US Metro Bancorp : 2021 Financial Statements

Consolidated Financial Statements December 31, 2021 and 2020

U.S. Metro Bancorp and Subsidiary

Table of Contents

December 31, 2021 and 2020

Independent Auditor's Report ....................................................................................................................... 1

Consolidated Financial Statements:

Consolidated Balance Sheets ................................................................................................................ 3

Consolidated Statements of Operations ................................................................................................. 4

Consolidated Statements of Comprehensive Income ............................................................................ 5

Consolidated Statements of Changes in Shareholders' Equity .............................................................. 6

Consolidated Statements of Cash Flows ............................................................................................... 7

Notes to Consolidated Financial Statements ......................................................................................... 8

Table of Contents

December 31, 2021 and 2020

Report of Independent Auditors

The Board of Directors and Stockholders

U.S. Metro Bancorp and Subsidiary

Report on the Audit of the Financial Statements

Opinion

We have audited the consolidated financial statements of U.S. Metro Bancorp and Subsidiary, which comprise the consolidated balance sheet as of December 31, 2021 and 2020, and the related consolidated statements of operations, comprehensive income, changes in shareholders' equity, and cash flows for the years then ended, and the related notes to the consolidated financial statements.

In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the financial position of U.S. Metro Bancorp and Subsidiary as of December 31, 2021 and 2020, and the results of their operations and their cash flows for the years then ended in accordance with accounting principles generally accepted in the United States of America.

Basis for Opinion

We conducted our audits in accordance with auditing standards generally accepted in the United States of America (GAAS). Our responsibilities under those standards are further described in the Auditor's

Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of U.S. Metro Bancorp and Subsidiary and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements relating to our audits. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Responsibilities of Management for the Financial Statements

Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with accounting principles generally accepted in the United States of America, and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about U.S. Metro Bancorp and Subsidiary's ability to continue as a going concern within one year after the date that the financial statements are issued.

Auditor's Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with GAAS will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the consolidated financial statements.

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Table of Contents

December 31, 2021 and 2020

In performing an audit in accordance with GAAS, we:

• • Exercise professional judgment and maintain professional skepticism throughout the audit.

• • Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.

• • Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of U.S. Metro Bancorp and Subsidiary's internal control. Accordingly, no such opinion is expressed.

• • Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements.

• • Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about U.S. Metro Bancorp and Subsidiary's ability to continue as a going concern for a reasonable period of time.

We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control-related matters that we identified during the audit.

Los Angeles, California

April 29, 2022

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Consolidated Balance Sheets

At December 31,

2020
ASSETS
Cash and due from banks	$ 11,383,107
Interest-bearing deposits in other banks	152,429,152
Cash and Cash Equivalents	163,812,259
Securities available-for-sale	-
Federal Home Loan Bank stock	2,011,300
Loans held for sale	6,927
Loans:	601,875,978
Deferred loan origination costs, net of deferred fees
and discounts	(7,534,242)
Allowance for loan losses	(9,360,840)
584,980,896
Premises and equipment, net	2,193,446
Deferred tax assets	4,258,102
Servicing assets	2,512,405
Accrued interest receivable and other assets	6,925,070
TOTAL ASSETS	$ 968,418,123	$ 766,700,405
LIABILITIES AND SHAREHOLDERS' EQUITY
LIABILITIES
Deposits:
Noninterest-bearing deposits	$ 300,530,547	$ 191,823,411
Interest-bearing deposits	556,225,963	475,249,493
Total Deposits	856,756,510	667,072,904
FHLB borrowings	-	5,000,000
Subordinated debts, net	25,513,138	25,434,840
Accrued interest payable and other liabilities	9,490,963	6,400,745
TOTAL LIABILITIES	891,760,611	703,908,489
SHAREHOLDERS' EQUITY
Preferred stock - 10,000,000 shares authorized, none
outstanding in 2021 and 2020	-	-
Common stock - 50,000,000 shares authorized, no par value;
51,184,912	51,184,912
issued and outstanding 16,230,000 in 2021 and 2020, respectively
Additional paid in capital	1,988,819	1,956,983
Accumulated other comprehensive loss	(1,059,504)	-
Retained earnings	24,543,285	9,650,021
Total Shareholders' Equity	76,657,512	62,791,916
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY	$ 968,418,123	$ 766,700,405
See Notes to Consolidated Financial Statements	3

2021

$ 8,309,754

108,994,200

117,303,954

69,296,184

2,488,800

2,810,603

778,528,063

(8,745,510) (11,733,859)

Net Loans

758,048,694

1,896,480

6,054,790

3,941,926

6,576,692