consist of at least ten institutions, the parameters relating to asset size and geographic location have been expanded as necessary in order to fulfill this requirement.

 

Due to lack of comparability, there are no mutual holding companies included as potential comparable group candidates.

 

GENERAL PARAMETERS

 

Merger/Acquisition

 

The comparable group will not include any institution that is a proposed seller in a merger or acquisition as of August 17, 2018, due to the price impact of such a pending transaction. There are no pending merger/acquisition transactions involving thrift institutions that were potential comparable group candidates in the Corporations city, county or market area as indicated in Exhibit 35.

 

 38 

 

 

Trading Exchange

 

It is necessary that each institution in the comparable group be listed on one of the three major stock exchanges, the New York Stock Exchange or the National Association of Securities Dealers Automated Quotation System (NASDAQ). Such a listing indicates that an institutions stock has demonstrated trading activity and is responsive to normal market conditions, which are requirements for listing. Of the 122 publicly traded, FDIC-insured savings institutions, excluding the 23 mutual holding companies, 3 are traded on the New York Stock Exchange and 64 are traded on NASDAQ. There were an additional 20 traded over the counter and 35 institutions are listed in the Pink Sheets, but they were not considered for the comparable group selection.

 

IPO Date

 

Another general parameter for the selection of the comparable group is the initial public offering ("IPO") date, which must be at least four quarterly periods prior to June 30, 2018, in order to insure at least four consecutive quarters of reported data as a publicly traded institution. The resulting parameter is a required IPO of March 31, 2017, or earlier.

 

 39 

 

 

Geographic Location

 

The geographic location of an institution is a key parameter due to the impact of various economic and thrift industry conditions on the performance and trading prices of thrift institution stocks. Although geographic location and asset size are the two parameters that have been developed incrementally to fulfill the comparable group requirements, the geographic location parameter has nevertheless eliminated regions of the United States distant to the Corporation, including the New England, Southwest and West regions.

 

The geographic location parameter consists of the Midwest, North Central, Southeast and Northeast regions for a total of fifteen states. To extend the geographic parameter beyond those states could result in the selection of similar thrift institutions with regard to financial conditions and operating characteristics, but with different pricing ratios due to their geographic regions. The result could then be an unrepresentative comparable group with regard to price relative to the parameters and, therefore, an inaccurate value.

 

Asset Size

 

Asset size was another key parameter used in the selection of the comparable group. The total asset size for any potential comparable group institution was $950 million or less, due to the general similarity of asset mix and operating strategies of institutions within this asset range, compared to the Corporation, with assets of approximately $313 million. Such an asset size parameter was necessary to obtain an appropriate comparable group of at least ten institutions.

 

In connection with asset size, we did not consider the number of offices or branches in selecting or eliminating candidates, since that characteristic is directly related to operating expenses, which are recognized as an operating performance parameter.

 

 40 

 

 

Mutual Holding Companies

 

The comparable group does not include any mutual holding companies. The percentage of public ownership of individual mutual holding companies indicates a wide range from minimal to 49.0 percent, the largest permissible percentage, causing them to demonstrate certain varying individual characteristics different among themselves and from conventional, publicly-traded companies. A further reason for the elimination of mutual holding companies as potential comparable group candidates relates to the presence of a mid-tier, publicly traded holding company in some, but not all, mutual holding company structures. The presence of mid-tier holding companies can also result in inconsistent and unreliable comparisons among the relatively small universe of 23 publicly traded mutual holding companies as well between those 23 entities and the larger universe of conventional, publicly traded thrift institutions. As a result of the foregoing and other factors, mutual holding companies typically demonstrate higher pricing ratios that relate to their minority ownership structure and are inconsistent in their derivation with those calculated for conventionally structured, publicly traded institutions. In our opinion, it is appropriate to limit individual comparisons to institutions that are 100 percent publicly owned.

 

 41 

 

 

SUMMARY

 

Exhibits 36 and 37 show the 30 institutions considered as comparable group candidates after applying the general financial, geographic and merger/acquisition parameters, with the outlined institutions being those ultimately selected for the comparable group using the balance sheet, performance and asset quality parameters established in this section along with being publicly traded on one of the three major exchanges..

 

BALANCE SHEET PARAMETERS

 

Introduction

 

The balance sheet parameters focused on seven balance sheet ratios as determinants for selecting a comparable group, as presented in Exhibit 36. The balance sheet ratios consist of the following:

 

1.Cash and investments to assets
2.Mortgage-backed securities to assets
3.One- to four-family loans to assets
4.Total net loans to assets
5.Total net loans and mortgage-backed securities to assets
6.Borrowed funds to assets
7.Equity to assets

 

The parameters enable the identification and elimination of thrift institutions that are distinctly and functionally different from the Corporation with regard to asset mix. The balance sheet parameters also distinguish institutions with a significantly different capital position from the Corporation. The ratio of deposits to assets was not used as a parameter as it is directly related to and affected by an institution's equity and borrowed funds ratios, which are separate parameters.

 

 42 

 

 

Cash and Investments to Assets

 

The Banks ratio of cash and investments to assets, excluding mortgage-backed securities, was 8.31 percent at June 30, 2018, and reflects the Corporations modestly lower share of investments, lower than the national and regional averages of 11.7 percent and 13.8 percent, respectively. The Bank's investments have consisted of municipal securities, commercial paper and interest-bearing deposits. For its recent two fiscal years ended September 30, 2016, and September 30, 2017, the Corporations average ratio of cash and investments to assets was a higher 8.96 percent, ranging from a high of 9.35 percent in 2016 to a low of 8.31 percent at June 30, 2018.

 

The parameter range for cash and investments is has been defined as 20.0 percent or less of assets, with a midpoint of 10.0 percent.

 

Mortgage-Backed Securities to Assets

 

At June 30, 2018, the Corporations ratio of mortgage-backed securities to assets was 0.37 percent, moderately lower than the national average of 7.1 percent and the regional average of 7.6 percent for publicly traded thrifts.

 

Inasmuch as many institutions purchase mortgage-backed securities as an alternative to both lending, relative to cyclical loan demand and prevailing interest rates, and other investment vehicles, this parameter is also fairly broad at 16.0 percent or less of assets and a midpoint of 8.0 percent.

 

One- to Four-Family Loans to Assets

 

The Corporations lending activity is focused on the origination of residential mortgage loans secured by one- to four-family dwellings. One- to four-family loans, including construction loans and excluding home equity loans, represented 47.3 percent of the Corporation's assets at June 30, 2018, which is higher than its ratio of 46.4 percent at September 30, 2017, and similar to its ratio of 45.1 percent at September 30, 2016. The parameter for this characteristic is 72.00 percent of assets or less in one- to four-family loans with a midpoint of 36.00 percent.

 

 43 

 

 

Total Net Loans to Assets

 

At June 30, 2018, the Corporation had an 86.28 percent ratio of total net loans to assets and a lower two fiscal year average of 86.43 percent, compared to the national average of 74.0 percent and the regional average of 70.1 percent for publicly traded thrifts. The Corporation's ratio of total net loans to assets changed from 86.40 percent of total assets at September 30, 2016, to 86.45 percent at September 30, 2017, to 86.28 percent at June 30, 2018.

 

The parameter for the selection of the comparable group is from 60.0 percent to 90.0 percent with a midpoint of 75.0 percent. The lower end of the parameter range relates to the fact that, as the referenced national and regional averages indicate, many institutions hold greater volumes of investment securities and/or mortgage-backed securities as cyclical alternatives to lending, but may otherwise be similar to the Corporation. 

 

Total Net Loans and Mortgage-Backed Securities to Assets

 

As discussed previously, the Corporations shares of mortgage-backed securities to assets and total net loans to assets were 0.37 percent and 86.28 percent, respectively, for a combined share of 86.65 percent. Recognizing the industry and regional ratios of 81.1 percent and 77.7 percent, respectively, the parameter range for the comparable group in this category is 75.0 percent to 92.0 percent, with a midpoint of 83.5 percent.

 

 44 

 

 

Borrowed Funds to Assets

 

The Corporation had borrowed funds of $46.0 million or 14.68 percent of assets at June 30, 2018, which is higher than current industry averages.

 

The use of borrowed funds by some institutions indicates an alternative to retail deposits and may provide a source of longer term funds. The federal insurance premium on deposits has also increased the attractiveness of borrowed funds. The institutional demand for borrowed funds has increased recently, due to the rise in rates paid on deposits. Additionally, many thrifts are now aggressively seeking deposits, since quality lending opportunities have increased in the current economic environment.

 

The parameter range of borrowed funds to assets is 22.0 percent or less with a midpoint of 11.0 percent.

 

Equity to Assets

 

The Corporations equity to assets ratio was 4.50 percent at June 30, 2018, 4.67 percent at September 30, 2017, and 4.39 percent at September 30, 2016, averaging 4.53 percent for the two fiscal years ended September 30, 2017. The Banks equity decreased in 2016, increased in 2017, and then decreased in the nine months ended June 30, 2018. After conversion, based on the midpoint value of $23.0 million, with a 45.0 percent minority offering, with 90.0 percent of the net proceeds of the public offering going to the Bank, its equity is projected to increase to 7.0 percent of assets, with the Corporation at 7.2 percent of assets.

 

 45 

 

 

Equity to Assets (cont.)

 

Based on those equity ratios, we have defined the equity ratio parameter to be 5.0 percent to 22.0 percent with a midpoint ratio of 13.5 percent.

 

 46 

 

 

PERFORMANCE PARAMETERS

 

Introduction

 

Exhibit 37 presents five parameters identified as key indicators of the Corporations earnings performance and the basis for such performance both historically and the nine months ended June 30, 2018. The primary performance indicator is the Corporation's core return on average assets (ROAA). The second performance indicator is the Corporation's core return on average equity (ROAE). To measure the Corporation's ability to generate net interest income, we have used net interest margin. The supplemental source of income for the Corporation is noninterest income, and the parameter used to measure this factor is the ratio of noninterest income to average assets. The final performance indicator is the Corporation's ratio of operating expenses or noninterest expenses to average assets, a key factor in distinguishing different types of operations, particularly institutions that are aggressive in secondary market activities, which often results in much higher operating costs and overhead ratios.

 

Return on Average Assets

 

The key performance parameter is core ROAA. For the twelve months ended June 30, 2018, the Corporations core ROAA was (0.04) percent based on a core income of $133,000, as detailed in Item I of this Report. The net ROAA for the twelve months ended June 30, 2018, was 0.12 percent. The Corporation's ROAAs in its most recent three fiscal years ended September 30, 2017, were (0.20) percent, (0.56) percent, and (0.07) percent, respectively, with a three fiscal year average ROAA of (0.28) percent.

 

Considering the historical and current earnings performance of the Corporation, the range for the ROAA parameter based on core income has been defined as 1.00 percent or less with a midpoint of 0.50 percent.

 

 47 

 

 

Return on Average Equity

 

The ROAE has been used as a secondary parameter to eliminate any institutions with an unusually high or low ROAE that is inconsistent with the Corporation's position. This parameter does not provide as much meaning for a newly converted thrift institution as it does for established stock institutions, due to the unseasoned nature of the capital structure of the newly converted thrift and the inability to accurately reflect a mature ROAE for the newly converted thrift relative to other stock institutions.

 

The Corporations core ROAE for the twelve months ended June 30, 2018, was (0.98) percent based on its core income and 1.60 percent in the fiscal year ended September 30, 2017.

 

The parameter range for ROAE for the comparable group, based on core income, is 10.00 percent or less with a midpoint of 5.00 percent.

 

Net Interest Margin

 

The Corporation had a net interest margin of 3.49 percent for the twelve months ended June 30, 2018, representing net interest income as a percentage of average interest-earning assets. The Corporation's net interest margin levels in its three fiscal years of 2015 through 2017 were 4.02 percent, 3.80 percent, and 3.79 percent, respectively, averaging 3.87 percent.

 

The parameter range for the selection of the comparable group is from a low of 2.70 percent to a high of 4.20 percent with a midpoint of 3.45 percent.

 

 48 

 

 

Operating Expenses to Assets

 

For the twelve months ended June 30, 2018, the Corporation had a 4.24 percent ratio of operating expense to average assets. In its three fiscal years ended September 30, 2017, the Corporations expense ratio averaged 4.58 percent, from a low of 4.35 percent in fiscal year 2017 to a high of 4.85 percent in fiscal year 2015.

 

The operating expense to assets parameter for the selection of the comparable group is from a low of 1.50 percent to a high of 4.50 percent with a midpoint of 3.00 percent.

 

Noninterest Income to Assets

 

Compared to publicly traded thrifts, the Corporation has experienced a lower level of noninterest income as a source of additional income. The Corporations ratio of noninterest income to average assets was 0.84 percent for the twelve months ended June 30, 2018. For its three years ended September 30, 2015 through 2017 the Corporations ratio of noninterest income to average assets was 0.97 percent, 1.07 percent and 0.85 percent, respectively, for an average of 0.96 percent.

 

The range for this parameter for the selection of the comparable group is 1.50 percent of average assets or less, with a midpoint of 0.75 percent.

 

ASSET QUALITY PARAMETERS

 

Introduction

 

The final set of financial parameters used in the selection of the comparable group are asset quality parameters, also shown in Exhibit 37. The purpose of these parameters is to insure that any thrift institution in the comparable group has an asset quality position similar to that of the Corporation. The three defined asset quality parameters are the ratios of nonperforming assets to total assets, repossessed assets to total assets and loan loss reserves to total assets at the end of the most recent period.

 

 49 

 

 

Nonperforming Assets to Total Assets

 

The Corporations ratio of nonperforming assets to assets was 1.72 percent at June 30, 2018, which was higher than the national average of 0.65 percent for publicly traded thrifts and the average of 0.67 percent for Midwest thrifts. The Corporation’s ratio of nonperforming assets to total assets averaged 1.23 percent for its most recent three fiscal years ended September 30, 2017, from a high of 2.56 percent in 2016, to a low of 0.57 percent in 2015 and 2017.

 

The comparable group parameter for nonperforming assets is 1.80 percent or less of total assets, with a midpoint of 0.90 percent.

 

Repossessed Assets to Assets

 

The Corporation had $3.9 million in repossessed assets at June 30, 2018, representing a ratio to total assets of 1.26 percent, following ratios of repossessed assets to total assets of 1.42 percent at September 30, 2017, and 0.66 percent at September 30, 2016. National and regional averages were 0.12 percent and 0.13 percent, respectively, for publicly traded thrift institutions.

 

The range for the repossessed assets to total assets parameter is 1.30 percent of assets or less with a midpoint of 0.65 percent.

 

 50 

 

 

Loans Loss Reserves to Assets

 

The Corporation had an allowance for loan losses of $1,324,000, representing a loan loss allowance to total assets ratio of 0.42 percent at June 30, 2018, which was lower than its 0.62 percent ratio at September 30, 2017, and lower than its 1.47 percent ratio at September 30, 2016.

 

The loan loss allowance to assets parameter range used for the selection of the comparable group required a minimum ratio of 0.40 percent of assets.

 

THE COMPARABLE GROUP

 

With the application of the parameters previously identified and applied, the final comparable group represents ten institutions identified in Exhibits 37, 38 and 39. The comparable group institutions range in size from $132.2 million to $944.3 million with an average asset size of $533.0 million and have an average of 6.0 offices per institution. Two of the comparable group institutions are in Maryland, two are in New York, and one each in Illinois, Nebraska, Pennsylvania, Louisiana, Minnesota and Ohio, and all ten were traded on NASDAQ.

 

The comparable group institutions as a unit have a ratio of equity to assets of 12.38 percent, which is 1.7 percent lower than all publicly traded thrift institutions in the United States; and for the most recent four quarters indicated a core return on average assets of 0.58 percent, lower than all publicly traded thrifts at 0.87 percent and publicly traded Wisconsin thrifts at 1.06 percent.

 

 51 

 

 

IV.ANALYSIS OF FINANCIAL PERFORMANCE

 

This section reviews and compares the financial performance of the Corporation to all publicly traded thrifts, to publicly traded thrifts in the Midwest region and to Wisconsin thrifts, as well as to the ten institutions constituting the Corporations comparable group, as selected and described in the previous section. The comparative analysis focuses on financial condition, earning performance and pertinent ratios as presented in Exhibits 40 through 45.

 

As presented in Exhibits 41 and 42, at June 30, 2018, the Corporations total equity of 4.50 percent of assets was lower than the comparable group at 12.38 percent, all thrifts at 12.60 percent, Midwest thrifts at 12.58 percent and Wisconsin thrifts at 15.26 percent. The Corporation had an 86.28 percent share of net loans in its asset mix, higher than the comparable group at 77.70 percent, higher than all thrifts at 74.00 percent, Wisconsin thrifts at 75.58 percent and Midwest thrifts at 70.13 percent. The Corporations higher share of net loans is primarily the result of its lower 8.31 percent share of cash and investments and lower 0.37 percent share of mortgage-backed securities. The comparable group had a higher 9.05 percent share of cash and investments and a higher 6.44 percent share of mortgage-backed securities. All thrifts had 7.13 percent of assets in mortgage-backed securities and 11.66 percent in cash and investments. The Corporations 78,00 percent share of deposits was similar to the comparable group, all thrifts and Midwest thrifts and higher than Wisconsin thrifts, reflecting the Corporation's higher share of borrowed funds of 14.68 percent and lower share of equity of 4.50 percent. As ratios to assets, the comparable group had deposits of 79.71 percent and borrowings of 7.92 percent. All thrifts averaged a 77.83 percent share of deposits and 9.27 percent of borrowed funds, while Midwest thrifts had a 79.03 percent share of deposits and an 8.05 percent share of borrowed funds. Wisconsin thrifts averaged a 74.37 percent share of deposits and a higher 10.67 percent share of borrowed funds. The Corporation had no goodwill, compared to 0.55 percent for the comparable group, 0.60 percent for all thrifts, 0.28 percent for Midwest thrifts and 0.02 percent for Wisconsin thrifts.

 

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Analysis of Financial Performance (cont.)

 

Operating performance indicators are summarized in Exhibits 43, 44 and 45 and provide a synopsis of key sources of income and key expense items for the Corporation in comparison to the comparable group, all thrifts, and regional thrifts for the trailing four quarters.

 

As shown in Exhibit 45, for the twelve months ended June 30, 2018, the Corporation had a yield on average interest-earning assets lower than the comparable group and similar to all thrifts, higher than Midwest thrifts and similar to Wisconsin thrifts. The Corporation's yield on interest-earning assets was 4.03 percent compared to the comparable group at 4.13 percent, all thrifts at 4.07 percent, Midwest thrifts at 3.75 percent and Wisconsin thrifts at 4.03 percent.

 

The Corporation's cost of funds for the twelve months ended June 30, 2018, was lower than the comparable group, Midwest thrifts and all thrifts and lower than Wisconsin thrifts. The Corporation had an average cost of interest-bearing liabilities of 0.59 percent compared to 0.92 percent for the comparable group, 0.86 percent for all thrifts, 0.81 percent for Midwest thrifts and 0.90 percent for Wisconsin thrifts. The Corporation's yield on interest-earning assets and interest cost resulted in a net interest spread of 3.44 percent, which was higher than the comparable group at 3.21 percent, higher than all thrifts at 3.22 percent, higher than Midwest thrifts at 2.98 percent and similar to Wisconsin thrifts at 3.41 percent. The Corporation generated a net interest margin of 3.49 percent for the twelve months ended June 30, 2018, based on its ratio of net interest income to average interest-earning assets, which was higher than the comparable group ratio of 3.36 percent. All thrifts averaged a lower 3.37 percent net interest margin for the trailing four quarters, with Midwest thrifts at 3.09 percent and Wisconsin thrifts at a lower 3.30 percent.

 

The Corporations major source of earnings is interest income, as indicated by the operations ratios presented in Exhibit 44. The Corporation had $425,000 in provision for loan losses during the twelve months ended June 30, 2018, representing 0.14 percent of average assets. The average provision for loan losses for the comparable group was 0.16 percent, with all thrifts at 0.08 percent, Midwest thrifts at 0.06 percent and Wisconsin thrifts at (0.12) percent.

 

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Analysis of Financial Performance (cont.)

 

The Corporation's total noninterest income was $2,595,000 or 0.84 percent of average assets for the twelve months ended June 30, 2018. Such a ratio of noninterest income to average assets was lower than the comparable group at 0.86 percent, and similar to all thrifts at 0.84 percent and Midwest thrifts at 0.87 percent but higher than Wisconsin thrifts at 0.57 percent. For the twelve months ended June 30, 2018, the Corporations operating expense ratio was 4.24 percent of average assets, higher than the comparable group at 2.97 percent, all thrifts at 2.81 percent, Midwest thrifts at 3.10 percent, and Wisconsin thrifts at 3.66 percent.

 

The overall impact of the Corporations income and expense ratios is reflected in its net income and return on assets. For the twelve months ended June 30, 2018, the Corporation had a net ROAA of (0.12) percent and core ROAA of (0.04) percent. For its most recent four quarters, the comparable group had a higher net ROAA of 0.50 percent and a core ROAA of 0.58 percent. All publicly traded thrifts averaged a higher net ROAA of 0.84 percent and 0.87 percent core ROAA, with Midwest thrifts a 0.78 percent net ROAA and a 1.03 percent core ROAA. The twelve month net ROAA for the 4 Wisconsin thrifts was 0.96 percent and their core ROAA was 1.06 percent.

 

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V.MARKET VALUE ADJUSTMENTS

 

This is a conclusive section where adjustments are made to determine the pro forma market value or appraised value of the Corporation based on a comparison of Equitable with the comparable group. These adjustments will take into consideration such key items as earnings performance, primary market area, financial condition, asset and deposit growth, dividend payments, subscription interest, liquidity of the stock to be issued, management, and market conditions or marketing of the issue. It must be noted that all of the institutions in the comparable group have their differences among themselves and relative to the Bank, and, as a result, such adjustments become necessary.

 

EARNINGS PERFORMANCE

 

In analyzing earnings performance, consideration was given to net interest income, the amount and volatility of interest income and interest expense relative to changes in market area conditions and to changes in overall interest rates, the quality of assets as it relates to the presence of problem assets which may result in adjustments to earnings due to provisions for loan losses, the balance of current and historical nonperforming assets and real estate owned, the balance of valuation allowances to support any problem assets or nonperforming assets, the amount and volatility of noninterest income, and the amount and ratio of noninterest expenses. The earnings performance analysis was based on the Banks respective net and core earnings for the twelve months ended June 30, 2018, with comparisons to the core earnings of the comparable group, all thrifts and other geographical subdivisions.

 

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Earnings Performance (cont.)

 

As discussed earlier, the Bank has experienced increases in its assets and loans in two of the past four fiscal years and increases in the nine months ended June 30, 2018, with deposits indicating growth in only one of these periods. The Bank has experienced negative earnings in four of the past five years with a loss in the year ended September 30, 2017, and is focused on reducing operating expenses, monitoring and reducing its balances of real estate owned and nonperforming assets; monitoring and strengthening its ratio of interest sensitive assets relative to interest sensitive liabilities, thereby maintaining its overall interest rate risk; and strengthening its net interest margin. Historically, the Bank has been characterized with a slightly higher yield on earning assets but a lower cost of funds, resulting in a slightly higher net interest margin, which has been above industry averages, and slightly above its comparable group, with the trend experiencing a minimal decrease over the past two years and its 3.49 percent net interest margin for the twelve months ended June 30, 2018, was higher than the industry average of 3.37 percent and slightly higher than the comparable group average of 3.46 percent. During its past two fiscal years ended September 30, 2017, Equitables ratio of interest expense to interest-bearing liabilities has increased slightly from 0.45 percent in 2016 to 0.48 percent in 2017, and then to 0.59 percent in the twelve months ended June 30, 2018. The Banks ratio was lower than the average of 0.86 percent for the comparable group and lower than the average of 0.86 percent for all thrifts. Following the conversion, the Bank will strive to control its operating expenses, strive to increase its net interest margin, increase its noninterest income, gradually increase its net income, increase its return on assets, continue to reduce its balance of nonperforming assets and real estate owned, and closely monitor its interest rate risk.

 

From September 30, 2014, to September 30, 2017, three of the six categories of loans experienced increases in their balances, with multi-family loans increasing the most in dollars. Multi-family loans increased by $26.0 million or 57.5 percent, from September 30, 2014, to September 30, 2017. One- to four-family loans increased by $7.8 million or 5.6 percent from September 30, 2014, to September 30, 2017, and commercial loans increased $1.0 million or 98.5 percent. All other loan categories experienced decreases in their balances. Overall, the Banks lending activities resulted in a total loan increase of $3.7 million or 1.4 percent and a net loan increase of $5.8 million or 2.3 percent from September 30, 2014, to September 30, 2017. In the nine months ended June 30, 2018, loans increased $1.4 million or 0.5 percent.

 

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Earnings Performance (cont.)

 

The impact of Equitable’s primary lending efforts has been to generate a yield on average interest-earning assets of 4.03 percent for the twelve months ended June 30, 2018, compared to a higher 4.13 percent for the comparable group, 4.07 percent for all thrifts and a similar 4.03 percent for Wisconsin thrifts. The Banks ratio of interest income to average assets was 3.80 percent for the twelve months ended June 30, 2018, similar to the comparable group at 3.79 percent, all thrifts at 3.74 percent and lower than Wisconsin thrifts at 4.01 percent.

 

Equitables 0.59 percent cost of interest-bearing liabilities for the twelve months ended June 30, 2018, was modestly lower than the comparable group at 0.92 percent, lower than all thrifts at 0.86 percent, lower than Midwest thrifts at 0.81 percent and lower than Wisconsin thrifts at 0.90 percent. The Bank's resulting net interest spread of 3.44 percent for the twelve months ended June 30, 2018, was higher than the comparable group at 3.21 percent, higher than all thrifts at 3.22 percent, higher than Midwest thrifts at 2.98 percent and similar to Wisconsin thrifts at 3.41 percent. The Bank's net interest margin of 3.49 percent, based on average interest-earning assets for the twelve months ended June 30, 2018, was higher than the comparable group at 3.36 percent, higher than all thrifts at 3.37 percent, higher than Midwest thrifts at 3.09 percent and higher than Wisconsin thrifts at 3.30 percent.

 

The Bank's ratio of noninterest income to average assets was 0.84 percent for the twelve months ended June 30, 2018, which was slightly lower than the comparable group at 0.86 percent, identical to all thrifts at 0.84 percent, lower than Midwest thrifts at 0.87 percent and higher than Wisconsin thrifts at 0.57 percent.

 

The Bank's operating expenses were higher than the comparable group, all thrifts, Midwest thrifts, and Wisconsin thrifts. For the twelve months ended June 30, 2018, Equitable had an operating expenses to assets ratio of 4.24 percent compared to 2.97 percent for the comparable group, 2.81 percent for all thrifts, 3.10 percent for Midwest thrifts and 3.66 percent for Wisconsin thrifts. Equitable had a higher 102.9 percent efficiency ratio for the twelve months ended June 30, 2018, compared to the comparable group with an efficiency ratio of 72.0 percent. The efficiency ratio for all publicly traded thrifts was 60.7 percent for the most recent twelve months.

 

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Earnings Performance (cont.)

 

For the twelve months ended June 30, 2018, Equitable generated a lower ratio of noninterest income, a higher ratio of noninterest expenses and a modestly higher net interest margin relative to its comparable group. The Bank had a 0.14 percent provision for loan losses during the twelve months ended June 30, 2018, compared to the comparable group at 0.16 percent of assets, all thrifts at 0.08 percent and Midwest thrifts at 0.06 percent. The Banks allowance for loan losses to total loans of 0.49 percent was lower than the comparable group and lower than all thrifts. The Banks 24.51 percent ratio of reserves to nonperforming assets was lower than the comparable group at 110.77 percent, lower than all thrifts at 124.74 percent and lower than Midwest thrifts at 119.42 percent.

 

As a result of its operations, the Bank's net and core income for the twelve months ended June 30, 2018, were lower than the comparable group. Based on a modest loss, the Bank had a return on average assets of (0.12) percent for the twelve months ended June 30, 2018, and a return on average assets of 0.07 percent and (0.56) percent in 2017 and 2016, respectively. The Banks core return on average assets was (0.04) percent for the twelve months ended June 30, 2018, as detailed in Exhibit 7. For their most recent four quarters, the comparable group had a moderately higher net ROAA of 0.50 percent and a higher core ROAA of 0.58 percent, while all thrifts indicated a higher net ROAA and higher core ROAA of 0.84 percent and 0.87 percent, respectively. Midwest thrifts indicated a net ROAA of 0.78 percent and a core ROAA of 1.03 percent.

 

Following its conversion, Equitable’s earnings will continue to be dependent on a combination of the overall trends in interest rates, the consistency, reliability and variation of its noninterest income, overhead expenses and its asset quality and its future needs for provisions for loan losses. Earnings are projected to represent a 0.31 percent ROAA in 2019 followed by earnings based on an ROAA of 0.49 percent in 2020 and 0.58 percent in 2021. Earnings will be enhanced due to the Bank’s $6.6 million in loss carryforward that would offset future federal income taxes.

 

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Earnings Performance (cont.)

 

In recognition of the foregoing earnings related factors, considering Equitable’s historical and current performance measures, as well as Business Plan projections, a moderate downward adjustment has been made to the Corporation’s pro forma market value for earnings performance.

 

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MARKET AREA

 

Equitable's market area is focused on Milwaukee, Racine and Waukesha Counties, Wisconsin. Population increased minimally in Milwaukee County from 2000 to 2010, and the number of households also increased minimally. Racine Countys increase in population and households was higher than that of Milwaukee County but lower than that of Waukesha County from 2000 to 2010. The 2010 per capita income and median household income levels in Waukesha County were above state and national levels, and the per capita and median household income levels in Milwaukee and Racine Counties were below those of Waukesha County. Also, Waukesha Countys unemployment rates have been lower than national rates, and Milwaukee and Racine Countiesunemployment rates have been above national rates. According to the 2010 Census, median housing values in Waukesha County and Racine County were above the state median, but Milwaukee Countys median housing value was below both the state and the national median housing value.

