First Business Bank Announces First Quarter 2026 Financial Results
MADISON, Wis.--( BUSINESS WIRE)--First Business Financial Services, Inc. (the “Company”, the “Bank”, or “First Business Bank”) (Nasdaq: FBIZ) reported quarterly net income available to common shareholders of $12.0 million, or earnings per share ("EPS") of $1.44. This compares to net income available to common shareholders of $13.1 million, or $1.58 per share, in the fourth quarter of 2025 and $11.0 million, or $1.32 per share, in the first quarter of 2025.
"Our strong first quarter performance underscores the effectiveness of First Business Bank’s strategy,” said Corey Chambas, Chief Executive Officer. “We delivered broad-based growth, with loans and core deposits increasing 15% and 18%, respectively, exhibiting our team's success in driving exceptional levels of new client acquisition. Our higher-yielding C&I lending portfolios accounted for two-thirds of the late-quarter loan growth and should provide meaningful support to net interest margin going forward. Growth in non-interest income further reinforced the benefits of our diversified revenue model. Additionally, we made progress toward resolving our largest non-performing CRE credit, contributing to an 8% decline in non-accrual loans during the quarter. Our momentum in the first quarter positions us to achieve our full-year target of 10% growth and above-average shareholder returns while maintaining disciplined risk management."
Quarterly Highlights
Quarterly Financial Results
(Unaudited)
As of and for the Three Months Ended
(Dollars in thousands, except per share amounts)
March 31,
2026
December 31,
2025
March 31,
2025
Net interest income
$35,518
$34,762
$33,258
Adjusted non-interest income (1)
8,775
7,461
7,579
Operating revenue (1)
44,293
42,223
40,837
Operating expense (1)
27,081
23,901
24,617
Pre-tax, pre-provision adjusted earnings (1)
17,212
18,322
16,220
Less:
Provision for credit losses
2,960
1,855
2,659
Loss on repossessed assets
—
—
(8)
SBA recourse benefit
(121)
—
—
(Recovery) impairment of tax credit investments
(7)
229
110
Income before income tax expense
14,380
16,238
13,459
Income tax expense
2,180
2,905
2,288
Net income
$12,200
$13,333
$11,171
Preferred stock dividends
219
219
219
Net income available to common shareholders
$11,981
$13,114
$10,952
Earnings per share, diluted
$1.44
$1.58
$1.32
Book value per share
$44.12
$43.19
$39.04
Tangible book value per share (1)
$42.68
$41.75
$37.58
Net interest margin (2)
3.56%
3.53%
3.69%
Fee income ratio (non-interest income / total revenue)
19.81%
17.67%
18.56%
Efficiency ratio (1)
61.14%
56.61%
60.28%
Return on average assets (2)
1.13%
1.25%
1.14%
Return on average tangible common equity (2)
13.55%
14.83%
14.12%
Period-end loans and leases receivable
$3,498,903
$3,373,241
$3,184,400
Average loans and leases receivable
$3,425,751
$3,363,752
$3,185,796
Period-end core deposits
$2,796,059
$2,673,003
$2,462,695
Average core deposits
$2,848,601
$2,765,730
$2,362,894
Allowance for credit losses, including unfunded commitment reserves
$38,489
$37,692
$36,515
Non-performing assets
$40,503
$43,855
$24,092
Allowance for credit losses as a percent of total gross loans and leases
1.10%
1.12%
1.15%
Non-performing assets as a percent of total assets
0.94%
1.07%
0.61%
First Quarter 2026 Compared to Fourth Quarter 2025
Net interest income increased $756,000, or 2.2%, to $35.5 million.
The Bank reported provision for credit losses of $3.0 million compared to $1.9 million in the linked quarter. The current quarter provision primarily reflects net charge-offs and loan growth, partially offset by a decrease in general reserve qualitative factors. See the Provision for Credit Loss breakdown table below for more detail.
Non-interest income increased $1.3 million, or 17.6%, to $8.8 million.
Non-interest expense increased $2.8 million, or 11.7%, to $27.0 million, while operating expense increased $3.2 million, or 13.3%, to $27.1 million.
Income tax expense decreased $725,000 to $2.2 million. The effective tax rate was 15.2% for the three months ended March 31, 2026, compared to 17.9% for the linked quarter. The change in tax expense reflects updated tax credit partnership estimates and timing of stock compensation vesting activity. The Company expects to report an effective tax rate between 16% and 18% for 2026.
