Bridgewater Bancshares, Inc. (NASDAQ:BWB) Q1 2024 Earnings Conference Call April 25, 2024 9:00 AM ET Company Participants Justin Horstman - Vice President of Investor Relations Jerry Baack - President and Chief Executive Officer Joe Chybowski - Chief Financial Officer Jeff Shellberg - Chief Credit Officer Nick Place - Chief Lending Officer Conference Call Participants Brendan Nosal - Hovde Group Nathan Race - Piper Sandler Jeffrey Rulis - D.A. Davidson Operator Good morning, and welcome to the Bridgewater B ...

Bridgewater (BWB) came out with quarterly earnings of $0.24 per share, missing the Zacks Consensus Estimate of $0.25 per share. This compares to earnings of $0.37 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of -4%. A quarter ago, it was expected that this company would post earnings of $0.26 per share when it actually produced earnings of $0.28, delivering a surprise of 7.69%.Over the last four quarters, the company has surpa ...

Exhibit 99.1 Media Contact: Jessica Stejskal | SVP Marketing Jessica.Stejskal@bwbmn.com | 952.893.6860 April 24, 2024 First Quarter 2024 Highlights ● Repurchased 193,802 shares of common stock at a weighted average price of $11.75 per share, for a total of $2.3 million. ● Loan-to-deposit ratio of 99.4%, compared to 100.4% at December 31, 2023. ● Efficiency ratio(1) of 58.2%, compared to 58.8% for the fourth quarter of 2023. Page 1 of 16 "During the first quarter, we also saw net interest margin compression ...

Financial Performance - Net Interest Income decreased to $105.2 million in 2023 from $129.7 million in 2022, a decline of 18.9%[253] - Net Income Available to Common Shareholders dropped to $39.96 million in 2023 from $53.39 million in 2022, a decrease of 25.2%[253] - Return on Average Assets (ROA) decreased to 0.89% in 2023 from 1.38% in 2022[253] - Efficiency Ratio worsened to 53.0% in 2023 from 41.5% in 2022[253] Asset and Loan Growth - Total Assets grew by 6.1% to $4.61 billion in 2023 from $4.35 billion in 2022[253] - Total Loans, Gross increased by 4.3% to $3.72 billion in 2023 from $3.57 billion in 2022[253] - Total interest-bearing deposits increased to $2.75 billion in 2023, up from $2.22 billion in 2022, with an average interest rate of 3.50%[268] Credit Quality - Nonperforming Loans to Total Loans ratio remained stable at 0.02% in 2023, consistent with 2022[254] - Allowance for Credit Losses on Loans to Total Loans ratio was 1.36% in 2023, slightly up from 1.34% in 2022[254] - Net Loan Charge-Offs to Average Loans ratio was 0.01% in 2023, compared to -0.01% in 2022[254] - The allowance for credit losses on loans is adjusted based on provisions or recoveries reported in the income statement, impacting the allowance for credit losses on off-balance sheet exposures[258] Interest Rate and Net Interest Margin - Net interest income is calculated on a tax-equivalent basis, with a 21% federal tax rate assumption, and is influenced by the FOMC's rate increases of 100 basis points in 2023 and 425 basis points in 2022[266] - The net interest margin for 2023 was 2.42%, compared to 3.45% in 2022 and 3.54% in 2021[269] - The company's net interest income would decrease by 2.39% in the event of an immediate and sustained 400 basis point increase in interest rates[796] - The company's net interest income would increase by 8.86% in the event of an immediate 300 basis point decrease in interest rates[796] - Forecasted net interest income for a +400 basis point change is $118,597, representing a 2.39% decrease from the base[797] - Forecasted net interest income for a +300 basis point change is $118,983, representing a 2.08% decrease from the base[797] - Forecasted net interest income for a +200 basis point change is $119,395, representing a 1.74% decrease from the base[797] - Forecasted net interest income for a +100 basis point change is $119,916, representing a 1.31% decrease from the base[797] - Forecasted net interest income for a -100 basis