EX-99.2 3 ex992.htm EX-99.2
EXHIBIT 99.2 Earnings Release Supplement Second Quarter 2021

Citizens Community Bancorp, Inc. Table of Contents Segment Profiles COVID-19 Related Loan Deferrals Non-Owner Occupied CRE Owner Occupied CRE Multi-family Commercial & Industrial Loans Construction & Development Loans Agricultural Real Estate & Operating Loans Hotel Loans Restaurant Loans Credit Quality/Risk Rating Descriptions Loans by Risk Rating as of June 30, 2021 Loans by Rish Rating as of March 31, 2021 Loans by Risk Rating as of December 31, 2020 Loans by Risk Rating as of June 30, 2020 Allowance for Loan Losses Nonaccrual Loans Roll forward Other Real Estate Owned Roll forward Troubled Debt Restructurings in Accrual Status Acquired Loans – Non-accretable difference and accretable discount tables Earnings Per Share Selected Capital Composition Highlights – Bank and Company Page(s) 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 17 17 18 19 20 1

COVID-19 Related Loan Deferrals Dollars in Thousands COVID-19 Deferrals Balance Number of Loans Commercial Deferrals Hotel Loans 31,117$ 5 Other Commercial Loans 2,469 9 Total Commercial Deferrals 33,586 14 Residential Deferrals 2,148 17 Consumer Deferrals - - Total Deferrals 35,734$ 31 June 30, 2021 Commercial Loan Deferral Expiration by Quarter as of June 30, 2021 Balance Number of Loans Hotel Loans Quarter Ending September 30, 2021 11,926$ 3 Quarter Ending December 31, 2021 - - Quarter Ending March 31, 2022 19,191* 2 Total Hotel Loans 31,117 5 Other Commercial Loans Quarter Ending September 30, 2021 2,392 8 Quarter Ending December 31, 2021 77 1 Total Other Commercial Loans 2,469$ 9 Total Commercial Deferral Expirations 33,586$ 14 *Interest only deferral – borrower provided 2 years principal and interest payments 2

Portfolio Fundamentals 54%35% 11% Wisconsin Minnesota Other By Geography As of 06/30/21 • Typically well seasoned investors with multiple projects, track record of success and personal financial strength (net worth/Liquidity) • Maximum LTV =<80% with recourse to owners with >20% interest • Term of 5-10 years with 20 to 25-year amortizations depending on property type, markets and strength and liquidity of sponsors • Minimum DSC and/or Global DSC covenant required to monitor performance ranging from 1.15x-1.25x • Conservative underwriting approach emphasizing actual results or market data • Appropriate use of SBA 504/7a for lower cash injection or special use projects Non – Owner Occupied CRE As of 06/30/21 As of 03/31/21 $353 $311 752 765 $469 $406 Approximate Weighted Average LTV 59% 55% 2.3x 2.4x Weighted Average Seasoning In Months 26 28 0.00% 0.00% Approximate Weighted Average DSCR Trailing 12 Month Net Charge-Offs Loan Balance Outstanding In Millions Number of Loans Average Loan Size In Thousands Portfolio Characteristics - Non-Owner Occupied CRE 27% 23% 11% 9% 6% 5% 4% 2% 2% 11% Hotel Investor Residential CRE - Retail CRE - Office CRE - Warehouse/Mini Storage CRE - Senior Living CRE - Industrial/Manufacturing CRE - Mixed Use CRE - Bar/Restaurant Other Non – Owner Occupied CRE As of 06/30/21 3

19% 16% 11% 10% 10% 9% 7% 7% 2% 9% CRE Campground CRE Restaurant CRE Industrial/Manufacturing CRE Retail CRE Senior Living CRE Warehouse/Mini Storage CRE Mixed Use CRE Office Hotels Other Owner Occupied CRE As of 06/30/21 Portfolio Fundamentals 75% 14% 11% Wisconsin Minnesota Other By Geography As of 06/30/21 • Underwritten to <80% LTV based on appraised value (<75% for Restaurant) • Term of 5-10 years with 20-year amortization • Recourse to owners with greater than 20% interest • DSC covenant of 1.25x on project and/or Global DSC of 1.15x • Appropriate use of SBA 504/7a for lower cash injection or special use projects • By Geography “Other” segment includes borrowers with warm climates, no income tax states Owner Occupied CRE As of 06/30/21 As of 03/31/21 $207 $205 425 420 $488 $487 Approximate Weighted Average LTV 48% 50% 2.1x 2.1x Weighted Average Seasoning In Months 32 31 0.00% 0.00% Approximate Weighted Average DSCR Trailing 12 Month Net Charge-Offs Portfolio Characteristics - Owner Occupied CRE Loan Balance Outstanding In Millions Number of Loans Average Loan Size In Thousands 4