 

The Bank holds deposits of approximately 6.5 percent of all thrift deposits in the three-county market area as of June 30, 2017, representing a minimal 0.4 percent share of the total deposit base of approximately $68.4 billion.

 

In recognition of the foregoing factors, we believe that a modest downward adjustment is warranted for the Banks market area.

 

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FINANCIAL CONDITION

 

The financial condition of Equitable is discussed in Section I and shown in Exhibits 1, 2, 5, and 12 through 21, and is compared to the comparable group in Exhibits 40, 41, and 42. The Bank's ratio of total equity to total assets was 4.50 percent at June 30, 2018, which was lower than the comparable group at 12.38 percent, all thrifts at 12.60 percent and Midwest thrifts at 12.58 percent. Based on the minority offering completed at the midpoint of the valuation range, the Corporation's pro forma equity to assets ratio will increase to 11.39 percent and the Bank's pro forma equity to assets ratio will increase to 6.95 percent at the midpoint and 7.84 percent at the super max.

 

The Bank's mix of assets and liabilities indicates both similarities to and variations from its comparable group. Equitable had a moderately higher 86.28 percent ratio of net loans to total assets at June 30, 2018, compared to the comparable group at 77.7 percent. All thrifts indicated a lower 74.0 percent, with Midwest thrifts at a lower 70.1 percent. The Bank's 8.31 percent share of cash and investments was lower than the comparable group at 9.05 percent, while all thrifts were at 11.66 percent and Midwest thrifts were at 13.78 percent. Equitables 0.37 percent ratio of mortgage-backed securities to total assets was lower than the comparable group at 6.44 percent and lower than all thrifts at 7.13 percent and lower than Midwest thrifts at 7.61 percent.

 

The Bank's 78.00 percent ratio of deposits to total assets was lower than the comparable group at 79.71 percent, higher than all thrifts at 77.83percent and lower than Midwest thrifts at 79.03 percent. Equitables lower ratio of deposits was due to its higher share of borrowed funds. Equitable had a lower equity to asset ratio of 4.50 percent, compared to the comparable group at 12.38 percent of total assets, with all thrifts at 12.60 percent and Midwest thrifts at 12.58 percent. Equitable had a higher share of borrowed funds to assets of 14.68 percent at June 30, 2018, higher than the comparable group at 7.92 percent and higher than all thrifts at 9.27 percent and Midwest thrifts at 8.05 percent.

 

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Financial Condition (cont.)

 

Equitable had no goodwill and had a higher share of repossessed real estate at June 30, 2018. The Bank had 1.26 percent of its assets in repossessed real estate at June 30, 2018. This compares to ratios of 0.55 percent for goodwill and intangible assets and 0.06 percent for real estate owned, for the comparable group. All thrifts had a goodwill and intangible assets ratio of 0.60 percent and a real estate owned ratio of 0.12 percent.

 

The financial condition of Equitable has been impacted by its higher balance of nonperforming assets of $5,401,000 or a higher 1.72 percent of total assets at June 30, 2018, compared to a lower 0.92 percent for the comparable group, 0.65 percent for all thrifts, 0.67 percent for Midwest thrifts and 0.27 percent for Wisconsin thrifts. The Bank's ratio of nonperforming assets to total assets was a higher 3.21 percent at September 30, 2016, and a higher 1.99 percent at September 30, 2017.

 

At June 30, 2018, Equitable had $1,324,000 of allowances for loan losses, which represented 0.42 percent of assets and 0.49 percent of total loans. The comparable group indicated higher allowance ratios, relative to assets and relative to loans, equal to 0.88 percent of assets and a higher 1.08 percent of total loans, while all thrifts had allowances relative to assets and loans that averaged a higher 0.77 percent of assets and a higher 1.01 percent of total loans. Also of major importance is an institution's ratio of allowances for loan losses to nonperforming assets, since a portion of nonperforming assets might eventually be charged off. Equitables $1,324,000 of allowances for loan losses represented a lower 24.51 percent of nonperforming assets at June 30, 2018, compared to the comparable group's 110.77 percent, with all thrifts at 124.74 percent, Midwest thrifts at a lower 119.42 percent and Wisconsin thrifts at a lower 138.83 percent. Equitables ratio of net charge-offs to average total loans was 0.36 percent for the twelve months ended June 30, 2018, compared to a higher 0.44 percent for the comparable group and lower 0.16 percent for all thrifts and 0.21 percent for Midwest thrifts.

 

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Financial Condition (cont.)

 

Equitable has a modest level of interest rate risk. The change in the Banks NEV level at June 30, 2018, reflecting the most current information available, based on a rise in interest rates of 200 basis points was a 14.2 percent decrease, representing a dollar decrease in equity value of $4,089,000. The Banks exposure increases to a 38.8 percent decrease in its NEV level under a 400 basis point rise in rates, representing a dollar decrease in equity of $11,162,000.

 

Compared to the comparable group, with particular attention to the Banks lower level of total equity and lower share of risk-based capital, higher level and share of nonperforming assets and asset and liability mix and lower share of allowance for loan loss to loans and lower share to nonperforming assets, we believe that a downward adjustment is warranted for Equitables current financial condition, due to the Banks lower share of total equity and risk-based capital, lower share of allowance to loans, lower share of allowance for loan losses to nonperforming assets and higher share of nonperforming assets.

 

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ASSET, LOAN AND DEPOSIT GROWTH

 

During its most recent two fiscal years, Equitable has been characterized by a modest changes in assets, loans and deposits. The Banks average annual asset change from September 30, 2015, to September 30, 2017, was a 1.8 percent increase. This rate compares to a 3.6 percent increase for the comparable group, a higher 3.7 percent for all thrifts, and a higher 3.4 percent for Midwest thrifts. The Banks modest change in assets higher than its increase in total net loans during the period of an average annual 2.5 percent with an average annual decrease in cash and investments of 3.6 percent. Equitables deposits indicate an average annual decrease of 0.8 percent from September 30, 2015, to September 30, 2017, compared to average growth rates of 3.4 percent for the comparable group, 2.5 percent for all thrifts and 2.7 percent for Midwest thrifts.

 

Equitables deposits indicated a decrease of 6.2 percent from September 30, 2016 to 2017. Annual deposit change was growth rates of 3.8 percent for the comparable group, 3.2 percent for all thrifts and 2.9 percent for Midwest thrifts. The Bank had $46.0 million in borrowed funds or 14.7 percent of assets at June 30, 2018, compared to the comparable group at 7.9 percent and had a lower $22.7 million in borrowed funds at September 30, 2017, or 7.4 percent of assets.

 

In spite of its minimal deposit decrease, historically, the Bank grew modestly in 2017, and considering the demographics, competition and deposit base trends in its market area, the Banks ability to increase its asset, loan and deposit bases in the future is significantly dependent on its capital position combined with its ability to increase its market share by competitively pricing its loan and deposit products, maintaining a high quality of service to its customers and strengthening its loan origination activity, all impacted by the Banks performance by the senior management team. Equitables primary market area county experienced minimal increases in population and households in Milwaukee County between 2000 and 2010, while the surrounding market area counties experienced a higher increase. The Banks primary market area county also indicated 2010 per capita income lower than Wisconsins and that of the United States, and the median household income level in Milwaukee County was also below the state and the national levels. In 2010, the median housing value in Milwaukee County was lower than that of Wisconsin and also above that of the United States, and the median rent level was also below both state and national levels.

 

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Asset, Loan and Deposit Growth (cont.)

 

The total deposit base in the three market area counties increased by 9.2 percent from June 30, 2016, to June 30, 2017; and during that period, the number of financial institution offices in the market area counties decreased by 39 offices. In June 30, 2016, and June 30, 2017, Equitables deposit market share in the three-county market area was 0.4 percent in both years.

 

Based on the foregoing factors, we have concluded that no adjustment to the Corporations pro forma value is warranted for asset, loan and deposit growth.

 

DIVIDEND PAYMENTS

 

Due to the mid-tier holding company structure of the Corporation, the Corporation will not have the normal structure to pay dividends directly to shareholders, unlike a standard conversion. The payment of cash dividends will not occur in the future based on the current presence of an MHC. Four of the ten institutions in the comparable group paid cash dividends during the most recent year for an average dividend yield of 0.77 percent and an average payout ratio of 15.42 percent. During that twelve month period, the average dividend yield for all thrifts was a higher 1.36 percent with a payout ratio of 21.90 percent.

 

In our opinion, a minimal downward adjustment to the pro forma market value of the Corporation is warranted related to dividend payments.

 

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SUBSCRIPTION INTEREST

 

In 2017 and year-to-date 2018, investors' interest in new issues has improved. Such interest is possibly related to the improved performance of financial institutions overall, which could be challenged in the future due to the compression of net interest margin. The selective and conservative reaction of IPO investors appears generally to be related to a number of analytical, economic and market-related factors, including the financial performance and condition of the converting thrift institution, the strength of the local economy, housing market conditions, general market conditions for financial institution stocks and stocks overall, aftermarket price trends and the expectation of increased merger/acquisition activity in the thrift industry and their higher pricing multiples.

 

Equitable will direct its offering initially to depositors and residents in its market area. The board of directors and officers anticipate purchasing $570,000 or 5.5 percent of the stock offered to the public based on the appraised midpoint valuation and the 45.0 percent minority offering. The Bank will form an ESOP, which plans to purchase 3.92 percent of the total shares sold in the conversion.

 

The Bank has secured the services of FIG Partners, LLC, to assist in the marketing and sale of the conversion stock.

 

Based on the size of the offering, recent banking conditions, current market conditions, historical local market interest, the terms of the offering, and recent subscription levels for conversions, we believe that no adjustment is warranted for the Banks anticipated subscription interest.

 

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LIQUIDITY/MARKETABILITY OF THE STOCK

 

The Corporation will offer its shares through a subscription and community offering with the assistance of FIG Partners, LLC. The stock of the Corporation will be traded on the OTC Pink Marketplace.

 

The Bank's total public offering is considerably smaller in size than the average market value of the comparable group. The comparable group has an average market value of $75.1 million for the stock outstanding compared to a midpoint public offering of $24.2 million for the Corporation, less the ESOP and the estimated 57,000 shares to be purchased by officers and directors, resulting in shares sold of 978,000 or $9.8 million. The Corporations public market capitalization will be approximately 13.8 percent of the size of the public market capitalization of the comparable group. Of the ten institutions in the comparable group, all trade on Nasdaq with those ten institutions indicating an average daily trading volume of over 7,100 shares during the last four quarters.

 

The comparable group has an average of 5,010,261 shares outstanding compared to 1,035,000 shares outstanding for the Corporation based on the midpoint valuation and the minority offering structure.

 

In addition, as a minority offering of an MHC, such structure reduces the marketability of the stock. As a group, MHCs indicate a lower ROAA and a lower ROAE compared to all publicly traded thrifts and a much lower median number of shares outstanding, recognizing the presence of two much larger publicly traded MHCs which inflates the average number of shares outstanding for MHCs. The average trading volume for MHCs is also lower as a group. Due to their control by the MHC, the positive influence of merger and acquisition activity in the overall market of publicly traded thrifts has not been paralleled for publicly traded MHCs.

 

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Liquidity/Marketability of the Stock (cont.)

 

Based on the higher average market capitalization, shares outstanding and daily trading volume of the comparable group relative to the Corporation, we have concluded that a downward adjustment to the Corporations pro forma market value is warranted relative to the liquidity of its stock.

 

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MANAGEMENT

 

Mr. John P. Matter has served as president and chief executive officer of The Equitable Bank since 2004 and has also served as vice chairman since 2005. He started his banking career in 1976 and joined The Equitable Bank in 1980. Mr. Matter is chairman of the Wisconsin Humane Society and is chair of the St. Joseph & Elmbrook Memorial Hospital Foundations. He has been involved in numerous civic organizations, including This Time Tomorrow Foundation Board, Brookfield Kiwanis Club, Sharon Lynne Wilson Center, Waukesha Community Foundation Board, Prevent Blindness Wisconsin, American Diabetes Association ad the Board of the Wisconsin Bankers Association. Mr. Matter’s positions as president and chief executive officer foster clear accountability, effective decision-making, a clear and direct channel of communication from senior management to the full board of directors, and alignment on corporate strategy.

 

Ms. Jennifer L. Provancher is the executive vice president, chief operating officer and chief financial officer of The Equitable bank, where she has worked since 1991. Ms. Provancher held various positions at other financial institutions in Milwaukee, beginning in 1983, and was also an audit senior at Ernst & Young, located in Milwaukee, Wisconsin. Ms. Provancher has served on the board of the Wisconsin Club, where she is currently a member of the finance committee. She is a long-time member and past president of the Milwaukee Chapter of the Financial Managers Society and served as treasurer of the Exchange Club of Milwaukee. Ms. Provancher’s experience in banking and as a certified public accountant provides the board with insights into risk assessment, financial matters, and internal control expertise.

 

Mr. William A. Behm joined The Equitable Bank in 2008 as a review credit analyst and was named chief credit officer in 2014. Mr. Behm has over sixteen years of banking experience and was previously a small business loan underwriter with U.S. Bank, Brookfield, Wisconsin, prior to joining The Equitable Bank. Mr. Behm is also a graduate of the Graduate School of Banking, University of Wisconsin-Madison.

 

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Management (cont.)

 

During its most recent fiscal year, Equitable has experienced a slight decrease in its net interest margin in contrast to the industry, experienced a decrease in its noninterest income and had a modest decrease in its noninterest expenses to assets. The Bank experienced minimal earnings in 2017 and then modest losses in the first two quarters of 2018. The Banks asset quality position experienced significant improvement from September 30, 2014, to September 30, 2017, with nonperforming assets decreasing from 7.16 percent in 2014 to 1.99 percent in 2017 and then decreasing to 1.72 percent at June 30, 2018. The Banks management team is confident that the Bank is positioned for continued loan growth and a return to modest profitability following its conversion and minority offering and the possibility of recovering its deferred tax assets, which totaled $6.6 million at June 30, 2018.

 

Overall, we believe the Bank to be professionally and knowledgeably managed, as are the comparable group institutions. It is our opinion that no adjustment to the pro forma market value of the Corporation is warranted for management.

 

MARKETING OF THE ISSUE

 

The necessity to build a new issue discount into the stock price of a new conversion continues to be a closely examined issue in recognition of uncertainty among investors as a result of the thrift industry's continued high level of competition, dependence on interest rate trends, volatility in the stock market, speculation on future changes, current proposed regulation related to the capital requirements of financial institutions and their restrictions on generating selected income.

 

We believe that a new issue discount applied to the price to book valuation approach is appropriate and necessary in this offering, recognizing the Banks weak and volatile earnings. In our opinion, such dependence on earnings and its volatility cause us to conclude that a modest new issue discount is warranted in the case of this offering. Consequently, at this time we have made a modest downward adjustment to the Corporation's pro forma market value related to a new issue discount.

 

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VI.VALUATION METHODS

 

Introduction

 

As indicated in Section III of this Appraisal, in order to moderate the differences among the ten comparable group companies, we will derive their pricing ratios on a fully converted basis by applying pro forma second stage conversion assumptions to their current financial structure. Our application to the Corporation of the market value adjustments relative to the comparable group determined in Section IV will be the basis for the pro forma market value of the Corporation on a fully converted basis, pursuant to regulatory guidelines.

 

Valuation Methods

 

Historically, the method most frequently used by this firm to determine the pro forma market value of common stock for thrift institutions has been the price to book value ratio method, due to the volatility of earnings in the thrift industry. As earnings in the thrift industry have stabilized and improved in 2016 and 2017, additional attention has been given to the price to core earnings method, particularly considering increases in stock prices during those years. During the past few years, however, as fluctuating earnings have continued and recently rising interest rates have had varying effects on the earnings of individual institutions, depending on the nature of their operations, the price to book value method has continued to be the valuation focus and more meaningful to the objective of discerning commonality and comparability among institutions. In our opinion, the price to book value method is the appropriate method upon which to place primary emphasis in determining the pro forma market value of the Corporation. Additional analytical and correlative attention will be given to the price to core earnings method and the price to assets method.

 

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Valuation Methods (cont.)

 

In applying each of the valuation methods, consideration was given to the adjustments to the Corporations pro forma market value discussed in Section V. Downward adjustments were made for the Banks earnings, financial condition, market area, dividends, stock liquidity, and for the marketing of the issue. No adjustments were made for subscription interest, management, and balance sheet growth.

 

Valuation Range

 

In addition to the pro forma market value, we have defined a valuation range recognizing the 45.0 percent public offering and the 55.0 percent interest in the Corporation to be retained by TEB MHC, the parent of the Corporation. The pro forma market value or appraised value will also be referred to as the "midpoint value," with the remaining points in the valuation range based on the number of shares offered to the public. The number of public shares at the minimum will be 15 percent less than at the midpoint; increasing at the maximum to 15 percent over the midpoint; and further increasing at the maximum, as adjusted, commonly referred to as the supermaximum, to 15 percent over the maximum.

 

Price to Book Value Method

 

In the valuation of thrift institutions, the price to book value method focuses on an institution's financial condition. Exhibit 46 shows the average and median price to book value ratios for the comparable group, which were 110.85 percent and 112.09 percent, respectively. The comparable group indicated a moderate range, from a low of 92.75 percent to a high of 136.74 percent. The comparable group had modestly higher average and median price to tangible book value ratios of 118.50 percent and 118.01 percent, respectively, with a range of 92.75 percent to 137.24 percent. Excluding the low and the high in the group, the comparable group's price to book value range narrowed moderately from a low of 94.34 percent to a high of 125.24; and the comparable groups price to tangible book value range narrowed modestly from a low of 112.06 percent to a high of 131.97 percent.

 

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Price to Book Value Method (cont.)

 

The Corporations book value was $14,102,000 and its tangible book value was an identical $14,102,000 at June 30, 2018. Considering the foregoing factors in conjunction with the adjustments made in Section V, we have determined a fully converted pro forma price to book value ratio of 67.42 percent and a corresponding fully converted price to tangible book value ratio of 67.42 percent at the midpoint. The fully converted price to book value ratio increases from 63.25 percent at the minimum to 74.16 percent at the maximum, as adjusted, while the fully converted price to tangible book value ratio increases from 63.25 percent at the minimum to 74.16 percent at the maximum, as adjusted.

 

The Corporation's fully converted pro forma price to book value ratio of 67.42 percent at the midpoint, as calculated using the prescribed formulary computation indicated in Exhibit 47, is influenced by the Banks capitalization and local markets, subscription interest in thrift stocks and overall market and economic conditions. Further, the Corporation's ratio of equity to assets after the completion of the minority public offering at the midpoint of the valuation range will be approximately 6.95 percent compared to 13.84 percent for the comparable group.

 

Price to Core Earnings Method

 

The foundation of the price to core earnings method is the determination of the core earnings base to be used, followed by the calculation of an appropriate price to core earnings multiple. The Corporations after tax core earnings for the twelve months ended June 30, 2018, was a loss of $133,000 (reference Exhibit 7) and its net earnings was a loss of $367,000 for that period. To opine the pro forma market value of the Corporation using the price to core earnings method, we applied the core earnings base of $(133,000).

 

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Price to Core Earnings Method (cont.)

 

In determining the fully converted price to core earnings multiple, we reviewed the ranges of the price to core earnings and price to net earnings multiples for the comparable group and all publicly-traded thrifts. As indicated in Exhibit 46, the average price to core earnings multiple for the comparable group was 29.49, while the median was a lower 24.31. The average price to net earnings multiple was 29.87, and the median multiple was 28.68. The range of the price to core earnings multiple for the comparable group was from a low of 14.56 to a high of 63.59. The range in the price to core earnings multiple for the comparable group, excluding the high and low ranges, was from a low multiple of 16.36 to a high of 43.90 times earnings for eight of the ten institutions in the group, indicating a moderate narrowing of the range.

 

Consideration was given to the adjustments to the Corporation's pro forma market value discussed in Section V combined with the Corporations negative actual earnings and minimal core earnings for the twelve months ended June 30, 2018. Due to the Banks negative core earnings, these price to core ratios were deemed not meaningful. In recognition of these factors, the price to core earnings could not be used as a meaningful approach.

 

Price to Assets Method

 

The final valuation method is the price to assets method. This method is not frequently used, since the calculation incorporates neither an institution's equity position nor its earnings performance. Additionally, the prescribed formulary computation of value using the pro forma price to net assets method does not recognize the runoff of deposits concurrently allocated to the purchase of conversion stock or incorporate any adjustment for intangible assets, returning a pro forma price to assets ratio below its true ratio following conversion.

 

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Price to Assets Method (cont.)

 

Exhibit 46 indicates that the average price to assets ratio of the comparable group was 13.63 percent, and the median was 13.20 percent. The range in the price to assets ratios for the comparable group varied from a low of 9.40 percent to a high of 19.29 percent. The range narrows moderately with the elimination of the two extremes in the group to a low of 9.70 percent and a high of 17.51 percent.

 

Consistent with the previously noted adjustments, it is our opinion that an appropriate price to assets ratio for the Corporation is 6.90 percent at the midpoint, which ranges from a low of 5.92 percent at the minimum to 8.94 percent at the maximum, as adjusted.

 

Valuation Analysis and Summary

 

Exhibits 47 through 51 present the pro forma valuation analysis and conclusions, pricing ratios, use of offering proceeds and a summary of the valuation premiums or discounts relative to the three valuation approaches based on the Corporation as fully converted.

 

Exhibit 51 presents the discounts or premiums of the Corporations fully converted pricing ratios relative to those of the comparable group. Based on the Corporations fully converted price to book value ratio and its equity of $14,102,000 at June 30, 2018, the Banks price to book value ratio of 67.42 percent represents a midpoint discount relative to the comparable group of 39.18 percent. The Corporations fully converted price to core earnings multiple was not meaningful due to minimal earnings. Recognizing the Corporations June 30, 2018, asset base of $313,424,000, the Corporations price to assets ratio of 6.90 percent represents a midpoint discount relative to the comparable group of 49.41 percent.

 

Exhibits 52 through 57 present the pro forma valuation analysis and conclusions, pricing ratios, use of offering proceeds and a summary of the valuation premiums or discounts relative to the three valuation approaches based on the Corporations minority offering and the reported pricing ratios of the comparable group.

 

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Valuation Analysis and Summary (cont.)

 

Exhibit 57 presents the discounts or premiums of the Corporations minority offering pricing ratios relative to the comparable group. At the midpoint, the Corporations minority offering price to book value ratio of 102.90 percent represents a discount of 7.18 percent relative to the comparable group. The price to core earnings multiple was not meaningful for the Corporation at the midpoint or any other of the ranges due to minimal earnings. The Corporations price to assets ratio of 7.15 percent at the midpoint represents a discount of 47.56 percent.

 

Valuation Conclusion

 

As presented in Exhibit 45, the fully converted pro forma valuation range of the Corporation is from a minimum of $19,550,000 or 1,955,000 shares at $10.00 per share to a maximum of $26,450,000 or 2,645,000 shares at $10.00 per share, with a maximum, as adjusted, of $30,417,500 or 3,041,750 shares at $10.00 per share. Exhibit 45 also presents in detail the total number of shares to be issued at each valuation range and the respective number of shares issued to the mutual holding company and to the public.

 

It is our opinion that, as of August 17, 2018, the pro forma market value of the Corporation was $23,000,000 at the midpoint, representing a total of 2,300,000 shares at $10.00 per share, including 1,035,000 shares or 45.0 percent of the total shares offered to the public, and 1,265,000 shares or 55.00 percent of the total shares issued to TEB MHC, the mutual holding company.

 

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EXHIBITS

 

   

 

 

 

NUMERICAL EXHIBITS 

 

   

 

 

 

EXHIBIT 1 THE EQUITABLE BANK, S.S.B. AND SUBSIDIARIES WAUWATOSA, WISCONSIN Balance Sheet At June 30, 2018 and at September 30, 2017 At June 30, At September 30, 2018 2017 ASSETS Cash and due from banks $ 4,698,851 $ 4,111,082 Federal funds sold 1,435,295 1,506,981 Cash and cash equivalents 6,134,146 5,618,063 Interest-bearing deposits in banks 157,459 91,800 Available-for-sale securities - stated at fair value 20,906,087 20,650,134 Loans, less allowance for loan losses of $1,324,159 and $1,879,304 at June 30, 2018, and September 30, 2017, respectively 263,998,800 262,073,096 Loans held-for-sale 6,416,385 4,062,091 Other real estate owned, net 3,957,133 4,370,981 Premises and equipment, net 8,252,426 8,328,001 Federal Home Loan Bank stock 2,070,000 1,140,500 Accrued interest receivable and other assets 1,531,606 1,505,819 Total assets $ 313,424,042 $ 307,840,485 LIABILITIES AND EQUITY LIABILITIES Deposits Demand $ 64,528,259 $ 63,557,879 Savings and NOW 81,998,195 85,315,092 Certificates of deposit 97,937,026 111,638,142 Total deposits 244,463,480 260,511,113 Federal Home Loan Bank borrowings 46,000,000 22,700,000 Advance payments by borrowers for property taxes and insurance 3,677,434 4,903,864 Accrued interest payable and other liabilities 5,180,996 5,335,448 Total liabilities 299,321,910 293,450,425 EQUITY Retained earnings 16,309,708 16,457,697 Accumulated other comprehensive income (loss) (2,207,576) (2,067,637) Total equity 14,102,132 14,390,060 Total liabilities and equity $ 313,424,042 $ 307,840,485 Source: The Equitaqble Bank S.S.B. and Subsidiaries’ unaudited and audited financial statements 

 

   

 

 

 

EXHIBIT 2 THE EQUITABLE BANK, S.S.B. AND SUBSIDIARIES WAUWATOSA, WISCONSIN Balance Sheets At September 30, 2013, 2014, 2015 and 2016 September 30, ASSETS 2016 2015 2014 2013 Cash and due from banks $ 3,647,172 $ 2,959,440 $ 2,725,189 $ 2,480,740 Federal funds sold 1,177,518 2.915,102 1,756,583 13,221,232 Cash and cash equivalents 4,824,690 5,874,542 4,481,772 15,701,972 Interest-bearing deposits in banks 93,380 911,804 393,403 449,519 Available-for-sale securities - stated at fair value 23,573,739 21,628,083 23,373,300 22,928,434 Loans, less allowance for loan losses of $4,481,615, $2,586,385, $3,971,306 and $4,075,693 at September 30, 2016, 2015, 2014 and 2013, respectively 253,301,856 249,441,773 256,298,852 260,227,723 Loans held-for-sale 9,896,317 2,424,881 2,644,081 1,070,811 Other real estate owned, net 1,996,909 4,542,572 13,687,179 16,367,556 Premises and equipment, net 8,553,922 8,679,421 8,930,585 9,211,616 Federal Home Loan Bank stock 840,400 1,696,800 2,268,100 2,268,100 Accrued interest receivable and other assets 1,531,565 1,790,542 2,608,573 2,204,523 Total assets $304,612,778 $296,990,418 $314,685,845 $ 330,430,254 LIABILITIES AND RETAINED EARNINGS LIABILITIES Deposits Demand $ 58,563,284 $52,524,162 $ 49,325,887 $46,583,125 Savings and NOW 92,514,526 92,333,182 93,559,586 106,242,733 Other time 126,794,331 119,735,838 134,455,605 146,544,569 Total deposits 277,872,141 264,593,182 277,341,078 299,370,427 Other borrowings 500,000 7,500,000 10,500,000 - Advance payments by borrowers for property taxes and insurance 4,193,869 4,021,394 4,578,973 3,888,167 Accrued interest payable and other liabilities 8,647,973 5,084,562 5,543,789 5,227,518 Total liabilities 291,213,983 281,199,138 297,963,840 308,486,112 STOCKHOLDERS’ EQUITY Retained earnings 16,245,894 17,919,624 18,527,803 23,382,076 Accumulated other comprehensive income (loss) (2,847,099) (2,128,344) (1,805,798) (1,437,934) Total stockholders’ equity 13,398,795 15,791,280 16,722,005 21,944,142 Total liabilities and equity $304,612,778 $296,990,418 $ 314,685,845 $ 330,430,254 Source: The Equitaqble Bank, S.S.B. and Subsidiaries’ financial statements

 

   

 

 

 

EXHIBIT 3 THE EQUITABLE BANK, S.S.B. AND SUBSIDIARIES WAUWATOSA, WISCONSIN Statement of Operations For the Year Ended September 30, 2017 and the Twelve Months Ended June 30, 2018 Twelve Months Ended June 30, 2018 Year Ended September 30, 2017 Interest income Interest and fees on loans $ 11,175,710 $ 11,136,269 Interest on investment securities 571,006 574,348 Interest on federal funds sold 14,366 10,802 Interest on deposits in banks 4,016 4,913 Total interest income 11,765,098 11,726,332 Interest expense: Interest on deposits 1,184,741 1,211,450 Interest on federal funds purchased 9 24 Interest on Federal Home Loan Bank borrowings 400,586 53,683 Total interest expense 1,585,336 1,265,157 Net interest income before provision for loan losses 10,179,762 10,461,175 Provision for loan losses 425,000 Net interest income after provision for loan losses 9,754,762 10,461,175 Noninterest income: Service fees on deposits 455,828 462,965 Service fees on loans 192,468 232,235 Gain on sales of mortgage loans 1,398,225 1,579,366 Other income 548,165 348,595 Total noninterest income 2,594,686 2,623,161 Noninterest expense: Compensation and benefits 7,545,748 7,819,541 Occupancy 1,865,930 1,821,290 Advertising and promotions 263,080 363,510 Data processing services FDIC assessment 1,184,194 464,346 1,157,193 424,779 Net loss on and cost of operations of other real estate owned 537,678 116,886 Other expenses 1,280,356 1,169,334 Total noninterest expense 13,141,332 12,872,533 Income (loss) before income taxes (791,884) 211,803 Income tax (benefit) (425,422) Net income (loss) $ (366,462) $ 211,803 Source: The Equitaqble Bank, S.S.B. and Subsidiaries’ unaudited and audited financial statements

