Bridgewater Bancshares, Inc. Announces Fourth Quarter 2024 Financial Results

Share Name	Share Symbol	Market	Type
Bridgewater Bancshares Inc	NASDAQ:BWB	NASDAQ	Common Stock

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Bridgewater Bancshares (NASDAQ:BWB)
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Fourth Quarter 2024 Highlights

Net income of $8.2 million, or $0.26 per diluted common share; adjusted net income of $8.6 million, or $0.27 per diluted common share.(1)
Completed the acquisition of First Minnetonka City Bank (FMCB) in just 107 days following announcement.
Net interest income increased $1.4 million, or 5.3%, from the third quarter of 2024.
Net interest margin (on a fully tax-equivalent basis) of 2.32% for the fourth quarter of 2024, an increase of eight basis points from the third quarter of 2024.
Core deposits(2) increased by $428.2 million, or 63.6% annualized, from the third quarter of 2024; core deposits excluding FMCB increased by $210.9 million, or 31.3% annualized.
Gross loans increased by $182.9 million, or 19.7% annualized, from the third quarter of 2024; gross loans excluding FMCB increased by $65.8 million, or 7.1% annualized.
Annualized net loan charge-offs as a percentage of average loans of 0.03%, compared to 0.10% for the third quarter of 2024.

Full Year 2024 Highlights

Net income of $32.8 million, or $1.03 per diluted common share; adjusted net income of $33.4 million, or $1.05 per diluted common share.(1)
Total deposits increased by $376.8 million, or 10.2%, in 2024; core deposits(2) increased by $559.4 million, or 22.0%.
Gross loans increased by $144.2 million, or 3.9%, in 2024.
Loan-to-deposit ratio of 94.7%, down from 100.4% at December 31, 2023.
Net loan charge-offs as a percentage of average loans were 0.03% for the year ended December 31, 2024, compared to 0.01% for the year ended December 31, 2023.
Nonperforming assets to total assets of 0.01% for the year ended December 31, 2024, compared to 0.02% at December 31, 2023.
Tangible book value per share(1) of $13.49 at December 31, 2024, an increase of 5.1%, from December 31, 2023.

(1) Represents a non-GAAP financial measure. See "Non-GAAP Financial Measures" for further details. (2) Core deposits are defined as total deposits less brokered deposits and certificates of deposit greater than $250,000.

Bridgewater Bancshares, Inc. (Nasdaq: BWB) (the Company), the parent company of Bridgewater Bank (the Bank), today announced net income of $8.2 million for the fourth quarter of 2024, compared to $8.7 million for the third quarter of 2024, and $8.9 million for the fourth quarter of 2023. Earnings per diluted common share were $0.26 for the fourth quarter of 2024, compared to $0.27 for the third quarter of 2024, and $0.28 for the fourth quarter of 2023. Adjusted net income was $8.6 million for the fourth quarter of 2024, compared to $8.8 million for the third quarter of 2024, and $8.9 million for the fourth quarter of 2023. Adjusted earnings per diluted common share were $0.27 for the fourth quarter of 2024, compared to $0.28 for the third quarter of 2024, and $0.28 for the fourth quarter of 2023.

“Bridgewater finished the year with positive momentum as the fourth quarter saw robust balance sheet growth, net interest margin expansion, superb asset quality, and the closing of our acquisition of First Minnetonka City Bank,” said Chairman and Chief Executive Officer, Jerry Baack. “Core deposit growth was very strong and loan balances rebounded nicely as loan demand increased later in the year. We were also pleased to see margin expansion during the quarter as our balance sheet was well-positioned for recent Fed rate cuts.

“In December, we welcomed new team members and clients as our acquisition of First Minnetonka City Bank was completed just 107 days after it was announced last August. We believe this acquisition, coupled with the strong core deposit growth and increased liquidity generated in 2024, will allow us to be more offensive-minded and return to more normalized levels of profitable growth in 2025.”

Key Financial Measures

As of and for the Three Months Ended

As of and for the Year Ended

December 31,

September 30,

December 31,

2024

2023

2024

2023

Per Common Share Data

Basic Earnings Per Share

0.26

0.28

1.05

1.29

Diluted Earnings Per Share

0.26

0.27

0.28

1.03

1.27

Adjusted Diluted Earnings Per Share (1)

0.27

0.28

1.05

1.27

Book Value Per Share

14.21

14.06

12.94

14.21

12.94

Tangible Book Value Per Share (1)

13.49

13.96

12.84

13.49

12.84

Financial Ratios

Return on Average Assets (2)

0.68

0.73

0.77

0.70

0.89

Pre-Provision Net Revenue Return on Average Assets (1)(2)

1.05

0.96

0.98

1.15

Return on Average Shareholders' Equity (2)

7.16

7.79

8.43

7.45

9.73

Return on Average Tangible Common Equity (1)(2)

7.43

8.16

8.95

7.75

10.53

Net Interest Margin (3)

2.32

2.24

2.27

2.26

2.42

Core Net Interest Margin (1)(3)

2.25

2.16

2.21

2.19

2.34

Cost of Total Deposits

3.40

3.58

3.19

3.44

2.73

Cost of Funds

3.38

3.54

3.23

3.44

2.92

Efficiency Ratio (1)

56.8

58.0

58.8

57.9

53.0

Noninterest Expense to Average Assets (2)

1.40

1.33

1.37

1.35

1.32

Tangible Common Equity to Tangible Assets (1)

7.36

8.17

7.73

7.36

7.73

Common Equity Tier 1 Risk-based Capital Ratio (Consolidated) (4)

9.08

9.79

9.16

9.08

9.16

Adjusted Financial Ratios (1)

Adjusted Return on Average Assets (2)

0.71

0.75

0.77

0.71

0.89

Adjusted Pre-Provision Net Revenue Return on Average Assets (2)

1.09

0.98

0.96

0.99

1.15

Adjusted Return on Average Shareholders' Equity (2)

7.49

7.94

8.43

7.57

9.73

Adjusted Return on Average Tangible Common Equity (2)

7.82

8.34

8.95

7.90

10.53

Adjusted Efficiency Ratio

55.2

57.2

58.8

57.3

53.0

Adjusted Noninterest Expense to Average Assets (2)

1.36

1.31

1.37

1.34

1.32

Balance Sheet and Asset Quality (dollars in thousands)

Total Assets

5,066,242

4,691,517

4,611,990

5,066,242

4,611,990

Total Loans, Gross

3,868,514

3,685,590

3,724,282

3,868,514

3,724,282

Deposits

4,086,767

3,747,442

3,709,948

4,086,767

3,709,948

Loan to Deposit Ratio

94.7

98.3

100.4

94.7

100.4

Net Loan Charge-Offs to Average Loans (2)

0.03

0.10

0.01

0.03

0.01

Nonperforming Assets to Total Assets (5)

0.01

0.19

0.02

0.01

0.02

Allowance for Credit Losses to Total Loans

1.35

1.38

1.36

1.35

1.36

_______________________ (1)

Represents a non-GAAP financial measure. See "Non-GAAP Financial Measures" for further details.

(2)

Annualized.

(3)

Amounts calculated on a tax-equivalent basis using the statutory federal tax rate of 21%.

(4)

Preliminary data. Current period subject to change prior to filings with applicable regulatory agencies.

(5)

Nonperforming assets are defined as nonaccrual loans plus 90 days past due and still accruing plus foreclosed assets.

