Slides
Page 1
SIERRA BANCORP Parent Company for Bank of the Sierra DA DAVIDSON 16TH ANNUAL WESTERN BANK SUMMIT AUGUST 11 – 12 , 2026 -
Page 2
SAFE HARBOR STATEMENT This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on the current beliefs and expectations of Sierra Bancorp’s management and are: • subject to contingencies & uncertainties • not a guarantee of future performance • based on assumptions that may change • not to be unduly relied on Actual results may differ from those set forth in the forward-looking statements. Factors that could cause Sierra Bancorp’s actual results to differ materially from those described in the forward-looking statements include: • changes to current interest rates, including changes to the steepness of current inverted yield curve, and the impact of changes on our earning assets, interest-bearing liabilities, and related net interest income • changes to national and local economies including inflation and the labor market resulting from modifications to trade and fiscal policies, including tariffs and government shut-downs, and other factors • loan portfolio performance including growth, prepayment speeds, yields, and credit quality, including the impact of changes in rates on our customer’s ability to repay • changes to our allowance for credit losses due to economic factors used as key inputs, changes in credit quality, and the impact of other assumptions • changes to the collateral values supporting nonperforming assets that could result in recognition of charge-offs or direct write down of foreclosed assets • changes to statutes, regulations, interpretations or practices • changes or updates to generally accepted accounting principles • liquidity risks, including the ability to effectively manage and retain low interest-bearing accounts in a continued elevated rate environment and the ability to maintain sufficient levels of available borrowing sources and liquid assets • the outcome of any existing or future legal action • the Company’s ability to maintain and grow its core deposits, including uninsured deposits • the Company’s ability to successfully deploy new technology and manage cyber security risks • the Company’s ability to attract and retain skilled employees • the risk to the Company’s operations and ability to serve customers due to the inability of a vendor to meet its service level agreements For more detail on these and other risks, please see Sierra Bancorp’s Annual Report on Form 10-K for the year ended December 31, 2025, and Quarterly Reports on Form 10-Q for the quarterly periods ended September 2025, March 2026, and June 2026 which have been filed with the Securities and Exchange Commission and are available on Sierra Bancorp’s website (https://sierrabancorp.com), and on the Securities and Exchange Commission’s website (www.sec.gov). Sierra Bancorp does not undertake to update any forward-looking statements contained in this document. 2
Page 3
INTRODUCTION
Page 4
SIERRA BANCORP OVERVIEW 34 branches located throughout California’s Central Valley and Central Coast regions Recent Stock Price1: $40.50 Price/TTM Earning1: 11.84x Price/Consensus 2026 Earnings1: 11.38x Price/Tangible Book Value1: 1.55x Most recent quarterly dividend2: $0.27 Dividend Yield1,2: 2.67% Market Capitalization1: $525.0MM 1. Stock data and metrics as of August 7, 2026. 2. Dividend announced on July 24, 2026, payable on August 10, 2026, to shareholders of record as of August 3, 2026. This $0.27 per share dividend this quarter marked the Company’s 110th consecutive quarterly cash dividend and represents a $0.01 increase over the dividend paid in May 2026. Repurchased 1,024,792 shares, or 7%, in 2025 Current Repurchase Plan expires 10/31/2026 4 Bank of the Sierra opened in Porterville, CA in 1978 as a single-branch bank Sierra Bancorp was formed as the holding company for the Bank in 2001 The Company has reached $3.7 billion in assets, with 34 offices Bank of the Sierra maintains its community bank roots providing personal service to small- and medium-sized businesses throughout our footprint, as well as over 95,000 consumer customers Recognized as a top-ranked California bank by Forbes in 2025 KBRA ratings of BBB and BBB+ for senior unsecured debt for Sierra Bancorp and Bank of the Sierra, respectively Mortgage warehouse lender for over twenty years SIERRA BANCORP (NASDAQ: BSRR) CENTRAL CALIFORNIA BASED COMPANY BACKGROUND Repurchased 396,429 shares year-to-date in 2026
Page 5
STRATEGIC OBJECTIVES 5 PEOPLEPROFITABILITY PROCESS & TECHNOLOGY Be a top performing bank with 10% annualized EPS growth Attract and retain the best talent Enhance customer experience across all touchpoints
Page 6
