Net Income Increases 45% to $1.4 Million in the June 2018 Quarter Compared to the June 2017 Quarter

Pre-Provision, Pre-Tax Earnings Increase by 10% (Sequential Quarter)

Net Interest Margin Expands 19 Basis Points to 3.28% in the June 2018 Quarter Compared to the June 2017 Quarter

Non-Performing Assets Decline 27% to $7.0 Million from June 30, 2017

Repurchased 383,585 Shares of Common Stock during the Current Fiscal Year, Approximately 5% of Total Outstanding

RIVERSIDE, Calif., July 30, 2018 (GLOBE NEWSWIRE) -- Provident Financial Holdings, Inc. (“Company”), NASDAQ GS: PROV, the holding company for Provident Savings Bank, F.S.B. (“Bank”), today announced fourth quarter and full year earnings results for the fiscal year ended June 30, 2018.

For the quarter ended June 30, 2018, the Company reported net income of $1.40 million, or $0.18 per diluted share (on 7.59 million average diluted shares outstanding), an increase of 45 percent from net income of $964,000, or $0.12 per diluted share (on 8.00 million average diluted shares outstanding), in the comparable period a year ago. Compared to the same quarter last year, the increase in earnings was primarily attributable to a $1.60 million decrease in salaries and employee benefits expense, the $1.02 million litigation settlement expense recorded in other non-interest expense in the fourth quarter of fiscal 2017 (not replicated in the comparable quarter of fiscal 2018), a $389,000 increase in net interest income and a $312,000 reduction in net loss on the sale and operations of real estate owned acquired in the settlement of loans, partly offset by a $2.77 million decrease in the gain on sale of loans and a $188,000 decrease in the recovery from the allowance for loan losses.

“Our community banking results continue to strengthen and the outlook for our community banking business is favorable. Our net interest margin has expanded significantly in the face of rising interest rates with the balance of core deposits increasing with little impact on deposit costs. The credit quality of our loan portfolio is strong and we are well-capitalized to support our growth goals and capital initiatives,” said Craig G. Blunden, Chairman and Chief Executive Officer of the Company. “However, the continued weakness in mortgage banking fundamentals has resulted in necessary adjustments to our mortgage banking business model. During the 2018 fiscal year, we have reduced our retail production offices by 25%, from 12 to nine and we have reduced our mortgage banking staffing levels by approximately 32%. We will continue to manage and adjust our cost structure to better align our mortgage banking operations with current loan production opportunities,” Mr. Blunden concluded.

Return on average assets for the fourth quarter of fiscal 2018 increased to 0.48 percent from 0.32 percent for the same period of fiscal 2017; and return on average stockholders’ equity for the fourth quarter of fiscal 2018 increased to 4.65 percent from 2.95 percent for the comparable period of fiscal 2017.

On a sequential quarter basis, the $1.40 million net income for the fourth quarter of fiscal 2018 reflects a $333,000, or 19 percent decrease from net income of $1.73 million in the third quarter of fiscal 2018. The decrease in earnings for the fourth quarter of fiscal 2018 compared to the third quarter of fiscal 2018 was primarily attributable to a $556,000 decrease in the gain on sale of loans, a $316,000 decrease in the recovery from the allowance for loan losses and a $203,000 increase in the provision for income taxes, partly offset by a $697,000 decrease in salaries and employees benefits expense and a $183,000 increase in net interest income. Diluted earnings per share for the fourth quarter of fiscal 2018 were $0.18 per share, down 22 percent from the $0.23 per share during the third quarter of fiscal 2018. Return on average assets decreased to 0.48 percent for the fourth quarter of fiscal 2018 from 0.59 percent in the third quarter of fiscal 2018; and return on average stockholders’ equity for the fourth quarter of fiscal 2018 was 4.65 percent, compared to 5.76 percent for the third quarter of fiscal 2018.

For the fiscal year ended June 30, 2018, net income decreased $3.08 million, or 59 percent, to $2.13 million from net income of $5.21 million in the comparable period ended June 30, 2017. The decrease in earnings for the fiscal year ended June 30, 2018 compared to the comparable period ended June 30, 2017 was primarily attributable to an $8.93 million decrease in non-interest income (primarily due to a $9.88 million decrease in the gain on sale of loans) and a $506,000 decrease in the recovery from the allowance for loan losses, partly offset by a $5.58 million decrease in non-interest expense (primarily due to a $6.92 million decrease in salaries and employee benefits expense) and a $562,000 increase in net interest income. Diluted earnings per share for the fiscal year ended June 30, 2018 decreased 56 percent to $0.28 per share (on 7.70 million average diluted shares outstanding) from $0.64 per share (on 8.10 million average diluted shares outstanding) for the last fiscal year.

Net interest income increased $389,000, or four percent, to $9.31 million in the fourth quarter of fiscal 2018 from $8.92 million for the same quarter of fiscal 2017, attributable to an increase in the net interest margin, partly offset by a lower average interest-earning assets balance. The net interest margin during the fourth quarter of fiscal 2018 increased 19 basis points to 3.28 percent from 3.09 percent in the same quarter last year, primarily due to an increase in the average yield of interest-earning assets, partly offset by an increase in the average cost of interest-bearing liabilities. The average yield on interest-earning assets increased by 20 basis points to 3.84 percent in the fourth quarter of fiscal 2018 from 3.64 percent in the same quarter last year and the average cost of interest-bearing liabilities increased by one basis point to 0.63 percent in the fourth quarter of fiscal 2018 from 0.62 percent in the same quarter last year. The average balance of interest-earning assets decreased by $20.2 million, or two percent, to $1.14 billion in the fourth quarter of fiscal 2018 from $1.16 billion in the same quarter last year.