Income Statement

Net Interest Margin and Net Interest Income

Net interest margin (on a fully tax-equivalent basis) for the fourth quarter of 2024 was 2.32%, an eight basis point increase from 2.24% in the third quarter of 2024, and a five basis point increase from 2.27% in the fourth quarter of 2023. Core net interest margin (on a fully tax-equivalent basis), a non-GAAP financial measure which excludes the impact of loan fees, was 2.25% for the fourth quarter of 2024, a nine basis point increase from 2.16% in the third quarter of 2024, and a four basis point increase from 2.21% in the fourth quarter of 2023.

Net interest margin expanded to 2.32% in the fourth quarter of 2024 primarily due to lower costs of deposits and increased balances in the securities and loan portfolios.
Excluding the stub period impact of the acquisition of FMCB during the quarter, total net interest margin (on a tax-equivalent basis) for the fourth quarter of 2024 was 2.30%.
The year-over-year expansion in margin was primarily due to increased balances in the securities and loan portfolios at higher yields, offset partially by higher deposit costs.

Net interest income was $27.0 million for the fourth quarter of 2024, an increase of $1.4 million from $25.6 million in the third quarter of 2024, and an increase of $1.7 million from $25.3 million in the fourth quarter of 2023.

The linked-quarter increase in net interest income was primarily due to decreased rates paid on deposits.
The year-over year increase in net interest income was primarily due to growth and higher yields in the securities portfolio and higher yields on loans, offset partially by growth and higher rates on deposits.

Interest income was $63.3 million for the fourth quarter of 2024, an increase of $297,000 from $63.0 million in the third quarter of 2024, and an increase of $4.8 million from $58.6 million in the fourth quarter of 2023.

The yield on interest earning assets (on a fully tax-equivalent basis) was 5.40% in the fourth quarter of 2024, compared to 5.48% in the third quarter of 2024, and 5.22% in the fourth quarter of 2023.
The linked-quarter decrease in the yield on interest earning assets was primarily due to higher cash and securities balances at lower yields and lower loan fees collected during the quarter.
The year-over-year increase in the yield on interest earning assets was primarily due to repricing of the securities and loan portfolios in the higher interest rate environment.
The aggregate loan yield decreased to 5.55% in the fourth quarter of 2024, two basis points lower than 5.57% in the third quarter of 2024, and 22 basis points higher than 5.33% in the fourth quarter of 2023.
Core loan yield remained stable at 5.47% in the fourth quarter of 2024.

A summary of interest and fees recognized on loans for the periods indicated is as follows:

Three Months Ended

December 31, 2024

September 30, 2024

June 30, 2024

March 31, 2024

December 31, 2024

Interest

5.47

5.42

5.31

5.25

Fees

0.08

0.10

0.08

0.07

0.08

Yield on Loans

5.55

5.57

5.50

5.38

5.33

Interest expense was $36.4 million for the fourth quarter of 2024, a decrease of $1.1 million from $37.4 million in the third quarter of 2024, and an increase of $3.1 million from $33.2 million in the fourth quarter of 2023.

The cost of interest bearing liabilities was 4.06% in the fourth quarter of 2024, compared to 4.27% in the third quarter of 2024, and 3.97% in the fourth quarter of 2023.
The linked-quarter decrease in the cost of interest bearing liabilities was primarily due to lower rates paid on deposits and a decrease in brokered deposit balances.
The year-over-year increase in the cost of interest bearing liabilities was primarily due to the upward repricing of the deposit portfolio in the higher rate environment, offset partially by a decrease in brokered deposit balances.

Interest expense on deposits was $32.8 million for the fourth quarter of 2024, a decrease of $1.4 million from $34.2 million in the third quarter of 2024, and an increase of $3.4 million from $29.4 million in the fourth quarter of 2023.

The cost of total deposits was 3.40% in the fourth quarter of 2024, compared to 3.58% in the third quarter of 2024, and 3.19% in the fourth quarter of 2023.
The linked-quarter decrease in the cost of total deposits was primarily due to interest rate cuts by the Federal Reserve and the reduction of higher cost funding; brokered deposits decreased during the quarter by $75.2 million, or 8.3%.
The year-over-year increase in the cost of total deposits was primarily due to the upward repricing of the deposit portfolio in the higher interest rate environment.

Provision for Credit Losses

The provision for credit losses on loans was $1.5 million for the fourth quarter of 2024, which included a $950,000 provision for non-purchase credit deteriorated (PCD) loans acquired in the FMCB transaction. The provision for credit losses on loans was $-0- for both the third quarter of 2024 and the fourth quarter of 2023.

The provision for credit losses on loans recorded in the fourth quarter of 2024 was primarily attributable to the acquisition of FMCB and growth in the loan portfolio.
The allowance for credit losses on loans to total loans was 1.35% at December 31, 2024, compared to 1.38% at September 30, 2024, and 1.36% at December 31, 2023.

The provision for credit losses for off-balance sheet credit exposures was $725,000 for the fourth quarter of 2024, compared to $-0- for the third quarter of 2024, and a negative provision of $250,000 for the fourth quarter of 2023.

A provision was recorded during the fourth quarter of 2024 due to an increase in the volume of newly originated loans with unfunded commitments in the commercial and construction and land development segments.

Noninterest Income

Noninterest income was $2.5 million for the fourth quarter of 2024, an increase of $1.0 million from $1.5 million for the third quarter of 2024, and an increase of $1.1 million from $1.4 million for the fourth quarter of 2023.

The linked-quarter increase was primarily due to higher letter of credit fees and swap fees. There was no material stub period impact from the completion of the FMCB transaction in the fourth quarter of 2024.
The year-over-year increase was primarily due to higher letter of credit fees and swap fees.

Noninterest Expense

Noninterest expense was $16.8 million for the fourth quarter of 2024, an increase of $1.1 million from $15.8 million for the third quarter of 2024 and an increase of $1.1 million from $15.7 million for the fourth quarter of 2023.

The linked-quarter increase was primarily due to increases in salaries and employee benefits and merger-related expenses.
Noninterest expense for the fourth quarter of 2024 included $488,000 of merger-related expenses, compared to $224,000 for the third quarter of 2024.
The stub period impact from the completion of the FMCB transaction to noninterest expense, excluding merger-related expenses, was $199,000 for the fourth quarter of 2024.
The year-over-year increase was primarily attributable to increases in salaries and employee benefits and merger-related expenses, offset partially by a decrease in the FDIC insurance assessment, which resulted from decreased brokered deposits and moderated loan growth.
The efficiency ratio, a non-GAAP financial measure, was 56.8% for the fourth quarter of 2024, compared to 58.0% for the third quarter of 2024, and 58.8% for the fourth quarter of 2023.
The Company had 290 full-time equivalent employees at December 31, 2024, compared to 265 at September 30, 2024, and 255 at December 31, 2023. The increase during the quarter was largely driven by the addition of 25 new employees from the acquisition of FMCB.

Income Taxes

The effective combined federal and state income tax rate was 22.0% for the fourth quarter of 2024, compared to 23.6% for the third quarter of 2024, and 21.0% for the fourth quarter of 2023.

