Investor Relations

SB Financial Group Announces Fourth Quarter 2020 Results

Company Release -

1/28/2021 4:15 PM ET

DEFIANCE, Ohio, Jan. 28, 2021 /PRNewswire/ -- SB Financial Group, Inc. (NASDAQ: SBFG) ("SB Financial" or the "Company"), a diversified financial services company providing full-service community banking, mortgage banking, wealth management, private client and title insurance services today reported earnings for the fourth quarter and twelve months ended December 31, 2020.

Fourth quarter 2020 highlights over prior-year fourth quarter include:

Net income of $5.4 million up $2.0 million or 59.6 percent; diluted earnings per share ("EPS") of $0.71, up $0.29 per share or 69.0 percent
Adjusted net income, excluding the impact of the Originated Mortgage Servicing Rights ("OMSR") recapture, was $5.8 million, which yields an increase in adjusted EPS of $0.06 to $0.77
Mortgage origination volume of $169.0 million, an increase of $31.5 million, or 22.9 percent
Pre-tax, pre-provision income of $7.5 million, up $3.1 million or 70.6 percent

The twelve months ended December 31, 2020, highlights over the prior-year twelve months include:

Net income of $14.9 million; diluted EPS of $1.96
Adjusted net income, excluding the impact of OMSR and Edon merger costs, rose to $18.8 million, up $5.9 million, or 46.1 percent, with adjusted EPS of $2.44
Return on Average Assets ("ROAA") of 1.29 percent; adjusted ROAA of 1.61 percent
Loan growth of $47.2 million, or 5.7 percent, which includes Paycheck Protection Program ("PPP") loan balances and loans acquired in the Edon acquisition.
Deposit growth of $213.9 million, or 25.4 percent, driven by PPP balances and the Edon acquisition
Mortgage origination volume of $694.2 million; servicing portfolio of $1.3 billion, which is up $101 million, or 8.4 percent

Highlights	Three Months Ended			Twelve Months Ended
($ in thousands, except per share & ratios)	Dec. 2020	Dec. 2019	% Change	Dec. 2020	Dec. 2019	% Change
Operating revenue	$ 18,153	$ 14,555	24.7%	$ 66,026	$ 52,842	24.9%
Interest income	10,589	11,205	-5.5%	42,635	44,400	-4.0%
Interest expense	1,338	2,609	-48.7%	6,705	9,574	-30.0%
Net interest income	9,251	8,596	7.6%	35,930	34,826	3.2%
Provision for loan losses	800	300	166.7%	4,500	800	462.5%
Noninterest income	8,902	5,959	49.4%	30,096	18,016	67.1%
Noninterest expense	10,684	10,176	5.0%	43,087	37,410	15.2%
Net income	5,358	3,358	59.6%	14,944	11,973	24.8%
Earnings per diluted share	0.71	0.42	69.0%	1.96	1.51	29.8%
Return on average assets	1.73%	1.28%	35.2%	1.29%	1.16%	11.2%
Return on average equity	15.05%	9.93%	51.6%	10.74%	8.99%	19.5%

Non-GAAP Measures
Adjusted net income	$ 5,841	$ 3,119	87.3%	$ 18,757	$ 12,838	46.1%
Adjusted diluted EPS	0.77	0.39	97.4%	2.44	1.62	50.6%
Adjusted return on average assets	1.89%	1.26%	50.0%	1.61%	1.24%	29.8%
Adjusted pre-tax, pre-provision income	8,172	4,076	100.5%	19,685	16,526	19.1%

"The fourth quarter completed a record year of earnings for our Company. We earned $0.71 per share in the quarter up 69 percent from the prior year and for the full year $1.96, which was up 30 percent over the prior twelve months," said Mark A. Klein, Chairman, President, and CEO of SB Financial. "We had significant contributions from our lending teams in the PPP initiative and our Residential Mortgage group originated record volume during 2020. We were especially pleased to have returned over $10 million to our shareholders in the form of dividends and buybacks this past year and to have increased shareholder book value by nearly 11 percent."

RESULTS OF OPERATIONS

Consolidated Revenue

Total operating revenue, consisting of net interest income and noninterest income, was up 24.7 percent from the fourth quarter of 2019 and for the year was up 24.9 percent.

Net interest income was up 7.6 percent from the year-ago quarter, and remained flat to the linked quarter.
Net interest margin on a fully taxable equivalent basis (FTE) was down from the year-ago quarter by 49 basis points and down 20 basis points from the linked quarter due to higher transactional cash balances, slower PPP forgiveness realization and lower mortgage volume. Loan yields are down 60 bps with the decline in the rate curve.
Noninterest income was up 49.4 percent year over year but down 14.5 percent from the linked quarter, due to servicing rights impairment and lower mortgage volume.

Mortgage Loan Business

Mortgage loan originations for the fourth quarter of 2020 were $169.0 million, up $31.5 million, or 22.9 percent, from the year-ago quarter. Total sales of originated loans were $143.2 million, up $15.7 million, or 12.3 percent. For the full year, SB Financial had total volume of $694.2 million, of which $290.9 million (42 percent) was new purchase/construction lending, $217.0 million (31 percent) was internal refinance, and the remaining $186.3 million (27 percent) was new customer refinance volume.

