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Category: Commerce

  • MIL-OSI USA: Klobuchar Opening Remarks at Spotlight Forum on the Consumer Product Safety Commission

    US Senate News:

    Source: United States Senator Amy Klobuchar (D-Minn)
    Klobuchar Opening Remarks at Spotlight Forum on the Consumer Product Safety Commission
    WATCH KLOBUCHAR’S FULL REMARKS HERE
    WASHINGTON – U.S. Senator Amy Klobuchar (D-MN) gave the following remarks at a spotlight forum she hosted titled “Buyers Beware: Attacks on Nation’s Product Safety Watchdog Threaten Americans’ Safety.”  
    Testifying at the forum was Don Mays, Product Safety Expert; Jonathan Midgett, PhD, Former CPSC Consumer Ombudsman; Austin Schlick, Former CPSC General Counsel and Executive Director; R. David Pittle, Former CPSC Commissioner; Alan Korn, Executive Director of Abbey’s Hope Charitable Foundation; Trista Hamsmith, founder of Reese’s Purpose; and Brett Horn, founder of Charlie’s House. 
     Senator Klobuchar: Well, thank you so much, Senator Blumenthal. I’m really impressed by this group, that knows a lot about what they’re talking about, and we need to hear from you today. 
    I think I’ve always figured, and maybe this is from my days as a prosecutor, but the first responsibility of government is to protect the people of America, and not only from foreign and domestic threats, but also from … unsafe products. 
    For over 50 years, the CPSC Commissioners have done just that, working on a bipartisan basis to ensure Americans feel confident about the safety and the reliability of their products. Last year alone, the CPSC negotiated the recall of 153 million unsafe items and conducted more than 4,100 in-depth investigations. 
    I have grown to value the CPSC through various administrations. My first experience was the toy issue. A little boy in Minnesota, Mom, bought some Reebok tennis shoes, and there was a charm in there as a little gift, and he swallowed it, and he didn’t die, actually, by choking, he died over a period of days because there was lead in the toy, and it went into his system. And from there, I got to as a brand new Senator, work on the Consumer Product Safety bill that was passed with a really strong vote, and we saved a whole lot of lives, and that was during the Bush administration. 
    Then you move forward, and the work that we’ve all done together on everything from Ikea dressers to airbags to, really, finally, for me, a little girl named Abbey Taylor who died by just going into a kiddie swimming pool. And I worked then, along with several others, to pass the Virginia Graeme Baker Act, which made very clear that you have to have safe pool drains. That bill was then implemented by someone; you can’t just pass a bill and say, “Hey, we did it,” and that was the CPSC, which engaged in education efforts around the country. And maybe one of my favorite moments as a Senator was a few years back when we had the Commissioners before us in the Commerce Committee, and I asked if there had been any deaths since then, 10 years had passed, and they said “not one,” and we were literally having a handful of kids die every year or get maimed because of these pool drains, and I think that’s just such a great example of the work that goes on.
    So I’ve always seen this as bipartisan; the work we’ve done, it was one of the most interesting things and positive things we did on the Commerce Committee. And I’m very concerned to partisan up this CPSC, whose mission is just about a far away from partisanship as you can get, makes no sense, and so I’m so glad that we are, Senator Blumenthal, thank you, and that we are going to hear from all of you today about why we need a strong CPSC and that we shouldn’t be making it partisan. Thank you.
    Klobuchar has long been a leader in consumer protection.  
    In 2023, Klobuchar’s legislation to protect children from furniture tip-over injuries was signed into law. The STURDY Act strengthens furniture safety standards to prevent children from being injured by fatal furniture tip-overs. Each year, nearly 10,000 children go to the emergency room (ER) as a result of furniture tip-over injuries.
    Klobuchar also spearheaded regulating lead in consumer products as a part of the 2008 Consumer Product Safety Improvement Act (CPSIA), which set stringent standards for levels of lead in children’s toys. 
    In 2007, Klobuchar’s legislation, the Virginia Graeme Baker Pool and Spa Safety Act, was signed into law. The law mandated that all public pools install safe drain covers preventing suction entrapment, established a voluntary grant program for states to promote pool and spa safety, and created a national public education campaign to raise awareness about drowning prevention. 
    Video is available HERE.

    MIL OSI USA News –

  • MIL-OSI USA: Klobuchar, Colleagues Press FTC to Implement “Click-to-Cancel”

    US Senate News:

    Source: United States Senator Amy Klobuchar (D-Minn)

    WASHINGTON — U.S. Senator Amy Klobuchar (D-MN) led her colleagues in a letter to Chair of the Federal Trade Commission (FTC), Andrew N. Ferguson, urging him to reissue and finalize its Negative Option Rule (known as “click-to-cancel”) that would make it easier for consumers to unsubscribe from subscriptions.