Balance Sheet

Loans

(dollars in thousands)

December 31, 2024

September 30, 2024

June 30, 2024

March 31, 2024

December 31, 2023

Commercial

497,662

493,403

518,762

483,069

464,061

Leases

44,291

—

Construction and Land Development

97,255

118,596

134,096

200,970

232,804

1 - 4 Family Construction

41,961

45,822

60,551

65,606

65,087

Real Estate Mortgage:

1 - 4 Family Mortgage

474,383

421,179

416,944

417,773

402,396

Multifamily

1,425,610

1,379,814

1,404,835

1,389,345

1,388,541

CRE Owner Occupied

191,248

182,239

185,988

182,589

175,783

CRE Nonowner Occupied

1,083,108

1,032,142

1,070,050

1,035,702

987,306

Total Real Estate Mortgage Loans

3,174,349

3,015,374

3,077,817

3,025,409

2,954,026

Consumer and Other

12,996

12,395

9,159

9,151

8,304

Total Loans, Gross

3,868,514

3,685,590

3,800,385

3,784,205

3,724,282

Allowance for Credit Losses on Loans

(52,277

)

(51,018

)

(51,949

)

(51,347

)

(50,494

)

Net Deferred Loan Fees

(6,801

)

(5,705

)

(6,214

)

(6,356

)

(6,573

)

Total Loans, Net

3,809,436

3,628,867

3,742,222

3,726,502

3,667,215

Total gross loans at December 31, 2024 were $3.87 billion, an increase of $182.9 million, or 5.0%, over total gross loans of $3.69 billion at September 30, 2024, and an increase of $144.2 million, or 3.9%, over total gross loans of $3.72 billion at December 31, 2023.

Total gross loan balances included $117.1 million of loans at amortized cost acquired in the FMCB transaction.
Excluding loans acquired in the FMCB transaction, total gross loans were up 7.1% annualized from the third quarter of 2024. The increase in the loan portfolio during the fourth quarter of 2024 was due to increased loan originations, partially offset by loan payoffs.

Deposits

(dollars in thousands)

December 31, 2024

September 30, 2024

June 30, 2024

March 31, 2024

December 31, 2023

Noninterest Bearing Transaction Deposits

800,763

713,309

705,175

698,432

756,964

Interest Bearing Transaction Deposits

862,242

805,756

752,568

783,736

692,801

Savings and Money Market Deposits

1,259,503

980,345

943,994

979,773

935,091

Time Deposits

338,506

347,080

373,713

352,510

300,651

Brokered Deposits

825,753

900,952

1,032,262

992,774

1,024,441

Total Deposits

4,086,767

3,747,442

3,807,712

3,807,225

3,709,948

Total deposits at December 31, 2024 were $4.09 billion, an increase of $339.3 million, or 9.1%, over total deposits of $3.75 billion at September 30, 2024, and an increase of $376.8 million, or 10.2%, over total deposits of $3.71 billion at December 31, 2023.

Total deposit balances included $225.7 million of deposits acquired in the FMCB transaction as of December 31, 2024.
Core deposits, defined as total deposits excluding brokered deposits and time deposits greater than $250,000, increased $428.2 million, or 63.6% annualized, from the third quarter of 2024; core deposits, excluding deposits assumed in the FMCB transaction, increased by $210.9 million, or 31.3% annualized. Growth in core deposits was due to both increased balances of existing clients and new client acquisitions. On a year-to-date basis, core deposits increased by $559.4 million, or 22.0%. Based on the nature of the Company’s client base, core deposit balances can fluctuate from quarter to quarter, as deposit growth is not always linear.
Brokered deposits declined by $75.2 million, or 8.3%, in the fourth quarter of 2024 and declined by $198.7 million, or 19.4%, from December 31, 2023. While balances are down, we continue to use as a supplemental funding source, as needed.
Uninsured deposits were 27.7% of total deposits as of December 31, 2024, compared to 25.0% of total deposits as of September 30, 2024.

Liquidity

Total on- and off-balance sheet liquidity was $2.30 billion as of December 31, 2024, compared to $2.29 billion at September 30, 2024, and $2.23 billion at December 31, 2023.

Primary Liquidity—On-Balance Sheet

December 31, 2024

September 30, 2024

June 30, 2024

March 31, 2024

December 31, 2023

(dollars in thousands)

Cash and Cash Equivalents

188,884

167,869

97,237

105,784

96,594

Securities Available for Sale

768,247

664,715

601,057

633,282

604,104

Less: Pledged Securities

(289,903

)

(146,144

)

(169,095

)

(169,479

)

(170,727

)

Total Primary Liquidity

667,228

686,440

529,199

569,587

529,971

Ratio of Primary Liquidity to Total Deposits

16.3

18.3

13.9

15.0

14.3

Secondary Liquidity—Off-Balance Sheet Borrowing Capacity

Net Secured Borrowing Capacity with the FHLB

483,245

509,223

451,171

446,801

498,736

Net Secured Borrowing Capacity with the Federal Reserve Bank

925,798

867,955

1,015,873

1,006,010

979,448

Unsecured Borrowing Capacity with Correspondent Lenders

200,000

Secured Borrowing Capacity with Correspondent Lender

19,855

26,250

Total Secondary Liquidity

1,628,898

1,603,428

1,693,294

1,679,061

1,704,434

Total Primary and Secondary Liquidity

2,296,126

2,289,868

2,222,493

2,248,648

2,234,405

Ratio of Primary and Secondary Liquidity to Total Deposits

56.2

61.1

58.4

59.1

60.2

Asset Quality

Overall asset quality remained superb due to the Company’s measured risk selection, consistent underwriting standards, active credit oversight, and experienced lending and credit teams.

Annualized net charge-offs as a percentage of average loans were 0.03% for the fourth quarter of 2024, compared to 0.10% for the third quarter of 2024, and 0.01% for the fourth quarter of 2023.
At December 31, 2024, the Company’s nonperforming assets, which include nonaccrual loans, loans past due 90 days and still accruing, and foreclosed assets, were $301,000, or 0.01% of total assets, compared to $8.8 million, or 0.19% of total assets, at September 30, 2024, and $919,000, or 0.02% of total assets, at December 31, 2023.
Loans with potential weaknesses that warranted a special mention/watchlist risk rating at December 31, 2024 totaled $46.6 million, compared to $32.0 million at September 30, 2024, and $26.5 million at December 31, 2023.
Loans that warranted a substandard risk rating at December 31, 2024 totaled $21.8 million, compared to $31.6 million at September 30, 2024, and $35.9 million at December 31, 2023.

Capital

Total shareholders’ equity at December 31, 2024 was $457.9 million, an increase of $5.7 million, or 1.3%, compared to total shareholders’ equity of $452.2 million at September 30, 2024, and an increase of $32.4 million, or 7.6%, over total shareholders’ equity of $425.5 million at December 31, 2023.

The linked-quarter increase was primarily due to net income retained and an increase in unrealized gains in the derivatives portfolio, offset partially by an increase in unrealized losses in the securities portfolio and preferred stock dividends.
The year-over-year increase was due to net income retained, a decrease in unrealized losses in the securities portfolio, and an increase in unrealized gains in the derivatives portfolio, offset partially by preferred stock dividends and stock repurchases.
The Common Equity Tier 1 Risk-Based Capital Ratio was 9.08% at December 31, 2024, compared to 9.79% at September 30, 2024, and 9.16% at December 31, 2023.
Tangible common equity as a percentage of tangible assets, a non-GAAP financial measure, was 7.36% at December 31, 2024, compared to 8.17% at September 30, 2024, and 7.73% at December 31, 2023.

Tangible book value per share, a non-GAAP financial measure, was $13.49 as of December 31, 2024, a decrease of 3.4% from $13.96 as of September 30, 2024, and an increase of 5.1% from $12.84 as of December 31, 2023.

The Company did not repurchase any shares of its common stock during the fourth quarter of 2024.

The Company had $15.3 million remaining under its current share repurchase authorization at December 31, 2024.