Portfolio Fundamentals 61% 37% 2% Wisconsin Minnesota Other By Geography As of 06/30/21 100% Multi-family Multi-family As of 06/30/21 • Robust housing markets in Eau Claire and Mankato markets supported by student populations at state universities, technical colleges, and growing population and job markets • Multi-family sponsors experienced owners with multi-project portfolios • Typically underwritten to 75% LTV based on appraised value with recourse; metro markets and/or strong sponsors may warrant up to 80% LTV • Term of 5-10 years with 20 to 25-year amortization (varies by new versus existing, size of market and sponsor strength) • Covenant for minimum DSC/Global DSC Multi-family As of 06/30/21 As of 03/31/21 $121 $119 104 102 $1.17 $1.17 67% 67% Approximate Weighted Average DSCR 1.8x 1.9x 21 18 0.00% 0.00% Approximate Weighted Average LTV Weighted Average Seasoning In Months Trailing 12 Month Net Charge-Offs Portfolio Characteristics - Multi-family Loan Balance Outstanding In Millions Number of Loans Average Loan Size In Millions 5

83% 16% 1% Wisconsin Minnesota Other (1%) By Geography As of 06/30/21 18% 12% 11% 8%8% 6% 6% 5% 5% 4% 4% 4% 3% 6% Manufacturing Public Admin Transportation and Warehousing Wholesale Trade Construction Real Estate, Rental and Leasing Agriculture Retail Trade Administrative Support Education Services Health Care Other Services Finance and Insurance Other Commercial & Industrial As of 06/30/21 Portfolio Fundamentals • Highly diversified, secured loan portfolio underwritten with recourse • Lines of credit reviewed annually and may have borrowing base certificates governing line usage • Fixed asset LTV’s based on age and type of equipment; <5-year amortization • Use of SBA Guaranty Program (Preferred Lender or General Processing) as appropriate • “Retail Trade” segment consists of Farm Supply, Franchised Hardware, Franchised Auto Parts, Franchised and Non-franchised Auto Dealers and Repair Shops, Convenience Stores/Gas Stations Commercial & Industrial Loans As of 06/30/21 As of 03/31/21 $100 $96 736 756 $137 $127 2.7x 2.7x 27 25 0.35% 0.42% Committed Line, if collateral 57 58 Approximate Weighted Average DSCR Weighted Average Seasoning In Months Trailing 12 Month Net Charge-Offs Portfolio Characteristics - Commercial & Industrial Loan Balance In Millions Number of Loans Average Loan Size In Thousands 6

Portfolio Fundamentals 20% 16% 12%12% 8% 8% 8% 6% 10% Commercial 1-4 Family Construction CRE Multi-family CRE Senior Living CRE Warehouse/Mini Storage CRE Retail CRE Hospitality Other Land CRE Campground Other Commercial & Development As of 06/30/21 48% 37% 15% Wisconsin Minnesota Other By Geography As of 06/30/21 • Underwritten to 75-80% LTV based on lesser of cost or appraised value with full recourse • Interest only typically up to 18 months (depending on project complexity and seasonal timing) followed by amortization of 15-25 years (terms vary by property type) • Borrower equity contribution of cash/land value =>15% injected at the beginning of project (cash/land contribution) • Construction loans require 3rd Party inspections and Title Company draws after balancing to sworn construction statement • 1-4 Residential construction centered in eastern Twin Cities and Northwest Wisconsin. Generally 80% LTC /60%-80% of AV. Spec building capped. Progress reporting monthly by individual home Construction & Development Loans As of 06/30/21 As of 03/31/2021 Loan Balance Outstanding In Millions $91 $90 Number of Loans 118 109 Average Loan Size In Thousands $769 $832 Approximate Weighted Average LTV 61% 56% Trailing 12 Month Net Charge-Offs 0.00% 0.00% Percent Utilized of Commitments 58% 63% Portfolio Characteristics - Construction & Development 7

