# EDGAR Filing Document

**Accession Number:** 0001413837
**File Stem:** 0001558370-23-000553
**Filing Date:** 2023-1
**Character Count:** 63524
**Document Hash:** 4307c374944e94cad1ea768b34f9fda7
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001558370-23-000553.hdr.sgml**: 20230126

**ACCESSION NUMBER**: 0001558370-23-000553

**CONFORMED SUBMISSION TYPE**: 8-K

**PUBLIC DOCUMENT COUNT**: 16

**CONFORMED PERIOD OF REPORT**: 20230126

**ITEM INFORMATION**: Results of Operations and Financial Condition

**ITEM INFORMATION**: Financial Statements and Exhibits

**FILED AS OF DATE**: 20230126

**DATE AS OF CHANGE**: 20230126

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** First Foundation Inc.
- **CENTRAL INDEX KEY:** 0001413837
- **STANDARD INDUSTRIAL CLASSIFICATION:** STATE COMMERCIAL BANKS [6022]
- **IRS NUMBER:** 000000000
- **STATE OF INCORPORATION:** CA
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 8-K
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 001-36461
- **FILM NUMBER:** 23553881

**BUSINESS ADDRESS:**
- **STREET 1:** 18101 VON KARMAN AVE
- **STREET 2:** SUITE 700
- **CITY:** IRVINE
- **STATE:** CA
- **ZIP:** 92612
- **BUSINESS PHONE:** 949-222-2030

**MAIL ADDRESS:**
- **STREET 1:** 18101 VON KARMAN AVE
- **STREET 2:** SUITE 700
- **CITY:** IRVINE
- **STATE:** CA
- **ZIP:** 92612

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** KELLER FINANCIAL GROUP
- **DATE OF NAME CHANGE:** 20071001

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**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

**Washington, D.C. 20549**

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**FORM 8-K**

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**CURRENT REPORT**

**Pursuant to Section 13 or 15(d) of the**

**Securities Exchange Act of 1934**

**Date of Report (Date of earliest event reported): January 26, 2023**

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**FIRST FOUNDATION INC.**

(Exact name of registrant as specified in its charter)

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| | | |
|:---|:---|:---|
| **Delaware** | **001-36461** | **20-8639702** |
| (State or other jurisdiction<br>of incorporation) | (Commission<br>File Number) | (IRS Employer<br>Identification Number) |

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| | |
|:---|:---|
| **200 Crescent Court, Suite 1400** |  |
| **Dallas, Texas** | **75201** |
| (Address of Principal Executive Offices) | (Zip Code) |

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**(469) 638-9636**

(Registrant's Telephone Number, Including Area Code)

**N/A**

(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

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| | | |
|:---|:---|:---|
| **Title of each class** | **Trading Symbol(s)** | **Name of each exchange on which registered** |
| Common Stock | FFWM | NASDAQ Global Market |

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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

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| | |
|:---|:---|
| **Item 2.02** | **Results of Operations and Financial Condition**  |

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On January 26, 2023, First Foundation Inc. issued an earnings release reporting its consolidated financial results for the quarter and twelve months ended December 31, 2022. A copy of that earnings release is attached as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference.

In accordance with General Instruction B.2 of Form 8-K, the information contained in this Current Report on Form 8-K, including Exhibit 99.1, is being furnished and shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that Section, and such information and that Exhibit shall not be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended.

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| | |
|:---|:---|
| **Item 9.01** | **Financial Statements and Exhibits**  |

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| | |
|:---|:---|
| **Exhibit No.** | **Description** |
| 99.1 | [Earnings Release dated January 26, 2023 announcing the consolidated financial results of First Foundation Inc. for the quarter and twelve months ended December 31, 2022.](ffwm-20230126xex99d1.htm) |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |

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**SIGNATURES**

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

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| | | |
|:---|:---|:---|
| Uly <br>|  |  |
|  | FIRST FOUNDATION INC. | FIRST FOUNDATION INC. |
| Date: January 26, 2023  | By: | /s/ AMY DJOU |
|  |  | Amy Djou |
|  |  | Executive Vice President and<br>Chief Financial Officer |

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## Exhibit 99.1

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| | |
|:---|:---|
| ![Graphic](ffwm-20230126xex99d1002.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;First Foundation Inc.<br>(NASDAQ: FFWM)<br>January 26, 2023 |

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**Exhibit 99.1**

**FIRST FOUNDATION INC. REPORTS FOURTH QUARTER AND FULL YEAR 2022 RESULTS**

● Earnings per share of $0.31 for the quarter, $1.96 for the full year.

● Adjusted earnings per share of $0.35 for the quarter, $2.02 for the full year.

● Net income of $17.4 million for the quarter, $110.5 million for the full year.

● Total revenues of $81.9 million for the quarter, $366.9 million for the full year.

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| | |
|:---|:---|
| &nbsp;&nbsp;**4Q22 Key Financial Data** | **Highlights** |

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| | | | |
|:---|:---|:---|:---|
| **Profitability Metrics** | **4Q22** | **3Q22** | **4Q21** |
| Return on average assets (%) | 0.55 | 0.98 | 1.15 |
| Adjusted return on average assets (%) (a) | 0.63 | 0.99 | 1.16 |
| Return on average common equity (%) | 6.2 | 10.4 | 11.3 |
| Return on tangible common equity (%) (a) | 8.8 | 13.2 | 13.4 |
| Net interest margin (%)  | 2.45 | 3.10 | 3.17 |
| Efficiency ratio (%) (a) | 70.9 | 60.0 | 51.0 |
| **Income Statement (b)**  | **4Q22** | **3Q22** | **4Q21** |
| Net interest income | $74719 | $87672 | $61958 |
| Noninterest income | $7223 | $12184 | $13830 |
| Net income attributable to common | $17354 | $29006 | $23876 |
| Diluted earnings per common share | $0.31 | $0.51 | $0.51 |
| Adjusted diluted earnings per common share (a) | $0.35 | $0.52 | $0.51 |
| Dividends declared per common share | $0.11 | $0.11 | $0.09 |
| **Balance Sheet (b)** | **4Q22** | **3Q22** | **4Q21** |
| Total loans | $10726193 | $10355420 | $7408164 |
| Total deposits | $10362612 | $9549856 | $8811960 |
| Net charge-off ratio | 0.01% | 0.01% | 0.07% |
| Tangible book value per share (a) | $16.20 | $15.96 | $14.92 |
| Tier 1 Leverage Ratio | 8.59% | 8.14% | 8.53% |
| (a) See Non-GAAP Financial Measures  |  |  |  |
| (b) Dollars in thousands, except per share data |  |  |  |

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<br>● Tangible book value per share of $16.20, an increase of $0.24 for the quarter and $1.28 for the full year.<br>● Return on average assets of 0.55% for the quarter and 0.96% for the full year. <br>● Return on average tangible equity of 8.8% for the quarter and 13.0% for the full year.<br>● Quarterly loan originations of $849 million and $5.8 billion for the year; 49% growth year-over-year.<br>● Total deposits of $10.4 billion, an increase of $813 million for the quarter and $1.55 billion for the full year.<br>● Total assets of $13.0 billion; $28% growth year-over-year.<br>

DALLAS, TX – First Foundation Inc. (NASDAQ: FFWM), a financial services company with two wholly-owned operating subsidiaries, First Foundation Advisors ("FFA") and First Foundation Bank ("FFB"), reported earnings per share of $0.31 for the quarter and $1.96 for the full year, and on an adjusted basis $0.35 for the quarter and $2.02 for the full year (see "Use of Non-GAAP Financial Measures" below). Net income was $17.4 million for the quarter and $110.5 million for the year. Total revenues were $81.9 million for the quarter and $366.9 million for the full year. The fourth quarter of 2022 included a $6.25 million valuation adjustment on the NYDIG equity investment, incentive compensation reversal due to recent executive departures, and professional service costs. Additionally, First Foundation Inc. announced today that its Board of Directors has approved the payment of a quarterly cash dividend of $0.11 per common share, payable on February 16, 2023, to common shareholders of record as of February 6, 2023.