    “We write regarding the Federal Trade Commission’s (FTC) rulemaking to revise its Negative Option Rule to make it as easy for consumers to cancel a subscription as it was to sign up, frequently referred to as ‘click-to-cancel,’” wrote the Senators. “A review of more than 16,000 comments from the public made clear what should be obvious: Businesses should not be allowed to trap consumers in costly subscriptions by making it difficult to unsubscribe—costing consumers valuable time and money while stifling competition.” 

    “The FTC’s vital click-to-cancel rule was set to go into effect on July 14, 2025,” the Senators continued. “Yet, as you are aware, the Eighth Circuit Court of Appeals vacated the rule on procedural grounds. We urge the FTC to cure any perceived procedural defect and reissue the rule as quickly as possible to ensure consumers are protected from predatory subscription traps.”

    The letter was also signed by Senators Chris Van Hollen (D-MD), Ruben Gallego (D-AZ), Richard Blumenthal (D-CT), Cory Booker (D-NJ), , Kirsten Gillibrand (D-NY), and Jeff Merkey (D-OR).

    The full text of the letter is available here and below:

    Dear Chair Ferguson:

    We write regarding the Federal Trade Commission’s (FTC) rulemaking to revise its Negative Option Rule to make it as easy for consumers to cancel a subscription as it was to sign up, frequently referred to as “click-to-cancel.” A review of more than 16,000 comments from the public made clear what should be obvious: Businesses should not be allowed to trap consumers in costly subscriptions by making it difficult to unsubscribe—costing consumers valuable time and money while stifling competition. The FTC’s vital click-to-cancel rule was set to go into effect on July 14, 2025. Yet, as you are aware, the Eighth Circuit Court of Appeals vacated the rule on procedural grounds. We urge the FTC to cure any perceived procedural defect and reissue the rule as quickly as possible to ensure consumers are protected from predatory subscription traps.  

    Putting this commonsense consumer protection in place is vital to foster competition, innovation, and fairness. In today’s digital economy, more and more of what consumers purchase are offered as fee-for-service subscription programs, whether it be for video and music streaming services, ecommerce membership programs, gaming subscriptions, meal kit delivery services, cloud storage, home security monitoring, magazine or news subscriptions, fitness memberships, and many others. While these services are valued by many consumers, the costs for subscription services often add up to far more than consumers think, and it is often difficult for consumers to navigate the complicated process of cancelling those subscriptions. Other firms that allow consumers to subscribe to a service with the click of a button require consumers to talk to a customer service agent or jump through other hoops just to unsubscribe, even though many such businesses tell consumers they can cancel at any time. These practices have no countervailing benefit or redeeming justification. They just make life difficult and expensive. 

    These unfair practices also deter competition and stifle innovation. Subscription traps make it more difficult for consumers to switch providers, even if the alternative offers better, cheaper, or more innovative services. Allowing these practices incentivizes firms to spend time and resources locking consumers into their subscriptions rather than working to retain them with lower prices and better products. It also creates barriers to entry for innovative startups to break into markets because it is difficult for them to win consumers locked into competing subscriptions they cannot easily escape.   

    We urge the FTC to take all the steps necessary to reissue and finalize the Negative Option Rule so that consumers can cancel subscriptions quickly and easily. 

     

    MIL OSI USA News –

  • MIL-OSI: Altucher Releases Urgent Presentation Potentially Linking August 13 to Starlink’s Global Pivot

    Source: GlobeNewswire (MIL-OSI)

    Austin, TX, July 22, 2025 (GLOBE NEWSWIRE) — A newly released presentation by bestselling author and tech entrepreneur James Altucher is drawing attention for spotlighting a potential turning point in the rollout of Elon Musk’s satellite network, Starlink.

    Altucher outlines a series of developments—some public, some behind closed doors—that appear to be converging around a single date: August 13, 2025.

    At the center of the story is what Altucher describes as “a multi-decade plan” to create a satellite-based communications grid that could replace traditional systems and establish a new digital foundation for the modern world.

    The Architecture of a Quiet Revolution

    The presentation suggests this quiet build-up may soon enter a public phase, marking a moment Altucher believes many will miss—because they weren’t paying attention.

    A Meeting That Sparked Everything

    Altucher first began connecting the dots after learning about a private meeting involving Elon Musk and industry insiders.

    Though the contents of that meeting remain undisclosed, the timing aligns with a series of recent media statements from Musk and his team—signals Altucher says have been overlooked by the public and press alike.

    Altucher’s Warning

    As the presentation nears its conclusion, Altucher issues a clear message: the window may be closing.

    “After this date, the window could slam shut—and you may never have this same chance again,” he writes, referring to August 13.

    He adds, “This is about recognizing the moments when everything changes. Not years later—right now”

    About James Altucher

    James Altucher is a serial entrepreneur, bestselling author, and podcast host. He’s launched more than 20 companies across software, media, and finance. Altucher has authored 25+ books including Choose Yourself, Reinvent Yourself, and Skip the Line. His writing has appeared in The Wall Street Journal, Forbes, and TechCrunch, and he has been featured on CNBC, Fox Business, and major global platforms. His daily insights reach millions seeking clarity at the intersection of technology, power, and personal freedom.