Today, the Company also announced that its Board of Directors has declared a quarterly cash dividend on its 5.875% Non-Cumulative Perpetual Preferred Stock, Series A (Series A Preferred Stock). The quarterly cash dividend of $36.72 per share, equivalent to $0.3672 per depositary share, each representing a 1/100th interest in a share of the Series A Preferred Stock (Nasdaq: BWBBP), is payable on March 3, 2025 to shareholders of record of the Series A Preferred Stock at the close of business on February 14, 2025.

Conference Call and Webcast

The Company will host a conference call to discuss its fourth quarter 2024 financial results on Thursday, January 30, 2025 at 8:00 a.m. Central Time. The conference call can be accessed by dialing 844-481-2913 and requesting to join the Bridgewater Bancshares earnings call. To listen to a replay of the conference call via phone, please dial 877-344-7529 and enter access code 8644808. The replay will be available through February 6, 2025. The conference call will also be available via a live webcast on the Investor Relations section of the Company’s website, investors.bridgewaterbankmn.com, and archived for replay.

About the Company

Bridgewater Bancshares, Inc. (Nasdaq: BWB) is a St. Louis Park, Minnesota-based financial holding company founded in 2005. Its banking subsidiary, Bridgewater Bank, is a premier, full-service bank dedicated to providing responsive support and simple solutions to businesses, entrepreneurs, and successful individuals across the Twin Cities. Bridgewater offers a comprehensive suite of products and services spanning deposits, lending, and treasury management solutions. Bridgewater has also received numerous awards for its banking services and esteemed corporate culture. With total assets of $5.1 billion and nine strategically located branches as of December 31, 2024, Bridgewater is one of the largest locally-led banks in Minnesota and is committed to being the finest entrepreneurial bank. For more information, please visit www.bridgewaterbankmn.com.

Use of Non-GAAP financial measures

In addition to the results presented in accordance with U.S. Generally Accepted Accounting Principles (GAAP), the Company routinely supplements its evaluation with an analysis of certain non-GAAP financial measures. The Company believes these non-GAAP financial measures, in addition to the related GAAP measures, provide meaningful information to investors to help them understand the Company’s operating performance and trends, and to facilitate comparisons with the performance of peers. These disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies. Reconciliations of non-GAAP disclosures used in this earnings release to the comparable GAAP measures are provided in the accompanying tables.

Forward-Looking Statements

This earnings release contains “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements include, without limitation, statements concerning plans, estimates, calculations, forecasts and projections with respect to the anticipated future performance of the Company. These statements are often, but not always, identified by words such as “may”, “might”, “should”, “could”, “predict”, “potential”, “believe”, “expect”, “continue”, “will”, “anticipate”, “seek”, “estimate”, “intend”, “plan”, “projection”, “would”, “annualized”, “target” and “outlook”, or the negative version of those words or other comparable words of a future or forward-looking nature.

Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on our current beliefs, expectations and assumptions regarding our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Our actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not rely on any of these forward-looking statements. Important factors that could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements include, among others, the following: interest rate risk, including the effects of changes in interest rates; effects on the U.S. economy resulting from the implementation of policies proposed by the new presidential administration, including tariffs, mass deportations and tax regulations; fluctuations in the values of the securities held in our securities portfolio, including as the result of changes in interest rates; business and economic conditions generally and in the financial services industry, nationally and within our market area, including the level and impact of inflation and possible recession; the effects of developments and events in the financial services industry, including the large-scale deposit withdrawals over a short period of time that resulted in several bank failures; credit risk and risks from concentrations (by type of borrower, geographic area, collateral and industry) within the Company’s loan portfolio or large loans to certain borrowers (including CRE loans); the overall health of the local and national real estate market; our ability to successfully manage credit risk; our ability to maintain an adequate level of allowance for credit losses on loans; new or revised accounting standards as may be adopted by state and federal regulatory agencies, the FASB, SEC or PCAOB; the concentration of large deposits from certain clients, including those who have balances above current FDIC insurance limits; our ability to successfully manage liquidity risk, which may increase our dependence on non-core funding sources such as brokered deposits, and negatively impact our cost of funds; our ability to raise additional capital to implement our business plan; our ability to implement our growth strategy and manage costs effectively; the composition of our senior leadership team and our ability to attract and retain key personnel; talent and labor shortages and employee turnover; the occurrence of fraudulent activity, breaches or failures of our or our third-party vendors’ information security controls or cybersecurity-related incidents, including as a result of sophisticated attacks using artificial intelligence and similar tools or as a result of insider fraud; interruptions involving our information technology and telecommunications systems or third-party servicers; competition in the financial services industry, including from nonbank competitors such as credit unions, “fintech” companies and digital asset service providers; the effectiveness of our risk management framework; the commencement, cost and outcome of litigation and other legal proceedings and regulatory actions against us; the impact of recent and future legislative and regulatory changes, including in response to prior bank failures; risks related to climate change and the negative impact it may have on our customers and their businesses; the imposition of tariffs or other governmental policies impacting the value of products produced by our commercial borrowers; severe weather, natural disasters, wide spread disease or pandemics, acts of war or terrorism or other adverse external events, including ongoing conflicts in the Middle East and the Russian invasion of Ukraine; potential impairment to the goodwill the Company recorded in connection with acquisitions; risks associated with our acquisition of First Minnetonka City Bank, including the possibility that the merger may be more difficult or expensive to integrate than anticipated, and the effect of the merger on the Company’s customer and employee relationships and operating results; changes to U.S. or state tax laws, regulations and governmental policies concerning the Company’s general business, including changes in interpretation or prioritization and changes in response to prior bank failures; and any other risks described in the “Risk Factors” sections of reports filed by the Company with the Securities and Exchange Commission.

Any forward-looking statement made by us in this press release is based only on information currently available to us and speaks only as of the date on which it is made. The Company undertakes no obligation to publicly update any forward-looking statement, whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise.

Bridgewater Bancshares, Inc. and Subsidiaries

Financial Highlights

(dollars in thousands, except share data)

As of and for the Three Months Ended

December 31,

September 30,

June 30,

March 31,

December 31,

(dollars in thousands)

2024

2023

(Unaudited)

Income Statement

Net Interest Income

26,967

25,599

24,996

24,631

25,314

Provision for (Recovery of) Credit Losses

2,175

—

600

750

(250

)

Noninterest Income

2,533

1,522

1,763

1,550

1,409

Noninterest Expense

16,812

15,760

15,539

15,189

15,740

Net Income

8,204

8,675

8,115

7,831

8,873

Net Income Available to Common Shareholders

7,190

7,662

7,101

6,818

7,859

Per Common Share Data

Basic Earnings Per Share

0.26

0.28

0.26

0.25

0.28

Diluted Earnings Per Share

0.26

0.27

0.26

0.24

0.28

Adjusted Diluted Earnings Per Share (1)

0.27

0.28

0.26

0.24

0.28

Book Value Per Share

14.21

14.06

13.63

13.30

12.94

Tangible Book Value Per Share (1)

13.49

13.96

13.53

13.20

12.84

Basic Weighted Average Shares Outstanding

27,459,433

27,382,798

27,386,713

27,691,401

27,870,430

Diluted Weighted Average Shares Outstanding

28,055,532

27,904,910

27,748,184

28,089,805

28,238,056

Shares Outstanding at Period End

27,552,449

27,425,690

27,348,049

27,589,827

27,748,965

Financial Ratios

Return on Average Assets (2)

0.68

0.73

0.70

0.69

0.77

Pre-Provision Net Revenue Return on Average Assets (1)(2)

1.05

0.96

0.94

0.95

0.96

Return on Average Shareholders' Equity (2)