The average balance of loans receivable, including loans held for sale, decreased by $13.0 million, or one percent, to $986.4 million in the fourth quarter of fiscal 2018 from $999.4 million in the same quarter of fiscal 2017, primarily due to a decrease in average loans held for sale attributable to a decrease in mortgage banking activity (primarily due to higher mortgage interest rates and lower refinance volume), partly offset by an increase in average loans held for investment. The average yield on loans receivable increased by 15 basis points to 4.13 percent in the fourth quarter of fiscal 2018 from an average yield of 3.98 percent in the same quarter of fiscal 2017. The increase in the average loan yield was primarily attributable to increases in both the average yield of loans held for investment and the average yield of loans held for sale combined with a lower percentage of loans held for sale to total loans receivable. The average balance of loans held for investment in the fourth quarter of fiscal 2018 was $904.8 million with an average yield of 4.09 percent, up from $890.8 million with an average yield of 3.99 percent in the same quarter of fiscal 2017; while the average balance of loans held for sale in the fourth quarter of fiscal 2018 was $81.6 million with an average yield of 4.56 percent, down from $108.7 million with an average yield of 3.94 percent in the same quarter of fiscal 2017. The outstanding balance of “preferred loans” (multi-family, commercial real estate, construction and commercial business loans) increased by $4.3 million, or one percent, to $589.4 million at June 30, 2018 from $585.1 million at June 30, 2017, net of undisbursed loan funds of $4.3 million and $9.0 million, respectively. The percentage of preferred loans to total loans held for investment at June 30, 2018 increased to 65 percent from 64 percent at June 30, 2017. Loan principal payments received in the fourth quarter of fiscal 2018 were $64.6 million, compared to $45.5 million in the same quarter of fiscal 2017.

The average balance of investment securities increased by $35.9 million, or 56 percent, to $99.8 million in the fourth quarter of fiscal 2018 from $63.9 million in the same quarter of fiscal 2017. The increase was primarily attributable to mortgage-backed securities purchases, partly offset by principal payments received on mortgage-backed securities. The average yield on investment securities increased 17 basis points to 1.55 percent in the fourth quarter of fiscal 2018 from 1.38 percent for the same quarter of fiscal 2017. The increase in the average yield was primarily attributable to mortgage-backed securities purchases which had higher average yields than the existing portfolio and the repricing of variable rate investment securities to higher market interest rates.

In the fourth quarter of fiscal 2018, the Federal Home Loan Bank (“FHLB”) – San Francisco distributed $140,000 of quarterly cash dividends to the Bank, unchanged from the same quarter last year.

The average balance of the Company’s interest-earning deposits, primarily cash with the Federal Reserve Bank of San Francisco, decreased $43.2 million, or 51 percent, to $41.5 million in the fourth quarter of fiscal 2018 from $84.7 million in the same quarter of fiscal 2017. The decrease in interest-earning deposits was primarily due to the purchases of investment securities. The average yield earned on interest-earning deposits in the fourth quarter of fiscal 2018 was 1.84 percent, up 81 basis points from 1.03 percent in the same quarter of fiscal 2017 as a result of the impact of the increases in the federal funds rate over the last year.

Average deposits decreased $18.3 million, or two percent, to $910.0 million in the fourth quarter of fiscal 2018 from $928.3 million in the same quarter of fiscal 2017. The average cost of deposits decreased by one basis point to 0.38 percent in the fourth quarter of fiscal 2018 from 0.39 percent in the same quarter last year, primarily due to a lower percentage of time deposits to total deposits. Transaction account balances or “core deposits” increased $11.4 million, or two percent, to $670.0 million at June 30, 2018 from $658.6 million at June 30, 2017, while time deposits decreased $30.3 million, or 11 percent, to $237.6 million at June 30, 2018 from $267.9 million at June 30, 2017, consistent with the Bank’s strategy to decrease the percentage of time deposits in its deposit base and to increase the percentage of checking and savings accounts.

The average balance of borrowings, which consisted of FHLB – San Francisco advances, increased $6.3 million, or six percent, to $117.7 million and the average cost of FHLB advances decreased six basis points to 2.53 percent in the fourth quarter of fiscal 2018, compared to an average balance of $111.4 million with an average cost of 2.59 percent in the same quarter of fiscal 2017. The decrease in the average cost of advances was primarily due to the maturity of a long-term advance which was renewed at a lower interest rate in the third quarter of fiscal 2018.

During the fourth quarter of fiscal 2018, the Company recorded a recovery from the allowance for loan losses of $189,000, compared to a recovery from the allowance for loan losses of $377,000 recorded during the same period of fiscal 2017 and a recovery from the allowance for loan losses of $505,000 recorded in the third quarter of fiscal 2018 (sequential quarter). The recovery from the allowance for loan losses was primarily attributable to the improving risk profile of the loan portfolio as reflected in the asset quality ratios, net loan recoveries and loan balances shifting to lower risk categories from higher risk categories, in particular a reduction in higher-risk construction loans.