Net mortgage banking revenue, consisting of gains on the sale of mortgage loans and net loan servicing fees, was $6.2 million for the fourth quarter of 2020, compared to $3.4 million for the year-ago quarter. The mortgage servicing valuation adjustment for the fourth quarter of 2020 was a negative $0.6 million, compared to a positive adjustment of $0.3 million for the fourth quarter of 2019. For the year, the impairment on servicing rights was $3.6 million, compared to $1.1 million for the prior year. The aggregate servicing valuation impairment ended the quarter at $4.9 million. The servicing portfolio at December 31, 2020, was $1.3 billion up $100.6 million or 8.4 percent, from $1.2 billion at December 31, 2019. Normal amortization is up 124 percent from the prior year due to higher refinance activity.

Mr. Klein noted, "Our mortgage machine continued at a brisk pace in the quarter with nearly $170 million in volume and for the year we were just a few loans shy of $700 million. Our sales and processing teams set a new standard of excellence with over 3,100 units closed during the year, and the gain on sale yields continued at high levels in the quarter allowing us to overcome the effects of the servicing rights impairment. We can add to book value in the future with the potential realization of our $4.9 million in valuation impairment."

Mortgage Banking
($ in thousands)	Dec. 2020	Sep. 2020	Jun. 2020	Mar. 2020	Dec. 2019
Mortgage originations	$ 168,997	$ 200,158	$ 223,671	$ 101,365	$ 137,528
Mortgage sales	143,151	166,201	204,628	84,476	127,441
Mortgage servicing portfolio	1,299,698	1,293,037	1,261,746	1,216,292	1,199,107
Mortgage servicing rights	7,759	8,535	8,168	8,974	11,017


Mortgage servicing revenue
Loan servicing fees	857	813	782	757	740
OMSR amortization	(1,283)	(1,308)	(1,574)	(597)	(709)
Net administrative fees	(426)	(495)	(792)	160	31
OMSR valuation adjustment	(611)	326	(1,088)	(2,212)	303
Net loan servicing fees	(1,037)	(169)	(1,880)	(2,052)	334
Gain on sale of mortgages	7,197	8,085	8,119	1,949	3,048
Mortgage banking revenue, net	$ 6,160	$ 7,916	$ 6,239	$ (103)	$ 3,382

Noninterest Income and Noninterest Expense

SB Financial's noninterest income includes revenue from a diverse group of services, such as wealth management, deposit fees, residential loan sales and the sale of Small Business Administration (SBA) and U.S. Department of Agriculture (USDA) loans. Wealth management assets under the Company's care were $558.4 million as of December 31, 2020, up $50.7 million, or 10.0 percent, compared to the prior year. For the fourth quarter of 2020, noninterest income as a percentage of total operating revenue was 49.0 percent. Reflective of the robust mortgage market, SB Financial'sTitle Agency provided revenue in the quarter of $0.5 million, up 32.8 percent from the prior year.

For the fourth quarter of 2020, noninterest expense of $10.7 million was up $0.5 million year over year or 5.0 percent reflecting a 4.9 times positive operating leverage. On a full year basis, noninterest expense of $43.1 million is up $5.7 million or 15.2 percent. Operating leverage for the year was a positive 1.6 times, however when adjusted for the Edon merger costs, operating leverage improves to 2.1 times.

Mr. Klein stated, "We continued to see the positive effects to net income this quarter from the resources we have allocated to our revenue lines. Our commitment to technology, hedging and geographic expansion continued to pay dividends as our revenue growth exceeded expense growth by over two times and we continue to realize significant benefits from our commitment to the mortgage business line for each of our stakeholders."

Noninterest Income / Noninterest Expense
($ in thousands, except ratios)	Dec. 2020	Sep. 2020	Jun. 2020	Mar. 2020	Dec. 2019
Noninterest Income (NII)	$ 8,902	$ 10,418	$ 8,615	$ 2,161	$ 5,959
NII / Total Revenue	49.0%	52.9%	49.3%	20.2%	40.9%
NII / Average Assets	2.9%	3.4%	3.0%	0.8%	2.3%
Total Revenue Growth	24.7%	36.4%	39.6%	-5.6%	16.0%

Noninterest Expense (NIE)	$ 10,684	$ 11,335	$ 11,662	$ 9,406	$ 10,176
Efficiency Ratio	58.8%	57.5%	66.7%	87.8%	69.9%
NIE / Average Assets	3.5%	3.7%	4.0%	3.5%	3.9%
Net Noninterest Expense/Avg. Assets	-0.6	-0.3	-1.0%	-2.7%	-1.6%
Total Expense Growth	5.0%	19.3%	28.0%	9.0%	15.0%
Operating Leverage	4.9	1.9	1.4	-0.6	1.1

Balance Sheet

Total assets as of December 31, 2020, were $1.26 billion, up $219.3 million, or 21.1 percent, from the year ago quarter due to the impact of the Edon acquisition and the PPP activity. Total equity as of December 31, 2020, was $142.9 million, up 5.0 percent from a year ago, and comprised 11.4 percent of total assets.