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| | |
|:---|:---|
| **Scott F. Kavanaugh President & CEO** | "The earnings that we reported this morning reflect the resilience of our core businesses, and our commitment to managing expenses, strategically slowing loan growth, identifying greater operational efficiencies, while growing the meaningful relationships we have built with our new and existing clients," said Scott F. Kavanaugh, President & CEO of First Foundation, Inc. "Our adjusted earnings per share was $0.35 when accounting for a valuation adjustment on the NYDIG equity investment, recent executive departures, and professional service costs. We generated $81.9 million in revenue and $17.4 million in earnings for the quarter and $366.9 million in revenue and $110.5 million in earnings for the full year, while our adjusted return on average assets ended at 0.63% for the quarter and 1.00% for the full year. Despite the current headwinds the industry faces, First Foundation is well positioned for driving shareholder value and building long-term success." |
| **Chris M. Naghibi COO** | "Let me first note that I am honored to have been selected for the role of Chief Operating Officer. As an organization, we remain committed to creating efficiencies to further benefit all clients and stakeholders," said Chris M. Naghibi, COO of First Foundation, Inc. "Among the many opportunities here at First Foundation, we are focused on building true synergies between our banking and wealth management teams, which have been the cornerstone of our business model. As we actively seek to build strategic alignment across the entire operation, we believe we can enhance the client experience and deliver exceptional service to all the clients who turn to us for their most important financial matters." |

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|:---|:---|
| **Investor contact**: Amy Djou, adjou@ff-inc.com \| 949-299-5461<br>**Media contact**: Shannon Wherry, swherry@ff-inc.com \| 469-638-9642 | ![Graphic](ffwm-20230126xex99d1003.jpg) |

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**FIRST FOUNDATION INC. <br>FOURTH QUARTER AND FULL YEAR 2022 RESULTS**<br>

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| |
|:---|
| &nbsp;&nbsp;**4Q22 Highlights**  |
| &nbsp;&nbsp;Financial Results:  |
| <br>● Total revenues were $81.9 million in the quarter, a decrease of 18% from the third quarter of 2022, and an increase of 8% from the fourth quarter of 2021. The decrease from the third quarter was mostly due to a decrease in net interest income caused primarily by an increase in interest expense. The net interest rate spread on interest earning assets to interest bearing liabilities contracted by 1.00% during the quarter. <br>● Nonperforming assets ("NPAs") to total assets decreased to 0.13%, from 0.14% in the third quarter of 2022.<br>● Return on average tangible equity of 8.8%.<br>● Return on average assets of 0.55%; Adjusted return on average assets of 0.63%<br>● Efficiency ratio of 70.9% for the quarter and 58.6% for the full year 2022, largely impacted by an increase in customer service expense.<br>● Total tangible shareholders' equity of $912 million, tangible book value of $16.20 per share and tangible common equity to tangible assets of 7.13%.<br>● Net interest margin ("NIM") was 2.45% for the quarter.<br>● Advisory and Trust divisions achieved a combined pre-tax profit margin of 32% in the quarter, largely impacted by a decrease in compensation and benefits in the fourth quarter due to the reversal of accruals for incentive compensation.<br>● Repurchased $1.0 million of stock at a price of $13.66. |
| &nbsp;&nbsp;Other Activity:  |
| <br>● Recognized a $6.25 million loss due to a valuation adjustment for a previous equity investment in NYDIG.<br>● Allowance for credit losses for loans increased by $831 thousand in the quarter to $33.7 million, primarily as a result of increased loan balances, offset by the release of specific reserves related to purchase credit deteriorated loans from prior acquisitions.<br>● Loan originations totaled $849 million for the quarter; commercial business originations of $433 million were 51% of the total quarterly originations. <br>● Core deposits constituted 87% of total deposits, with 72% of core deposits attributed to commercial business deposits.<br>● Cost of deposits was 1.47%. <br>● Assets under management ("AUM") at FFA ended the quarter at $5.0 billion, while trust assets under advisement ("AUA") at FFB were $1.3 billion. |

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| | |
|:---|:---|
| &nbsp;&nbsp;**Spotlight**  | &nbsp;&nbsp;**Spotlight**  |
| &nbsp;&nbsp;**Vision List – Outperforming Stock** | &nbsp;&nbsp;**Bank & Thrift Sm-All Stars Class of 2022** |
| &nbsp;&nbsp;&nbsp;First Foundation Inc. made B Riley's Vision List which is a list of the top-24 stocks across all industries selected by analysts to outperform the small-cap benchmark Russell 2000 Index in the current year. Each year analysts are tasked to identify a single, immutable pick to outperform based on a set of defined criteria. | &nbsp;&nbsp;&nbsp;The Sm-All Stars represent the top performing small-cap banks and thrifts in the country. This is the third time FFWM was one of 35 banks chosen. According to Piper Sandler, banks selected have superior performance metrics in growth, profitability, credit quality and capital strength. |
| &nbsp;&nbsp;**CNBC Top 100 Independent Advisors** | &nbsp;&nbsp;**Top Performing Bank with Assets Greater than $10B** |
| &nbsp;&nbsp;&nbsp;First Foundation Advisors was included in The CNBC FA 100, which recognizes the advisory firms that top the list when it comes to offering a comprehensive planning and financial service that helps clients navigate through their complex financial life. | &nbsp;&nbsp;&nbsp;First Foundation Bank ranked as the 6th best performing bank in 2021 with assets greater than $10B. S&P Global Market Intelligence calculated scores for each bank on key metrics, including returns, growth, and efficiency but placed a premium on the strength and risk profile of balance sheets. |

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**FIRST FOUNDATION INC. <br>FOURTH QUARTER AND FULL YEAR 2022 RESULTS**<br>

&nbsp;&nbsp;**Details**<br>

**Loans**

Loans increased $371 million, or 3.6%, compared to the prior quarter, to $10.7 billion as of December 31, 2022, and increased $3.3 billion, or 44.8% compared to December 31, 2021. The increases in loan balances were primarily due to a decreased impact from loan payoffs as loan fundings declined over each period, consistent with our strategy to slow loan growth. Total loan fundings in the fourth quarter of 2022 were $849 million, a decrease of $757 million, or 47.2% from the third quarter of 2022 and a decrease of $364 million, or 30%, from the fourth quarter of 2021. Loan payoffs totaled $478 million during the quarter, compared to payoffs of $672 million in the third quarter of 2022 and $670 million in the fourth quarter of 2021.

Contributing to loan originations during the fourth quarter, our commercial business division funded $433 million of new commercial loans during the quarter, of which 85% were adjustable commercial revolving lines of credit.

**Investment Securities**

Investment securities were $1.1 billion as of December 31, 2022, compared to $1.1 billion as of September 30, 2022, and $1.2 billion as of December 31, 2021.

The allowance for credit losses for investments decreased by $0.08 million from the prior quarter, to $11.4 million as of December 31, 2022, compared to $11.5 million as of September 30, 2022, and increased $1.0 million, compared to $10.4 million as of December 31, 2021. The increase year-over-year was the result of faster than expected prepayments that negatively impacted the projected cash flows on interest-only strip securities.

**Deposits and Borrowings**

Deposits were $10.4 billion as of December 31, 2022, compared to $9.5 billion as of September 30, 2022, and $8.8 billion as of December 31, 2021. Deposit growth during the fourth quarter of 2022 compared to the third quarter of 2022 was primarily driven by increases in wholesale deposits and deposits from our digital banking sector of $1.1 billion and $185.2 million respectively, offset by decreases in the retail, commercial services, and corporate deposit sectors of $215.5 million, $211.5 million and $50.2 million respectively. Noninterest-bearing demand deposits measured 26.4% of total deposits as of December 31, 2022, compared to 37.2% of total deposits as of September 30, 2022, while core deposits decreased by $292 million compared to the third quarter, and measured 86.7% of total deposits as of December 31, 2022, compared to 97.0% of total deposits as of September 30, 2022. Commercial business deposits were 72% of total core deposits as of December 31, 2022.

Our loan to deposit ratio measured 103.5% as of December 31, 2022, compared to 108.4% as of September 30, 2022, and 84.1% as of December 31, 2021.