Non-performing assets, with underlying collateral located in California, decreased $2.6 million, or 27 percent, to $7.0 million, or 0.59 percent of total assets, at June 30, 2018, compared to $9.6 million, or 0.80 percent of total assets, at June 30, 2017. Non-performing loans decreased $1.9 million, or 24 percent, to $6.1 million at June 30, 2018 from $8.0 million at June 30, 2017. The non-performing loans at June 30, 2018 are comprised of 21 single-family loans ($6.0 million) and one commercial business loan ($64,000). At June 30, 2018, real estate owned was $906,000, a decline of $709,000, or 44%, from $1.6 million at June 30, 2017 and was comprised of two single-family real estate owned properties acquired during the third and fourth quarters of fiscal 2018.

Net loan recoveries for the quarter ended June 30, 2018 were $43,000 or (0.02) percent (annualized) of average loans receivable, compared to net loan recoveries of $141,000 or (0.06) percent (annualized) of average loans receivable for the quarter ended June 30, 2017 and net loan charge-offs of $39,000 or 0.02 percent (annualized) of average loans receivable for the quarter ended March 31, 2018 (sequential quarter).

Classified assets at June 30, 2018 were $15.8 million, comprised of $7.5 million of loans in the special mention category, $7.4 million of loans in the substandard category and $906,000 in real estate owned; while classified assets at June 30, 2017 were $13.3 million, comprised of $3.7 million of loans in the special mention category, $8.0 million of loans in the substandard category and $1.6 million in real estate owned.

For the quarter ended June 30, 2018, no new loans were restructured from their original terms and classified as restructured loans, while two restructured loans were upgraded to the “pass” category and one restructured loan was downgraded to the “substandard” category. The outstanding restructured loans at June 30, 2018 were $5.2 million, up 44 percent from $3.6 million at June 30, 2017, of which $2.9 million or 56 percent were current at June 30, 2018, with respect to their modified payment terms.

The allowance for loan losses was $7.4 million at June 30, 2018, or 0.81 percent of gross loans held for investment, compared to $8.0 million at June 30, 2017, or 0.88 percent of gross loans held for investment. Management believes that, based on currently available information, the allowance for loan losses is sufficient to absorb potential losses inherent in loans held for investment at June 30, 2018.

Non-interest income decreased by $2.36 million, or 34 percent, to $4.59 million in the fourth quarter of fiscal 2018 from $6.95 million in the same period of fiscal 2017, primarily as a result of a decrease in the gain on sale of loans during the current quarter as compared to the comparable period last year. On a sequential quarter basis, non-interest income decreased $618,000, or 12 percent, primarily as a result of a decrease in the gain on sale of loans and, to a lesser extent, a decline in loan servicing and other fees.

The gain on sale of loans decreased $2.77 million, or 48 percent, to $3.04 million for the quarter ended June 30, 2018 from $5.81 million in the comparable quarter last year, and decreased $556,000 or 15 percent from the quarter ended March 31, 2018 (sequential quarter), reflecting the impact of a lower loan sale volume and a lower average loan sale margin. Total loan sale volume, which includes the net change in commitments to extend credit on loans to be held for sale, was $236.3 million in the quarter ended June 30, 2018, down $145.8 million or 38 percent, from $382.1 million in the comparable quarter last year but increased slightly from $235.5 million in the quarter ended March 31, 2018 (sequential quarter). The average loan sale margin from mortgage banking was 129 basis points for the quarter ended June 30, 2018, a decrease of 21 basis points from 150 basis points in the same quarter last year, and 24 basis points lower than 153 basis points in the third quarter of fiscal 2018 (sequential quarter). The decline in the average loan sale margin was the result of competitive pricing pressure due to recent market conditions consistent with falling demand for mortgages. The gain on sale of loans includes a favorable fair-value adjustment on loans held for sale and derivative financial instruments (commitments to extend credit, commitments to sell loans, commitments to sell mortgage-backed securities, and option contracts) that amounted to a net gain of $85,000 in the fourth quarter of fiscal 2018, compared to a favorable fair-value adjustment that amounted to a net gain of $273,000 in the same period last year and an unfavorable fair-value adjustment that amounted to a net loss of $844,000 in the third quarter of fiscal 2018 (sequential quarter).

In the fourth quarter of fiscal 2018, $241.6 million of loans were originated and purchased for sale, 40 percent lower than the $405.9 million for the same period last year, but 10 percent higher than the $220.2 million during the third quarter of fiscal 2018 (sequential quarter). The loan origination volume has decreased from the previous year as a result of increased mortgage interest rates reducing refinance activity. Total loans sold during the quarter ended June 30, 2018 were $233.9 million, 41 percent lower than the $397.3 million sold during the same quarter last year, but four percent higher than the $225.9 million sold during the third quarter of fiscal 2018 (sequential quarter). Total loan originations (including loans originated and purchased for investment and loans originated and purchased for sale) were $312.4 million in the fourth quarter of fiscal 2018, a decrease of 35 percent from $479.8 million in the same quarter of fiscal 2017, but 16 percent higher than the $269.5 million in the third quarter of fiscal 2018 (sequential quarter).