Total loans held for investment were $872.7 million at December 31, 2020, up $47.2 million, or 5.7 percent, from December 31, 2019. Commercial loans were up $52.2 million, or 34.6 percent, commercial real estate up $1.0 million or 0.3 percent and agricultural loans increasing $4.3 million, or 8.3 percent. Absent the effects of the Edon acquisition and PPP loans, loan balances were down $44.7 million from the year ago quarter.

The investment portfolio of $154.7 million, including shares in the Federal Reserve Bank and Federal Home Loan Bank, represented 12.3 percent of assets at December 31, 2020, and was up 46.5 percent from the year-ago period. Deposit balances of $1.05 billion at December 31, 2020, increased by $213.9 million, or 25.5 percent, since December 31, 2019. Growth from the prior year included $144.1 million in checking and $69.8 million in savings and time deposit balances.

Mr. Klein continued, "We allocated more to our loan loss allowance in the quarter despite what we see as relatively stable asset quality. We continue to prepare for potential COVID impacts to our clients and other credit unknowns. For the year, we set aside $4.5 million in provision expense compared to credit losses of $0.7 million. We have been able to offset the provision expense with our PPP revenue and the pandemic related expense reductions we realized during the year. Adjusting for our PPP balances, our reserve level ended the year at $12.6 million, or 1.56 percent of loans, compared to the $8.8 million and 1.06 percent at the end of the prior year."

Loan Balances
($ in thousands, except ratios)	Dec. 2020	Sep. 2020	Jun. 2020	Mar. 2020	Dec. 2019	Annual Growth
Commercial	$ 203,256	$ 216,667	$222,108	$151,538	$151,018	$ 52,238
% of Total	23.3%	24.5%	24.6%	18.2%	18.3%	34.6%
Commercial RE	370,984	371,947	375,450	378,212	369,962	1,022
% of Total	42.5%	42.0%	41.6%	45.5%	44.8%	0.3%
Agriculture	55,251	57,420	58,817	47,660	50,994	4,257
% of Total	6.3%	6.5%	6.5%	5.7%	6.2%	8.3%
Residential RE	182,076	178,393	184,684	189,738	189,290	(7,214)
% of Total	20.9%	20.1%	20.6%	22.9%	22.9%	-3.8%
Consumer & Other	61,156	61,423	60,489	63,616	64,246	(3,090)
% of Total	7.0%	6.9%	6.7%	7.7%	7.8%	-4.8%
Total Loans	$ 872,723	$ 885,850	$901,548	$830,764	$825,510	$ 47,213
Total Growth Percentage						5.7%


Deposit Balances
($ in thousands, except ratios)	Dec. 2020	Sep. 2020	Jun. 2020	Mar. 2020	Dec. 2019	Annual Growth
Non-Int DDA	$ 251,649	$ 225,003	$229,042	$170,920	$158,357	$ 93,292
% of Total	24.0%	22.2%	23.1%	19.8%	18.8%	58.9%
Interest DDA	176,785	164,248	154,143	133,722	131,084	45,701
% of Total	16.9%	16.2%	15.6%	15.5%	15.6%	34.9%
Savings	174,864	169,474	161,182	138,863	119,359	55,505
% of Total	16.7%	16.7%	16.2%	16.0%	14.1%	46.5%
Money Market	216,164	204,862	189,380	169,209	173,666	42,498
% of Total	20.6%	20.2%	19.1%	19.6%	20.7%	24.5%
Time Deposits	229,549	250,428	256,840	251,177	257,753	(28,204)
% of Total	21.9%	24.7%	25.9%	29.2%	30.9%	-10.9%
Total Deposits	$1,049,011	$1,014,015	$990,587	$863,891	$840,219	$ 208,792
Total Growth Percentage						24.8%

Asset Quality

SB Financial reported nonperforming assets of $7.3 million as of December 31, 2020, up $0.6 million from the year-ago quarter. The coverage of nonperforming loans by the loan loss allowance was at 174 percent at December 31, 2020, up from 137 percent at December 31, 2019.

Nonperforming Assets						Annual Change
($ in thousands, except ratios)	Dec. 2020	Sep. 2020	Jun. 2020	Mar. 2020	Dec. 2019	Annual Change
Commercial & Agriculture	$ 902	$ 1,140	$ 1,204	$ 1,309	$ 1,772	$ (870)
% of Total Com./Ag. loans	0.35%	0.42%	0.43%	0.66%	0.88%	-49.1%
Commercial RE	2,412	2,475	2,484	1,816	1,826	586
% of Total CRE loans	0.65%	0.67%	0.66%	0.48%	0.49%	32.1%
Residential RE	2,704	2,481	2,538	2,330	1,635	1,069
% of Total Res. RE loans	1.49%	1.39%	1.37%	1.23%	0.86%	65.4%
Consumer & Other	408	313	308	327	267	141
% of Total Con./Oth. loans	0.67%	0.51%	0.51%	0.51%	0.42%	52.8%
Total Nonaccruing Loans	6,426	6,409	6,534	5,782	5,500	926
% of Total loans	0.74%	0.72%	0.72%	0.70%	0.67%	16.8%
Accruing Restructured Loans	810	789	804	816	874	(64)
Total Change (%)						-7.3%
Total Nonaccruing & Restructured Loans	7,236	7,198	7,338	6,598	6,374	862
% of Total loans	0.83%	0.81%	0.81%	0.79%	0.77%	13.5%
Foreclosed Assets	23	76	382	85	305	(282)
Total Change (%)						-92.5%
Total Nonperforming Assets	$ 7,259	$ 7,274	$ 7,720	$ 6,683	$ 6,679	$ 580
% of Total assets	0.58%	0.60%	0.64%	0.61%	0.64%	8.7%