STRATEGIC TACTICS 6 PEOPLEPROFITABILITY PROCESS & TECHNOLOGY Foster a work environment that attracts and retains high-performing individuals Strengthen our One Bank Program, helping each other regardless of our differences, united and working together for a greater purpose Promote a culture of engagement and accountability, which rewards strong performance Enhance succession plans to ensure we have deep talent across the organization Improve training and development programs with a focus on service and sales Utilize compensation plans to align employee interests with those of shareholders Management believes it can achieve 10% EPS growth by utilizing a 5-2-0 model for growth of margin, noninterest income, and noninterest expense, respectively • Expects to improve margin through growth of low-cost deposits and modest loan growth • Seeks low-single digit noninterest income growth primarily through growth of money service business fees and debit card interchange • Intends to remain laser-focused on expense management to maintain our overall cost structure Plans to supplement income growth with dividends and opportunistic share repurchases Expects to selectively complement organic income growth with a compelling strategic acquisition Elevate the customer experience across all touchpoints Expand or improve product offerings tailored to our customer base Align our digital strategy with our overall strategy Continue to enhance loan monitoring and oversight to identify any credit concerns as early as possible Improve operational efficiency across the Bank Streamline our Mortgage Warehouse delivery process to improve efficiency, service, and profitability
Page 7
COMPANY CULTURE Make Every Community We’re a Part of Better Keep Thinking Keep Serving Keep Learning Keep Growing Keep Giving Keep Striving Keep Smiling Anticipate and meet needs with a broad range of solutions Provide quality service on a timely, competitive basis Be passionate about being the right person on the team Encourage creativity and maximize every opportunity to improve Serve our communities through involvement and reinvestment Be disciplined; aim for excellence Enjoy the journey and have fun along the way 7
Page 8
INVESTMENT CONSIDERATIONS
Page 9
Excellent Core Deposit Base • Granular deposit base with approximately 114,000 customer accounts across 34 branches • Anchored by approximately 35% noninterest bearing deposits driving a consistent low cost of deposits • Number one for deposit market share in our headquarters' county 9 INVESTMENT CONSIDERATIONS Strong Fee Income Base Diversified Earning Assets Solid Asset Quality Other Considerations • Debit card interchange is the primary fee source, driven by active use across ~95,000 consumer accounts • Deposit analysis fees from money services businesses in our footprint remain a solid income source • Significant activity-based overdraft charges due to the Bank’s large Central California consumer base • Income from CRA-eligible SBIC investments and bank-owned life insurance compliment fee income • Mortgage Warehouse business line funded with short-term wholesale funding • Focus on serving our local communities and expanding commercial real estate lending • Investment portfolio mix of bonds designed to address interest rate risk while providing a strong source of earnings • Total nonperforming assets declined by $4.3 million, during the first half of 2026, with three relationships comprising 71% of the current overall balance • Stable classified asset trends • Enhanced credit monitoring process with a dedicated portfolio management team • Experienced and talented management team • Strong corporate governance led by our diverse board • Strategic focus of improving shareholder value through enhanced earnings through expense control and earning asset growth, capital management, and long-term growth in tangible book value per share Bank of the Sierra is the preeminent community bank in California’s South-Central Valley
Page 10
INVESTMENT CONSIDERATIONS 5%3%12% EPS ACCRETION DIVIDEND YIELD STOCK REPURCHASE RATE YTD 10 PROACTIVE CAPITAL MANAGEMENT For the six months ended June 30, 2026 (annualized)
Page 11
TANGIBLE COMMON EQUITY $21.73 $18.06 $20.91 $23.15 $25.42 $26.19 9.93% 7.65% 8.36% 9.18% 8.88% 9.19% 8.62% 7.48% 8.05% 8.44% 8.99% 9.08% $- $5.00 $10.00 $15.00 $20.00 $25.00 $30.00 6% 7% 8% 9% 10% 11% 12% 12/31/2021 12/31/2022 12/31/2023 12/31/2024 12/31/2025 6/30/2026 TANGIBLE BOOK VALUE PER SHARE ($) TANGIBLE COMMON EQUITY RATIO Period -End Ratios BSRR - TBV BSRR - TCE National Peer Group - TCE 11Note: Year-to-Date 2026 is through June 30, 2026 for BSRR and through March 31, 2026 for Peer Banks. The National Peer Group (“NPG”) is the median for publicly-traded banks in the U.S. with assets between $500 million and $5 billion.
