Economic News

Newswires RSS Get our newsletter

Order Prints

July 24, 2024 Newswires

Second Quarter 2024 Presentation

U.S. Markets via PUBT

INVESTOR PRESENTATION

2Q 2024

NASDAQ: ALRS

DISCLAIMERS (CONTINUED)

AlerusdditionalFinancialInformationCorporation (theand"Company")Where to filedFindaItRegistration Statement on Form S-4 (Registration Statement No. 333-280815) with the Securities and Exchange Commission (the "SEC") on July 15, 2024, in connection with a proposed transaction between the Company and HMN Financial, Inc. ("HMNF"). The registration statement includes a joint proxy statement of the Company and HMNF that also constitutes a prospectus of the Company, which will be sent to the stockholders of the Company and HMNF after the SEC declares the registration statement effective.

Before making any voting decision, the stockholders of the Company and HMNF are advised to read the joint proxy statement/prospectus, because it contains important information about the Company, HMNF and the proposed transaction.

This document and other documents relating to the proposed transaction filed by the Company 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 the Company's 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 can be obtained free of charge from the Company upon written request to Alerus Financial Corporation, Corporate Secretary, 401 Demers Avenue, Grand Forks, North Dakota 58201 or by calling (701) 795-3200, or from HMNF upon written request to HMN Financial, Inc., Corporate Secretary, 1016 Civic Center Drive NW, Rochester, Minnesota 55901 or by calling (507) 535-1200. 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.

ThisParticipantspresentationindoesthe Snotlicitationconstitute a solicitation of proxy, an offer to purchase or a solicitation of an offer to sell any securities. The Company, 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 the Company and HMNF in connection with the proposed transaction under SEC rules. Information about the directors and executive officers of the Company and HMNF is included in the joint proxy statement/prospectus for the proposed transaction filed with the SEC. This document may be obtained free of charge in the manner described above under "Additional Information and Where to Find It."

COMPANY PROFILE

Alerus is a commercial wealth bank and a national retirement plan provider

DIVERSIFIED REVENUE(1)

Last Twelve Months Ended June 30, 2024
Net Interest Income:				Retirement &
			Benefits
$88.2 million	Net Interest	Revenue

45.3% of revenue	Income		33.7%
45.3%

Noninterest Income:
$106.5 million				Wealth Advisory
54.7% of revenue		Banking Fees &	Revenue
		12.2%
			Other Revenue(2)
				8.8%

RETIREMENT AND BENEFITS

	Retirement			Benefits
	Plan administration		Health savings accounts
 Trust and custodial offerings		Flexible spending accounts
	Record keeping		COBRA
				$36.7		$36.7	$39.4

	$31.9	$34.2		$32.1

	AUA / AUM:
	$ in billions

	2019	2020	2021	2022	2023	2Q 2024

		BANKING						WEALTH ADVISORY
	Business Services		Consumer Services		Financial Planning: Retirement \| Tax \| Estate planning
 Commercial and small business		Private banking					Investment Management: Managed investments \| Brokerage
	offerings			Savings, money markets, CDs
			Trust and Fiduciary: Estate Administration \| Corporate Trusteeship
	Treasury Management services		Mortgage services
	SBA & CRE Lending
				$3.4	$3.8	$3.9	$4.4						$4.0	$3.6	$4.0	$4.2
			$3.0				$3.1	$3.3
		$2.4
	Assets:								AUA / AUM:
	$ in billions									$ in billions
		2019	2020	2021	2022	2023	2Q 2024		2019	2020	2021	2022	2023	2Q 2024

3 \|	1. Excludes net losses on investment securities of $24.6 million in 4Q 2023. See "Non-GAAP Disclosure Reconciliation."
	2. Banking and other revenue consists of service charges on deposit accounts, mortgage income, interchange income and other noninterest income.