Non-interest expenses decreased $2.90 million, or 20 percent, to $11.82 million in the fourth quarter of fiscal 2018 from $14.72 million in the same quarter last year. The decrease was primarily due to a $1.60 million decrease in salaries and employee benefits expense and a $1.25 million decrease in other non-interest expense (due mainly to a $1.01 million litigation settlement expense recorded in the fourth quarter of fiscal 2017, which was not replicated this quarter). The decrease in salaries and employee benefits expense was primarily related to lower variable compensation resulting from lower mortgage banking loan originations and staff reductions in mortgage banking. On a sequential quarter basis, non-interest expenses decreased $621,000 or five percent from $12.44 million, primarily as a result of a $697,000 decrease in salaries and employment benefits expense.

The Company’s efficiency ratio in the fourth quarter of fiscal 2018 was 85 percent, an improvement from 93 percent in the same quarter last year and 87 percent in the third quarter of fiscal 2018 (sequential quarter).

The Company’s income tax provision was $870,000 for the fourth quarter of fiscal 2018, up 55 percent from the $560,000 provision for income taxes in the same quarter last year. The increase was primarily attributable to the higher income before taxes, partly offset by the reduction of the federal corporate tax rate resulting from the Tax Cuts and Jobs Act (“Tax Act”). In addition, our 2018 fiscal year required the use of a blended federal corporate tax rate as prescribed by the Internal Revenue Code, which is 28.06% and was applied through June 30, 2018. For the three months ending September 30, 2018 and for the fiscal year ending June 30, 2019, the Company will apply the recently enacted federal corporate tax rate of 21% pursuant to the Tax Act. The Company believes that the tax provision recorded in the fourth quarter of fiscal 2018 reflects its current income tax obligations.

The Company repurchased 39,378 shares of its common stock during the quarter ended June 30, 2018 at an average cost of $18.31 per share. As of June 30, 2018, a total of 383,585 shares under the June 2017 stock repurchase plan have been purchased at an average cost of $19.00 per share and no shares remain available for purchase. On April 26, 2018, the Board of Directors approved the April 2018 stock repurchase plan of up to 373,000 shares, which became available at the expiration of the June 2017 plan.

The Bank currently operates 14 retail/business banking offices in Riverside County and San Bernardino County (Inland Empire). Provident Bank Mortgage operates two wholesale loan production offices and nine retail loan production offices located throughout California.

The Company will host a conference call for institutional investors and bank analysts on Tuesday, July 31, 2018 at 9:00 a.m. (Pacific) to discuss its financial results. The conference call can be accessed by dialing 1-800-230-1059 and requesting the Provident Financial Holdings Earnings Release Conference Call. An audio replay of the conference call will be available through Tuesday, August 7, 2018 by dialing 1-800-475-6701 and referencing access code number 452042.

For more financial information about the Company please visit the website at www.myprovident.com and click on the “Investor Relations” section.

Safe-Harbor Statement

This press release contains statements that the Company believes are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These statements relate to the Company’s financial condition, liquidity, results of operations, plans, objectives, future performance or business. You should not place undue reliance on these statements, as they are subject to risks and uncertainties. When considering these forward-looking statements, you should keep in mind these risks and uncertainties, as well as any cautionary statements the Company may make. Moreover, you should treat these statements as speaking only as of the date they are made and based only on information then actually known to the Company. There are a number of important factors that could cause future results to differ materially from historical performance and these forward-looking statements. Factors which could cause actual results to differ materially from the results anticipated or implied by our forward-looking statements include, but are not limited to increased competitive pressures; changes in the interest rate environment; secondary market conditions for loans and our ability to sell loans in the secondary market; changes in general economic conditions and conditions within the securities markets; legislative and regulatory changes; and other factors described in the Company’s latest Annual Report on Form 10-K and Quarterly Reports on Form 10-Q and other filings with the Securities and Exchange Commission (“SEC”) - which are available on our website at www.myprovident.com and on the SEC’s website at www.sec.gov. We do not undertake and specifically disclaim any obligation to revise any forward-looking statements to reflect the occurrence of anticipated or unanticipated events or circumstances after the date of such statements whether as a result of new information, future events or otherwise. These risks could cause our actual results for fiscal 2019 and beyond to differ materially from those expressed in any forward-looking statements by, or on behalf of us and could negatively affect our operating and stock price performance.

Contacts:Craig G. BlundenChairman andChief Executive Officer

Donavon P. TernesPresident, Chief Operating Officer,and Chief Financial Officer3756 Central AvenueRiverside, CA 92506(951) 686-6060