Page 12
FINANCIAL HIGHLIGHTS AND TRENDS
Page 13
• Diluted earnings per share increased by $0.29, or 20% compared to the same period in 2025. • Return on average assets increased to 1.24% compared to 1.09% for the same period in 2025. • Return on average equity expanded to 12.38% compared to 11.26% for the same period in 2025. 13 FINANCIAL HIGHLIGHTS Solid Capital & Liquidity Low-Cost Deposits Focus on Profitability Strong Financial Metrics • Net interest margin increased 4 basis points to 3.74%, compared to the same period in 2025. • Annualized noninterest income to average assets improved to 1.00% as compared to 0.91% in the same period in 2025. • Efficiency ratio improved to 57.7% as compared to 60.00% in the same period in 2025 with overall expenses declining 2% as compared to the same period in 2025. • Total deposits increased $54.6 million, or 2%, as compared to December 31, 2025. • Noninterest-bearing deposits of $1.03 billion at June 30, 2026, represent 35% of total deposits. • Cost of deposits declined to 1.14% as compared to 1.31% in the same quarter in 2025. • Core non-maturity deposits increased $67.8 million, or 3%, from December 31, 2025. • Uninsured deposits, exclusive of public funds, are approximately 25% of total deposit balances. • Increased Tangible Book Value per share by $0.50, or 1.9% to $26.19 per share during the quarter. • The Community Bank Leverage Ratio increased to 12.25% for our subsidiary bank. • Wholesale funding, including brokered deposits, is used primarily to fund the mortgage warehouse business line which provides a strong match of duration. • Overall primary and secondary liquidity sources of $2.0 billion at June 30, 2026. • Primary liquidity ratio was stable at 19.1% at June 30, 2026, compared to 20% at March 31, 2026. For the six months ended June 30, 2026
Page 14
FINANCIAL TRENDS 1.29% 0.97% 0.94% 1.12% 1.15% 1.24% 3.51% 3.40% 3.28% 3.60% 3.70% 3.69% 59.92% 60.15% 63.90% 60.76% 58.91% 57.70% 0.00% 10.00% 20.00% 30.00% 40.00% 50.00% 60.00% 70.00% 0% 1% 2% 3% 4% 5% 12/31/2021 12/31/2022 12/31/2023 12/31/2024 12/31/2025 6/30/2026 EFFICIENCY RATIO ROAA AND NIM RATIOS Return on Average Assets Net Interest Margin Efficiency Ratio 14 Tax-Equivalent NIM: 3.75%
Page 15
COMPOUND ANNUAL GROWTH RATES Since December 31, 2019 3%5%6% TOTAL LIABILITIES DEPOSITS EQUITY 15
Page 16
STRONG LOW-COST DEPOSIT MIX 16 $2,761,223$2,846,164$2,781,572 $2,891,668 $2,876,436 ($ in thousands) The above excludes customer repurchase agreements, which were $122 million for Q2 2026. $2,930,991 39% 38% 37% 35% 35% 35% 27% 23% 19% 20% 20% 20% 16% 16% 14% 12% 13% 12% 5% 5% 5% 5% 5% 6% 11% 14% 20% 18% 16% 15% 2% 4% 5% 10% 11% 11% 12/31/2021 12/31/2022 12/31/2023 12/31/2024 12/31/2025 6/30/2026 Noninterest Demand Deposits Interest-Bearing Transaction Savings Deposits Money Market Deposits Customer Time Deposits Brokered Deposits 0.09% 0.24% 1.09% 1.50% 1.27% 1.11% 0.08% 1.68% 5.02% 5.14% 4.21% 3.64% Cost of Average Total Deposits YTD Average Fed Funds Rate YTD
Page 17