The Company continued to provide payment relief to clients as needed, with total forbearance as of December 31, 2020 of 83 loans at $39.7 million. The detail on these deferrals; 9 commercial at $28.0 million down $8.3 million from the linked quarter, zero portfolio residential and consumer loans, down $2.0 million from the linked quarter and 74 sold residential real estate loans at $11.7 million, down $30.6 million from the linked quarter.

Loans in Deferral Status				Linked Qtr. Change
($ in thousands, except ratios)	Dec. 2020	Sep. 2020	Jun. 2020	Linked Qtr. Change

Total Commercial	$ 28,032	$ 36,366	$142,682	$ (8,334)

Total Consumer	-	28	350	(28)

Total Portfolio Mortgage	-	1,959	10,274	(1,959)
Total Balance Sheet Deferrals	$ 28,032	$ 38,353	$153,306	$ (10,321)

% of Total loans	3.21%	4.33%	17.00%	-1.12%

Total Sold Mortgage	$ 11,685	$ 42,317	$ 41,751	$ (30,632)

Webcast and Conference Call

The Company will hold a related conference call and webcast on January 29, 2021, at 11:00 a.m. EST. Interested parties may access the conference call by dialing 1-888-338-9469. The webcast can be accessed at ir.yourstatebank.com. An audio replay of the call will be available on the Company's website.

About SB Financial Group

Headquartered in Defiance, Ohio, SB Financial is a diversified financial services holding company for the State Bank & Trust Company (State Bank) and SBFG Title, LLC dba Peak Title (Peak Title). State Bank provides a full range of financial services for consumers and small businesses, including wealth management, private client services, mortgage banking and commercial and agricultural lending, operating through a total of 22 offices; 21 in nine Ohio counties and one in Fort Wayne, Indiana, and 23 full-service ATMs. State Bank has five loan production offices located throughout the Tri-State region of Ohio, Indiana and Michigan. Peak Title provides title insurance and opinions throughout the Tri-State region. SB Financial's common stock is listed on the NASDAQ Capital Market under the symbol "SBFG".

In May 2020, SB Financial was ranked #125 on the American Banker Magazine's list of Top 200 Publicly Traded Community Banks and Thrifts based on three-year average return on equity ("ROE").

Forward-Looking Statements

Certain statements within this document, which are not statements of historical fact, constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve risks and uncertainties and actual results may differ materially from those predicted by the forward-looking statements. These risks and uncertainties include, but are not limited to, the duration and scope of the COVID-19 outbreak in the United States and the market areas in which SB Financial and its subsidiaries operate, including the impact to the state and local economies of prolonged shelter in place orders and the pandemic generally, risks and uncertainties inherent in the national and regional banking industry, changes in economic conditions in the market areas in which SB Financial and its subsidiaries operate, changes in policies by regulatory agencies, changes in accounting standards and policies, changes in tax laws, fluctuations in interest rates, demand for loans in the market areas in SB Financial and its subsidiaries operate, increases in FDIC insurance premiums, changes in the competitive environment, losses of significant customers, geopolitical events, the loss of key personnel and other risks identified in SB Financial's Annual Report on Form 10-K and documents subsequently filed by SB Financial with the Securities and Exchange Commission. Forward-looking statements speak only as of the date on which they are made, and SB Financial undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made, except as required by law. All subsequent written and oral forward-looking statements attributable to SB Financial or any person acting on its behalf are qualified by these cautionary statements.

Non-GAAP Financial Measures

This press release contains financial information determined by methods other than in accordance with U.S. generally accepted accounting principles ("GAAP"). Non-GAAP financial measures, specifically pre-tax, pre-provision income, tangible common equity, tangible assets, tangible book value per common share, tangible common equity to tangible assets, return on average tangible common equity, total interest income – FTE, net interest income – FTE and net interest margin – FTE are used by the Company's management to measure the strength of its capital and analyze profitability, including its ability to generate earnings on tangible capital invested by its shareholders. In addition, the Company excludes the non-GAAP items of OMSR impairment and merger related costs from net income to report an adjusted net income level. Although management believes these non-GAAP measures are useful to investors by providing a greater understanding of its business, they should not be considered a substitute for financial measures determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies.