39% 24% 22% 15% Crop Dairy Other Farming Other Agricultural As of 06/30/21 Portfolio Fundamentals 70% 27% 3% Wisconsin Minnesota Other By Geography As of 06/30/21 • Producers required to have marketing plans to mitigate volatility of commodities • Appropriate crop/revenue insurance and/or dairy margin protection required • Maximum Ag RE LTV of less than 65%; Equipment LTV of less than 75% • Appropriate structuring to separate crop production cycles and to match length of loan with asset financed • Use of Farmer Mac, FSA, SBA or USDA programs to address DSC, collateral margins or working capital Agricultural Real Estate & Operating Loans As of 06/30/21 As of 03/31/21 $101 $98 568 611 $177 $162 1.8x 1.8x 33 34 0.12% 0.16% Approximate Weighted Average DSCR Weighted Average Seasoning In Months Trailing 12 Month Net Charge-Offs Portfolio Characteristics - Agricultural Loan Balance Outstanding In Millions Number of Loans Average Loan Size In Thousands 8

68% 20% 12% Flagged Historic Boutique Other Hotels As of 06/30/21 Portfolio Fundamentals 51% 32% 17% Minnesota Wisconsin Illinois By Geography As of 06/30/21 • Mainly experienced multi project hoteliers and guarantors with strong personal financial statements (net worth and liquidity) • Mainly flagged properties • Historic hotels are two hotels in Twin Cities area • Underwriting consistent with management's conservative approach to Investor CRE, emphasizing actual results in underwriting Hotel Loans As of 06/30/21 As of 03/31/21 $93 $93 32 32 $2.9 $2.9 53% 56% 2.3x 2.3x 0.00% 0.00%Trailing 12 Month Net Charge Offs Number of Loans Approximate DSCR - Non-Construction Portfolio Characteristics - Hotels Loan Balance Outstanding In Millions Average Loan Size In Millions Approximate Weighted Average LTV 9

53% 16% 10% 8% 7% 6% Culver's - Limited Service Restaurants Micro Breweries Other National Limited Services Drinking Establishments Other Restaurants As of 06/30/21 Portfolio Fundamentals 79% 20% 1% Wisconsin Minnesota Other By Geography As of 06/30/21 • Experienced developers/operators of national Limited /Quick Service brands (Culver’s, Subway, Dairy Queen, McDonalds, Jimmy John’s, A&W) • Underwritten to =<80% LTV with full recourse (depending on sponsor history); 20-year amortization with 5 to 10-year terms • Use of SBA Guaranty Program (Preferred Lender or General Processing) as appropriate • Drinking establishments may have other collateral pledged and tend to be in smaller communities in our footprint • Micro Breweries concentrated in Eau Claire area • Lessors of RE include investor and owner-occupied structure Restaurant Loans As of 06/30/21 As of 03/31/2021 $39 $39 83 87 $464 $444 59% 57% 3.5x 3.5x 0.00% 0.00% Portfolio Characteristics - Restaurants Approximate Weighted Average DSCR Trailing 12 Month Net Charge-Offs Loan Balance Outstanding In Millions Number of Loans Average Loan Size In Thousands Approximate Weighted Average LTV 10

Credit Quality/Risk Ratings: Management utilizes a numeric risk rating system to identify and quantify the Bank’s risk of loss within its loan portfolio. Ratings are initially assigned prior to funding the loan, and may be changed at any time as circumstances warrant. Ratings range from the highest to lowest quality based on factors that include measurements of ability to pay, collateral type and value, borrower stability and management experience. The Bank’s loan portfolio is presented below in accordance with the risk rating framework that has been commonly adopted by the federal banking agencies. The definitions of the various risk rating categories are as follows: 1 through 4 - Pass. A “Pass” loan means that the condition of the borrower and the performance of the loan is satisfactory or better. 5 - Watch. A “Watch” loan has clearly identifiable developing weaknesses that deserve additional attention from management. Weaknesses that are not corrected or mitigated, may jeopardize the ability of the borrower to repay the loan in the future. 6 - Special Mention. A “Special Mention” loan has one or more potential weakness that deserve management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or in the institution’s credit position in the future. 7 - Substandard. A “Substandard” loan is inadequately protected by the current net worth and paying capacity of the obligor or the collateral pledged, if any. Assets classified as substandard must have a well-defined weakness, or weaknesses, that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the Bank will sustain some loss if the deficiencies are not corrected. 8 - Doubtful. A “Doubtful” loan has all the weaknesses inherent in a Substandard loan with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions and values, highly questionable and improbable. 9 - Loss. Loans classified as “Loss” are considered uncollectible, and their continuance as bankable assets is not warranted. This classification does not mean that the loan has absolutely no recovery or salvage value, and a partial recovery may occur in the future. 11