PERSONAL/NON-PERSONAL DEPOSITS ($ in thousands) Note: As of June 30, 2026, brokered deposits included $227 million in time deposits and $90 million in non-maturity deposits. As of December 31, 2025, brokered deposits included $194 million in time deposits and $125 million in non-maturity deposits. The Bank’s brokered deposits are primarily used to efficiently fund Mortgage Warehouse. $1,007,846 $1,154,150 $317,177 $451,818 $- $200,000 $400,000 $600,000 $800,000 $1,000,000 $1,200,000 PERSONAL Non- Maturity NON-PERSONAL Non-Maturity BROKERED DEPOSITS TIME DEPOSITS $983,247 $1,110,945 $320,090 $462,153 $- $200,000 $400,000 $600,000 $800,000 $1,000,000 $1,200,000 PERSONAL Non- Maturity NON-PERSONAL Non-Maturity BROKERED DEPOSITS TIME DEPOSITS 17 93,209 16,716 N/A 4,453 94,784 17,168 N/A 4,605# of Accounts: # of Accounts: % of Total: 81% 15% 4% % of Total: 81% 15% 4%
Page 18
COMPOUND ANNUAL GROWTH RATES Since December 31, 2019 7%5%6% TOTAL ASSETS LOANS INVESTMENTS 18
Page 19
19Loan amounts are net deferred fees; 30-89 Days DQ % includes non-accrual loans The increase in the ACL was primarily due to a $2.5 million specific reserve established during the second quarter on a single agricultural loan. This reserve covers the total principal balance of the loan. Following the end of the second quarter, Bank of the Sierra received a $0.5 million payment on this loan. The increase in loans 30-89 days and still accruing was primarily due to a single commercial real estate loan that became 30 days past due near the end of the second quarter . Management believes the loan is well secured. Management expects modest growth in average balances in Mortgage Warehouse from its current levels. Residential Real Estate loans are comprised primarily of jumbo loans purchased in 2021 and early 2022 with strong underwriting. LOAN PORTFOLIO COMPOSITION Period End Balances ($ in thousands) 6/30/2026 12/31/2025 Loan Segment Outstanding Balance ($) Outstanding Balance ($) Total Variance ($) % of Portfolio NPL % 30-89 Days DQ Allowance Balance ($) Coverage Ratio (%) Allowance Balance ($) Coverage Ratio (%) Commercial Real Estate 1,389,730$ 1,390,890$ (1,160)$ 56.58% 0.00% 0.35% 15,913$ 1.15% 16,354$ 1.18% Other Construction/Land 15,851 14,414 1,437 0.65% 0.00% 0.00% 307 1.94% 296 2.05% Farmland Real Estate 65,759 68,307 (2,548) 2.68% 4.72% 1.13% 532 0.81% 496 0.73% Other Commercial 179,164 192,577 (13,413) 7.29% 3.95% 1.54% 4,895 2.73% 2,146 1.11% Consumer Loans 2,524 2,810 (286) 0.10% 0.08% 0.04% 108 4.28% 112 3.99% Subtotal 1,653,028 1,668,998 (15,970) 67.30% 0.62% 0.50% 21,755 1.32% 19,404 1.16% Residential Real Estate 345,575 359,514 (13,939) 14.07% 0.10% 0.02% 1,320 0.38% 1,411 0.39% Mortgage Warehouse Lines 457,457 518,333 (60,876) 18.63% 0.00% 0.00% 525 0.11% 665 0.13% Total 2,456,060$ 2,546,845$ (90,785)$ 100.00% 0.43% 0.34% 23,600$ 0.96% 21,480$ 0.84% 6/30/2026 6/30/2026 12/31/2025
Page 20
DIVERSIFIED REAL ESTATE PORTFOLIO 20 CRE Non-Owner Occupied Breakout Retail 33% Warehouse/ Industrial 15% Office 16%Hospitality 25% Other 11% Total Real Estate Portfolio: $1,816,915 Residential Real Estate 19% CRE Non-Owner Occupied 51% CRE Owner Occupied 18%Construction 1% Multifamily 7% Farmland 4%
Page 21
LOAN PORTFOLIO ACTIVITY ($ in thousands) 21
Page 22
ASSET QUALITY TRENDS Total nonperforming assets, decreased by $4.3 million to $10.5 million, during the second quarter of 2026. The decrease in nonperforming assets was primarily attributable to reductions in nonperforming commercial and agricultural credits, as well as the timely resolution and sale of an OREO asset in March 2026. All the Company's nonperforming assets are individually evaluated for credit loss quarterly, and Management believes the established allowance for credit loss on such loans is appropriate. 22 Ratios 12/31/2021 12/31/2022 12/31/2023 12/31/2024 12/31/2025 3/31/2026 6/30/2026 Classified Loans/Gross Loans 1.67% 2.38% 1.71% 1.91% 1.23% 1.28% 1.19% NPLs/Gross Loans 0.23% 0.95% 0.38% 0.84% 0.52% 0.42% 0.43% NPAs/Total Assets 0.14% 0.54% 0.21% 0.54% 0.39% 0.28% 0.43% 30-89 Past Dues/Gross Loans 0.10% 0.06% 0.01% 0.06% 0.27% 0.04% 0.22% Net Charge-offs/Average Loans -0.01% 0.58% 0.18% 0.15% 0.39% 0.05% 0.03%