Total period-end loans and leases receivable increased $125.9 million, or 14.9% annualized, to $3.501 billion. The average rate earned on average loans and leases receivable was 6.57%, down 20 basis points from 6.77% in the prior quarter. Excluding the non-accrual interest activity in both periods, the average rate earned on average loans and leases was 6.57% compared to 6.87% in the prior quarter.
Total period-end core deposits increased $123.1 million, or 18.4% annualized, to $2.796 billion. The average rate paid was 2.41%, down 23 basis points from 2.64% in the prior quarter primarily due to a decrease in short-term market rates.
Period-end wholesale funding, including FHLB advances and brokered deposits, increased $113.9 million, or 12.6%, to $1.019 billion, driven primarily by liquidity management considerations. The increase also supported interest rate risk management through match-funding of fixed-rate assets to enhance funding flexibility and help stabilize net interest margin.
Non-performing assets decreased $3.4 million to $40.5 million, or 0.94% of total assets, compared to 1.07% in the prior quarter. The decline was primarily due to the sale at par of a land development CRE non-accrual loan within a previously identified Southeast Wisconsin-based client relationship.
The allowance for credit losses, including the unfunded credit commitments reserve, increased $797,000, or 2.1%, primarily due to increases in general reserves due to loan growth, an increase in specific reserves, and a decline in the economic outlook in our model forecast, partially offset by a decrease in qualitative risk factors. The allowance for credit losses, including unfunded credit commitment reserves, as a percent of total gross loans and leases was 1.10% compared to 1.12% in the prior quarter.
First Quarter 2026 Compared to First Quarter 2025
Net interest income increased $2.3 million, or 6.8%, to $35.5 million.
The Company reported provision for credit losses of $3.0 million, compared to $2.7 million in the first quarter of 2025. See the Provision for Credit Loss breakdown table below for more detail.
Non-interest income increased $1.2 million, or 15.8%, to $8.8 million.
Non-interest expense increased $2.2 million, or 9.0%, to $27.0 million. Operating expense increased $2.5 million or 10.0%, to $27.1 million.
Total period-end loans and leases receivable increased $315.9 million, or 9.9%, to $3.501 billion. The average yield decreased 37 basis points to 6.57%, primarily due to a decrease in short-term market rates.
Total period-end core deposits grew $333.4 million, or 13.5%, to $2.796 billion. The average rate paid decreased 30 basis points to 2.41%, reflecting a decrease in short-term market rates.
Period-end wholesale funding increased $6.3 million, or 0.6%, to $1.019 billion.
Non-performing assets increased to $40.5 million, or 0.94% of total assets, from $24.1 million, or 0.61% of total assets, primarily reflecting the fourth quarter 2025 downgrade of $20.4 million of CRE loans from a single client relationship. The increase was partially offset by a $3.4 million sale at par in the first quarter of 2026 related to that same relationship, as well as lower non-accrual balances from equipment finance loans and SBA loans.
The allowance for credit losses, including unfunded commitment reserves, increased $2.0 million to $38.5 million primarily due to higher general reserves as a result of loan growth and quantitative factors, partially offset by lower specific reserves. The allowance for credit losses as a percent of total gross loans and leases was 1.10%, compared with 1.15% in the prior year.
Dividend Announced
On April 23, 2026, the Company's Board of Directors declared a quarterly cash dividend on its common stock of $0.34 per share, which is equivalent to a dividend yield of 2.37% based on the market close price of $57.27 on Wednesday, April 22, 2026. The quarterly dividend is the same as the quarterly dividend declared in January 2026, and based on first quarter 2026 earnings per share, this represents a dividend payout ratio of 24%. This regular cash dividend is payable on May 20, 2026, to shareholders of record at the close of business on May 6, 2026.
The Board of Directors also declared a dividend on the Company’s 7% Series A Preferred Stock of $17.50 per share, payable on June 15, 2026, to shareholders of record on May 29, 2026.
2026 CEO Succession Plan
On April 15, 2026, the Board of Directors of First Business Financial Services, Inc. (the “Company”) appointed David R. Seiler as President and Chief Executive Officer of the Company, effective May 3, 2026. Mr. Seiler will succeed Corey A. Chambas, whose retirement from his role as the Company’s Chief Executive Officer was announced in May 2025.
