SmartFinancial (SMBK) investor relations material

Executive summary

• Net income for Q2 2025 was $11.7M ($0.69 per diluted share), up 46% year-over-year and 4% sequentially, with five consecutive quarters of positive operating leverage.

• Total assets reached $5.5B, with annualized organic loan growth of 13% and deposit growth of 5%, both ahead of expectations.

• Tangible book value per share grew to $24.42 (including AOCI), up 13% annualized quarter over quarter.

• Asset quality remained strong, with nonperforming assets at 0.19% of total assets and net charge-offs at 0.01% annualized.

• Focus remains on deepening presence in existing Southeast markets and recruiting top talent, with new hires and high employee satisfaction.

Financial highlights

• Net interest income rose to $40.3M, up 6% sequentially and 23% year-over-year; net interest margin increased to 3.29%.

• Noninterest income increased to $8.9M, up 4% sequentially and 17% year-over-year, driven by insurance, mortgage banking, and capital markets.

• Noninterest expenses were $32.6M, at the low end of guidance, mainly from merit and incentive compensation.

• Provision for credit losses was $2.4M, reflecting higher loan growth.

• Operating efficiency ratio improved to 65.7% from 68.5% in 1Q25 and 72.1% in 2Q24.

Outlook and guidance

• Management expects continued organic loan and deposit growth, with margin expansion of 2–3 bps per quarter in H2 2025 and Q3 margin forecasted at 3.3%–3.35%.

• Noninterest income projected at ~$9M and noninterest expense at $33.8M–$34M for Q3; salary expenses to rise due to new hires.

• Revenue growth is expected to outpace expense growth, with continued focus on positive operating leverage into 2026.

• ROA target of 1% remains in sight, with expectations to reach mid-90s bps in the next quarter.

• Interest rate risk and liquidity are actively managed, with risk metrics within policy limits.