		SB FINANCIAL GROUP, INC.
		CONSOLIDATED BALANCE SHEETS - (Unaudited)

				December	September	June	March	December
			($ in thousands)	2020	2020	2020	2020	2019

ASSETS
	Cash and due from banks			$ 142,225	$ 94,641	$ 85,661	$ 56,393	$ 27,064
	Interest bearing time deposits			4,288	8,956	10,542	-	-
	Available-for-sale securities			149,406	130,315	104,289	107,727	100,948
	Loans held for sale			7,234	13,943	13,742	11,328	7,258
	Loans, net of unearned income			872,723	885,850	901,548	830,764	825,510
	Allowance for loan losses			(12,574)	(11,793)	(10,013)	(8,958)	(8,755)
	Premises and equipment, net			23,557	23,785	23,662	23,599	23,385
	Federal Reserve and FHLB Stock, at cost			5,303	5,303	4,837	4,648	4,648
	Foreclosed assets held for sale, net			23	76	382	85	305
	Interest receivable			3,799	4,159	4,272	2,940	3,106
	Goodwill			22,745	22,091	22,117	17,792	17,792
	Cash value of life insurance			17,530	17,453	17,375	17,299	17,221
	Mortgage servicing rights			7,759	8,535	8,168	8,974	11,017
	Other assets			13,821	14,927	16,354	15,722	9,078

			Total assets	$ 1,257,839	$ 1,218,241	$ 1,202,936	$ 1,088,313	$ 1,038,577



LIABILITIES AND SHAREHOLDERS' EQUITY
	Deposits
		Non interest bearing demand		$ 251,649	$ 225,003	$ 229,042	$ 170,920	$ 158,357
		Interest bearing demand		176,785	164,248	154,143	133,722	131,084
		Savings		174,864	169,474	161,182	138,863	119,359
		Money market		216,164	204,862	189,380	169,209	173,666
		Time deposits		229,549	250,428	256,840	251,177	257,753

			Total deposits	1,049,011	1,014,015	990,587	863,891	840,219

	Short-term borrowings			20,189	20,710	23,826	36,881	12,945
	Federal Home Loan Bank advances			8,000	8,000	13,000	16,000	16,000
	Trust preferred securities			10,310	10,310	10,310	10,310	10,310
	Interest payable			616	946	929	1,131	1,191
	Other liabilities			26,790	22,913	26,403	24,195	21,818

			Total liabilities	1,114,916	1,076,894	1,065,055	952,408	902,483

	Shareholders' Equity
		Preferred stock		-	-	-	-	-
		Common stock		54,463	54,463	54,463	54,463	54,463
		Additional paid-in capital		14,845	14,782	14,780	14,655	15,023
		Retained earnings		84,578	80,012	75,526	72,641	72,704
		Accumulated other comprehensive income (loss)		2,210	2,221	2,320	2,049	659
		Treasury stock		(13,173)	(10,131)	(9,208)	(7,903)	(6,755)

			Total shareholders' equity	142,923	141,347	137,881	135,905	136,094

			Total liabilities and shareholders' equity	$ 1,257,839	$ 1,218,241	$ 1,202,936	$ 1,088,313	$ 1,038,577




	SB FINANCIAL GROUP, INC.
	CONSOLIDATED STATEMENTS OF INCOME - (Unaudited)

($ in thousands, except per share & ratios)			At and for the Three Months Ended					Twelve Months Ended

			December	September	June	March	December	December	December
Interest income			2020	2020	2020	2020	2019	2020	2019
	Loans
	Taxable		$ 9,816	$ 10,179	$ 9,945	$ 9,795	$ 10,313	$ 39,735	$ 40,529
	Tax exempt		54	47	59	79	83	239	300
	Securities
	Taxable		632	494	510	692	737	2,328	3,226
	Tax exempt		87	87	81	78	72	333	345

		Total interest income	10,589	10,807	10,595	10,644	11,205	42,635	44,400

Interest expense
	Deposits		1,218	1,423	1,549	1,880	2,392	6,070	8,660
	Repurchase agreements & other		10	12	20	28	17	70	82
	Federal Home Loan Bank advances		58	59	92	100	101	309	402
	Trust preferred securities		52	54	62	88	99	256	430

		Total interest expense	1,338	1,548	1,723	2,096	2,609	6,705	9,574


Net interest income			9,251	9,259	8,872	8,548	8,596	35,930	34,826

	Provision for loan losses		800	1,800	1,300	600	300	4,500	800

Net interest income after provision
for loan losses			8,451	7,459	7,572	7,948	8,296	31,430	34,026

Noninterest income
	Wealth management fees		863	839	775	768	801	3,245	3,093
	Customer service fees		728	730	667	682	712	2,807	2,761
	Gain on sale of mtg. loans & OMSR		7,197	8,085	8,119	1,949	3,048	25,350	8,413
	Mortgage loan servicing fees, net		(1,037)	(169)	(1,880)	(2,052)	334	(5,138)	(397)
	Gain on sale of non-mortgage loans		123	119	107	104	250	453	1,255
	Title insurance revenue		522	517	609	265	393	1,913	1,120
	Net gain on sales of securities		-	-	-	-	-	-	206
	Gain (loss) on sale of assets		181	(52)	(80)	(46)	1	3	(5)
	Other		325	349	298	491	420	1,463	1,570