Borrowings were $1.4 billion as of December 31, 2022, compared to $1.5 billion as of September 30, 2022, and $210.1 million as of December 31, 2021. The increase in borrowings compared to the prior year quarter was primarily due to the addition of $805.0 million in FHLB advances to fund the increase in new loan volume and strategically increase on-balance sheet liquidity.

**Private Wealth Management and Trust Assets**

AUM was $5.0 billion as of December 31, 2022, compared to $4.6 billion as of September 30, 2022. There were $277.0 million of new accounts and $103.8 million of net withdrawals in the fourth quarter of 2022. AUA at FFB's Trust Department was $1.3 billion as of December 31, 2022, and $1.2 billion as of September 30, 2022. The Advisory

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**FIRST FOUNDATION INC. <br>FOURTH QUARTER AND FULL YEAR 2022 RESULTS**<br>

and Trust divisions achieved a combined pre-tax profit margin of 32% in the quarter, largely impacted by a decrease in compensation and benefits in the quarter due to the reversal of accruals for incentive compensation.

**Net Interest Income**

Net interest income decreased in the fourth quarter by $13.0 million, from $87.7 million in the third quarter of 2022, to $74.7 million in the fourth quarter of 2022, and increased by $12.7 million, from $62.0 million in the fourth quarter of 2021. Interest income from loans increased 13% to $115.0 million for the fourth quarter of 2022 compared to $101.0 million in the third quarter of 2022 and increased 96.5% compared to $58.5 million for the fourth quarter of 2021. Loan interest income increases were driven by increases in both average loan balances and interest rates. Interest income from investment securities and interest-earning cash was $11.0 million for the fourth quarter of 2022, compared to $7.8 million for the third quarter of 2022, and $6.2 million in the fourth quarter of 2021. The increase in the fourth quarter compared to prior periods was largely driven by increases in both the average cash balances and interest rates earned on such balances at the Federal Reserve.

Interest expense increased 143.4% to $51.3 million in the fourth quarter of 2022, compared to $21.1 million in the third quarter of 2022, and increased from $2.7 million in the fourth quarter of 2021. The fourth quarter increase in interest expense was driven primarily by a 134.4% increase in interest expense on deposits and a 169.1% increase in interest expense on borrowings. Interest expense on deposits and borrowings increased due to increases in deposit rates, and interest rates on borrowings, as the average rate on FHLB advances and other borrowings increased to 3.79% in the fourth quarter of 2022, from 2.61% in the third quarter of 2022.

**Net Interest Margin** 

Net interest margin ("NIM") was 2.45% in the fourth quarter of 2022, compared to 3.10% in the third quarter of 2022, and 3.15% in the fourth quarter of 2021. The NIM decrease in the fourth quarter was primarily driven by an increase in the yield on interest bearing liabilities, which increased to 2.52% in the fourth quarter of 2022, from 1.23% in the third quarter of 2022, offset partially by an increase in the yield on interest earning assets, which increased to 4.12% in the fourth quarter of 2022, from 3.84% in the third quarter of 2022. The average balance in interest-bearing liabilities also increased by 19.0% compared to the third quarter, offset partially by an 8.0% increase in the average balance in interest earning assets in the same period.

**Noninterest Income**

Noninterest income was $7.2 million in the fourth quarter of 2022, compared to $12.2 million in the third quarter of 2022 and $13.8 million in the fourth quarter of 2021. The decrease in the fourth quarter was largely attributable to a $6.25 million loss due to a valuation adjustment for an equity investment in NYDIG.

Noninterest income during the fourth quarter of 2022, excluding the $6.25 million loss, totaled $13.5 million and was comprised of $6.5 million of investment advisory fees from Wealth Management, $3.2 million of trust administrative and consulting fees, $2.5 million of loan and servicing fees, $0.6 million of deposit account fees and other income of $0.7 million.

**Noninterest Expense**

Noninterest expense decreased to $59.8 million for the fourth quarter of 2022, compared to $60.3 million for the third quarter of 2022, and increased 51.2%, compared to $39.6 million for the fourth quarter of 2021. Compensation and benefits were $23.2 million in the fourth quarter of 2022, compared to $29.5 million in the third quarter of 2022, and $22.9 million in the fourth quarter of 2021. The decrease in compensation and benefits in the fourth quarter of 2022 was primarily due to the reversal of accruals for incentive compensation for several

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**FIRST FOUNDATION INC. <br>FOURTH QUARTER AND FULL YEAR 2022 RESULTS**<br>

executive management personnel who separated from the company during the quarter. Additionally, headcount decreased slightly to 713 FTEs in the fourth quarter of 2022 compared to 718 FTEs in the third quarter of 2022. Customer service costs increased to $18.2 million in the fourth quarter of 2022, from $13.6 million in the third quarter of 2022 and $2.1 million in the fourth quarter of 2021. The increase in customer service costs were due to increases in the earnings credit rates paid on the related deposit balances. Deferred loan costs decreased in the fourth quarter of 2022, compared to the third quarter of 2022, as these costs are a direct offset to compensation expense. The decrease in deferred loan costs were due to the fourth quarter decrease in loan originations.

Our efficiency ratio for the fourth quarter of 2022 was 70.9%, compared to 60.0% for the third quarter of 2022 and 51.0% in the fourth quarter of 2021. The fourth quarter increase in the efficiency ratio was impacted by an increase in customer service expense. The efficiency ratio for the fourth quarter of 2022 excludes the negative $6.25 million valuation adjustment on the NYDIG equity investment included in other income.

**Income Tax Expense**

We recorded income tax expense of $3.6 million in the fourth quarter of 2022, compared to income tax expense of $10.5 million in the third quarter of 2022, and income tax expense of $8.5 million in the fourth quarter of 2021. Our effective tax rate for the fourth quarter of 2022 was 17.1%, compared to 26.6% for the third quarter of 2022, and 26.2% for the fourth quarter of 2021. Our annual effective tax rates for 2022 and 2021 were 26.2%, and 27.9% respectively. The decrease was predominantly due to a decrease in pretax income, a decrease in our statutory state tax rate, an increase in public finance lending and an increase in low-income housing tax credit investments. The decrease reflects our ongoing efforts to lower the effective tax rate.

**Asset Quality**

Total nonperforming assets were $16.5 million as of December 31, 2022, compared to $17.5 million as of September 31, 2022, and $14.5 million as of December 31, 2021. Our ratio of nonperforming assets to total assets was 0.13% as of December 31, 2022, compared to 0.14% as of September 30, 2022, and December 31, 2021.. Total delinquent loans were $20.8 million as of December 31, 2022, compared to $5.8 million as of September 30, 2022, and $5.3 million as of December 31, 2021.

Our allowance for credit losses for loans was $33.7 million, or 0.31% of total loans held for investment, as of December 31, 2022, compared to $32.9 million, or 0.32%, as of September 30, 2022, and $33.8 million, or 0.49%, as of December 31, 2021. The fourth quarter increase in the allowance for credit losses for loans of $831 thousand was primarily the result of increased loan balances, offset by the release of specific reserves related to purchase credit deteriorated loans from prior acquisitions. Net charge-offs during the fourth quarter of 2022 were $268 thousand, compared to net charge-offs of $169 thousand for the third quarter of 2022, and $1.1 million of net charge-offs for the fourth quarter of 2021.

The ratio of the allowance for credit losses for loans to total past due and nonaccrual loans was 108.5% as of December 31, 2022, compared to 192.6% as of September 30, 2022, and 247.3% as of December 31, 2021.

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**FIRST FOUNDATION INC. <br>FOURTH QUARTER AND FULL YEAR 2022 RESULTS**<br>

**Capital**

As of December 31, 2022, FFB exceeded all Basel III minimum regulatory capital requirements necessary to be considered a well-capitalized depository institution, as summarized in the table below:

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| | | | | |
|:---|:---|:---|:---|:---|
| | **As of** | **As of** | **As of** | |
| <br>(unaudited) | **December 31,** <br>**2022** | **September 30,** <br>**2022** | **December 31,** <br>**2021** | **Well-Capitalized**<br>**Regulatory**<br>**Requirements** |
| Tier 1 leverage ratio | 8.59% | 8.14% | 8.53% | 5.00% |
| Common Equity Tier 1 ratio | 10.60% | 10.27% | 11.45% | 6.50% |
| Tier 1 risk-based capital ratio | 10.60% | 10.27% | 11.45% | 8.00% |
| Total risk-based capital ratio | 11.01% | 10.68% | 12.01% | 10.00% |
| Tangible common equity to tangible assets ratio <sup>2</sup> | 7.13% | 7.43% | 8.44% | N/A% |

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&nbsp;&nbsp;&nbsp;&nbsp;(1) Regulatory capital ratios are preliminary and subject to change until filing of our December 31, 2022, FDIC call report.