 

   

 

 

 

EXHIBIT 4 THE EQUITABLE BANK, S.S.B. AND SUBSIDIARIES WAUWATOSA, WISCONSIN Statements of Operations Years Ended September 30, 2013, 2014, 2015 and 2016 September 30, 2016 2015 2014 2013 Interest income Interest and fees on loans $ 11,002,368 $ 11,233,810 $ 11,829,337 $ 13,371,614 Interest on investment securities 595,785 639,675 565,502 666,231 Interest on federal funds sold 6,296 641 1,722 3,240 Interest on deposits in banks 5,200 2,320 2,103 953 Total interest and dividend income 11,609,649 11,876,446 12,398,664 14,042,038 Interest expense: Interest on deposits 1,153,332 971,061 937,811 1,244,174 Interest on federal funds purchased 152 204 36 94 Interest on ocher borrowings 11,764 18,192 14,180 7,804 Total interest expense 1,165,248 989,457 952,027 1,252,072 Net interest income before provision for loan losses 10,444,401 10,886,989 11,446,637 12,789,966 Provision for loan losses 2,125,000 — 2,067,016 3,541,611 Net interest income after provision for loan losses 8,319,401 10,886,989 9,379,621 9,248,355 Noninterest income: Service fees on deposits 452,557 464,497 480,131 530,558 Service fees on loans 196,660 259,616 300,704 292,673 Gain on sales of mortgage loans 1,947,865 1,435,604 690,039 2,537,131 Gain on sales of securities available-for-sale 161,917 213,873 44,520 260,620 Gain on sale of property 52,347 — — 867,104 Other income 402,729 606,370 1,110,630 995,772 Total noninterest income 3,214,075 2,979,960 2,626,024 5,483,858 Noninterest expense: Compensation and benefits 7,761,770 7,332,466 7,100,084 7,040,609 Occupancy 1,820,886 2,017,804 1,874,123 2,276,197 Advertising 373,950 302,974 399,696 417,696 Data processing services 1,116,284 1,085,898 1,030,759 1,013,016 FDIC assessment 660,565 673,247 703,122 759,375 Net loss on and cost of operations of other real estate owned 293,857 1,190,604 3,948,683 3,299,163 Other expenses 1,404,458 1,872,135 1,803,451 2,913,116 Total noninterest expense 13,431,770 14,475,128 16,859,918 17,719,172 Net income (loss) before income taxes (1,898,294) (608,179) (4,854,273) (2,986,959) Provision (benefit) for income taxes (224,564) — — 32,500 Net income (loss) $(1,673,730) $ (608,179) $ (4,854,273) $(3,019,459) Source: The Equitable Bank, S.S.B. and Subsidiaries’ financial statements

 

   

 

 

 

EXHIBIT 5 Selected Financial Information At June 30, 2018 and At September 30, 2014, 2015, 2016 and 2017 At. June 30 2018 2017 At September 30, 2016 2015 2014 (In thousands) Selected Financial Condition Data: Total assets $313,424 $ 307,840 $ 304,613 $ 296,990 $ 314,686 Cash and cash equivalents 6,134 5,618 4,825 5,875 4,482 Available-for-sale securities 20,906 20,650 23,574 21,628 23,373 Loans, net of allowance for loan losses 263,999 262,073 253,302 249,442 256,299 Loans Held-for-sale 6,416 4,062 9,896 2,425 2,644 Other real estate owned, net 3,957 4,371 1,997 4,543 13,687 Premises and equipment, net 8,252 8,328 8,554 8,679 8,931 Federal Home Loan Bank stock 2,070 1,141 840 1,697 2,268 Deposits 244,463 260,511 277,872 264,593 277,341 Borrowings 46,000 22,700 500 7,500 10,500 Deferred tax asset valuation allowance 10,503 14,353 14,769 13,855 11,465 Total stockholders’ equity 14,102 14,390 13,399 15,791 16,722 Source: TEB Bancorp, Inc.’s Prospectus

 

   

 

 

 

EXHIBIT 6 Income and Expense Trends For the Nine Months Ended June 30, 2017 and 2018, and the Years Ended September 30, 2014, 2015, 2016 and 2017 For the Nine Months Ended For the Years Ended June 30, September 30, 2018 2017 2017 2016 2015 2014 Selected Operating Data: (In thousands) Interest income $ 8,821 $ 8,760 $ 11,736 $ 11,620 $ 11,887 $ 12,408 Interest expense 1,256 936 1,265 1,165 989 952 Net interest income before provision for loan losses 7,565 7,824 10,471 10,455 10,898 11,456 Provision for loan losses 425 0 0 2,125 0 2,067 Net interest income after provision for loan losses 7,140 7,824 10,471 8,330 10,898 9,389 Noninterest income 1,895 1,946 2,612 3,189 2,910 2,515 Noninterest expense 10,062 9,794 12,871 13,417 14,416 16,758 Income (loss) before income tax expense (benefit) (1,027) (24) 212 (1,898) (608) (4,854) Income tax expense (benefit) (425) 0 0 (224) 0 0 Net income (loss) $ (602) $ (24) $ 212 S (1,674) S (608) $ (4,854) Source: TED Bancorp, Inc.’s Prospectus

 

   

 

 

 

EXHIBIT 7 The Equitable Bank, S.S.B. Normalized Earnings Trends Twelve Months Ended June 30, 2018 Twelve Months Ended June 30, 2018 (In thousands) Net income before taxes $ (792) Adjustments: Provision for loan losses Real estate owned losses (425) (234) Normalized earnings before taxes (133) Taxes 0 Normalized earnings after taxes $ (133) Source: The Equitable Bank’s audited and unaudited financial statements

 

   

 

 

 

EXHIBIT 8 Performance Indicators At or for the Nine Months Ended June 30, 2017 and 2018 and At or for the Years Ended September 30, 2014, 2015, 2016 and 2017 At or for the Nine Months Ended June 30,(1) At or for the Years Ended September 30, 2018 2017 2017 2016 2015 2014 Performance Ratios Return (loss) on average assets (0.27)% (0.01)% 0.07% (0.56)% (0.20)% (1.51)% Return (loss) on average equity (5.72)% (0.24)% 1.60% (10.54)% (3.67)% (22.96)% Interest rate spread (2) 3.57% 3.65% 3.67% 3.70% 4.01% 4.07% Net interest margin (3) 3.61% 3.68% 3.70% 3.73% 4.02% 4.07% Noninterest expenses to average assets 4.48% 5.77% 4.26% 4.47% 4.83% 5.28% Efficiency ratio (4) 106.39% 100.25% 98.38% 98.33% 104.25% 119.60% Average interest-earning assets to average interest-bearing liabilities 106.10% 106.35% 106.38% 106.34% 103.45% 101.07% Capital Ratios: Average equity to average assets 4.68% 4.38% 4.38% 5.30% 5.46% 6.59% Tangible capital equity to total assets 5.20% 5.30% 5.35% 5.33% 6.03% 5.89% Total capital to risk-weighted assets 8.90% 9.10% 9.25% 9.26% 9.85% 9.85% Tier 1 capital to risk-weighted assets 8.23% 8.15% 8.30% 8.00% 8.60% 8.59% Common equity Tier 1 capital to risk-weighted assets 8.23% 8.15% 8.30% 8.00% 8.60% 8.59% Tier 1 capital to average assets 5.44% 5.37% 5.45% 5.42% 5.91% 5.77% Asset Quality Ratios: Allowance for loan losses as a percentage of total loans 0.50% 0.73% 0.72% 1.77% 1.04% 1.55% Allowance for loan losses as a percentage of nonperforming loans 91.69% 130.29% 106.46% 57.48% 88.50% 53.55% Net (charge-offs) recoveries to average outstanding loans during the period (0.38)% (1.34)% (1.01)% (0.09)% (0.55)% (0.84)% Nonperforming loans as a percentage of total loans 0.55% 0.56% 0.67% 3.08% 1.17% 2.89% Nonperforming loans as a percentage of total assets 0.46% 0.48% 0.57% 2.56% 0.98% 2.36% Total nonperforming assets as a percentage of total assets 1.72% 2.06% 1.99% 3.22% 2.93% 7.16% (1) Annualized (2) Represents the difference between the weighted average yield ona average interest-earning assets and the weighted average cost of interest-bearing liabilities. (3) Represents net interest income as a percentage of average interest-earning assets. (4) Represents noninterest expenses divided by the sum of net interest income and noninterest income. Source: TEB Bancorp, Inc.’s Prospectus

 

   

 

 

 

EXHIBIT 9 Volume/Rate Analysis For the Nine Months Ended June 30, 2018 and the Year Ended September 30, 2017 Nine Months Ended June 30 Year Ended September 30, 2018 vs. 2017 2017 vs. 2016 Increase (Decrease) Increase (Decrease) Due to Due to Volume Rate Total Volume Rate Total (Dollars in thousands) (Dollars in thousands) Interest-earning assets: Loans $ (49) $88 $ 39 $ 260 $ (126) $134 Securities (28) 25 (3) (24) 3 (21) Federal Home Loan Bank stock 12 11 23 (5) 4 (1) Other (12) 13 1 (10) 14 4 Total interest-earning assets $ (77) $137 $ 60 221 $ (105) $116 Interest-bearing liabilities: Demand deposits $ 1 $0 $ 1 $ 2 $ 0 $2 Savings and NOW deposits (5) (1) (6) (2) 1 (1) Certificates of deposits (199) 178 (21) (7) 65 58 Total interest-bearing deposits $ (203) $177 $ (26) $ (7) $ 66 $59 Borrowings 338 8 346 23 7 30 Other 0 0 0 0 0 0 Total interest-bearing liabilities 135 185 320 16 73 89 Change in net interest income $ (212) $ (48) $ (260) $ 205 $ (178) $27 Source: TEB Bancorp, Inc.’s Prospectus

 

   

 

 

 

EXHIBIT 10 Yield and Cost Trends At June 30, 2018, For the Nine Months Ended June 30, 2017 and 2018, and For the Years Ended September 30, 2016 and 2017 For the Nine Months Ended For the Years Ended At June 30, June 30, September 30, 2018 2018 2017 2017 2016 Yield/ Yield/ Yield/ Yield/ Yield/ Rate Rate(1) Rate(1) Rate Rate Interest-earning assets: Loans 4.22% 4.34% 4.30% 4.32% 4.37% Securities 2.80% 2.79% 2.64% 2.65% 2.64% Federal Home Loan Bank stock 1.91% 2.79% 1.05% 1.13% 0.80% Other 0.76% 1.12% 0.51% 0.60% 0.27% Total interest-earning assets 4.07% 4.20% 4.12% 4.15% 4.15% Interest-bearing liabilities: Demand deposits 0.04% 0.06% 0.06% 0.06% 0.06% Savings and NOW deposits 0.09% 0.09% 0.09% 0.09% 0.09% Certificates of deposit 1.12% 1.07% 0.88% 0.88% 0.83% Total interest-bearing deposits 0.49% 0.51% 0.47% 0.46% 0.44% Borrowings 1.04% 1.59% 0.92% 1.15% 0.87% Other 0.12% 0.15% 0.15% 0.14% 0.15% Total interest-bearing liabilities 0.57% 0.64% 0.47% 0.48% 0.45% Net interest rate spread (2) — 3.57% 3.65% 3.67% 3.70% Net interest margin (3) — 3.61% 3.68% 3.70% 3.73% Average interest-earning assets to 106.34% interest-bearing liabilities — 106.10% 106.35% 106.38% (1) Annualized (2) Net interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average rate of interest-bearing liabilities. (3) Net interest margin represents net interest income divided by average total interest-earning assets. Source: TEB Bancorp, Inc.’s Prospectus

 

   

 

 

 

EXHIBIT 11 Net Portfolio Value At June 30, 2018 Estimated Increase (Decrease) in NEV NEV as a Percentage of Present Value of Assets(3) Change in Interest Rates (Basis Points)(1) Estimated NEV (2) $ Amount % Change NEV Ratio(4) Increase (Decrease) (Basis Points) (Dollars in thousands) +400 $17,589 $(11,162) (38.82)% 6.86% (291) +200 24,662 (4,089) (14.22)% 8.95% (82) — 28,751 0 — 9.77% — -200 28,757 6 0.02% 9.17% (60) -400 34,880 6,129 21.32% 10.45% 68 (1) Assumes an immediate uniform change in interest rates at all maturities. (2) NEV is the discounted present value of expected cash flows from assets, liabilities and off-balance sheet contracts. (3) Present value of assets represents the discounted present value of incoming cash flows on interest-earning assets. (4) NEV ratio represents NEV divided by the present value of assets. Source: TEB Bancorp, Inc.’s Prospectus

 

   

 

 

 

EXHIBIT 12 Loan Portfolio Composition At June 30, 2018, and, At September 30, 2014, 2015, 2016 and 2017 (Dollars in thousands) At June 30, 2018 At September 30, 2017 2016 2015 2014 Amount Percent Amount Percent Amount Percent Amount Percent Amount Percent Construction, land and development $ 4,845 1.83% $ 3,455 1.31% $ 3,215 1.25% $ 6,908 2.74% $ 16,115 6.19% One- to four-family owner-occupied residential 122,599 46.21% 119,847 45.40% 114,722 44.50% 117,197 46.50% 117,267 45.06% One- to four-family nonowner-occupied residential 23,837 8.98% 22,837 8.65% 22,516 8.73% 18,851 7.48% 21,361 8.21% Multifamily 71,101 26.80% 60,883 23.07% 58,532 22.71% 54,307 21.55% 45,136 17.34% Commercial real estate 29,451 11.10% 42,127 15.96% 43,829 17.00% 39,338 15.61% 42,375 16.28% Commercial and industrial 2,112 0.80% 1,881 0.71% 1,380 0.54% 368 0.15% 1,064 0.41% Consumer and installment 11,378 4.29% 12,922 4.90% 13,588 5.27% 15,059 5.98% 16,952 6.51% $ 265,323 100.0% $ 263,952 100.0% $ 257,782 100.0% $ 252,028 100.0% $ 260,270 100.0% Less: Allowance for losses (1,324) (1,879) (4,482) (2,586) (3,971) Total loans $ 263,999 $ 262,073 $ 253,300 $ 249,442 $ 256,299 Source: TEB Bancorp, Inc.’s Prospectus

 

   

 

 

 

EXHIBIT 13 Loan Maturity Schedule At June 30, 2018 At June 30, 2018 One- to Four- One- to Four- Construction, Family Owner-Family Nonowner- Land and Occupied Occupied Commercial Commercial Consumer and Amounts due in: Development Residential Residential Multifamily Real Estate and Industrial Installment Total (Dollars in thousands) One year or less $ 2,257 $ 0 $ 1,178 $ 4,271 $ 3,113 $ 1,633 $ 1,406 $ 13,858 More than one year through five years 505 240 8,562 42,924 12,403 479 481 65,594 More than five years 2,084 122,359 14,098 23,906 13,934 0 9,491 185,872 Total $ 4,846 $ 122,599 $ 23,838 $71,101 $ 29,450 $2,112 $ 11,378 $ 265,324 Fixed and Adjustable-Rate Loan Schedule Due After June 30, 2019 Fixed Adjustable Total (Dollars in thousands) Construction, land and development $ 449 $ 2,139 $ 2,588 One- to four-family owner-occupied residential 25,993 96,606 122,599 One- to four-family nonowner-occupied residential 10,139 12,520 22,659 Multifamily 54,171 12,659 66,830 Commercial real estate 14,970 11,368 26,338 Commercial and industrial 479 0 479 Consumer and installment 199 9,773 9,972 Total loans $ 106,400 $ 145,065 $ 251,465 Source: TEB Bancorp, Inc.’s Prospectus

 

   

 

 

 

EXHIBIT 14 Loan Delinquencies At June 30, 2018, and at September 30, 2014, 2015, 2016 and 2017 30-59 Loans Delinquent For 60-89 90 Days Days Days or More Amount Amount Amount (Dollars in thousands) At June 30, 2018 Construction, land and development $ 75 $ — $ 87 One- to four-family owner-occupied residential 2,175 — 924 One- to four-family nonowner-occupied residential — — 95 Multifamily — — — Commercial real estate — — 199 Commercial and industrial — — — Consumer and installment 91 — 139 Total $2,341 $ 0 $1,444 At September 30, 2017 Construction, land and development $ 116 $ — $ — One- to four-family owner-occupied residential 1,346 38 1,225 One- to four-family nonowner-occupied residential — — 95 Multifamily — — — Commercial real estate 158 — 203 Commercial and industrial — — — Consumer and installment 34 — 242 Total $1,654 $ 38 $1,765 At September 30, 2016 Construction, land and development $ 119 $ — $ — One- to four-family owner-occupied residential 1,948 223 1,208 One- to four-family nonowner-occupied residential — 21 129 Multifamily — — Commercial real estate 168 — 6,461 Commercial and industrial — — — Consumer and installment 87 15 — Total $2,322 $ 259 $7,798 At September 30, 2015 Construction, land and development $ 120 $ — $ 230 One- to four-family owner-occupied residential 2,059 896 2,244 One- to four-family nonowner-occupied residential 82 — — Multifamily — — 56 Commercial real estate — — 217 Commercial and industrial — — — Consumer and installment 49 55 175 Total $2,310 $ 951 $2,922 At September 30, 2014 Construction, land and development $ 8 $ — $2,805 One- to four-family owner-occupied residential 1,759 — 3,044 One- to four-family nonowner-occupied residential — — 473 Multifamily 59 209 — Commercial real estate 349 — 790 Commercial and industrial — — — Consumer and installment 167 149 304 Total $2,342 $ 358 $7,416 Source: TEB Bancorp, Inc.'s Prospectus

 

   

 

 

 

EXHIBIT 15 Nonperforming Assets At June 30, 2018, and at September 30, 2014, 2015, 2016 and 2017 At June 30, At September 30, 2018 2017 2016 2015 2014 (Dollars in thousands) Nonaccrual loans: Construction, land and development $ 87 $— $— $ 230 $ 2,805 One- to four-family owner-occupied residential 924 1,225 1,208 2,244 3,044 One- to four-family nonowner-occupied residential 95 95 129 — 473 Multifamily — — — 56 — Commercial real estate 199 203 6,461 217 790 Commercial and industrial — — — — — Consumer and installment 139 242 — 175 304 Total nonaccrual loans $ 1,444 $ 1,765 $ 7,798 $ 2,922 $ 7,416 Accruing loans past due 90 days or more $— $— $— $ 1,238 $ 1,428 Real estate owned Construction, land and development $ 1,114 $ 1,278 $ 1,753 $ 2,942 $ 2,897 One- to four-family owner-occupied residential 88 136 243 389 1,729 One- to four-family nonowner-occupied residential — — — 65 1,062 Multifamily — — — — 265 Commercial real estate 2,741 2,957 — 1,146 7,733 Commercial and industrial — — — — — Consumer and installment 14 — — — — Total real estate owned $ 3,957 $ 4,371 $ 1,996 $ 4,542 $ 13,686 Total nonperforming assets $ 5,401 $ 6,136 $ 9,794 $ 8,702 $ 22,530 Total accruing troubled debt restructured loans $— $ 1,408 $ 2,592 $ 16,727 $ 20,258 Total nonperforming loans to total loans 0.55% 0.67% 3.08% 1.17% 2.89% Total nonperforming assets to total assets 1.72% 1.99% 3.22% 2.93% 7.16% Source: TEB Bancorp, Inc.'s Prospectus

 

   

 

 

 

EXHIBIT 16 Classified Assets At June 30, 2018, and at September 30, 2017 (Dollars in thousands) At At June 30, September 30, 2018 2017 Substandard assets $ 5,901 $ 8,076 Doubtful assets 0 0 Loss assets 175 200 Total classified assets $ 6,076 $ 8,276 Special mention assets $ 11,343 $ 8,369 Source: TEB Bancorp, Inc.'s Prospectus

 

   

 

 

 

EXHIBIT 17 Allowance for Loan Losses At for the Nine Months Ended June 30, 2017 and 2018, and For the Years Ended September 30, 2014, 2015, 2016 and 2017 Nine Months Ended June 30 Years Ended September 30, 2018 2017 2017 2016 2015 2014 (Dollars in thousands) Allowance at beginning of period $ 1,879 $4,482 $4,482 $2,586 $3,971 $ 4,076 Provision for loan losses 425 — — 2,125 — 2,067 Charge-offs: Construction, land and development — — — 65 907 171 One- to four-family owner-occupied residential 54 8 14 90 125 567 One- to four-family nonowner-occupied residential — 18 18 5 200 955 Multi-family — — — — — 240 Commercial real estate 980 2,610 2,639 — 5 307 Commercial and industrial — — — 99 — — Consumer and installment 1 2 4 155 207 179 Total charge-offs 1,035 5,636 2,675 414 1,444 2.419 Recoveries: Construction, land and development 30 9 12 90 18 14 One- to four-family owner-occupied residential 18 27 34 79 8 9 One- to four-family nonowner-occupied residential 1 9 9 4 13 46 Multi-family — 1 1 — — Commercial real estate 4 8 11 — 3 151 Commercial and industrial — — — 4 — — Consumer and installment 2 4 5 8 17 28 Total recoveries 55 58 72 185 59 248 Net (charge-offs) recoveries (980) (2,580) (2,603) (229) (1,385) (2,171) Allowance at end of period $ 1,324 $1,902 $1,879 $4,482 $2,586 $ 3,972 Ratios: Allowance to nonperforming loans 91.69% 107.76% 106.46% 57.48% 88.50% 53.56% Allowance to total loans outstanding at the end of the period 0.50% 0.73% 0.71% 1.74% 1.03% 1.53% Net (charge-offs) recoveries to average loans outstanding during the period 0.51% (1) (1.32)% (1) (1.00)% (0.09)% (0.54)% (0.78)% (1 Annualized Source: TEB Bancorp Inc.'s Prospectus

 

   

 

 

 

EXHIBIT 18 Investment Portfolio Composition At June 30, 2018 and at September 30, 2016 and 2017 At September 30 At June 30, 2018 2017 2016 Amortized Estimated Amortized Estimated Amortized Estimated Security Type Cost Fair Value Cost Fair Value Cost Fair Value (In thousands) Obligations of states and political subdivisions $ 19,847 $ 19,426 $ 20,621 $ 20,643 $ 20,993 $ 21,540 Mortgage-backed securities 1,162 1,158 7 7 38 39 Certificates of deposit 330 322 — — — — Commercial paper— — — 1,995 1,995 Total $ 21,339 $ 20,906 $ 20,628 $ 20,650 $ 23,026 $ 23,574 Source: TEB Bancorp, Inc.'s Prospectus

 

   

 

 

 

EXHIBIT 19 Mix of Total Deposit Accounts At June 30, 2018 and At September 30, 2016 and 2017 At September 30, At June 30, 2018 2017 2016 (Dollars in thousands) Deposit type: Average Balance Percent Rate Average Balance Percent Rate Average Balance Percent Rate Noninterest-bearing accounts $ 16,125 6.60% 0.00% $ 16,407 6.30% 0.00% $ 14,759 5.31% 0.00% Interest-bearing demand 48,403 19.80% 0.06% 47,150 18.10% 0.06% 43,804 15.76% 0.06% Interest-bearing savings and NOW accounts 81,998 33.54% 0.09% 85,315 32.75% 0.09% 92,515 33.29% 0.09% Certificates of deposit 97,937 40.06% 1.26% 111,638 42.85% 0.95% 126,794 45.63% 0.87% Total deposits $ 244,463 100.00% $ 260,510 100.00% $ 277,872 100.00% Source: TED Bancorp, Inc.’s Prospectus

 

   

 

 

 

EXHIBIT 20 Certificates of Deposit By Maturity At June 30, 2018 At June 30 2018 (In thousands) Maturity Period: Three months or less $ 570 Over three months through six months 538 Over six months through twelve months 1,688 Over twelve months 6,780 Total $ 9,576 Source: TEB Bancorp, Inc.'s Prospectus

 

   

 

 

 

EXHIBIT 21 Borrowed Funds At or for the Nine Months Ended June 30, 2017 and 2018, and At or for the Years Ended September 30, 2016 and 2017 At or for the Nine Months At or for the Ended June 30, Years Ended September 30, 2018 2017 2017 2016 (Dollars in thousands) Balance outstanding at end of period $ 46,000 $ 6,500 $ 22,700 $ 500 Weighted average interest rate at the end of period 1.92% 1.20% 1.21% 0.53% Maximum amount of borrowings outstanding at any month end during the period $ 46,000 $ 6,500 $ 22,700 $ 7,700 Average balance outstanding during the period $ 29,758 $ 1,678 $ 4,625 $ 2,753 Weighted average interest rate during the period 1.59% 0.89% 1.14% 0.42% Source: TEB Bancorp, Inc.'s Prospectus

 

 

   

 

 

 

 

EXHIBIT 22 OFFICES OF THE EQUITABLE BANK, S.S.B. WAUWATOSA, WISCONSIN As of June 30, 2018 Location Leased or Owned Year Acquired or Leased Net Book Value at June 30, 2018 (In thousands) Main Office: 2290 N. Mayfair Road Wauwatosa, Wisconsin 53226 Owned 1993 $ 1,835 Other Properties: 7400 W. Oklahoma Avenue West Allis, Wisconsin 53219 Owned 1992 205 705 E. Silver Spring Drive Whitefish Bay, Wisconsin 53217 Leased 2004 37 5225 S 108th Street Hales Corners, Wisconsin 53130 Owned 1982 348 701 Trailview Court Waterford, Wisconsin 53185 Owned 2008 1,610 N15 W30921 Golf Road Delafield, Wisconsin 53018 Owned 2007 3,401 Mortgage Lending Office W62 N244 Washington Avenue Suite A-101 Cedarburg, Wisconsin 53012 Leased 2012 N/A Source: TEB Bancorp, Inc.'s Prospectus

 

   

 

 

 

EXHIBIT 23 DIRECTORS AND MANAGEMENT OF THE BANK At June 30, 2018 Name Position Age Director Since Term Expires Joseph J. Becker Director 73 1991 2019 Christopher C. Conlon Director 65 2002 2019 John P. Matter President, Chief Executive Officer and Director 66 2000 2018 Charles R. Pittelkow Chairman of the Board 79 1971 2020 Jennifer L. Provancher Executive Vice President, Chief Operating Officer, Chief Financial Officer, and Director 59 2005 2020 Otto R. Radke Director 81 1993 2020 Julie A. Taylor Director 76 1994 2018 William A. Behm Chief Credit Officer — — — Source: TEB Bancorp, Inc.'s Prospectus

 

   

 

 

 

EXHIBIT 24 Key Demographic Data and Trends Milwaukee, Racine and Waukesha Counties, Wisconsin and the United States 2000, 2010 and 2020 2000 2010 % Change 2020 % Change Population Milwaukee County 940,164 947,735 0.8% 951,408 0.4% Racine County 188,831 195,408 3.5% 196,613 0.6% Waukesha County 360,767 389,891 8.1% 409,364 5.0% Wisconsin 5,363,675 5,686,986 6.0% 5,887,190 3.5% United States 281,421,906 308,745,538 9.7% 332,139,637 7.6% Households Milwaukee County 377,729 383,591 1.6% 388,428 1.3% Racine County 70,819 75,651 6.8% 76,269 0.8% Waukesha County 135,229 152,663 12.9% 159,863 4.7% Wisconsin 2,084,544 2,279,768 9.4% 2,363,096 3.7% United States 105,480,101 116,716,292 10.7% 125,527,510 7.5% Per Capital Income Milwaukee County $ 19,939 $ 24,254 21.6% — — Racine County 21,772 27,292 25.4% — – Waukesha County 29,164 37,282 27.8% — — Wisconsin 21,271 27,192 27.8% — — United States 22,162 26,059 17.6% — — Median Household Income Milwaukee County $ 38,100 $ 43,599 14.4% $ 49,722 14.0% Racine County 48,059 54,900 14.2% 56,863 3.6% Waukesha County 62,839 75,689 20.4% 84,386 11.5% Wisconsin 43,791 52,374 19.6% 57,579 9.9% United States 41,994 50,046 19.2% 61,618 23.1% Source: U.S. Census and Business Decision

  

   

 

 

 

EXHIBIT 25 Key Housing Data Milwaukee, Racine and Waukesha Counties, Wisconsin and the United States 2000 & 2010 Occupied Housing Units 2000 2010 Milwaukee County 377,729 383,591 Racine County 188,831 195,408 Waukesha County 135,229 152,663 Wisconsin 2,084,544 2,279,768 United States 105,480,101 116,716,292 Occupancy Rate Milwaukee County Owner-Occupied 52.6% 51.3% Renter-Occupied 47.4% 48.7% Racine County Owner-Occupied 70.6% 69.9% Renter-Occupied 29.4% 30.1% Waukesha County Owner-Occupied 76.4% 76.8% Renter-Occupied 23.6% 23.2% Wisconsin Owner-Occupied 68.4% 68.1% Renter-Occupied 31.6% 31.9% United States Owner-Occupied 66.2% 65.4% Renter-Occupied 33.8% 34.6% Median Housing Values Milwaukee County $ 103,200 $ 162,900 Racine County 111,000 174,600 Waukesha County 170,400 257,700 Wisconsin 112,200 169,000 United States 119,600 186,200 Median Rent Milwaukee County $ 555 $ 786 Racine County 548 751 Waukesha County 726 906 Wisconsin 540 749 United States 602 871 Source: U.S. Census Bureau