Below is a breakdown of loans by risk rating as of June 30, 2021: 1 to 5 6 7 8 9 TOTAL Originated Loans: Commercial/Agricultural real estate: Commercial real estate $ 419,278 $ 506 $ 781 $ — $ — $ 420,565 Agricultural real estate 41,425 378 1,122 — — 42,925 Multi-family real estate 113,491 299 — — — 113,790 Construction and land development 86,108 — 3,478 — — 89,586 C&I/Agricultural operating: Commercial and industrial 77,758 16 3,009 — — 80,783 Agricultural operating 21,261 22 1,731 — — 23,014 Residential mortgage: Residential mortgage 69,549 — 3,416 — — 72,965 Purchased HELOC loans 4,715 — 234 — — 4,949 Consumer installment: Originated indirect paper 20,196 — 181 — — 20,377 Other consumer 10,250 — 46 — — 10,296 Originated loans before SBA PPP loans 864,031 1,221 13,998 — — 879,250 SBA PPP loans 74,925 — — — — 74,925 Total originated loans $ 938,956 $ 1,221 $ 13,998 $ — $ — $ 954,175 Acquired Loans: Commercial/Agricultural real estate: Commercial real estate $ 124,647 $ 10,876 $ 3,974 $ — $ — $ 139,497 Agricultural real estate 24,576 — 5,164 — — 29,740 Multi-family real estate 7,401 — — — — 7,401 Construction and land development 961 202 39 — — 1,202 C&I/Agricultural operating: Commercial and industrial 19,391 9 301 — — 19,701 Agricultural operating 4,482 — 411 — — 4,893 Residential mortgage: Residential mortgage 31,782 — 1,999 — — 33,781 Consumer installment: Other consumer 644 — 4 — — 648 Total acquired loans $ 213,884 $ 11,087 $ 11,892 $ — $ — $ 236,863 Total Loans: Commercial/Agricultural real estate: Commercial real estate $ 543,925 $ 11,382 $ 4,755 $ — $ — $ 560,062 Agricultural real estate 66,001 378 6,286 — — 72,665 Multi-family real estate 120,892 299 — — — 121,191 Construction and land development 87,069 202 3,517 — — 90,788 C&I/Agricultural operating: Commercial and industrial 97,149 25 3,310 — — 100,484 Agricultural operating 25,743 22 2,142 — — 27,907 Residential mortgage: Residential mortgage 101,331 — 5,415 — — 106,746 Purchased HELOC loans 4,715 — 234 — — 4,949 Consumer installment: Originated indirect paper 20,196 — 181 — — 20,377 Other consumer 10,894 — 50 — — 10,944 Gross Loans Before SBA PPP Loans $ 1,077,915 $ 12,308 $ 25,890 $ — $ — $ 1,116,113 SBA PPP loans 74,925 — — — — 74,925 Gross loans $ 1,152,840 $ 12,308 $ 25,890 $ — $ — $ 1,191,038 Less: Unearned net deferred fees and costs and loans in process (5,133) Unamortized discount on acquired loans (4,347) Allowance for loan losses (16,845) Loans receivable, net $ 1,164,713 12

