Alerus Financial : HMN Financial, Inc. Acquisition

Exhibit [99.2]

ALERUS FINANCIAL CORPORATION TO ACQUIRE HMN FINANCIAL, INC.

MAY 2024

NASDAQ: ALRS

DISCLAIMERS

Special Note Concerning Forward-Looking Statements

This report 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 Alerus Financial Corporation ("Alerus" or "ALRS") and HMN Financial, Inc. ("HMNF") and certain plans, expectations, goals, projections and benefits relating to the merger of HMNF with and into Alerus (the "Merger"), all of which are subject to numerous assumptions, risks and uncertainties. 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. Examples of forward-looking statements include, among others, statements Alerus makes regarding the ability of Alerus and HMNF to complete the transactions contemplated by the Merger Agreement, including the parties' ability to satisfy the conditions to the consummation of the Merger, statements about the expected timing for completing the Merger, the potential effects of the proposed Merger on both Alerus and HMNF, and the possibility of any termination of the Merger Agreement, and any potential downward adjustment in the exchange ratio.

Forward-looking statements are not historical facts but instead express only management's beliefs regarding future results or events, many of which, by their nature, are inherently uncertain and outside of management's control. It is possible that actual results and outcomes may differ, possibly materially, from the anticipated results or outcomes indicated in these forward-looking statements. In addition to factors disclosed in reports filed by Alerus and HMNF with the SEC, risks and uncertainties for Alerus, HMNF and the combined company that may cause actual results or outcomes to differ materially from those anticipated include, but are not limited to: (1) the possibility that any of the anticipated benefits of the proposed Merger will not be realized or will not be realized within the expected time period; (2) the risk that integration of HMNF's operations with those of Alerus will be materially delayed or will be more costly or difficult than expected; (3) the parties' inability to meet expectations regarding the timing of the proposed Merger; (4) changes to tax legislation and their potential effects on the accounting for the Merger; (5) the inability to complete the proposed Merger due to the failure of the Alerus' or HMNF's stockholders to adopt the Merger Agreement, or the failure of Alerus' stockholders to approve the issuance of Alerus' common stock in connection with the Merger; (6) the failure to satisfy other conditions to completion of the proposed Merger, including receipt of required regulatory and other approvals; (7) the failure of the proposed Merger to close for any other reason; (8) diversion of management's attention from ongoing business operations and opportunities due to the proposed Merger; (9) the challenges of integrating and retaining key employees; (10) the effect of the announcement of the proposed Merger on Alerus', HMNF's or the combined company's respective customer and employee relationships and operating results; (11) the possibility that the proposed Merger may be more expensive to complete than anticipated, including as a result of unexpected factors or events; (12) the amount of HMNF's stockholders' equity as of the closing date of the Merger and any potential downward adjustment in the exchange ratio; (13) the dilution caused by Alerus' issuance of additional shares of Alerus' common stock in connection with the Merger; and (14) changes in the global economy and financial market conditions and the business, results of operations and financial condition of Alerus, HMNF and the combined company. Please refer to each of Alerus' and HMNF's Annual Report on Form 10-K for the year ended December 31, 2023, as well as both parties' other filings with the SEC, for a more detailed discussion of risks, uncertainties and factors that could cause actual results to differ from those discussed in the forward-looking statements.

Any forward-looking statement included in this report is based only on information currently available to management and speaks only as of the date on which it is made. Neither Alerus nor HMNF undertakes any 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.