point change is $125,138, representing a 2.99% increase from the base[797] - Forecasted net interest income for a -200 basis point change is $128,643, representing a 5.87% increase from the base[797] - Forecasted net interest income for a -300 basis point change is $132,269, representing an 8.86% increase from the base[797] - The company uses a net interest income simulation model to measure potential changes in net interest income over the next 12 months, assuming no growth in interest-sensitive assets or liabilities[795] Capital and Risk Management - Tier 1 Leverage Ratio improved slightly to 9.57% in 2023 from 9.55% in 2022[253] - The Company's cash flow hedges had a total notional amount of $308.0 million at December 31, 2023, up from $288.0 million in 2022, aimed at managing interest rate exposure[794] Fair Value Measurement - The fair value of investment securities is determined using pricing models, broker quotes, and net present value of future cash flows, with adjustments made if a more appropriate fair value is identified[260] - The Company uses a three-level hierarchy to measure the fair value of financial instruments, considering observable market data and matrix pricing for non-traded instruments[261][263]

Bridgewater Bancshares, Inc. (NASDAQ:BWB) Q4 2023 Earnings Conference Call January 25, 2024 9:00 AM ET Company Participants Justin Horstman - Vice President, Investor Relations Jerry Baack - Chairman, President and Chief Executive Officer Joe Chybowski - Chief Financial Officer Nick Place - Chief Lending Officer Jeff Shellberg - Chief Credit Officer Conference Call Participants Jeff Rulis - D.A. Davidson Nathan Race - Piper Sandler Operator Good morning, and welcome to the Bridgewater Bancshares 2023 Fourth ...

ST. LOUIS PARK, Minn.--(BUSINESS WIRE)--Bridgewater Bancshares, Inc. (Nasdaq: BWB) (the Company), the parent company of Bridgewater Bank (the Bank), today announced net income of $8.9 million for the fourth quarter of 2023, compared to $9.6 million for the third quarter of 2023, and $13.7 million for the fourth quarter of 2022. Earnings per diluted common share were $0.28 for the fourth quarter of 2023, compared to $0.30 for the third quarter of 2023, and $0.45 for the fourth quarter of 2022. “Bridgewate ...

[PART I FINANCIAL INFORMATION](index=3&type=section&id=PART%20I%20FINANCIAL%20INFORMATION) This part presents the company's unaudited financial statements, management's analysis, market risk disclosures, and control procedures [Consolidated Financial Statements (unaudited)](index=3&type=section&id=Item%201.%20Consolidated%20Financial%20Statements%20(unaudited)) Presents the unaudited consolidated financial statements and notes, highlighting the adoption of the CECL accounting standard [Consolidated Balance Sheets](index=3&type=section&id=Consolidated%20Balance%20Sheets) Consolidated Balance Sheet Highlights (in thousands) | Metric | Sep 30, 2023 (Unaudited) | Dec 31, 2022 | | :--- | :--- | :--- | | **Total Assets** | **$4,557,070** | **$4,345,662** | | Total Loans, Net | $3,664,464 | $3,512,157 | | **Total Liabilities** | **$4,141,110** | **$3,951,598** | | Total Deposits | $3,675,509 | $3,416,543 | | **Total Shareholders' Equity** | **$415,960** | **$394,064** | [Consolidated Statements of Income](index=4&type=section&id=Consolidated%20Statements%20of%20Income) Income Statement Highlights (in thousands, except per share) | Metric (in thousands, except per share) | Three Months Ended Sep 30, 2023 | Three Months Ended Sep 30, 2022 | Nine Months Ended Sep 30, 2023 | Nine Months Ended Sep 30, 2022 | | :--- | :--- | :--- | :--- | :--- | | Net Interest Income | $25,421 | $34,095 | $79,860 | $96,805 | | Provision for Credit Losses | ($600) | $1,500 | $75 | $6,200 | | **Net Income** | **$9,629** | **$14,513** | **$31,087** | **$39,657** | | **Diluted EPS** | **$0.30** | **$0.47** | **$0.99** | **$1.27** | [Consolidated Statements of Comprehensive