  

   

 

 

 

 

EXHIBIT 26 Major Sources of Employment by Industry Group Milwaukee, Racine and Waukesha Counties Wisconsin and the United States 2000 and 2010 2000 Milwaukee Racine Waukesha United Industry Group County County County Wisconsin States Agriculture/Mining 0.3% 0.8% 0.4% 2.8% 1.9% Construction 4.0% 5.7% 6.3% 5.9% 6.8% Manufacturing 18.5% 28.6% 21.2% 22.2% 14.1% Wholesale/Retail 13.6% 14.7% 16.6% 14.8% 15.3% Transportation/Utilities 5.3% 4.8% 4.1% 4.5% 5.2% Information 3.0% 1.8% 3.1% 2.2% 3.1% Finance, Insurance & Real Estate 7.7% 4.5% 7.7% 6.1% 6.9% Services 47.6% 39.1% 40.6% 41.5% 46.7% 2010 Milwaukee Racine Waukesha United County County County Wisconsin States Agriculture/Mining 0.6% 1.3% 0.5% 2.4% 1.9% Construction 3.6% 6.2% 5.6% 5.6% 6.2% Manufacturing 15.0% 22.0% 18.2% 18.4% 10.4% Wholesale/Retail 12.9% 13.3% 15.8% 14.2% 14.5% Transportation/Utilities 4.6% 5.4% 3.9% 4.5% 4.9% Information 2.2% 1.5% 1.9% 1.8% 2.2% Finance, Insurance & Real Estate 7.3% 4.9% 8.6% 6.3% 6.7% Services 54.1% 45.3% 45.5% 46.8% 53.2% Source: Bureau of the Census

 

   

 

 

 

EXHIBIT 27 Unemployment Rates Milwaukee Racine and Waukesha Counties, Wisconsin and the United States For the Years 2014 through May of 2018 Location 2014 2015 2016 2017 May 2018 Milwaukee County 6.9% 5.7% 5.0% 4.0% 3.2% Racine County 6.6% 5.6% 4.9% 4.1% 3.1% Waukesha County 4.4% 3.8% 3.4% 2.9% 2.4% Wisconsin 5.4% 4.5% 4.0% 3.3% 2.6% United States 6.2% 5.3% 4.9% 4.4% 3.6% Source: Local Area Unemployment Statistics - U.S. Bureau of Labor Statistics

  

   

 

 

 

EXHIBIT 28 Market Share of Deposits Milwaukee, Racine and Waukesha Counties June 30, 2017 Milwaukee County Equitable's Equitable's Deposits Deposits Share ($000) ($000) (%) Banks $ 50,731,896 — — Thrifts 2,636,079 $ 228,040 8.7% Total $ 53,367,975 $ 228,040 0.4% Racine County Equitable's Equitable's Deposits Deposits Share ($000) ($000) (%) Banks $ 2,876,825 Thrifts 202,286 $ 32,866 16.2% Total $ 3,079,111 $ 32,866 1.1% Waukesha County Equitable's Equitable's Deposits Deposits Share ($000) ($000) (%) Banks $ 10,419,566 — — Thrifts 1,544,580 $ 22,804 1.5% Total $ 11,964,146 $ 22,804 0.2% Total Equitable's Equitable's Deposits Deposits Share ($000) ($000) (%) Banks $ 64,028,287 — — Thrifts 4,382,945 $ 283,710 6.5% Total $ 68,411,232 $ 283,710 0.4% Source: FDIC

 

   

 

 

 

EXHIBIT 29 National Interest Rates by Quarter 2014 - 2nd Quarter of 2018 1st Qtr. 2nd Qtr. 3rd Qtr. 4th Qtr. 2014 2014 2014 2014 Prime Rate 3.25% 3.25% 3.25% 3.25% 90-Day Treasury Bills 0.05% 0.04% 0.13% 0.07% 1-Year Treasury Bills 0.13% 0.11% 0.14% 0.13% 30-Year Treasury Notes 3.56% 3.34% 3.07% 2.75% 1st Qtr. 2nd Qtr. 3rd Qtr. 4th Qtr. 2015 2015 2015 2015 Prime Rate 3.25% 3.25% 3.25% 3.50% 90-Day Treasury Bills 0.03% 0.01% 0.01% 0.16% 1-Year Treasury Bills 0.26% 0.28% 0.32% 0.62% 30-Year Treasury Notes 2.54% 3.20% 2.87% 3.01% 1st Qtr. 2nd Qtr. 3rd Qtr. 4th Qtr. 2016 2016 2016 2016 Prime Rate 3.50% 3.50% 3.50% 3.75% 90-Day Treasury Bills 0.24% 0.30% 0.32% 0.51% 1-Year Treasury Bills 0.53% 0.58% 0.57% 0.81% 30-Year Treasury Notes 2.61% 2.26% 2.40% 2.97% 1st Qtr. 2nd Qtr. 3rd Qtr. 4th Qtr. 2017 2017 2017 2017 Prime Rate 4.00% 4.25% 4.25% 4.50% 90-Day Treasury Bills 0.92% 1.01% 1.04% 1.37% 1-Year Treasury Bills 1.17% 1.24% 1.31% 1.76% 30-Year Treasury Notes 2.92% 2.84% 2.86% 2.74% 1 st Qtr. 2nd Qtr. 2018 2018 Prime Rate 4.75% 5.00% 90-Day Treasury Bills 1.74% 1.89% 1-Year Treasury Bills 2.09% 2.33% 30-Year Treasury Notes 2.97% 2.98% Source: The Wall Street Journal

 

   

 

 

 

Page 1 KELLER & COMPANY Dublin, Ohio 614-766-1426 SHARE DATA AND PRICING RATIOS PUBLICLY-TRADED, FDIC-INSURED SAVINGS INSTITUTIONS (EXCLUDING MUTUAL HOLDING COMPANIES) EXHIBIT 30 PRICES AS OF JUNE 30, 2018 ALL RATIOS/FINANCIAL DATA AS OF MOST RECENT FOUR QUARTERS PER SHARE PRICING RATIOS 52 Week Earnings 12 Month Price/Net Price/Core Price/ Price/Tang. Price/ Price Change (EPS) Assets Div. Earnings Earnings Book Value Book Value Assets State Exchange ($) (%) ($) ($) ($) (X) (X) (X) (X) (X) SZBI SOUTHFIRST BANCSHARES AL OTC PINK 4.95 (1.4) 0.37 125.33 0.00 13.38 9.90 35.69 35.69 3.95 BOFI BOFI HOLDING CA NASDAQ 40.91 72.5 2.36 159.58 0.00 17.33 34.67 277.73 280.78 25.64 BYFC BROADWAY FINANCIAL CORP CA NASDAQ 2.20 4.3 0.07 14.57 0.00 31.43 31.43 127.17 127.17 15.10 MLGF MALAGA FINANCIAL CORPORATION CA OTC BB 31.25 20.2 2.30 165.37 1.00 13.59 14.33 153.56 153.56 18.90 PROV PROVIDENT FINANCIAL HOLDINGS CA NASDAQ 19.08 (0.9) 0.23 157.70 0.55 82.96 48.92 118.07 118.95 12.10 FBNK FIRST CONNECTICUT BANCORP CT NASDAQ 30.60 19.3 1.07 196.31 0.57 28.60 21.40 176.67 180.21 15.59 SIFI SI FINANCIAL GROUP CT NASDAQ 14.75 (8.4) 0.45 130.55 0.21 32.78 23.05 106.88 119.43 11.30 UBNK UNITED FINANCIAL BANCORP CT NASDAQ 17.52 5.0 1.11 139.05 0.36 15.78 14.60 128.92 159.42 12.60 WSFS WSFS FINANCIAL CORP DE NASDAQ 53.30 17.5 2.15 218.35 0.32 24.79 19.96 228.56 305.44 24.41 ABCB AMERIS BANCORP GA NASDAQ 53.35 10.7 2.06 209.33 0.40 25.90 21.51 235.33 319.08 25.49 CHFN CHARTER FINANCIAL CORP GA NASDAQ 24.15 34.2 1.04 109.65 0.28 23.22 22.78 164.96 206.23 22.02 CFBI COMM FIRST BANCSHARES GA NASDAQ 11.11 NM 0.01 38.80 0.00 NM 92.58 110.66 110.66 28.63 TBNK TERRITORIAL BANCORP HI NASDAQ 31.00 (0.6) 1.59 211.19 1.20 19.50 19.38 129.87 129.98 14.68 WCFB WCF BANCORP IA NASDAQ 9.00 NM 0.09 48.57 0.20 100.00 NM 82.19 82.42 18.53 AJSB AJS BANCORP IL OTC BB 14.05 (4.4) 0.05 90.18 0.20 NM 48.45 103.77 103.77 15.58 AFBA ALLIED FIRST BANCORP IL OTC BB 1.35 (10.0) (0.19) 61.54 0.00 NM 2.76 NM NM 2.19 BFFI BEN FRANKLIN FINANCIAL IL OTC BB 8.25 (29.8) (0.47) 79.96 0.00 NM NM 101.10 101.10 10.32 BTHT BEST HOMETOWN BANCORP IL OTC PINK 13.50 NM (0.39) 130.66 0.00 NM NM 91.53 91.53 10.33 GTPS GREAT AMERICAN BANCORP IL OTC BB 31.85 8.9 1.49 412.87 0.42 21.38 16.09 81.56 87.60 7.71 IROQ IF BANCORP IL NASDAQ 23.90 21.5 0.48 159.15 0.10 49.79 44.26 113.97 115.07 15.02 JXSB JACKSONVILLE BANCORP IL NASDAQ 33.65 7.0 1.61 178.23 0.40 20.90 16.83 127.80 137.23 18.88 MCPH MIDLAND CAPITAL HOLDINGS CORP IL OTC PINK 24.00 26.1 0.25 315.57 0.16 96.00 70.59 82.36 82.36 7.61 OTTW OTTAWA SAVINGS BANCORP IL OTC BB 13.88 0.8 0.29 78.35 0.24 47.86 25.24 92.47 95.00 17.72

 

   

 

 

Page 2 KELLER & COMPANY Dublin, Ohio 614-766-1426 SHARE DATA AND PRICING RATIOS PUBLICLY-TRADED, FDIC-INSURED SAVINGS INSTITUTIONS (EXCLUDING MUTUAL HOLDING COMPANIES) PRICES AS OF JUNE 30, 2018 ALL RATIOS/FINANCIAL DATA AS OF MOST RECENT FOUR QUARTERS PER SHARE PRICING RATIOS 52 Week Earnings 12 Month Price/Net Price/Core Price/ Price/Tang. Price/ Price Change (EPS) Assets Div. Earnings Earnings Book Value Book Value Assets State Exchange ($) (%) ($) ($) ($) (X) (X) (X) (X) (X) RYFL ROYAL FINANCIAL IL OTC BB 17.45 46.3 1.15 171.47 0.00 15.17 10.71 96.78 103.68 10.18 SUGR SUGAR CREEK FINANCIAL CORP IL OTC BB 12.60 (10.0) 0.19 115.70 0.00 66.32 74.12 95.09 95.09 10.89 FDLB FIDELITY FEDERAL BANCORP IN OTC PINK 25.00 NM 20.40 842.48 0.00 1.23 2.54 NM NM 2.97 FCAP FIRST CAPITAL IN NASDAQ 41.55 33.4 2.21 228.00 0.88 18.80 18.07 175.32 193.71 18.22 NWIN NORTHWEST INDIANA BANCORP IN OTC BB 42.95 6.0 3.15 320.86 1.15 13.63 15.18 139.72 144.95 13.39 TDCB THIRD CENTURY BANCORP IN OTC BB 13.95 13.4 0.45 107.52 0.22 31.00 25.83 128.69 130.37 12.97 UCBA UNITED COMMUNITY BANCORP IN NASDAQ 27.20 43.5 0.85 130.00 0.39 32.00 27.47 161.14 169.47 20.92 WEIN WEST END INDIANA BANCSHARES IN OTC BB 29.00 (0.2) 0.66 289.03 0.21 43.94 23.20 109.27 112.45 10.03 CFFN CAPITOL FEDERAL FINANCIAL KS NASDAQ 13.16 (7.4) 0.70 66.06 0.89 18.80 21.57 133.33 133.33 19.92 PBSK POAGE BANKSHARES KY NASDAQ 19.66 3.2 (0.72) 128.62 0.24 NM NM 112.92 118.29 15.29 CTUY CENTURY NEXT FINANCIAL CORP LA OTC BB 34.00 17.2 2.48 276.01 0.14 13.71 11.81 133.54 133.54 12.32 FPBF FPB FINANCIAL CORP LA OTC PINK 19.75 7.6 0.93 137.68 0.21 21.24 19.36 144.90 145.22 14.34 HRGG HERITAGE NOLA BANCORP LA OTC PINK 12.48 NM 0.33 68.05 0.00 37.82 36.71 85.13 86.31 18.34 HIBE HIBERNIA BANCORP LA OTC BB 31.90 71.5 0.17 126.03 0.00 NM NM 176.05 176.05 25.31 HFBL HOME FED BANCORP OF LOUISIANA LA NASDAQ 31.45 16.7 1.93 216.37 0.45 16.30 13.79 129.32 129.80 14.54 BHBK BLUE HILLS BANCORP MA NASDAQ 22.20 24.0 0.58 99.43 0.90 38.28 33.64 150.82 155.14 22.33 BLMT BSB BANCORP INC. MA NASDAQ 34.40 17.6 1.72 282.09 0.00 20.00 16.78 181.53 182.59 12.19 HONE HARBORONE BANCORP MA NASDAQ 18.94 (5.1) 0.34 82.66 0.00 55.71 61.10 179.19 200.42 22.91 HIFS HINGHAM INSTITUTION FOR SAVINGS MA NASDAQ 219.70 20.8 13.39 1,050.38 1.00 16.41 16.17 251.69 251.69 20.92 EBSB MERIDIAN BANCORP MA NASDAQ 19.15 13.3 0.85 101.00 0.18 22.53 22.01 157.87 163.68 18.96 PLRM PILGRIM BANCSHARES MA OTC BB 20.15 8.9 0.58 116.00 0.30 34.74 28.38 134.69 134.69 17.37 PVBC PROVIDENT BANCORP MA NASDAQ 26.20 16.4 0.84 92.51 0.00 31.19 39.10 214.93 214.93 28.32 RNDB RANDOLPH BANCORP MA NASDAQ 16.80 5.7 (0.37) 88.48 0.00 NM NM 126.79 138.39 18.99

  

   

 

 

 

Page 3 KELLER & COMPANY Dublin, Ohio 614-766-1426 SHARE DATA AND PRICING RATIOS PUBLICLY-TRADED, FDIC-INSURED SAVINGS INSTITUTIONS (EXCLUDING MUTUAL HOLDING COMPANIES) PRICES AS OF JUNE 30, 2018 ALL RATIOS/FINANCIAL DATA AS OF MOST RECENT FOUR QUARTERS PER SHARE PRICING RATIOS 52 Week Earnings 12 Month Price/Net Price/Core Price/ Price/Tang. Price/ Price Change (EPS) Assets Div. Earnings Earnings Book Value Book Value Assets State Exchange ($) (%) ($) ($) ($) (X) (X) (X) (X) (X) WEBK WELLESLEY BANCORP MA NASDAQ 33.83 22.1 1.98 326.98 0.20 17.09 14.04 141.08 141.31 10.35 WNEB WESTERN NEW ENGLAND BANCORP MA NASDAQ 11.00 8.4 0.36 69.20 0.13 30.56 21.57 136.65 146.86 15.90 IFSB COLOMBO BANK MD OTC PINK 0.10 (75.0) 0.80 125.42 0.00 0.13 0.12 NM NM 0.08 HBK HAMILTON BANCORP MD NASDAQ 15.70 4.7 (0.18) 154.29 0.00 NM 31.40 104.53 127.33 10.18 MBCQ MB BANCORP MD OTC BB 16.60 10.3 0.01 7.65 0.00 NM NM NM NM NM SVBI SEVERN BANCORP MD NASDAQ 8.65 19.3 0.31 65.42 0.03 27.90 17.65 114.57 116.73 13.22 FBC FLAGSTAR BANCORP Ml NYSE 34.26 11.2 1.33 308.99 0.00 25.76 12.32 137.81 176.14 11.09 NWBB NEW BANCORP Ml OTC BB 19.50 38.4 1.79 168.95 0.00 10.89 10.54 90.82 97.60 11.54 SBT STERLING BANCORP Ml NASDAQ 13.36 NM 0.81 57.31 0.06 16.49 14.68 245.59 253.03 23.31 STBI STURGIS BANCORP Ml OTC BB 19.10 15.8 1.44 182.13 0.50 13.26 14.15 117.25 143.29 10.49 HMNF HMN FINANCIAL MN NASDAQ 20.10 14.5 1.12 160.31 0.00 17.95 15.83 110.32 114.33 12.54 REDW REDWOOD FINANCIAL MN OTC PINK 54.00 20.0 7.39 673.00 0.45 7.31 8.49 68.01 81.30 8.02 CCFC CCSB FINANCIAL CORP MO OTC PINK 13.20 9.1 0.53 107.56 0.10 24.91 24.91 112.82 113.50 12.27 CFDB CENTRAL FEDERAL S&L ASSN OF ROLLA MO OTC PINK 14.40 8.7 0.07 40.54 0.00 NM NM 92.72 92.72 35.52 NASB NASB FINANCIAL MO OTC BB 41.19 13.6 3.66 258.71 1.46 11.25 11.22 135.81 146.12 15.92 QRRY QUARRY CITY S&L ASSN MO OTC BB 15.50 5.1 0.67 131.58 0.00 23.13 20.13 72.60 74.95 11.78 KSBI KS BANCORP NC OTC BB 28.00 18.4 1.92 286.67 0.17 14.58 10.89 105.26 105.26 9.77 LSFG LIFESTORE FINANCIAL GROUP NC OTC PINK 26.00 18.2 1.83 272.02 0.00 14.21 12.32 95.80 98.75 9.56 UBNC UNION BANK NC OTC PINK 16.40 NM 0.60 121.63 0.09 27.33 19.76 129.85 166.16 13.48 EQFN EQUITABLE FINANCIAL CORP NE NASDAQ 10.76 5.0 0.34 92.12 0.00 31.65 26.90 100.09 106.96 11.68 MCBK MADISON COUNTY FINANCIAL NE OTC PINK 26.00 13.0 1.24 122.58 0.40 20.97 16.15 119.43 124.58 21.21 ISBC INVESTORS BANCORP NJ NASDAQ 12.79 (4.8) 0.46 83.61 0.34 27.80 20.30 124.78 129.06 15.30 KRNY KEARNY FINANCIAL CORP NJ NASDAQ 13.45 (9.4) 0.21 62.64 0.24 64.05 56.04 106.92 120.09 21.47

  

   

 

 

 

Page 4 KELLER & COMPANY Dublin, Ohio 614-766-1426 SHARE DATA AND PRICING RATIOS PUBLICLY-TRADED, FDIC-INSURED SAVINGS INSTITUTIONS (EXCLUDING MUTUAL HOLDING COMPANIES) PRICES AS OF JUNE 30, 2018 ALL RATIOS/FINANCIAL DATA AS OF MOST RECENT FOUR QUARTERS PER SHARE PRICING RATIOS State Exchange Price ($) 52 Week Change (%) Earnings (EPS) ($) Assets ($) 12 Month Div. ($) Price/Net Earnings (X) Price/Core Earnings (X) Price/ Book Value (X) Price/Tang. Book Value (X) Price/ Assets (X) MGYR MAGYAR BANCORP NJ NASDAQ 12.88 (1.8) 0.28 104.42 0.00 46.00 33.03 149.94 149.94 12.33 MSBF MB BANCORP NJ NASDAQ 21.50 23.2 0.60 102.09 0.43 35.83 27.92 170.23 170.23 21.06 NFBK NORTHFIELD BANCORP NJ NASDAQ 16.62 (3.1) 0.51 82.83 0.36 32.59 22.46 126.97 135.34 20.07 OCFC OCEANFIRST FINANCIAL CORP NJ NASDAQ 29.96 10.5 0.75 155.93 0.60 39.95 33.29 143.08 221.76 19.21 ORIT ORITANI FINANCIAL CORP NJ NASDAQ 16.20 (5.0) 0.69 88.89 1.23 23.48 17.80 136.13 136.13 18.22 PFS PROVIDENT FINANCIAL SERVICES NJ NYSE 27.53 8.5 1.47 145.88 0.94 18.73 17.88 140.75 207.46 18.87 BCTF BANCORP 34 NM NASDAQ 15.45 10.0 0.35 100.58 0.00 44.14 15.45 105.53 106.40 15.36 CARV CARVER BANCORP NY NASDAQ 4.63 36.2 2.66 187.71 0.00 1.74 NM NM NM 2.47 DCOM DIME COMMUNITY BANCSHARES NY NASDAQ 19.50 (0.5) 1.48 168.76 0.56 13.18 15.35 120.22 132.74 11.55 ESBK ELMIRA SAVINGS BANK NY NASDAQ 20.43 0.6 1.85 209.33 0.46 11.04 17.03 94.93 125.18 9.76 FSBC FSB COMMUNITY BANKSHARES NY NASDAQ 17.75 20.3 0.37 161.16 0.00 47.97 43.29 110.04 113.27 11.01 NYCB NEW YORK COMMUNITY BANCORP NY NYSE 11.04 (15.9) 0.96 101.26 0.68 11.50 13.97 79.83 124.75 10.90 PCSB PCSB FINANCIAL CORP NY NASDAQ 19.87 NM 0.22 80.19 0.00 90.32 64.10 126.80 129.78 24.78 PDLB PDL COMMUNITY BANCORP NY NASDAQ 15.71 NM 0.08 51.34 0.00 NM NM 174.94 174.94 30.60 SNNF SENECA FIN CORP NY OTC PINK 8.55 NM 0.29 92.13 0.00 29.48 21.38 92.23 92.23 9.28 SNNY SUNNYSIDE BANCORP NY OTC BB 16.12 19.0 (0.40) 106.37 0.00 NM NM 123.24 123.24 15.15 TRST TRUSTCO BANK CORP NY NY NASDAQ 8.90 14.8 0.49 51.17 0.26 18.16 16.48 185.42 185.80 17.39 CNNB CINCINNATI BANCORP OH OTC BB 12.85 31.8 0.58 99.86 0.00 22.16 32.13 115.35 121.80 12.87 CCSB COMM SAVINGS BANCORP OH OTC BB 14.60 NM (0.21) 118.20 0.00 NM NM 71.53 71.53 12.35 CIBN COMMUNITY INVESTORS BANCORP OH OTC PINK 15.50 2.3 1.89 274.54 0.30 8.20 10.62 62.70 65.65 5.65 EFBl EAGLE FIN BANCORP OH NASDAQ 16.35 NM 0.41 81.94 0.00 39.88 65.40 95.89 95.89 19.95 FDEF FIRST DEFIANCE FINANCIAL CORP OH NASDAQ 67.06 27.3 3.82 296.90 1.05 17.55 17.19 180.08 257.23 22.59 FNFI FIRST NILES FINANCIAL OH OTC PINK 9.75 (2.5) 0.36 89.64 0.18 27.08 21.67 97.01 97.01 10.88

  

   

 

 

 

Page 5 KELLER & COMPANY Dublin, Ohio 614-766-1426 SHARE DATA AND PRICING RATIOS PUBLICLY-TRADED, FDIC-INSURED SAVINGS INSTITUTIONS (EXCLUDING MUTUAL HOLDING COMPANIES) PRICES AS OF JUNE 30, 2018 ALL RATIOS/FINANCIAL DATA AS OF MOST RECENT FOUR QUARTERS PER SHARE PRICING RATIOS 52 Week Earnings 12 Month Price/Net Price/Core Price/ Price/Tang. Price/ Price Change (EPS) Assets Div. Earnings Earnings Book Value Book Value Assets State Exchange ($) (%) ($) ($) ($) (X) (X) (X) (X) (X) HCFL HOME CITY FINANCIAL CORP OH OTC PINK 28.90 12.5 2.99 205.23 1.00 9.67 9.60 120.62 120.62 14.08 HLFN HOME LOAN FINANCIAL CORP OH OTC BB 29.00 5.5 2.08 134.16 1.40 13.94 13.94 176.72 177.70 21.62 MWBC MW BANCORP INC OH OTC BB 29.17 45.9 (0.23) 183.17 0.61 NM 51.18 161.52 162.96 15.93 PPSF PEOPLES-SIDNEY FINANCIAL CORP OH OTC PINK 10.10 12.2 0.45 83.37 0.32 22.44 21.96 94.30 94.30 12.11 PFOH PERPETUAL FEDERAL SAVINGS BANK OH OTC PINK 29.24 9.5 2.22 159.91 1.17 13.17 12.39 101.39 101.39 18.29 UCFC UNITED COMMUNITY FINANCIAL CORP OH NASDAQ 10.99 32.3 0.58 54.03 0.14 18.95 18.02 185.02 206.58 20.34 VERF VERSAILLES FINANCIAL CORP OH OTCBB 24.25 9.7 0.62 145.75 0.00 39.11 25.26 88.76 88.76 16.64 WAYN WAYNE SAVINGS BANCSHARES OH OTC BB 18.90 7.9 1.45 163.29 0.28 13.03 12.04 128.05 135.48 11.57 BNCL BENEFICIAL MUTUAL BANCORP PA NASDAQ 16.20 8.0 0.34 76.96 0.49 47.65 30.00 119.91 144.77 21.05 ESSA ESSA BANCORP PA NASDAQ 15.83 7.5 0.40 155.21 0.36 39.58 24.35 104.70 114.79 10.20 HARL HARLEYSVILLE SAVINGS FINANCIAL PA OTC PINK 22.63 1.0 1.74 205.45 0.89 13.01 12.93 121.34 121.34 11.01 NWBI NORTHWEST BANCSHARES PA NASDAQ 17.39 11.4 0.99 93.58 0.65 17.57 22.88 146.88 202.68 18.58 PBIP PRUDENTIAL BANCORP PA NASDAQ 19.30 6.3 0.76 104.95 0.31 25.39 20.53 131.47 138.55 18.39 QNTO QUAINT OAK BANCORP PA OTC PINK 13.35 1.3 0.83 128.06 0.20 16.08 13.22 116.09 121.36 10.42 STND STANDARD FINANCIAL CORP PA OTCBB 30.26 7.1 1.25 203.64 1.43 24.21 20.31 108.89 139.70 14.86 CWAY COASTWAY BANCORP Rl NASDAQ 27.70 35.1 0.66 177.82 0.00 41.97 36.45 169.11 169.21 15.58 FSGB FIRST FEDERAL OF SOUTH CAROLINA SC OTC PINK 10.00 146.9 0.05 3.51 0.00 NM NM NM NM NM CASH META FINANCIAL GROUP SD NASDAQ 97.40 9.4 4.91 443.49 0.52 19.84 17.58 212.94 315.72 21.96 AFCB ATHENS BANCSHARES CORP TN OTC BB 52.15 44.5 2.72 266.30 0.20 19.17 17.62 194.44 206.94 19.58 SFBK SFB BANCORP TN OTC PINK 32.00 (1.8) 0.88 168.78 0.90 36.36 32.65 126.98 129.19 18.96 UNTN UNITED TENNESSEE BANKSHARES TN OTC PINK 22.06 4.8 1.60 248.80 0.54 13.79 10.98 88.38 88.38 8.87 BAFI BANCAFFILIATED TX OTC PINK 109.00 45.3 21.49 2,409.52 0.00 5.07 4.49 46.46 48.70 4.52 TBK TRIUMPH BANCORP TX NASDAQ 40.75 66.0 1.82 163.51 0.00 22.39 19.59 210.59 250.31 24.92

 

   

 

 

 

Page 6 KELLER & COMPANY Dublin, Ohio 614-766-1426 SHARE DATA AND PRICING RATIOS PUBLICLY-TRADED, FDIC-INSURED SAVINGS INSTITUTIONS (EXCLUDING MUTUAL HOLDING COMPANIES) PRICES AS OF JUNE 30, 2018 ALL RATIOS/FINANCIAL DATA AS OF MOST RECENT FOUR QUARTERS PER SHARE PRICING RATIOS 52 Week Earnings 12 Month Price/Net Price/Core Price/ Price/Tang. Price/ Price Change (EPS) Assets Div. Earnings Earnings Book Value Book Value Assets State Exchange ($) (%) ($) ($) ($) (X) (X) (X) (X) (X) ANCB ANCHOR BANCORP WA NASDAQ 26.15 4.4 1.07 193.14 0.00 24.44 13.69 98.05 98.42 13.54 FSBW FS BANCORP WA NASDAQ 63.25 44.5 4.43 282.29 0.42 14.28 15.69 186.36 204.36 22.41 RVSB RIVERVIEW BANCORP WA NASDAQ 8.44 27.1 0.45 51.02 0.03 18.76 15.07 162.93 215.86 16.54 TSBK TIMBERLAND BANCORP WA NASDAQ 37.34 47.8 2.13 135.48 0.54 17.53 17.37 234.11 250.27 27.56 FFBW FFBW, INC Wl NASDAQ 11.09 NM (0.01) 39.41 0.00 NM NM 124.19 124.47 28.14 HWIS HOME BANCORP WISCONSIN Wl OTC PINK 14.00 15.2 (0.07) 159.82 0.00 NM NM 117.45 117.45 8.76 WSBF WATERSTONE FINANCIAL Wl NASDAQ 17.05 (9.5) 0.90 62.62 1.48 18.94 17.58 125.83 126.30 27.23 WBBW WESTBURY BANCORP Wl OTC BB 22.33 NM 0.87 208.12 0.00 25.67 20.30 115.46 116.54 10.73

  

   

 

 

 