Additional Information and Where to Find It

Alerus will file a registration statement on Form S-4 with the SEC in connection with the proposed transaction. The registration statement will include a joint proxy statement of Alerus and HMNF that also constitutes a prospectus of Alerus, which will be sent to the stockholders of Alerus and HMNF. Before making any voting decision, the stockholders of Alerus and HMNF are advised to read the joint proxy statement/prospectus when it becomes available because it will contain important information about Alerus, HMNF and the proposed transaction. When filed, this document and other documents relating to the Merger filed by Alerus can be obtained free of charge from the SEC's website at www.sec.gov. These documents also can be obtained free of charge by accessing Alerus' website at www.alerus.com under the link "Investors Relations" and then under "SEC Filings" and HMNF's website at www.justcallhome.com/HMNFinancial under "SEC Filings." Alternatively, these documents, when available, can be obtained free of charge from Alerus upon written request to Alerus Financial Corporation, Corporate Secretary, 401 Demers Avenue, Grand Forks, North Dakota 58201 or by calling [phone], or to HMNF, Corporate Secretary, 1016 Civic Center Drive NW, Rochester, Minnesota 55901 or by calling [phone]. The contents of the websites referenced above are not deemed to be incorporated by reference into the registration statement or the joint proxy statement/prospectus.

Participants in the Solicitation

This report does not constitute a solicitation of proxy, an offer to purchase or a solicitation of an offer to sell any securities. Alerus, HMNF, and certain of their directors, executive officers and other members of management and employees may be deemed to be participants in the solicitation of proxies from the stockholders of Alerus and HMNF in connection with the proposed Merger under SEC rules. Information about the directors and executive officers of Alerus and HMNF will be included in the joint proxy statement/prospectus for the proposed transaction filed with the SEC. These documents (when available) may be obtained free of charge in the manner described above under "Additional Information and Where to Find It."

Security holders may obtain information regarding the names, affiliations and interests of Alerus' directors and executive officers in the definitive proxy statement of Alerus relating to its 2024 Annual Meeting of Stockholders filed with the SEC on March 25, 2024 and on Alerus' Annual Report on Form 10-K for the year ended December 31, 2023 filed with the SEC on March 8, 2024. Security holders may also obtain information regarding the names, affiliations and interests of HMNF's directors and executive officers in the definitive proxy statement of HMNF relating to its 2024 Annual Meeting of Stockholders filed with the SEC on March 21, 2024 and HMNF's Annual Report on Form 10-K/A for the year ended December 31, 2023 filed with the SEC on March 19, 2024. To the extent the holdings of Alerus' securities by Alerus' directors and executive officers or the holdings of HMNF securities by HMNF's directors and executive officers have changed since the amounts set forth in Alerus' or HMNF's respective proxy statement for its 2024 Annual Meeting of Stockholders, such changes have been or will be reflected on Statements of Change in Ownership on Form 4 filed with the SEC. These documents can be obtained free of charge in the manner described above under "Additional Information and Where to Find It."

2

	STRATEGIC HIGHLIGHTS
	Natural Expansion of the Alerus Franchise
	▪ Franchise-enhancing strategic expansion into the vibrant Rochester, Minnesota, MSA
	▪ Creation of premier $5B diversified financial institution
STRATEGIC	▪ Continues focus on company-wide core deposit initiatives while providing expansion
EXPANSION	opportunities through new quality markets
	▪ Top 3 pro forma deposit market share in Minnesota among community banks(1)
	▪ Complementary mission and values with a strong corporate and credit culture

FINANCIALLY ATTRACTIVE

• Benefits of additional scale enhances ability to create operating leverage
• • Pro forma total assets of $5.5B, gross loans of $3.7B and deposits of $4.3B
  • Enhances projected 2025 efficiency by 615bps+
• Approximately 45%+ earnings accretion in '25 with a pro forma ROAA of ~1.15%+
• TBVPS earnback of 2.2 years (crossover, inclusive of rate marks)
• Strong pro forma capital ratios; creation of capacity for continued growth
• 25%+ internal rate of return
• Proven ability to create revenue synergies across Alerus' diverse business lines (not modeled)

	▪ High-quality, granular and long tenured loans and core deposit base
	▪ Excellent credit discipline and asset quality
LOW RISK	▪ Seamless integration of straight-forward business lines
	▪ Leverages management's transaction and integration expertise
	▪ Extensive operational and credit due diligence

Source: S&P Capital IQ Pro

3 | (1) Pro forma deposit market share data as of June 30, 2023; community bank defined as banks with less than $10B in total assets

OVERVIEW OF HMN FINANCIAL, INC.