Income](index=5&type=section&id=Consolidated%20Statements%20of%20Comprehensive%20Income) Comprehensive Income Highlights (in thousands) | Metric (in thousands) | Three Months Ended Sep 30, 2023 | Three Months Ended Sep 30, 2022 | Nine Months Ended Sep 30, 2023 | Nine Months Ended Sep 30, 2022 | | :--- | :--- | :--- | :--- | :--- | | Net Income | $9,629 | $14,513 | $31,087 | $39,657 | | Total Other Comprehensive Loss, Net of Tax | ($2,858) | ($5,659) | ($5,824) | ($25,726) | | **Comprehensive Income** | **$6,771** | **$8,854** | **$25,263** | **$13,931** | [Consolidated Statements of Shareholders' Equity](index=6&type=section&id=Consolidated%20Statements%20of%20Shareholders'%20Equity) - Total Shareholders' Equity increased from **$394.1 million** at December 31, 2022, to **$416.0 million** at September 30, 2023, driven by net income and partially offset by the CECL adoption and other comprehensive loss[16](index=16&type=chunk)[18](index=18&type=chunk) [Consolidated Statements of Cash Flows](index=8&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Cash Flow Summary (in thousands) | Cash Flow Activity (Nine Months Ended Sep 30) | 2023 | 2022 | | :--- | :--- | :--- | | Net Cash Provided by Operating Activities | $38,483 | $80,369 | | Net Cash Used in Investing Activities | ($168,277) | ($734,430) | | Net Cash Provided by Financing Activities | $167,109 | $586,084 | | **Net Change in Cash and Cash Equivalents** | **$37,315** | **($67,977)** | [Notes to Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) - The Company adopted the CECL accounting standard on January 1, 2023, resulting in a net decrease to retained earnings of **$3.9 million**[56](index=56&type=chunk)[64](index=64&type=chunk) - The securities available for sale portfolio had a fair value of **$553.1 million** and gross unrealized losses of **$63.3 million** as of September 30, 2023, which management attributes to interest rate changes[74](index=74&type=chunk)[79](index=79&type=chunk) - Total gross loans were **$3.72 billion** as of September 30, 2023, with an Allowance for Credit Losses (ACL) of **$50.6 million**, representing **1.36%** of total gross loans[85](index=85&type=chunk)[166](index=166&type=chunk) - The Company and the Bank met all regulatory capital requirements, with a consolidated Total Risk-based Capital ratio of **13.88%** as of September 30, 2023[202](index=202&type=chunk)[206](index=206&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=39&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses decreased net income and margin compression due to higher funding costs, alongside strong loan and asset growth [Operating Results Overview](index=43&type=section&id=Operating%20Results%20Overview) Key Performance Metrics (in thousands, except per share) | Metric (in thousands, except per share) | Q3 2023 | Q3 2022 | YTD 2023 | YTD 2022 | | :--- | :--- | :--- | :--- | :--- | | Net Income | $9,629 | $14,513 | $31,087 | $39,657 | | Diluted EPS | $0.30 | $0.47 | $0.99 | $1.27 | | Net Interest Income | $25,421 | $34,095 | $79,860 | $96,805 | - The net interest margin (tax-equivalent) declined to **2.32%** in Q3 2023 from **3.53%** in Q3 2022, primarily due to higher funding costs in the rising interest rate environment[286](index=286&type=chunk) - Noninterest expense increased to **$15.4 million** in Q3 2023 from **$14.2 million** in Q3 2022, mainly due to higher FDIC insurance assessments and derivative collateral fees[135](index=135&type=chunk) [Financial Condition](index=54&type=section&id=Financial%20Condition) - Total assets grew to **$4.56 billion** at September 30, 2023, a **4.9%** increase from December 31, 2022, driven by strong organic loan growth[144](index=144&type=chunk) - Total gross loans reached **$3.72 billion** at September 30, 2023, a **4.3%** increase from year-end 2022, with growth moderated by active balance sheet management[145](index=145&type=chunk) - Total deposits increased by **7.6%** to **$3.68 billion** from