PROVIDENT FINANCIAL HOLDINGS, INC. Condensed Consolidated Statements of Financial Condition (Unaudited –In Thousands, Except Share Information) June 30, March 31, December September 30, June 30, 31, 2018 2018 2017 2017 2017 -------------------------------------- ------------- ----------- - ----------- - ------------- ----------- - Assets Cash and cash equivalents $ 43,301 $ 50,574 $ 47,173 $ 49,217 $ 72,826 Investment securities – held to maturity, at cost 87,813 95,724 87,626 64,751 60,441 Investment securities - available for sale, at fair value 7,496 8,002 8,405 8,940 9,318 Loans held for investment, net of allowance for loan losses of $7,385; $7,531; $8,075; $8,063 and $8,039, respectively; includes $5,234; $4,996; $5,157; $6,924 and $6,445 at fair value, respectively 902,685 894,167 885,976 908,060 904,919 Loans held for sale, at fair value 96,298 89,823 96,589 127,234 116,548 Accrued interest receivable 3,212 3,100 3,147 2,989 2,915 Real estate owned, net 906 787 621 - 1,615 FHLB – San Francisco stock 8,199 8,108 8,108 8,108 8,108 Premises and equipment, net 8,696 8,734 7,816 7,333 6,641 Prepaid expenses and other assets 16,943 17,583 16,670 17,154 17,302 - Total assets $ 1,175,549 $ 1,176,602 $ 1,162,131 $ 1,193,786 $ 1,200,633 -------------------------------------- - --------- - - --------- - - --------- - - --------- - - --------- - Liabilities and Stockholders’ Equity Liabilities: Non interest-bearing deposits $ 86,174 $ 87,520 $ 77,144 $ 82,415 $ 77,917 Interest-bearing deposits 821,424 834,979 830,644 844,601 848,604 - Total deposits 907,598 922,499 907,788 927,016 926,521 Borrowings 126,163 111,176 111,189 121,206 126,226 Accounts payable, accrued interest and other liabilities 21,331 22,327 22,454 20,643 19,656 - Total liabilities 1,055,092 1,056,002 1,041,431 1,068,865 1,072,403 Stockholders’ equity: Preferred stock, $.01 par value (2,000,000 shares authorized; none issued and outstanding) - - - - - Common stock, $.01 par value (40,000,000 shares authorized; 18,033,115; 18,033,115; 17,976, 615; 17,970,865 and 17,949,365 shares issued, respectively; 7,421,426; 7,460,804; 7,474,776; 7,609,552 and 7,714,052 shares outstanding, 181 180 180 180 180 respectively) Additional paid-in capital 94,957 94,719 94,011 93,669 93,209 Retained earnings 190,616 190,301 189,610 191,451 192,754 Treasury stock at cost (10,611,689; 10,572,311; 10,501,839; 10,361,313 and 10,235,313 shares, respectively) (165,507 ) (164,786 ) (163,311 ) (160,609 ) (158,142 ) Accumulated other comprehensive income, net of tax 210 186 210 230 229 - Total stockholders’ equity 120,457 120,600 120,700 124,921 128,230 - --------- - Total liabilities and stockholders’ $ 1,175,549 $ 1,176,602 $ 1,162,131 $ 1,193,786 $ 1,200,633 equity -------------------------------------- - --------- - - --------- - - --------- - - --------- - - --------- -

