First Guaranty Bancshares : 2021 Fourth Quarter Report

A Message to Our Shareholders

Dear Shareholders,

Consolidated Balance Sheets

(in thousands, except share data)

December 31,
2021	2020

Consolidated Statements of Income

(in thousands, except share, per share data & percentages)

Three Months Ended

December 31,

Consolidated Statements of Income

(in thousands, except share, per share data & percentages)

Years End

December 31,

The fourth quarter of 2021 continued First Guaranty Bancshares, Inc. eight consecutive quarters of strong earnings and outstanding performance. With net earnings for the quarter of $8,049,000 ($7,467,000 after preferred stock dividend payments) First Guaranty Bancshares, Inc.'s earnings for the year 2021 totaled $27,297,000, $25,913,000 after payment of preferred stock dividends. Net income for the fourth quarter represented a 31% increase over the fourth quarter of 2020 and a 34% increase for the year 2021 over the year 2020. These strong results were the result of an increase in total interest income year over year of 11% combined with a decrease in total interest expense of approximately 14%.

Asset Quality also increased significantly as the Texas ratio decreased to 6.56% as of December 31, 2021, compared to 11.65% as of December 31, 2020.

The loan portfolio ended the year at $2,159,359,000 compared to $1,844,135,000 as of December 31, 2020. This represents an increase in the loan portfolio of year over year of 17%.

Total shareholders' equity ended the year at $223,889,000 compared to $178,591,000 as of December 31, 2020.

On December 31, 2021, First Guaranty Bancshares, Inc. paid to its shareholders the 114th consecutive quarterly cash dividend. This cash dividend followed a 10% stock dividend which was awarded to all First Guaranty Bancshares, Inc's shareholders on December 17, 2021. The result was a strong cash dividend and a value enhancement to First Guaranty Bancshares, Inc.

While 2021 brought great financial benefit to the shareholders for First Guaranty Bancshares,

Inc., we continued to build and strengthen our Bank system. In the fourth quarter 2021, we were awarded and established loan production and deposit production offices in Vanceburg, Kentucky and Bridgeport, West Virginia. The addition of strong management and loan teams in these areas in November 2021 led to immediate loan production and loan income in these areas. As of December 31, 2021, First Guaranty Bancshares, Inc. had $64,000,000 in loans, from the new areas, booked and earning interest. An additional $81,000,000 are in the pipeline, either approved or in the approval process.

We continue to explore new opportunities for development of and expansion of our branch operations in Texas. With a strong loan pipeline, additional opportunities for reduction of interest expense, and improvements in our processes and procedures, we expect the success of First Guaranty Bancshares, Inc. to continue and to increase. The quality of our efforts have been recognized by Newsweek and Lending Tree as we have been named the Best Small Bank in the United States for the year of 2022 as a follow-up to the same title in 2021.

We will continue to build a strong, fortress balance sheet and we will continue to enhance shareholder value.

Thank you for your continued support.

Sincerely,

Alton B. Lewis

Chief Executive Officer/President

First Guaranty Bancshares, Inc.