Page 7 KELLER & COMPANY Dublin, Ohio 614-766-1426 SHARE DATA AND PRICING RATIOS PUBLICLY-TRADED, FDIC-INSURED SAVINGS INSTITUTIONS (EXCLUDING MUTUAL HOLDING COMPANIES) PRICES AS OF JUNE 30, 2018 ALL RATIOS/FINANCIAL DATA AS OF MOST RECENT FOUR QUARTERS PER SHARE PRICING RATIOS Price ($) 52 Week Change (%) Earnings (EPS) ($) Assets ($) 12 Month Div. ($) Price/Net Earnings (X) Price/Core Earnings (X) Price/ Book Value (X) Price/Tang. Book Value (X) Price/ Assets (X) ALL INSTITUTIONS AVERAGE 24.77 14.09 1.46 182.99 0.32 26.78 23.61 131.40 142.77 15.68 HIGH 219.70 146.90 21.49 2,409.52 1.48 100.00 92.58 277.73 319.08 35.52 LOW 0.10 (75.00) (0.72) 3.51 0.00 0.13 0.12 35.69 35.69 0.08 AVERAGE FOR STATE WI 16.12 2.85 0.42 117.49 0.37 22.31 18.94 120.73 121.19 18.72 AVERAGE BY REGION MID-ATLANTIC 19.01 1.88 0.72 118.26 0.44 26.24 22.10 119.79 140.14 14.95 MIDWEST 21.53 10.53 1.39 177.94 0.33 20.36 20.56 114.17 120.84 14.16 NORTH CENTRAL 28.61 8.27 1.88 194.96 0.37 25.07 14.80 112.75 125.99 17.21 NORTHEAST 27.31 10.73 1.32 173.41 0.24 25.38 22.50 140.19 148.33 16.09 SOUTHEAST 25.47 24.95 1.19 168.26 0.23 17.09 22.82 117.03 133.30 14.57 SOUTHWEST 36.85 29.29 3.69 437.22 0.10 20.08 15.15 128.94 134.54 16.21 WEST 28.85 24.37 1.63 152.26 0.42 26.65 23.39 165.32 175.48 18.50 AVERAGE BY EXCHANGE NYSE 24.28 1.27 1.25 185.38 0.54 18.66 14.72 119.46 169.45 13.62 NASDAQ 26.66 13.23 1.19 149.46 0.32 27.59 24.33 147.19 162.44 18.29 OTC BB 23.07 13.73 1.02 169.18 0.33 17.72 18.53 111.73 116.13 13.19 OTC PINK 22.11 10.50 2.66 281.21 0.27 17.65 15.11 86.28 89.07 11.17

  

   

 

 

 

Page 1 KELLER & COMPANY Dublin, Ohio 614-766-1426 KEY FINANCIAL DATA AND RATIOS PUBLICLY-TRADED FDIC-INSURED SAVINGS INSTITUTIONS MOST RECENT FOUR QUARTERS ASSETS AND EQUITY PROFITABILITY CAPITAL ISSUES Total Total Total Core Core Number of Mkt. Value Assets Equity Tang. Equity ROAA ROAA ROAE ROAE Shares of Shares State ($000) ($000) ($000) (%) (%) (%) (%) Exchange Outstanding ($000) SZBI SOUTHFIRST BANCSHARES AL 88,014 9,739 9,739 0.29 0.39 2.62 3.55 OTC PINK 702,000 3,475 BOFI BOFI HOLDING CA 9,982,320 921,653 911,425 1.64 0.82 16.91 8.47 NASDAQ 62,552,868 2,559,038 BYFC BROADWAY FINANCIAL CORP CA 399,433 47,445 47,426 0.43 0.43 3.81 3.83 NASDAQ 27,418,798 60,321 MLGF MALAGA FINANCIAL CORPORATION CA 1,046,819 128,832 128,832 1.41 1.33 10.97 10.39 OTC BB 6,330,000 197,813 PROV PROVIDENT FINANCIAL HOLDINGS CA 1,176,602 120,600 119,706 0.14 0.25 1.37 2.37 NASDAQ 7,460,804 142,352 FBNK FIRST CONNECTICUT BANCORP CT 3,137,949 276,861 271,455 0.56 0.75 6.27 8.37 NASDAQ 15,984,932 489,139 SIFI SI FINANCIAL GROUP CT 1,598,222 168,919 151,197 0.35 0.49 3.26 4.63 NASDAQ 12,242,434 180,576 UBNK UNITED FINANCIAL BANCORP CT 7,088,214 693,000 560,232 0.81 0.87 8.22 8.89 NASDAQ 50,976,667 893,111 WSFS WSFS FINANCIAL CORP DE 6,987,931 746,279 558,489 0.99 1.23 9.36 11.63 NASDAQ 32,003,414 1,705,782 ABCB AMERIS BANCORP GA 8,022,828 868,944 640,968 1.02 1.23 9.71 11.69 NASDAQ 38,327,081 2,044,750 CHFN CHARTER FINANCIAL CORP GA 1,659,791 221,587 177,328 0.98 1.00 7.26 7.41 NASDAQ 15,137,631 365,574 CFBI COMM FIRST BANCSHARES GA 292,476 75,649 75,649 0.02 0.31 0.09 1.22 NASDAQ 7,538,250 83,750 TBNK TERRITORIAL BANCORP HI 2,055,724 232,372 232,121 0.78 0.79 6.58 6.64 NASDAQ 9,733,830 301,749 WCFB WCF BANCORP IA 124,421 28,040 27,980 0.20 0.06 0.82 0.24 NASDAQ 2,561,542 23,054 AJSB AJS BANCORP IL 193,870 29,115 29,113 0.06 0.31 0.37 2.09 OTC BB 2,149,860 30,206 AFBA ALLIED FIRST BANCORP IL 83,191 9,839 9,839 (0.28) 0.72 (2.58) 6.55 OTC BB 1,351,892 1,825 BFFI BEN FRANKLIN FINANCIAL IL 101,544 10,357 10,357 (0.60) (0.65) (7.52) (8.13) OTC BB 1,270,000 10,478 BTHT BEST HOMETOWN BANCORP IL 107,949 12,186 12,186 (0.29) (0.24) (2.66) (2.26) OTC PINK 826,208 11,154 GTPS GREAT AMERICAN BANCORP IL 180,924 17,111 15,931 0.37 0.49 3.83 5.08 OTC BB 438,206 13,957 IROQ IF BANCORP IL 619,310 81,613 80,822 0.31 0.34 2.25 2.51 NASDAQ 3,891,408 93,005 JXSB JACKSONVILLE BANCORP IL 323,400 47,769 44,499 0.89 1.10 6.49 8.03 NASDAQ 1,814,467 61,057 MCPH MIDLAND CAPITAL HOLDINGS CORP IL 117,583 10,859 10,859 0.08 0.11 0.84 1.15 OTC PINK 372,600 8,942 OTTW OTTAWA SAVINGS BANCORP IL 267,587 51,256 49,899 0.40 0.75 1.91 3.60 OTC BB 3,415,490 47,407

  

   

 

 

 

Page 2 KELLER & COMPANY Dublin, Ohio 614-766-1426 KEY FINANCIAL DATA AND RATIOS PUBLICLY-TRADED FDIC-INSURED SAVINGS INSTITUTIONS MOST RECENT FOUR QUARTERS ASSETS AND EQUITY PROFITABILITY CAPITAL ISSUES Total Total Total Core Core Number of Mkt. Value Assets Equity Tang. Equity ROAA ROAA ROAE ROAE Shares of Shares State ($000) ($000) ($000) (%) (%) (%) (%) Exchange Outstanding ($000) RYFL ROYAL FINANCIAL IL 429,887 45,207 42,201 0.76 1.07 7.06 9.99 OTC BB 2,507,112 43,749 SUGR SUGAR CREEK FINANCIAL CORP IL 93,119 10,665 10,665 0.16 0.14 1.44 1.27 OTC BB 804,807 10,141 FDLB FIDELITY FEDERAL BANCORP IN 711,698 85,222 83,297 2.64 1.27 22.13 10.68 OTC PINK 844,763 21,119 FCAP FIRST CAPITAL IN 765,381 79,561 72,013 0.98 1.02 9.19 9.57 NASDAQ 3,356,964 139,482 NWIN NORTHWEST INDIANA BANCORP IN 938,508 89,903 86,664 1.00 0.90 10.18 9.15 OTC BB 2,924,978 125,628 TDCB THIRD CENTURY BANCORP IN 152,674 15,390 15,189 0.43 0.51 4.22 4.98 OTC BB 1,420,000 19,809 UCBA UNITED COMMUNITY BANCORP IN 548,302 71,175 67,681 0.66 0.78 5.02 5.85 NASDAQ 4,217,619 114,719 WEIN WEST END INDIANA BANCSHARES IN 308,356 28,315 27,510 0.23 0.44 2.45 4.67 OTC BB 1,066,858 30,939 CFFN CAPITOL FEDERAL FINANCIAL KS 9,133,171 1,364,740 1,364,272 1.07 0.93 7.14 6.22 NASDAQ 138,250,235 1,819,373 PBSK POAGE BANKSHARES KY 450,159 60,937 58,150 (0.56) (0.61) (3.95) (4.36) NASDAQ 3,499,846 68,807 CTUY CENTURY NEXT FINANCIAL CORP LA 289,806 26,734 26,734 0.94 1.09 10.12 11.74 OTC BB 1,050,000 35,700 FPBF FPB FINANCIAL CORP LA 364,858 36,122 36,044 0.71 0.78 7.60 8.31 OTC PINK 2,650,000 52,338 HRGG HERITAGE NOLA BANCORP LA 112,497 24,239 23,898 0.48 0.50 2.66 2.77 OTC PINK 1,653,125 20,631 HIBE HIBERNIA BANCORP LA 130,147 18,708 18,708 0.13 0.24 0.91 1.67 OTC BB 1,032,667 32,942 HFBL HOME FED BANCORP OF LOUISIANA LA 412,960 46,410 46,242 0.88 1.04 7.98 9.43 NASDAQ 1,908,581 60,025 BHBK BLUE HILLS BANCORP MA 2,670,738 395,444 384,280 0.60 0.68 4.08 4.61 NASDAQ 26,861,521 596,326 BLMT BSB BANCORP INC. MA 2,747,954 184,565 183,512 0.65 0.77 9.45 11.27 NASDAQ 9,741,471 335,107 HONE HARBORONE BANCORP MA 2,696,517 344,857 308,399 0.42 0.39 3.23 3.00 NASDAQ 32,622,695 617,874 HIFS HINGHAM INSTITUTION FOR SAVINGS MA 2,240,198 186,158 186,158 1.29 1.31 15.76 15.99 NASDAQ 2,132,750 468,565 EBSB MERIDIAN BANCORP MA 5,460,900 655,607 632,505 0.89 0.91 7.11 7.32 NASDAQ 54,068,874 1,035,419 PLRM PILGRIM BANCSHARES MA 262,741 33,890 33,890 0.50 0.61 3.89 4.74 OTC BB 2,264,950 45,639 PVBC PROVIDENT BANCORP MA 890,772 117,330 117,330 0.90 0.72 7.00 5.56 NASDAQ 9,628,496 252,267 RNDB RANDOLPH BANCORP MA 533,539 79,871 73,190 (0.43) (0.48) (2.72) (3.06) NASDAQ 6,029,776 101,300

 

   

 

 

 

Page 3 KELLER & COMPANY Dublin, Ohio 614-766-1426 KEY FINANCIAL DATA AND RATIOS PUBLICLY-TRADED FDIC-INSURED SAVINGS INSTITUTIONS MOST RECENT FOUR QUARTERS ASSETS AND EQUITY PROFITABILITY CAPITAL ISSUES Total Total Total Core Core Number of Mkt. Value Assets Equity Tang. Equity ROAA ROAA ROAE ROAE Shares of Shares State ($000) ($000) ($000) (%) (%) (%) (%) Exchange Outstanding ($000) WEBK WELLESLEY BANCORP MA 819,586 60,103 60,002 0.64 0.77 8.41 10.23 NASDAQ 2,506,532 84,796 WNEB WESTERN NEW ENGLAND BANCORP MA 2,085,531 242,623 225,832 0.52 0.75 4.32 6.25 NASDAQ 30,138,083 331,519 IFSB COLOMBO BANK MD 194,655 21,367 21,367 0.62 0.63 5.90 6.03 OTC PINK 1,552,000 155 HBK HAMILTON BANCORP MD 526,310 51,228 42,052 (0.12) 0.33 (1.03) 2.92 NASDAQ 3,411,075 53,554 MBCQ MB BANCORP MD 148,391 30,128 30,128 0.17 (0.40) 0.80 (1.88) OTC BB 19,400,200 322,043 SVBI SEVERN BANCORP MD 801,183 92,417 90,814 0.47 0.75 4.38 6.92 NASDAQ 12,247,626 105,942 FBC FLAGSTAR BANCORP Ml 17,735,862 1,427,000 1,116,713 0.45 0.95 5.37 11.24 NYSE 57,399,993 1,966,524 NWBB NEW BANCORP Ml 121,562 15,447 14,373 1.04 1.07 8.47 8.73 OTC BB 719,531 14,031 SBT STERLING BANCORP Ml 3,037,848 288,512 279,944 1.55 1.74 18.58 20.91 NASDAQ 53,002,963 708,120 STBI STURGIS BANCORP Ml 444,409 39,742 32,519 0.84 0.79 9.11 8.49 OTC BB 2,440,000 46,604 HMNF HMN FINANCIAL MN 722,080 82,056 79,200 0.70 0.79 6.28 7.09 NASDAQ 4,504,234 90,535 REDW REDWOOD FINANCIAL MN 295,144 34,822 29,127 1.12 0.96 9.56 8.23 OTC PINK 438,551 23,682 CCFC CCSB FINANCIAL CORP MO 98,629 10,733 10,668 0.50 0.50 4.59 4.57 OTC PINK 917,000 12,104 CFDB CENTRAL FEDERAL S&L ASSN OF ROLLA MO 67,707 25,936 25,936 0.17 0.17 0.43 0.43 OTC PINK 1,670,220 24,051 NASB NASB FINANCIAL MO 1,910,516 223,978 208,163 1.34 1.35 11.75 11.77 OTC BB 7,384,851 304,182 QRRY QUARRY CITY S&L ASSN MO 53,646 8,703 8,433 0.51 0.59 3.17 3.68 OTC BB 407,691 6,319 KSBI KS BANCORP NC 375,395 34,827 34,827 0.68 0.91 7.04 9.42 OTC BB 1,309,500 36,666 LSFG LIFESTORE FINANCIAL GROUP NC 285,617 28,495 27,650 0.69 0.79 6.71 7.74 OTC PINK 1,050,000 27,300 UBNC UNION BANK NC 707,429 73,441 57,389 0.56 0.77 5.38 7.49 OTC PINK 5,816,138 95,385 EQFN EQUITABLE FINANCIAL CORP NE 305,633 35,659 33,360 0.41 0.49 3.13 3.72 NASDAQ 3,317,670 35,698 MCBK MADISON COUNTY FINANCIAL NE 384,889 68,360 65,526 1.02 1.32 5.77 7.51 OTC PINK 3,140,000 81,640 ISBC INVESTORS BANCORP NJ 25,232,421 3,092,081 2,990,473 0.56 0.76 4.43 6.03 NASDAQ 301,796,438 3,859,976 KRNY KEARNY FINANCIAL CORP NJ 4,933,700 991,201 882,037 0.34 0.38 1.61 1.83 NASDAQ 78,765,003 1,059,389

  

   

 

 

 

Page 4 KELLER & COMPANY Dublin, Ohio 614-766-1426 KEY FINANCIAL DATA AND RATIOS PUBLICLY-TRADED FDIC-INSURED SAVINGS INSTITUTIONS MOST RECENT FOUR QUARTERS ASSETS AND EQUITY PROFITABILITY CAPITAL ISSUES Total Total Total Core Core Number of Mkt. Value Assets Equity Tang. Equity ROAA ROAA ROAE ROAE Shares of Shares State ($000) ($000) ($000) (%) (%) (%) (%) Exchange Outstanding ($000) MGYR MAGYAR BANCORP NJ 607,831 50,027 49,974 0.27 0.38 3.28 4.59 NASDAQ 5,820,746 74,971 MSBF MB BANCORP NJ 563,980 69,759 69,759 0.61 0.79 4.84 6.19 NASDAQ 5,524,095 118,768 NFBK NORTHFIELD BANCORP NJ 4,069,209 642,926 603,110 0.63 0.92 3.94 5.68 NASDAQ 49,126,879 816,489 OCFC OCEANFIRST FINANCIAL CORP NJ 7,501,048 1,007,460 649,856 0.61 0.73 5.14 6.18 NASDAQ 48,105,623 1,441,244 ORIT ORITANI FINANCIAL CORP NJ 4,142,777 554,691 554,691 0.78 1.02 5.80 7.59 NASDAQ 46,604,276 754,989 PFS PROVIDENT FINANCIAL SERVICES NJ 9,734,242 1,305,035 885,315 1.02 1.07 7.58 7.94 NYSE 66,729,095 1,837,052 BCTF BANCORP 34 NM 340,840 49,618 49,216 0.34 0.99 2.33 6.69 NASDAQ 3,388,601 52,354 CARV CARVER BANCORP NY 694,186 55,589 55,408 1.47 (0.64) 20.22 (8.81) NASDAQ 3,698,247 17,123 DCOM DIME COMMUNITY BANCSHARES NY 6,325,917 607,957 550,812 0.87 0.75 9.35 8.05 NASDAQ 37,484,270 730,943 ESBK ELMIRA SAVINGS BANK NY 553,389 56,886 43,134 0.87 0.57 8.03 5.21 NASDAQ 2,643,652 54,010 FSBC FSB COMMUNITY BANKSHARES NY 312,853 31,315 30,421 0.24 0.26 2.28 2.51 NASDAQ 1,941,253 34,457 NYCB NEW YORK COMMUNITY BANCORP NY 49,654,874 6,780,717 4,339,399 0.96 0.79 6.93 5.74 NYSE 490,379,532 5,413,790 PCSB PCSB FINANCIAL CORP NY 1,456,724 284,680 278,111 0.28 0.39 1.43 1.97 NASDAQ 18,165,110 360,941 PDLB PDL COMMUNITY BANCORP NY 947,938 165,714 165,714 0.16 0.28 0.99 1.69 NASDAQ 18,463,028 290,054 SNNF SENECA FIN CORP NY 182,328 18,338 18,338 0.32 0.45 3.78 5.26 OTC PINK 1,978,923 16,920 SNNY SUNNYSIDE BANCORP NY 84,406 10,382 10,382 (0.37) (0.04) (2.93) (0.30) OTC BB 793,500 12,791 TRST TRUSTCO BANK CORP NY NY 4,930,915 462,097 461,544 0.96 1.06 10.32 11.38 NASDAQ 96,358,600 857,592 CNNB CINCINNATI BANCORP OH 175,051 19,527 18,490 0.60 0.42 5.33 3.66 OTC BB 1,752,947 22,525 CCSB COMM SAVINGS BANCORP OH 52,160 9,006 9,006 (0.18) (0.35) (1.05) (2.02) OTC BB 441,290 6,443 CIBN COMMUNITY INVESTORS BANCORP OH 144,133 12,980 12,397 0.69 0.53 7.76 6.00 OTC PINK 525,000 8,138 EFBI EAGLE FIN BANCORP OH 132,160 27,491 27,491 0.51 0.31 2.79 1.68 NASDAQ 1,612,808 26,369 FDEF FIRST DEFIANCE FINANCIAL CORP OH 3,022,984 379,214 265,439 1.31 1.34 10.49 10.71 NASDAQ 10,181,899 682,798 FNFI FIRST NILES FINANCIAL OH 99,784 11,186 11,186 0.41 0.52 3.34 4.25 OTC PINK 1,113,172 10,853

 

   

 

 

 

Page 5 KELLER & COMPANY Dublin, Ohio 614-766-1426 KEY FINANCIAL DATA AND RATIOS PUBLICLY-TRADED FDIC-INSURED SAVINGS INSTITUTIONS MOST RECENT FOUR QUARTERS ASSETS AND EQUITY PROFITABILITY CAPITAL ISSUES State Total Assets ($000) Total Equity ($000) Total Tang. Equity ($000) ROAA (%) Core ROAA (%) ROAE (%) Core ROAE (%) Exchange Number of Shares Outstanding Mkt. Value of Shares ($000) HCFL HOME CITY FINANCIAL CORP OH 167,636 19,575 19,575 1.47 1.48 12.91 12.99 OTC PINK 816,818 23,606 HLFN HOME LOAN FINANCIAL CORP OH 201,246 24,610 24,482 1.49 1.49 13.27 13.28 OTC BB 1,500,000 43,500 MWBC MW BANCORP INC OH 163,242 16,091 15,956 (0.13) 0.33 (1.22) 3.05 OTC BB 891,209 25,997 PPSF PEOPLES-SIDNEY FINANCIAL CORP OH 113,378 14,565 14,565 0.55 0.57 4.13 4.22 OTC PINK 1,360,000 13,736 PFOH PERPETUAL FEDERAL SAVINGS BANK OH 394,980 71,248 71,248 1.39 1.48 7.84 8.34 OTC PINK 2,470,032 72,224 UCFC UNITED COMMUNITY FINANCIAL CORP OH 2,695,178 296,195 265,250 1.10 1.15 9.87 10.39 NASDAQ 49,882,491 548,209 VERF VERSAILLES FINANCIAL CORP OH 56,530 10,598 10,598 0.43 0.67 2.30 3.53 OTC BB 387,867 9,406 WAYN WAYNE SAVINGS BANCSHARES OH 454,254 41,060 38,799 0.90 0.98 9.66 10.49 OTC BB 2,781,839 52,577 BNCL BENEFICIAL MUTUAL BANCORP PA 5,792,663 1,016,636 842,514 0.44 0.70 2.46 3.95 NASDAQ 75,264,135 1,219,279 ESSA ESSA BANCORP PA 1,820,924 177,378 161,792 0.26 0.43 2.63 4.26 NASDAQ 11,732,222 185,721 HARL HARLEYSVILLE SAVINGS FINANCIAL PA 774,997 70,366 70,366 0.85 0.85 9.46 9.54 OTC PINK 3,772,166 85,364 NWBI NORTHWEST BANCSHARES PA 9,601,600 1,215,254 880,496 1.07 0.82 8.43 6.47 NASDAQ 102,599,662 1,784,208 PBIP PRUDENTIAL BANCORP PA 944,329 132,060 125,319 0.75 0.93 5.11 6.33 NASDAQ 8,998,235 173,666 ONTO QUAINT OAK BANCORP PA 250,300 22,485 21,502 0.68 0.84 7.30 8.97 OTC PINK 1,954,571 26,094 STND STANDARD FINANCIAL CORP PA 976,781 133,310 103,915 0.61 0.73 4.50 5.38 OTC BB 4,796,643 145,146 CWAY COASTWAY BANCORP Rl 779,976 71,868 71,815 0.40 0.46 4.07 4.68 NASDAQ 4,386,351 121,502 FSGB FIRST FEDERAL OF SOUTH CAROLINA SC 84,378 6,039 5,659 1.30 1.35 18.54 19.26 OTC PINK 24,066,545 240,665 CASH META FINANCIAL GROUP SD 4,301,708 443,703 299,256 1.00 1.13 10.91 12.30 NASDAQ 9,699,591 944,740 AFCB ATHENS BANCSHARES CORP TN 482,009 48,553 45,613 1.05 1.15 10.00 10.92 OTC BB 1,810,000 94,392 SFBK SFB BANCORP TN 67,005 10,006 9,832 0.54 0.60 3.49 3.87 OTC PINK 397,000 12,704 UNTN UNITED TENNESSEE BANKSHARES TN 205,755 20,645 20,645 0.65 0.81 6.28 7.87 OTC PINK 827,000 18,244 BAFI BANCAFFILIATED TX 670,930 65,325 62,329 0.95 1.07 9.36 10.57 OTC PINK 278,450 30,351 TBK TRIUMPH BANCORP TX 3,405,010 402.944 339,021 1.20 1.37 10.14 11.61 NASDAQ 20,824,509 848,599

 

   

 

 

Page 6 KELLER & COMPANY Dublin, Ohio 614-766-1426 KEY FINANCIAL DATA AND RATIOS PUBLICLY-TRADED FDIC-INSURED SAVINGS INSTITUTIONS MOST RECENT FOUR QUARTERS ASSETS AND EQUITY PROFITABILITY CAPITAL ISSUES Total Total Total Core Core Number of Mkt. Value Assets Equity Tang. Equity ROAA ROAA ROAE ROAE Shares of Shares State ($000) ($000) ($000) (%) (%) (%) (%) Exchange Outstanding ($000) ANCB ANCHOR BANCORP WA 479,755 66,253 65,996 0.57 1.01 4.03 7.18 NASDAQ 2,484,030 64,957 FSBW FS BANCORP WA 1,043,205 125,442 114,374 1.66 1.51 14.40 13.10 NASDAQ 3,695,552 233,744 RVSB RIVERVIEW BANCORP WA 1,151,535 116,901 88,334 0.90 1.12 8.82 10.96 NASDAQ 22,570,179 190,492 TSBK TIMBERLAND BANCORP WA 1,001,201 117,843 110,283 1.63 1.64 13.97 14.10 NASDAQ 7,390,227 275,951 FFBW FFBW, INC Wl 260,573 59,039 58,940 (0.02) 0.07 (0.13) 0.41 NASDAQ 6,612,500 73,333 HWIS HOME BANCORP WISCONSIN Wl 143,707 10,715 10,715 (0.04) (0.05) (0.59) (0.61) OTC PINK 899,190 12,589 WSBF WATERSTONE FINANCIAL Wl 1,836,338 397,419 395,839 1.43 1.54 6.47 6.97 NASDAQ 29,323,807 499,971 WBBW WESTBURY BANCORP Wl 801,259 74,453 73,748 0.42 0.53 4.37 5.57 OTC BB 3,850,000 85,971

 

 

   

 

 

Page 7 KELLER & COMPANY Dublin, Ohio 614-766-1426 KEY FINANCIAL DATA AND RATIOS PUBLICLY-TRADED FDIC-INSURED SAVINGS INSTITUTIONS MOST RECENT FOUR QUARTERS ASSETS AND EQUITY PROFITABILITY CAPITAL ISSUES Total Assets ($000) Total Equity ($000) Total Tang. Equity ($000) ROAA (%) Core ROAA (%) ROAE (%) Core ROAE (%) Exchange Number of Shares Outstanding Mkt. Value of Shares ($000) ALL INSTITUTIONS AVERAGE 2,245,051 273,993 227,960 0.84 0.87 6.82 7.06 20,565,278 377,766 MEDIAN 548,302 66,253 62,329 0.61 0.75 5.33 6.19 3,499,846 83,750 HIGH 49,654,874 6,780,717 4,339,399 2.64 1.74 22.13 20.91 490,379,532 5,413,790 LOW 52,160 6,039 5,659 (0.60) (0.65) (7.52) (8.81) 278,450 155 AVERAGE FOR STATE Wl 760,469 135,407 134,811 0.97 1.07 5.46 6.05 10,171,374 167,966 AVERAGE BY REGION MID-ATLANTIC 4,280,264 571,104 481,698 0.69 0.82 5.18 6.12 44,010,205 788,492 MIDWEST 966,193 100,554 87,854 0.77 1.01 7.24 9.56 6,653,461 145,149 NORTH CENTRAL 1,581,595 211,521 195,629 1.04 1.01 8.03 7.82 15,662,871 305,943 NORTHEAST 4,089,849 499,365 383,878 0.85 0.77 6.86 6.25 38,812,152 555,907 SOUTHEAST 1,115,518 127,084 100,482 0.94 1.11 8.33 9.90 8,816,468 274,810 SOUTHWEST 715,881 83,763 75,274 1.00 1.19 8.63 10.20 4,098,242 141,618 WEST 2,037,399 208,593 202,055 1.32 0.91 12.43 8.59 16,626,254 447,380 AVERAGE BY EXCHANGE NYSE 25,708,326 3,170,917 2,113,809 0.85 0.86 6.78 6.87 204,836,207 3,072,455 NASDAQ 2,831,254 345,900 308,604 0.83 0.87 6.77 7.09 27,722,424 537,805 OTC 366,001 41,858 39,499 0.83 0.89 7.14 7.70 2,623,130 62,494 OTC PINK 262,922 30,577 29,309 0.94 0.88 8.12 7.60 2,388,134 36,672

 

 

   

 

 