HMN FINANCIAL, INC.

• Headquartered in Rochester, MN
• Nasdaq: HMNF
• Holding company for Home Federal Savings Bank
• 14 branches

COMPANY HIGHLIGHTS

BALANCE SHEET | AS OF 3/31/2024

$1.2B	$872MM	$1.0B	9.4%
Total assets	Gross loans	Total deposits	TCE ratio

PRO FORMA BRANCH MAP

Alerus*

HMNF**

• Map does not include all Alerus branches
• Map does not include Waukesha, WI & Marshalltown, IA branches

Source: S&P Capital IQ Pro

4 | Note: Consolidated financial data as of March 31, 2024

COMPLIMENTARY BUSINESS MODEL

	SMALL BUSINESS
	BANKING
BUSINESS	PRIVATE
BANKING	BANKING

INVESTMENT	COMMERCIAL
SERVICES	REAL ESTATE

FURTHER STRENGTHENS MINNESOTA FRANCHISE

ENTRANCE INTO ATTRACTIVE ROCHESTER MSA

BUILDING UPON A PREMIER MIDWEST FRANCHISE

▪ HMNF provides entrance into the growing

Rochester, MN, MSA, with $592MM deposits (2nd

(1)

ENHANCES DEPOSIT MARKET SHARE(1)

MINNESOTA

(STATE) $2.25B $2.28B $2.29B $2.84B $3.61B

Pro

Forma

in community bank deposit market share)

▪ Bolstering the Minnesota franchise with $874MM

of in-state deposits and placing Alerus at 12th in

the state's deposit market share and top 3 among

community banks(1)

ROCHESTER, MN (MSA)

$0.23B

$0.26B

$0.28B

$1.49B

$0.59B

Pro

Forma

ROCHESTER, MN

MARKET OVERVIEW | ROCHESTER, MN

• With a population of 230,000+ across the MSA, Rochester is a flourishing market and home of the

Mayo Clinic

• In 2023, the Mayo Clinic announced a 6-year, $5B transformation of their Rochester headquarters which will total approximately 2.4 million square feet
• The major expansion, as well as the expected

development from related institutions and industries, serves as a key catalyst for the market's growth for both the near and long-term future

Source: S&P Capital IQ Pro; Mayo Clinic

5 | (1) Pro forma community bank deposit market share ranking as of June 30, 2023; community bank defined as banks with less than $10B in total assets

GRANULAR CORE DEPOSITS

HMNF DEPOSIT PORTFOLIO HIGHLIGHTS

• The strength of the HMNF deposit franchise stems from long- tenured clients and its granular portfolio

COST OF DEPOSITS | LAST 5 QUARTERS

			HMNF	Peers(1)
					2.07%	2.22%
			1.81%	1.89%
	1.52%	1.72%
1.17%	1.44%
1.07%
0.76%
2023Q1	2023Q2	2023Q3		2023Q4	2024Q1

DEPOSIT PORTFOLIO

3/31/2024

Jumbo	Non-interest
Bearing
CDs
22.6%
8.3%

Retail	$1.1B
CDs
16.5%
	IB, MMDA & Savings
	52.7%

GRANULAR CORE DEPOSITS

$964MM	92%			83%	22.6%	27.5%
Core	Core deposits(2) /	Loan / deposit	Non-interest	Uninsured
deposits(2)	total deposits			ratio	bearing deposits	deposits
37,500+ | ~24,000	~$27,000		52%	9
Accounts | Clients		Avg. account		% of deposits held in	Accounts with
		balance		accounts <$250k	balances >$5MM

Source: S&P Capital IQ Pro; HMNF Company files

Note: Bank-level deposit data as of March 31, 2024; percentages may not add up to 100% due to rounding

1. HMNF peers include banks headquartered in the Midwest with between $1.0 billion and $5.0 billion in total assets; peer data shown at the median 6 | (2) Core deposits exclude CDs >$100,000