7.16

7.79

7.49

7.35

8.43

Return on Average Tangible Common Equity (1)(2)

7.43

8.16

7.80

7.64

8.95

Net Interest Margin (3)

2.32

2.24

2.27

Core Net Interest Margin (1)(3)

2.25

2.16

2.17

2.18

2.21

Cost of Total Deposits

3.40

3.58

3.46

3.32

3.19

Cost of Funds

3.38

3.54

3.49

3.34

3.23

Efficiency Ratio (1)

56.8

58.0

58.7

58.2

58.8

Noninterest Expense to Average Assets (2)

1.40

1.33

1.35

1.33

1.37

Adjusted Financial Ratios (1)

Adjusted Return on Average Assets (2)

0.71

0.75

0.70

0.69

0.77

Adjusted Pre-Provision Net Revenue Return on Average Assets (2)

1.09

0.98

0.94

0.95

0.96

Adjusted Return on Average Shareholders' Equity (2)

7.49

7.94

7.49

7.35

8.43

Adjusted Return on Average Tangible Common Equity (2)

7.82

8.34

7.80

7.64

8.95

Adjusted Efficiency Ratio

55.2

57.2

58.7

58.2

58.8

Adjusted Noninterest Expense to Average Assets (2)

1.36

1.31

1.35

1.33

1.37

Balance Sheet

Total Assets

5,066,242

4,691,517

4,687,035

4,723,109

4,611,990

Total Loans, Gross

3,868,514

3,685,590

3,800,385

3,784,205

3,724,282

Deposits

4,086,767

3,747,442

3,807,712

3,807,225

3,709,948

Total Shareholders' Equity

457,935

452,200

439,241

433,611

425,515

Loan to Deposit Ratio

94.7

98.3

99.8

99.4

100.4

Core Deposits to Total Deposits (4)

76.0

71.5

67.9

69.3

68.7

Uninsured Deposits to Total Deposits

27.7

25.0

22.5

26.0

24.3

Asset Quality

Net Loan Charge-Offs to Average Loans (2)

0.03

0.10

0.00

0.01

Nonperforming Assets to Total Assets (5)

0.01

0.19

0.01

0.02

Allowance for Credit Losses to Total Loans

1.35

1.38

1.37

1.36

As of and for the Three Months Ended

December 31,

September 30,

June 30,

March 31,

December 31,

(dollars in thousands)

2024

2023

(Unaudited)

Capital Ratios (Consolidated) (6)

Tier 1 Leverage Ratio

9.45

9.75

9.66

9.57

Common Equity Tier 1 Risk-based Capital Ratio

9.08

9.79

9.41

9.21

9.16

Tier 1 Risk-based Capital Ratio

10.64

11.44

11.03

10.83

10.79

Total Risk-based Capital Ratio

13.76

14.62

14.16

14.00

13.97

Tangible Common Equity to Tangible Assets (1)

7.36

8.17

7.90

7.72

7.73

_______________________

(1)

Represents a non-GAAP financial measure. See "Non-GAAP Financial Measures" for further details.

(2)

Annualized.

(3)

Amounts calculated on a tax-equivalent basis using the statutory federal tax rate of 21%.

(4)

Core deposits are defined as total deposits less brokered deposits and certificates of deposit greater than $250,000.

(5)

Nonperforming assets are defined as nonaccrual loans plus 90 days past due and still accruing plus foreclosed assets.

(6)

Preliminary data. Current period subject to change prior to filings with applicable regulatory agencies.

Bridgewater Bancshares, Inc. and Subsidiaries

Consolidated Balance Sheets

(dollars in thousands, except share data)

December 31,

September 30,

June 30,

March 31,

December 31,

2024

2023

(Unaudited)

Assets

Cash and Cash Equivalents

229,760

191,859

134,093

143,355

128,562

Bank-Owned Certificates of Deposit

4,377

—

Securities Available for Sale, at Fair Value

768,247

664,715

601,057

633,282

604,104

Loans, Net of Allowance for Credit Losses

3,809,436

3,628,867

3,742,222

3,726,502

3,667,215

Federal Home Loan Bank (FHLB) Stock, at Cost

19,297

18,626

15,844

17,195

17,097

Premises and Equipment, Net

49,533

47,777

47,902

48,299

48,886

Foreclosed Assets

—

434

—

Accrued Interest

17,711

16,750

16,944

16,696

16,697

Goodwill

11,982

2,626

Other Intangible Assets, Net

7,850

163

171

180

188

Bank-Owned Life Insurance

44,646

38,219

35,090

34,778

34,477

Other Assets

103,403

81,481

91,086

100,176

92,138

Total Assets

5,066,242

4,691,517

4,687,035

4,723,109

4,611,990

Liabilities and Equity

Liabilities

Deposits:

Noninterest Bearing

800,763

713,309

705,175

698,432

756,964

Interest Bearing

3,286,004

3,034,133

3,102,537

3,108,793

2,952,984

Total Deposits

4,086,767

3,747,442

3,807,712

3,807,225

3,709,948

Notes Payable

13,750

FHLB Advances

359,500

349,500

287,000

317,000

319,500

Subordinated Debentures, Net of Issuance Costs

79,670

79,574

79,479

79,383

79,288

Accrued Interest Payable

4,008

3,458

3,999

4,405

5,282

Other Liabilities

64,612

45,593

55,854

67,735

58,707

Total Liabilities

4,608,307

4,239,317

4,247,794

4,289,498

4,186,475

Shareholders' Equity

Preferred Stock- $0.01 par value; Authorized 10,000,000

Preferred Stock - Issued and Outstanding 27,600 Series A shares ($2,500 liquidation preference) at December 31, 2024 (unaudited), September 30, 2024 (unaudited), June 30, 2024 (unaudited), March 31, 2024 (unaudited), and December 31, 2023

66,514

Common Stock- $0.01 par value; Authorized 75,000,000

Common Stock - Issued and Outstanding 27,552,449 at December 31, 2024 (unaudited), 27,425,690 at September 30, 2024 (unaudited), 27,348,049 at June 30, 2024 (unaudited), 27,589,827 at March 31, 2024 (unaudited), and 27,748,965 at December 31, 2023

276

274

273

276

277

Additional Paid-In Capital

95,088

94,597

93,205

95,069

96,320

Retained Earnings

309,421

302,231

294,569

287,468

280,650

Accumulated Other Comprehensive Loss

(13,364

)

(11,416

)

(15,320

)

(15,716

)

(18,246

)

Total Shareholders' Equity

457,935

452,200

439,241

433,611

425,515

Total Liabilities and Equity

5,066,242

4,691,517

4,687,035

4,723,109

4,611,990

Bridgewater Bancshares, Inc. and Subsidiaries

Consolidated Statements of Income

(dollars in thousands, except per share data)

Three Months Ended

Year Ended

December 31,

September 30,

June 30,

March 31,

December 31,

2024

2023

2024

2023

(Unaudited)

Interest Income

Loans, Including Fees

51,870

51,895

51,385

49,581

49,727

204,731

191,402

Investment Securities

9,109

8,725

8,177

7,916

7,283

33,927

26,245

Other

2,345

2,407

1,316

1,172

1,543

7,240

4,708

Total Interest Income

63,324

63,027

60,878

58,669

58,553

245,898

222,355

Interest Expense

Deposits

32,810

34,187

31,618

30,190

29,448

128,805

96,045

Federal Funds Purchased

853

304

268

1,201

8,521

Notes Payable

275

296

295

299

1,162

1,143

FHLB Advances

2,229

1,942

2,125

2,258

2,220

8,554

7,489

Subordinated Debentures

1,001

990

991

1,004

3,983

Total Interest Expense

36,357

37,428

35,882

34,038

33,239

143,705

117,181

Net Interest Income

26,967

25,599

24,996

24,631

25,314

102,193

105,174

Provision for (Recovery of) Credit Losses

2,175

—

600

750

(250

)