Below is a breakdown of loans by risk rating as of March 31, 2021: 1 to 5 6 7 8 9 TOTAL Originated Loans: Commercial/Agricultural real estate: Commercial real estate $ 363,758 $ 764 $ 1,081 $ — $ — $ 365,603 Agricultural real estate 36,439 522 1,179 — — 38,140 Multi-family real estate 111,199 304 — — — 111,503 Construction and land development 80,458 — 3,478 — — 83,936 C&I/Agricultural operating: Commercial and industrial 72,355 317 4,021 — — 76,693 Agricultural operating 20,003 1,045 101 — — 21,149 Residential mortgage: Residential mortgage 78,764 — 3,521 — — 82,285 Purchased HELOC loans 5,057 — 234 — — 5,291 Consumer installment: Originated indirect paper 23,024 — 162 — — 23,186 Other consumer 10,906 — 45 — — 10,951 Originated loans before SBA PPP loans $ 801,963 $ 2,952 $ 13,822 $ — $ — $ 818,737 SBA PPP loans 118,931 — — — — 118,931 Total originated loans $ 920,894 $ 2,952 $ 13,822 $ — $ — $ 937,668 Acquired Loans: Commercial/Agricultural real estate: Commercial real estate $ 135,059 $ 10,494 $ 4,033 $ — $ — $ 149,586 Agricultural real estate 27,041 — 5,386 — — 32,427 Multi-family real estate 7,485 — — — — 7,485 Construction and land development 6,553 204 39 — — 6,796 C&I/Agricultural operating: Commercial and industrial 18,865 9 366 — — 19,240 Agricultural operating 6,754 — 347 — — 7,101 Residential mortgage: Residential mortgage 37,982 — 2,064 — — 40,046 Consumer installment: Other consumer 906 — 7 — — 913 Total acquired loans $ 240,645 $ 10,707 $ 12,242 $ — $ — $ 263,594 Total Loans: Commercial/Agricultural real estate: Commercial real estate $ 498,817 $ 11,258 $ 5,114 $ — $ — $ 515,189 Agricultural real estate 63,480 522 6,565 — — 70,567 Multi-family real estate 118,684 304 — — — 118,988 Construction and land development 87,011 204 3,517 — — 90,732 C&I/Agricultural operating: Commercial and industrial 91,220 326 4,387 — — 95,933 Agricultural operating 26,757 1,045 448 — — 28,250 Residential mortgage: Residential mortgage 116,746 — 5,585 — — 122,331 Purchased HELOC loans 5,057 — 234 — — 5,291 Consumer installment: Originated indirect paper 23,024 — 162 — — 23,186 Other consumer 11,812 — 52 — — 11,864 Gross Loans Before SBA PPP Loans $ 1,042,608 $ 13,659 $ 26,064 $ — $ — $ 1,082,331 SBA PPP loans 118,931 — — — — 118,931 Gross loans $ 1,161,539 $ 13,659 $ 26,064 $ — $ — $ 1,201,262 Less: Unearned net deferred fees and costs and loans in process (4,487) Unamortized discount on acquired loans (4,649) Allowance for loan losses (16,860) Loans receivable, net $ 1,175,266 13

Below is a breakdown of loans by risk rating as of December 31, 2020: 1 to 5 6 7 8 9 TOTAL Originated Loans: Commercial/Agricultural real estate: Commercial real estate $ 349,482 $ 543 $ 1,088 $ — $ — $ 351,113 Agricultural real estate 30,041 446 1,254 — — 31,741 Multi-family real estate 112,423 308 — — — 112,731 Construction and land development 87,763 — 3,478 — — 91,241 C&I/Agricultural operating: Commercial and industrial 91,474 20 3,796 — — 95,290 Agricultural operating 22,462 934 1,061 — — 24,457 Residential mortgage: Residential mortgage 82,097 7 4,179 — — 86,283 Purchased HELOC loans 5,959 — 301 — — 6,260 Consumer installment: Originated indirect paper 25,616 — 235 — — 25,851 Other consumer 11,986 — 70 — — 12,056 Originated loans before SBA PPP loans $ 819,303 $ 2,258 $ 15,462 $ — $ — $ 837,023 SBA PPP loans 123,702 — — — — 123,702 Total originated loans $ 943,005 $ 2,258 $ 15,462 $ — $ — $ 960,725 Acquired Loans: Commercial/Agricultural real estate: Commercial real estate $ 148,303 $ 4,274 $ 3,985 $ — $ — $ 156,562 Agricultural real estate 31,147 — 5,907 — — 37,054 Multi-family real estate 9,273 — 148 — — 9,421 Construction and land development 7,237 — 39 — — 7,276 C&I/Agricultural operating: Commercial and industrial 20,918 9 336 — — 21,263 Agricultural operating 7,838 — 490 — — 8,328 Residential mortgage: Residential mortgage 42,805 131 2,167 — — 45,103 Consumer installment: Other consumer 1,150 — 7 — — 1,157 Total acquired loans $ 268,671 $ 4,414 $ 13,079 $ — $ — $ 286,164 Total Loans: Commercial/Agricultural real estate: Commercial real estate $ 497,785 $ 4,817 $ 5,073 $ — $ — $ 507,675 Agricultural real estate 61,188 446 7,161 — — 68,795 Multi-family real estate 121,696 308 148 — — 122,152 Construction and land development 95,000 — 3,517 — — 98,517 C&I/Agricultural operating: Commercial and industrial 112,392 29 4,132 — — 116,553 Agricultural operating 30,300 934 1,551 — — 32,785 Residential mortgage: Residential mortgage 124,902 138 6,346 — — 131,386 Purchased HELOC loans 5,959 — 301 — — 6,260 Consumer installment: Originated indirect paper 25,616 — 235 — — 25,851 Other consumer 13,136 — 77 — — 13,213 Gross Loans Before SBA PPP Loans $ 1,087,974 $ 6,672 $ 28,541 $ — $ — $ 1,123,187 SBA PPP loans 123,702 — — — — 123,702 Gross loans $ 1,211,676 $ 6,672 $ 28,541 $ — $ — $ 1,246,889 Less: Unearned net deferred fees and costs and loans in process (4,245) Unamortized discount on acquired loans (5,063) Allowance for loan losses (17,043) Loans receivable, net $ 1,220,538 14