		Total noninterest income	8,902	10,418	8,615	2,161	5,959	30,096	18,016

Noninterest expense
	Salaries and employee benefits		6,556	6,995	6,419	5,427	6,142	25,397	22,064
	Net occupancy expense		782	736	675	698	675	2,891	2,603
	Equipment expense		818	888	780	700	764	3,186	2,828
	Data processing fees		633	586	1,288	548	543	3,055	1,973
	Professional fees		631	695	1,224	757	639	3,307	2,476
	Marketing expense		172	137	141	208	171	658	895
	Telephone and communication expense		156	142	122	115	121	535	466
	Postage and delivery expense		108	96	96	115	86	415	340
	State, local and other taxes		299	331	262	254	347	1,146	1,092
	Employee expense		103	155	93	184	207	535	795
	Other expenses		426	574	562	400	481	1,962	1,878

		Total noninterest expense	10,684	11,335	11,662	9,406	10,176	43,087	37,410


Income before income tax expense			6,669	6,542	4,525	703	4,079	18,439	14,632

	Income tax expense		1,311	1,292	870	22	721	3,495	2,659

Net income			$ 5,358	$ 5,250	$ 3,655	$ 681	$ 3,358	$ 14,944	$ 11,973

Preferred share dividends			-	-	-	-	230	-	950

Net income available to common shareholders			5,358	5,250	3,655	681	3,128	14,944	11,023

Common share data:
	Basic earnings per common share		$ 0.71	$ 0.69	$ 0.47	$ 0.09	$ 0.48	$ 1.96	$ 1.71

	Diluted earnings per common share		$ 0.71	$ 0.69	$ 0.47	$ 0.09	$ 0.42	$ 1.96	$ 1.51

Average shares outstanding (in thousands):
	Basic:		7,487	7,607	7,708	7,749	6,445	7,635	6,456
	Diluted:		7,487	7,607	7,708	7,756	7,799	7,635	7,935




	SB FINANCIAL GROUP, INC.
	CONSOLIDATED FINANCIAL HIGHLIGHTS - (Unaudited)

($ in thousands, except per share & ratios)		At and for the Three Months Ended					Twelve Months Ended

		December	September	June	March	December	December	December
SUMMARY OF OPERATIONS		2020	2020	2020	2020	2019	2020	2019

Net interest income		$ 9,251	$ 9,259	$ 8,872	$ 8,548	$ 8,596	$ 35,930	$ 34,826
Tax-equivalent adjustment		37	36	37	42	41	152	171
Tax-equivalent net interest income		9,288	9,295	8,909	8,590	8,637	36,082	34,997
Provision for loan loss		800	1,800	1,300	600	300	4,500	800
Noninterest income		8,902	10,418	8,615	2,161	5,959	30,096	18,016
Total operating revenue		18,153	19,677	17,487	10,709	14,555	66,026	52,842
Noninterest expense		10,684	11,335	11,662	9,406	10,176	43,087	37,410
Pre-tax pre-provision income		7,469	8,342	5,825	1,303	4,379	22,939	15,432
Pretax income		6,669	6,542	4,525	703	4,079	18,439	14,632
Net income		5,358	5,250	3,655	681	3,358	14,944	11,973
Net income available to common shareholders		5,358	5,250	3,655	681	3,128	14,944	11,023

PER SHARE INFORMATION:
Basic earnings per share (EPS)		0.71	0.69	0.47	0.09	0.48	1.96	1.71
Diluted earnings per share		0.71	0.69	0.47	0.09	0.42	1.96	1.51
Common dividends		0.105	0.100	0.100	0.095	0.095	0.400	0.360
Book value per common share		19.39	18.73	17.97	17.64	17.53	19.39	17.53
Tangible book value per common share (TBV)		16.30	15.72	15.09	15.33	15.24	16.30	15.24
Market price per common share		18.28	13.49	16.62	11.12	19.69	18.28	19.69
Market price to TBV		112.1%	85.8%	110.1%	72.5%	129.2%	112.1%	129.2%
Market price to trailing 12 month EPS		9.3	8.0	11.4	8.4	13.0	9.3	13.0

PERFORMANCE RATIOS:
Return on average assets (ROAA)		1.73%	1.73%	1.25%	0.26%	1.28%	1.29%	1.16%
Pre-tax pre-provision ROAA		2.41%	2.74%	1.99%	0.49%	1.67%	2.14%	1.50%
Return on average equity		15.05%	15.01%	10.31%	1.99%	9.93%	10.74%	8.99%
Return on average tangible equity		17.91%	17.93%	11.91%	2.29%	12.83%	12.59%	11.73%
Efficiency ratio		58.76%	57.48%	66.68%	87.81%	69.90%	65.25%	70.79%
Earning asset yield		3.66%	3.96%	3.95%	4.32%	4.80%	3.98%	4.85%
Cost of interest bearing liabilities		0.64%	0.75%	0.89%	1.12%	1.42%	0.85%	1.31%
Net interest margin		3.20%	3.39%	3.30%	3.47%	3.68%	3.35%	3.81%
Tax equivalent effect		0.01%	0.02%	0.02%	0.01%	0.02%	0.01%	0.01%
Net interest margin, tax equivalent		3.21%	3.41%	3.32%	3.48%	3.70%	3.36%	3.82%
Non interest income/Average assets		2.87%	3.42%	2.95%	0.81%	2.27%	2.59%	1.75%
Non interest expense/Average assets		3.45%	3.73%	3.99%	3.54%	3.87%	3.71%	3.64%
Net noninterest expense/Average assets		-0.58%	-0.30%	-1.04%	-2.73%	-1.60%	-1.12%	-1.89%