PROVIDENT FINANCIAL HOLDINGS, INC. Condensed Consolidated Statements of Operations (Unaudited - In Thousands, Except Earnings Per Share) Quarter Ended Fiscal Year Ended June 30, June 30, -------------------- 2018 2017 2018 2017 ------------------------------------------------------------ - ------- - - ------ --- ---------- ---------- Interest income: Loans receivable, net $ 10,191 $ 9,949 $ 40,016 $ 40,249 Investment securities 386 221 1,344 575 FHLB – San Francisco 140 140 568 967 stock Interest-earning deposits 193 220 784 626 Total interest income 10,910 10,530 42,712 42,417 Interest expense: Checking and money 96 94 407 387 market deposits Savings deposits 150 145 595 579 Time deposits 616 653 2,493 2,842 Borrowings 741 720 2,917 2,871 Total interest expense 1,603 1,612 6,412 6,679 Net interest income 9,307 8,918 36,300 35,738 Recovery from the allowance for loan losses (189 ) (377 ) (536 ) (1,042 ) Net interest income, after recovery from the allowance for loan losses 9,496 9,295 36,836 36,780 Non-interest income: Loan servicing and other 402 312 1,575 1,251 fees Gain on sale of loans, 3,041 5,811 15,802 25,680 net Deposit account fees 496 530 2,119 2,194 Loss on sale and operations of real estate owned acquired in the (5 ) (317 ) (86 ) (557 ) settlement of loans Card and processing 415 388 1,541 1,451 fees Other 243 222 944 802 Total non-interest 4,592 6,946 21,895 30,821 income Non-interest expense: Salaries and employee 8,111 9,709 34,821 41,742 benefits Premises and 1,305 1,296 5,134 5,061 occupancy Equipment 397 393 1,576 1,447 Professional expenses 471 504 1,912 2,075 Sales and marketing 322 353 1,039 1,323 expenses Deposit insurance premiums and regulatory assessments 158 159 749 773 Other 1,054 2,303 7,973 6,364 Total non-interest 11,818 14,717 53,204 58,785 expense Income before taxes 2,270 1,524 5,527 8,816 Provision for income taxes 870 560 3,396 3,609 Net income $ 1,400 $ 964 $ 2,131 $ 5,207 ------------------------------------------------------------ - ------- - - ------ --- - ------ - - ------ - Basic earnings per share $ 0.19 $ 0.12 $ 0.28 $ 0.66 Diluted earnings per share $ 0.18 $ 0.12 $ 0.28 $ 0.64 Cash dividends per share $ 0.14 $ 0.13 $ 0.56 $ 0.52 ------------------------------------------------------------ - ------- - - ------ --- - ------ - - ------ - PROVIDENT FINANCIAL HOLDINGS, INC. Condensed Consolidated Statements of Operations – Sequential Quarters (Unaudited – In Thousands, Except Share Information) Quarter Ended ----------- --- --------------------------------- June 30, March 31, December 31, September 30, 2018 2018 2017 2017 -------------------------------------------------------- ---------- --------- ---- ---------------- --------- Interest income: Loans receivable, net $ 10,191 $ 9,933 $ 9,735 $ 10,157 Investment 386 382 319 257 securities FHLB – San 140 144 143 141 Francisco stock Interest-earning 193 233 168 190 deposits -------------------------------------------------------- - ------ - - ------- ---- - ---------- --- - ----- - Total interest income 10,910 10,692 10,365 10,745 Interest expense: Checking and money market 96 96 112 103 deposits Savings deposits 150 147 149 149 Time deposits 616 613 625 639 Borrowings 741 712 728 736 -------------------------------------------------------- - ------ - - ------- ---- - ---------- --- - ----- - Total interest expense 1,603 1,568 1,614 1,627 -------------------------------------------------------- -------- - --------- ---- ------------ --- ------- - Net interest income 9,307 9,124 8,751 9,118 (Recovery) provision for loan losses (189 ) (505 ) (11 ) 169 -------------------------------------------------------- - ------ - - ------- ---- - ---------- --- - ----- - Net interest income, after (recovery) provision for loan losses 9,496 9,629 8,762 8,949 Non-interest income: Loan servicing 402 493 317 363 and other fees Gain on sale of 3,041 3,597 4,317 4,847 loans, net Deposit account fees 496 529 536 558 Loss on sale and operations of real estate owned acquired in the settlement of loans, net (5 ) (19 ) (22 ) (40 ) Card and 415 372 373 381 processing fees Other 243 238 220 243 -------------------------------------------------------- - ------ - - ------- ---- - ---------- --- - ----- - Total non-interest income 4,592 5,210 5,741 6,352 Non-interest expense: Salaries and employee 8,111 8,808 8,633 9,269 benefits Premises and 1,305 1,255 1,260 1,314 occupancy Equipment 397 442 375 362 Professional 471 400 521 520 expenses Sales and marketing 322 213 301 203 expenses Deposit insurance premiums and regulatory assessments 158 189 218 184 Other 1,054 1,132 1,905 3,882 -------------------------------------------------------- - ------ - - ------- ---- - ---------- --- - ----- - Total non-interest expense 11,818 12,439 13,213 15,734 -------------------------------------------------------- -------- - --------- ---- ------------ --- ------- - Income (loss) before taxes 2,270 2,400 1,290 (433 ) Provision (benefit) for income taxes 870 667 2,067 (208 ) -------------------------------------------------------- - ------ - - ------- ---- - ---------- --- - ----- - Net income (loss) $ 1,400 $ 1,733 $ (777 ) $ (225 ) -------------------------------------------------------- - ------ - - ------- ---- - ---------- --- - ----- - Basic earnings (loss) per share $ 0.19 $ 0.23 $ (0.10 ) $ (0.03 ) Diluted earnings (loss) per share $ 0.18 $ 0.23 $ (0.10 ) $ (0.03 ) Cash dividends per share $ 0.14 $ 0.14 $ 0.14 $ 0.14 -------------------------------------------------------- - ------ - - ------- ---- - ---------- --- - ----- -

PROVIDENT FINANCIAL HOLDINGS, INC. Financial Highlights (Unaudited - Dollars in Thousands, Except Share Information) Quarter Ended Fiscal Year Ended June 30, June 30, ---------------------------- -------------------------- 2018 2017 2018 2017 - --------- - - --------- - - --------- - - --------- SELECTED FINANCIAL RATIOS: Return on average assets 0.48 % 0.32 % 0.18 % 0.43 Return on average stockholders’ equity 4.65 % 2.95 % 1.73 % 3.94 Stockholders’ equity to total assets 10.25 % 10.68 % 10.25 % 10.68 Net interest spread 3.21 % 3.02 % 3.13 % 3.00 Net interest margin 3.28 % 3.09 % 3.19 % 3.06 Efficiency ratio 85.03 % 92.77 % 91.42 % 88.32 Average interest-earning assets to average interest-bearing liabilities 110.53 % 111.19 % 110.66 % 111.16 SELECTED FINANCIAL DATA: Basic earnings per share $ 0.19 $ 0.12 $ 0.28 $ 0.66 Diluted earnings per share $ 0.18 $ 0.12 $ 0.28 $ 0.64 Book value per share $ 16.23 $ 16.62 $ 16.23 $ 16.62 Shares used for basic EPS computation 7,448,037 7,844,839 7,542,071 7,918,454 Shares used for diluted EPS computation 7,594,698 8,002,431 7,700,371 8,098,991 Total shares issued and outstanding 7,421,426 7,714,052 7,421,426 7,714,052 LOANS ORIGINATED AND PURCHASED FOR SALE: Retail originations $ 152,600 $ 227,647 $ 679,504 $ 997,142 Wholesale originations and purchases 89,047 178,229 506,492 915,896 Total loans originated and purchased for sale $ 241,647 $ 405,876 $ 1,185,996 $ 1,913,038 LOANS SOLD: Servicing released $ 228,903 $ 387,914 $ 1,174,618 $ 1,935,349 Servicing retained 4,992 9,355 27,566 38,250 Total loans sold $ 233,895 $ 397,269 $ 1,202,184 $ 1,973,599