year-end 2022, supported by inflows of core deposits and supplemental funding from brokered deposits[363](index=363&type=chunk)[364](index=364&type=chunk) [Asset Quality](index=57&type=section&id=Asset%20Quality) - Asset quality remained strong, with nonperforming loans at **$749,000**, representing just **0.02%** of total loans as of September 30, 2023[332](index=332&type=chunk)[333](index=333&type=chunk) - The allowance for credit losses on loans was **$50.6 million**, or **1.36%** of total loans, at September 30, 2023, compared to **$48.0 million**, or **1.34%**, at year-end 2022[360](index=360&type=chunk) [Liquidity and Capital Resources](index=64&type=section&id=Liquidity%20and%20Capital%20Resources) - The company maintained a strong liquidity position with total on- and off-balance sheet liquidity of **$2.18 billion** as of September 30, 2023, without utilizing the BTFP or Discount Window[354](index=354&type=chunk) - Total shareholders' equity increased to **$416.0 million** at September 30, 2023, from **$394.1 million** at year-end 2022, driven by retained earnings[371](index=371&type=chunk) - The company and the Bank remained well-capitalized, with all regulatory capital ratios exceeding minimum requirements, including a consolidated Tier 1 Leverage Ratio of **9.62%**[348](index=348&type=chunk)[350](index=350&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=67&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company manages its primary market risk, interest rate risk, using NII simulation models and hedging instruments - The company's main market risk is interest rate risk, managed through strategies overseen by its Asset Liability Management (ALM) Committee[404](index=404&type=chunk)[387](index=387&type=chunk) - To mitigate interest rate exposure, the company utilizes cash flow hedges, including interest rate swaps and caps, with a total notional amount of **$308.0 million** at September 30, 2023[390](index=390&type=chunk) Net Interest Income (NII) Sensitivity Analysis | Interest Rate Change (bps) | Forecasted NII Change (12-Month) | | :--- | :--- | | +400 | (1.69)% | | +200 | (1.14)% | | 0 | 0.00% | | -100 | +2.45% | | -300 | +7.23% | [Controls and Procedures](index=69&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective, with no material changes to internal controls - The Chief Executive Officer and Chief Financial Officer concluded that the company's disclosure controls and procedures were effective as of September 30, 2023[324](index=324&type=chunk) - No changes in internal control over financial reporting occurred during the quarter that materially affected, or are reasonably likely to materially affect, the company's internal controls[325](index=325&type=chunk) [PART II OTHER INFORMATION](index=70&type=section&id=PART%20II%20OTHER%20INFORMATION) This part covers legal proceedings, risk factors, equity securities transactions, and other required disclosures [Legal Proceedings](index=70&type=section&id=Item%201.%20Legal%20Proceedings) The company is not party to any material pending legal proceedings outside of ordinary business litigation - The company reports no material pending legal proceedings outside of ordinary routine litigation[327](index=327&type=chunk) [Risk Factors](index=70&type=section&id=Item%201A.%20Risk%20Factors) No material changes to previously disclosed risk factors were reported for the period - No material changes to the risk factors disclosed in the company's 2022 Form 10-K were reported[328](index=328&type=chunk) [Unregistered Sales of Equity Securities, Use of Proceeds, and Issuer Purchases of Equity Securities](index=70&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%2C%20Use%20of%20Proceeds%2C%20and%20Issuer%20Purchases%20of%20Equity%20Securities) The company did not repurchase shares under its authorized program during the third quarter of 2023 - The company has a board-approved stock repurchase program authorizing up to **$25.0 