ASSET QUALITY RATIOS:
Gross charge-offs		57	32	254	400	51	743	259
Recoveries		39	11	10	3	14	63	47
Net charge-offs		18	21	244	397	37	680	212
Nonaccruing loans/Total loans		0.74%	0.72%	0.72%	0.70%	0.67%	0.74%	0.67%
Nonperforming loans/Total loans		0.83%	0.81%	0.81%	0.79%	0.77%	0.83%	0.77%
Nonperforming assets/Loans & OREO		0.83%	0.82%	0.86%	0.80%	0.81%	0.83%	0.81%
Nonperforming assets/Total assets		0.58%	0.60%	0.64%	0.61%	0.64%	0.58%	0.64%
Allowance for loan loss/Nonperforming loans		173.77%	163.84%	136.45%	135.77%	137.35%	173.77%	137.35%
Allowance for loan loss/Total loans		1.44%	1.33%	1.11%	1.08%	1.06%	1.44%	1.06%
Net loan charge-offs/Average loans (ann.)		0.01%	0.01%	0.11%	0.19%	0.02%	0.08%	0.03%
Loan loss provision/Net charge-offs		4444.44%	8571.43%	532.79%	151.13%	810.81%	661.76%	377.36%

CAPITAL & LIQUIDITY RATIOS:
Loans/ Deposits		83.19%	87.36%	91.01%	96.17%	98.25%	83.19%	98.25%
Equity/ Assets		11.36%	11.60%	11.46%	12.49%	13.10%	11.36%	13.10%
Tangible equity/Tangible assets		9.73%	9.97%	9.80%	11.03%	11.59%	9.73%	11.59%
Common equity tier 1 ratio (Bank)		12.91%	12.71%	11.97%	12.17%	12.46%	12.91%	12.46%

END OF PERIOD BALANCES
Total assets		1,257,839	1,218,241	1,202,936	1,088,313	1,038,577	1,257,839	1,038,577
Total loans		872,723	885,850	901,548	830,764	825,510	872,723	825,510
Deposits		1,049,011	1,014,015	990,587	863,891	840,219	1,049,011	840,219
Stockholders equity		142,923	141,347	137,881	135,905	136,094	142,923	136,094
Goodwill and intangibles		22,745	22,091	22,117	17,792	17,792	22,745	17,792
Tangible equity		120,178	119,256	115,764	118,113	118,302	120,178	118,302
Mortgage servicing portfolio		1,299,698	1,293,037	1,261,746	1,216,292	1,199,107	1,299,698	1,199,107
Wealth/Brokerage assets under care		558,409	522,360	495,025	427,129	507,670	558,409	507,670
Total assets under care		3,115,946	3,033,638	2,959,707	2,731,734	2,745,354	3,115,946	2,745,354
Full-time equivalent employees		244	251	254	253	252	244	252
Period end common shares outstanding		7,372	7,545	7,672	7,705	7,763	7,372	7,763
Market capitalization (all)		134,760	101,782	127,509	85,680	152,853	134,760	152,853

AVERAGE BALANCES
Total assets		1,238,790	1,216,843	1,169,030	1,061,365	1,051,071	1,161,396	1,027,932
Total earning assets		1,156,718	1,090,386	1,073,490	986,216	934,540	1,072,443	914,975
Total loans		893,244	907,483	898,216	832,975	828,108	880,338	809,651
Deposits		1,031,649	1,007,679	946,053	855,272	856,961	951,226	836,299
Stockholders equity		142,418	139,908	141,821	136,930	135,267	139,197	133,190
Goodwill and intangibles		22,754	22,787	19,066	17,831	17,833	20,491	17,597
Preferred equity		-	-	-	-	12,707	-	13,484
Tangible equity		119,664	117,121	122,755	119,099	104,727	118,706	102,109
Average basic shares outstanding		7,487	7,607	7,708	7,749	6,445	7,635	6,456
Average diluted shares outstanding		7,487	7,607	7,708	7,756	7,799	7,635	7,935




SB FINANCIAL GROUP, INC.
	Rate Volume Analysis - (Unaudited)
	At and for the Three Months Ended December 31, 2020 and 2019

	($ in thousands)	Three Months Ended Dec. 31, 2020			Three Months Ended Dec. 31, 2019
		Average		Average	Average		Average
Assets		Balance	Interest	Rate	Balance	Interest	Rate

	Taxable securities/Cash	$ 256,068	$ 632	0.99%	$ 99,149	$ 737	2.97%
	Nontaxable securities	7,406	87	4.70%	7,283	72	3.95%
	Loans, net	893,244	9,870	4.42%	828,108	10,396	5.02%

	Total earning assets	1,156,718	10,589	3.66%	934,540	11,205	4.80%

	Cash and due from banks	7,463			48,289
	Allowance for loan losses	(12,045)			(8,566)
	Premises and equipment	23,841			24,183
	Other assets	62,813			52,625