Below is a breakdown of loans by risk rating as of June 30, 2020: 1 to 5 6 7 8 9 TOTAL Originated Loans: Commercial/Agricultural real estate: Commercial real estate $ 308,633 $ 4,952 $ 805 $ — $ — $ 314,390 Agricultural real estate 32,592 469 2,077 — — 35,138 Multi-family real estate 90,617 — — — — 90,617 Construction and land development 85,511 5,867 3,478 — — 94,856 C&I/Agricultural operating: Commercial and industrial 76,447 661 3,261 — — 80,369 Agricultural operating 24,488 768 557 — — 25,813 Residential mortgage: Residential mortgage 91,649 — 4,015 — — 95,664 Purchased HELOC loans 6,534 — 327 — — 6,861 Consumer installment: Originated indirect paper 31,815 — 216 — — 32,031 Other consumer 14,082 — 93 — — 14,175 Originated loans before SBA PPP loans $ 762,368 $ 12,717 $ 14,829 $ — $ — $ 789,914 SBA PPP loans 137,330 — — — — 137,330 Total originated loans $ 899,698 $ 12,717 $ 14,829 $ — $ — $ 927,244 Acquired Loans: Commercial/Agricultural real estate: Commercial real estate $ 180,003 $ 6,699 $ 8,633 $ — $ — $ 195,335 Agricultural real estate 35,712 — 7,342 — — 43,054 Multi-family real estate 12,874 — 148 — — 13,022 Construction and land development 15,086 — 190 — — 15,276 C&I/Agricultural operating: Commercial and industrial 28,274 59 1,144 — — 29,477 Agricultural operating 10,723 80 1,321 — — 12,124 Residential mortgage: Residential mortgage 54,058 403 2,299 — — 56,760 Consumer installment: Other consumer 1,634 — 5 — — 1,639 Total acquired loans $ 338,364 $ 7,241 $ 21,082 $ — $ — $ 366,687 Total Loans: Commercial/Agricultural real estate: Commercial real estate $ 488,636 $ 11,651 $ 9,438 $ — $ — $ 509,725 Agricultural real estate 68,304 469 9,419 — — 78,192 Multi-family real estate 103,491 — 148 — — 103,639 Construction and land development 100,597 5,867 3,668 — — 110,132 C&I/Agricultural operating: Commercial and industrial 104,721 720 4,405 — — 109,846 Agricultural operating 35,211 848 1,878 — — 37,937 Residential mortgage: Residential mortgage 145,707 403 6,314 — — 152,424 Purchased HELOC loans 6,534 — 327 — — 6,861 Consumer installment: Originated indirect paper 31,815 — 216 — — 32,031 Other consumer 15,716 — 98 — — 15,814 Gross Loans Before SBA PPP Loans $ 1,100,732 $ 19,958 $ 35,911 $ — $ — $ 1,156,601 SBA PPP loans 137,330 — — — — 137,330 Gross loans $ 1,238,062 $ 19,958 $ 35,911 $ — $ — $ 1,293,931 Less: Unearned net deferred fees and costs and loans in process (5,369) Unamortized discount on acquired loans (7,387) Allowance for loan losses (13,373) Loans receivable, net $ 1,267,802 15

