The Provident Bank Executive TeamChuck Withee, President & Chief Lending Officer, Anne Lapointe, EVP & Chief Administrative Officer

Carol Houle, EVP & Chief Financial Officer, Dave Mansfield, CEO

FinancialsYear in Review

December 31, 2018

Total Assets

Total assets grew $72

million or 8% from 2017

796902

974

$0

$200

$400

$600

$800

$1,000

$1,200

2016 2017 2018

Total Assets

Total Loans

Gross loans increased $95 million or 13%

from 2017

633

753848

$0

$100

$200

$300

$400

$500

$600

$700

$800

$900

2016 2017 2018

Total Loans

Source: Uniform Bank Performance Report (12/31/18)

Commercial loans increased $122 million or 51% to 43% of total loans

Commercial Real Estate decreased $7 million or 2% to 48% of total loans

Residential/Consumer loans decreased $8 million or 9%

CRE57%

C&I32%

2017

CRE48%C&I

43%2018

Res/Con9%

Res/Con11%

12.52%

18.85%

12.58%

9.43%8.26%

7.02%7.83%

9.19%

6.76%

0%

5%

10%

15%

20%

2016 2017 2018

Loan Growth (%)

Provident MA NH

461

564 573173

191 200634

755 773

0

200

400

600

800

1000

2016 2017 2018

Total Deposits ($ in Millions)

Int. Bearing Non-Int Bearing

Total DepositsTotal deposits increased $18

million or 2% from 2017

$9 million of this increase

represents non-interest bearing

deposits.

543

108 18792 106 124

0

150

300

450

2016 2017 2018

Coverage Ratio (%)

0.20%

1.00%0.81%

0.96%0.83%

0.73%

0.00%0.20%0.40%0.60%0.80%1.00%1.20%

2016 2017 2018

Non-Performing Assets/Assets (%)

1.36%

1.30%

1.38%

1.30%

1.25% 1.24%

1.15%1.20%1.25%1.30%1.35%1.40%

2016 2017 2018

Loan Loss Reserves/Gross Loans (%)

0.00%

0.25%

0.18%0.23% 0.23%

0.18%

0.00%0.05%0.10%0.15%0.20%0.25%0.30%

2016 2017 2018

Net Charge-Offs/Average Loans (%)

Asset Quality Source: FDIC Quarterly Banking Profile Report

Provident Banks $100MM - $1BB

14.41%

13.71%13.30%

14.41%

13.71%13.30%

15.88%

14.96%14.55%

10.00%

11.00%

12.00%

13.00%

14.00%

15.00%

16.00%

17.00%

2016 2017 2018

Capital Ratios (%)

Tier 1 Common Equity Tier 1 Capital Ratio Total Capital Ratio

6,325

7,896

9,289

$0

$2,000

$4,000

$6,000

$8,000

$10,000

2016 2017 2018

Net IncomeNet Income

Net income increased $1.4 million or 18%

from 2017

0.84% 0.91%1.03%

0.00%0.20%0.40%0.60%0.80%1.00%1.20%

2016 2017 2018

ROAA (%)

5.98%6.84%

7.75%

0.00%2.00%4.00%6.00%8.00%

10.00%

2016 2017 2018

ROAE (%)

3.65%

3.90%

4.33%

3.20%3.40%3.60%3.80%4.00%4.20%4.40%

2016 2017 2018

Net Interest Margin (%)

68.59%

65.79%

61.53%58.00%60.00%62.00%64.00%66.00%68.00%70.00%

2016 2017 2018

Efficiency Ratio (%)

Profitability

Business & Strategic Update

Highly Profitable & Well Capitalized

Highly Engaged Board

Highly Efficient

Well Defined Business Models Specialty Focus

Banks Will Be Digital/Branch Hybrids Source: BankDirector

Highly Engaged Board

2019 Board of Directors

Highly Efficient

Improvement by everybody, everyday, everywhere resulting in customer delight (both internal and external)

• Multi-year journey began 2018• Kaizen Sensei Mike Wroblewski

• VP of Continuous Improvement Andi Jennings

• All Employee Engagement & Training• Continuous Improvement

• Standard Work

• Kaizen – change for the good

• Leadership and coaching

• Sustainability of lean culture and behavior

• 2019 Goal : Reduce employee burden (Muri) by 50%

Kaizen Events

FORMINGLearning about

each other

STORMING

Challenging each other

NORMINGWorking with each other

PERFORMING

Working as one

Kaizen Events

Lean Initiative Dashboard

Lean at The Provident Bank

Well Defined Business Models/Specialty Focus

Developing our Niches Fire Bullets then Cannonball

Fire BulletsLow cost/low risk

CalibrateMake adjustments

from learning

Fire CannonballCalibrated and

calculated

Source: Great by Choice, Jim Collins

Renewable Energy Loans

Year in ReviewDecember 31, 2018

In 2015, The Provident Bank began originating renewable energy niche loans.