As of As of As of As of As of 06/30/18 03/31/18 12/31/17 09/30/17 06/30/17 ASSET QUALITY RATIOS AND DELINQUENT LOANS: Recourse reserve for loans sold $ 283 $ 283 $ 283 $ 305 $ 305 Allowance for loan losses $ 7,385 $ 7,531 $ 8,075 $ 8,063 $ 8,039 Non-performing loans to loans held for investment, net 0.67 % 0.76 % 0.90 % 0.88 % 0.88 % Non-performing assets to total assets 0.59 % 0.64 % 0.74 % 0.67 % 0.80 % Allowance for loan losses to gross loans held for 0.81 % 0.84 % 0.90 % 0.88 % 0.88 % investment Net loan (recoveries) charge-offs to average loans receivable (annualized) (0.02 )% 0.02 % (0.01 )% 0.06 % (0.06 )% Non-performing loans $ 6,057 $ 6,766 $ 7,985 $ 7,991 $ 7,995 Loans 30 to 89 days delinquent $ 805 $ 160 $ 1,537 $ 1,512 $ 1,035

PROVIDENT FINANCIAL HOLDINGS, INC. Financial Highlights (Unaudited - Dollars in Thousands) Quarter Quarter Quarter Quarter Quarter Ended Ended Ended Ended Ended 06/30/18 03/31/18 12/31/17 09/30/17 06/30/17 Recourse recovery for loans sold $ - $ - $ (22 $ - $ (98 ) (Recovery) provision for loan losses $ (189 ) $ (550 $ (11 $ 169 $ (377 ) Net loan (recoveries) charge-offs $ (43 ) $ 39 $ (23 $ 145 $ (141 ) As of As of As of As of As of 06/30/18 03/31/18 12/31/17 09/30/17 06/30/17 REGULATORY CAPITAL RATIOS (BANK): Tier 1 leverage ratio 9.96 % 9.83 9.59 9.54 % 9.90 % Common equity tier 1 capital ratio 16.81 % 16.72 16.44 15.79 % 16.14 % Tier 1 risk-based capital ratio 16.81 % 16.72 16.44 15.79 % 16.14 % Total risk-based capital ratio 17.90 % 17.84 17.65 16.95 % 17.28 % REGULATORY CAPITAL RATIOS (COMPANY): Tier 1 leverage ratio 10.29 % 10.33 10.28 10.55 % 10.77 % Common equity tier 1 capital ratio 17.37 % 17.56 17.62 17.46 % 17.57 % Tier 1 risk-based capital ratio 17.37 % 17.56 17.62 17.46 % 17.57 % Total risk-based capital ratio 18.46 % 18.68 18.83 18.62 % 18.71 % As of June 30, --------------------------------------------------- 2018 2017 --------------------------- - ------------------ - Balance Rate(1) Balance Rate(1) ------------- --- ------- - ---------- -- -------- INVESTMENT SECURITIES: Held to maturity: Certificates of deposit $ 600 1.91 % $ 600 1.13 % U.S. SBA loan pool securities 2,986 2.10 - - U.S. government sponsored enterprise MBS 84,227 2.17 59,841 1.88 - ----------- --- - -------- -- Total investment securities held to maturity $ 87,813 2.17 % $ 60,441 1.87 % Available for sale (at fair value): U.S. government agency MBS $ 4,384 2.95 % $ 5,383 2.21 % U.S. government sponsored enterprise MBS 2,762 3.78 3,474 3.00 Private issue collateralized mortgage obligations 350 3.97 461 3.00 Total investment securities available for sale $ 7,496 3.30 % $ 9,318 2.54 % Total investment securities $ 95,309 2.26 % $ 69,759 1.96 % - ----------- --- - -------- -- (1) The interest rate described in the rate column is the weighted-average interest rate or yield of all instruments, which are included in the balance of the respective line item.

PROVIDENT FINANCIAL HOLDINGS, INC. Financial Highlights (Unaudited - Dollars in Thousands) As of June 30, ------------------------------------------ 2018 2017 - ----------------- --------------------- Balance Rate(1) Balance Rate(1) - ------- - ------- - ------- - ------- - LOANS HELD FOR INVESTMENT: Held to maturity: Single-family (1 to 4 units) $ 314,808 4.34 % $ 322,197 4.01 % Multi-family (5 or more units) 476,008 4.20 479,959 4.11 Commercial real estate 109,726 4.71 97,562 4.65 Construction 7,476 6.65 16,009 6.07 Other 167 6.50 - - Commercial business 500 6.17 576 6.06 Consumer 109 14.71 129 13.54 Total loans held for investment 908,794 4.33 % 916,432 4.17 % Undisbursed loan funds (4,302 ) (9,015 ) Advance payments of escrows 18 61 Deferred loan costs, net 5,560 5,480 Allowance for loan losses (7,385 ) (8,039 ) - ------- - - ------- - Total loans held for investment, net $ 902,685 $ 904,919 - ------- - - ------- - Purchased loans serviced by others included above $ 20,477 3.32 % $ 23,261 3.37 % - ------- - - ------- - (1) The interest rate described in the rate column is the weighted-average interest rate or yield of all instruments, which are included in the balance of the respective line item.