NASDAQ Symbol: FGBI

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	(unaudited)
Assets
Cash and cash equivalents:
Cash and due from banks	$261,749		$298,903
Federal funds sold	183		702
Cash and cash equivalents	261,932		299,605
Investment securities:
Available for sale, at fair value	210,620		238,548
Held to maturity, at cost (estimated fair value
of $150,585 and $0, respectively)	153,536		-
Investment securities	364,156		238,548
Federal Home Loan Bank stock, at cost	1,359		3,351
Loans held for sale	-		-
Loans, net of unearned income	2,159,359		1,844,135
Less: allowance for loan losses	24,029		24,518
Net loans	2,135,330		1,819,617
Premises and equipment, net	58,637		58,892
Goodwill	12,900		12,900
Intangible assets, net	5,922		6,587
Other real estate, net	2,072		2,240
Accrued interest receivable	12,047		11,933
Other assets	23,765		18,405
Total Assets	$2,878,120		$2,473,078
Liabilities and Shareholders' Equity
Deposits:
Noninterest-bearing demand	$ 532,578		$ 411,416
Interest-bearing demand	1,275,544		860,394
Savings	201,699		168,879
Time	586,671		725,629
Total deposits	2,596,492		2,166,318
Short-term borrowings	-		50,000
Repurchase agreements	6,439		6,121
Accrued interest payable	4,480		5,292
Long-term advances from Federal Home Loan Bank	3,208		3,366
Senior long-term debt	25,170		42,366
Junior subordinated debentures	14,818		14,777
Other liabilities	3,624		6,247
Total Liabilities	2,654,231		2,294,487
Shareholders' Equity
Preferred Stock, Series A - $1,000 par value
100,000 shares authorized;
non-cumulative perpetual; 34,500 and 0 shares
issued and outstanding, respectively	33,058		-
Common stock - $1 par value
100,600,000 shares authorized
and 10,716,796 shares issued1	10,717		10,717
Surplus	130,093		130,093
Retained earnings	56,654		37,134
Accumulated other comprehensive (loss) income	(6,633)		647
Total Shareholders' Equity	223,889		178,591
Total Liabilities & Shareholders' Equity	$2,878,120		$ 2,473,078

Interest Income:

Loans (including fees)

Deposits with other banks

Securities (including FHLB stock)

Fed Funds Sold

Total Interest Income

Interest Expense:

Demand deposits

Savings deposits

Time deposits

Borrowings

Total Interest Expense

Net Interest Income

Less: Provision for loan losses

Net Interest Income

after Provision for Loan Losses

Noninterest Income:

Service charges, commissions and fees

ATM and debit card fees

Net (losses) gains on securities

Net gains on sale of loans

Other

Total Noninterest Income

Total Business Revenue,

Net of Provision for Loan Losses

Noninterest Expense:

Salaries and employee benefits

Occupancy and equipment expense

Other

Total Noninterest Expense

Income Before Income Taxes

Less: Provision for income taxes

Net Income

Preferred stock dividends

Income Available to Common Shareholders

Per Common Share1:

Earnings

Cash dividends paid

Weighted Average

Common Shares Outstanding1

Return on Average Assets

Return on Average Common Equity

2021 2020

(unaudited)

$27,724 $23,388

10656

2,344 1,309

• 1
  30,174 24,754

2,015 1,444

5258

2,963 3,771

407616

5,437 5,889

24,737 18,865

243 10,251

24,494 8,614

1. 719

1. 789

1. 12,160

1. 80

1. 730

2,774 14,478

27,268 23,092

8,501 7,411

1,935 2,093

6,668 5,918

17,104 15,422

10,164 7,670

2,115 1,543

8,049 6,127

1. -
   $7,467 $6,127

$0.70 $0.57

$0.16 $0.15

10,716,796 10,716,796

1.05% 0.99%

15.51% 13.20%

Interest Income:

Loans (including fees)

Deposits with other banks

Securities (including FHLB stock)

Fed Funds Sold

Total Interest Income

Interest Expense:

Demand deposits

Savings deposits

Time deposits

Borrowings

Total Interest Expense

Net Interest Income

Less: Provision for loan losses

Net Interest Income

after Provision for Loan Losses

Noninterest Income:

Service charges, commissions and fees

ATM and debit card fees

Net gains on securities

Net gains on sale of loans

Other

Total Noninterest Income

Total Business Revenue,

Net of Provision for Loan Losses

Noninterest Expense:

Salaries and employee benefits

Occupancy and equipment expense

Other

Total Noninterest Expense

Income Before Income Taxes

Less: Provision for income taxes

Net Income

Less: Preferred stock dividends

Income Available to Common Shareholders

Per Common Share1:

Earnings

Cash dividends paid

Book Value Per Common Share1

Weighted Average Common Shares Outstanding1

Return on Average Assets

Return on Average Common Equity

2021 2020

(unaudited)

$ 103,353	$ 90,808
316	404
8,248	9,471

• 1
  111,917 100,684

7,237 6,089

204268

12,893 16,908

1,965 2,752

22,299 26,017

89,618 74,667

2,055 14,877

87,563 59,790

2,699 2,571

3,562 3,022

1. 14,791

1. 1,054

2,843 2,342

10,760 23,780

98,323 83,570

32,179 29,600

8,681 7,709

23,008 20,724

63,868 58,033

34,455 25,537

7,158 5,219

27,297 20,318

(1,384)-

$25,913 $20,318

$2.42 $1.90

$0.60 $0.58

$17.81 $16.66

10,716,796 10,716,796

0.96% 0.87%

14.06% 11.36%

Vanessa Drew | [e-mail]

1All share and per share amounts have been restated to reect the ten percent stock dividend paid December 17, 2021 to shareholders of record as of December 15, 2021.