million** of its common stock, which expires on August 16, 2024[306](index=306&type=chunk) - During the third quarter of 2023, no shares were repurchased under the publicly announced plan, though **1,078 shares** were withheld for tax purposes related to vesting of restricted stock[308](index=308&type=chunk) [Defaults Upon Senior Securities](index=71&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) No defaults upon senior securities were reported during the period - None reported[312](index=312&type=chunk) [Mine Safety Disclosures](index=71&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This disclosure requirement is not applicable to the company's operations - Not applicable[313](index=313&type=chunk) [Other Information](index=71&type=section&id=Item%205.%20Other%20Information) No directors or executive officers adopted or terminated Rule 10b5-1 trading plans during the quarter - No directors or executive officers adopted or terminated any Rule 10b5-1 trading plans during the third quarter of 2023[314](index=314&type=chunk) [Exhibits](index=71&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the report, including Sarbanes-Oxley certifications and XBRL data - The report includes certifications from the CEO and CFO as required by the Sarbanes-Oxley Act, as well as financial statements formatted in inline XBRL[315](index=315&type=chunk)

Bridgewater Bancshares, Inc. (NASDAQ:BWB) Q3 2023 Earnings Conference Call October 26, 2023 9:00 AM ET Company Participants Justin Horstman - Director of Investor Relations Jerry Baack - Chairman, President and Chief Executive Officer Joe Chybowski - Chief Financial Officer Jeff Shellberg - Executive Vice President and Chief Credit Officer Nick Place - Chief Lending Officer Conference Call Participants Jeffrey Rulis - D.A. Davidson Operator Good morning, and welcome to the Bridgewater Bancshares 2023 Third ...

PART I FINANCIAL INFORMATION [Consolidated Financial Statements (unaudited)](index=3&type=section&id=Item%201.%20Consolidated%20Financial%20Statements%20(unaudited)) This section presents the unaudited consolidated financial statements for Bridgewater Bancshares, Inc. as of June 30, 2023, including balance sheets, income, comprehensive income, shareholders' equity, and cash flows, with notes [Consolidated Balance Sheets](index=3&type=section&id=Consolidated%20Balance%20Sheets) This section provides a snapshot of the company's financial position, detailing assets, liabilities, and shareholders' equity at specific dates Consolidated Balance Sheet Highlights (Unaudited) | (dollars in thousands) | June 30, 2023 | December 31, 2022 | | :--- | :--- | :--- | | **Total Assets** | **$4,603,185** | **$4,345,662** | | Loans, Net | $3,677,792 | $3,512,157 | | Securities Available for Sale | $538,220 | $548,613 | | Cash and Cash Equivalents | $177,101 | $87,043 | | **Total Liabilities** | **$4,194,059** | **$3,951,598** | | Total Deposits | $3,577,932 | $3,416,543 | | FHLB Advances | $262,000 | $97,000 | | **Total Shareholders' Equity** | **$409,126** | **$394,064** | [Consolidated Statements of Income](index=4&type=section&id=Consolidated%20Statements%20of%20Income) This section outlines the company's financial performance over periods, showing revenues, expenses, and net income Consolidated Statements of Income Highlights (Unaudited) | (dollars in thousands) | Three Months Ended June 30, 2023 | Three Months Ended June 30, 2022 | Six Months Ended June 30, 2023 | Six Months Ended June 30, 2022 | | :--- | :--- | :--- | :--- | :--- | | Net Interest Income | $25,872 | $32,530 | $54,439 | $62,710 | | Provision for Credit Losses | $50 | $3,025 | $675 | $4,700 | | Noninterest Income | $1,415 | $1,650 | $3,358 | $3,207 | | Noninterest Expense | $14,388 | $13,752 | $28,571 | $27,260 | | **Net Income** | **$9,816** | **$12,882** | **$21,458** | **$25,144** | | **Diluted EPS** | **$0.31** | **$0.41** | **$0.69** | **$0.80** | [Consolidated Statements of