First Western Financial : Investor Presentation November 2023

INVESTOR PRESENTATION

November 2023

Safe Harbor

This presentation contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements reflect the current views of First Western Financial, Inc.'s ("First Western") management with respect to, among other things, future events and First Western's financial performance. These statements are often, but not always, made through the use of words or phrases such as "may," "should," "could," "predict," "potential," "believe," "will likely result," "expect," "continue," "will," "anticipate," "seek," "estimate," "intend," "plan," "position," "project," "future" "forecast," "goal," "target," "would" and "outlook," or the negative variations of those words or other comparable words of a future or forward-looking nature. These forward-looking statements are not historical facts, and are based on current expectations, estimates and projections about First Western's industry, management's beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond First Western's control. Accordingly, First Western cautions you that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions and uncertainties that are difficult to predict. Although First Western believes that the expectations reflected in these forward-looking statements are reasonable as of the date made, actual results may prove to be materially different from the results expressed or implied by the forward-looking statements. The following risks and uncertainties, among others, could cause actual results and future events to differ materially from those set forth or contemplated in the forward-looking statements: integration risks in connection with acquisitions; the risk of geographic concentration in Colorado, Arizona, Wyoming, California, and Montana; the risk of changes in the economy affecting real estate values and liquidity; the risk in our ability to continue to originate residential real estate loans and sell such loans; risks specific to commercial loans and borrowers; the risk of claims and litigation pertaining to our fiduciary responsibilities; the risk of competition for investment managers and professionals; the risk of fluctuation in the value of our investment securities; the risk of changes in interest rates; and the risk of the adequacy of our allowance for credit losses and the risk in our ability to maintain a strong core deposit base or other low-cost funding sources. Additional information regarding these and other risks and uncertainties to which our business and future financial performance are subject is contained in our Annual Report on Form 10-K filed with the U.S. Securities and Exchange Commission ("SEC") on March 15, 2023 and other documents we file with the SEC from time to time. All subsequent written and oral forward-looking statements attributable to First Western or persons acting on First Western's behalf are expressly qualified in their entirety by this paragraph. Forward-looking statements speak only as of the date of this presentation. First Western undertakes no obligation to publicly update or otherwise revise any forward-looking statements, whether as a result of new information, future events or otherwise (except as required by law).

Certain of the information contained herein may be derived from information provided by industry sources. The Company believes that such information is accurate and the sources from which it has been obtained are reliable; however, the Company cannot guaranty the accuracy of such information and has not independently verified such information.

This presentation contains certain non-GAAP financial measures intended to supplement, not substitute for, comparable GAAP measures. Reconciliations of non-GAAP financial measures to GAAP financial measures are provided at the end of this presentation. Numbers in the presentation may not sum due to rounding.

Our common stock is not a deposit or savings account. Our common stock is not insured by the Federal Deposit Insurance Corporation or any governmental agency or instrumentality.

This presentation is not an offer to sell any securities and it is not soliciting an offer to buy any securities in any state or jurisdiction where the offer or sale is not permitted. Neither the SEC nor any state securities commission has approved or disapproved of the securities of the Company or passed upon the accuracy or adequacy of this presentation. Any representation to the contrary is a criminal offense. Except as otherwise indicated, this presentation speaks as of the date hereof. The delivery of this presentation shall not, under any circumstances, create any implication that there has been no change in the affairs of the Company after the date hereof.

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An Emerging High Performing Institution

Overview

Target Market

Competitive

Advantage

• Niche-focusedregional wealth manager built on a private trust bank platform
• Headquartered in Denver, Colorado and

positioned in desirable, affluent and high	MT
growth markets
 Households of $1+ million liquid net worth	WY
 High net worth and high growth markets
 Colorado, Arizona, Wyoming, California and
Montana	CO
CA
 Operates as one integrated firm, not silos
 Team approach benefits both clients and	AZ
First Western

• Local boutique private trust bank offices with central product experts

Office Locations

		(as of 9/30/23)
		Assets:	$3.00 billion
		Total Loans:	$2.54 billion
		Total Deposits:	$2.42 billion
Company		AUM:	$6.40 billion
Highlights		(for the year ending 12/31/22)
		Loan Growth:	26.7%
		Deposit Growth:	9.0%
		Asset Growth:	13.4%
		TBV/Share(1) Growth:	10.7%

(1) See Non-GAAP reconciliation	3

Investment Highlights

Attractive

Markets and

Business Model

• Rapidly growing institution operating in high growth markets
• Attractive, stable deposit base with noninterest-bearing and money market accounts comprising 77% of total deposits
• Conservative underwriting and affluent client base results in exceptional asset quality with minimal credit losses

Strong Earnings

Momentum

• Significant revenue growth driving improved operating leverage and higher profitability
• TBV/share(1) increased 25% in 2020, 21% in 2021, and 11% in 2022
• Continued scale expected to drive further leverage and generate returns consistent with a high performing institution over long term

Proven Execution

on Growth

Strategies

• Track record of combining organic growth and market expansion with accretive acquisitions to enhance franchise value
• Total assets up 58% in 2020, 28% in 2021, and 13% in 2022 with substantial increases in revenue and EPS
• Strengthening commercial banking platform creating more diverse loan portfolio and lower-cost deposit base

High Insider

Ownership and

Discounted

Valuation

• Highly aligned with shareholder interests as insiders own ~18% of total shares outstanding(2)
• Discounted valuation trading at just 0.6x TBV/share(3)

(1)	See Non-GAAP reconciliation
(2)	Represents beneficial ownership as defined by the Proxy Statement	4
(3)	As of October 30, 2023