    The MIL Network –

  • MIL-OSI USA: Kennedy applauds USDOT lease agreement for National Center of Excellence for LNG Safety in Lake Charles

    US Senate News:

    Source: United States Senator John Kennedy (Louisiana)

    WASHINGTON – Senator John Kennedy (R-La.), a member of the Senate Appropriations Committee, issued the following statement applauding the U.S. Department of Transportation’s Pipeline and Hazardous Materials Safety Administration (PHMSA) for entering into a 20-year lease agreement with McNeese State University in Lake Charles, La., the location of the PHMSA National Center of Excellence for Liquefied Natural Gas (LNG) Safety (the Center). McNeese was chosen as the Center’s site earlier this year. The lease will start on August 1, 2025.

    “LNG production is one of the most critical ways our nation can unleash our energy dominance and protect our national security, and Louisiana is leading the way. I’m proud to see the U.S. Department of Transportation take this major step forward in building our National Center of Excellence for LNG Safety in Lake Charles. This Center will be a game changer for our region and be the tip of the spear for LNG innovation, operations, and safety in the U.S.,” said Kennedy. 

    “Louisiana is at the heart of America’s growing LNG revolution. There is no better place to locate our Center of Excellence to ensure we safely transport this critical energy source,” said U.S. Transportation Secretary Sean P. Duffy.

    The Protecting our Infrastructure of Pipelines and Enhancing Safety (PIPES) Act of 2020 required PHMSA to establish that the National Center of Excellence for LNG Safety improve the federal government’s LNG facility expertise, serve as an information repository on best practices for LNG facilities, and facilitate collaboration among LNG stakeholders. 

    “We are excited to reach another important milestone in the construction of the Center, which will be a hub for advancing U.S. LNG safety,” said PHMSA Acting Administrator Ben Kochman. 

    “We are thrilled to finalize the long-term lease with PHMSA for a location on our McNeese campus. This project has been in the works for over two years, and it would not have been possible without the tireless efforts of Senator Kennedy and his staff, our partners in Washington, D.C., and our colleagues at the University of Louisiana. We believe having PHMSA right here in Lake Charles—working alongside us—will serve as a powerful catalyst for securing the future of our region’s vital industries,” said Dr. Wade Rousse, President, McNeese State University.

    Kennedy has long fought for the National Center of Excellence for LNG Safety and its presence in southwest Louisiana.

    • In 2020, Kennedy inserted a provision into the PIPES Act requiring the Center to be located in Louisiana. The PIPES Act, including Kennedy’s addition, became law as part of the Consolidated Appropriations Act of 2021.
    • In May 2024, Kennedy questioned then-Secretary of Transportation Pete Buttigieg during the Senate Appropriations Subcommittee on Transportation, Housing and Urban Development and Related Agencies (THUD Appropriations). In response to Kennedy’s questions, Buttigieg confirmed that the Center would be located in Lake Charles, La.
    • During a May 2025 THUD Appropriations hearing, Kennedy questioned Secretary Duffy and confirmed that McNeese State University would be the site of the new Center. McNeese State University is the first undergraduate institution in the U.S. to offer a certificate program in the LNG Business and already hosts its own LNG Center of Excellence.

    PHMSA and other federal agencies, including the U.S. Coast Guard, Department of Energy, and Federal Energy Regulatory Commission, have worked together to ensure the Center is focused on its mission of making the U.S. the leader in LNG operations. 

    Additional information about the National Center of Excellence for LNG Safety is available on PHMSA’s website.

    MIL OSI USA News –

  • MIL-OSI USA: Tiffany’s Legislation to Help Wabeno Small Business Clears House

    Source: United States House of Representatives – Representative Tom Tiffany (WI-07)

    WASHINGTON, DC –Today, Congressman Tom Tiffany’s (WI-07) Wabeno Economic Development Act passed the U.S. House of Representatives with overwhelming bipartisan support. H.R. 3937 will expedite the conveyance of 14 acres of land in the Chequamegon-Nicolet National Forest to Tony’s Wabeno Redi-Mix for fair market value.

    After years of not making progress with the U.S. Forest Service, Tony—the owner of Tony’s Wabeno Redi-Mix—turned to Congressman Tiffany’s office for help. His business is running out of nearby aggregate materials like stone, sand, and gravel, and they will exhaust supply in approximately 2 years. The adjacent parcel is critical for the business’s future and ability to stay in operation.

    “This conveyance will deliver long-term economic growth and protect local jobs for the people of Wabeno and Forest County,” said Congressman Tiffany. “It will ensure Tony’s Wabeno Redi-Mix stays open and continues serving the community for years to come.”