Earnings Release Supplement and Conference Call
On April 23, 2026, the Company posted an earnings release supplement to its website firstbusiness.bank under the “Investor Relations” tab which will also be furnished to the U.S. Securities and Exchange Commission on April 23, 2026. The information included in the supplement provides an overview of the Company’s recent operating performance, financial condition, and other data relevant to the quarter. The Company intends to use this supplement in connection with its first quarter 2026 earnings call to be held at 1:00 p.m. Central time on April 24, 2026. The conference call can be accessed at 800-715-9871 (646-307-1963) if outside the United States and Canada), using the conference call access code: FBIZ, 2129267. Investors may also listen live via webcast at: https://events.q4inc.com/attendee/805218265. A replay of the call will be available through Friday, May 1, 2026, by calling 800-770-2030 (609-800-9909 if outside the United States and Canada). The webcast archive of the conference call will be available on the Company’s website, ir.firstbusiness.bank.
About First Business Bank
First Business Bank ® specializes in Business Banking, including Commercial Banking and Specialty Finance, Private Wealth, and Bank Consulting services, and through its refined focus delivers unmatched expertise, accessibility, and responsiveness. Specialty Finance solutions are delivered through First Business Bank’s wholly owned subsidiary First Business Specialty Finance, LLC ®. First Business Bank is a wholly owned subsidiary of First Business Financial Services, Inc ®. (Nasdaq: FBIZ). For additional information, visit firstbusiness.bank.
This release may include forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995, which reflect First Business Bank’s current views with respect to future events and financial performance. Forward-looking statements are not based on historical information, but rather are related to future operations, strategies, financial results, or other developments. Forward-looking statements are based on management’s expectations as well as certain assumptions and estimates made by, and information available to, management at the time the statements are made. Those statements are based on general assumptions and are subject to various risks, uncertainties, and other factors that may cause actual results to differ materially from the views, beliefs, and projections expressed in such statements. Such statements are subject to risks and uncertainties, including among other things:
For further information about the factors that could affect the Company’s future results, please see the Company’s annual report on Form 10-K for the year ended December 31, 2025, and other filings with the Securities and Exchange Commission.
SELECTED FINANCIAL CONDITION DATA
(Unaudited)
As of
(in thousands)
March 31,
2026
December 31,
2025
September 30,
2025
June 30,
2025
March 31,
2025
Assets
Cash and cash equivalents
$137,125
$39,485
$44,349
$123,208
$170,617
Securities available-for-sale, at fair value
420,325
422,087
411,111
382,365
359,394
Securities held-to-maturity, at amortized cost
4,797
5,210
5,584
5,714
6,590
Loans held for sale
23,700
18,849
13,482
12,415
10,523
Loans and leases receivable
3,498,903
3,373,241
3,334,956
3,250,925
3,184,400
Allowance for credit losses
(36,631)
(35,877)
(36,690)
(36,861)
(35,236)
Loans and leases receivable, net
3,462,272
3,337,364
3,298,266
3,214,064
3,149,164
Premises and equipment, net
4,500
4,669
4,936
5,063
5,017
Repossessed assets
—
—
—
31
36
Right-of-use assets
5,053
5,317
5,577
5,713
5,439
Bank-owned life insurance
84,776
83,994