As of 2018, we had 44 total loans providing renewable energy solutions in New England and New York

As of 2018, our renewable energy loan portfolio balance was $50 million

This was an increase of 82% from 2017

$0

$10,000,000

$20,000,000

$30,000,000

$40,000,000

$50,000,000

$60,000,000

2015 2016 2017 2018

Renewable Energy Loans - Yearly

Growth

$35.8 million of these loans were secured by solar arrays. The bank balance for solar array accounts increased by 29.1% from 2017

$14.7 million were secured by wind turbines, which are from two loan accounts opened in 2018 $0

$5,000,000

$10,000,000

$15,000,000

$20,000,000

$25,000,000

$30,000,000

$35,000,000

$40,000,000

Solar Arrays Wind Turbines

2018 Solar Portfolio by Sector

Enterprise Value LoansYear in Review

December 31, 2018

Enterprise Value Lending Strategy

•Dedicated lending teams with deep understanding of product and needs

• Brand recognition and consistent messaging

•Developed proprietary process

• Relationship driven partnerships

• Predictable structure

Enterprise Value Lending

• Full amortizing term loans up to 7 years; working capital lines of credit and equipment lines of credit

• Multiple of EBITDA less than 3x, verified by a CPA Quality of Earnings report

• Loan to value less than 50%, verified by a 3rd party business valuation

• Full deposit relationship with remote deposit capture and online banking (year-end 2018 total deposits = $36 million)

Enterprise Loan Origination

36 enterprise value loan relationships located in 17 states across the country

Total loan balances of $138.8 million and total loan exposure of $176.4 million

Enterprise Value Lending went National in 2018(as of year-end 2018)

At year-end 2018, enterprise value loan

balances totaled 16.6% of loan portfolio

Our enterprise value loan portfolio increase by

124.4% from 2017 to 2018.

2018 Provident Portfolio

Enterprise Value Loans

All Other Loans

$0

$20,000,000

$40,000,000

$60,000,000

$80,000,000

$100,000,000

$120,000,000

$140,000,000

$160,000,000

2015 2016 2017 2018

Enterprise Value Loans - Yearly

Growth

99% of enterprise loan balances were Pass rated.

Only 1% or $1.4 million of enterprise loan balances were rated Substandard

The Substandard balance is one loan that is on non-accrual, but regular monthly payments are currently being made.

-$10,000,000

$40,000,000

$90,000,000

$140,000,000

Pass Substandard

Enterprise Value Loans Risk Ratings

2018 Overview

Asset Quality(year-end 2018)

Consulting

Services

27%

IT & Software

20%Manufacturing

11%

Other

20%

Landscaping

9%

Repair Services

7%

Real Estate

6%Industry % of Total

Balance

Consulting Services 26%

IT & Software 20%

Manufacturing 11%

Landscaping 9%

Repair Services 7%

Real Estate 6%

Other* 20%

*”Other” includes sectors (such as Telecommunications, Hospitality and Media) that have combined loan balances of less than 4% of enterprise lending total.

Enterprise Value Lending Industry Diversification

78,796 91,583111,181

165,262

238,791

360,057

0

50,000

100,000

150,000

200,000

250,000

300,000

350,000

400,000

2013 2014 2015 2016 2017 2018

C&I Loans by Total Loans

Ranked by American Banker

197154

99

30

10

2Top 200 Banks

with <$1 billion of assets

Provident Bank ranked #2 out of 5,415 institutions

51% increase from 2017-2018

29% Compounded annual growth rate from 2013 – 2018

Banks will be Digital/Branch Hybrids

Digital StrategyCritical for liquidity and funding loan

growth

• Robust online account opening for commercial customers

• Banking services for payroll processors

•Development of deposit specialties (i.e. cryptocurrency deposit services and fintech partnerships)

Office Updates

Portsmouth Executive and Seacoast Lending office, and branch (anticipated August 2019 move in)

Bedford branch expansion

Hampton branch closure

25 Maplewood Ave. Portsmouth, NH

Thank you!

At this time, the floor is open for general questions