    Background:

    Tony’s Wabeno Redi-Mix has been serving the community for 25 years and currently employs 17 people. The company provides concrete for both contractors and homeowners across a 50-mile radius. Projects include large-scale work for the Forest County Potawatomi Community, local fire and rescue stations, town shops and offices, agricultural projects for local farmers, and residential construction and remodeling.

    Tony first began working with the Forest Service on this land exchange more than eight years ago. However, the agency made it clear the project was not a priority and lacked the resources to complete it. With much of Forest County under federal ownership as part of the Chequamegon-Nicolet National Forest, there is limited private land available for small business expansion.  

    This legislation is supported by the Wabeno Area Chamber of Commerce, the Forest County Economic Development Partnership, and the Town of Wabeno. Tom Tallier, Forest County Board Supervisor for District 8, offered key testimony in favor of the bill last year.

    You can view Rep. Tiffany’s comments on the House floor here, and Rep. Debbie Dingell’s (MI-06) floor statement of support here. You can read the full text of the bill here.

    ###

    MIL OSI USA News –

  • MIL-OSI USA: Tiffany’s Legislation to Help Wabeno Small Business Clears House

    Source: United States House of Representatives – Representative Tom Tiffany (WI-07)

    WASHINGTON, DC –Today, Congressman Tom Tiffany’s (WI-07) Wabeno Economic Development Act passed the U.S. House of Representatives with overwhelming bipartisan support. H.R. 3937 will expedite the conveyance of 14 acres of land in the Chequamegon-Nicolet National Forest to Tony’s Wabeno Redi-Mix for fair market value.

    After years of not making progress with the U.S. Forest Service, Tony—the owner of Tony’s Wabeno Redi-Mix—turned to Congressman Tiffany’s office for help. His business is running out of nearby aggregate materials like stone, sand, and gravel, and they will exhaust supply in approximately 2 years. The adjacent parcel is critical for the business’s future and ability to stay in operation.

    “This conveyance will deliver long-term economic growth and protect local jobs for the people of Wabeno and Forest County,” said Congressman Tiffany. “It will ensure Tony’s Wabeno Redi-Mix stays open and continues serving the community for years to come.”

    Background:

    Tony’s Wabeno Redi-Mix has been serving the community for 25 years and currently employs 17 people. The company provides concrete for both contractors and homeowners across a 50-mile radius. Projects include large-scale work for the Forest County Potawatomi Community, local fire and rescue stations, town shops and offices, agricultural projects for local farmers, and residential construction and remodeling.

    Tony first began working with the Forest Service on this land exchange more than eight years ago. However, the agency made it clear the project was not a priority and lacked the resources to complete it. With much of Forest County under federal ownership as part of the Chequamegon-Nicolet National Forest, there is limited private land available for small business expansion.  

    This legislation is supported by the Wabeno Area Chamber of Commerce, the Forest County Economic Development Partnership, and the Town of Wabeno. Tom Tallier, Forest County Board Supervisor for District 8, offered key testimony in favor of the bill last year.

    You can view Rep. Tiffany’s comments on the House floor here, and Rep. Debbie Dingell’s (MI-06) floor statement of support here. You can read the full text of the bill here.

    ###

    MIL OSI USA News –

  • MIL-OSI USA: Congressman Russell Fry (SC-07) Introduces Legislation to Codify President Trump’s Executive Order on Showerheads

    Source:

    Congressman Russell Fry (SC-07) Introduces Legislation to Codify President Trump’s Executive Order on Showerheads

    WASHINGTON, D.C. – Today, Congressman Russell Fry (SC-07) introduced the Saving Homeowners from Overregulation With Exceptional Rinsing (SHOWER) Act, a bill to codify President Trump’s clear and consistent definition of “showerhead” and put an end to the federal government’s overregulation of household water fixtures.

    Under the 2016 Trump Administration, the Department of Energy (DOE) rightly clarified that each nozzle in a multi-head shower system could be treated as a separate showerhead, each allowed to flow at up to 2.5 gallons per minute (GPM), consistent with the original intent of the 1992 Energy Policy Act.

    But in 2021, the Biden Administration reversed course, reinstating a burdensome interpretation that limited the combined flow of all nozzles in a system to 2.5 GPM—effectively reducing water pressure and restricting consumer choice. That rule was widely criticized as overreach and emblematic of a broader regulatory agenda targeting everyday household appliances.

    President Trump issued an Executive Order in April of 2025 directing DOE to eliminate the Biden-era rule, and DOE followed through in May by repealing the restrictive definition entirely. The SHOWER Act now ensures this rollback is enshrined in law and cannot be reversed by future administrations.

    Specifically, the bill:

    • Codifies the definition of “showerhead” using the ASME A112.18.1–2018 industry standard.

    • Clarifies that each individual nozzle in a multi-nozzle unit may operate independently at up to 2.5 GPM.

    • Excludes safety showerheads used for emergency purposes.