Allowance for Loan Losses (in thousand, except ratios) June 30, 2021 and Three Months Ended March 31, 2021 and Three Months Ended December 31, 2020 and Three Months Ended June 30, 2020 and Three Months Ended Allowance for loan losses (“ALL”), at beginning of period $ 16,860 $ 17,043 $ 14,836 $ 11,835 Loans charged off: Commercial/Agricultural real estate (51) (200) — — C&I/Agricultural operating (7) — (300) (246) Residential mortgage — — — — Consumer installment (15) (25) (23) (65) Total loans charged off (73) (225) (323) (311) Recoveries of loans previously charged off: Commercial/Agricultural real estate 1 5 1 76 C&I/Agricultural operating 33 15 11 — Residential mortgage 3 8 — 6 Consumer installment 21 14 18 17 Total recoveries of loans previously charged off: 58 42 30 99 Net loans charged off (“NCOs”) (15) (183) (293) (212) Additions to ALL via provision for loan losses charged to operations — — 2,500 1,750 ALL, at end of period $ 16,845 $ 16,860 $ 17,043 $ 13,373 Average outstanding loan balance $ 1,186,439 $ 1,213,562 $ 1,240,895 $ 1,266,273 Ratios: NCOs (annualized) to average loans 0.01 % 0.06 % 0.09 % 0.07 % 16

Nonaccrual Loans Roll forward (in thousands) Quarter Ended June 30, 2021 March 31, 2021 December 31, 2020 September 30, 2020 June 30, 2020 Balance, beginning of period $ 8,678 $ 10,747 $ 13,154 $ 14,787 $ 16,090 Additions 863 430 912 716 1,907 Acquired nonaccrual loans — — — — — Charge offs (58) (205) (2) (141) (175) Transfers to OREO — (45) — (172) — Return to accrual status (696) (291) — (165) (1,702) Payments received (712) (1,935) (3,317) (1,744) (1,292) Other, net — (23) — (127) (41) Balance, end of period $ 8,075 $ 8,678 $ 10,747 $ 13,154 $ 14,787 Other Real Estate Owned Roll forward (in thousands) Quarter Ended June 30, 2021 March 31, 2021 December 31, 2020 September 30, 2020 June 30, 2020 Balance, beginning of period $ 57 $ 156 $ 756 $ 692 $ 1,412 Loans transferred in — 45 — 172 — Branch properties transferred in 79 — — — — Sales (5) (142) (529) (86) (681) Write-downs — — (68) (26) (151) Other, net (2) (2) (3) 4 112 Balance, end of period $ 129 $ 57 $ 156 $ 756 $ 692 Troubled Debt Restructurings in Accrual Status (in thousands, except number of modifications) June 30, 2021 March 31, 2021 December 31, 2020 June 30, 2020 Number of Modifications Recorded Investment Number of Modifications Recorded Investment Number of Modifications Recorded Investment Number of Modifications Recorded Investment Troubled debt restructurings: Accrual Status Commercial/Agricultural real estate 14 $ 4,841 14 $ 4,472 16 $ 4,695 19 $ 1,885 C&I/Agricultural Operating 6 3,804 5 4,042 4 3,836 5 1,199 Residential mortgage 40 3,040 44 3,195 43 3,162 39 2,981 Consumer installment 7 51 8 43 8 49 8 62 Total loans 67 $ 11,736 71 $ 11,752 71 $ 11,742 71 $ 6,127 Acquired loans represent much of the reduction in non-performing loans and classified loans. The table below shows the changes in the Bank’s non-accretable difference on purchased credit impaired loans. The second table below shows the changes in the Bank’s accretable loan discount which was established at each acquisition. The 17