	Total assets	$ 1,238,790			$ 1,051,071

Liabilities
	Savings, MMDA and interest bearing demand	$ 552,018	$ 841	0.61%	$ 432,077	$ 614	0.57%
	Time deposits	238,284	377	0.63%	264,054	1,778	2.69%
	Repurchase agreements & other	21,610	10	0.19%	13,891	17	0.49%
	Advances from Federal Home Loan Bank	8,000	58	2.90%	16,000	101	2.53%
	Trust preferred securities	10,310	52	2.02%	10,310	99	3.84%

	Total interest bearing liabilities	830,222	1,338	0.64%	736,332	2,609	1.42%

	Non interest bearing demand	241,347	-		160,830	-

	Total funding	1,071,569		0.50%	897,162		1.16%

	Other liabilities	24,803			18,642

	Total liabilities	1,096,372			915,804

	Equity	142,418			135,267

	Total liabilities and equity	$ 1,238,790			$ 1,051,071

	Net interest income		$ 9,251			$ 8,596

	Net interest income as a percent of average interest-earning assets - GAAP measure			3.20%			3.68%

	Net interest income as a percent of average interest-earning assets - non GAAP			3.21%			3.70%
	- Computed on a fully tax equivalent (FTE) basis

		Twelve Months Ended Dec. 31, 2020			Twelve Months Ended Dec. 31, 2019
		Average		Average	Average		Average
Assets		Balance	Interest	Rate	Balance	Interest	Rate

	Taxable securities/Cash	$ 185,480	$ 2,328	1.26%	$ 95,216	$ 3,226	3.39%
	Nontaxable securities	6,625	333	5.03%	10,108	345	3.41%
	Loans, net	880,338	39,974	4.54%	809,651	40,829	5.04%

	Total earning assets	1,072,443	42,635	3.98%	914,975	44,400	4.85%

	Cash and due from banks	14,553			47,135
	Allowance for loan losses	(10,165)			(8,370)
	Premises and equipment	23,776			23,779
	Other assets	60,789			50,413

	Total assets	$ 1,161,396			$ 1,027,932

Liabilities
	Savings, MMDA and interest bearing demand	$ 492,267	$ 3,152	0.64%	$ 427,858	$ 2,846	0.67%
	Time deposits	247,955	2,918	1.18%	262,040	5,814	2.22%
	Repurchase agreements & Other	22,832	70	0.31%	15,288	82	0.54%
	Advances from Federal Home Loan Bank	14,186	309	2.18%	16,066	402	2.50%
	Trust preferred securities	10,310	256	2.48%	10,310	430	4.17%

	Total interest bearing liabilities	787,550	6,705	0.85%	731,562	9,574	1.31%

	Non interest bearing demand	211,004		0.67%	146,401		1.09%

	Total funding	998,554			877,963

	Other liabilities	23,645			16,779

	Total liabilities	1,022,199			894,742

	Equity	139,197			133,190

	Total liabilities and equity	$ 1,161,396			$ 1,027,932

	Net interest income		$ 35,930			$ 34,826

	Net interest income as a percent of average interest-earning assets - GAAP measure			3.35%			3.81%

	Net interest income as a percent of average interest-earning assets - non GAAP			3.36%			3.82%
	- Computed on a fully tax equivalent (FTE) basis

Non-GAAP reconciliation	Three Months Ended		Twelve Months Ended

($ in thousands, except per share & ratios)	Dec. 31, 2020	Dec. 31, 2019	Dec. 31, 2020	Dec. 31, 2019

Total Operating Revenue	$ 18,153	$ 14,555	$ 66,026	$ 52,842
Adjustment to (deduct)/add OMSR impairment*	611	(303)	3,585	1,094

Adjusted Total Operating Revenue	18,764	14,252	69,611	53,936

Total Operating Expense	$ 10,684	$ 9,500	$ 43,087	$ 37,410
Adjustment for merger expenses**	-	-	(1,241)	-

Adjusted Total Operating Expense	10,684	9,500	41,846	37,410

Income before Income Taxes	6,669	4,079	18,439	14,632
Adjustment for OMSR & merger expense	611	(303)	4,826	1,094

Adjusted Income before Income Taxes	7,280	3,776	23,265	15,726


Provision for Income Taxes	1,311	721	3,495	2,659
Adjustment for OMSR & merger expense***	128	(64)	1,013	230

Adjusted Provision for Income Taxes	1,439	657	4,508	2,890


Net Income	5,358	3,358	14,944	11,973
Adjustment for OMSR & merger expense	483	(239)	3,813	864

Adjusted Net Income	5,841	3,119	18,757	12,838


Diluted Earnings per Share	0.71	0.42	1.96	1.51
Adjustment for OMSR & merger expense	0.06	(0.03)	0.48	0.11

Adjusted Diluted Earnings per Share	$ 0.77	$ 0.39	$ 2.44	$ 1.62


Return on Average Assets	1.73%	1.28%	1.29%	1.16%
Adjustment for OMSR & merger expense	0.16%	-0.02%	0.33%	0.08%

Adjusted Return on Average Assets	1.89%	1.26%	1.61%	1.24%

*valuation adjustment to the Company's mortgage servicing rights

**transactions costs related to the Edon acquisition

***tax effect is calculated using a 21% statutory federal corporate income tax rate