Shareholder letter

Dear Shareholders,

As a young man, my aspirations for ABB's future were only about 50% higher than the current level. For example, in the early 90s, our total assets ranged from $50 million to $60 million. I hoped (and imagined) that someday we might grow to $75 million to $80 million in total assets, with net income a respectable 1% of total assets, or $750,000. But reaching even this modest goal seemed unlikely at the time; Mullins was in steady decline, Aynor was a small farming community, and our NMB branch remained stubbornly unprofitable. Our outlook was not promising. I had hope but no plan. Thinking of a bigger future seemed overly optimistic, maybe even foolish.

Today, reflecting over a 46-year career, we can see what happens over time (spoiler alert: it’s more than 50%!), and we’ve learned how to credibly forecast our future growth. It’s not guesswork or faith, it’s math—specifically, extrapolation and compound interest. Simple as that.

To illustrate: In 2015, we had total assets of a “mere” $500 million. Over the next 10 years, we doubled—and more—to about $2.2 billion by growing 16% annually, and organically, for the last decade. No mergers, no acquisitions—just good old-fashioned hard work by the Best Bankers in one of the top markets in the country!

So, where do we go from here? Will we continue growing at 16%? What risks are we facing? Isn’t it enough already?

Let's start with the last one. It’s not about enough or not enough or too much. It’s about who we are. We are a bank of strivers. It’s in our DNA.

Will 16% growth continue for the next 10 years, taking us to $10 billion? I doubt it, but I don’t rule it out either. But whatever the future holds, the past decade of 16% annual growth lifted us out of the pile and ushered in a new era for ABB!

Our objective is to grow 12% annually. This objective is strategic, allowing us to maintain our capital ratios from retained earnings, modestly raise dividends, and strengthen the bank and our holding company. We’re building a strong bank supported by a strong holding company. Additionally, regulations and sound banking require that we reinvest our earnings to maintain our capital ratios as we grow. To be clear, we earn high returns on our capital and reinvest those returns at similarly high returns. For example, in 2025, we retained—meaning we re-invested—about $24 million of earnings in the bank to support our growth, and we expect to earn a 16%+ return on this reinvestment! (Warren Buffett expressed it best, “The best business to own is one that over an extended period can employ large amounts of incremental capital at very high rates of return.”) That’s compounding, baby!

Our 12% annual growth objective presents an obvious and important challenge: How do we do it? Here’s how I see it:

We get 3% growth automatically from inflation, plus we earn another 3% as our “fair share” of the growth in our markets by being diligent. We earn an additional 6% by intentionally applying our Mission, Vision, and Values and leveraging our proprietary advantages — what Warren Buffett (again, with Buffett) would call the moat surrounding our bank. It’s what keeps competitors at bay and customers loyal. To wit:

• Size: We’re a small community bank in a state of even smaller banks. The median bank size in SC is less than $600 million. Our size enables us to serve larger organizations and entrepreneurs working on multiple projects. As for the larger banks, what moves our needle doesn’t move theirs, so we rarely go head-to-head. Plus, our service is concierge-class; theirs is factory-level. It's not a fair match.
• “Closely Held and Closely Managed” (CHCM): Some years ago, the FDIC did a study that determined that CHCM community banks outperformed banks with broad ownership. Here’s why. At the top of every bank’s organizational chart are stockholders, the Board of Directors, board committees, and senior management. Reporting to, seeking guidance, and getting approvals from each of these groups on their schedules is good management, but when it comes to delivering extraordinary customer service, it’s like running a sprint with your pants around your ankles. We’ve turned this to our advantage, improving both our management and customer service. Our shareholders are “boots on the ground,” meaning we’re directors, on committees, and, most importantly, on the senior management team—where the action is, i.e., where problems are solved and opportunities seized. By putting owners to work alongside the Best Bankers, we become a seamless, real-time, customer service, problem-solving, opportunity-seeking machine! Ownership matters!