3,525

(175

)

Net Interest Income After Provision for (Recovery of) Credit Losses

24,792

25,599

24,396

23,881

25,564

98,668

105,349

Noninterest Income

Customer Service Fees

394

373

366

342

359

1,475

1,455

Net Gain (Loss) on Sales of Securities

—

(28

)

320

(27

)

385

(33

)

Net Gain on Sales of Foreclosed Assets

—

Letter of Credit Fees

849

424

387

316

418

1,976

1,746

Debit Card Interchange Fees

145

152

155

141

152

593

595

Swap Fees

521

—

547

—

Bank-Owned Life Insurance

362

352

312

301

268

1,327

992

FHLB Prepayment Income

—

792

Other Income

200

223

357

239

1,003

946

Total Noninterest Income

2,533

1,522

1,763

1,550

1,409

7,368

6,493

Noninterest Expense

Salaries and Employee Benefits

10,605

9,851

9,675

9,433

9,615

39,564

36,538

Occupancy and Equipment

1,181

1,069

1,092

1,057

1,062

4,399

4,447

FDIC Insurance Assessment

609

750

725

875

1,050

2,959

3,690

Data Processing

445

368

472

412

424

1,697

1,574

Professional and Consulting Fees

989

1,149

852

889

782

3,879

3,081

Derivative Collateral Fees

426

381

528

486

573

1,821

1,900

Information Technology and Telecommunications

877

840

812

796

812

3,325

2,889

Marketing and Advertising

479

367

317

322

324

1,485

1,129

Intangible Asset Amortization

100

Other Expense

1,149

976

1,058

910

1,089

4,093

3,972

Total Noninterest Expense

16,812

15,760

15,539

15,189

15,740

63,300

59,320

Income Before Income Taxes

10,513

11,361

10,620

10,242

11,233

42,736

52,522

Provision for Income Taxes

2,309

2,686

2,505

2,411

2,360

9,911

12,562

Net Income

8,204

8,675

8,115

7,831

8,873

32,825

39,960

Preferred Stock Dividends

(1,014

)

(1,013

)

(1,014

)

(1,013

)

(1,014

)

(4,054

)

(4,054

)

Net Income Available to Common Shareholders

7,190

7,662

7,101

6,818

7,859

28,771

35,906

Earnings Per Share

Basic

0.26

0.28

0.26

0.25

0.28

1.05

1.29

Diluted

0.26

0.27

0.26

0.24

0.28

1.03

1.27

Bridgewater Bancshares, Inc. and Subsidiaries

Analysis of Average Balances, Yields and Rates

(dollars in thousands, except per share data)

(Unaudited)

For the Three Months Ended

December 31, 2024

September 30, 2024

December 31, 2023

Average

Interest

Yield/

Average

Interest

Yield/

Average

Interest

Yield/

(dollars in thousands)

Balance

& Fees

Rate

Balance

& Fees

Rate

Balance

& Fees

Rate

Interest Earning Assets:

Cash Investments

181,904

1,968

4.30

157,114

1,971

4.99

106,275

1,233

4.60

Investment Securities:

Taxable Investment Securities

723,038

8,814

4.85

668,429

8,406

5.00

600,856

7,007

4.63

Tax-Exempt Investment Securities (1)

28,681

374

5.19

31,496

402

5.08

29,172

350

4.75

Total Investment Securities

751,719

9,188

4.86

699,925

8,808

5.01

630,028

7,357

4.63

Loans (1)(2)

3,730,532

52,078

5.55

3,721,654

52,118

5.57

3,726,126

50,022

5.33

Federal Home Loan Bank Stock

18,686

377

8.02

16,828

436

10.31

17,999

310

6.85

Total Interest Earning Assets

4,682,841

63,611

5.40

4,595,521

63,333

5.48

4,480,428

58,922

5.22

Noninterest Earning Assets

105,195

108,283

87,018

Total Assets

4,788,036

4,703,804

4,567,446

Interest Bearing Liabilities:

Deposits:

Interest Bearing Transaction Deposits

836,155

8,962

4.26

804,161

9,369

4.63

719,630

7,546

4.16

Savings and Money Market Deposits

1,073,194

10,795

4.00

939,665

10,262

4.34

911,835

9,003

3.92

Time Deposits

336,917

3,650

4.31

355,050

3,918

4.39

268,140

2,330

3.45

Brokered Deposits

875,015

9,403

4.27

989,712

10,638

4.28

1,009,166

10,569

4.16

Total Interest Bearing Deposits

3,121,281

32,810

4.18

3,088,588

34,187

4.40

2,908,771

29,448

4.02

Federal Funds Purchased

3,290

5.09

141

5.72

18,932

268

5.62

Notes Payable

13,750

275

7.95

13,750

296

8.58

13,750

299

8.62

FHLB Advances

347,652

2,229

2.55

309,120

1,942

2.50

303,467

2,220

2.90

Subordinated Debentures

79,616

1,001

5.00

79,519

1,001

5.01

79,233

1,004

5.02

Total Interest Bearing Liabilities

3,565,589

36,357

4.06

3,491,118

37,428

4.27

3,324,153

33,239

3.97

Noninterest Bearing Liabilities:

Noninterest Bearing Transaction Deposits

718,227

710,192

753,430

Other Noninterest Bearing Liabilities

48,271

59,417

72,074

Total Noninterest Bearing Liabilities

766,498

769,609

825,504

Shareholders' Equity

455,949

443,077

417,789

Total Liabilities and Shareholders' Equity

4,788,036

4,703,804

4,567,446

Net Interest Income / Interest Rate Spread

27,254

1.35

25,905

1.21

25,683

1.25

Net Interest Margin (3)

2.32

2.24

2.27

Taxable Equivalent Adjustment:

Tax-Exempt Investment Securities and Loans

(287

)

(306

)

(369

)

Net Interest Income

26,967

25,599

25,314

_______________________ (1)

Interest income and average rates for tax-exempt investment securities and loans are presented on a tax-equivalent basis, assuming a statutory federal income tax rate of 21%.

(2)

Average loan balances include nonaccrual loans. Interest income on loans includes amortization of deferred loan fees, net of deferred loan costs.

(3)

Net interest margin includes the tax equivalent adjustment and represents the annualized results of: (i) the difference between interest income on interest earning assets and the interest expense on interest bearing liabilities, divided by (ii) average interest earning assets for the period.

