ConnectOne Bancorp, Inc. (NASDAQ:CNOB) Q4 2021 Earnings Conference Call January 27, 2022 10:00 AM ET Company Participants Frank Sorrentino – Chairman and Chief Executive Officer Bill Burns – Executive Vice President and Chief Financial Officer Siya Vansia – Vice President of Marketing Conference Call Participants Frank Schiraldi – Piper Sandler David Bishop – Seaport Research Matthew Breese – Stephens Inc. William Wallace – Raymond James Michael Perito – KBW Operator Greetings and welcome to ConnectOne Banc ...

[Part I – Financial Information](index=4&type=section&id=PART%20I%20%E2%80%93%20FINANCIAL%20INFORMATION) [Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements) The unaudited consolidated financial statements detail the company's financial position, operations, and cash flows, highlighting total asset growth to **$7.95 billion** and a significant increase in nine-month net income to **$97.3 million**, influenced by **CECL adoption** Consolidated Statement of Condition Highlights | (in thousands) | September 30, 2021 (unaudited) | December 31, 2020 | | :--- | :--- | :--- | | **Total Assets** | **$7,949,514** | **$7,547,339** | | Net Loans Receivable | $6,498,453 | $6,157,081 | | **Total Liabilities** | **$6,851,081** | **$6,632,029** | | Total Deposits | $6,398,338 | $5,959,224 | | **Total Stockholders' Equity** | **$1,098,433** | **$915,310** | Consolidated Income Statement Highlights | (in thousands, except per share data) | Nine Months Ended Sep 30, 2021 | Nine Months Ended Sep 30, 2020 | | :--- | :--- | :--- | | Net Interest Income | $192,417 | $176,620 | | Provision for (reversal of) credit losses | $(6,315) | $36,000 | | **Net Income** | **$97,315** | **$45,648** | | **Diluted EPS** | **$2.43** | **$1.15** | Consolidated Statement of Cash Flows Highlights | (in thousands) | Nine Months Ended Sep 30, 2021 | Nine Months Ended Sep 30, 2020 | | :--- | :--- | :--- | | Net cash provided by operating activities | $154,644 | $99,756 | | Net cash used in investing activities | $(352,696) | $(312,151) | | Net cash provided by financing activities | $307,509 | $267,231 | | **Net change in cash and cash equivalents** | **$109,439** | **$54,636** | - Effective January 1, 2021, the Company adopted the CECL standard, resulting in a total pre-tax increase to the Allowance for Credit Losses (ACL) of **$9.4 million** and a net decrease to retained earnings of **$2.9 million** after tax effects[37](index=37&type=chunk) [Notes to Consolidated Financial Statements](index=15&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements%20(unaudited)) The notes detail the basis of financial statement preparation, including **CECL adoption**, the **$462.9 million investment securities portfolio**, the **$6.6 billion loan portfolio** with its **$78.0 million allowance for credit losses**, and the issuance of **$115 million** in new perpetual preferred stock - The company operates as a community-based, full-service commercial bank headquartered in Englewood Cliffs, New Jersey, with its business primarily consisting of its wholly-owned subsidiary, ConnectOne Bank[32](index=32&type=chunk) - The COVID-19 pandemic continues to pose risks to the company's financial condition, with potential material adverse impacts on estimates for the allowance for credit losses, fair value of financial instruments, and goodwill[35](index=35&type=chunk) Loan Portfolio Composition (Sep 30, 2021) | Loan Type | Amount (in thousands) | | :--- | :--- | | Commercial | $1,325,488 | | Commercial real estate | $4,436,626 | | Commercial construction | $552,896 | | Residential real estate | $270,793 | | Consumer | $2,093 | | **Total Gross Loans** | **$6,587,896** | Allowance for Credit Losses (ACL) Roll-Forward (Nine Months Ended Sep 30, 2021) | (in thousands) | Amount | | :--- | :--- | | **Balance at Dec 31, 2020** | **$79,226** | | Day 1 effect of CECL | $6,557 | | **Adjusted Balance at Jan 1, 2021** | **$85,783** | | Net Charge-offs | $(1,751) | | (Reversal of) provision for credit losses - loans | $(6,046) | | **Balance at Sep 30, 2021** | **$77,986** | - In August 2021, the company issued 115,000 shares of 5.25% Fixed-Rate Non-Cumulative Perpetual Preferred Stock, Series A, for net proceeds of **$110.9 million**[177](index=177&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=55&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management attributes strong Q3 2021 performance to higher net interest income and decreased credit loss provisions, with net income reaching **$32.1 million** and net interest margin widening to **3.73%**, while total loans grew by **$340.2 million** and asset quality remained stable Q3 2021 vs Q3 2020 Performance | Metric | Q3 2021 | Q3 2020 | | :--- | :--- | :--- | | Net Income | $32.1 million | $24.8 million | | Diluted EPS | $0.80 | $0.62 | | Net Interest Income | $68.2 million | $60.5 million | | Provision for Credit Losses | $1.1 million | $5.0 million | - The increase in net income for the first nine months of 2021 was primarily due to a **$15.8 million** increase in net interest income and a **$42.3 million** decrease in the provision for credit losses compared to the same period in 2020[196](index=196&type=chunk) - The fully taxable equivalent net interest margin widened to **3.73%** in Q3 2021 from **3.49%** in Q3 2020, driven by a **60 basis-point** reduction in the cost of interest-bearing liabilities[198](index=198&type=chunk) - As of September 30, 2021, the company held **$177.8 million** in PPP loans, down from **$397.5 million** at year-end 2020, with remaining deferred fees of **$6.0 million** expected to be recognized by the end of 2022[193](index=193&type=chunk)[75](index=75&type=chunk) Asset Quality Metrics | Metric | Sep 30, 2021 | Dec 31, 2020 | | :--- | :--- | :--- | | Nonperforming assets to total assets | 0.83% | 0.82% | | Nonaccrual loans to total loans | 1.00% | 0.99% | | ACL to total loans | 1.19% | 1.27% | | ACL to total loans (ex-PPP) | 1.22% | 1.36% | - Stockholders' equity increased by **$183.1 million** since year-end 2020 to **$1.1 billion**, largely due to **$110.9 million** net proceeds from a preferred stock issuance and **$82.0 million** in retained earnings growth[254](index=254&type=chunk) [Qualitative and Quantitative Disclosures about Market Risks](index=71&type=section&id=Item%203.%20Qualitative%20and%20Quantitative%20Disclosures%20about%20Market%20Risks) The company manages primary interest rate risk through **ALCO** using **NII simulation** and **EVE models**, with sensitivity analysis showing a **+200 bps rate increase** would boost one-year NII by **3.23%** and a **-100 bps decrease** would lower it by **5.80%**, while EVE would decline by **0.61%** and **1.30%** respectively, all within guidelines One-Year Net Interest Income (NII) Sensitivity (as of Sep 30, 2021) | Interest Rate Shock (bps) | Estimated Change in NII (%) | | :--- | :--- | | +200 | +3.23% | | +100 | +1.57% | | -100 | -5.80% | Economic Value of Equity (EVE) Sensitivity (as of Sep 30, 2021) | Interest Rate Shock (bps) | Estimated Change in EVE (%) | | :--- | :--- | | +200 | -0.61% | | +100 | -0.07% | | -100 | -1.30% | [Controls and Procedures](index=71&type=section&id=Item%204.%20Controls%20and%20Procedures) The CEO and CFO concluded that the company's disclosure controls and procedures were effective as of September 30, 2021, with no material changes to internal controls over financial reporting during the quarter - The CEO and CFO concluded that the company's disclosure controls and procedures are effective in ensuring timely and accurate reporting as required by the SEC[265](index=265&type=chunk) - No material changes to the company's internal controls over financial reporting occurred during the last fiscal quarter[266](index=266&type=chunk) [Part II – Other Information](index=72&type=section&id=PART%20II%20%E2%80%93%20OTHER%20INFORMATION) [Legal Proceedings](index=72&type=section&id=Item%201.%20Legal%20Proceedings) The company is not subject to any legal proceedings that could materially adversely impact its operations or financial condition - The Company is not currently subject to any material legal proceedings[268](index=268&type=chunk) [Risk Factors](index=72&type=section&id=Item%201a.%20Risk%20Factors) No material changes have occurred in the company's risk factors since the Annual Report on Form 10-K for the year ended December 31, 2020 - No material changes have occurred in the risk factors since the last Annual Report on Form 10-K for the year ended December 31, 2020[269](index=269&type=chunk) [Exhibits](index=73&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the Form 10-Q, including documents related to the **Series A Preferred Stock** and **CEO/CFO certifications** under the Sarbanes-Oxley Act of 2002 - Exhibits filed include documents related to the new Series A Preferred Stock (Certificate of Amendment, Specimen Certificate, Deposit Agreement)[271](index=271&type=chunk) - Certifications by the Chief Executive Officer and Chief Financial Officer pursuant to Sections 302 and 906 of the Sarbanes-Oxley Act of 2002 are included as exhibits[271](index=271&type=chunk)