Comprehensive Income](index=5&type=section&id=Consolidated%20Statements%20of%20Comprehensive%20Income) This section presents net income and other comprehensive income items, reflecting changes in equity from non-owner sources Consolidated Statements of Comprehensive Income (Unaudited) | (dollars in thousands) | Three Months Ended June 30, 2023 | Three Months Ended June 30, 2022 | Six Months Ended June 30, 2023 | Six Months Ended June 30, 2022 | | :--- | :--- | :--- | :--- | :--- | | Net Income | $9,816 | $12,882 | $21,458 | $25,144 | | Total Other Comprehensive Loss, Net of Tax | ($3,012) | ($9,354) | ($2,966) | ($20,067) | | **Comprehensive Income** | **$6,804** | **$3,528** | **$18,492** | **$5,077** | [Consolidated Statements of Shareholders' Equity](index=6&type=section&id=Consolidated%20Statements%20of%20Shareholders'%20Equity) This section details changes in the company's equity accounts, including net income, dividends, and other comprehensive income - Total Shareholders' Equity increased from **$394.1 million** at December 31, 2022, to **$409.1 million** at June 30, 2023. The change was driven by net income of **$21.5 million**, partially offset by a **$3.9 million** cumulative effect of adopting a new accounting principle (CECL), **$2.0 million** in preferred stock dividends, and a **$3.0 million** increase in accumulated other comprehensive loss[46](index=46&type=chunk) [Consolidated Statements of Cash Flows](index=8&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) This section summarizes the cash inflows and outflows from operating, investing, and financing activities over specific periods Consolidated Statements of Cash Flows Highlights (Unaudited) | (dollars in thousands) | Six Months Ended June 30, 2023 | Six Months Ended June 30, 2022 | | :--- | :--- | :--- | | Net Cash Provided by Operating Activities | $22,716 | $71,226 | | Net Cash Used in Investing Activities | ($165,624) | ($485,751) | | Net Cash Provided by Financing Activities | $232,966 | $344,569 | | **Net Change in Cash and Cash Equivalents** | **$90,058** | **($69,956)** | [Notes to Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) This section provides detailed explanations of the accounting policies, significant transactions, and financial instrument details supporting the financial statements - On January 1, 2023, the Company adopted the Current Expected Credit Loss (CECL) methodology. This resulted in a net decrease to retained earnings of **$3.9 million**, primarily due to establishing a **$4.8 million** allowance for off-balance sheet credit exposures and a **$650,000** increase in the allowance for credit losses on loans, partially offset by a deferred tax impact[93](index=93&type=chunk)[94](index=94&type=chunk) Impact of Adopting CECL on January 1, 2023 | (dollars in thousands) | Pre-CECL Balance | CECL Adoption Impact | Post-CECL Balance | | :--- | :--- | :--- | :--- | | Allowance for Credit Losses on Loans | $47,996 | $650 | $48,646 | | Allowance for Credit Losses on Off-balance Sheet Credit Exposures | $360 | $4,850 | $5,210 | [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=56&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the financial condition and results of operations, highlighting net income decrease due to net interest margin compression, strong loan growth, and robust asset quality [Operating Results Overview](index=65&type=section&id=Operating%20Results%20Overview) This section provides a summary of key financial performance metrics over recent quarters, offering a quick glance at trends Selected Quarterly Financial Data | (dollars in thousands, except per share data) | Q2 2023 | Q1 2023 | Q4 2022 | Q3 2022 | Q2 2022 | | :--- | :--- | :--- | :--- | :--- | :--- | | Net Interest Income | $25,872 | $28,567 | $32,893 | $34,095 | $32,530 | | Net Income | $9,816 | $11,642 | $13,735 | $14,513 | $12,882 | | Diluted EPS | $0.31 | $0.37 | $0.45 | $0.47 | $0.41 | | Total Assets | $4,603,185 | $4,602,899 | $4,345,662 | $4,128,987 | $3,883,264 | | Total Loans, Gross | $3,736,211 | $3,684,360 | $3,569,446 | $3,380,082 | $3,225,885 | [Discussion and Analysis of Results of Operations](index=67&type=section&id=Discussion%20and%20Analysis%20of%20Results%20of%20Operations) This section analyzes the factors influencing the company's financial performance, including net interest income, credit losses, and noninterest expenses - Net income for Q2 2023 was **$9.8 million** (**$0.31** per diluted share), a decrease from **$12.9 million** (**$0.41** per diluted share) in Q2 2022. The decline was primarily driven by a **118 basis point** decrease in net interest margin to **2.40%**, as higher funding costs outpaced the increase in earning asset yields[290](index=290&type=chunk)[307](index=307&type=chunk) Rate/Volume Analysis of Net Interest Income (Q2 2023 vs Q2 2022) | (dollars in thousands) | Change Due to Volume | Change Due to Rate | Total Variance | | :--- | :--- | :--- | :--- | | **Total Interest Earning Assets** | **$9,245** | **$8,106** | **$17,351** | | **Total Interest Bearing Liabilities** | **$7,880** | **$15,997** | **$23,877** | | **Net Interest Income** | **$1,365** | **($7,891)** | **($6,526)** | - The provision for credit losses on loans was significantly lower at **$550,000** for Q2 2023, compared to **$3.0 million** for Q2 2022, primarily reflecting continued strong credit quality alongside portfolio growth[347](index=347&type=chunk) - Noninterest expense increased by **$636,000** year-over-year to **$14.4 million** in Q2 2023, mainly due to higher FDIC insurance assessments and derivative collateral fees[335](index=335&type=chunk) [Financial Condition](index=82&type=section&id=Financial%20Condition) This section details the company's financial position, including asset growth, loan portfolio quality, deposit trends, and capital adequacy - Total assets grew to **$4.60 billion** at June 30, 2023, a **5.9%** increase from year-end 2022, driven by strong loan growth. Total gross loans increased by **$166.8 million** (**4.7%**) during the same period to **$3.74 billion**[354](index=354&type=chunk)[355](index=355&type=chunk) - Asset quality remains exceptionally strong, with nonperforming loans at **$662,000**, representing just **0.02%** of total loans at June 30, 2023[377](index=377&type=chunk)[378](index=378&type=chunk) - Total deposits increased by **$161.4 million** (**4.7%**) since year-end 2022 to **$3.58 billion**. The company increased its use of brokered deposits, which grew by **$198.7 million** to **$974.8 million**, representing **27.2%** of total deposits[409](index=409&type=chunk)[398](index=398&type=chunk) - The company's capital ratios remain well above regulatory minimums. As of June 30, 2023, the consolidated Total Risk-based Capital Ratio was **13.50%** and the Tier 1 Leverage Ratio was **9.47%**[407](index=407&type=chunk)[415](index=415&type=chunk) [Liquidity](index=99&type=section&id=Liquidity) This section assesses the company's ability to meet its short-term obligations, detailing primary and secondary liquidity sources Liquidity Position Summary | (dollars in thousands) | June 30, 2023 | December 31, 2022 | | :--- | :--- | :--- | | **Total Primary Liquidity** | **$440,632** | **$596,703** | | (Cash & Unpledged Securities) | | | | **Total Secondary Liquidity** | **$1,521,686** | **$782,975** | | (Borrowing Capacity) | | | | **Total Primary and Secondary Liquidity** | **$1,962,318** | **$1,379,678** | - Total on- and off-balance sheet liquidity significantly increased to **$1.96 billion** as of June 30, 2023, from **$1.38 billion** at year-end 2022, primarily due to an **$828.8 million** increase in borrowing capacity with the Federal Reserve Bank[435](index=435&type=chunk)[417](index=417&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=103&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risk is interest rate risk, managed by the ALM