Page 23
MORTGAGE WAREHOUSE TRENDS $148 $55 $82 $258 $380 $418 $0 $50 $100 $150 $200 $250 $300 $350 $400 $450 2021 2022 2023 2024 2025 YTD Q2 2026 R etu r n o n A ver a g e A ssets $378 $660 $373 $638 $766 $794 28% 10% 31% 51% 68% 57% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% $0 $100 $200 $300 $400 $500 $600 $700 $800 $900 2021 2022 2023 2024 2025 Q2 2026 Return on Average Equity Total Commitments Utilization Rate Average Daily Balances Commitments and Utilization In millions ($) 23 In millions ($) • Bank of the Sierra entered the Mortgage Warehouse business in 2004. We have recently expanded throughout 8 states from Florida to California. • Continues to serve as a resilient and strategically important part of the Bank’s loan portfolio. • Despite the dynamic real estate market, the Bank’s Mortgage Warehouse portfolio has demonstrated strong performance and continued strategic growth, driven by expanded relationships and prudent risk management. • Effective pricing strategies based on the risk of underlying individual mortgage loans match funded primarily with wholesale funding of similar duration. • Increased seller, product, and geographic diversification allow for maintenance of appropriate margins and application of prudent credit standards. • Highly efficient operational and credit processes maintain low-cost structure while providing an agile platform for capitalizing on tactical and strategic opportunities. Performance & Growth Stable Margins
Page 24
INVESTMENT PORTFOLIO COMPOSITION U.S. Government Agencies 4% Mortgage-Backed Securities 40% Municipal Bonds 24%Corporate Bonds 10% Collateralized Loan Obligations 22% U.S. Government Agencies 2% Mortgage-Backed Securities 42% Municipal Bonds 26%Corporate Bonds 9% Collateralized Loan Obligations 21% Based on Period End Balances – Fair Value ($ in thousands) Fair Value - $911,791* Fourth Quarter Yield - 4.33% Fair Value - $890,570 Second Quarter Yield - 4.48% 24 CLOs were $183 million at June 30, 2026 as compared to $199 million at December 31, 2025
Page 25
EXECUTIVE LEADERSHIP Experienced executive management team consisting of a combination of tenured and newer executives with a focus on earnings and balance sheet growth Kevin McPhaill President and Chief Executive Officer Joined Company in 2001; CEO since 2015 35 years of Banking Experience Christopher Treece EVP and Chief Financial/Operations Officer Joined Company in 2020 34 years of Banking Experience Hugh Boyle EVP and Chief Credit Officer Joined Company in 2020 31 years of Banking Experience Michael Olague EVP and Chief Banking Officer Joined Company in 2009; CBO since 2015 48 years of Banking Experience Natalia Coen EVP and Chief Risk Officer Joined Company in 2023 20 years of Banking Experience 25
Page 26
KEEP CLIMBING NASDAQ: BSRR COMPANY CONTACTS: Kevin McPhaill, President & CEO, kmcphaill@bankofthesierra.com Christopher Treece, EVP & CFO/COO, ctreece@bankofthesierra.com