83,255
82,761
57,647
Federal Home Loan Bank stock, at cost
11,242
8,940
9,605
10,027
10,434
Goodwill and other intangible assets
12,011
11,985
12,041
12,049
12,058
Derivatives
38,198
36,515
37,634
40,814
48,405
Accrued interest receivable and other assets
116,856
107,472
109,005
108,501
109,555
Total assets
$4,320,855
$4,081,887
$4,034,845
$4,002,725
$3,944,879
Liabilities and Stockholders’ Equity
Core deposits
$2,796,059
$2,673,003
$2,592,110
$2,533,099
$2,462,695
Wholesale deposits
769,943
707,412
740,961
772,123
780,348
Total deposits
3,566,002
3,380,415
3,333,071
3,305,222
3,243,043
Federal Home Loan Bank advances and
other borrowings
303,451
252,051
266,677
276,131
286,590
Lease liabilities
7,032
7,361
7,687
7,887
7,604
Derivatives
35,857
36,926
38,726
41,228
45,612
Accrued interest payable and other liabilities
28,433
33,549
30,365
27,462
25,967
Total liabilities
3,940,775
3,710,302
3,676,526
3,657,930
3,608,816
Total stockholders’ equity
380,080
371,585
358,319
344,795
336,063
Total liabilities and stockholders’ equity
$4,320,855
$4,081,887
$4,034,845
$4,002,725
$3,944,879
STATEMENTS OF INCOME
(Unaudited)
As of and for the Three Months Ended
(Dollars in thousands, except per share amounts)
March 31,
2026
December 31,
2025
September 30,
2025
June 30,
2025
March 31,
2025
Total interest income
$61,896
$62,752
$63,746
$61,282
$59,530
Total interest expense
26,378
27,990
28,860
27,498
26,272
Net interest income
35,518
34,762
34,886
33,784
33,258
Provision for credit losses
2,960
1,855
1,440
2,701
2,659
Net interest income after provision for credit losses
32,558
32,907
33,446
31,083
30,599
Private wealth management service fees
3,877
3,788
3,687
3,748
3,492
Gain on sale of SBA loans
592
140
382
397
963
Service charges on deposits
1,318
1,188
1,151
1,103
1,048
Loan fees
436
410
501
424
388
Bank owned life insurance income
757
739
965
615
437
Swap fees
628
738
974
170
113
Other non-interest income
1,167
458
1,980
798
1,138
Total non-interest income
8,775
7,461
9,640
7,255
7,579
Compensation
18,541
17,151
17,442
16,534
16,747
Occupancy
588
581
567
564
590
Professional fees
1,446
1,001
1,071
1,487
1,459
Data processing
1,270
1,158
1,123
1,368
1,082
Marketing
711
938
876
1,062
968
Equipment
407
374
296
335
376
Computer software
1,921
1,902
1,826
1,656
1,603
FDIC insurance
909
800
817
834
780
Other non-interest expense
1,160
225
1,682
1,128
1,114
Total non-interest expense
26,953
24,130
25,700
24,968
24,719
Income before income tax expense
14,380
16,238
17,386
13,370
13,459
Income tax expense
2,180
2,905
2,993
1,948
2,288
Net income
$12,200
$13,333
$14,393
$11,422
$11,171
Preferred stock dividends
219
219
218
219
219
Net income available to common shareholders
$11,981
$13,114
$14,175
$11,203
$10,952
Per common share:
Basic earnings
$1.44
$1.58
$1.70
$1.35
$1.32
Diluted earnings
1.44
1.58
1.70
1.35
1.32
Dividends declared
0.34
0.29
0.29
0.29
0.29
Book value
44.12
43.19
41.60
39.98
39.04
Tangible book value
42.68
41.75
40.16
38.54
37.58
Weighted-average common shares
outstanding (1)
8,186,174
8,173,059
8,171,404
8,141,159
8,130,743
Weighted-average diluted common
shares outstanding (1)
8,186,174
8,173,059
8,171,404
8,141,159
8,130,743
(1) Excluding participating securities.
NET INTEREST INCOME ANALYSIS
(Unaudited)
For the Three Months Ended
(Dollars in thousands)
March 31, 2026
December 31, 2025
March 31, 2025
Average
Balance
Interest
Average
Yield/Rate (4)
Average
Balance
Interest
Average
Yield/Rate (4)
Average
Balance
Interest
Average
Yield/Rate (4)
Interest-earning assets
Commercial real estate and other mortgage loans (1)
$2,071,202
$30,216
5.84%
$2,039,138
$31,063
6.09%
$1,925,661
$29,886
6.21%