As of June 30, ----------------------------------------- 2018 2017 ------------------ ------------------ Balance Rate(1) Balance Rate(1) --------- ------- --------- ------- DEPOSITS: Checking accounts – non interest-bearing $ 86,174 - % $ 77,917 - % Checking accounts – interest-bearing 259,372 0.11 259,437 0.11 Savings accounts 289,791 0.21 285,967 0.20 Money market accounts 34,633 0.29 35,323 0.27 Time deposits 237,628 1.05 267,877 0.98 - ------- - ------- Total deposits $ 907,598 0.39 % $ 926,521 0.39 % - ------- - ------- BORROWINGS: Overnight $ 15,000 2.08 % $ - - % Three months or less - - 15,000 1.15 Over three to six months - - 11 6.49 Over six months to one year 10,000 1.53 10,000 3.01 Over one year to two years - - 10,000 1.53 Over two years to three years 20,000 3.85 - - Over three years to four years 21,163 2.07 20,000 3.85 Over four years to five years 10,000 2.25 21,215 2.08 Over five years 50,000 2.43 50,000 2.36 - ------- - ------- Total borrowings $ 126,163 2.47 % $ 126,226 2.39 % - ------- - -------

(1) The interest rate described in the rate column is the weighted-average interest rate or cost of all instruments, which are included in the balance of the respective line item.

PROVIDENT FINANCIAL HOLDINGS, INC. Financial Highlights (Unaudited - Dollars in Thousands) Quarter Ended Quarter Ended June 30, 2018 June 30, 2017 -------------------- -------------------- Balance Rate(1) Balance Rate(1) ----------- ------- ----------- ------- SELECTED AVERAGE BALANCE SHEETS: Loans receivable, net (2) $ 986,403 4.13% $ 999,431 3.98% Investment securities 99,779 1.55% 63,861 1.38% FHLB – San Francisco stock 8,180 6.85% 8,105 6.91% Interest-earning deposits 41,488 1.84% 84,667 1.03% Total interest-earning assets $ 1,135,850 3.84% $ 1,156,064 3.64% Total assets $ 1,168,205 $ 1,187,903 Deposits $ 909,961 0.38% $ 928,295 Borrowings 117,651 2.53% 111,397 0.39% Total interest-bearing liabilities $ 1,027,612 0.63% $ 1,039,692 2.59% Total stockholders’ equity $ 120,545 $ 130,882 0.62%

(1) The interest rate described in the rate column is the weighted-average interest rate or yield/cost of all instruments, which are included in the balance of the respective line item.(2) Includes loans held for investment and loans held for sale at fair value, net of the allowance for loan losses.

Fiscal Year Ended Fiscal Year Ended June 30, 2018 June 30, 2017 -------------------- -------------------- Balance Rate(1) Balance Rate(1) ----------- ------- ----------- ------- SELECTED AVERAGE BALANCE SHEETS: Loans receivable, net (2) $ 986,815 4.06% $ 1,025,885 3.92% Investment securities 90,719 1.48% 51,575 1.11% FHLB – San Francisco stock 8,126 6.99% 8,097 11.94% Interest-earning deposits 53,438 1.45% 81,027 0.76% Total interest-earning assets $ 1,139,098 3.75% $ 1,166,584 3.64% Total assets $ 1,172,003 $ 1,198,587 Deposits $ 915,344 0.38% $ 932,132 0.41% Borrowings 113,984 2.56% 117,329 2.45% Total interest-bearing liabilities $ 1,029,328 0.62% $ 1,049,461 0.64% Total stockholders’ equity $ 123,283 $ 132,298

(1) The interest rate described in the rate column is the weighted-average interest rate or yield/cost of all instruments, which are included in the balance of the respective line item.(2) Includes loans held for investment and loans held for sale at fair value, net of the allowance for loan losses.

PROVIDENT FINANCIAL HOLDINGS, INC. Asset Quality (1) (Unaudited – Dollars in Thousands) As of As of As of As of As of 06/30/18 03/31/18 12/31/17 09/30/17 06/30/17 Loans on non-accrual status (excluding restructured loans): Mortgage loans: Single-family $ 2,665 $ 3,616 $ 4,508 $ 4,534 $ 4,668 Commercial real estate - - - - 201 Total 2,665 3,616 4,508 4,534 4,869 Accruing loans past due 90 days or more: - - - - - ----------------------------------------- - ----- - ----- - ----- - ----- - ----- Total - - - - - Restructured loans on non-accrual status: Mortgage loans: Single-family 3,328 3,092 3,416 3,393 3,061 Commercial business loans 64 58 61 64 65 - ----- Total 3,392 3,150 3,477 3,457 3,126 ------------------------------------ ------- ------- ------- ------- ------- Total non-performing loans 6,057 6,766 7,985 7,991 7,995 Real estate owned, net 906 787 621 - 1,615 ----------------------------------------- - ----- - ----- - ----- - ----- - ----- Total non-performing assets $ 6,963 $ 7,553 $ 8,606 $ 7,991 $ 9,610 ----------------------------------------- - ----- - ----- - ----- - ----- - -----

(1) The non-performing loans balances are net of individually evaluated or collectively evaluated allowances, specifically attached to the individual loans and include fair value credit adjustments.