&nbsp;&nbsp;&nbsp;&nbsp;(2) Tangible common equity is a First Foundation Inc. ("FFI") non-GAAP financial measure. See disclosures regarding "Use of Non-GAAP Financial Measures" included as a separate section in this report.

Shareholders' equity totaled $1.13 billion as of December 31, 2022, an increase of $12.4 million and $70.4 million from September 30, 2022, and December 30, 2021, respectively. Our tangible book value per common share was $16.20 as of December 31, 2022, compared to $15.96 as of September 30, 2022, and $14.92 as of December 31, 2021. The fourth quarter increase in tangible book value per common share was attributable to positive EPS of $0.31 during the quarter, offset by $0.11 dividends per share.

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**FIRST FOUNDATION INC. <br>FOURTH QUARTER AND FULL YEAR 2022 RESULTS**<br>

**Earnings Call Info**<br>

The Company will host a conference call at 8:00 a.m. PT / 11:00 a.m. ET on January 26, 2023, to discuss its financial results. Analysts and investors may participate in the question-and-answer session. The call will be broadcast live over the Internet and can be accessed by visiting First Foundation's website and clicking on "Investor Relations" and "Events & Presentations" https://investor.ff-inc.com/events-and-presentations/default.aspx. The conference call can be accessed by telephone at (800) 267-6316 using conference ID FFWMQ422. It is recommended that participants dial into the conference call approximately ten minutes prior to the call. For those who are unable to participate during the live call, an archive of the call will be available for replay.

**About First Foundation**

First Foundation Inc. (NASDAQ: FFWM) and its subsidiaries offer personal banking, business banking, and private wealth management services, including investment, trust, insurance, and philanthropy services. This comprehensive platform of financial services is designed to help clients at any stage in their financial journey. The broad range of financial products and services offered by First Foundation are more consistent with those offered by larger financial institutions, while its high level of personalized service, accessibility, and responsiveness to clients is more aligned with community banks and boutique wealth management firms. This combination of an integrated platform of comprehensive financial products and personalized service differentiates First Foundation from many of its competitors and has contributed to the growth of its client base and business. Learn more at firstfoundationinc.com, or connect with us on LinkedIn and Twitter.

**Forward-Looking Statements**

This report includes forward-looking statements within the meaning of the "Safe-Harbor" provisions of the Private Securities Litigation Reform Act of 1995, including forward-looking statements regarding our expectations and beliefs about our future financial performance and financial condition, as well as trends in our business and markets. Forward-looking statements often include words such as "believe," "expect," "anticipate," "intend," "plan," "estimate," "project," "outlook," or words of similar meaning, or future or conditional verbs such as "will," "would," "should," "could," or "may." The forward-looking statements in this report are based on current information and on assumptions that we make about future events and circumstances that are subject to a number of risks and uncertainties that are often difficult to predict and beyond our control. As a result of those risks and uncertainties, our actual financial results in the future could differ, possibly materially, from those expressed in or implied by the forward-looking statements contained in this report and could cause us to make changes to our future plans. Those risks and uncertainties include, but are not limited to, the risk of incurring credit losses, which is an inherent risk of the banking business; the negative impacts and disruptions resulting from the COVID-19 pandemic on our colleagues, clients, the communities we serve and the domestic and global economy, which may have an adverse effect on our business, financial position and results of operations; the risk that we will not be able to continue our internal growth rate; the performance of loans currently on deferral following the expiration of the respective deferral periods; the risk that we will not be able to access the securitization market on favorable terms or at all; changes in general economic conditions, either nationally or locally in the areas in which we conduct or will conduct our business; risks associated with changes in interest rates, which could adversely affect our interest income and interest rate margins and, therefore, our future operating results; the risk that the performance of our investment management business or of the equity and bond markets could lead clients to move their funds from or close their investment accounts with us, which would reduce our assets under management and adversely affect our operating results; the risk that we may be unable or that our board of directors may determine that it is inadvisable to pay future dividends at historic levels or at all; risks associated with changes in income tax laws and regulations; and risks associated with seeking new client relationships and maintaining existing client relationships.

Page 7 of 19

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**FIRST FOUNDATION INC. <br>FOURTH QUARTER AND FULL YEAR 2022 RESULTS**<br>

Additional information regarding these and other risks and uncertainties to which our business and future financial performance are subject is contained in our 2021 Annual Report on Form 10-K for the fiscal year ended December 31, 2021, that we filed with the SEC on February 28, 2022, and other documents we file with the SEC from time to time. We urge readers of this report to review those reports and other documents we file with the SEC from time to time. Also, our actual financial results in the future may differ from those currently expected due to additional risks and uncertainties of which we are not currently aware or which we do not currently view as, but in the future may become, material to our business or operating results. Due to these and other possible uncertainties and risks, readers are cautioned not to place undue reliance on the forward-looking statements contained in this report, which speak only as of today's date, or to make predictions based solely on historical financial performance. We also disclaim any obligation to update forward-looking statements contained in this report or in the above-referenced reports, whether as a result of new information, future events or otherwise, except as may be required by law or NASDAQ rules.

---

| | |
|:---|:---|
| &nbsp;&nbsp;**Contacts** |  |
| &nbsp;&nbsp;**Investors** | **Media** |
| &nbsp;&nbsp;Amy Djou<br>EVP, Chief Financial Officer<br>949-299-5461<br>adjou@ff-inc.com | Shannon Wherry<br>VP, Director of Corporate Communications<br>469-638-9642<br>swherry@ff-inc.com |

---

Page 8 of 19

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**FIRST FOUNDATION INC. <br>FOURTH QUARTER AND FULL YEAR 2022 RESULTS**<br>

**CONSOLIDATED BALANCE SHEETS**

(unaudited)

---

| | | | |
|:---|:---|:---|:---|
| (in thousands, except share and per share amounts) | **December 31,**  | **September 30,**  | **December 31,**  |
|  | **2022** | **2022** | **2021** |
| **ASSETS** |  |  |  |
| Cash and cash equivalents | $656494 | $317818 | $1121757 |
| Securities available-for-sale ("AFS") | 237597 | 238982 | 1201777 |
| Securities held-to-maturity ("HTM") | 862544 | 884061 | - |
| Allowance for credit losses - investments | (11439) | (11519) | (10399) |
| &nbsp;&nbsp;Net securities | 1088702 | 1111524 | 1191378 |
| Loans held for sale | - | - | 501436 |
|  |  |  | - |
| Loans held for investment | 10726193 | 10355420 | 6906728 |
| Allowance for credit losses - loans | (33731) | (32900) | (33776) |
| &nbsp;&nbsp;Net loans | 10692462 | 10322520 | 6872952 |
| Investment in FHLB stock | 25358 | 31203 | 18249 |
| Deferred taxes | 24198 | 24210 | 20835 |
| Premises and equipment, net | 36140 | 36607 | 37920 |
| Real estate owned ("REO") | 6210 | 6210 | 6210 |
| Goodwill and intangibles | 221835 | 222290 | 222125 |
| Other assets | 262780 | 256481 | 203342 |
| &nbsp;&nbsp;Total Assets | $13014179 | $12328863 | $10196204 |
| **LIABILITIES AND SHAREHOLDERS' EQUITY** |  |  |  |
| Liabilities: |  |  |  |
| &nbsp;&nbsp;Deposits | $10362612 | $9549856 | $8811960 |
| &nbsp;&nbsp;Borrowings | 1369936 | 1496456 | 210127 |
| &nbsp;&nbsp;Accounts payable and other liabilities | 147253 | 160586 | 110066 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total Liabilities | 11879801 | 11206898 | 9132153 |
| Shareholders' Equity: |  |  |  |
| &nbsp;&nbsp;Common Stock | 56 | 56 | 56 |
| &nbsp;&nbsp;Additional paid-in-capital | 719606 | 719955 | 720744 |
| &nbsp;&nbsp;Retained earnings | 426659 | 415507 | 340976 |
| &nbsp;&nbsp;Accumulated other comprehensive income (loss) | (11943) | (13553) | 2275 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total Shareholders' Equity | 1134378 | 1121965 | 1064051 |
| Total Liabilities and Shareholders' Equity | $13014179 | $12328863 | $10196204 |

