OptimumBank (OPHC) Emerging Growth Conference 89 summary

Business highlights and growth

• Celebrated 25th anniversary with rapid asset growth, reaching $1.1 billion in total assets as of December 31, 2023.

• Loan-to-deposit ratio slightly over 100%, with $959 million in gross loans and $932 million in deposits.

• Net earnings for the year were $16.6 million, up 27% from the prior year, with diluted EPS of $0.72.

• Q4 was the strongest quarter to date, with net earnings of $4.9 million and EPS of $0.21.

• Net interest margin (NIM) at 4.28%, outperforming peers and expected to rise further.

Loan portfolio and risk management

• Loan book grew nearly 20% in a year, primarily driven by commercial real estate (CRE) lending in South Florida.

• Average loan size is about $5 million, with a lending limit near $35 million.

• CRE portfolio consists mainly of owner-occupied strip malls and smaller deals, not high-risk large buildings.

• Credit risk is mitigated by close relationships with borrowers and a strong local market; no significant loan losses in recent years.

• Consumer loan portfolio is being wound down, reducing exposure to bad debt.

Capital, strategy, and expansion

• Plans to grow capital base through attracting new investors and potential sizable equity raises, but not below book value.

• Geographic expansion focuses on following customer relationships, with Tampa area as a key target.

• 2026 growth strategy includes launching new verticals (factoring, HUD, bridge lending) under the holding company.

• Long-term goal is to mature this strategy by 2027-2028, aiming for larger, sustainable returns.

• Dividend policy under discussion; management open to shareholder input but currently prioritizes capital retention for growth.