• “Best Bankers” are the fuel in our rocket. Our experience with Best Bankers dates back to 1998. Back then, in Marion County, customers were “cemented” to their banks for generations. Not only did business not move, the pie was shrinking. Following a merger, Johnny Floyd departed our main competitor and joined us in Mullins, and Rusty Richardson retired from his CPA practice to open our Marion office. Business moved. And how! We now hold 60% of the deposit market share in Marion County, with the remaining split among four other banks. Our Best Bankers have been disrupting markets and driving our growth ever since!
• Our Can-do Culture sets us apart. This is an easy claim to make and a hard one to prove, but here goes. We currently have seven facility expansion projects (new branches, expansions, additions, etc.) ongoing at various stages. We recently closed a large commercial real estate loan 21 days after receiving the request. This is not an exception; it's how we roll! (Grok says 45 to 90 days is typical.) Our proprietary Deposit Task Force, formed in June of 2025, has secured over $100 million in new deposits from the largest and most sophisticated depositors in our geographic market and beyond. You don’t need a branch to bank with us! We’re simultaneously launching three transformational technology upgrades: FedNow, LoanVantage, and RingCentral!

  Our passion for action fuels our progress, defines our culture, and delights our customers!

That is how we’ll grow 12% each year and earn more than our “fair share” in the communities we serve!

FAMILY BUSINESS:

In family business lore, the story of 'shirtsleeves to shirtsleeves in three generations' is well known. Its fate is to be avoided at all costs. It is especially meaningful to us because my brothers and I are the third generation (3Gs) in a family business. I’m happy to report that so far, we’ve avoided the dreaded fate of the third generation. How have we done it?

By thinking like first-generation founders of today's ABB. (Are you listening, 4Gs?)

As Yul Brynner famously said, “So let it be written, so let it be done.” Google it.

Our Vision: “To be the bank where people love to work and do business,” and our Values: Leadership, Teamwork, The Golden Rule, Going the Extra Mile, and Ownership have served us well by providing direction and clarifying who we are. For the 4Gs, here are my thoughts for a Family Business Vision and Values for ABB.

Family Business Vision: To be a blessing to all stakeholders, especially employees.

Family Business Values:

1. Stewardship: Take a biscuit and pass the plate, but more importantly, leave it better than you found it! (Kudos to Scoutmaster Bunny Beeson!)
2. Compounding: Allow time for compounding to do its magic. Your grandchildren will thank you.
3. Gratitude: Appreciate your unearned good fortune.
4. Humility: ……and be humble about it.
5. Gracious: Always be gracious.

Now let’s talk about 2025 results!

It was a good year. We set a new record in Net Income of over $29 million, with asset growth exactly on target at 12%, or about $240 million. Our annual stock valuation rose to $1,000 per share, a 17% increase! (Our first appraisal, 30 years ago, was $23 per share..........just saying.) Financially, we did what we needed to do and a little more.

Managerially, I think we did even better.

We’ve embraced Artificial Intelligence, AI, and it’s already making an impact; its potential in loan collections, fraud detection, compliance, loan underwriting, and more is growing quickly, with broad application, and will soon be ubiquitous.

Our consumer lending, through Dealer Services and our branches, significantly contributes to our performance. Consumer credit—especially non-prime indirect car lending, our specialty—has been in a “Great Recession” since mid-2022, dragging down our earnings. I am pleased to share some encouraging news. As of the first quarter of 2026, our indirect past-due accounts are at their lowest since September 2022! Finally, some green shoots after all our time and effort! Fingers crossed!

Since 2018, we’ve risen from 11th to 2nd place in deposit market share among the 20 banks in Horry County, according to the FDIC’s Annual Summary of Deposits. No other bank has made nearly as much progress as we have. We are the big change in Horry County banking. Our Deposit Task Force, formed in 2025, leverages our competitive advantages and directs our energy and enthusiasm toward becoming the bank of choice for the largest and most sophisticated depositors in our markets. Early results are very encouraging! With this effort, and our strong momentum, we’re sure to take the #1 spot in the Horry County market! Stay tuned!

Leadership expert Max De Pree wrote, “The first responsibility of a leader is to define reality.” Our reality is that Neal, Rusty, and I are in the fourth quarter of our careers, but more importantly, we have a pool of young talent that will “run faster and jump higher” than I ever could. (This obscure reference reflects my advanced age and youthful naivety for the advertising claims of PF Flyers.) Accordingly, in September, we made these important, once-in-a-career appointments:

Chief Officers:

Chief Risk Officer Rusty Richardson

Chief Operating Officer Rivers Anderson

Chief Credit Officer Richard Carroll

Chief Banking Officer Bryan Lenertz

Regional Executive Officers:

Western Horry Bradley Moore

Grand Strand Collier Schettig

Georgetown-ASB Taylor Anderson

Vice Presidents:

Electronic Banking Kendra Jordan

Treasury Services Candace Britton