---

Page 9 of 19

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**FIRST FOUNDATION INC. <br>FOURTH QUARTER AND FULL YEAR 2022 RESULTS**<br>

**CONSOLIDATED INCOME STATEMENTS**

(unaudited)

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **For the Quarter Ended** | **For the Quarter Ended** | **For the Quarter Ended** | **For the Year Ended**  | **For the Year Ended**  |
| (in thousands, except share and  | **December 31,**  | **September 30,**  | **December 31,**  | **December 31,**  | **December 31,**  |
| per share amounts) | **2022** | **2022** | **2021** | **2022** | **2021** |
| Interest income: |  |  |  |  |  |
| &nbsp;&nbsp;Loans | $115041 | $100978 | $58532 | $370078 | $224823 |
| &nbsp;&nbsp;Securities | 6678 | 6752 | 5696 | 26411 | 20435 |
| &nbsp;&nbsp;Cash, FHLB Stock, and Fed Funds | 4298 | 1016 | 460 | 7389 | 1960 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total interest income | 126017 | 108746 | 64688 | 403878 | 247218 |
| Interest expense: |  |  |  |  |  |
| &nbsp;&nbsp;Deposits | 36552 | 15595 | 2690 | 61845 | 13453 |
| &nbsp;&nbsp;Borrowings | 14746 | 5479 | 40 | 23343 | 481 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total interest expense | 51298 | 21074 | 2730 | 85188 | 13934 |
| Net interest income | 74719 | 87672 | 61958 | 318690 | 233284 |
| Provision for credit losses | 1173 | (22) | 3879 | 532 | 3866 |
| Net interest income after provision for credit losses | 73546 | 87694 | 58079 | 318158 | 229418 |
| Noninterest income: |  |  |  |  |  |
| &nbsp;&nbsp;Asset management, consulting and other fees | 9722 | 8975 | 9612 | 38787 | 36022 |
| &nbsp;&nbsp;Gain on sale of loans | - | - | - | - | 21459 |
| &nbsp;&nbsp;Other income (loss) | (2499) | 3209 | 4218 | 9447 | 12972 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total noninterest income | 7223 | 12184 | 13830 | 48234 | 70453 |
| Noninterest expense: |  |  |  |  |  |
| &nbsp;&nbsp;Compensation and benefits | 23236 | 29531 | 22938 | 110222 | 87908 |
| &nbsp;&nbsp;Occupancy and depreciation | 9261 | 9594 | 6680 | 36236 | 24977 |
| &nbsp;&nbsp;Professional services and marketing costs | 4174 | 3039 | 3495 | 13660 | 12224 |
| &nbsp;&nbsp;Customer service costs | 18219 | 13560 | 2140 | 38178 | 8775 |
| &nbsp;&nbsp;Other expenses | 4934 | 4618 | 4311 | 18293 | 14202 |
| &nbsp;&nbsp;&nbsp;&nbsp;Total noninterest expense | 59824 | 60342 | 39564 | 216589 | 148086 |
| Income before taxes on income | 20945 | 39536 | 32345 | 149803 | 151785 |
| Taxes on income | 3591 | 10530 | 8469 | 39291 | 42274 |
| &nbsp;&nbsp;Net income | $17354 | $29006 | $23876 | $110512 | $109511 |
| Net income per share: |  |  |  |  |  |
| &nbsp;&nbsp;Basic | $0.31 | $0.51 | $0.51 | $1.96 | $2.42 |
| &nbsp;&nbsp;Diluted | $0.31 | $0.51 | $0.51 | $1.96 | $2.41 |
| &nbsp;&nbsp;Shares used in computation: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Basic | 56366499 | 56387451 | 46751414 | 56422450 | 45272183 |
| &nbsp;&nbsp;&nbsp;&nbsp;Diluted | 56433461 | 56447901 | 46881088 | 56490060 | 45459540 |

---

Page 10 of 19

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**FIRST FOUNDATION INC. <br>FOURTH QUARTER AND FULL YEAR 2022 RESULTS**<br>

**SELECTED CONSOLIDATED FINANCIAL DATA AND ASSET QUALITY**

(unaudited)

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **For the Quarter Ended** | **For the Quarter Ended** | **For the Quarter Ended** | **For the Year Ended**  | **For the Year Ended**  |
| (in thousands, except share and per share amounts  | **December 31,**  | **September 30,**  | **December 31,**  | **December 31,**  | **December 31,**  |
| and percentages) | **2022** | **2022** | **2021** | **2022** | **2021** |
| **Selected Financial Data:** |  |  |  |  |  |
| &nbsp;&nbsp;Return on average assets | 0.55% | 0.98% | 1.15% | 0.96% | 1.41% |
| &nbsp;&nbsp;Return on average equity | 6.2% | 10.4% | 11.3% | 10.0% | 14.4% |
| &nbsp;&nbsp;Return on average tangible equity <sup>(1)</sup> | 8.8% | 13.2% | 13.4% | 13.0% | 16.9% |
| &nbsp;&nbsp;Efficiency ratio <sup>(2)</sup> | 70.9% | 60.0% | 51.0% | 58.6% | 47.5% |
| &nbsp;&nbsp;Net interest margin | 2.45% | 3.10% | 3.17% | 2.91% | 3.15% |
| &nbsp;&nbsp;Cost of deposits | 1.47% | 0.64% | 0.15% | 0.65% | 0.20% |
| &nbsp;&nbsp;Loan to deposit ratio | 103.5% | 108.4% | 84.1% | 103.5% | 84.1% |
| &nbsp;&nbsp;Noninterest income as a % of total revenues | 8.8% | 12.2% | 18.2% | 13.1% | 23.2% |
| &nbsp;&nbsp;Loan originations | $848664 | $1606074 | $1213136 | $5846541 | $3913059 |
| &nbsp;&nbsp;Assets under management | 4985277 | 4625840 | 5680605 | 4985277 | 5680605 |
| &nbsp;&nbsp;Tangible common equity to tangible assets <sup>(1)</sup> | 7.13% | 7.43% | 8.44% | 7.13% | 8.44% |
| &nbsp;&nbsp;Book value per share | $20.14 | $19.90 | $18.86 | $20.14 | $18.86 |
| &nbsp;&nbsp;Tangible book value per share <sup>(1)</sup> | 16.20 | 15.96 | 14.92 | 16.20 | 14.92 |
| **Asset Quality:** |  |  |  |  |  |
| &nbsp;&nbsp;Nonperforming assets |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Nonaccrual loans | $10331 | $11240 | $8330 | $10331 | $8330 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other real estate owned | 6210 | 6210 | 6210 | 6210 | 6210 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total nonperforming loans | $16541 | $17450 | $14540 | $16541 | $14540 |
| &nbsp;&nbsp;Loans 30 - 89 days past due | $18561 | $5846 | $3965 | $18561 | $3965 |
| &nbsp;&nbsp;Accruing loans 90 days or more past due | 2195 | 1138 |  | 2195 |  |
| &nbsp;&nbsp;Nonperforming assets to total assets | 0.13% | 0.14% | 0.14% | 0.13% | 0.14% |
| &nbsp;&nbsp;Loans 30 - 89 days past due to total loans | 0.17% | 0.05% | 0.06% | 0.17% | 0.06% |
| &nbsp;&nbsp;Allowance for credit losses to loans held for investment | 0.31% | 0.32% | 0.49% | 0.31% | 0.49% |
| &nbsp;&nbsp;Allowance for credit losses to past due and nonaccrual loans | 108.5% | 192.6% | 247.3% | 108.5% | 247.3% |
| &nbsp;&nbsp;Net charge-offs (recoveries) to average loans - annualized | 0.01% | 0.01% | 0.07% | 0.00% | (0.01)% |

---

------

&nbsp;&nbsp;&nbsp;&nbsp;(1) Tangible equity is a non-GAAP financial measure. See disclosures regarding "Use of Non-GAAP Financial Measures" included as a separate section in this report.

