BEO Bancorp : 2022 Annual Financial Statement

BEO Bancorp and Subsidiary

Consolidated Financial Statements

With Independent Auditor's Report

Years Ended December 31, 2022 and 2021

C O N T E N T S

	Page
Message to Our Stockholders	1
Financial Highlights	2
Board of Directors and Officers	3
Independent Auditor's Report	4
Consolidated Financial Statements:
Consolidated Balance Sheets	6
Consolidated Statements of Income	7
Consolidated Statements of Profit and Other Comprehensive Income	8
Consolidated Statements of Changes in Stockholders' Equity	9
Consolidated Statements of Cash Flows	10
Notes to Consolidated Financial Statements	12

The Federal Deposit Insurance Corporation has not reviewed the financial data and

related data in this statement for accuracy or relevance.

BEO BANCORP

________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________

P.O. BOX 39 Heppner, OR 97836 Administrative Office: 279 N. Main Heppner, OR 97836 Phone: [phone]

Message to our stockholders

I present to you the consolidated financial statements and operating results for BEO Bancorp and Bank of Eastern Oregon for 2022.

By all typical financial measures, 2022 was a very strong year for your Bank. We ended 2021 in a very liquid and asset sensitive position. As 2022 unfolded, the tightening of fiscal policy and increasing interest rates by the Federal Reserve, during 2022, added significantly to our interest income.

2022 was a solid year for our agricultural producers. What started as a concerning year from a precipitation standpoint, turned more positive as late winter and spring rains arrived. While input prices increased with global events and supply chain problems, commodity prices across the board helped to offset the higher costs of production.

2022 consolidated net income was $8.585 million, up 24.1% from 2021, our previous highest net income level. Net loans increased 4.8% to $488.8 million, while deposits were up 8.8% ending the year at $819.8 million. It is important to note, for the first time in over 20 years, we made no provision for possible loan losses during 2022. Total assets were up 8.3% to $890.0 million, also a high-level mark for the Bank. Return on Average Assets (ROAA) for 2022 was 1.0% compared to 0.93% in 2021; Return on Average Equity (ROAE) came in at 17.54% versus 15.42% the previous year, an increase of 13.7%. Net earnings per share was $7.13 up 24.2% from 2021's $5.74 while shareholder equity was up 4.3% year over year. We also returned $1.00 per share dividend to our shareholders.

The above referenced results are not possible without the hard work and dedication of our employees. I commend and thank them for their work over the past years.

We plan to have our shareholder meeting at 7:00pm on Tuesday, April 25, 2023 at the Gilliam Bisbee building located in Heppner, OR at 106 E. May St. We plan to elect one director, review 2022, look ahead to 2023, and thank retiring director George Koffler for his many years of service.

As always, thank you for your investment in BEO Bancorp and Bank of Eastern Oregon.

Sincerely,

Jeff L. Bailey

President and CEO

BEO Bancorp

1

FINANCIAL HIGHLIGHTS

2018-2022

	2018	2019	2020	2021	2022
Net Income (000)	$3,949	$4,278	$5,523	$6,917	$8,585
Total Assets (000)	$414,379	$492,260	$666,699	$821,592	$890,095
Total Equity (000)	$34,580	$37,654	$41,935	$47,930	$49,986
Return on Average Assets	0.95%	0.94%	0.95%	0.93%	1.00%
Return on Average Equity	11.91%	11.84%	13.88%	15.39%	17.54%
Net Income Per Share	$3.33	$3.62	$4.66	$5.74	$7.13
Dividend Per Share	$0.85	$0.90	$0.95	$1.00	$1.00
GAAP Book Value Per Share	$29.21	$32.09	$34.96	$39.80	$41.51
Book Value Per Share before termporary adjustment
for Accumulated Other Comprehensive Loss	$29.32	$32.06	$35.53	$40.25	$46.38