Bridgewater Bancshares, Inc. and Subsidiaries

Analysis of Average Balances, Yields and Rates

(dollars in thousands, except per share data)

(Unaudited)

For the Year Ended

December 31, 2024

December 31, 2023

Average

Interest

Yield/

Average

Interest

Yield/

(dollars in thousands)

Balance

& Fees

Rate

Balance

& Fees

Rate

Interest Earning Assets:

Cash Investments

124,205

5,690

4.58

77,759

3,170

4.08

Investment Securities:

Taxable Investment Securities

668,012

32,681

4.89

577,102

25,199

4.37

Tax-Exempt Investment Securities (1)

30,864

1,577

5.11

29,004

1,325

4.57

Total Investment Securities

698,876

34,258

4.90

606,106

26,524

4.38

Loans (1)(2)

3,738,260

205,646

5.50

3,699,252

192,679

5.21

Federal Home Loan Bank Stock

18,256

1,550

8.49

21,249

1,538

7.24

Total Interest Earning Assets

4,579,597

247,144

5.40

4,404,366

223,911

5.08

Noninterest Earning Assets

103,547

86,438

Total Assets

4,683,144

4,490,804

Interest Bearing Liabilities:

Deposits:

Interest Bearing Transaction Deposits

776,768

34,294

4.41

650,028

23,379

3.60

Savings and Money Market Deposits

956,300

39,297

4.11

922,799

30,639

3.32

Time Deposits

342,582

14,585

4.26

263,161

7,064

2.68

Brokered Deposits

963,676

40,629

4.22

909,662

34,963

3.84

Total Interest Bearing Deposits

3,039,326

128,805

4.24

2,745,650

96,045

3.50

Federal Funds Purchased

21,493

1,201

5.59

169,645

8,521

5.02

Notes Payable

13,750

1,162

8.45

13,750

1,143

8.31

FHLB Advances

320,497

8,554

2.67

238,000

7,489

3.15

Subordinated Debentures

79,473

3,983

5.01

79,090

3,983

5.04

Total Interest Bearing Liabilities

3,474,539

143,705

4.14

3,246,135

117,181

3.61

Noninterest Bearing Liabilities:

Noninterest Bearing Transaction Deposits

705,247

768,428

Other Noninterest Bearing Liabilities

62,595

65,763

Total Noninterest Bearing Liabilities

767,842

834,191

Shareholders' Equity

440,763

410,478

Total Liabilities and Shareholders' Equity

4,683,144

4,490,804

Net Interest Income / Interest Rate Spread

103,439

1.26

106,730

1.47

Net Interest Margin (3)

2.26

2.42

Taxable Equivalent Adjustment:

Tax-Exempt Investment Securities and Loans

(1,246

)

(1,556

)

Net Interest Income

102,193

105,174

Bridgewater Bancshares, Inc. and Subsidiaries

Asset Quality Summary

(dollars in thousands)

(unaudited)

As of and for the Three Months Ended

As of and for the Year Ended

December 31,

September 30,

June 30,

March 31,

December 31,

(dollars in thousands)

2024

2023

2024

2023

Allowance for Credit Losses

Balance at Beginning of Period

51,018

51,949

51,347

50,494

50,585

50,494

47,996

Impact of Adopting CECL

—

650

Day 1 PCD Allowance

114

—

114

—

Provision for Credit Losses (1)

1,450

—

600

850

—

2,900

2,050

Charge-offs

(317

)

(937

)

(10

)

(95

)

(1,266

)

(224

)

Recoveries

Net Charge-offs

(305

)

(931

)

(91

)

(1,231

)

(202

)

Balance at End of Period

52,277

51,018

51,949

51,347

50,494

52,277

50,494

Allowance for Credit Losses to Total Loans

1.35

1.38

1.37

1.36

1.35

1.36

_______________________ (1)

Includes a day 1 provision for credit losses for non-PCD loans acquired in the FMCB transanction of $950,000 for the three and twelve months ended December 31, 2024.

As of and for the Three Months Ended

As of and for the Year Ended

December 31,

September 30,

June 30,

March 31,

December 31,

(dollars in thousands)

2024

2023

2024

2023

Provision for Credit Losses on Loans

1,450

—

600

850

—

2,900

2,050

Provision for (Recovery of) Credit Losses for Off-Balance Sheet Credit Exposures

725

—

(100

)

(250

)

625

(2,225

)

Provision for (Recovery of) Credit Losses

2,175

—

600

750

(250

)

3,525

(175

)

As of and for the Three Months Ended

December 31,

September 30,

June 30,

March 31,

December 31,

(dollars in thousands)

2024

2023

Selected Asset Quality Data

Loans 30-89 Days Past Due

1,291

502

—

15,110

Loans 30-89 Days Past Due to Total Loans

0.03

0.00

0.01

0.00

0.41

Nonperforming Loans

301

8,378

678

249

919

Nonperforming Loans to Total Loans

0.01

0.23

0.02

0.01

0.02

Nonaccrual Loans to Total Loans

0.01

0.23

0.02

0.01

0.02

Nonaccrual Loans and Loans Past Due 90 Days and Still Accruing to Total Loans

0.01

0.23

0.02

0.01

0.02

Foreclosed Assets

—

434

—

Nonperforming Assets (1)

301

8,812

678

269

919

Nonperforming Assets to Total Assets (1)

0.01

0.19

0.01

0.02

Net Loan Charge-Offs (Annualized) to Average Loans

0.03

0.10

0.00

0.01

Special Mention/Watchlist Risk Rated Loans

46,581

31,991

30,436

21,624

26,485

Substandard Risk Rated Loans

21,791

31,637

33,908

33,829

35,858

_______________________ (1)

Nonperforming assets are defined as nonaccrual loans plus 90 days past due and still accruing plus foreclosed assets.

Bridgewater Bancshares, Inc. and Subsidiaries

Non-GAAP Financial Measures

(dollars in thousands)

(unaudited)

For the Three Months Ended

For the Year Ended

December 31,

September 30,

June 30,

March 31,

December 31,

(dollars in thousands)

2024

2023

2024

2023

Pre-Provision Net Revenue

Noninterest Income

2,533

1,522

1,763

1,550

1,409

7,368

6,493

Less: (Gain) Loss on Sales of Securities

—

(320

)

(93

)

(385

)

Less: FHLB Advance Prepayment Income

—

(792

)

Total Operating Noninterest Income

2,533

1,550

1,443

1,457

1,436

6,983

5,734

Plus: Net Interest Income

26,967

25,599

24,996

24,631

25,314

102,193

105,174

Net Operating Revenue

29,500

27,149

26,439

26,088

26,750

109,176

110,908

Noninterest Expense

16,812

15,760

15,539

15,189

15,740

63,300

59,320

Total Operating Noninterest Expense

16,812

15,760

15,539

15,189

15,740

63,300

59,320

Pre-Provision Net Revenue

12,688

11,389

10,900

10,899

11,010

45,876

51,588

Plus:

Non-Operating Revenue Adjustments

—

(28

)

320

(27

)

385

759

Less:

Provision (Recovery of) for Credit Losses

2,175

—

600

750

(250

)

3,525

(175

)

Provision for Income Taxes

2,309

2,686

2,505

2,411

2,360

9,911

12,562

Net Income

8,204

8,675

8,115

7,831

8,873

32,825

39,960

Average Assets

4,788,036

4,703,804

4,646,517

4,592,838

4,567,446

4,683,144

4,490,804

Pre-Provision Net Revenue Return on Average Assets

1.05

0.96

0.94

0.95

0.96

0.98

1.15

Adjusted Pre-Provision Net Revenue

Net Operating Revenue

29,500

27,149

26,439

26,088

26,750

109,176

110,908

Noninterest Expense

16,812

15,760

15,539

15,189

15,740

63,300

59,320

Less: Merger-related Expenses

(488

)

(224

)

—

(712

)

—

Adjusted Total Operating Noninterest Expense

16,324

15,536

15,539

15,189

15,740

62,588

59,320

Adjusted Pre-Provision Net Revenue

13,176

11,613

10,900

10,899

11,010

46,588

51,588

Adjusted Pre-Provision Net Revenue Return on Average Assets

1.09

0.98

0.94

0.95

0.96

0.99

1.15

Core Net Interest Margin

Net Interest Income (Tax-equivalent Basis)

27,255

25,905

25,288

24,992

25,683

103,440

106,730

Less: Loan Fees

(747

)