1All share and per share amounts have been restated to reect the ten percent stock dividend paid December 17, 2021 to shareholders of record as of December 15, 2021.

1All share and per share amounts have been restated to reect the ten percent stock dividend paid December 17, 2021 to shareholders of record as of December 15, 2021.

At A Glance

(unaudited)

Bank Officers

Locations ATMs

36 49

Total Assets	Deposits
$2.9Billion	$2.6Billion

Total Loans

$2.2Billion

$8.0Million 4Q 2021 Earnings

$27.3Million YTD 2021 Earnings

114 counting	87
and
Consecutive	Years in
dividends paid	Banking

FIRSTGUARANTY BANCSHARES, INC.

Chairman

Marshall T. Reynolds*

Executive Officers

Alton B. Lewis, Jr.*

President and CEO | Hammond

Eric J. Dosch*

Chief Financial Officer | Hammond

Senior Vice Presidents

Jordan M. Lewis

Texas Area President

Michael R. Mineer

Mideastern Market President

Thomas F. Brothers

Director of Internal Audit

Timothy L. Chesney

Chief Information Officer

Mark J. Ducoing

Chief Deposit Officer

Glenn A. Duhon, Sr.

Ronnie R. Foshee

Director of Lending Development

Kevin J. Foster

Adam J. Johnston

Mikki M. Kelley

Gregory P. Prudhomme

Craig E. Scelfo

Desiree B. Simmons

Chief Administrative Officer

Evan M. Singer

Chief Mergers & Acquisitions Officer

J. Richard Stark

Operations

Randy S. Vicknair

Chief Lending Officer

Christy L. Wells

Matthew B. Wise

Chief Credit Officer

Vice Presidents

Ashley N. Bell

Brenda A. Briscoe

Cheryl Q. Brumfield

Katherine K. Campbell, Controller

Christina M. Carter

Louis J. Cusimano

Vikki W. Dupaquier

Ronald W. Edmonds

Clifton A. Fincher

Denise D. Fletcher

A. Shane Hughes

Shirley P. Jones

JoEllen K. Juhasz, BSA Officer

Michael D. Knighten

Mary T. Mayo

Terrie E. McCartney

Colton C. McDaniel

Jason D. Normand

Steven F. Osman

Scott B. Schilling

Amber L. Smith

Lisa K. Stoker

John A. Synco

Lauryn H. Waits

Melina V. West

Assistant Vice Presidents

Conrad H. Arrambide

Darryl P. Boudreaux

Miranda M. Derveloy

Susan M. Desoto

Michelle A. Dionne

Landa G. Domangue

Vanessa R. Drew

Harrison R. Gill

Ludrick P. Hildago

Leslie A. Hinzman

Donna S. Hodges

Matt P. Hudnall

Keith T. Klein

Daniel L. Loe

Catherine E. Mathes

Pamela R. Normand

Dollie D. Ogletree

Dev M. Patel

Rahul R. Patel

Kristy L. Puckett

Areeb Rashid

Niekitsha S. Ridley

Chanyon O. Robinson

Stacy J. Thompson

Courtney N. Tramiel

Officers

Mandi B. Aguillard

Rebecca G. Brown

Calvin P. Ducote

Jeannette N. Ernst

Kristin M. Williams

PRESORTED FIRST-CLASS MAIL U.S. POSTAGE PAID BATON ROUGE, LA PERMIT NO. 984

2021

4thQuarter

Report

FIRSTGUARANTY BANCSHARES,INC.

Member FDIC

*Officers of First Guaranty Bancshares, Inc. and First Guaranty Bank

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