Financial Data and Key Metrics Changes - The company reported a return on assets of 1.62% and a return on tangible common equity of 16.9% [8] - Pre-provision net revenue increased to 2.23% of average assets, with quarterly sequential annualized loan growth net of PPP at 21% [8][21] - The quarterly cash dividend was raised to $0.13, an 18% increase from the last quarter and a 44% increase from a year ago [10] Business Line Data and Key Metrics Changes - Non-interest revenue sources showed positive momentum, particularly in the SBA platform and commercial real estate loans [11] - The FinTech subsidiary, BoeFly, is generating more traffic and scaling its competitive position [12] Market Data and Key Metrics Changes - The company has about $100 million in footings in Florida, indicating growth potential in that market [36] - The New York Metro economy is rebounding, providing opportunities for proactive growth [8] Company Strategy and Development Direction - The company is focused on enhancing its competitive position in New York and expanding into South Florida [13][14] - There is a strategic emphasis on organic growth while maintaining strong credit standards and margin discipline [9][60] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to navigate potential economic slowdowns and interest rate changes [46][48] - The outlook for loan growth in 2022 is projected at approximately 10%, with expectations of some headwinds [30][49] Other Important Information - Operating expenses increased by 7% sequentially, primarily due to hiring and investments in infrastructure [26] - The efficiency ratio remained below 40%, indicating strong operational capabilities [26] Q&A Session Summary Question: What are the plans for the Florida team and office? - The company has about $100 million in footings in Florida and plans to open a full-service office there [36] Question: How does the company view growth in Florida compared to the Northeast? - Management sees Florida as a growing market due to favorable tax status and demographic trends, with potential for significant growth [38][70] Question: What is the outlook for loan growth next year? - The company expects loan growth to be around 10%, with a disciplined approach to maintaining credit quality and margins [49][60] Question: What is the status of the buyback program? - The buyback program is seen as opportunistic, depending on growth and share price [41] Question: How is the company managing credit quality in the Metro New York area? - Management acknowledged some isolated credit issues but emphasized strong overall credit quality and proactive management [53] Question: What is the outlook for multifamily lending? - The multifamily market remains strong, but management is cautious about potential overheating and rising interest rates [78]

Table of Contents UNITED STATES OF AMERICA SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarterly Period Ended June 30, 2021 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from __________ to __________ Commission File Number: 000-11486 CONNECTONE BANCORP, INC. (Exact Name of Registrant as Specified in Its ...

ConnectOne Bancorp, Inc. (NASDAQ:CNOB) Q2 2021 Results Conference Call July 29, 2021 10:00 AM ET Company Participants Siya Vansia - Chief Brand and Innovation Officer Frank Sorrentino - Chairman and CEO Bill Burns - Executive Vice President and Chief Financial Officer Conference Call Participants Frank Schiraldi - Piper Sandler David Bishop - Seaport Research Partners Matthew Breese - Stephens Mike Perito - KBW Operator Greetings, and welcome to ConnectOne Bancorp's Second Quarter 2021 Earnings Conference C ...

Table of Contents UNITED STATES OF AMERICA SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarterly Period Ended March 31, 2021 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from __________ to __________ Commission File Number: 000-11486 CONNECTONE BANCORP, INC. (Exact Name of Registrant as Specified in Its ...

ConnectOne Bancorp, Inc. (NASDAQ:CNOB) Q1 2021 Earnings Conference Call April 29, 2021 10:00 AM ET Company Participants Siya Vansia - Chief Brand & Innovation Officer Frank Sorrentino - Chairman & Chief Executive Officer Bill Burns - Executive Vice President & Chief Financial Officer Conference Call Participants Amar Krishnamurti - Raymond James Michael Perito - KBW David Bishop - Seaport Global Securities Zachary Westerlind - Stephens Inc Frank Schiraldi - Piper Sandler Operator Greetings, and welcome to t ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K (Mark One) ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934. For the Fiscal Year Ended December 31, 2020 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934. For the Transition Period from to Commission File Number: 000-11486 ConnectOne Bancorp, Inc. (Exact name of registrant as specified in its charter) New Jersey 52-1273725 (Sta ...

ConnectOne Bancorp, Inc. (NASDAQ:CNOB) Q4 2020 Earnings Conference Call January 28, 2021 10:00 AM ET Company Participants Siya Vansia - VP of Marketing Frank Sorrentino - Chairman, President & CEO Bill Burns - Executive VP & CFO Conference Call Participants Fred Cannon - KBW Frank Schiraldi - Piper Sandler Matthew Breese - Stephens Inc Operator Greetings, and welcome to the ConnectOne Bancorp, Inc. Fourth Quarter 2020 Earnings Call. [Operator Instructions] As a reminder, this conference is being recorded. ...

UNITED STATES OF AMERICA SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarterly Period Ended September 30, 2020 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from __________ to __________ Commission File Number: 000-11486 CONNECTONE BANCORP, INC. (Exact Name of Registrant as Specified in Its Charter) New ...