Byline Bancorp : Third Quarter 2020 Earnings Conference Call Presentation

Q3 2020 Conference Call

Forward-Looking Statements

This communication contains forward-looking statements within the meaning of the U.S. federal securities laws. Forward-looking statements include, without limitation, statements concerning plans, estimates, calculations, forecasts and projections with respect to the anticipated future performance of the Company. These statements are often, but not always, made through the use of words or phrases such as ''may'', ''might'', ''should'', ''could'', ''predict'', ''potential'', ''believe'', ''expect'', ''continue'', ''will'', ''anticipate'', ''seek'', ''estimate'', ''intend'', ''plan'', ''projection'', ''would'', ''annualized'', "target" and ''outlook'', or the negative version of those words or other comparable words or phrases of a future or forward-looking nature. Forward-looking statements involve estimates and known and unknown risks, and reflect various assumptions and involve elements of subjective judgement and analysis, which may or may not prove to be correct, and which are subject to uncertainties and contingencies outside the control of Byline and its respective affiliates, directors, employees and other representatives, which could cause actual results to differ materially from those presented in this communication.

The COVID-19 pandemic is adversely affecting us, our employees, customers, counterparties and third-party service providers, and the ultimate extent of the impacts on our business, financial position, results of operations, liquidity, and prospects is uncertain. Continued deterioration in general business and economic conditions, including further increases in unemployment rates, or turbulence in U.S. or global financial markets could adversely affect our revenues and the values of our assets and liabilities, reduce the availability of funding, lead to a tightening of credit, and further increase stock price volatility. In addition, changes to statutes, regulations, or regulatory policies or practices as a result of, or in response to COVID-19, could affect us in substantial and unpredictable ways.

No representations, warranties or guarantees are or will be made by Byline as to the reliability, accuracy or completeness of any forward-looking statements contained in this communication or that such forward-looking statements are or will remain based on reasonable assumptions. You should not place undue reliance on any forward-looking statements contained in this communication.

Certain risks and important factors that could affect Byline's future results are identified in its Annual Report on Form 10-K and other reports filed with the Securities and Exchange Commission, including among other things under the heading "Risk Factors" in its Annual Report on Form 10-K, for the year ended December 31, 2019, and its Quarterly Reports on Form 10-Q for the quarters ended March 31, 2020 and June 30, 2020. Any forward-looking statement speaks only as of the date on which it is made, and Byline undertakes no obligation to update any forward-looking statement, whether to reflect events or circumstances after the date on which the statement is made, to reflect new information or the occurrence of unanticipated events, or otherwise unless required under the federal securities laws.

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Third Quarter 2020 Summary

Significant Increase

in PTPP(1)

While Managing

Through

1. Challenging Environment

• Net income of $13.1 million, or $0.34 per diluted share, compared to $9.1 million, or $0.24 per diluted share, in 2Q20
• PTPP (1) of $34.1 million, up from $28.4 million in 2Q20
• ROAA of 0.81% up from 0.59% in 2Q20; Pre-taxpre-provision ROAA(1) of 2.12% up from 1.85% in 2Q20
• Reduction in deposit costs helping to offset net interest margin pressure
• • Average cost of deposits declined 14 bps to 0.22% in 3Q20
• Record level of government guaranteed loan production and gain on loan sale income
• • Net gain on loan sales increased to $12.7 million from $6.5 million in 2Q20
• Efficiency ratio of 52.47%, compared to 53.70% in 2Q20
• Strategic consolidation of 11 branches to drive further efficiency improvements in 2021

	▪ Total assets increased by $103.8 million, or 1.6% from 2Q20
	▪ Total loans and leases remained relatively flat to prior quarter
Balance Sheet	▪ Strong government guaranteed originations and conventional commercial loan pipeline build
	▪ Non-interest bearing deposits remain at 35% of total deposits in 3Q20
	▪ Total deposits declined to $4.8 billion driven by continued runoff of higher cost deposits and seasonal tax payments
	▪ Total loan deferrals declined to 0.8% of total loans and leases compared to 14.6% at 2Q20
Credit Management	▪ NPLs and NPAs remain relatively stable at 0.99% and 0.79%, respectively
▪ Continued reserve build with ALLL increasing to 1.40%, or 1.63% ex- PPP loans, from 1.17% and 1.36% in 2Q20
	▪ ALLL + AAA / loans and leases increasing to 1.79%, or 2.08% ex- PPP, from 1.60% and 1.86% in 2Q20

Capital

and Liquidity

▪ Strong capital levels with a CET1 ratio of 12.55% and total RBC ratio of 16.67% increasing 22 bps and 80 bps for the quarter ▪ Tangible book value per common share of $15.81 compared to $15.47 in 2Q20

▪ Strong liquidity position with $2.6 billion in total funding availability at September 30, 2020

▪ Completed additional issuance of $25.0 million in sub debt to further strengthen capital position ▪ Continued quarterly dividend of $0.03 per share

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1. Pre-TaxPre-Provision Net Income, represents a non-GAAP financial measure. See "Non-GAAP Reconciliation" in the appendix.

Consistent Progress in Strategic Branch Consolidation ($ in millions)

• Third significant branch consolidation since recap in 2013
• 11 branches identified for consolidation at the end of 2020; approximately 20% of current branch network
• Annualized estimated cost savings of $4.3 million
• • ~25% of cost savings to be redeployed into further investment in digital banking platform and renovation/upgrading of other retail branches
• Estimated one-time charge of $5.9 million; including $696,000 recognized during 3Q20 related to salaries and benefit expenses
• Pro forma branch consolidation impact on 3Q20 deposits / branch increasing to $104.6 million

Retail Branch Count		Deposits per Branch

87

$84.4

83

$63.6

	57			59	61					$43.7	$43.6
	56			46
								$24.1	$26.3

$68.0

4Q14

4Q15

4Q16

4Q17

4Q18

4Q19

4Q20*

Byline Branches

Branches Added in Acquisitions

4Q14 4Q15 4Q16 4Q17 4Q18 4Q19 3Q20

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*Pro forma to reflect planned 4Q20 branch consolidation