Citizens Bancorp Investment : Quarterly Dividend Notice to Shareholders

CITIZENS BANCORP INVESTMENT, INC.

August 10, 2022

Dear Stockholder:

Our board of directors approved a dividend of $0.16 per share, to shareholders of record on August 3, 2022, payable on August 10, 2022. Enclosed is a check or notice of direct deposit for your dividend.

Earnings for the second quarter of 2022 totaled $4.4 million (unaudited). Net income equaled first quarter 2022 earnings of $4.4 million but was down 11.2% from second quarter 2021 earnings of $5.0 million. Fully diluted earnings per share were $0.74 versus $0.84 for the second quarter 2021. Earnings for 2022 year-to-datewere $8.8 million compared to $9.5 million in 2021, a 7.3% decrease. Net interest income declined due primarily to lower loan fees resulting from the end of the Paycheck Protection Program in 2021 and continued lower rates on portfolio loans due to the low rate environment at the beginning of 2022. Lower revenue on loans in 2022 was only partially offset by higher income on securities and lower interest costs on deposits compared to 2021. Non-interest income for the second quarter declined 9.7% compared to 2021 due to significantly reduced mortgage refinancing activity and lower insurance income. However, increases in mortgage serving income, debit card income, and overdraft income partially offset the reduction in mortgage refinancing gains and insurance income. Due to higher mortgage rates, mortgage volume for purchases continues to be modest.

Total assets were $1.48 billion at June 30, 2022 versus $1.40 billion in 2021, a 5.4% increase. Total deposits were $1.33 billion at June 30, 2022, an 8.8% increase versus 2021. The government stimulus factored significantly in the $107 million growth in Citizens Bank's deposits since June 30, 2021. Total loans were $876 million at June 30, 2022, a 10.3% increase versus 2022. Bank management pursued an aggressive loan growth strategy in early 2022 to take advantage of a strong economy and market fears of rising interest rates. Citizens Bancorp's capital remained strong at $116.2 million at June 30, 2022; this represents 7.84% of total assets. Capital declined approximately 12.4% from June 2021 levels due to unrealized losses in investment portfolio values, net of retained earnings. Management expects to hold the securities, and thus, does not expect to realize those losses. Enclosed with this letter are the financial highlights for the quarter.

As the Federal Reserve Board continues to increase interest rates and the economy begins to soften, your management and board have guided the bank to solid earnings, strong credit quality, and a dedicated employee group. These strengths should help the bank weather any economic storms ahead. Our stock continues to hold its value with the most recent trade at $43 per share.

Please call us if we can help you with your banking needs.

Very truly yours,

Peter G. Williston

Chief Executive Officer

Citizens Bancorp Investment, Inc.

Enclosure

P.O. Box 100 | 400 Highway 52 West, Lafayette, TN 37083 | T 615-666-2195 | F 615-666-6287

www.citizens-bank.org