	Book Value Per Share
			$39.80	$41.51
		$34.96
	$32.09
$29.21
2018	2019	2020	2021	2022
Total Stockholders' Equity (000)
			$47,930	$49,986
	$37,654	$41,935
$34,580

	Dividend Per Share
			$1.00	$1.00
		$0.95
	$0.90
$0.85
2018	2019	2020	2021	2022
Consolidated Net Income (000)	$8,585
			$6,917
		$5,523
$3,949	$4,278

2018

2019

2020

2021

2022

2018

2019

2020

2021

2022

2

Board of Directors:

Brad Anderson, Chairman	Partner, Triangle Ranches
Robert M. Armstrong, Vice Chairman	CPA, Solutions, CPA's
Jeff Bailey	Banker, Bank of Eastern Oregon
Joe Gonzalez	Owner, American Electric, Inc.
Gabrielle Homer	Financial Controller, Painted Hills Natural Beef
E. George Koffler	Retired Banker
Gary Neal	Retired General Manager, Port of Morrow
Joel Peterson	Owner, Daily Bread Farms, Inc.

Bank Officers:

Executive Team

Jeff Bailey, President & Chief Executive Officer	Becky Kindle, EVP & Chief Operations Officer
Mark Lemmon, EVP & Chief Financial Officer	John Qualls, EVP & Chief Lending Officer
Ed Rollins, EVP & Chief Credit Officer

Regional Vice Presidents:

Alan Bullard, Team Lead Loan Officer	Tracy Hamby, Team Lead Loan Officer
Jed Myers, Team Lead Loan Officer	Mike Short, Team Lead Loan Officer
Robert Williams, Team Lead Loan Officer

Vice Presidents:

Arletta Arnspiger, Mortgage Loan Officer	Cindy Bailey, Audit Manager
James Bleth, IT Manager	Nial Bradshaw, Loan Officer
Michael Broeckel, Loan Officer	Christy Correa, Controller
Karen Cossitt, Branch Manager	Gaye Doanato, Loan Officer
Dawna Dougherty, Compliance Officer	Laura Georges, Loan Officer
Jared Lathrop, Loan Officer	Shane Lazinka, Loan Officer
Pete McCabe, Loan Officer	Jill Martin, HR Manager
Kristy Nelson, Loan Officer	Anita Orem, Project Manager
Janice Provencher, Team Lead & Branch Manager	Robert Quinton, Loan Officer
Tricia Rollins, Loan Operations Manager	Amber Schlaich, Loan Officer
Logan Schleicher, Loan Officer	Rhonda Shaffer, Consumer Lending Mgr.
Lucy Sifuentez, Team Lead & Security Officer	Stefanie Teasley, Team Lead & Branch Manager
David Stirewalt, Loan Officer	Becky Temple, Loan Officer
Todd Wood, Loan Officer

Assistant Vice Presidents:

Laurie Barrow, Electronic Banking Specialist	Jennifer Berry, Senior Credit Analyst
Hector Lopez, Loan Officer	Heidi Nelson, IT
Sharon Rietmann, Branch Manager	Raymond Seastone, Construction Loan Officer

Lenders and Managers

Tressie Allen, Branch Manager	Andrea Austinson, Branch Manager
Caitlynn Bailey, Cash Mgt. Officer, Training Manager	Kendra Butterfield, Loan Officer
Ashley Delacruz, Branch Manager	Marissa Gutierrez, Branch Manager
Shelly Hankins, Team Lead & Branch Manager	Jay Hart, Loan Officer
Hector Lopez, Loan Officer	Sherrie Modey, Branch Manager
Debi Munck, Branch Manager	Kaitlin Orcutt, Mortgage Loan Officer
Rocio Orozco, Branch Manager	Melissa Pierson, Electronic Banking Manager
Melissa Samms, Branch Manager	Kallie Warren, Branch Manager
Lori Whitbeck, Branch Manager	Vanessa Williamson, Branch Manager
Dustin Winn, Branch Manager
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