EXHIBIT 32 Page 1 KELLER & COMPANY Dublin, Ohio 614-766-1426 SHARE DATA AND PRICING RATIOS PUBLICLY-TRADED, FDIC-INSURED MUTUAL HOLDING COMPANIES PRICES AS OF JUNE 30, 2018 ALL RATIOS/FINANCIAL DATA AS OF MOST RECENT FOUR QUARTERS PER SHARE PRICING RATOS 52 Week Earnings 12 Month Price/Net Price/Core Price/ Price/Tang. Price/ Price Change (EPS) Assets Div. Earnings Earnings Book Value Book Value Assets State Exchange ($) (%) ($) ($) ($) (X) (X) (X) (X) (X) CULL CULLMAN BANCORP (MHC) AL OTC BB 24.65 7.2 1.27 124.43 0.00 19.41 17.48 136.26 136.26 19.81 PBBI PUTNAM BANCORP, INC (MHC) CT NASDAQ 11.35 NM 0.36 72.83 0.12 31.53 31.53 96.60 105.29 15.58 CFBI COMMUNITY FIRST BANCSHARES, INC (MH GA NASDAQ 11.11 NM 0.01 38.80 0.00 NM NM 110.66 110.66 28.63 MFDB MUTUAL FEDERAL BANCORP (MHC) IL OTC BB 5.25 (4.5) 0.01 25.16 0.00 NM 7.72 131.25 131.25 20.87 KFFB KENTUCKY FIRST FED BANCORP (MHC) KY NASDAQ 8.45 (10.5) 0.21 37.10 0.40 40.24 46.94 105.76 134.77 22.78 BVFL BV FINANCIAL (MHC) MD OTC BB 11.25 42.6 0.05 56.00 0.00 NM 48.91 163.52 164.71 20.09 ABBB AUBURN BANCORP (MHC) ME OTC BB 12.50 10.6 0.67 149.38 0.00 18.66 17.86 92.59 93.01 8.37 LBCP LIBERTY BANCORP (MHC) MO OTC BB 25.02 14.0 1.33 130.41 0.44 18.81 22.75 175.70 186.30 19.19 WAKE WAKE FOREST BANCSHARES (MHC) NC OTC PINK 20.50 15.5 0.72 90.31 0.25 28.47 22.53 101.33 101.33 22.70 ISBC INVESTORS BANCORP (MHC) NJ NASDAQ 12.79 (4.8) 0.46 83.61 0.34 27.80 20.30 124.78 129.06 15.30 LPBC LINCOLN PARK BANCORP (MHC) NJ OTC BB 12.75 7.6 0.04 198.92 0.00 NM 3.91 118.94 119.27 6.41 MGYR MAGYAR BANCORP (MHC) NJ NASDAQ 12.88 (1.8) 0.28 104.42 0.00 46.00 NM 149.94 149.94 12.33 FSBC FSB COMMUNITY BANKSHARES NY NASDAQ 17.75 20.3 0.37 161.16 0.00 47.97 43.29 110.04 113.27 11.01 GOVB GOUVERNEUR BANCORP, (MHC) NY OTC PINK 15.90 7.8 0.50 61.03 0.68 31.80 2.70 117.17 117.17 26.05 GCBC GREENE COUNTY BANCORP (MHC) NY NASDAQ 33.90 24.6 1.50 137.39 0.58 22.60 NM 311.87 311.87 24.67 LSBK LAKE SHORE BANCORP INC (MHC) NY NASDAQ 17.15 8.9 0.61 87.26 0.34 28.11 NM 133.26 133.26 19.65 NECB NORTHEAST COMM BANCORP (MHC) NY OTC BB 11.01 30.1 0.81 68.86 0.12 13.59 11.97 122.61 123.43 15.99 SCAY SENECA-CAYUGA BANCORP (MHC) NY OTC PINK 12.24 14.4 0.43 119.40 0.00 28.47 29.85 110.97 114.61 10.25 GVFF GREENVILLE FED FINANCIAL CORP (MHC) OH OTC BB 10.00 5.3 0.47 84.19 0.28 21.28 22.73 109.65 112.74 11.88 TFSL TFS FINANCIAL CORPORATION (MHC) OH NASDAQ 15.77 1.9 0.32 49.61 0.64 49.28 47.79 256.01 258.10 31.79 WMPN WILLIAM PENN BANCORP (MHC) PA OTC BB 30.50 26.8 0.46 87.84 0.00 66.30 43.57 174.68 174.68 34.72 OFED OCONEE FEDERAL FINANCIAL CORP (MHC) SC NASDAQ 28.94 5.2 0.69 84.34 0.40 41.94 37.10 196.74 206.86 34.31 FFBW FFBW, INC (MHC) Wl NASDAQ 11.09 NM (0.01) 39.41 0.00 NM NM 124.19 124.47 28.14

 

 

   

 

 

Page 2 KELLER & COMPANY Dublin, Ohio 614-766-1426 SHARE DATA AND PRICING RATIOS PUBLICLY-TRADED, FDIC-INSURED MUTUAL HOLDING COMPANIES PRICES AS OF JUNE 30, 2018 ALL RATIOS/FINANCIAL DATA AS OF MOST RECENT FOUR QUARTERS PER SHARE PRICING RATIOS Price ($) 52 Week Change (%) Earnings (EPS) ($) Assets (3) 12 Month Div. (3) Price/Net Earnings (X) Price/Core Earnings (X) Price/ Book Value (X) Price/Tang. Book Value (X) Price/ Assets (X) ALL INSTITUTIONS AVERAGE 16.21 11.06 0.50 90.95 0.20 32.35 26.61 142.37 145.75 20.02 HIGH 33.90 42.60 1.50 198.92 0.68 66.30 48.91 311.87 311.87 34.72 LOW 5.25 (10.50) (0.01) 25.16 0.00 13.59 2.70 92.59 93.01 6.41 AVERAGE FOR STATE Wl 11.09 N/A (0.01) 39.41 0.00 N/A N/A 124.19 124.47 28.14 AVERAGE BY REGION MID-ATLANTIC 16.03 14.08 0.26 106.16 0.07 28.02 23.34 146.37 147.53 17.77 MIDWEST 10.11 (1.56) 0.20 47.09 0.26 22.16 25.04 145.37 152.27 23.09 NORTH CENTRAL 25.02 14.00 1.33 130.41 0.44 18.81 22.75 175.70 186.30 19.19 NORTHEAST 16.48 14.59 0.66 107.16 0.23 27.84 17.15 136.89 138.99 16.45 SOUTHEAST 21.30 6.98 0.67 84.47 0.16 22.46 19.28 136.25 138.78 26.36 AVERAGE BY EXCHANGE NASDAQ 16.47 3.98 0.44 81.45 0.26 30.50 20.63 156.35 161.59 22.20 OTC BB 15.88 15.52 0.57 102.80 0.09 17.56 21.88 136.13 137.96 17.48 OTC PINK 16.21 12.57 0.55 90.25 0.31 29.58 18.36 109.82 111.04 19.67

 

 

   

 

 

 

EXHIBIT 33 Page 1 KELLER & COMPANY Dublin, Ohio 614-766-1426 KEY FINANCIAL DATA AND RATIOS PUBLICLY-TRADED FDIC-INSURED MUTUAL HOLDING COMPANIES MOST RECENT FOUR QUARTERS ASSETS AND EQUITY PROFITABILITY CAPITAL ISSUES State Total Assets ($000) Total Equity ($000) Total Tang. Equity ($000) ROAA (%) Core ROAA (%) ROAE (%) Core ROAE (%) Exchange Number of Shares Outstanding Mkt. Value of Shares ($000) CULL CULLMAN BANCORP (MHC) AL 288,673 41,980 41,971 1.04 1.15 7.10 7.90 OTC BB 2,320,000 57,188 PBBI PUTNAM BANCORP, INC (MHC) CT 525,811 84,836 77,836 0.50 0.50 3.06 3.04 NASDAQ 7,220,000 81,947 CFBI COMMUNITY FIRST BANCSHARES, INC (MH GA 292,476 75,649 75,649 0.02 0.01 0.09 0.05 NASDAQ 7,538,250 83,750 MFDB MUTUAL FEDERAL BANCORP (MHC) IL 83,902 13,329 13,329 0.02 2.59 0.13 16.79 OTC BB 3,334,273 17,505 KFFB KENTUCKY FIRST FED BANCORP (MHC) KY 313,273 67,510 52,919 0.57 0.49 2.60 2.25 NASDAQ 8,444,515 71,356 BVFL BV FINANCIAL (MHC) MD 167,454 20,573 20,429 0.08 0.41 0.68 3.31 OTC BB 2,990,000 33,638 ABBB AUBURN BANCORP (MHC) ME 74,147 6,700 6,672 0.46 0.48 5.04 5.22 OTC BB 496,350 6,204 LBCP LIBERTY BANCORP (MHC) MO 469,467 51,257 48,345 1.05 0.86 9.46 7.80 OTC BB 3,600,000 90,072 WAKE WAKE FOREST BANCSHARES (MHC) NC 104,329 23,373 23,373 0.80 1.01 3.60 4.55 OTC PINK 1,155,210 23,682 ISBC INVESTORS BANCORP (MHC) NJ 25,232,421 3,092,081 2,990,473 0.56 0.76 4.43 6.03 NASDAQ 301,796,438 3,859,976 LPBC LINCOLN PARK BANCORP (MHC) NJ 363,194 19,570 19,518 0.02 1.59 0.35 27.51 OTC BB 1,825,845 23,280 MGYR MAGYAR BANCORP (MHC) NJ 607,831 50,027 49,974 0.27 0.00 3.28 0.02 NASDAQ 5,820,746 74,971 FSBC FSB COMMUNITY BANKSHARES NY 312,853 31,315 30,421 0.24 0.26 2.28 2.51 NASDAQ 1,941,253 34,457 GOVB GOUVERNEUR BANCORP, (MHC) NY 132,850 29,551 29,551 0.81 9.45 3.70 43.11 OTC PINK 2,176,908 34,613 GCBC GREENE COUNTY BANCORP (MHC) NY 1,171,449 92,722 92,722 1.21 0.15 14.55 1.75 NASDAQ 8,526,614 289,052 LSBK LAKE SHORE BANCORP INC (MHC) NY 530,012 78,193 78,193 0.72 0.11 4.77 0.73 NASDAQ 6,073,970 104,169 NECB NORTHEAST COMM BANCORP (MHC) NY 823,589 107,460 106,625 1.23 1.41 9.36 10.69 OTC BB 11,960,000 131,680 SCAY SENECA-CAYUGA BANCORP (MHC) NY 284,232 26,251 25,425 0.35 0.34 3.87 3.77 OTC PINK 2,380,500 29,137 GVFF GREENVILLE FED FINANCIAL CORP (MHC) OH 176,796 19,150 18,634 0.57 0.54 5.24 4.94 OTC BB 2,100,000 21,000 TFSL TFS FINANCIAL CORPORATION (MHC) OH 13,921,450 1,729,959 1,715,047 0.65 0.67 5.24 5.39 NASDAQ 280,644,630 4,425,766 WMPN WILLIAM PENN BANCORP (MHC) PA 303,919 60,419 60,419 0.52 0.78 2.67 4.03 OTC BB 3,460,000 105,530 OFED OCONEE FEDERAL FINANCIAL CORP (MHC) SC 484,852 84,582 80,442 0.83 0.93 4.66 5.21 NASDAQ 5,748,653 166,366 FFBW FFBW, INC (MHC) Wl 260,573 59,039 58,940 (0.02) (0.05) (0.13) (0.27) NASDAQ 6,612,500 73,333

 

   

 

 

Page 2 KELLER & COMPANY Dublin, Ohio 614-766-1426 KEY FINANCIAL DATA AND RATIOS PUBLICLY-TRADED FDIC-INSURED MUTUAL HOLDING COMPANIES MOST RECENT FOUR QUARTERS ASSETS AND EQUITY PROFITABILITY CAPITAL ISSUES Total Assets ($000) Total Equity ($000) Total Tang. Equity ($000) ROAA (%) Core ROAA (%) ROAE (%) Core ROAE (%) Exchange Number of Shares Outstanding Mkt. Value of Shares ($000) ALL INSTITUTIONS AVERAGE 2,040,241 255,023 i 248,561 0.60 0.73 4.76 5.77 29,485,507 427,768 MEDIAN 312,853 51,257 49,974 0.56 0.54 3.70 4.55 3,600,000 73,333 HIGH 25,232,421 3,092,081 2,990,473 1.23 9.45 14.55 43.11 301,796,438 4,425,766 LOW 74,147 6,700 6,672 (0.02) (0.05) (0.13) (0.27) 496,350 6,204 AVERAGE FOR STATE WI 260,573 59,039 58,940 (0.02) (0.05) (0.13) (0.27) 6,612,500 73,333 AVERAGE BY REGION MID-ATLANTIC 5,334,964 648,534 628,163 0.54 0.75 4.33 6.03 63,178,606 819,479 MIDWEST 2,951,199 377,797 371,774 0.63 0.66 4.97 5.21 60,227,184 921,792 NORTH CENTRAL 469,467 51,257 48,345 1.05 0.86 9.46 7.80 3,600,000 90,072 NORTHEAST 481,868 57,129 55,931 0.87 0.83 7.14 6.84 5,096,949 88,907 SOUTHEAST 292,583 56,396 55,359 0.68 0.76 3.52 3.97 4,190,528 82,747 AVERAGE BY EXCHANGE NASDAQ 3,968,455 495,083 482,056 0.59 0.68 4.69 5.37 58,215,234 842,286 OTC 305,682 37,826 37,327 0.76 1.14 6.11 9.17 3,565,163 54,011 OTC PINK 173,804 26,392 26,116 0.56 2.80 3.73 18.76 1,904,206 29,144

 

 

   

 

 

 

 EXHIBIT 34 KELLER & COMPANY Dublin, Ohio 614-766-1426 RECENT STANDARD CONVERSIONS PRICE CHANGES FROM IPO DATE January 1, 2017 through August 7, 2018 Percentage Price Change From Initial Trading Date Company Name Ticker Conversion Date Exchange One Day One Week One Month Through 8/07/2018 Community Savings Bancorp CCSB 1/10/2017 OTC MKT 30.00 30.00 30.00 50.00 HV Bancorp, Inc. HVBC 1/12/2017 NASDAQ 36.70 41.30 39.90 51.50 PCSB Financial Corp. PCSB 4/21/2017 NASDAQ 64.60 63.50 63.60 100.10 Community First Bancshares CFBI 4/28/2017 NASDAQ 17.40 33.70 31.50 16.40 Eagle Financial Bancorp EFBI 7/21/2017 NASDAQ 14.92 60.80 60.00 60.00 FFBW, Inc. FFBW 10/11/2017 NASDAQ 15.30 11.00 11.00 12.50 Heritage NOLA Bancorp HRGG 7/13/2017 OTC MKT 15.00 13.50 13.50 23.50 Seneca Financial SNNF 10/12/2017 OTC MKT 18.00 (8.50) (10.00) (9.50) SSB Bancorp SSPB 1/26/2018 OTC MKT (5.50) (7.50) (4.00) (5.00) Columbia Financial CLBK 4/20/2018 NASDAQ 54.20 66.30 70.70 68.40 AVERAGE MEDIAN HIGH LOW 26.06 17.70 64.60 (5.50) % 30.41 % 48.35 66.50 (8.50) 30.62 % 30.75 70.70 (10.00) 36.79 % 73.50 100.10 (9.50)

  

   

 

 

EXHIBIT 35 KELLER & COMPANY Dublin, Ohio 614-766-1426 RECENT ACQUISITIONS AND PENDING ACQUISITIONS COUNTY, CITY OR MARKET AREA OF THE EQUITABLE BANK, S.S.B. NONE (that were potential comparable group candidates)

 

   

 

 

EXHIBIT 36 KELLER & COMPANY Dublin, Ohio (614) 766-1426 COMPARABLE GROUP SELECTION BALANCE SHEET PARAMETERS Most Recent Quarter General Parameters: Regions: Mid-Atlantic, Midwest, North Central, Northeast, Southwest Asset Size: < $950 Million Stock trades on: NASDAQ or NYSE No Recent Acquisition Activity Total Assets ($000) Cash & Securities/ Assets (%) MBS/ Assets (%) 1-4 Fam. Loans/ Assets (%) Total Net Loans/ Assets (%) Total Net Loans & MBS/ Assets (%) Borrowed Funds/ Assets (%) Equity/ Assets (%) EQUITABLE BANK, SSB WI 313,424 8.31 0.37 47.25 86.28 86.65 14.68 4.50 DEFINED PARAMETERS FOR INCLUSION IN COMPARABLE GROUP < 950,000 < 20.00 <16.00 <72.00 60.00- 90.00 75.0- 92.00 < 22.00 5 00- 22.00 SIFI SI FINANCIAL GROUP CT 1,598,222 9.70 4.60 27.05 79.04 83.64 10.87 10.57 CHFN CHARTER FINANCIAL CORP GA 1,659,791 13.85 7.78 21.93 69.51 77.29 3.62 13.35 CFBI COMM FIRST BANCSHARES GA 292,476 10.33 4.54 52.69 77.66 82.20 3.55 25.87 WCFB WCF BANCORP IA 124,421 16.17 21.38 46.62 53.65 75.03 12.28 22.54 IROQ IF BANCORP IL 619,310 6.35 15.20 22.39 73.78 88.98 8.81 13.18 FCAP FIRST CAPITAL IN 765,381 24.13 16.33 16.91 53.21 69.54 0.01 10.39 UCBA UNITED COMMUNITY BANCORP IN 548,302 23.20 16.15 27.98 54.13 70.28 1.43 12.98 PBSK POAGE BANKSHARES KY 450,159 12.99 7.70 37.16 72.71 80.41 2.01 13.54 HFBL HOME FED BANCORP OF LOUISIANA LA 412,960 1.87 14.17 33.06 76.20 90.37 4.05 11.24 PVBC PROVIDENT BANCORP MA 890,772 5.53 3.40 12.50 85.31 88.71 5.08 13.17 RNDB RANDOLPH BANCORP MA 533,539 4.95 8.42 48.76 76.34 84.76 10.36 14.97 WEBK WELLESLEY BANCORP MA 819,586 12.72 1.76 53.89 82.91 84.67 12.87 7.33 HBK HAMILTON BANCORP MD 526,310 5.89 10.70 37.78 73.56 84.26 11.95 9.73 SVBI SEVERN BANCORP MD 801,183 7.50 3.61 39.58 82.61 86.22 12.04 11.54 HMNF HMN FINANCIAL MN 722,080 13.64 1.31 20.30 81.95 83.26 0.00 11.36 EQFN EQUITABLE FINANCIAL CORP NE 305,633 12.28 0.15 19.97 83.52 83.67 2.01 11.67 MGYR MAGYAR BANCORP NJ 607,831 4.63 8.23 30.81 79.57 87.80 5.65 8.23 MSBF MB BANCORP NJ 563,980 5.41 4.12 30.04 85.25 89.37 10.66 12.37 BCTF BANCORP 34 NM 340,840 2.41 6.65 17.83 75.80 82.45 13.71 14.56 CARV CARVER BANCORP NY 694,186 23.77 6.18 19.68 68.16 74.34 3.60 8.01 ESBK ELMIRA SAVINGS BANK NY 553,389 6.49 2.07 52.87 80.82 82.89 6.32 10.28 FSBC FSB BANCORP NY 312,853 7.15 2.51 70.37 85.20 87.71 20.63 10.01

  

   

 

 

 

KELLER & COMPANY Dublin, Ohio (614) 766-1426 COMPARABLE GROUP SELECTION BALANCE SHEET PARAMETERS Most Recent Quarter General Parameters: Regions: Mid-Atlantic, Midwest, North Central, Northeast, Southwest Asset Size: < $950 Million Stock trades on: NASDAQ or NYSE No Recent Acquisition Activity Total Assets ($000) Cash & Securities/ Assets (%) MBS/ Assets (%) 1-4 Fam. Loans/ Assets (%) Total Net Loans/ Assets (%) Total Net Loans & MBS/ Assets (%) Borrowed Funds/ Assets (%) Equity/ Assets (%) EQUITABLE BANK, SSB Wl 313,424 8.31 0.37 47.25 86.28 86.65 14.68 4.50 DEFINED PARAMETERS FOR INCLUSION IN COMPARABLE GROUP < 950,000 < 20.00 <16.00 <72.00 60.00 - 90.00 75.00 - 92.00 < 22.00 5.00 - 22.00 PCSB PCSB FINANCIAL CORP NY 1,456,724 18.51 16.94 17.87 60.36 77.30 4.73 19.54 PDLB PDL COMMUNITY BANCORP NY 947,938 8.80 0.42 40.75 86.82 87.24 2.82 17.48 EFBI EAGLE FIN BANCORP OH 132,160 12.00 0.00 54.57 77.51 77.51 0.00 20.80 ESSA ESSA BANCORP PA 1,820,924 9.11 13.55 35.83 70.91 84.46 20.91 9.74 PBIP PRUDENTIAL BANCORP PA 944,329 17.30 14.66 35.54 61.88 76.54 13.38 13.98 CWAY COASTWAY BANCORP RI 779,976 6.25 0.00 49.83 84.90 84.90 27.29 9.21

 

   

 

 

 

EXHIBIT 37 KELLER & COMPANY Dublin, Ohio (614) 766-1426 COMPARABLE GROUP SELECTION OPERATING PERFORMANCE AND ASSET QUALITY RATIOS Most Recent Four Quarters General Parameters: Regions: Mid-Atlantic, Midwest, North Central, Northeast, Southwest Asset Size: < $950 Million Stock trades on: NASDAQ or NYSE No Recent Acquisition Activity OPERATING PERFORMANCE ASSET QUALITY Total Assets ($000) Core ROAA (%) Core ROAE (%) Net Interest Margin (2) (%) Operating Expenses/ Assets (%) Noninterest Income/ Assets (%) NPA/ Assets (%) REO/ Assets (%) Reserves/ Assets (%) EQUITABLE BANK, SSB Wl 313,424 (0.04) (0.98) 3.49 4.24 0.84 1.72 1.26 0.42 DEFINED PARAMETERS FOR INCLUSION IN COMPARABLE GROUP < 950,000 < 1.10 < 10.00 2.70 - 4.20 1.50 - 4.50 < 1.50 < 1.80 < 1.30 > 0.40 SIFI SI FINANCIAL GROUP CT 1,598,222 0.49 4.63 2.93 2.47 0.69 0.56 0.07 0.81 CHFN CHARTER FINANCIAL CORP GA 1,659,791 1.00 7.41 3.84 3.02 1.21 0.10 0.02 0.67 CFBI COMM FIRST BANCSHARES GA 292,476 0.31 1.22 4.15 4.06 0.54 2.19 0 00 1.43 WCFB WCF BANCORP IA 124,421 0.06 0.24 2.84 2.95 0.84 0.62 0.05 0.45 IROQ IF BANCORP IL 619,310 0.34 2.51 3.07 2.54 0.78 1.34 0.05 0.92 FCAP FIRST CAPITAL IN 765,381 1.02 9.57 3.61 2.66 0.88 0.88 0.50 0.47 UCBA UNITED COMMUNITY BANCORP IN 548,302 0.78 5.85 2.95 2.73 0.82 0.13 0.01 0.69 PBSK POAGE BANKSHARES KY 450,159 (0.61) (4.36) 3.76 4.02 0.59 1.80 0.10 1.10 HFBL HOME FED BANCORP OF LOUISIANA LA 412,960 1.04 9.43 3.87 2.77 0.82 0.91 0.28 0.89 PVBC PROVIDENT BANCORP MA 890,772 0.72 5.56 4.16 2.75 1.06 1.08 0.00 1.15 RNDB RANDOLPH BANCORP MA 533,539 (0.48) (3.06) 3.25 5.56 2.24 0.57 0.04 0.72 WEBK WELLESLEY BANCORP MA 819,586 0.77 10.23 3.20 2.13 0.25 0.15 0.00 0.76 HBK HAMILTON BANCORP MD 526,310 0.33 2.92 3.08 2.44 0.39 1.45 0.09 0.54 SVBI SEVERN BANCORP MD 801,183 0.75 6.92 3.49 2.89 0.72 0.76 0.03 1.02 HMNF HMN FINANCIAL MN 722,080 0.79 7.09 3.89 3.53 1.05 0.55 0.10 1.26 EQFN EQUITABLE FINANCIAL CORP NE 305,633 0.49 3.72 3.68 2.86 0.81 1.48 0.07 1.50 MGYR MAGYAR BANCORP NJ 607,831 0.38 4.59 3.45 2.81 0.35 1.88 1.67 0.62 MSBF MB BANCORP NJ 563,980 0.79 6.19 3.42 0.26 0.15 0.85 0.00 0.98 BCTF BANCORP 34 NM 340,840 0.99 6.69 4.54 7.00 3.92 1.67 0.00 0.92 CARV CARVER BANCORP NY 694,186 (0.64) (8.81) 2.95 4.20 2.68 1.16 0.16 0.74 ESBK ELMIRA SAVINGS BANK NY 553,389 0.57 5.21 3.38 2.88 0.97 0.57 0.01 0.80 FSBC FSB BANCORP NY 312,853 0.26 2.51 2.90 3.41 1.15 0.03 0.00 0.43

 

   

 

 

 

KELLER & COMPANY Dublin, Ohio (614) 766-1426 COMPARABLE GROUP SELECTION OPERATING PERFORMANCE AND ASSET QUALITY RATIOS Most Recent Four Quarters General Parameters: Regions: Mid-Atlantic, Midwest, North Central, Northeast, Southwest Asset Size: < $950 Million Stock trades on: NASDAQ or NYSE No Recent Acquisition Activity OPERATING PERFORMANCE ASSET QUALITY Total Assets ($000) Core ROAA (%) Core ROAE (%) Net Interest Margin (2) (%) Operating Expenses/ Assets (%) Noninterest Income/ Assets (%) NPA/ Assets (%) REO/ Assets (%) Reserves/ Assets (%) EQUITABLE BANK, SSB Wl 313,424 (0.04) (0.98) 3.49 4.24 0.84 1.72 1.26 0.42 DEFINED PARAMETERS FOR INCLUSION IN COMPARABLE GROUP < 950,000 < 1.10 < 10.00 2.70-4.20 1.50-4.50 < 1.50 <1.80 < 1.30 > 0.40 PCSB PCSB FINANCIAL CORP NY 1,456,724 0.39 1.97 2.90 2.52 0.18 0.65 0.01 0.32 PDLB PDL COMMUNITY BANCORP NY 947,938 0.28 1.69 3.98 3.98 0.34 0.98 0.00 1.20 EFBI EAGLE FIN BANCORP OH 132.160 0.31 1.68 3.29 4.20 1.48 0.59 0.00 0.90 ESSA ESSA BANCORP PA 1,820,924 0.43 4.26 2.79 2.24 0.47 0.83 0.07 0.58 PBIP PRUDENTIAL BANCORP PA 944.329 0.93 6.33 2.94 1.59 0.24 1.49 0.01 0.51 CWAY COASTWAY BANCORP Rl 779,976 0.46 4.68 3.16 2.84 0.94 1.07 0.54 0.41

 

   

 

 

 

EXHBIT 38 KELLER & COMPANY Dublin, Ohio (614) 766-1426 FINAL COMPARABLE GROUP BALANCE SHEET RATIOS Most Recent Quarter Total Assets ($000) Cash & Securities/ Assets (%) MBS/ Assets (%) 1-4 Fam. Loans/ Assets (%) Total Net Loans/ Assets (%) Total Net Loans & MBS/ Assets (%) Borrowed Funds/ Assets (%) Equity/ Assets (%) EQUITABLE BANK, SSB Wl 313,424 8.31 0.37 47.25 86.28 86.65 14.68 4.50 DEFINED PARAMETERS FOR 60.00 - 75.00 - 5.00 - INCLUSION IN COMPARABLE GROUP < 950,000 < 20.00 <16.00 <72.00 90.00 92.00 < 22.00 22.00 EFBI EAGLE FIN BANCORP OH 132,160 12.00 0.00 54.57 77.51 77.51 0.00 20.80 EQFN EQUITABLE FINANCIAL CORP NE 305,633 12.28 0.15 19.97 83.52 83.67 2.01 11.67 FSBC FSB BANCORP NY 312,853 7.15 2.51 70.37 85.20 87.71 20.63 10.01 HFBL HOME FED BANCORP OF LOUISIANA LA 412,960 1.87 14.17 33.06 76.20 90.37 4.05 11.24 HBK HAMILTON BANCORP MD 526,310 5.89 10.70 37.78 73.56 84.26 11.95 9.73 ESBK ELMIRA SAVINGS BANK NY 553,389 6.49 2.07 52.87 80.82 82.89 6.32 10.28 IROQ IF BANCORP IL 619,310 6.35 15.20 22.39 73.78 88.98 8.81 13.18 HMNF HMN FINANCIAL MN 722,080 13.64 1.31 20.30 81.95 83.26 0.00 11.36 SVBI SEVERN BANCORP MD 801,183 7.50 3.61 39.58 82.61 86.22 12.04 11.54 PBIP PRUDENTIAL BANCORP PA 944,329 17.30 14.66 35.54 61.88 76.54 13.38 13.98 AVERAGE 533,021 9.05 6.44 38.64 77.70 84.14 7.92 12.38 MEDIAN 539,850 7.32 3.06 36.66 79.17 83.97 7.57 11.45 HIGH 944,329 17.30 15.20 70.37 85.20 90.37 20.63 20.80 LOW 132,160 1.87 0.00 19.97 61.88 76.54 0.00 9.73

 

 

   

 

 

 

EXHBIT 39 KELLER & COMPANY Dublin, Ohio (614) 766-1426 FINAL COMPARABLE GROUP OPERATING PERFORMANCE AND ASSET QUALITY RATIOS Most Recent Four Quarters EQUITABLE BANK, SSB Total Assets ($000) OPERATING PERFORMANCE ASSET QUALITY Core ROAA (%) Core ROAE (%) Net Interest Margin (%) Operating Expenses/ Assets (%) Noninterest Income/ Assets (%) NPA/ Assets (%) REO / Assets (%) Reserves/ Assets (%) WI 313,424 (0.04) (0.98) 3.49 4.24 0.84 1.72 1.26 0.42 DEFINED PARAMETERS FOR 2.70- 1.50- INCLUSION IN COMPARABLE GROUP < 950,000 < 1.10 < 10.00 4.20 4.50 < 1.50 < 1.80 < 1.30 > 0.40 EFBI EAGLE FIN BANCORP OH 132,160 0.31 1.68 3.29 4.20 1.48 0.59 0.00 0.90 EQFN EQUITABLE FINANCIAL CORP NE 305,633 0.49 3.72 3.68 2.86 0.81 1.48 0.07 1.50 FSBC FSB BANCORP NY 312,853 0.26 2.51 2.90 3.41 1.15 0.03 0.00 0.43 HFBL HOME FED BANCORP OF LOUISIANA LA 412,960 1.04 9.43 3.87 2.77 0.82 0.91 0.28 0.89 HBK HAMILTON BANCORP MD 526,310 0.33 2.92 3.08 2.44 0.39 1.45 0.09 0.54 ESBK ELMIRA SAVINGS BANK NY 553,389 0.57 5.21 3.38 2.88 0.97 0.57 0.01 0.80 IROQ IF BANCORP IL 619,310 0.34 2.51 3.07 2.54 0.78 1.34 0.05 0.92 HMNF HMN FINANCIAL MN 722,080 0.79 7.09 3.89 3.53 1.05 0.55 0.10 1.26 SVBI SEVERN BANCORP MD 801,183 0.75 6.92 3.49 2.89 0.72 0.76 0.03 1.02 PBIP PRUDENTIAL BANCORP PA 944,329 0.93 6.33 2.94 1.59 0.24 1.49 0.01 0.51 AVERAGE 533,021 0.58 4.83 3.36 2.91 0.84 0.92 0.06 0.88 MEDIAN 539,850 0.53 4.47 3.34 2.87 0.82 0.84 0.04 0.90 HIGH 944,329 1.04 9.43 3.89 4.20 1.48 1.49 0.28 1.50 LOW 132,160 0.26 1.68 2.90 1.59 0.24 0.03 0.00 0.43