(968

)

(767

)

(608

)

(751

)

(3,090

)

(3,604

)

Core Net Interest Income

26,508

24,937

24,521

24,384

24,932

100,350

103,126

Average Interest Earning Assets

4,682,841

4,595,521

4,545,920

4,492,756

4,480,428

4,579,597

4,404,366

Core Net Interest Margin

2.25

2.16

2.17

2.18

2.21

2.19

2.34

Efficiency Ratio

Noninterest Expense

16,812

15,760

15,539

15,189

15,740

63,300

59,320

Less: Amortization of Intangible Assets

(52

)

(78

)

(100

)

Adjusted Noninterest Expense

16,760

15,751

15,531

15,180

15,731

63,222

59,220

Net Interest Income

26,967

25,599

24,996

24,631

25,314

102,193

105,174

Noninterest Income

2,533

1,522

1,763

1,550

1,409

7,368

6,493

Less: Gain (Loss) on Sales of Securities

—

(320

)

(93

)

(385

)

Adjusted Operating Revenue

29,500

27,149

26,439

26,088

26,750

109,176

111,700

Efficiency Ratio

56.8

58.0

58.7

58.2

58.8

57.9

53.0

Adjusted Efficiency Ratio

Noninterest Expense

16,812

15,760

15,539

15,189

15,740

63,300

59,320

Less: Amortization of Intangible Assets

(52

)

(78

)

(100

)

Less: Merger-related Expenses

(488

)

(224

)

—

(712

)

—

Adjusted Noninterest Expense

16,272

15,527

15,531

15,180

15,731

62,510

59,220

Net Interest Income

26,967

25,599

24,996

24,631

25,314

102,193

105,174

Noninterest Income

2,533

1,522

1,763

1,550

1,409

7,368

6,493

Less: Gain (Loss) on Sales of Securities

—

(320

)

(93

)

(385

)

Adjusted Operating Revenue

29,500

27,149

26,439

26,088

26,750

109,176

111,700

Adjusted Efficiency Ratio

55.2

57.2

58.7

58.2

58.8

57.3

53.0

Bridgewater Bancshares, Inc. and Subsidiaries

Non-GAAP Financial Measures

(dollars in thousands)

(unaudited)

For the Three Months Ended

For the Year Ended

December 31,

September 30,

June 30,

March 31,

December 31,

(dollars in thousands)

2024

2023

2024

2023

Adjusted Noninterest Expense to Average Assets (Annualized)

Noninterest Expense

16,812

15,760

15,539

15,189

15,740

63,300

59,320

Less: Merger-related Expenses

(488

)

(224

)

—

(712

)

—

Adjusted Noninterest Expense

16,324

15,536

15,539

15,189

15,740

62,588

59,320

Average Assets

4,788,036

4,703,804

4,646,517

4,592,838

4,567,446

4,683,144

4,490,804

Adjusted Noninterest Expense to Average Assets (Annualized)

1.36

1.31

1.35

1.33

1.37

1.34

1.32

Tangible Common Equity and Tangible Common Equity/Tangible Assets

Total Shareholders' Equity

457,935

452,200

439,241

433,611

425,515

Less: Preferred Stock

(66,514

)

(66,514

)

(66,514

)

(66,514

)

(66,514

)

Total Common Shareholders' Equity

391,421

385,686

372,727

367,097

359,001

Less: Intangible Assets

(19,832

)

(2,789

)

(2,797

)

(2,806

)

(2,814

)

Tangible Common Equity

371,589

382,897

369,930

364,291

356,187

Total Assets

5,066,242

4,691,517

4,687,035

4,723,109

4,611,990

Less: Intangible Assets

(19,832

)

(2,789

)

(2,797

)

(2,806

)

(2,814

)

Tangible Assets

5,046,410

4,688,728

4,684,238

4,720,303

4,609,176

Tangible Common Equity/Tangible Assets

7.36

8.17

7.90

7.72

7.73

Tangible Book Value Per Share

Book Value Per Common Share

14.21

14.06

13.63

13.30

12.94

Less: Effects of Intangible Assets

(0.72

)

(0.10

)

(0.10

)

(0.10

)

(0.10

)

Tangible Book Value Per Common Share

13.49

13.96

13.53

13.20

12.84

Return on Average Tangible Common Equity

Net Income Available to Common Shareholders

7,190

7,662

7,101

6,818

7,859

28,771

35,906

Average Shareholders' Equity

455,949

443,077

435,585

428,248

417,789

440,763

410,478

Less: Average Preferred Stock

(66,514

)

(66,514

)

(66,514

)

(66,514

)

(66,514

)

(66,514

)

(66,514

)

Average Common Equity

389,435

376,563

369,071

361,734

351,275

374,249

343,964

Less: Effects of Average Intangible Assets

(4,412

)

(2,794

)

(2,802

)

(2,811

)

(2,819

)

(3,207

)

(2,847

)

Average Tangible Common Equity

385,023

373,769

366,269

358,923

348,456

371,042

341,117

Return on Average Tangible Common Equity

7.43

8.16

7.80

7.64

8.95

7.75

10.53

Adjusted Diluted Earnings Per Common Share

Net Income Available to Common Shareholders

7,190

7,662

7,101

6,818

7,859

28,771

35,906

Add: Merger-related Expenses

488

224

—

712

—

Less: Tax Impact

(107

)

(53

)

—

(165

)

—

Net Income Available to Common Shareholders, Excluding Impact of Merger-related Expenses

7,571

7,833

7,101

6,818

7,859

29,318

35,906

Diluted Weighted Average Shares Outstanding

28,055,532

27,904,910

27,748,184

28,089,805

28,238,056

27,943,343

28,315,587

Adjusted Diluted Earnings Per Common Share

0.27

0.28

0.26

0.24

0.28

1.05

1.27

Adjusted Return on Average Assets

Net Income

8,204

8,675

8,115

7,831

8,873

32,825

39,960

Add: Merger-related Expenses

488

224

—

712

—

Less: Tax Impact

(107

)

(53

)

—

(165

)

—

Net Income, Excluding Impact of Merger-related Expenses

8,585

8,846

8,115

7,831

8,873

33,372

39,960

Average Assets

4,788,036

4,703,804

4,646,517

4,592,838

4,567,446

4,683,144

4,490,804

Adjusted Return on Average Assets

0.71

0.75

0.70

0.69

0.77

0.71

0.89

Adjusted Return on Average Shareholders' Equity

Net Income, Excluding Impact of Merger-related Expenses

8,585

8,846

8,115

7,831

8,873

33,372

39,960

Average Shareholders' Equity

455,949

443,077

435,585

428,248

417,789

440,763

410,478

Adjusted Return on Average Shareholders' Equity

7.49

7.94

7.49

7.35

8.43

7.57

9.73

Adjusted Return on Average Tangible Common Equity

Net Income Available to Common Shareholders, Excluding Impact of Merger-related Expenses

7,571

7,833

7,101

6,818

7,859

29,318

35,906

Average Tangible Common Equity

385,023

373,769

366,269

358,923

348,456

371,042

341,117

Adjusted Return on Average Tangible Common Equity

7.82

8.34

7.80

7.64

8.95

7.90

10.53

View source version on businesswire.com: https://www.businesswire.com/news/home/20250128985553/en/

Media Contact: Jessica Stejskal | SVP Marketing Jessica.Stejskal@bwbmn.com | 952.893.6860

Investor Contact: Justin Horstman | VP Investor Relations Justin.Horstman@bwbmn.com | 952.542.5169

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