HIGH QUALITY LOAN PORTFOLIO

HMNF LOAN PORTFOLIO HIGHLIGHTS

• Superior asset quality stems from HMNF granular loans made to high-quality clients in stable markets

ASSET QUALITY | MRQ & LAST 4 YEARS

		NPAs / Total			NCOs / Avg.
		Assets			Loans
0.41%	0.46%					0.34%
	0.20%	0.24%
0.09%	0.04%
		0.01%	0.01%
	-0.11%
2020Y	2021Y	2022Y		2023Y	2024Q1

LOAN PORTFOLIO

3/31/2024

	Home Equity
		1.5%	Consumer
	C&D
	C&I	& Other
	9.3%
	5.0%	5.4%
CRE &	$872MM
Multi-
family			1-4
47.2%		Family
		31.7%

Yield on Loans | 4.96%

LOAN	$872MM	7,000+ | 6,000+	$119K	$144K
PORTFOLIO	Gross	Loans | Clients	Average loan	Average balance
HIGHLIGHTS	loans		balance	by client

Source: S&P Capital IQ Pro; HMNF Company files

7 | Note: Consolidated asset quality data as of March 31, 2024; bank-level loan data as of March 31, 2024; percentages may not add up to 100% due to rounding

LEVERAGING THE HMNF FRANCHISE

GROWING A STRONG FOUNDATION

• High quality, stable client base
• Ability to leverage Alerus' diverse platform:
• • Existing HMNF client base
  • Additional opportunities for growth given strong market demographics

HMNF MEDIAN HOUSEHOLD INCOME(1)

$83,315
	$75,874
HMNF	USA

ROCHESTER, MN

TOP EMPLOYERS

MARKET DEMOGRAPHICS | ROCHESTER, MN (MSA)

	POPULATION GROWTH	PROJ. POPULATION GROWTH	MEDIAN HOUSEHOLD INCOME
230K+	'20 - '24	'24 - '29	2024
1.72%		3.20%		$88,970
2024	1.42%	2.40%
Population						$75,874
	Rochester, MN	USA	Rochester, MN	USA	Rochester, MN	USA

Source: S&P Capital IQ Pro; Rochester Area Economic Development, Inc.

8 | (1) Weighted average median household income by MSA, based on June 30, 2023 deposits

CULTURALLY ALIGNED, COMPLEMENTARY STRENGTHS

HIGH QUALITY DEPOSIT BASE

MRQ Cost of Deposits	2.47%	1.89%
Core Deposits	(1)	90%	92%

BUSINESS MIX

1-4 FAMILY

CRE, C&D & MULTI-FAM

Loan Portfolio		C&I
	CONSUMER & OTHER

20.1%

8.5% 44.7%

26.7%

56.4%

5.0% 6.9%

31.7%

EXCELLENT ASSET

QUALITY

ESOP OWNED

COMPANIES

LTM Fee Income %

NPAs / Total Assets LTM NCOs / Avg. Loans

ESOP Ownership

261%	Pro Forma CRE
Concentration(2)
54.2%	21.3%
0.17%	0.24%
-0.04%	0.04%
5.8%	10.8%

Source: S&P Capital IQ Pro

Note: Financial data as of March 31, 2024; loan and deposit data shown at the bank-level

(1) Core deposits exclude CDs >$100,000

9 | (2) Commercial real estate loans as defined in the regulatory agencies guidance as a percent of total risk-based capital (excludes purchase accounting adjustments)

ENHANCED PROFITABILITY & CAPITAL GENERATION

COMPARISON WITH $1B - $10B PEERS(1)

ROAE (2025E)

TOP QUARTILE

MEDIAN

12.6% 12.3%	10.4%
Pro Forma

FEE INCOME (2025E)

41.7% FormaPro

24.5%	19.4%

LOANS / DEPOSITS (MRQ)

Source: S&P Capital IQ Pro

83.3%	85.3%	89.1%
	Pro Forma

10 |(1) Peers include Midwest major exchange traded banks with between $1B - $10B in total assets as of most recently reported period