USCB FINANCIAL HOLDINGS INC

Cash flows from operating activities:

$

16,545

$

20,141

Adjustments to reconcile net income to net

cash provided by operating activities:

2,367

2,495

Depreciation and amortization

(Accretion) amortization of premiums on securities,

net

(770)

Accretion of deferred loan fees, net

(184)

(1,497)

1,012

Loss on sale of available for sale securities

1,859

2,529

Gain on sale of loans held for sale

(801)

(891)

Increase in cash surrender value of bank owned

life insurance

(2,160)

(1,061)

Decrease in deferred tax asset

5,251

6,945

Net change in operating assets and liabilities:

(3,142)

(1,571)

(3,449)

Accrued interest and other liabilities

1,718

4,252

Net cash provided by operating activities

22,546

29,537

Cash flows from investing activities:

Purchase of investment securities held to maturity

(86,788)

(14,739)

Proceeds from maturities and pay-downs of investment

securities held to maturity

101,541

12,237

Purchase of investment securities available for

sale

(40,379)

(53,113)

Proceeds from maturities and pay-downs of investment

securities available for sale

15,189

40,754

Proceeds from sales of investment securities available

for sale

24,185

60,649

Net increase in loans held for investment

(239,361)

(257,580)

Purchase of loans held for investment

(45,645)

(70,175)

Additions to premises and equipment

(163)

(673)

Proceeds from the sale of loans held for sale

12,530

12,821

Purchase of Bank owned life insurance, net

(6,840)

Proceeds from the redemption of Federal Home

Loan Bank stock

15,495

3,440

Purchase of Federal Home Loan Bank stock

(22,766)

(4,222)

Net cash used in investment activities

(273,002)

(270,601)

(Continued)

Cash flows from financing activities:

Proceeds from exercise of Class A common stock

options, net

Repurchase of Class A common stock

(7,583)

Net increase in deposits

107,858

238,902

Proceeds from Federal Home Loan Bank advances

529,350

126,000

Repayments on Federal Home Loan Bank advances

(392,350)

(116,000)

Net cash provided by financing activities

237,350

249,004

Net increase (decrease) in cash and cash equivalents

(13,106)

7,940

Cash and cash equivalents at beginning of period

54,168

46,228

Cash and cash equivalents at end of period

$

41,062

$

54,168

Supplemental disclosure of cash flow information:

Interest paid

$

41,306

$

7,306

Supplemental schedule of non-cash investing and

financing activities:

Transfer of loans held for investment to loans held for

sale

$

11,729

$

11,930

Transfer of investment securities from available-for-sale to held-to-maturity

$

$

63,798

Lease liability arising from obtaining right-of-use asset

$

$

3,203

SUMMARY OF SIGNIFICANT ACCOUNTING

POLICIES