Savi Financial: 2021 Audited Financial Statements

SAVI FINANCIAL CORPORATION, INC.

AND SUBSIDIARY BURLINGTON, WASHINGTON

AUDITED FINANCIAL STATEMENTS AND OTHER FINANCIAL INFORMATION

DECEMBER 31, 2021 AND 2020

CONTENT

PAGE

AUDITED FINANCIAL STATEMENTS:

Report of an Independent Registered Public Accountant Firm ……………………………. … …………………………..

1

Savi Financial Corporation, Inc. and subsidiary (consolidated):

Consolidated balance sheets ………………………………………… ……………… ………………………….. ……………… ……………

3

Consolidated income statements …………………………………….. ………………. …………………………. ………………. …..

4

Consolidated statements of comprehensive income ………………………… ………………… ………………………. .

5

Consolidated statements of changes in equity ………………………………………….. ………… ……………….

6

Consolidated statements of cash flows …………………………………….. …………………………………………………. ……….

7

SaviBank (bank only):

Balance sheets ………………………………………… . …………………………………………. . ……………………………..

9

Income statement ………………………………………… ……………… ………………………….. ……………… ……………………..

ten

Statements of comprehensive income ……………………………. ………………. …………………………. ………………. .

11

Statements of changes in equity ………………………………………….. ………………….. ………………………. ………..

12

Cash flow statements ………………………………………….. …………………………………………….. ….. …………………

13

Notes to the financial statements:

Consolidated and Bank only ………………………………………….. ……………………………………………. …. …………….

15

OTHER FINANCIAL INFORMATION:

Savi Financial Corporation, Inc. and Subsidiary:

Consolidated results ………………………………………… ……………… ………………………….. ……………… ……………

56

Consolidated income statement …………………………………….. ……………….. ………………………… ………………… …..

57

REPORT OF REGISTERED INDEPENDENT ACCOUNTING FIRM

To shareholders and

Board of Directors of Savi Financial Corporation, Inc. Burlington, Washington

Opinion on the financial statements

We have audited the accompanying consolidated financial statements of Savi Financial Corporation and its subsidiary, which include balance sheets as at December 31, 2021 and 2020, income statements, comprehensive income, changes in equity and related cash flows for the fiscal years ended on those dates. , and the accompanying notes to the consolidated financial statements (collectively, the “financial statements”). We have also audited the accompanying balance sheets of SaviBank (“Bank”) as at 31 December 2021 and 2020 and the related statements of income, comprehensive income, changes in equity and cash flows for the years then ended. . In our opinion, the financial statements present fairly, in all material respects, the financial position of the Corporation and the Bank as at December 31, 2021 and 2020, and the results of their operations and their cash flows for the years then ended. dates in accordance with generally accepted accounting principles in the United States of America.

Basis of opinion

These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent of the Company pursuant to United States federal securities laws and applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with PCAOB standards. These standards require that the audit be planned and performed to obtain reasonable assurance that the financial statements are free from material misstatement, whether due to error or fraud. The Company is not required to have, and we have not been retained to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over with regard to financial information. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that address those risks. These procedures included the examination, on a test basis, of the evidence concerning the amounts and the information appearing in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

We have acted as the Company’s auditor since 2007.

Other topics

Our audits have been carried out for the purpose of forming an opinion on the financial statements taken as a whole. The other financial information on pages 56 and 57 is presented for additional analysis purposes and does not necessarily form part of the financial statements. This information is the responsibility of management and is derived from and relates directly to the underlying accounting records and other documents used to prepare the financial statements. This information has been subject to the auditing procedures performed in the audit of the financial statements and certain additional procedures, including comparing and reconciling this information directly with the underlying accounting records and other documents used to prepare the financial statements or with the financial statements themselves, and other additional procedures in accordance with generally accepted auditing standards in the United States of America. In our opinion, the other financial information is presented fairly in all material respects of the financial statements taken as a whole.

STOVALL, GRANDEY & ALLEN, LLP

Fort Worth, TX

March 31, 2022

SAVI FINANCIAL CORPORATION, INC. AND SUBSIDIARY

CONSOLIDATED RESULTS

DECEMBER 31, 2021 AND 2020

ASSETS

Cash and balances with banks – Note 2 Interest-bearing deposits with other financial institutions maturing in less than three months Federal funds sold

Cash and cash equivalents

Interest-bearing deposits with other financial institutions maturing in more than three months Marketable securities – Note 3

Shares of Federal Home Loan Bank, at cost – Note 2 Shares of Pacific Coast Bankers’ Bank, at cost – Note 2 Loans held for sale – Note 4

Loans receivable, net of allowance for loan losses

2021

2020

$

$8,045,911 12,137,296

49,752,842 13,123,691

7,715,384 2,186,711

65,514,137 27,447,698

– 10,000,000

34,266,650 9,215,728

691,100 1,374,800

190,000 2,838,911

190,000 –and deferred borrowing costs – Note 4 345,167 233,342 107,111

Premises and equipment, net – Note 6 Assets seized and repossessed Accrued interest receivable

Core deposit intangible assets, net – Note 7

Bank-owned life insurance – Note 8

Deferred tax asset – Note 10

SBA management assets – Note 5 Other assets

Total assets

LIABILITIES

Deposits – Note 7

Federal Home Loan Bank borrowings – Note 12 Note payable – related party – Note 14

Accrued interest payable

Accrued expenses and other liabilities

Total responsibilities

Commitments and contingencies – Notes 6, 12, 13, 15, 16 and 20

EQUITY – Note 18

Ordinary shares, without par value; authorized: 10,000,000 shares

Issued and outstanding: 3,439,192 and 3,434,272 at

December 31, 2021 and 2020, respectively. Premium

Retained earnings

Accumulated other comprehensive income, after tax

(benefit) of ($79,340) and $8,567 to

December 31, 2021 and 2020, respectively

Total equity

Total Liabilities and Equity

15,786,082 14,827,726

921,748 960,304 1,155,887 9,433,134

492 573 968 328

880 773 616 322

891 243 874 967

$479,189,775

$432,423,735

5,000,000

2,500,000

93,414

1,589,134

441 606 283

28,258,618 577,336 9,046,006

(298,468) $37,583,492 479,189,775

The accompanying notes form an integral part of these financial statements.

487,026 1,267,577 – –$409,377,283

$348,925,509

25,000,000 –

200 255

1,018,853

375 144 617

28,233,128 504,896 5,462,415

32,227 $34,232,666 409,377,283

Marianne R. Winn