    • Directs the DOE to revise existing regulations within 180 days to reflect the updated statutory definition.

    • Prevents future reinterpretations that would restrict water flow and limit consumer options.

    “Washington bureaucrats have gone too far in dictating what happens in Americans’ own homes,” said Congressman Fry. “The SHOWER Act is a smart fix that reaffirms each shower nozzle is just that—its own showerhead—and should be treated accordingly under the law. This is about defending consumer choice, pushing back on regulatory overreach, and standing up for commonsense policy.”

    “For far too long federal regulations and red tape have limited consumer choice and forced Americans to live with limited water pressure,” said Chairman Guthrie. “Low pressure showers waste time and increase water usage. By codifying how different nozzles are categorized, the SHOWER Act offers a commonsense fix that will allow households to choose what meets their needs, not what Washington mandates.  Thank you to Representative Fry for leading this legislation and for your work to deliver results for consumers across the country.” 

    Full text of the bill can be found HERE.

    Congressman Fry serves on both the House Energy and Commerce Committee and the House Judiciary Committee. To stay up to date with Congressman Fry and his work for the Seventh District, follow his official Facebook, Instagram, and X pages and visit his website at fry.house.gov.

    MIL OSI USA News –

  • MIL-OSI USA: ICYMI: Tuberville Joins Kudlow to Highlight President Trump’s Wins in First Six Months in Office

    US Senate News:

    Source: United States Senator Tommy Tuberville (Alabama)

    WASHINGTON – U.S. Senator Tommy Tuberville (R-AL) joined Larry Kudlow on Fox Business Network to highlight some of President Trump’s many wins since taking office six months ago, including historic tax cuts, increased military recruitment, protecting female athletes, securing the southern border, and making our food healthier.

    Excerpts from the interview can be found below and the full interview can be viewed on YouTube or Rumble.

    KUDLOW: “So Senator Tuberville, I think one of the themes here—this is something we’ve talked about. Victor Davis Hanson has been writing about this. The experts were wrong. Trump got this stuff done. In particular, the southern border—which is virtually flat now, virtually empty—no crossings. We didn’t need new legislation, right? Remember that push? We just needed somebody who was tough enough to enforce the laws. Let’s start with that one, okay? Immigration. How about that? Maybe his greatest achievement.”

    TUBERVILLE: “Well, you’re exactly right and one of the repercussions of the immigration stoppage of keeping very few illegals coming to our country—we’re saving $40 billion dollars to this point in this budget. $40 billion dollars. And that’s going to count up. We could not afford for Kamala Harris to win this election because it would have been a disaster, just for the immigration alone, which would [have] just stair-stepped everything to becoming a disaster when it come to the economy.”

    KUDLOW: “And you know Senator, the Democrats have to be crazy and just out of their minds to oppose this, okay? They’re still defend[ing]—and they’re still in the business of defending sanctuary cities and of defending the worst of the worst criminals. And we just had this awful shooting of a border agent in New York City. And DHS secretary Kristi Noem correctly just blasted New York City Democrats. They got a mayor—the Socialist mayor, Communist mayor, whatever he is—Mamdani the Commie. He wants to keep ICE agents out. He wants to keep Netanyahu out. He wants to keep Trump out. I mean, how can the Democrats be so stupid? I call them experts. They’re really just deep state people who arejust on the wrong side of all these issues.”

    TUBERVILLE: “Well, the wrong side, and that’s the only side they can reach to, Larry, for votes. They have to have votes, and they’re looking for somewhere to get votes. This sanctuary city nonsense—it’s unlawful. People are going to get hurt more and more when you hang out in these sanctuary cities. But all they’re doing is pushing socialism, and all socialism is just—it’s communism without a gun, at the end of the day. And so, we need to understand the direction this country’s going if the Democrats have an opportunity to get a leg back into this country in terms of leadership. That’s not going to happen. As you just said, I was at that dinner in the White House Friday night when President Trump was going through all those wins that we’ve had. It’s just amazing to me that it takes so long to go through them, our dinner got cold. But at the end of the day, it was so fun to listen to all that. It’s just amazing what he’s done in six months.”

    KUDLOW: “So the experts were wrong, tariffs are not inflationary, real wages are actually going up, the stock market is now hitting new record highs. I believe today, both the NASDAQ and the SMP hit new record highs. But here’s one for you, which I think is very important: in six months, military recruitment—new military recruitment—Pete Hegseth, Defense Secretary, Donald Trump, President of the United States and Commander in Chief—new military recruitment has gone sky high, record levels. What do you make of that, Senator?”