Strong Operational and Financial Momentum

Drivers of Improved Performance

• Robust organic balance sheet growth
• Accretive acquisitions
• Market expansion
• Highly leverageable operating platform driving improved efficiencies
• Outstanding asset quality and low credit costs

			Adjusted Pre-Tax,Pre-Provision Income(1) ($000s)
$40,000					$38,429		$33,733
$35,000
					$32,611
$30,000
$25,000
$20,000
$15,000
			$10,854
$10,000	$4,556	$5,795	$7,602
$5,000
$0
2016	2017	2018	2019	2020	2021	2022

(1) See Non-GAAP reconciliation	5

Consistent Value Creation

TBV/Share(1) Up 144% Since July 2018 IPO

Consistent increases in tangible book value per share driven by:

• Organic growth that has increased operating leverage
• Accretive acquisitions that have been well priced and smoothly integrated to realize all projected cost savings
• Conservative underwriting criteria that has resulted in extremely low level of losses in the portfolio throughout the history of the company
• Prudent asset/liability management including not investing excess liquidity accumulated during the pandemic in low-yielding bonds

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Franchise Overview

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Great Markets, Scarce Investment Opportunity

Characteristics of First Western Markets

Deposits by MSA (1)

• Ranked among states with highest GDP growth
• Strong job and population growth
• Experiencing significant in-migration
• Attractive demographics with large amount of high net worth individuals that utilize private banking and investment management services
• Favorable tax laws for trusts and estates that attract wealthy individuals

Phoenix, AZ

8%

Deposits by State

Colorado 79%

Wyoming 13%

Arizona 8%

Fort Collins,	Boulder, CO
CO	7%
20%	Other
	8%

Rock Springs,

WY 3%

Denver, CO	Jackson, WY
6%
48%

MYFW is 2nd Largest Publicly Held CO Chartered Bank

As of September 30, 2023	Current Ownership	Total Assets
($bn)
FirstBank	Private	28.2
NBH Bank	Public (NYSE: NBHC)	9.9
Sunflower Bank	Private	7.8
Bank of Colorado	Private (Sub. Of Pinnacle	7.0
Bancorp-NE)
Alpine Bank	Private	6.5
ANB Bank	Private	3.2
First Western Trust Bank	Public (Nasdaq: MYFW)	3.0
(1) Source: S&P Capital IQ as of 06/30/2023
(2) Percentage growth in household income (HHI).	8

Small Market Share Provides Large Growth Opportunity

MSA	State	Market	Projected % Change in
Share	HHI (2021-2026)(2)
Denver-Aurora-Lakewood	CO	1.00	11.00
Fort Collins	CO	4.62	13.45
Phoenix-Mesa-Scottsdale	AZ	0.12	13.18
Boulder	CO	1.39	11.41
Jackson	WY/ID	4.47	8.50
Rock Springs	WY	7.16	8.82
National Average			9.01

MYFW: Our Five Core Strengths

Differentiated,

Proven in the

Marketplace

• Niche-focused franchise headquartered in Denver, Colorado
• Well-positionedin many attractive markets in Arizona, California, Colorado, Montana, and Wyoming
• Specialized central expertise to compete with siloed national, regional firms
• Delivered through local, boutique trust banking teams so clients "owned" by MYFW, not associates

Built-in Operating

Leverage

• Strong profit center margins at maturity, growth opportunities in current and new markets
• Revenue growth over long-term in both fee income and net interest income, with neutral balance sheet
• Scalable, leverageable high fixed cost, low variable cost Product and Support Centers
• Operating expense investment already in place for growth and expansion

	Highly Desirable	 Primarily recurring trust and investment management ("TIM") fees
	Recurring Fee		Low risk, "sticky" wealth/trust business with comprehensive product offering
	Income		Multiple entry points with ConnectView® - proprietary review process to service, cross-sell

Experienced, Tested Team

• Executives are major bank/professional firm trained, with deep relationships in communities
• Achieved growth through business and economic cycles, capital constraints
• Healthy relationship with all regulators with strong risk management culture
• CEO with proven track record for creating value in previous bank ownership

Unique

Opportunity for

Investors

• At critical mass but small market share, many current and new market opportunities
• Proven ability to expand: (1) Organically, (2) By expansion and (3) By acquisition
• Few large Colorado bank alternatives for investors and clients, creating lift-outopportunities
• Attractive revenue and earnings growth story trading at discounted valuation

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Cross-Selling a Diverse Set of Products and Services

Our local profit centers team with specialized product experts through ConnectView®, with many points of entry

Commercial	 Corporate loans to match specific needs
	Well-versed in working with complex cash flows and business models
Banking
	Customized treasury management products and services

Retirement /

401(k)

Plan Consulting

• Retirement plan consultants partnering with businesses to sponsor retirement plans
• Creative corporate retirement plan design, analysis solutions, fiduciary liability management
• ERISA compliance and education

Residential	 Mortgage banking specializing in purchase money, high net worth lending
	Underwritten to Fannie Mae and Freddie Mac guidelines
Mortgage Lending
	Targeted portfolio lending and secondary sales
	 Wealth planning with specialized services (e.g. philanthropic)
Wealth Planning
	Proprietary ConnectView® approach, with access to CFPs, CPAs and estate planning attorneys
	 Charitable giving tax strategies, deferred-compensation plans, life insurance, key person insurance
	 Provide a broad range of asset and sub asset classes, with automated tax and basis management
Investment
	Create unique solutions through internal research, proprietary and third-party investment options
Management
	Central team creates the platform for Portfolio Managers to service clients, manage accounts
	 Fiduciary wealth management with expert review of client objectives, creating solutions
Trust		Irrevocable life insurance trust, conservatorship, successor trustee, directed custodial trusteeship
	 WY tax-exempt asset protection, special needs trusts, escrow services, family office services
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