Committee, with simulations showing asset-sensitivity in falling rates and liability-sensitivity in rising rates Net Interest Income Sensitivity Analysis (12-Month Projection) | Change in Interest Rates (bps) | Forecasted NII Change from Base (as of June 30, 2023) | | :--- | :--- | | +400 | (7.68)% | | +300 | (5.74)% | | +200 | (3.80)% | | +100 | (1.89)% | | 0 (Base) | — | | -100 | 4.01% | | -200 | 7.50% | | -300 | 11.22% | - The company utilizes cash flow hedges, including interest rate swaps and caps, to manage interest rate exposure for its brokered deposit and wholesale borrowing portfolios. As of June 30, 2023, these hedges had a total notional amount of **$308.0 million**[444](index=444&type=chunk) [Controls and Procedures](index=106&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that the company's disclosure controls and procedures were effective as of June 30, 2023, with no material changes to internal control over financial reporting - The CEO and CFO concluded that as of June 30, 2023, the company's disclosure controls and procedures were effective[459](index=459&type=chunk) - There were no material changes in the company's internal control over financial reporting during the quarter[447](index=447&type=chunk) PART II OTHER INFORMATION [Legal Proceedings](index=108&type=section&id=Item%201.%20Legal%20Proceedings) The company is not involved in any material pending legal proceedings beyond routine litigation incidental to its business - The Company and its subsidiaries are not subject to any material pending legal proceedings outside of ordinary routine litigation[467](index=467&type=chunk) [Risk Factors](index=108&type=section&id=Item%201A.%20Risk%20Factors) No material changes have occurred to the risk factors previously disclosed in the company's Annual Report on Form 10-K for the year ended December 31, 2022 - No material changes have occurred to the risk factors disclosed in the Company's Annual Report on Form 10-K filed on March 7, 2023[448](index=448&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=108&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company did not repurchase shares under its publicly announced program in Q2 2023, but withheld shares for tax purposes, with a $25.0 million repurchase program remaining available Issuer Purchases of Equity Securities (Q2 2023) | Period | Total Shares Purchased | Average Price Paid Per Share | Shares Purchased as Part of Publicly Announced Program | | :--- | :--- | :--- | :--- | | April 2023 | 513 | $10.84 | 0 | | May 2023 | 0 | N/A | 0 | | June 2023 | 350 | $9.11 | 0 | | **Total** | **863** | **$10.14** | **0** | - The company's stock repurchase program, authorizing up to **$25.0 million** in repurchases, remains fully available as of June 30, 2023, and is set to expire on August 16, 2024[461](index=461&type=chunk) [Other Items (Items 3, 4, 5, 6)](index=109&type=section&id=Other%20Items%20(Items%203,%204,%205,%206)) This section covers remaining disclosures, including no defaults on senior securities, the CEO's termination of a Rule 10b5-1 trading plan, and a list of filed exhibits - On May 15, 2023, Chairman, CEO, and President Jerry Baack terminated a Rule 10b5-1 trading arrangement that was originally adopted on December 14, 2021[470](index=470&type=chunk) - There were no defaults upon senior securities, and mine safety disclosures are not applicable[463](index=463&type=chunk)[278](index=278&type=chunk)

Bridgewater Bancshares, Inc. (NASDAQ:BWB) Q2 2023 Earnings Conference Call July 27, 2023 9:00 AM ET Company Participants Justin Horstman - Director, Investor Relations Jerry Baack - Chairman, President and Chief Executive Officer Joe Chybowski - Chief Financial Officer Nick Place - Chief Lending Officer Jeff Shellberg - Director, Secretary, Executive Vice President and Chief Credit Officer Conference Call Participants Brendan Nosal - Piper Sandler Jeff Rulis - D.A. Davidson Ben Gerlinger - the Hovde Group O ...