Bank has transferred the non-accretable difference on purchased credit impaired loans to accretable discount as collateral coverage improved sufficiently, due to a combination of principal paydowns and/or improving collateral positions. This transferred non-accretable difference to accretable discount is accreted over the remaining maturity of the loan or until payoff, whichever is shorter. Non-accretable difference: (in thousands) June 30, 2021 March 31, 2021 December 31, 2020 September 30, 2020 June 30, 2020 Non-accretable difference, beginning of period $ 966 $ 1,087 $ 1,661 $ 3,355 $ 4,327 Additions to non-accretable difference for acquired purchased credit impaired loans — — — — — Non-accretable difference realized as interest from payoffs of purchased credit impaired loans (37) (58) (324) (130) (196) Transfers from non-accretable difference to accretable discount (106) (63) (50) (1,294) (741) Non-accretable difference used to reduce loan principal balance — — (200) (270) (35) Non-accretable difference transferred to OREO due to loan foreclosure — — — — — Non-accretable difference, end of period $ 823 $ 966 $ 1,087 $ 1,661 $ 3,355 The table below provides the changes in accretable discount for acquired loans. Accretable discount: (in thousands) June 30, 2021 March 31, 2021 December 31, 2020 September 30, 2020 June 30, 2020 Accretable discount, beginning of period $ 3,683 $ 3,976 $ 5,050 $ 4,032 $ 3,637 Additions to accretable discount for acquired performing loans — — — — — Accelerated accretion from payoff of certain purchased credit impaired loans with transferred non-accretable difference — (90) (872) — (99) Transfers from non-accretable difference to accretable discount 106 63 50 1,294 741 Scheduled accretion (265) (266) (252) (276) (247) Accretable discount, end of period $ 3,524 $ 3,683 $ 3,976 $ 5,050 $ 4,032 18

On November 30, 2020, a 5% stock repurchase program was authorized by the Board of Directors. Under this authorization, 198 thousand shares, or 1.8% of the shares outstanding, were repurchased during the quarter ended June 30, 2021. As of June 30, 2021, there were $10.7 million shares outstanding and an additional 36 thousand shares could be repurchased under the the program. Earnings Per Share (Amounts in thousands, except per share data, share count in thousands) Three Months Ended Six Months Ended June 30, 2021 March 31, 2021 June 30, 2020 June 30, 2021 June 30, 2020 Basic Net income attributable to common shareholders $ 4,706 $ 5,506 $ 3,069 $ 10,212 $ 5,675 Weighted average common shares outstanding 10,778 10,980 11,151 10,879 11,182 Basic earnings per share $ 0.44 $ 0.50 $ 0.28 $ 0.94 $ 0.51 Diluted Net income attributable to common shareholders $ 4,706 $ 5,506 $ 3,069 $ 10,212 $ 5,675 Weighted average common shares outstanding 10,778 10,980 11,151 10,879 11,182 Add: Dilutive stock options outstanding 12 6 — 8 1 Average shares and dilutive potential common shares 10,790 10,986 11,151 10,887 11,183 Diluted earnings per share $ 0.44 $ 0.50 $ 0.28 $ 0.94 $ 0.51 Common stock issued and outstanding 10,696 10,894 11,151 10,696 11,151 19

CITIZENS COMMUNITY FEDERAL N.A. Selected Capital Composition Highlights June 30, 2021 (unaudited) March 31, 2021 (unaudited) December 31, 2020 (audited) June 30, 2020 (unaudited) To Be Well Capitalized Under Prompt Corrective Action Provisions Tier 1 leverage ratio (to adjusted total assets) 9.7% 9.8% 9.9% 9.9% 5.0% Tier 1 capital (to risk weighted assets) 13.5% 14.3% 13.5% 12.9% 8.0% Common equity tier 1 capital (to risk weighted assets) 13.5% 14.3% 13.5% 12.9% 6.5% Total capital (to risk weighted assets) 14.7% 15.5% 14.7% 14.0% 10.0% CITIZENS COMMUNITY BANCORP, INC. Selected Capital Composition Highlights June 30, 2021 (unaudited) March 31, 2021 (unaudited) December 31, 2020 (audited) June 30, 2020 (unaudited) For Capital Adequacy Purposes Tier 1 leverage ratio (to adjusted total assets) 7.5% 7.5% 7.7% 7.4% 4.0% Tier 1 capital (to risk weighted assets) 10.4% 11.0% 10.5% 9.7% 6.0% Common equity tier 1 capital (to risk weighted assets) 10.4% 11.0% 10.5% 9.7% 4.5% Total capital (to risk weighted assets) 14.2% 14.9% 14.3% 12.1% 8.0% 20