Grand Forks, ND:

FRANCHISE FOOTPRINT



Fargo, ND:

4 offices

FULL-SERVICE BANKING



Twin

3 offices

Phoenix, AZ:

6 offices



2 offices

Cities, MN:

Offices in

RETIREMENT AND BENEFIT SERVICES



and

50 states



Minnesota North Dakota, Michigan

Retirement plan service clients in all

Colorado

Market Distribution and Client Base



16,700

Consumer banking clients

Employer-sponsored retirement and benefit

 8,400

Commercial banking clients

plan participants and health savings account participants



37,300

 485,000

Flexible spending account and health



10,900

Employer-sponsored retirement plans

reimbursement arrangement participants

Wealth clients

 34,100

BANKING

LOANS: $2,916

DEPOSITS: $3,299

14.4%

28.2%26.5%

39.2%

57.4%9.9%

24.4%

WEALTH ADVISORY

AUA / AUM: $4,172

4.3% 11.6%

8.8%

75.3%

RETIREMENT AND BENEFITS

AUA / AUM: $39,390

9.3%

13.1%

77.6%

Data as of 6/30/2024.	LEGEND:	North Dakota	Minnesota	Arizona	National	Synergistic \| ($ in millions)

4 |

STRATEGIC GROWTH

To supplement our organic growth, we have executed 25 acquisitions throughout the history of our company

including: 15 in Banking, 10 in Retirement and Benefits. HMN Financial, Inc. will be our 26th acquisition.

	Rebranded to		Expanded to
1879	Alerus	2007	Arizona Market

2019

Acquired Metro

Phoenix Bank

2024


Began asthe Bank 2000		Expanded to	2009
of Grand Forks	Minnesota Market

Completed Initial Public Offering (IPO)

2022 Announced

acquisition of HMN

Financial, Inc.

	ROE(1) (5 Year History: 2019 - 2023)	ROA(1) (5 Year History: 2019 - 2023)
			12.5%		1.28%	1.31%
		11.2%


	9.2%
				1.08%
	KBW Regional	KBW Regional	Alerus Financial(2)	KBW Regional	KBW Regional	Alerus Financial(2)
	Bank Index	Bank Index		Bank Index	Bank Index
	(Average)	(Top Quartile)		(Average)	(Top Quartile)
5 \|	1. Source S&P Capital IQ.
	2. Excludes net losses on investment securities (after-tax) of $19.2 million in 4Q 2023. See "Non-GAAP Disclosure Reconciliation."

HMN FINANCIAL, INC. ACQUISITION HIGHLIGHTS

Natural Expansion of the Alerus Franchise

Strategic Expansion

Complementary mission and values with a strong

corporate and credit culture

Franchise-enhancing strategic expansion into the

vibrant Rochester, Minnesota, MSA

Benefits of additional scale

Assets(1)Loans(1)Deposits(1)

Financially Attractive(2)

Deal Value Per Share / TBVPS		2.2 years
TBV Earnback		107%

TBV Earnback	(3)	Accretive
(Excl. int. rate markets & AOCI)		0.9%
Core Deposit Premium		45%+
'25 EPS Accretion		25%+
Internal Rate of Return		1.15%+
'25 ROAA		12.5%+
'25 ROAE
'25 Efficiency Ratio Improvement	615+ bps
Pro Forma Loans / Deposits		85%
(MRQ)

Low Risk

High-quality, granular and long tenured loans and core deposit base

Excellent credit discipline

and asset quality

Seamless integration of straight-forward business lines

Leverages management's

transaction and

integration expertise

	$5.5									Strong pro forma capital ratios; creation of
							$4.3	capacity for continued growth

	$1.1			$3.8
									$1.0
	$4.4			$0.9		Proven ability to create revenue synergies
					$3.3
			$2.9
						across Alerus' diverse business lines


	$ in Billions	ALRS		HMNF	Pro-forma	(not modeled)

6 \|	1. Data as of 6/30/2024.
	2. Metrics disclosed with deal announcement on 5/15/2024. Metrics based on ALRS closing price of $20.69 on 5/14/2024.
	3. No rate mark scenario assumes no loan interest rate mark, AOCI mark, MSR mark or time deposit mark

Extensive operational and

credit due diligence

STRATEGIC INITIATIVES

One Alerus = Working Better Together to Grow

				Client
				Oriented
	Reinvention			Diversified
	of Processes			Services
				One
				Alerus