    TUBERVILLE: “Well, I’ll tell you why, people—these young men and women—are feeling good about our country again. They’re not being told that they’re woke, and they need to be social justice warriors. They’re doing it for the right thing. They’re doing it to protect our country. But it’s also a great way to get an education. It’s a great job. But it wasn’t sold that way by the Democrats. It was sold by the Democrats as ‘Hey, be part of a basically a clown show,’ and that’s what it was turning into. I’m on Armed Services. I’ve never seen anything like the recruiting that was going on. The books that our generals were telling our troops to read, whether it was on ships or in in some of these camps—it’s just amazing to me the direction where we were going.”

    KUDLOW: “Well, here’s another one then. We obliterated Iran, but the deep state experts said, ‘No. No. No. If we hit Iran, it would cause a massive blow-up and war throughout the Middle East and the rest of the world.’ What I don’t see is any of that stuff. In fact, we’re—I guess, we’re at a ceasefire, de facto, if not de jure. But the point is he obliterated the Iran nuclear program. None of them under the Bidens or the Obamas or anybody else had the backbone, I’ll call it, to do such a thing. You know what I mean? Here—tough wins, okay? Tough always wins.”

    TUBERVILLE: “Yep. President Trump’s a peacemaker. He understands sometimes you have to take the tough decision. Don’t listen to everybody else around you. Go by your instincts. He understood that, hey, there is no possible way we can allow Iran to have a nuclear weapon. And if they’re getting this close as his experts were telling him, we’ve got to do something. And so go in, go out. He set them back probably a year and a half, two years. They can always build back. But who’s to say we won’t go back in there in two years and destroy it again? And it’s cost them a trillion dollars to build this infrastructure up. […]”

    KUDLOW: “Here’s another one: no men in women’s sports. How about that? Commonsense, you wouldn’t have thought. This was like a major battle—a major battle. This was like the Democrats’ last stand, but no men in women’s sports.”

    TUBERVILLE: “Yeah. Of course, I’ve been on this ever since it started. This was my first vote when I got here four years ago. And there’s [been] no Democrats in four years vote on any of my bills about no men and women sports. It’s absolutely insane what they’ve tried to do. And it’s an attack on women. And it doesn’t—I don’t understand this. I must be talking to people from a different planet sometimes when they talk about [how] they need the opportunity to do whatever they want to do. No, they don’t. Men and women have separate identities in terms of physical ability, and they need to be separate in sports and that’s the reason we’ve had it this way for 249 years.”

    KUDLOW: “How about this one? I didn’t put it in my riff, but alright, fancy colleges and universities—no more antisemitism. No more racism. No more affirmative action. And if you don’t play ball, you’re gonna lose your grants, your federal grants. Now that is a tough President doing the right thing. Is he not?”

    TUBERVILLE: “Exactly. Our education is going to hell in a handbasket. And here’s the reason why: it’s become a business, Larry. It’s become a business of making money and doing things to where they can pay their presidents $2 or $3 million dollars each and have their private planes. It’s really gone overboard. But let me give you one: 35-40% of the companies in this country have cut out this poison that we’re putting in our food. And of all the people I talk to, this is one of the major wins that President Trump’s had. We don’t talk about it enough. I’m having dinner with Dr. Oz and some of the people of MAHA tonight, and it’s gonna be a celebration of making a lot of progress in just a short period of time and cleaning up our food.”

    KUDLOW: “Well, I love that. Look, we had Bobby Kennedy on the show. He was absolutely terrific. I gotta stop eating ice cream because they’re always weird dyes. I can’t do that anymore. I’m gonna stick to my—” 

    TUBERVILLE: “Eat vanilla. Eat vanilla, Larry.”

    KUDLOW: “I don’t know. Even vanilla, I can’t be sure anymore. He really shook everybody up. But finally, Senator—and this is a tragedy. Today a Border Patrol agent got shot in New York City. I think people, alright. Kristi Noem—DHS Secretary Noem—is blasting this as part of the New York City problem. This is part of the sanctuary city problem. This is part of the blue city Democratic problem. This is Mamdani the Commie problem. He’s gonna make it worse. I mean, this poor guy got shot for no good reason. Now, this stuff has gotta stop.”

    TUBERVILLE: “It really does have to stop. And again, law enforcement, Customs and Border Patrol, whoever is in authority—protect yourself. President Trump has given them authority to protect themself. It’s unfortunate this young person got shot and shot in the face [is] my understanding. Hope he’s fine. But again, this is not gonna be the end of it, Larry. It’s gonna get worse and worse as we go from here. But they have to protect themselves, give them the right to shoot back if they shoot at them…”

    KUDLOW: “And so, let me ask you. I mean, Democrats defunding the police again. I haven’t heard that this is what Mamdani the Commie wants to do. Defund the police, put social workers in their place. By the way, he’s got a clone who just got the Democratic nomination for mayor out in Minneapolis, unbelievable to me. How can they actually argue that? You got your Mayor Bass. You got your Governor Newsom. You got all these people, okay? They may not come out for defund the police, but they don’t want any law and order when it comes to chasing the worst of the worst of the illegal criminals who should be deported. I mean, honestly, this is the Democratic position. I think I saw poll today. The Democratic Party has an approval rating, Senator, of 19%. How about those apples? 19%.”