Commercial and industrial loans (1)
1,306,970
25,409
7.78
1,280,406
25,222
7.88
1,212,656
24,727
8.16
Consumer and other loans (1)
47,579
683
5.74
44,208
631
5.71
47,479
661
5.57
Total loans and leases receivable (1)
3,425,751
56,308
6.57
3,363,752
56,916
6.77
3,185,796
55,274
6.94
Mortgage-related securities (2)
375,989
3,965
4.22
366,158
3,894
4.25
308,656
3,195
4.14
Other investment securities (3)
50,146
280
2.23
49,716
282
2.27
43,145
209
1.94
FHLB stock
9,067
211
9.31
8,614
202
9.38
13,623
294
8.63
Short-term investments
128,649
1,132
3.52
145,425
1,458
4.01
51,072
558
4.37
Total interest-earning assets
3,989,602
61,896
6.21
3,933,665
62,752
6.38
3,602,292
59,530
6.61
Non-interest-earning assets
259,039
247,676
240,076
Total assets
$4,248,641
$4,181,341
$3,842,368
Interest-bearing liabilities
Transaction accounts
$1,220,945
8,354
2.74%
$1,108,916
$8,357
3.01%
$927,250
$7,412
3.20%
Money market
925,282
6,354
2.75
920,194
7,002
3.04
831,598
6,751
3.25
Certificates of deposit
273,635
2,447
3.58
299,349
2,907
3.88
189,547
1,861
3.93
Wholesale deposits
682,138
6,773
3.97
725,607
7,330
4.04
694,431
6,992
4.03
Total interest-bearing deposits
3,102,000
23,928
3.09
3,054,066
25,596
3.35
2,642,826
23,016
3.48
FHLB advances
200,132
1,567
3.13
189,900
1,510
3.18
305,549
2,374
3.11
Other borrowings
54,815
883
6.44
54,787
883
6.45
54,708
882
6.45
Total interest-bearing liabilities
3,356,947
26,378
3.14
3,298,753
27,989
3.39
3,003,083
26,272
3.50
Non-interest-bearing demand deposit accounts
428,739
437,271
414,499
Other non-interest-bearing liabilities
85,304
79,505
90,683
Total liabilities
3,870,990
3,815,529
3,508,265
Stockholders’ equity
377,651
365,812
334,103
Total liabilities and stockholders’ equity
$4,248,641
$4,181,341
$3,842,368
Net interest income
$35,518
$34,763
$33,258
Interest rate spread
3.06%
2.99%
3.11%
Net interest-earning assets
$632,655
$634,912
$599,209
Net interest margin
3.56%
3.53%
3.69%
(1) The average balances of loans and leases include non-accrual loans and leases and loans held for sale. Interest income related to non-accrual loans and leases is recognized when collected. Interest income includes net loan fees collected in lieu of interest.
(2) Includes amortized cost basis of assets available for sale and held to maturity.
(3) Yields on tax-exempt municipal obligations are not presented on a tax-equivalent basis in this table.
(4) Represents annualized yields/rates.
BETA ANALYSIS
For the Three Months Ended
(Unaudited)
March 31, 2026
December 31, 2025
March 31, 2025
Average Yield/Rate (3)
Average Yield/Rate (3)
Increase (Decrease)
Average Yield/Rate (3)
Increase (Decrease)
Total loans and leases (1) receivable (a)
6.57%
6.87%
(0.31)%
6.94%
(0.37)%
Total interest-earning assets (b)(1)
6.20%
6.47%
(0.27)%
6.61%
(0.41)%
Total core deposits (e)
2.41%
2.64%
(0.23)%
2.71%
(0.30)%
Total bank funding (f)
2.73%
2.95%
(0.22)%
3.02%
(0.29)%
Net interest margin (g)(1)
3.56%
3.63%
(0.07)%
3.69%
(0.14)%
Effective fed funds rate (2)(i)
3.64%
3.90%
(0.26)%
4.33%
(0.69)%
Beta Calculations:
Total loans and leases receivable (a)/(i)
117.9%
53.8%
Total interest-earning assets (b)/(i)
104.6%
59.3%
Total core deposits (e/i)
89.1%
43.5%
Total bank funding (f)/(i)
82.8%
42.0%
Net interest margin (g/i)
27.1%
19.8%
PROVISION FOR CREDIT LOSS COMPOSITION
(Unaudited)
For the Three Months Ended
(Dollars in thousands)
March 31,
2026
December 31,
2025
September 30,
2025
June 30,
2025
March 31,
2025
Change due to qualitative factors
$(706)
$(538)
$(243)
$590
$(355)
Change due to quantitative factors
10
(607)
(173)
746
1,560
Charge-offs
2,331
2,809
1,708
1,338
3,810
Recoveries
(168)
(264)
(440)
(332)
(398)
Change in reserves on individually evaluated loans, net