	Technology			Synergistic
	Investment			Growth
				Tailored
				Advice
Our Purpose Powers		Culture
Passion for Excellence	Success is Never Final
Act with accountability and	Embrace opportunities to
sense of urgency to best serve	adapt and growth with our
clients and achieve	industry and our clients
exceptional results			One Alerus
Do the Right Thing
Lead with integrity and	Work together to provide
provide valued advice and	purpose-driven products
	guidance		and services for our
					clients

				ORGANIC GROWTH	acquisition,
	Collaborative leadership team focused on
	retention, and					with existing clients
							new client
					focused on bringing value to clients
			deepening relationships
	through advice and specialty solutions to help clients grow
	Diversified busi	ess model		unavailable to traditional banking
	Leveraging
	organizations
	product synergies

		TALENT ACQUISIT ONS
	Recruiting top talent in mid-market C&I banking and specialty
	niches to		in our existing markets
		accelerate growth	into new markets with new talent
	Proactively positioning ourselves as an
	Jumpstarting our entrance
	of choice			acquirer and employer

		STRATEGIC ACQUISITION
	Capitalizing on str tegic opportunities to grow in our existing
	markets or new markets	banks	and nationwide	fee income
	Acquisition targets include
		with complementary business models, cultural
	similarities, and synergy and growth opportunities
	compan

	PRODUCTIVITY AND EFFICIENCY
 Providing secure and reliable technology that meets evolving
	client expectations
	Integrating our full product and service offerings through our
	fast-follower	technology strategy

OFFICERS AND DIRECTORS

EXECUTIVE MANAGEMENT

KATIE LORENSON

Director, President and

Chief Executive Officer

7 years with Alerus

BOARD OF DIRECTORS

DAN COUGHLIN

Since 2016

Chairman, Alerus Financial Corp.

Former MD & Co-Head - Fin'l Services

Inv. Banking, Raymond James; Former

Chairman & CEO, Howe Barnes Hoefer

& Arnett

AL VILLALON

Executive Vice President and Chief Financial Officer

2 years with Alerus

JIM COLLINS

Executive Vice President and Chief Banking and Revenue Officer 2 years with Alerus

FORREST WILSON

Executive Vice President and

Chief Retirement Services Officer

Joined Alerus in 2024

RANDY NEWMAN

Since 1987

Former President and CEO, Alerus

GALEN VETTER

Since 2013

Former Global CFO, Franklin Templeton

Investments; Former Partner-in-Charge,

Upper Midwest Region, RSM

MARY ZIMMER

Since 2021

Former Director of Diverse Client Segments and Former NortheRegional President, Wells Fargo Advisors; Former Head of Intl. Wealth USA, Royal Bank of Canada U.S. Wealth Mgmt.

KARIN TAYLOR

Executive Vice President and

Chief Risk Officer and Operating Officer 6 years with Alerus

MISSY KENEY

Executive Vice President and Chief Engagement Officer 19 years with Alerus

JON HENDRY

Executive Vice President and Chief Technology Officer 40 years with Alerus

JANET ESTEP

Since 2021

Former President and CEO, Nacha; Former EVP, US Bank Transaction Division; Former VP, Pace Analytical Services

JOHN URIBE

Since 2023

Chief Financial Officer

Blue Cross and Blue Shield of Minnesota

NIKKI SORUM

Since 2023

Former Head of Sales and Distribution, Thrivent;

Former SVP, Private Client Group,

RBC Wealth Management

SECOND QUARTER

HIGHLIGHTS

Office in

Excelsior, Minnesota

Attention: This is an excerpt of the original content. To continue reading it, access the original document here.

Attachments

Disclaimer

Alerus Financial Corporation published this content on 24 July 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 24 July 2024 20:36:08 UTC.

Older

Insurance giant seeks to question Adams adviser Frank Carone in ‘money laundering’ lawsuit

Newer

BLADEX ANNOUNCES 2Q24 NET PROFIT OF $50.1 MILLION, OR $1.36 PER SHARE; ANNUALIZED RETURN ON EQUITY OF 16.2% IN 2Q24 Form 6 K

Advisor News

More Advisor News

Annuity News

More Annuity News

Health/Employee Benefits News

More Health/Employee Benefits News

Life Insurance News

More Life Insurance News

Second Quarter 2024 Presentation

Advisor News

Annuity News

Health/Employee Benefits News

Life Insurance News

Sign in with your Insider Pro Account