&nbsp;&nbsp;&nbsp;&nbsp;(2) Efficiency Ratio is a non-GAAP financial measure: See disclosures regarding "Use of Non-GAAP Financial Measures" included as a separate section in this report.

Page 11 of 19

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**FIRST FOUNDATION INC. <br>FOURTH QUARTER AND FULL YEAR 2022 RESULTS**<br>

**SEGMENT REPORTING**

(unaudited)

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **For the Quarter Ended** | **For the Quarter Ended** | **For the Quarter Ended** | **For the Year Ended**  | **For the Year Ended**  |
|  | **December 31,**  | **September 30,**  | **December 31,**  | **December 31,**  | **December 31,**  |
| (in thousands) | **2022** | **2022** | **2021** | **2022** | **2021** |
| **Banking:** |  |  |  |  |  |
| &nbsp;&nbsp;Interest income | $126017 | $108746 | $64688 | $403878 | $247218 |
| &nbsp;&nbsp;Interest expense | 49596 | 19281 | 2700 | 78766 | 13688 |
| &nbsp;&nbsp;&nbsp;&nbsp;Net interest income | 76421 | 89465 | 61988 | 325112 | 233530 |
| Provision for credit losses | 1173 | (22) | 3879 | 532 | 3866 |
| &nbsp;&nbsp;Noninterest income | 7030 | 5730 | 5358 | 26148 | 41068 |
| &nbsp;&nbsp;Noninterest expense | 52915 | 53571 | 32440 | 188619 | 121375 |
| &nbsp;&nbsp;&nbsp;&nbsp;Income before taxes on income | $29363 | $41646 | $31027 | $162109 | $149357 |
| **Wealth Management:** |  |  |  |  |  |
| &nbsp;&nbsp;Noninterest income | $6837 | $6865 | $7897 | $30027 | $29917 |
| &nbsp;&nbsp;Noninterest expense | 5158 | 6380 | 5908 | 24371 | 23349 |
| &nbsp;&nbsp;&nbsp;&nbsp;Income before taxes on income | $1679 | $485 | $1989 | $5656 | $6568 |
| **Other and Eliminations:** |  |  |  |  |  |
| &nbsp;&nbsp;Interest income | $— | $— | $— | $— | $— |
| &nbsp;&nbsp;Interest expense | 1702 | 1793 | 30 | 6422 | 246 |
| &nbsp;&nbsp;&nbsp;&nbsp;Net interest income | (1702) | (1793) | (30) | (6422) | (246) |
| &nbsp;&nbsp;Noninterest income | (6644) | (411) | 575 | (7941) | (532) |
| &nbsp;&nbsp;Noninterest expense | 1751 | 391 | 1216 | 3599 | 3362 |
| &nbsp;&nbsp;&nbsp;&nbsp;Income before taxes on income | $(10097) | $(2595) | $(671) | $(17962) | $(4140) |

---

Page 12 of 19

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**FIRST FOUNDATION INC. <br>FOURTH QUARTER AND FULL YEAR 2022 RESULTS**<br>

**LOAN AND DEPOSIT BALANCES**

(unaudited)

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **December 31,**  | **September 30,**  | **June 30,**  | **March 31,**  | **December 31,**  |
| (in thousands) | **2022** | **2022** | **2022** | **2022** | **2021** |
| **Loans:** |  |  |  |  |  |
| Outstanding principal balance: |  |  |  |  |  |
| &nbsp;&nbsp;Loans secured by real estate: |  |  |  |  |  |
| &nbsp;&nbsp;Residential properties: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Multifamily | $5341596 | $5088695 | $3953717 | $3284003 | $2886055 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Single Family | 1016498 | 989258 | 958348 | 911438 | 933445 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Subtotal | 6358094 | 6077953 | 4912065 | 4195441 | 3819500 |
| &nbsp;&nbsp;Commercial properties | 1203292 | 1236577 | 1237664 | 1264221 | 1309200 |
| &nbsp;&nbsp;Land and construction | 158565 | 144787 | 170887 | 159533 | 156028 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total real estate loans | 7719951 | 7459317 | 6320616 | 5619195 | 5284728 |
| &nbsp;&nbsp;Commercial and industrial loans | 2984748 | 2874827 | 2593948 | 1754279 | 1598422 |
| &nbsp;&nbsp;Consumer loans | 4481 | 5155 | 10845 | 9760 | 10834 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total loans | 10709180 | 10339299 | 8925409 | 7383234 | 6893984 |
| &nbsp;&nbsp;Premiums, discounts and deferred fees and expenses | 17013 | 16121 | 13432 | 14230 | 12744 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total | $10726193 | $10355420 | $8938841 | $7397464 | $6906728 |
| &nbsp;&nbsp;Loans held for sale | $— | $— | $485296 | $501424 | $501436 |
| **Deposits:** |  |  |  |  |  |
| Demand deposits: |  |  |  |  |  |
| &nbsp;&nbsp;Noninterest-bearing | $2736691 | $3550637 | $3587375 | $3296118 | $3280455 |
| &nbsp;&nbsp;Interest-bearing | 2568850 | 2253799 | 2425847 | 2429202 | 2242684 |
| &nbsp;&nbsp;Money market and savings | 3178230 | 2911909 | 2869719 | 2592437 | 2620336 |
| &nbsp;&nbsp;Certificates of deposit | 1878841 | 833511 | 655803 | 639761 | 668485 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total | $10362612 | $9549856 | $9538744 | $8957518 | $8811960 |

---

Page 13 of 19

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**FIRST FOUNDATION INC. <br>FOURTH QUARTER AND FULL YEAR 2022 RESULTS**<br>

**CONSOLIDATED LOAN FUNDING AND YIELDS**

(unaudited)

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **For the Quarter Ended** | **For the Quarter Ended** | **For the Quarter Ended** | **For the Year Ended**  | **For the Year Ended**  |
|  | **December 31,**  | **September 30,**  | **December 31,**  | **December 31,**  | **December 31,**  |
| (in thousands, except percentages) | **2022** | **2022** | **2021** | **2022** | **2021** |
| **Loan Funding Balances:** |  |  |  |  |  |
| &nbsp;&nbsp;Loans secured by real estate: |  |  |  |  |  |
| &nbsp;&nbsp;Residential properties: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Multifamily | $293660 | $742126 | $579414 | $2396767 | $1983858 |
| &nbsp;&nbsp;&nbsp;&nbsp;Single family | 57343 | 96229 | 74992 | 305316 | 257715 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Subtotal | 351003 | 838355 | 654406 | 2702083 | 2241573 |
| &nbsp;&nbsp;Commercial properties: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Non-owner occupied CRE | 38796 | 57707 | 28770 | 185045 | 41836 |
| &nbsp;&nbsp;&nbsp;&nbsp;Owner-occupied CRE | 11534 | 28644 | 31715 | 88385 | 75575 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Subtotal | 50330 | 86351 | 60485 | 273430 | 117411 |
| &nbsp;&nbsp;Land and construction | 26137 | 21538 | 11994 | 106427 | 23156 |
| &nbsp;&nbsp;Total real estate loans | 427470 | 946244 | 726885 | 3081940 | 2382140 |
| &nbsp;&nbsp;Commercial and industrial loans | 420971 | 659562 | 486120 | 2762730 | 1527869 |
| &nbsp;&nbsp;Consumer loans | 223 | 268 | 131 | 1871 | 3050 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total | $848664 | $1606074 | $1213136 | $5846541 | $3913059 |
| **Loan Funding Yields:** |  |  |  |  |  |
| &nbsp;&nbsp;Loans secured by real estate: |  |  |  |  |  |
| &nbsp;&nbsp;Residential properties: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Multifamily | 4.70% | 4.34% | 3.20% | 3.89% | 3.26% |
| &nbsp;&nbsp;&nbsp;&nbsp;Single family | 5.10% | 3.98% | 3.26% | 3.86% | 3.28% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Subtotal | 4.77% | 4.29% | 3.21% | 3.89% | 3.26% |
| &nbsp;&nbsp;Commercial properties: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Non-owner occupied CRE | 4.85% | 4.84% | 3.20% | 4.28% | 3.51% |
| &nbsp;&nbsp;&nbsp;&nbsp;Owner-occupied CRE | 6.51% | 4.58% | 3.78% | 4.70% | 3.81% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Subtotal | 5.23% | 4.75% | 3.51% | 4.42% | 3.70% |
| &nbsp;&nbsp;Land and construction | 6.11% | 4.99% | 4.71% | 5.00% | 4.96% |
| &nbsp;&nbsp;Total real estate loans | 4.90% | 4.35% | 3.26% | 3.98% | 3.30% |
| &nbsp;&nbsp;Commercial and industrial loans | 6.54% | 5.02% | 3.56% | 4.44% | 3.51% |
| &nbsp;&nbsp;Consumer loans | 5.32% | 5.45% | 3.92% | 4.51% | 3.96% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total | 5.72% | 4.63% | 3.38% | 4.19% | 3.38% |