382
(76)
(550)
(247)
(2,495)
Change due to loan growth, net
1,068
408
795
536
741
Change in unfunded commitment reserves
43
123
343
70
(204)
Total provision for credit losses
$2,960
$1,855
$1,440
$2,701
$2,659
ALLOWANCE FOR CREDIT LOSS COMPOSITION
As of
March 31,
2026
December 31,
2025
September 30,
2025
June 30,
2025
(In Thousands)
% of Total
Loans and
Leases
(In Thousands)
% of Total
Loans and
Leases
(In Thousands)
% of Total
Loans and
Leases
(In Thousands)
% of Total
Loans and
Leases
Allowance for credit losses:
Loans collectively evaluated
$30,700
0.88%
$30,327
0.90%
$31,065
0.93%
$30,685
0.94%
Loans individually evaluated
5,931
0.17%
5,550
0.16%
5,625
0.17%
6,176
0.19%
Unfunded commitments reserve
1,858
1,815
1,692
1,349
Total
38,489
1.10%
37,692
1.12%
38,382
1.15%
38,210
1.18%
Loans and lease receivables:
$3,498,903
$3,373,241
$3,334,956
$3,250,925
PERFORMANCE RATIOS
For the Three Months Ended
(Unaudited)
March 31,
2026
December 31,
2025
September 30,
2025
June 30,
2025
March 31,
2025
Return on average assets (annualized)
1.13%
1.25%
1.40%
1.14%
1.14%
Return on average tangible common equity (annualized)
13.55%
14.83%
17.29%
14.17%
14.13%
Efficiency ratio
61.14%
56.61%
57.44%
60.97%
60.28%
Interest rate spread
3.06%
2.99%
3.11%
3.10%
3.11%
Net interest margin
3.56%
3.53%
3.68%
3.67%
3.69%
Average interest-earning assets to average interest-bearing liabilities
118.85%
119.25%
118.66%
118.94%
119.95%
ASSET QUALITY RATIOS
(Unaudited)
As of
(Dollars in thousands)
March 31,
2026
December 31,
2025
September 30,
2025
June 30,
2025
March 31,
2025
Non-accrual loans and leases
$40,503
$43,855
$23,513
$28,633
$24,056
Repossessed assets
0
0
0
31
36
Total non-performing assets
$40,503
$43,855
$23,513
$28,664
$24,092
Non-accrual loans and leases as a percent of total gross loans and leases
1.16%
1.30%
0.70%
0.88%
0.76%
Non-performing assets as a percent of total gross loans and leases plus repossessed assets
1.16%
1.30%
0.70%
0.88%
0.76%
Non-performing assets as a percent of total assets
0.94%
1.07%
0.58%
0.72%
0.61%
Allowance for credit losses as a percent of total gross loans and leases
1.10%
1.12%
1.15%
1.18%
1.15%
Allowance for credit losses as a percent of non-accrual loans and leases
95.03%
85.95%
163.24%
133.45%
151.79%
NET CHARGE-OFFS (RECOVERIES)
(Unaudited)
For the Three Months Ended
(Dollars in thousands)
March 31,
2026
December 31,
2025
September 30,
2025
June 30,
2025
March 31,
2025
Charge-offs
$2,331
$2,809
$1,708
$1,338
$3,810
Recoveries
(168)
(264)
(440)
(332)
(398)
Net charge-offs (recoveries)
$2,163
$2,545
$1,268
$1,006
$3,412
Net charge-offs (recoveries) as a percent of average gross loans and leases (annualized)
0.25%
0.30%
0.15%
0.12%
0.43%
CAPITAL RATIOS
As of and for the Three Months Ended
(Unaudited)
March 31,
2026
December 31,
2025
September 30,
2025
June 30,
2025
March 31,
2025
Total capital to risk-weighted assets
12.15%
12.24%
12.18%
12.25%
12.20%
Tier I capital to risk-weighted assets
9.74%
9.79%
9.67%
9.66%
9.60%
Common equity tier I capital to risk- weighted assets
9.43%
9.48%
9.34%
9.33%
9.26%
Tier I capital to adjusted assets
8.93%
8.86%
8.87%
8.82%
8.77%
Tangible common equity to tangible assets
8.26%
8.54%
8.31%
8.04%
7.93%
LOAN AND LEASE RECEIVABLE COMPOSITION
(Unaudited)
As of
(in thousands)
March 31,
2026
December 31,
2025
September 30,
2025
June 30,
2025
March 31,
2025
Commercial real estate:
Commercial real estate - owner occupied
$306,593
$293,706
$287,005
$262,988
$258,050
Commercial real estate - non-owner occupied
925,425
885,870
871,807
846,990
838,634
Construction and land development
224,866
248,560
236,590
218,840
215,613
Multi-family
577,271
571,468
