USCB FINANCIAL HOLDINGS, INC.

Cash flows from operating activities:

$

24,674

$

16,545

Adjustments to reconcile net income to net

cash provided by operating activities:

3,157

2,367

Depreciation and amortization

Accretion of premiums on securities, net

(521)

(770)

Amortization (accretion) of deferred loan fees, net

(184)

2,130

1,012

(Gain) loss on sale of available for sale securities

(14)

1,859

Gain on sale of loans held for sale

(747)

(801)

Increase in cash surrender value of bank owned

life insurance

(1,691)

(2,160)

Decrease in deferred tax asset

7,725

5,251

Net change in operating assets and liabilities:

(257)

(3,142)

(6,223)

Accrued interest and other liabilities

4,610

1,718

Net cash provided by operating activities

34,090

22,546

Cash flows from investing activities:

Purchase of investment securities held to maturity

(86,788)

Proceeds from maturities and pay-downs of investment

securities held to maturity

10,461

101,541

Purchase of investment securities available for

sale

(85,673)

(40,379)

Proceeds from maturities and pay-downs of investment

securities available for sale

20,045

15,189

Proceeds from sales of investment securities available

for sale

34,753

24,185

Net increase in loans held for investment

(134,439)

(239,361)

Purchase of loans held for investment

(66,605)

(45,645)

Additions to premises and equipment

(314)

(163)

Proceeds from the sale of loans held for

sale

9,137

12,530

Purchase of Bank owned life insurance, net

(6,840)

Proceeds from the redemption of Federal Home

Loan Bank stock

11,733

15,495

Purchase of Federal Home Loan Bank stock

(10,959)

(22,766)

Net cash used in investment activities

(211,861)

(273,002)

(Continued)

Cash flows from financing activities:

Proceeds from exercise of Class A common stock

options, net

1,319

Cash dividends paid

(3,939)

(501)

(7,583)

Net increase in deposits

236,865

107,858

Proceeds from Federal Home Loan Bank advances

and other borrowings

227,000

529,350

Repayments on Federal Home Loan Bank advances

and other borrowings

(247,000)

(392,350)

Net cash provided by financing activities

213,744

237,350

Net increase (decrease) in cash and cash equivalents

35,973

(13,106)

Cash and cash equivalents at beginning of period

41,062

54,168

Cash and cash equivalents at end of period

$

77,035

$

41,062

Supplemental disclosure of cash flow information:

Interest paid

$

60,544

$

41,306

Supplemental schedule of non-cash investing and

financing activities:

Transfer of loans held for investment to loans held for

sale

$

8,390

$

11,729

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

$

$

Lease liability arising from obtaining right-of-use asset

$

$

SUMMARY OF SIGNIFICANT ACCOUNTING

POLICIES