    TUBERVILLE: “It’s gonna get worse. Can you imagine [in] Minneapolis, and Chicago, and Detroit, and New York, San Francisco, LA—social workers being the police? What uniform are they gonna wear, first of all? And then are they gonna be armed? It will be a total disaster and it’s a disaster waiting to happen. But [radical Democrats] believe in this. I don’t understand it, but it’ll all get straightened out at the end of the day. They’re not gonna win any of the elections coming up [that] they think they’re gonna win. And President Trump’s gonna keep hammering them every day in terms of making sure we take this social justice nonsense out of everything that we do.”

    KUDLOW: “Yes, sir. Yes, sir. Absolutely. Senator Tommy Tuberville, as always, sir, thank you for your wisdom.”

    Senator Tommy Tuberville represents Alabama in the United States Senate and is a member of the Senate Armed Services, Agriculture, Veterans’ Affairs, HELP and Aging Committees.

    MIL OSI USA News –

  • MIL-OSI Canada: Minister Sidhu discusses trade priorities and opportunities with counterparts and business leaders in British Columbia

    Source: Government of Canada News (2)

    July 22, 2025 – Vancouver, British Columbia – Global Affairs Canada

    The Honourable Maninder Sidhu, Minister of International Trade, was in British Columbia (B.C.) from July 17 to 21, to meet with provincial and industry leaders, as well as Trade Commissioner Service (TCS) clients in the defence, aerospace and agriculture sectors.

    During a keynote address at a Surrey Board of Trade event, Minister Sidhu outlined Canada’s economic priorities, including strengthening and diversifying trade relationships worldwide. He spoke about the significance of the Government of Canada’s Team Canada Trade Missions, a key initiative under the Indo-Pacific Strategy that helps Canadian businesses export to new international markets.

    The minister also met with his newly appointed B.C. counterpart, the Minister of Jobs and Economic Growth, Ravi Kahlon. They explored collaboration opportunities between the federal and provincial governments to create market connections for Canadian companies, including through Canada’s TCS. Following their meeting, Minister Kahlon joined Minister Sidhu at a round-table discussion with Business Council of British Columbia members, where they shared Canada’s and B.C.’s priorities for continued growth in the energy sector.

    While in the Vancouver area, Minister Sidhu toured the Port of Vancouver and saw first-hand how the harbour contributes to Canada’s international supply chain, facilitating the flow of exports to Asia and connections to essential goods from around the world. He also visited OSI Maritime Systems Ltd., a successful TCS partner, where he gained valuable insights into the unique export challenges faced by Canadian defence companies. The Minister then met with Tamara Vrooman, President and CEO of the Vancouver International Airport to discuss key priorities, including cargo capacity and enhancing international connectivity.

    In Kitimat, he visited LNG Canada, the country’s first export-oriented liquefied natural gas facility, where he learned about the company’s exports to Asia. As a world leader in the energy sector, Canada is a partner of choice for clean energy solutions and is ready to become a conventional and clean energy superpower.

    Minister Sidhu concluded his visit to B.C. in Kelowna. He participated in a discussion with business leaders at the Kelowna Chamber of Commerce, where he highlighted the role the TCS can play to help B.C. companies reach new export markets. While in Kelowna, the minister also visited Anodyne Electronics Manufacturing, Hillcrest Farms, and KF Aerospace, local businesses, to gain insights into their experiences, discuss challenges they face, and explore how the TCS can support them.

    MIL OSI Canada News –

  • MIL-OSI: Timberland Bancorp Third Fiscal Quarter Net Income Increases to $7.10 Million

    Source: GlobeNewswire (MIL-OSI)

    • Quarterly EPS Increases 22% to $0.90 from $0.74 One Year Ago
    • Quarterly Net Interest Margin Increases to 3.80%
    • Quarterly Return on Average Assets Increases to 1.47%
    • Quarterly Return on Average Equity Increases to 11.23%
    • Announces New Stock Repurchase Program

    HOQUIAM, Wash., July 22, 2025 (GLOBE NEWSWIRE) — Timberland Bancorp, Inc. (NASDAQ: TSBK) (“Timberland” or “the Company”), the holding company for Timberland Bank (the “Bank”), today reported net income of $7.10 million, or $0.90 per diluted common share for the quarter ended June 30, 2025. This compares to net income of $6.76 million, or $0.85 per diluted common share for the preceding quarter and $5.92 million, or $0.74 per diluted common share, for the comparable quarter one year ago.

    For the first nine months of fiscal 2025, Timberland’s net income increased 16% to $20.72 million, or $2.60 per diluted common share, from $17.93 million, or $2.21 per diluted common share for the first nine months of fiscal 2024.