565,102
573,208
549,220
1-4 family
61,332
60,661
66,735
45,171
48,450
Total commercial real estate
2,095,487
2,060,265
2,027,239
1,947,197
1,909,967
Commercial and industrial
1,358,413
1,273,997
1,264,111
1,259,171
1,229,098
Consumer and other
47,223
40,965
45,323
45,744
46,190
Total gross loans and leases receivable
3,501,123
3,375,227
3,336,673
3,252,112
3,185,255
Less:
Allowance for credit losses
36,631
35,877
36,690
36,861
35,236
Deferred loan fees
2,220
1,986
1,717
1,187
855
Loans and leases receivable, net
$3,462,272
$3,337,364
$3,298,266
$3,214,064
$3,149,164
DEPOSIT COMPOSITION
(Unaudited)
As of
(in thousands)
March 31,
2026
December 31,
2025
September 30,
2025
June 30,
2025
March 31,
2025
Non-interest-bearing transaction accounts
$405,281
$378,770
$400,697
$396,448
$433,201
Interest-bearing transaction accounts
1,170,271
1,103,696
1,050,233
1,047,434
1,015,846
Money market accounts
960,052
905,773
840,477
833,684
831,897
Certificates of deposit
260,455
284,764
300,703
255,533
181,751
Wholesale deposits
769,943
707,412
740,961
772,123
780,348
Total deposits
$3,566,002
$3,380,415
$3,333,071
$3,305,222
$3,243,043
Uninsured deposits
$1,237,344
$1,220,177
$1,100,868
$1,069,509
$1,055,347
Less: uninsured deposits collateralized by pledged assets
59,613
68,656
72,561
67,990
9,344
Total uninsured, net of collateralized deposits
$1,177,731
$1,151,521
$1,028,307
$1,001,519
$1,046,003
% of total deposits
33.0%
34.1%
30.9%
30.3%
32.3%
SOURCES OF LIQUIDITY
(Unaudited)
As of
(in thousands)
March 31,
2026
December 31,
2025
September 30,
2025
June 30,
2025
March 31,
2025
Short-term investments
$104,565
$8,714
$8,074
$72,520
$136,033
Collateral value of unencumbered pledged loans
968,320
992,398
906,042
893,499
973,494
Market value of unencumbered securities
387,700
388,474
376,783
347,196
324,365
Readily accessible liquidity
1,460,585
1,389,586
1,290,899
1,313,215
1,433,892
Fed fund lines
45,000
45,000
45,000
45,000
45,000
Excess brokered CD capacity(1)
806,268
775,851
732,951
645,843
477,468
Total liquidity
$2,311,853
$2,210,437
$2,068,850
$2,004,058
$1,956,360
Total uninsured, net of collateralized deposits
$1,177,731
$1,151,521
$1,028,307
$1,001,519
$1,046,003
PRIVATE WEALTH OFF-BALANCE SHEET COMPOSITION
(Unaudited)
As of
(in thousands)
March 31,
2026
December 31,
2025
September 30,
2025
June 30,
2025
March 31,
2025
Trust assets under management
$3,613,536
$3,541,768
$3,543,594
$3,461,659
$3,184,197
Trust assets under administration
267,214
272,910
270,222
268,996
240,366
Total trust assets
$3,880,750
$3,814,678
$3,813,816
$3,730,655
$3,424,563
NON-GAAP RECONCILIATIONS
Certain financial information provided in this release is determined by methods other than in accordance with generally accepted accounting principles (United States) (“GAAP”). Although the Company’s management believes that these non-GAAP financial measures provide a greater understanding of its business, these measures are not necessarily comparable to similar measures that may be presented by other companies.
TANGIBLE BOOK VALUE
“Tangible book value per share” is a non-GAAP measure representing tangible common equity divided by total common shares outstanding. “Tangible common equity” itself is a non-GAAP measure representing common stockholders’ equity reduced by intangible assets, if any. The Company’s management believes that this measure is important to many investors in the marketplace who are interested in period-to-period changes in book value per common share exclusive of changes in intangible assets. The information provided below reconciles tangible book value per share and tangible common equity to their most comparable GAAP measures.