 

   

 

 

 

EXHIBIT 40 KELLER & COMPANY Dublin, Ohio 614-766-1426 COMPARABLE GROUP CHARACTERISTICS AND BALANCE SHEET TOTALS Most Recent Quarter Total Goodwill Number Total Int. Earning Net and Total Total of Assets Assets Loans Intang. Deposits Equity Offices Exchange ($000) ($000) ($000) ($000) ($000) ($000) SUBJECT EQUIT ABLE BANK, SSB WAUWATOSA WI 6 - 313,424 294,762 263,999 0 244,463 14,102 COMPARABLE GROUP EFBI EAGLE FIN BANCORP CINCINNATI OH 0 NASDAQ 132,160 114,245 102,434 0 108,781 27,491 ESBK ELMIRA SAVINGS BANK ELMIRA NY 13 NASDAQ 553,389 489,968 447,261 13,752 456,851 56,886 EQFN EQUITABLE FINANCIAL CORP GRAND ISLAND NE 6 NASDAQ 305,633 256,175 255,260 2,299 266,300 35,659 FSBC FSB COMMUNITY BANKSHARES FAIRPORT NY 5 NASDAQ 312,853 282,830 266,546 894 216,761 31,315 HBK HAMILTON BANCORP TOWSON MD 5 NASDAQ 526,310 468,272 387,165 9,176 408,703 51,228 HMNF HMN FINANCIAL ROCHESTER MN 13 NASDAQ 722,080 676,749 591,779 2,856 640,821 82,056 HFBL HOME FED BANCORP OF LOUISIANA SHREVEPORT LA 6 NASDAQ 412,960 382,900 314,661 168 348,274 46,410 IROQ IF BANCORP WATSEKA IL 6 NASDAQ 619,310 572,062 456,942 791 489,708 81,613 PBIP PRUDENTIAL BANCORP PHILADELPHIA PA 6 NASDAQ 944,329 833,008 584,380 6,741 683,286 132,060 SVBI SEVERN BANCORP ANNAPOLIS MD 4 NASDAQ 801,183 744,408 661,840 1,603 590,013 92,417 Average 6 533,021 482,061 406,827 3,828 420,950 63,714 Median 6 539,850 479,120 417,213 1,951 432,777 54,057 High 13 944,329 833,008 661,840 13,752 683,286 132,060 Low 0 132,160 114,245 102,434 0 108,781 27,491

 

   

 

 

 

EXHIBIT 41 KELLER & COMPANY Dublin, Ohio 614-766-1426 BALANCE SHEET ASSET COMPOSITION - MOST RECENT QUARTER As a Percent of Total Assets Repo- Interest Interest Capitalized Total Cash & Net Loan Loss sessed Goodwill Non-Perf Earning Bearing Loan Assets Invest. MBS Loans Reserves Assets & Intang Assets Assets Liabilities Servicing ($000) (%) (%) (%) (%) (%) (%) (%) (%) (%) (%) SUBJECT EQUITABLE BANK, SSB 313,424 8.31 0.37 86.28 0.42 1.26 0.00 1.72 94.05 92.67 0.00 COMPARABLE GROUP EFBI EAGLE FIN BANCORP 132,160 12.00 0.00 77.51 0.90 0.00 0.00 0.59 91.26 78.70 0.00 EQFN EQUITABLE FINANCIAL CORP 305,633 12.28 0.15 83.52 1.50 0.07 0.47 1.48 93.74 75.40 0.28 FSBC FSB BANCORP 312,853 7.15 2.51 85.20 0.43 0.00 0.00 0.03 95.10 87.31 0.29 HFBL HOME FED BANCORP OF LOUISIANA 412,960 1 87 14.17 76.20 0.89 0.28 0.00 0.91 92.59 75.24 0.04 HBK HAMILTON BANCORP 526,310 5.89 10.70 73.56 0.54 0.09 1.74 1.45 90.62 83.23 0.00 ESBK ELMIRA SAVINGS BANK 553,389 6.49 2.07 80.82 0.80 0.01 2.23 0.57 88.12 75.50 0.26 IROQ IF BANCORP 619,310 6.35 15 20 73.78 0.92 0.05 0.00 1.34 94.86 82.21 0.13 HMNF HMN FINANCIAL 722,080 13.64 1.31 81.95 1.26 0.10 0.16 0.55 96.74 66.18 0.24 SVBI SEVERN BANCORP 801,183 7 50 3.61 82.61 1.02 0.03 0.14 0.76 94.16 76.49 0.06 PBIP PRUDENTIAL BANCORP 944,329 17 30 14.66 61.88 0.51 0.01 0.71 1.49 93.56 84.48 0.00 Average 533,021 9 05 6.44 77.70 0.88 0.06 0.55 0.92 93.08 78.47 0.13 Median 539,850 7.33 3 06 79.17 0 90 0.04 0.15 0.84 93.65 77 60 0.10 High 944,329 17.30 15.20 85.20 1.50 0 28 2.23 1.49 96.74 87.31 0.29 Low 132,160 1.87 0.00 61.88 0.43 0.00 0 00 0.03 88.12 66.18 0.00 ALL THRIFTS (122) Average 2,259,729 11.66 7.13 74.00 0.77 0.12 0.60 0.65 92.84 74.93 0.12 MIDWEST THRIFTS (39) Average 979,320 13.78 7.61 70.13 0.76 0.13 0.28 0.67 92.20 74.83 0.16 WISCONSIN THRIFTS (4) Average 760,469 7.60 7.82 75.58 0.79 0.08 0.02 0.27 92.49 57.59 0.04

 

   

 

 

 

EXHIBIT 42 KELLER & COMPANY Dublin, Ohio 614-766-1426 BALANCE SHEET COMPARISON LIABILITIES AND EQUITY - MOST RECENT QUARTER As a Percent of Assets Total Liabilities ($000) Total Equity ($000) Total Deposits (%) Total Borrowings (%) Other Liabilities (%) Preferred Equity (%) Common Equity (%) Acc. Other Compr. Income (%) Retained Earnings (%) Total Equity (%) Tier 1 Capital (%) Total Risk-Based Capital (%) SUBJECT EQUITABLE BANK, SSB 299,322 14,102 78.00 14.68 2.83 0.00 4.50 (0.70) 5.20 4.50 5.30 8.70 COMPARABLE GROUP EFBI EAGLE FIN BANCORP 104,669 27,491 82.31 0.00 (3.11) 0.00 20.80 0.00 10.87 20.80 15.65 17.50 EQFN EQUITABLE FINANCIAL CORP 269,974 35,659 87.13 2.01 (0.81) 0.00 11.67 (0.01) 4.93 11.67 9.99 12.18 FSBC FSB BANCORP 281,538 31,315 69.29 20.63 0.08 0.00 10.01 (0.08) 6.02 10.01 9.45 16.32 HFBL HOME FED BANCORP OF LOUISIANA 366,550 46,410 84.34 4.05 0.38 0.00 11.24 (0.26) 7.64 11.24 11.38 17.59 HBK HAMILTON BANCORP 475,082 51,228 77.65 11.95 0.66 0.00 9.73 (0.32) 6.18 9.73 8.07 11.66 ESBK ELMIRA SAVINGS BANK 496,503 56,886 82.56 6.32 0.84 0.00 10.28 (0.05) 1.06 10.28 8.65 13.70 IROQ IF BANCORP 537,697 81,613 79.07 8.81 (1.06) 0.00 13.18 (0.47) 8.28 13.18 11.70 16.83 HMNF HMN FINANCIAL 640,024 82,056 88.75 0.00 (0.11) 0.00 11.36 (0.19) 3.33 11.36 10.97 13.93 SVBI SEVERN BANCORP 708,766 92,417 73.64 12.04 0.20 0.00 11.53 (0.01) 3.41 11.54 10.27 14.98 PBIP PRUDENTIAL BANCORP 812,269 132,060 72.36 13.38 0.28 0.00 13.98 (0.47) 2.91 13.98 13.09 21.05 Average 469,307 63,714 79.71 7.92 (0.27) 0.00 12.38 (0.19) 5.46 12.38 10.92 15.57 Median 485,793 54,057 80.69 7.57 0.14 0.00 11.45 (0.14) 5.47 11.45 10.62 15.65 High 812,269 132,060 88.75 20.63 0.84 0.00 20.80 0.00 10.87 20.80 15.65 21.05 Low 104,669 27,491 69.29 0.00 (3.11) 0.00 9.73 (0.47) 1.06 9.73 8.07 11.66 ALL THRIFTS (122) Average 1,983,827 275,902 77.83 9.27 0.14 0.06 12.54 (0.26) 6.35 12.60 11.79 18.88 MIDWEST THRIFTS (39) Average 877,240 102,079 79.03 8.05 0.28 0.00 12.58 (0.26) 6.64 12.58 11.92 20.30 WISCONSIN THRIFTS (4) Average 625,063 135,407 74.37 10.67 (0.29) 0.00 15.26 (0.19) 6.78 15.26 14.50 20.52

 

   

 

 

 

EXHIBIT 43 KELLER & COMPANY Dublin, Ohio 614-766-1426 INCOME AND EXPENSE COMPARISON TRAILING FOUR QUARTERS ($000) Interest Income Interest Expense Net Interest Income Provision for Loss Gain (Loss) on Sale Total Non-lnt. Income Total Non-lnt. Expense Net Income Before Taxes Income Taxes Net Income Core Income SUBJECT EQUITABLE BANK, SSB 11,765 1,585 10,180 425 0 2,595 13,141 (792) (425) (367) (133) COMPARABLE GROUP EFBI EAGLE FIN BANCORP 4,427 670 3,757 92 0 1,950 5,545 620 (48) 668 401 EQFN EQUITABLE FINANCIAL CORP 11,026 1,608 9,418 1,263 0 2,482 8,730 2,170 1,051 1,119 1,330 FSBC FSB BANCORP 11,242 3,031 8,211 294 0 3,608 10,659 1,217 498 719 790 HFBL HOME FED BANCORP OF LOUISIANA 18,191 3,364 14,827 995 94 3,390 11,441 6,152 2,464 3,688 4,360 HBK HAMILTON BANCORP 18,013 3,613 14,400 1,575 (2) 2,054 12,863 2,070 2,668 (598) 1,698 ESBK ELMIRA SAVINGS BANK 20,546 3,996 16,550 897 0 5,360 15,958 5,055 147 4,903 3,181 IROQ IF BANCORP 22,140 4,585 17,555 1,964 800 4,832 15,751 4,725 2,846 1,879 2,092 HMNF HMN FINANCIAL 28,178 1,860 26,318 (378) 0 7,549 25,461 9,714 4,659 5,055 5,712 SVBI SEVERN BANCORP 33,544 7,552 25,992 (375) 2 5,749 23,190 8,927 5,149 3,778 5,977 PBIP PRUDENTIAL BANCORP 31,558 7,064 24,494 800 235 2,304 14,995 11,692 4,842 6,850 8,482 Average 19,887 3,734 16,152 713 113 3,928 14,459 5,234 2,428 2,806 3,402 Median 19,369 3,489 15,689 849 0 3,499 13,929 4,890 2,566 2,784 2,637 High 33,544 7,552 26,318 1,964 800 7,549 25,461 11,692 5,149 6,850 8,482 Low 4,427 670 3,757 (378) (2) 1,950 5,545 620 (48) (598) 401 ALL THRIFTS (122) Average 76,684 15,104 61,580 1,687 487 19,731 43,761 29,215 11,371 18,455 19,107 MIDWEST THRIFTS (39) Average 33,502 7,217 26,286 539 204 20,789 34,048 13,363 6,165 7,197 9,525 WISCONSIN THRIFTS (4) Average 28,614 5,968 22,646 (440) (16) 32,888 43,203 12,454 5,066 7,388 8,190

 

   

 

 

 

EXHIBIT 44 KELLER & COMPANY Dublin, Ohio 614-766-1426 INCOME AND EXPENSE COMPARISON AS A PERCENTAGE OF AVERAGE ASSETS Interest Income Interest Expense Net Interest Income Provision for Loss Gain (Loss) on Sale Total Non-lnt. Income Total Non-lnt. Expense Net Income Before Taxes Income Taxes Net Income Core Income SUBJECT EQUITABLE BANK, SSB 3.80 0.51 3.29 0.14 0.00 0.84 4.24 (0.26) (0.14) (0.12) (0.04) COMPARABLE GROUP EFBI EAGLE FIN BANCORP 3.40 0.51 2.88 0.07 0.00 1.50 4.25 0.48 (0.04) 0.51 0.31 EQFN EQUITABLE FINANCIAL CORP 4.04 0.59 3.45 0.46 0.00 0.91 3.20 0.79 0.38 0.41 0.49 FSBC FSB BANCORP 3.70 1.00 2.70 0.10 0.00 1.19 3.50 0.40 0.16 0.24 0.26 HFBL HOME FED BANCORP OF LOUISIANA 4.35 0.80 3.55 0.24 0.02 0.81 2.74 1.47 0.59 0.88 1.04 HBK HAMILTON BANCORP 3.49 0.70 2.79 0.31 (0.00) 0.40 2.49 0.40 0.52 (0.12) 0.33 ESBK ELMIRA SAVINGS BANK 3.66 0.71 2.95 0.16 0.00 0.95 2.84 0.90 0.03 0.87 0.57 IROQ IF BANCORP 3.65 0.76 2.89 0.32 0.13 0.80 2.59 0.78 0.47 0.31 0.34 HMNF HMN FINANCIAL 3.91 0.26 3.65 (0.05) 0.00 1.05 3.53 1.35 0.65 0.70 0.79 SVBI SEVERN BANCORP 4.22 0.95 3.27 (0.05) 0.00 0.72 2.91 1.12 0.65 0.47 0.75 PBIP PRUDENTIAL BANCORP 3.46 0.77 2.68 0.09 0.03 0.25 1.64 1.28 0.53 0.75 0.93 Average 3.79 0.71 3.08 0.16 0.02 0.86 2.97 0.90 0.39 0.50 0.58 Median 3.68 0.73 2.92 0.13 0.00 0.86 2.88 0.85 0.49 0.49 0.53 High 4.35 1.00 3.65 0.46 0.13 1.50 4.25 1.47 0.65 0.88 1.04 Low 3.40 0.26 2.68 (0.05) (0.00) 0.25 1.64 0.40 (0.04) (0.12) 0.26 ALL THRIFTS (122) Average 3.74 0.64 3.09 0.08 0.01 0.84 2.81 1.03 0.40 0.84 0.87 MIDWEST THRIFTS (39) Average 3.47 0.62 2.86 0.06 0.01 0.87 3.10 0.90 0.32 0.78 1.03 WISCONSIN THRIFTS (4) Average 4.01 0.75 3.26 (0.12) 0.00 0.57 3.66 0.79 0.35 0.96 1.06

 

   

 

 

 

EXHIBIT 45 KELLER & COMPANY Dublin, Ohio 614-766-1426 YIELDS, COSTS AND EARNINGS RATIOS TRAILING FOUR QUARTERS Yield on Cost of Net Net Int. Earning Int. Bearing Interest Interest Core Core Assets Liabilities Spread Margin * ROAA ROAE ROAA ROAE (%) (%) (%) (%) (%) (%) (%) (%) SUBJECT EQUITABLE BANK, SSB 4.03 0.59 3.44 3.49 (0.12) (2.70) (0.04) (0.98) COMPARABLE GROUP EFBI EAGLE FIN BANCORP 3.88 0.63 3.24 3.29 0.51 2.79 0.31 1.68 EQFN EQUITABLE FINANCIAL CORP 4.30 0.68 3.63 3.68 0.41 3.13 0.49 3.72 FSBC FSB BANCORP 3.97 1.50 2.47 2.90 0.24 2.28 0.26 2.51 HFBL HOME FED BANCORP OF LOUISIANA 4.75 1.00 3.76 3.87 0.88 7.98 1.04 9.43 HBK HAMILTON BANCORP 3.85 0.88 2.97 3.08 (0.12) (1.03) 0.33 2.92 ESBK ELMIRA SAVINGS BANK 4.19 0.88 3.31 3.38 0.87 8.03 0.57 5.21 IROQ IF BANCORP 3.87 0.98 2.89 3.07 0.31 2.25 0.34 2.51 HMNF HMN FINANCIAL 4.16 0.30 3.86 3.89 0.70 6.28 0.79 7.09 SVBI SEVERN BANCORP 4.51 1.28 3.23 3.49 0.47 4.38 0.75 6.92 PBIP PRUDENTIAL BANCORP 3.79 1.09 2.70 2.94 0.75 5.11 0.93 6.33 Average 4.13 0.92 3.21 3.36 0.50 4.12 0.58 4.83 Median 4.07 0.93 3.24 3.33 0.49 3.76 0.53 4.47 High 4.75 1.50 3.86 3.89 0.88 8.03 1.04 9.43 Low 3.79 0.30 2.47 2.90 (0.12) (1.03) 0.26 1.68 ALL THRIFTS (122) Average 4.07 0.86 3.22 3.37 0.84 6.84 0.87 7.08 MIDWEST THRIFTS (39) Average 3.75 0.81 2.98 3.09 0.78 7.40 1.03 9.73 WISCONSIN THRIFTS (4) Average 4.03 0.90 3.41 3.30 0.97 5.46 1.07 6.05 * Based on average interest-earning assets.

 

   

 

 

 

EXHIBIT 46 KELLER & COMPANY Dublin, Ohio 614-766-1426 RESERVES AND SUPPLEMENTAL DATA RESERVES AND SUPPLEMENTAL DATA Reserves/ Gross Loans (%) Reserves/ NPA (%) Net Chargeoffs/ Average Loans (%) Provisions/ Net Chargeoffs (%) Effective Tax Rate (%) SUBJECT EQUITABLE BANK, SSB 0.49 24.51 0.36 44.04 NM COMPARABLE GROUP EFBI EAGLE FIN BANCORP 1.07 151.53 0.11 0.00 19.22 EQFN EQUITABLE FINANCIAL CORP 1.73 101.86 (0.01) NM 41.08 FSBC FSB BANCORP 0.49 NM 0.00 0.00 30.14 HFBL HOME FED BANCORP OF LOUISIANA 1.11 98.72 0.53 2,125.00 36.15 HBK HAMILTON BANCORP 0.72 37.00 1.96 128.90 NM ESBK ELMIRA SAVINGS BANK 0.97 140.15 0.24 82.35 21.52 IROQ IF BANCORP 1.21 68.54 0.50 30.63 45.40 HMNF HMN FINANCIAL 1.49 229.78 0.00 (219.30) 43.11 SVBI SEVERN BANCORP 1.18 135.05 0.17 0.00 48.26 PBIP PRUDENTIAL BANCORP 0.81 34.32 0.91 NM 37.11 Average 1.08 110.77 0.44 268.45 35.78 Median 1.09 101.86 0.21 15.32 37.11 High 1.73 229.78 1.96 2,125.00 48.26 Low 0.49 34.32 (0.01) (219.30) 19.22 ALL THRIFTS (122) Average 1.01 124.74 0.16 (851.87) 33.03 MIDWEST THRIFTS (39) Average 1.02 119.42 0.21 (1,419.52) 31.24 WISCONSIN THRIFTS (4) Average 0.97 138.83 0.11 (3,090.23) 29.66

 

   

 

 

 

EXHIBIT 47 KELLER & COMPANY Dublin, Ohio 614-766-1426 FULL CONVERSION COMPARABLE GROUP MARKET, PRICING AND FINANCIAL RATIOS STOCK PRICES AS OF AUGUST 17, 2018 FINANCIAL DATA/ALL RATIOS MOST RECENT FOUR QUARTERS Market Data Price Ratios Dividends Financial Ratios Market Value ($M) Market Price/ Share ($) 12 Mo. EPS ($) Bk. Value /Share ($) Price/ Earnings (X) Price/ Book Value (%) Price/ Assets (%) Price/ Tang. Bk. Val. (%) Price/ Core Earnings (X) 12 Mo. Div./ Share ($) Dividend Yield (%) Payout Ratio (%) Equity/ Assets (%) Core ROAA (%) Core ROAE (%) THE EQUITABLE BANK, S.S.B. Appraised value - midpoint 23,000 10.00 0.19 14.83 NM 67.42 6.90 67.42 NM 0.00 0.00 0.00 10.23 0.08 0.78 Minimum 19,550 10.00 0.18 15.81 NM 63.25 5.92 63.25 NM 0.00 0.00 0.00 9.36 0.06 0.65 Maximum 26,450 10.00 0.19 14.11 NM 70.86 7.86 70.86 NM 0.00 0.00 0.00 11.09 0.10 0.89 Maximum, as adjusted 30,418 10.00 0.19 13.48 NM 74.16 8.94 74.16 NM 0.00 0.00 0.00 12.05 0.12 0.99 ALL THRIFTS (122) Average 380,398 24.80 1.46 20.54 26.94 131.36 15.71 142.75 23.70 0.32 1.36 21.90 12.60 0.80 6.52 Median 84,273 19.23 0.73 15.60 22.39 124.48 15.22 129.49 19.59 0.20 0.80 10.10 11.65 0.75 6.19 WISCONSIN THRIFTS (4) Average 167,966 16.12 0.42 13.44 22.31 120.73 18.72 121.19 18.94 0.37 2.17 0.00 15.26 0.96 8.11 Median 79,652 15.53 0.43 12.74 22.31 120.82 18.98 120.96 18.94 0.00 0.00 0.00 15.47 0.30 2.99 COMPARABLE GROUP (10) Average 72,384 18.49 0.77 16.62 29.87 110.85 13.63 118.50 29.49 0.21 1.01 19.94 12.38 0.58 4.83 Median 58,563 17.97 0.45 16.59 28.68 112.09 13.20 118.01 24.31 0.06 0.42 12.95 11.45 0.53 4.47 COMPARABLE GROUP EFBI EAGLE FIN BANCORP 25,498 15.81 0.41 17.05 38.56 92.75 19.29 92.75 63.59 0.00 0.00 0.00 20.80 0.31 1.68 ESBK ELMIRA SAVINGS BANK 53,666 20.30 1.85 21.52 10.97 94.34 9.70 124.42 16.87 0.92 4.53 49.73 10.28 0.57 5.21 EQFN EQUITABLE FINANCIAL CORP 39,812 12.00 0.34 10.75 35.29 111.65 13.03 119.34 29.93 0.00 0.00 0.00 11.67 0.49 3.72 FSBC FSB BANCORP 34,088 17.56 0.37 16.13 47.46 108.86 10.90 112.06 43.15 0.00 0.00 0.00 10.01 0.26 2.51 HBK HAMILTON BANCORP 49,461 14.50 0.15 15.02 29.13 96.55 9.40 117.62 29.13 0.00 0.00 0.00 9.73 0.33 2.92 HMNF HMN FINANCIAL 93,463 20.75 1.12 18.22 18.53 113.90 12.94 118.01 16.36 0.00 0.00 0.00 11.36 0.79 7.09 HFBL HOME FED BANCORP OF LOUIS 63,460 33.25 1.93 24.32 17.23 136.74 15.37 137.24 14.56 0.50 1.50 25.91 11.24 1.04 9.43 IROQ IF BANCORP 91,837 23.60 0.48 20.97 49.17 112.53 14.83 113.63 43.90 0.20 0.85 41.67 13.18 0.34 2.51 PBIP PRUDENTIAL BANCORP 165,388 18.38 0.76 14.68 24.18 125.24 17.51 131.97 19.50 0.33 1.80 43.42 13.98 0.93 6.33 SVBI SEVERN BANCORP 107,167 8.75 0.31 7.55 28.23 115.96 13.38 118.01 17.93 0.12 1.37 38.71 11.54 0.75 6.92

 

   

 

 

 

EXHIBIT 48 KELLER & COMPANY Columbus, Ohio 614-766-1426 VALUATION ANALYSIS AND CALCULATION - FULL CONVERSION THE EQUITABLE BANK, S.S.B. Pricing ratios and parameters Pro Forma Symbol Midpoint Ratios Comparable Group Average Median All Thrifts Average Trifts Median Price to earnings P/E NM 29.87 28.68 26.94 22.39 Price to core earnings P/CE NM 29.49 24.31 23.70 19.59 Price to book value P/B 67.42 110.85 112.09 131.36 124.48 Price to tangible book value P/TB 67.42 118.50 118.01 142.75 129.49 Price to assets P/A 6.90 13.63 13.20 15.71 15.22 Pre conversion earnings (V) $ (367,000) Pre conversion core earnings (CY) $ (133,000) Pre conversion book value (B) $ 14,102,000 Pre conversion tang, book value (TB) $ 14,102,000 Pre conversion assets (A) $ 313,424,000 Conversion expense (X) 5.54% Percent sold (PCT) 100.00% ESOP stock purchase (E) 7.00% Option % granted (OP) 0.00% ESOP cost of borrowings, net (S) 0.00% Est. option value (OV) 0.00% ESOP term (yrs.) (T) 25 Option maturity (OM) 10 RRP amount (M) 0.00% Option % taxable (OT) 0.00% RRP term (yrs.) (N) 0 Price per share (P) $ 10.00 Tax rate (TAX) 21.00% Investment rate of return, pretax 2.85% Investment rate of return, net (RR) 2.25% Formulae to indicate value after conversion: 1. P/CE method: Value = P/CE*CY ((1-P/CE*(PCT)*((1-X-E-M)*(RR*(1-TAX))-((1-TAX)*E/T)-((1-TAX)*M/N)-((1-TAX)*OT)*(OP*OV)/OM))) = $ NM 2. P/B method: Value = P/B*(B) (1 -PB*(PCT)*(1 -X-E-M)) = $ 23,000,000 3. P/A method: Value = P/A*(A) (1-PA*(PCT)*(1-X-E-M)) = $ 23,000,000 VALUATION CORRELATION AND CONCLUSIONS: Share Public Gross Proceeds of Public MHC Total TOTAL Pricee Shares Sold Offering Shares Issued Shares Issued VALUE Midpoint 10.00 2,300,000 $23,000,000 0 2,300,000 $23,000,000 Minimum 10.00 1,955,000 $19,550,000 0 1,955,000 $19,550,000 Maximum 10.00 2,645,000 $26,450,000 0 2,645,000 $26,450,000 Maximum, as adjusted 10.00 3,041,750 $30,417,500 0 3,041,750 $30,417,500

 

   

 

 

 

EXHIBIT 49 KELLER & COMPANY Columbus, Ohio 614-766-1426 PROJECTED EFFECT OF CONVERSION PROCEEDS THE EQUITABLE BANK, S.S.B. Minority Offering at the MINIMUM 1. Gross Offering Proceeds Offering proceeds(1) $ 19,550,000 Less: Estimated offering expenses 1,275,000 Net offering proceeds $ 18,275,000 2. Generation of Additional Income Net offering proceeds $ 18,275,000 Less: Stock-based benefit plans (2) 1,368,500 Less: MHC capitalization 100,000 Net offering proceeds invested $ 16,806,500 Investment rate, after taxes 2.25% Earnings increase - return on proceeds invested $ 378,398 Less: Estimated cost of ESOP borrowings 0 Less: Amortization of ESOP borrowings, net of taxes 43,245 Less: Stock-based incentive plan expense, net of taxes 0 Less: Option expense, net of applicable taxes 0 Net earnings increase (decrease) $ 335,154 3. Comparative Pro Forma Earnings Net Core Before conversion -12 months ended 6/30/18 $ (367,000) $ (133,000) Net earnings increase (decrease) 335,154 335,154 After conversion $ (31,846) $ 202,154 4. Comparative Pro Forma Net Worth (3) Total Tangible Before conversion - 6/30/18 $ 14,102,000 $ 14,102,000 Net cash conversion proceeds 16,806,500 16,806,500 MHC consolidation 0 0 After conversion $ 30,908,500 $ 30,908,500 5. Comparative Pro Forma Assets Before conversion - 6/30/18 $ 313,424,000 Net cash conversion proceeds 16,806,500 MHC consolidation 0 After conversion $ 330,230,500 (1) Represents gross proceeds of public offering. (2) Represents ESOP and stock-based incentive plans (3) ESOP and RRP are omitted from net worth.