---

Page 14 of 19

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**FIRST FOUNDATION INC. <br>FOURTH QUARTER AND FULL YEAR 2022 RESULTS**<br>

**CONSOLIDATED AVERAGE BALANCE SHEET, INTEREST, YIELD AND RATES**

(unaudited)

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **For the Quarter Ended** | **For the Quarter Ended** | **For the Quarter Ended** | **For the Year Ended**  | **For the Year Ended**  |
|  | **December 31,**  | **September 30,**  | **December 31,**  | **December 31,**  | **December 31,**  |
| (in thousands, except percentages) | **2022** | **2022** | **2021** | **2022** | **2021** |
| **Average Balances:** |  |  |  |  |  |
| &nbsp;&nbsp;FHLB stock, fed funds, and deposits | $501983 | $229798 | $659730 | $625351 | $756658 |
| &nbsp;&nbsp;Securities AFS | 253921 | 258654 | 994701 | 413220 | 806456 |
| &nbsp;&nbsp;Securities HTM | 868945 | 898932 |  | 760489 |  |
| &nbsp;&nbsp;Loans | 10578819 | 9910051 | 6150095 | 9139349 | 5846315 |
| &nbsp;&nbsp;Total interest-earnings assets | 12203668 | 11297435 | 7804526 | 10938409 | 7409429 |
| &nbsp;&nbsp;Deposits: interest-bearing | 6535439 | 5955016 | 4076354 | 5969054 | 4039247 |
| &nbsp;&nbsp;Deposits: noninterest-bearing | 3357771 | 3742460 | 3076209 | 3474657 | 2725631 |
| &nbsp;&nbsp;Borrowings | 1543623 | 833171 | 32808 | 754938 | 63681 |
| **Average Yield / Rate:** |  |  |  |  |  |
| &nbsp;&nbsp;FHLB stock, fed funds, and deposits | 3.40% | 1.75% | 0.28% | 1.18% | 0.26% |
| &nbsp;&nbsp;Securities AFS | 3.42% | 3.19% | 2.29% | 2.71% | 2.53% |
| &nbsp;&nbsp;Securities HTM | 2.08% | 2.09% | —% | 2.00% | —% |
| &nbsp;&nbsp;Loans | 4.34% | 4.07% | 3.80% | 4.05% | 3.85% |
| &nbsp;&nbsp;Total interest-earnings assets | 4.12% | 3.84% | 3.31% | 3.69% | 3.34% |
| &nbsp;&nbsp;Deposits (interest-bearing only) | 2.22% | 1.04% | 0.26% | 1.04% | 0.33% |
| &nbsp;&nbsp;Deposits (noninterest and interest-bearing) | 1.47% | 0.64% | 0.15% | 0.65% | 0.20% |
| &nbsp;&nbsp;Borrowings | 3.79% | 2.61% | 0.48% | 3.09% | 0.75% |
| &nbsp;&nbsp;Total interest-bearing liabilities | 2.52% | 1.23% | 0.26% | 1.27% | 0.34% |
| Net Interest Rate Spread | 1.60% | 2.61% | 3.05% | 2.42% | 3.00% |
| Net Interest Margin | 2.45% | 3.10% | 3.17% | 2.91% | 3.15% |

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**FIRST FOUNDATION INC. <br>FOURTH QUARTER AND FULL YEAR 2022 RESULTS**<br>

**Use of Non-GAAP Financial Measures**

To supplement our unaudited condensed consolidated financial statements presented in accordance with GAAP, we use certain non-GAAP measures (including, but not limited to, non-GAAP net income and non-GAAP financial ratios) of financial performance. These supplemental performance measures may vary from, and may not be comparable to, similarly titled measures by other companies in our industry. Non-GAAP financial measures are not in accordance with, or an alternative for, GAAP. Generally, a non-GAAP financial measure is a numerical measure of a company's performance that either excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with GAAP. A non-GAAP financial measure may also be a financial metric that is not required by GAAP or other applicable requirement.

We believe that these non-GAAP financial measures, when taken together with the corresponding GAAP financial measures (as applicable), provide meaningful supplemental information regarding our performance by providing additional information used by management that is not otherwise required by GAAP or other applicable requirements. Our management uses, and believes that investors benefit from referring to, these non-GAAP financial measures in assessing our operating results and when planning, forecasting and analyzing future periods. These non-GAAP financial measures also facilitate a comparison of our performance to prior periods. We believe these measures are frequently used by securities analysts, investors and other interested parties in the evaluation of companies in our industry. However, these non-GAAP financial measures should be considered in addition to, not as a substitute for or superior to, net income or other financial measures prepared in accordance with GAAP. In the information below, we have provided a reconciliation of, where applicable, the most comparable GAAP financial measures to the non-GAAP financial measures used in this report, or a reconciliation of the non-GAAP calculation of the financial measure.

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**FIRST FOUNDATION INC. <br>FOURTH QUARTER AND FULL YEAR 2022 RESULTS**<br>

**NON-GAAP RETURN ON AVERAGE TANGIBLE COMMON EQUITY (ROATCE); ADJUSTED RETURN ON AVERAGE ASSETS; AND ADJUSTED NET INCOME**

(unaudited)

Return on average tangible common equity was calculated by excluding average goodwill and intangibles assets from the average shareholders' equity during the associated periods. Adjusted net income available to common shareholders includes various adjustments to net income and the associated tax effect of those adjustments during the associated periods. Adjusted return on average assets represents adjusted net income available to common shareholders divided by average total assets.

The table below provides a reconciliation of the GAAP measure of return on average equity to the non-GAAP measure of return on average tangible common equity. The table below also provides a reconciliation of the GAAP measure of return on average assets to the non-GAAP measure of adjusted return on average assets:

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| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **For the Quarter Ended** | **For the Quarter Ended** | **For the Quarter Ended** | **For the Year Ended**  | **For the Year Ended**  | **For the Year Ended**  | **For the Year Ended**  |
|  | **December 31,**  | **September 30,**  | **December 31,**  | **December 31,**  | **December 31,**  | **December 31,**  | **December 31,**  |
| (in thousands, except percentages) | **2022** | **2022** | **2021** | **2022** | **2022** | **2021** | **2021** |
| &nbsp;&nbsp;Average shareholders' equity | $1128276 | $1113948 | $844089 | $| 1100684 | $| 759101 |
| &nbsp;&nbsp;Less: Average goodwill and intangible assets | 222062 | 222519 | 126002 |  | 222393 |  | 104355 |
| &nbsp;&nbsp;Average tangible common equity | $906214 | $891429 | $718087 | $| 878291 | $| 654746 |
| &nbsp;&nbsp;Average assets | $12728499 | $11821923 | $8313123 | $| 11456932 | $| 7733279 |
| &nbsp;&nbsp;Net Income | $17354 | $29006 | $23876 | $| 110512 | $| 109511 |
| &nbsp;&nbsp;Adjustments: |  |  |  |  |  |  |  |
| &nbsp;&nbsp; Plus: Amortization of intangible assets expense | 454 | 459 | 365 |  | 1914 |  | 1579 |
| &nbsp;&nbsp; Plus: Valuation loss on equity investment | 6250 |  |  |  | 6250 |  |  |
| &nbsp;&nbsp; Less: Incentive compensation reversal | (4150) |  |  |  | (4150) |  |  |
| &nbsp;&nbsp; Less: Merger related costs |  |  |  |  | (36) |  |  |
| &nbsp;&nbsp; Plus: Professional service costs | 971 |  |  |  | 971 |  |  |
| &nbsp;&nbsp;Total Adjustments | 3525 | 459 | 365 |  | 4949 |  | 1579 |
| &nbsp;&nbsp;Less: Tax impact of adjustments above | (987) | (143) | (106) |  | (1400) |  | (458) |
| &nbsp;&nbsp;Total adjustments to net income | 2538 | 316 | 259 |  | 3549 |  | 1121 |
| &nbsp;&nbsp;Adjusted net income available to common shareholders | $19892 | $29322 | $24135 | $| 114061 | $| 110632 |
| &nbsp;&nbsp;Tax rate utilized for calculating tax effect on adjustments to net income | 28.0% | 29.0% | 29.0% |  | 28.0% |  | 29.0% |
| &nbsp;&nbsp;Return on average equity<sup>(1)</sup> | 6.2% | 10.4% | 11.3% |  | 10.0% |  | 14.4% |
| &nbsp;&nbsp;Return on average tangible common equity<sup>(2)</sup> <sup>(5)</sup> | 8.8% | 13.2% | 13.4% |  | 13.0% |  | 16.9% |
| &nbsp;&nbsp;Return on average assets <sup>(3)</sup> | 0.55% | 0.98% | 1.15% |  | 0.96% |  | 1.42% |
| &nbsp;&nbsp;Adjusted return on average assets <sup>(4)</sup> <sup>(5)</sup> | 0.63% | 0.99% | 1.16% |  | 1.00% |  | 1.43% |

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&nbsp;&nbsp;&nbsp;&nbsp;(1) Annualized net income divided by average shareholders' equity.

&nbsp;&nbsp;&nbsp;&nbsp;(2) Annualized adjusted net income available to common shareholders divided by average tangible common equity.

&nbsp;&nbsp;&nbsp;&nbsp;(3) Annualized net income divided by average assets.

&nbsp;&nbsp;&nbsp;&nbsp;(4) Annualized adjusted net income divided by average assets.

&nbsp;&nbsp;&nbsp;&nbsp;(5) Non-GAAP measure.

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**FIRST FOUNDATION INC. <br>FOURTH QUARTER AND FULL YEAR 2022 RESULTS**<br>

**NON-GAAP EFFICIENCY RATIO**

(unaudited)

Efficiency ratio is a non-GAAP financial measurement determined by methods other than in accordance with U.S. GAAP. This figure represents the ratio of adjusted noninterest expense to adjusted revenue.

The table below provides a calculation of the non-GAAP measure of efficiency ratio:

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **For the Quarter Ended** | **For the Quarter Ended** | **For the Quarter Ended** | **For the Year Ended**  | **For the Year Ended**  |
|  | **December 31,**  | **September 30,**  | **December 31,**  | **December 31,**  | **December 31,**  |
| (in thousands, except percentages) | **2022** | **2022** | **2021** | **2022** | **2021** |
| &nbsp;&nbsp;Total noninterest expense | $59824 | $60342 | $39564 | $216589 | $148086 |
| &nbsp;&nbsp;Less: Amortization of intangible assets expense | (454) | (459) | (365) | (1914) | (1579) |
| &nbsp;&nbsp;(Less)/Add: Merger related costs | - | - | (1056) | 36 | (2606) |
| &nbsp;&nbsp;Less: Professional service costs | (971) | - | - | (971) | - |
| &nbsp;&nbsp;Add: incentive compensation reversal | 4150 | - | - | 4150 | - |
| &nbsp;&nbsp;Adjusted Noninterest expense | $62549 | $59883 | $38143 | $217890 | $143901 |
| &nbsp;&nbsp;Net interest income | $74719 | $87672 | $61958 | $318690 | $233284 |
| &nbsp;&nbsp;Plus: Total noninterest income | 7223 | 12184 | 13830 | 48234 | 70453 |
| &nbsp;&nbsp;Plus: Valuation loss on equity investment | 6250 | - | - | 6250 | - |
| &nbsp;&nbsp;Less: Net gain on other equity investments | - | - | (1069) | - | (1069) |
| &nbsp;&nbsp;Less: Net gain on sale-leaseback | - | - | - | (1111) | - |
| &nbsp;&nbsp;Adjusted Revenue | $88192 | $99856 | $74719 | $372063 | $302668 |
| &nbsp;&nbsp;Efficiency Ratio | 70.9% | 60.0% | 51.0% | 58.6% | 47.5% |

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**FIRST FOUNDATION INC. <br>FOURTH QUARTER AND FULL YEAR 2022 RESULTS**<br>

**NON-GAAP TANGIBLE COMMON EQUITY RATIO, TANGIBLE BOOK VALUE PER SHARE, AND ADJUSTED EARNINGS PER SHARE (BASIC AND DILUTED)** 

(unaudited)

Tangible common equity ratio, tangible book value per share, and adjusted earnings per share are non-GAAP financial measurements determined by methods other than in accordance with U.S. GAAP. Tangible common equity ratio is calculated by taking tangible common equity which is shareholders' equity excluding the balance of goodwill and intangible assets and dividing by tangible assets which is total assets excluding the balance of goodwill and intangible assets. Tangible book value per share is calculated by dividing tangible common equity by basic common shares outstanding, as compared to book value per share, which is calculated by dividing shareholders' equity by basic common shares outstanding. Adjusted earnings per share (basic and diluted) is calculated by dividing adjusted net income available to common shareholders by average common shares outstanding (basic and diluted). The reconciliation of GAAP net income to adjusted net income available to common shareholders is presented on page 17 in "Non-GAAP Return on Average Tangible Common Equity (ROATCE); Adjusted Return on Average Assets and Adjusted Net Income."

The table below provides a reconciliation of the GAAP measure of equity to asset ratio to the non-GAAP measure of tangible common equity ratio and the GAAP measure of book value per share to the non-GAAP measure of tangible book value per share:

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| | | | |
|:---|:---|:---|:---|
|  | **December 31,**  | **September 30,**  | **December 31,**  |
| (in thousands, except per share amounts) | **2022** | **2022** | **2021** |
| &nbsp;&nbsp;Shareholders' equity | $1134378 | $1121965 | $1064051 |
| &nbsp;&nbsp;Less: Goodwill and intangible assets | 221835 | 222290 | 222125 |
| &nbsp;&nbsp;Tangible Common Equity | $912543 | $899675 | $841926 |
| &nbsp;&nbsp;Total assets | $13014179 | $12328863 | $10196204 |
| &nbsp;&nbsp;Less: Goodwill and intangible assets | 221835 | 222290 | 222125 |
| &nbsp;&nbsp;Tangible assets | $12792344 | $12106573 | $9974079 |
| &nbsp;&nbsp;Equity to Asset Ratio | 8.72% | 9.10% | 10.44% |
| &nbsp;&nbsp;Tangible Common Equity Ratio | 7.13% | 7.43% | 8.44% |
| &nbsp;&nbsp;Book value per share | $20.14 | $19.90 | $18.86 |
| &nbsp;&nbsp;Tangible book value per share | 16.20 | 15.96 | 14.92 |
| &nbsp;&nbsp;Basic common shares outstanding | 56325242 | 56387671 | 56432070 |
| &nbsp;&nbsp;Adjusted net income available to common shareholders  | $19892 | $29322 | $24135 |
| &nbsp;&nbsp;Average basic common shares outstanding | 56366499 | 56387451 | 46751427 |
| &nbsp;&nbsp;Average diluted common shares outstanding | 56433461 | 56447901 | 46881101 |
| &nbsp;&nbsp;Earnings per share (basic) | $0.31 | $0.51 | $0.51 |
| &nbsp;&nbsp;Earnings per share (diluted) | $0.31 | $0.51 | $0.51 |
| &nbsp;&nbsp;Adjusted earnings per share (basic) | $0.35 | $0.52 | $0.52 |
| &nbsp;&nbsp;Adjusted earnings per share (diluted) | $0.35 | $0.52 | $0.51 |

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