(Unaudited)
As of
(Dollars in thousands, except per share amounts)
March 31,
2026
December 31,
2025
September 30,
2025
June 30,
2025
March 31,
2025
Common stockholders’ equity
$368,088
$359,593
$346,327
$332,803
$324,071
Less: Goodwill and other intangible assets
(12,011)
(11,985)
(12,041)
(12,049)
(12,058)
Tangible common equity
$356,077
$347,608
$334,286
$320,754
$312,013
Common shares outstanding
8,343,519
8,325,376
8,324,387
8,323,470
8,301,967
Book value per share
$44.12
$43.19
$41.60
$39.98
$39.04
Tangible book value per share
$42.68
$41.75
$40.16
$38.54
$37.58
TANGIBLE COMMON EQUITY TO TANGIBLE ASSETS
“Tangible common equity to tangible assets” (“TCE”) is defined as the ratio of common stockholders’ equity reduced by intangible assets, if any, divided by total assets reduced by intangible assets, if any. Adjusted TCE ratio is defined as TCE adjusted for net fair value adjustments of financial assets and liabilities. For more information on fair value adjustments please refer to Note 19 - Fair Value Disclosures in the annual report on Form 10-K for the year ended December 31, 2025. The Company’s management believes that this measure is important to many investors in the marketplace who are interested in the relative changes from period to period in common equity and total assets, each exclusive of changes in intangible assets. The information below reconciles tangible common equity and tangible assets to their most comparable GAAP measures.
(Unaudited)
As of
(Dollars in thousands)
March 31,
2026
December 31,
2025
September 30,
2025
June 30,
2025
March 31,
2025
Common stockholders’ equity
$368,088
$359,593
$346,327
$332,803
$324,071
Less: Goodwill and other intangible assets
(12,011)
(11,985)
(12,041)
(12,049)
(12,058)
Tangible common equity (a)
$356,077
$347,608
$334,286
$320,754
$312,013
Total assets
$4,320,855
$4,081,887
$4,034,845
$4,002,725
$3,944,879
Less: Goodwill and other intangible assets
(12,011)
(11,985)
(12,041)
(12,049)
(12,058)
Tangible assets (b)
$4,308,844
$4,069,902
$4,022,804
$3,990,676
$3,932,821
Tangible common equity to tangible assets
8.26%
8.54%
8.31%
8.04%
7.93%
EFFICIENCY RATIO & PRE-TAX, PRE-PROVISION ADJUSTED EARNINGS
“Efficiency ratio” is a non-GAAP measure representing non-interest expense excluding the effects of the SBA recourse provision, impairment of tax credit investments, losses or gains on repossessed assets, amortization of other intangible assets and other discrete items, if any, divided by operating revenue, which is equal to net interest income plus non-interest income less realized gains or losses on securities, if any. “Pre-tax, pre-provision adjusted earnings” is defined as operating revenue less operating expense. In the judgment of the Company’s management, the adjustments made to non-interest expense and non-interest income allow investors and analysts to better assess the Company’s operating expenses in relation to its core operating revenue by removing the volatility that is associated with certain one-time items and other discrete items. The information provided below reconciles the efficiency ratio and pre-tax, pre-provision adjusted earnings to its most comparable GAAP measure.
(Unaudited)
For the Three Months Ended
(Dollars in thousands)
March 31,
2026
December 31,
2025
September 30,
2025
June 30,
2025
March 31,
2025
Total non-interest expense
$26,953
$24,130
$25,700
$24,968
$24,719
Less:
Net (gain) loss on repossessed assets
—
—
31
4
(8)
(Recovery) impairment of tax credit investments
(7)
229
—
—
110
Contribution to First Business Charitable Foundation
—
—
234
—
—
SBA recourse provision (benefit)
(121)
—
(5)
(59)
—
Total operating expense (a)
$27,081
$23,901
$25,440
$25,023
$24,617
Net interest income
$35,518
$34,762
$34,886
$33,784
$33,258
Total non-interest income
8,775
7,461
9,640
7,255
7,579
Less:
Bank owned life insurance claim
—
—
234
—
—
Adjusted non-interest income
8,775
7,461
9,406
7,255
7,579
Total operating revenue (b)
$44,293
$42,223
$44,292
$41,039
$40,837
Efficiency ratio
61.14%
56.61%
57.44%
60.97%
60.28%
Pre-tax, pre-provision adjusted earnings (b - a)
$17,212
$18,322
$18,852
$16,016
$16,220