 

   

 

 

 

EXHIBIT 50 KELLER & COMPANY Columbus, Ohio 614-766-1426 PROJECTED EFFECT OF CONVERSION PROCEEDS THE EQUITABLE BANK, S.S.B. Minority Offering at the MIDPOINT 1. Gross Offering Proceeds Offering proceeds (1) $ 23,000,000 Less: Estimated offering expenses 1,275,000 Net offering proceeds $ 21,725,000 2. Generation of Additional Income Net offering proceeds $ 21,725,000 Less: Stock-based benefit plans (2) 1,610,000 Less: MHC capitalization 100,000 Net offering proceeds invested $ 20,015,000 Investment rate, after taxes 2.25% Earnings increase - return on proceeds invested $ 450,638 Less: Estimated cost of ESOP borrowings 0 Less: Amortization of ESOP borrowings, net of taxes 50,876 Less: Stock-based incentive plan expense, net of taxes 0 Less: Option expense, net of applicable taxes 0 Net earnings increase (decrease) $ 399,762 3. Comparative Pro Forma Earnings Regular Core Before conversion -12 months ended 6/30/18 $ (367,000) $ (133,000) Net earnings increase 399,762 399,762 After conversion $ 32,762 $ 266,762 4. Comparative Pro Forma Net Worth (3) Total Tangible Before conversion - 6/30/18 $ 14,102,000 $ 14,102,000 Net cash conversion proceeds 20,015,000 20,015,000 MHC consolidation 0 0 After conversion $ 34,117,000 $ 34,117,000 5. Comparative Pro Forma Assets Before conversion - 6/30/18 $ 313,424,000 Net cash conversion proceeds 20,015,000 MHC consolidation 0 After conversion $ 333,439,000 (1) Represents gross proceeds of public offering. (2) Represents ESOP and stock-based incentive plans.. (3) ESOP and RRP are omitted from net worth.

 

   

 

 

 

EXHIBIT 51 KELLER & COMPANY Columbus, Ohio 614-766-1426 PROJECTED EFFECT OF CONVERSION PROCEEDS THE EQUITABLE BANK, S.S.B. Minority Offering at the MAXIMUM 1. Gross Offering Proceeds Offering proceeds (1) $ 26,450,000 Less: Estimated offering expenses 1,275,000 Net offering proceeds $ 25,175,000 2. Generation of Additional Income Net offering proceeds $ 25,175,000 Less: Stock-based benefit plans (2) 1,851,500 Less: MHC capitalization 100,000 Net offering proceeds invested $ 23,223,500 Investment rate, after taxes 2.25% Earnings increase - return on proceeds invested $ 522,877 Less: Estimated cost of ESOP borrowings 0 Less: Amortization of ESOP borrowings, net of taxes 58,507 Less: Stock-based incentive plan expense, net of taxes 0 Less: Option expense, net of applicable taxes 0 Net earnings increase (decrease) $ 464,370 3. Comparative Pro Forma Earnings Regular Core Before conversion -12 months ended 6/30/18 $ (367,000) $ (133,000) Net earnings increase 464,370 464,370 After conversion $ 97,370 $ 331,370 4. Comparative Pro Forma Net Worth (3) Total Tangible Before conversion - 6/30/18 $ 14,102,000 $ 14,102,000 Net cash conversion proceeds 23,223,500 23,223,500 MHC consolidation 0 0 After conversion $ 37,325,500 $ 37,325,500 5. Comparative Pro Forma Assets Before conversion - 6/30/18 $ 313,424,000 Net cash conversion proceeds 23,223,500 MHC consolidation 0 After conversion $ 336,647,500 (1) Represents gross proceeds of public offering. (2) Represents ESOP and stock-based incentive plans.. (3) ESOP and RRP are omitted from net worth.

 

   

 

 

 

EXHIBIT 52 KELLER & COMPANY Columbus, Ohio 614-766-1426 PROJECTED EFFECT OF CONVERSION PROCEEDS THE EQUITABLE BANK, S.S.B. Minority Offering at the Maximum, as adjusted 1. Gross Offering Proceeds Offering proceeds (1) $ 30,417,500 Less: Estimated offering expenses 1,275,000 Net offering proceeds $ 29,142,500 2. Generation of Additional Income Net offering proceeds $ 29,142,500 Less: Stock-based benefit plans (2) 2,129,225 Less: MHC capitalization 100,000 Net offering proceeds invested $ 26,913,275 Investment rate, after taxes 2.25% Earnings increase - return on proceeds invested $ 605,952 Less: Estimated cost of ESOP borrowings 0 Less: Amortization of ESOP borrowings, net of taxes 67,284 Less: Stock-based incentive plan expense, net of taxes 0 Less: Option expense, net of applicable taxes 0 Net earnings increase (decrease) $ 538,669 3. Comparative Pro Forma Earnings Regular Core Before conversion -12 months ended 6/30/18 $ (367,000) $ (133,000) Net earnings increase 538,669 538,669 After conversion $ 171,669 $ 405,669 4. Comparative Pro Forma Net Worth (3) Total Tangible Before conversion - 6/30/18 $ 14,102,000 $ 14,102,000 Net cash conversion proceeds 26,913,275 26,913,275 MHC consolidation 0 0 After conversion $ 41,015,275 $ 41,015,275 5. Comparative Pro Forma Assets Before conversion - 6/30/18 $ 313,424,000 Net cash conversion proceeds 26,913,275 MHC consolidation 0 After conversion $ 340,337,275 (1) Represents gross proceeds of public offering. (2) Represents ESOP and stock-based incentive plans.. (3) ESOP and RRP are omitted from net worth.

 

   

 

 

 

EXHIBIT 53 KELLER & COMPANY Columbus, Ohio 614-766-1426 MINORITY OFFERING SUMMARY OF VALUATION PREMIUM OR DISCOUNT THE EQUITABLE BANK, S.S.B. Premium or (discount) from comparable group. The Equitable Bank, S.S.B. Average Median Midpoint: Price/earnings NM x NM NM Price/book value 67.42 % * -39.18% -39.85% Price/assets 6.90 % -49.41% -47.75% Price/tangible book value 67.42 % -43.11% -42.87% Price/core earnings NM x NM NM Minimum of range: Price/earnings NM x NM NM Price/book value 63.25 % * -42.94% -43.57% Price/assets 5.92 % -56.58% -55.15% Price/tangible book value 63.25 % -46.63% -46.40% Price/core earnings NM x NM NM Maximum of range: Price/earnings NM x NM NM Price/book value 70.86 % * -36.07% -36.78% Price/assets 7.86 % -42.37% -40.48% Price/tangible book value 70.86 % -40.20% -39.95% Price/core earnings NM x NM NM Super maximum of range: Price/earnings NM x NM NM Price/book value 74.16 % * -33.10% -33.84% Price/assets 8.94 % -34.45% -32.30% Price/tangible book value 74.16 % -37.42% -37.16% Price/core earnings NM x NM NM * Represents pricing ration associated with primary valuation method.

 

   

 

 

 

EXHIBIT 54 KELLER & COMPANY Dublin, Ohio 614-766-1426 STAGE ONE MHC CONVERSION COMPARABLE GROUP MARKET, PRICING AND FINANCIAL RATIOS STOCK PRICES AS OF AUGUST 17, 2018 FINANCIAL DATA/ALL RATIOS MOST RECENT FOUR QUARTERS Market Data Pricing Ratios Dividends Financial Ratios Market Price/ Value Share ($M) ($) 12 Mo. EPS ($) Bk. Value /Share ($) Price/ Earnings (X) Price/ Book Value (%) Price/ Assets (%) Price/ Tang. Bk. Val. (%) Price/ Core Earnings (X) 12 Mo. Div./ Share ($) Dividend Yield (%) Payout Ratio (%) Equity/ Assets (%) Core ROAA (%) Core ROAE (%) THE EQUITABLE BANK, S.S.B. Appraised value - midpoint 23,000 10.00 0.07 9.76 NM 102.44 7.15 102.44 NM 0.00 0.00 0.00 6.98 0.01 0.14 Minimum 19,550 10.00 0.07 10.75 NM 93.06 6.10 93.06 NM 0.00 0.00 0.00 6.56 0.00 0.01 Maximum 26,450 10.00 0.08 9.03 NM 110.69 8.18 110.69 NM 0.00 0.00 0.00 7.39 0.02 0.26 Maximum, as adjusted 30,418 10.00 0.08 8.40 NM 119.02 9.36 119.02 NM 0.00 0.00 0.00 7.87 0.03 0.37 ALL THRIFTS (122) Average 380,398 24.80 1.46 20.54 26.94 131.36 15.71 142.75 23.70 0.32 1.36 21.90 12.60 0.80 6.52 Median 84,273 19.23 0.73 15.60 22.39 124.48 15.22 129.49 19.59 0.20 0.80 10.10 11.65 0.75 6.19 WISCONSIN THRIFTS (4) Average 167,966 16.12 0.42 13.44 22.31 120.73 18.72 121.19 18.94 0.37 2.17 0.00 15.26 0.96 8.11 Median 79,652 15.53 0.43 12.74 22.31 120.82 18.98 120.96 18.94 0.00 0.00 0.00 15.47 0.30 2.99 COMPARABLE GROUP (10) Average 72,384 18.49 0.77 16.62 29.87 110.85 13.63 118.50 29.49 0.21 1.01 19.94 12.38 0.58 4.83 Median 58,563 17.97 0.45 16.59 28.68 112.09 13.20 118.01 24.31 0.06 0.42 12.95 11.45 0.53 4.47 COMPARABLE GROUP EFBI EAGLE FIN BANCORP 25,498 15.81 0.41 17.05 38.56 92.75 19.29 92.75 63.59 0.00 0.00 0.00 20.80 0.31 1.68 ESBK ELMIRA SAVINGS BANK 53,666 20.30 1.85 21.52 10.97 94.34 9.70 124.42 16.87 0.92 4.53 49.73 10.28 0.57 5.21 EQFN EQUITABLE FINANCIAL CORP 39,812 12.00 0.34 10.75 35.29 111.65 13.03 119.34 29.93 0.00 0.00 0.00 11.67 0.49 3.72 FSBC FSB BANCORP 34,088 17.56 0.37 16.13 47.46 108.86 10.90 112.06 43.15 0.00 0.00 0.00 10.01 0.26 2.51 HBK HAMILTON BANCORP 49,461 14.50 0.15 15.02 29.13 96.55 9.40 117.62 29.13 0.00 0.00 0.00 9.73 0.33 2.92 HMNF HMN FINANCIAL 93,463 20.75 1.12 18.22 18.53 113.90 12.94 118.01 16.36 0.00 0.00 0.00 11.36 0.79 7.09 HFBL HOME FED BANCORP OF LOUIS 63,460 33.25 1.93 24.32 17.23 136.74 15.37 137.24 14.56 0.50 1.50 25.91 11.24 1.04 9.43 IROQ IF BANCORP 91,837 23.60 0.48 20.97 49.17 112.53 14.83 113.63 43.90 0.20 0.85 41.67 13.18 0.34 2.51 PBIP PRUDENTIAL BANCORP 165,388 18.38 0.76 14.68 24.18 125.24 17.51 131.97 19.50 0.33 1.80 43.42 13.98 0.93 6.33 SVBI SEVERN BANCORP 107,167 8.75 0.31 7.55 28.23 115.96 13.38 118.01 17.93 0.12 1.37 38.71 11.54 0.75 6.92

 

   

 

 

 

EXHIBIT 55 KELLER & COMPANY Columbus, Ohio 614-766-1426 VALUATION ANALYSIS AND CALCULATION - STAGE ONE MHC CONVERSION THE EQUITABLE BANK, S.S.B. Pricing ratios and parameters: Pro Forma Symbol Midpoint Ratios Comparable Average Group Median All \ Average Thrifts Median Price to earnings P/E NM 29.87 28.68 26.94 22.39 Price to core earnings P/CE NM 29.49 24.31 23.70 19.59 Price to book value P/B 102.90 110.85 112.09 131.36 124.48 Price to tangible book value P/TB 102.90 118.50 118.01 142.75 129.49 Price to assets P/A 7.15 13.63 13.20 15.71 15.22 Pre conversion earnings (Y) $ (367,000) Pre conversion core earnings (CY) $ (133,000) Pre conversion book value (B) $ 14,102,000 Pre conversion tang, book value (TB) $ 14,102,000 Pre conversion assets (A) $ 313,424,000 Conversion expense (X) 5.54% Percent sold (POT) 45.00% ESOP stock purchase (E) 3.15% Option % granted (OP) 0.00% ESOP cost of borrowings, net (S) 0.00% Est. option value (OV) 0.00% ESOP term (yrs.) (T) 25 Option maturity (OM) 0.00% RRP amount (M) 0.00% Option % taxable (OT) 0.00% RRP term (yrs.) (N) 0 Price per share (P) $ 10.00 Tax rate (TAX) 21.00% Investment rate of return, pretax 2.85% Investment rate of return, net (RR) 2.25% Formulae to indicate value after conversion: 1. P/CE method: Value = P/CE*CY = ((1-P/CE*(PCT)*((1-X-E-M)*(RR*(1-TAX))-((1-TAX)*E/T)-((1-TAX)*M/N)-((1-TAX)*OT)*(OP*OV)/OM))) $ NM 2. P/B method: Value = P/B*(B) = (1-PB*(PCT)*(1-X-E-M)) $ 23,000,000 3. P/A method: Value = P/A*(A) = (1-PA*(PCT)*(1-X-E-M)) $ 23,000,000 VALUATION CORRELATION AND CONCLUSIONS: Share Pricee Public Shares Sold Gross Proceeds of Public Offering MHC Shares Issued Total Shares Issued TOTAL VALUE Midpoint 10.00 1,035,000 $10,350,000 1,265,000 2,300,000 $23,000,000 Minimum 10.00 879,750 $8,797,500 1,075,250 1,955,000 $19,550,000 Maximum 10.00 1,190,250 $11,902,500 1,454,750 2,645,000 $26,450,000 Maximum, as adjusted 10.00 1,368,788 $13,687,875 1,672,963 3,041,750 $30,417,500

 

   

 

 

 

EXHIBIT 56 KELLER & COMPANY Columbus, Ohio 614-766-1426 PROJECTED EFFECT OF CONVERSION PROCEEDS THE EQUITABLE BANK, S.S.B. Minority Offering at the MINIMUM 1. Gross Offering Proceeds Offering proceeds (1) $ 8,797,500 Less: Estimated offering expenses 1,275,000 Net offering proceeds $ 7,522,500 2. Generation of Additional Income Net offering proceeds $ 7,522,500 Less: Stock-based benefit plans (2) 615,825 Less: MHC capitalization 100,000 Net offering proceeds invested $ 6,806,675 Investment rate, after taxes 2.25% Earnings increase - return on proceeds invested $ 153,252 Less: Estimated cost of ESOP borrowings 0 Less: Amortization of ESOP borrowings, net of taxes 19,460 Less: Stock-based incentive plan expense, net of taxes 0 Less: Option expense, net of applicable taxes 0 Net earnings increase (decrease) $ 133,792 3. Comparative Pro Forma Earnings Net Core Before conversion -12 months ended 6/30/18 $ (367,000) $ (133,000) Net earnings increase (decrease) 133,792 133,792 After conversion $ (233,208) $ 792 4. Comparative Pro Forma Net Worth (3) Total Tangible Before conversion - 6/30/18 $ 14,102,000 $ 14,102,000 Net cash conversion proceeds 6,806,675 6,806,675 MHC consolidation 0 0 After conversion $ 20,908,675 $ 20,908,675 5. Comparative Pro Forma Assets Before conversion - 6/30/18 $ 313,424,000 Net cash conversion proceeds 6,806,675 MHC consolidation 0 After conversion $ 320,230,675 (1) Represents gross proceeds of public offering. (2) Represents ESOP and stock-based incentive plans.. (3) ESOP and RRP are omitted from net worth.

 

   

 

 

 

EXHIBIT 57 KELLER & COMPANY Columbus, Ohio 614-766-1426 PROJECTED EFFECT OF CONVERSION PROCEEDS THE EQUITABLE BANK, S.S.B. Minority Offering at the MIDPOINT 1. Gross Offering Proceeds Offering proceeds (1) $ 10,350,000 Less: Estimated offering expenses 1,275,000 Net offering proceeds $ 9,075,000 2. Generation of Additional Income Net offering proceeds $ 9,075,000 Less: Stock-based benefit plans (2) 724,500 Less: MHC capitalization 100,000 Net offering proceeds invested $ 8,250,500 Investment rate, after taxes 2.25% Earnings increase - return on proceeds invested $ 185,760 Less: Estimated cost of ESOP borrowings 0 Less: Amortization of ESOP borrowings, net of taxes 22,894 Less: Stock-based incentive plan expense, net of taxes 0 Less: Option expense, net of applicable taxes 0 Net earnings increase (decrease) $ 162,866 3. Comparative Pro Forma Earnings Regular Core Before conversion -12 months ended 6/30/18 $ (367,000) $ (133,000) Net earnings increase 162,866 162,866 After conversion $ (204,134) $ 29,866 4. Comparative Pro Forma Net Worth (3) Total Tangible Before conversion - 6/30/18 $ 14,102,000 $ 14,102,000 Net cash conversion proceeds 8,250,500 8,250,500 MHC consolidation 0 0 After conversion $ 22,352,500 $ 22,352,500 5. Comparative Pro Forma Assets Before conversion - 6/30/18 $ 313,424,000 Net cash conversion proceeds 8,250,500 MHC consolidation 0 After conversion $ 321,674,500 (1) Represents gross proceeds of public offering. (2) Represents ESOP and stock-based incentive plans. (3) ESOP and RRP are omitted from net worth.

 

   

 

 

 

EXHIBIT 58 KELLER & COMPANY Columbus, Ohio 614-766-1426 PROJECTED EFFECT OF CONVERSION PROCEEDS THE EQUITABLE BANK, S.S.B. Minority Offering at the MAXIMUM 1. Gross Offering Proceeds Offering proceeds (1) $ 11,902,500 Less: Estimated offering expenses 1,275,000 Net offering proceeds $ 10,627,500 2. Generation of Additional Income Net offering proceeds $ 10,627,500 Less: Stock-based benefit plans (2) 833,175 Less: MHC capitalization 100,000 Net offering proceeds invested $ 9,694,325 Investment rate, after taxes 2.25% Earnings increase - return on proceeds invested $ 218,268 Less: Estimated cost of ESOP borrowings 0 Less: Amortization of ESOP borrowings, net of taxes 26,328 Less: Stock-based incentive plan expense, net of taxes 0 Less: Option expense, net of applicable taxes 0 Net earnings increase (decrease) $ 191,939 3. Comparative Pro Forma Earnings Regular Core Before conversion -12 months ended 6/30/18 $ (367,000) $ (133,000) Net earnings increase 191,939 191,939 After conversion $ (175,061) $ 58,939 4. Comparative Pro Forma Net Worth (3) Total Tangible Before conversion - 6/30/18 $ 14,102,000 $ 14,102,000 Net cash conversion proceeds 9,694,325 9,694,325 MHC consolidation 0 0 After conversion $ 23,796,325 $ 23,796,325 5. Comparative Pro Forma Assets Before conversion - 6/30/18 $ 313,424,000 Net cash conversion proceeds 9,694,325 MHC consolidation 0 After conversion $ 323,118,325 (1) Represents gross proceeds of public offering. (2) Represents ESOP and stock-based incentive plans. (3) ESOP and RRP are omitted from net worth.

 

   

 

 

 

EXHIBIT 59 KELLER & COMPANY Columbus, Ohio 614-766-1426 PROJECTED EFFECT OF CONVERSION PROCEEDS THE EQUITABLE BANK, S.S.B. Minority Offering at the Maximum, as adjusted 1. Gross Offering Proceeds Offering proceeds (1) $ 13,687,875 Less: Estimated offering expenses 1,275,000 Net offering proceeds $ 12,412,875 2. Generation of Additional Income Net offering proceeds $ 12,412,875 Less: Stock-based benefit plans (2) 958,151 Less: MHC capitalization 100,000 Net offering proceeds invested $ 11,354,724 Investment rate, after taxes 2.25% Earnings increase - return on proceeds invested $ 255,652 Less: Estimated cost of ESOP borrowings 0 Less: Amortization of ESOP borrowings, net of taxes 30,278 Less: Stock-based incentive plan expense, net of taxes 0 Less: Option expense, net of applicable taxes 0 Net earnings increase (decrease) $ 225,374 3. Comparative Pro Forma Earnings Regular Core Before conversion -12 months ended 6/30/18 $ (367,000) $ (133,000) Net earnings increase 225,374 225,374 After conversion $ (141,626) $ 92,374 4. Comparative Pro Forma Net Worth (3) Total Tangible Before conversion - 6/30/18 $ 14,102,000 $ 14,102,000 Net cash conversion proceeds 11,354,724 11,354,724 MHC consolidation 0 0 After conversion $ 25,456,724 $ 25,456,724 5. Comparative Pro Forma Assets Before conversion - 6/30/18 $ 313,424,000 Net cash conversion proceeds 11,354,724 MHC consolidation 0 After conversion $ 324,778,724 (1) Represents gross proceeds of public offering. (2) Represents ESOP and stock-based incentive plans. (3) ESOP and RRP are omitted from net worth.

 

   

 

 

 

EXHIBIT 60 KELLER & COMPANY Columbus, Ohio 614-766-1426 MINORITY OFFERING SUMMARY OF VALUATION PREMIUM OR DISCOUNT THE EQUITABLE BANK, S.S.B. Premium or (discount)

from comparable group. The Equitable Bank. S.S.B. Average Median Midpoint: Price/earnings NM x NM NM Price/book value 102.90 % * -7.18% -8.20% Price/assets 7.15 % -47.56% -45.84% Price/tangible book value 102.90 % -13.17% -12.81% Price/core earnings NM x NM NM Minimum of range: Price/earnings NM x NM NM Price/book value 93.50 % * -15.65% -16.58% Price/assets 6.10 % -55.22% -53.75% Price/tangible book value 93.50 % -21.10% -20.77% Price/core earnings NM x NM NM Maximum of range: Price/earnings NM x NM NM Price/book value 111.15% * 0.27% -0.83% Price/assets 8.19 % -39.96% -37.99% Price/tangible book value 111.15 % -6.20% -5.81% Price/core earnings NM X NM NM Super maximum of range: Price/earnings NM x NM NM Price/book value 119.49 % * 7.79% 6.60% Price/assets 9.37 % -31.31% -29.05% Price/tangible book value 119.49 % 0.83% 1.25% Price/core earnings NM X NM NM * Represents pricing ratio associated with primary valuation method.

 

   

 

 

 

ALPHABETICAL EXHIBITS

 

   

 

 

 

EXHIBIT A KELLER & COMPANY, INC. Financial Institution Consultants 555 Metro Place North, Suite 524 614-766-1426 Dublin, Ohio 43017 (fax) 614-766-1459 PROFILE OF THE FIRM KELLER & COMPANY, INC. is a national consulting firm to financial institutions, serving clients throughout the United States from its office in Dublin, Ohio. Since our inception in 1985, we have provided a wide range of consulting services to over 250 financial institutions including banks, thrifts, mortgage companies, insurance companies and holding companies from Oregon to Maine. Services offered by Keller & Company include the preparation of stock and ESOP valuations, fairness opinions, business and strategic plans, capital plans, financial models and projections, market studies, de novo charter and deposit insurance applications, incentive compensation plans, compliance policies, lending, underwriting and investment criteria, and responses to regulatory comments. Keller & Company also serves as advisor in merger/acquisition, deregistration, going private, secondary offering and branch purchase/sale transactions. Keller & Company is additionally active in loan review, director and management review, product analysis and development, performance analysis, compensation review, policy development, charter conversion, data processing, information technology systems, and conference planning and facilitation. Keller & Company is one of the leading firms in the U.S. with regard to the completion of ESOP valuations for financial institutions and prepares over 25 ESOP valuations a year. Keller is also one of the leading conversion appraisal firms in the United States. Keller has on-line access to current and historical financial, organizational and demographic data for every financial institution and financial institution holding company in the United States as well as daily pricing data and ratios for all publicly traded financial institutions. Keller & Company is an experienced appraiser of financial institutions for filing conversion appraisals with the Federal Deposit Insurance Corporation, the Office of the Comptroller of the Currency, the Federal Reserve Board and numerous state government agencies, and is also approved by the Internal Revenue Service as an expert in financial institution stock valuations. Each of the firm's senior consultants has over thirty years of front line experience and accomplishment in various areas of the financial institution, regulatory and real estate sectors, offering clients distinct and diverse areas of expertise. It is the goal of Keller & Company to provide specific and ongoing relationship-based services that are pertinent, focused and responsive to the needs of the individual client institution within the changing industry environment, and to offer those services at reasonable fees on a timely basis. In recent years, Keller & Company has become one of the leading and most recognized financial institution consulting firms in the nation.

 

   

 

 

 

CONSULTANTS IN THE FIRM MICHAEL R. KELLER has over thirty years experience as a consultant to the financial institution industry. Immediately following his graduation from college, Mr. Keller took a position as an examiner of financial institutions in northeastern Ohio with a focus on Cleveland area institutions. After working two years as an examiner, Mr. Keller entered Ohio State University full time to obtain his M.B.A. in Finance. Mr. Keller then worked as an associate for a management consulting firm specializing in services to financial institutions immediately after receiving his M.B.A. During his eight years with the firm, he specialized in mergers and acquisitions, branch acquisitions and sales, branch feasibility studies, stock valuations, charter applications, and site selection analyses. By the time of his departure, he had attained the position of vice president, with experience in almost all facets of banking operations. Prior to forming Keller & Company, Mr. Keller also worked as a senior consultant in a larger consulting firm. In that position, he broadened his activities and experience, becoming more involved with institutional operations, business and strategic planning, regulatory policies and procedures, performance analysis, conversion appraisals, and fairness opinions. Mr. Keller established Keller & Company in November 1985 to better serve the needs of the financial institution industry. Mr. Keller graduated from the College of Wooster with a B. A. in Economics in 1972, and later received an M.B.A. in Finance in 1976 from the Ohio State University where he took numerous courses in corporate stock valuations.

 

   

 

 

 

Consultants in the Firm (cont.) SUSAN H. O’DONNELL has twenty years of experience in the finance and accounting areas of the banking industry. At the start of her career, Ms. O’Donnell worked in public accounting for Coopers & Lybrand in Cincinnati and earned her CPA. Her clients consisted primarily of financial institutions and health care companies. Ms. O’Donnell then joined Empire Bank of America in Buffalo, New York. During her five years with Empire, Ms. O’Donnell progressed to the level of Vice President and was responsible for SEC, FHLB and internal financial reporting. She also coordinated the offering circular for its initial offering of common stock. Ms. O’Donnell later joined Banc One Corporation where she worked for eleven years. She began her career at Banc One in the Corporate Accounting Department where she was responsible for SEC, Federal Reserve and investor relations reporting and coordinated the offering documents for stock and debt offerings. She also performed acquisition work including regulatory applications and due diligence and established accounting policies and procedures for all affiliates. Ms. O’Donnell later moved within Banc One to the position of chief financial officer of the Personal Trust business responsible for $225 million in revenue. She then provided leadership as the Director of Personal Trust Integration responsible for various savings and revenue enhancements related to the Bank One/First Chicago merger. Ms. O’Donnell graduated from Miami University with a B.S. in Business. She also completed the Leading Strategic Change Program at The Darden School of Business and the Banc One Leadership Development Program.

 

   

 

 

 

Consultants in the Firm (cont.) JOHN A. SHAFFER has over thirty years experience in banking, finance, real estate lending, and development. Following his university studies, Mr. Shaffer served as a lending officer for a large real estate investment trust, specializing in construction and development loans. Having gained experience in loan underwriting, management and workout, he later joined Chemical Bank of New York and was appointed Vice President for Loan Administration of Chemical Mortgage Company in Columbus, Ohio. At Chemical, he managed all commercial and residential loan servicing, administering a portfolio in excess of $2 billion. His responsibilities also included the analysis, management and workout of problem commercial real estate loans and equity holdings, and the structuring, negotiation, acquisition and sale of loan servicing, mortgage and equity securities and real estate projects. Mr. Shaffer later formed and managed an independent real estate and financial consulting firm, serving corporate and institutional clients, and also investing in and developing real estate. Mr. Shaffer's primary activities and responsibilities have included financial analysis, projection and modeling, asset and liability management, real estate finance and development, loan management and workout, organizational and financial administration, budgeting, cash flow management and project design. Mr. Shaffer graduated from Syracuse University with a B.S. in Business Administration, later receiving an M.B.A. in Finance and a Ph.D. in Economics from New York University.

 

   

 

 

 

EXHIBIT B RB 20 CERTIFICATION I hereby certify that I have not been the subject of any criminal, civil or administrative judgments, consents, undertakings or orders, or any past administrative proceedings (excluding routine or customary audits, inspections and investigation) issued by any federal or state court, any department, agency, or commission of the U.S. Government, any state or municipality, any self-regulatory trade or professional organization, or any foreign government or governmental entity, which involve: (i) commission of a felony, fraud, moral turpitude, dishonesty or breach of trust; (ii) violation of securities or commodities laws or regulations; (iii) violation of depository institution laws or regulations; (iv) violation of housing authority laws or regulations; (v) violation of the rules, regulations, codes or conduct or ethics of a self-regulatory trade or professional organization; (vi) adjudication of bankruptcy or insolvency or appointment of a receiver, conservator, trustee, referee, or guardian. I hereby certify that the statements I have made herein are true, complete and correct to the best of my knowledge and belief. Conversion Appraiser Date Michael R. Keller

 

   

 

 

 

EXHIBIT C AFFIDAVIT OF INDEPENDENCE STATE OF OHIO, COUNTY OF FRANKLIN, ss: I, Michael R. Keller, being first duly sworn hereby depose and say that: The fee which I received directly from the applicant, The Equitable Bank, S.S.B., in the amount of $35,000 for the performance of my appraisal was not related to the value determined in the appraisal and that the undersigned appraiser is independent and has fully disclosed any relationships which may have a material bearing upon the question of my independence; and that any indemnity agreement with the applicant has been fully disclosed. Further, affiant sayeth naught. MICHAEL R. KELLER Sworn to before me and subscribed in my presence this 27th day of August 2018. NOTARY PUBLIC JANET M MOHR NOTARY PUBLIC-OHIO UNION COUNTY MY COMMISSION EXPIRES DECEMBER 2, 2022