    “Timberland delivered solid third fiscal quarter results, driven by continued net interest margin expansion and steady balance sheet growth,” stated Dean Brydon, Chief Executive Officer. “Net income and earnings per share increased 20% and 22%, respectively, compared to the third fiscal quarter a year ago. Compared to the prior quarter, net income and earnings per share increased 5% and 6%, respectively, primarily due to higher net interest income and non-interest income. We also posted year-over-year improvements across all key profitability metrics, and our tangible book value per share (non-GAAP) continued its upward trend. Looking ahead we believe our strong capital position, solid earnings, and continued focus on disciplined growth position us well to navigate the current environment and drive long-term shareholder value.”

    “As a result of Timberland’s strong earnings and sound capital position, our Board of Directors announced a quarterly cash dividend to shareholders of $0.26 per share, payable on August 22, 2025, to shareholders of record on August 8, 2025,” stated Jonathan Fischer, President and Chief Operating Officer. “This represents the 51st consecutive quarter Timberland will have paid a cash dividend. In addition, the Company also announced the adoption of a new stock repurchase program. We believe Timberland stock presents a strong investment opportunity, and buying back shares is a strategy to enhance long-term value for shareholders. Under the new repurchase program, the Company may repurchase up to 5% of the outstanding shares, or 393,842 shares. The new stock repurchase program replaces our existing stock repurchase program, which had 31,762 shares available to be repurchased.”

    “Our net interest margin continued to show positive momentum in the third fiscal quarter, expanding to 3.80%,” said Marci Basich, Chief Financial Officer. “This represents a one basis point increase from the prior quarter and a 27 basis point improvement compared to the same period last year, reflecting our disciplined asset-liability management and favorable shift in earning asset yields. Total deposits grew by $19 million, or 1%, during the quarter, driven primarily by higher balances in certificates of deposit. This growth highlights the continued strength of our customer relationships and the effectiveness of our deposit-gathering strategies. We remain focused on maintaining a well-balanced funding mix while sustaining stable margin performance going forward.”

    “The loan portfolio continues to expand at a steady pace, with growth of 2% over the prior quarter and 3% year-over year,” Brydon continued. “Credit quality remains an area we are monitoring closely, as we are seeing a mix of stable-to-positive trends alongside a few metrics that have shown modest deterioration. Net charge-offs continue to be minimal, with net recoveries of $1,000 during the third quarter. Our non-performing assets (“NPA”) ratio increased to 0.21% at June 30, 2025, compared to 0.13% at the end of the prior quarter. However, it remains a slight improvement from the 0.22% reported a year ago. Although non-accrual loans increased this quarter primarily due to a single matured loan, total non-accrual balances remain modestly below year-ago levels.”

    Earnings and Balance Sheet Highlights (at or for the periods ended June 30, 2025, compared to June 30, 2024, or March 31, 2025):
      
        Earnings Highlights:

    • Earnings per diluted common share (“EPS”) increased 6% to $0.90 for the current quarter from $0.85 for the preceding quarter and increased 22% from $0.74 for the comparable quarter one year ago; EPS increased 18% to $2.60 for the first nine months of fiscal 2025 from $2.21 for the first nine months of fiscal 2024;
    • Net income increased 5% to $7.10 million for the current quarter from $6.76 million for the preceding quarter and increased 20% from $5.92 million for the comparable quarter one year ago; Net income increased 16% to $20.72 million for the first nine months of fiscal 2025 from $17.93 million for the first nine months of fiscal 2024;
    • Return on average equity (“ROE”) and return on average assets (“ROA”) for the current quarter were 11.23% and 1.47%, respectively;
    • Net interest margin (“NIM”) for the current quarter expanded to 3.80% from 3.79% for the preceding quarter and 3.53% for the comparable quarter one year ago; and
    • The efficiency ratio for the current quarter improved to 54.48% from 56.25% for the preceding quarter and 58.97% for the comparable quarter one year ago.

       Balance Sheet Highlights:

    • Total assets increased 1% from the prior quarter and increased 3% year-over-year;
    • Net loans receivable increased 2% from the prior quarter and increased 3% year-over-year;
    • Total deposits increased 1% from the prior quarter and increased 3% year-over-year;
    • Total shareholders’ equity increased 2% from the prior quarter and increased 6% year-over-year; 34,236 shares of common stock were repurchased during the current quarter for $1.02 million;
    • Non-performing assets to total assets ratio was 0.21% at June 30, 2025 compared to 0.13% at March 31, 2025 and 0.22% at June 30, 2024;
    • Book and tangible book (non-GAAP) values per common share increased to $32.58 and $30.62 respectively, at June 30, 2025; and
    • Liquidity (both on-balance sheet and off-balance sheet) remained strong at June 30, 2025 with only $20 million in borrowings and additional secured borrowing line capacity of $674 million available through the Federal Home Loan Bank (“FHLB”) and the Federal Reserve.

    Operating Results

    Operating revenue (net interest income before the provision for credit losses plus non-interest income) for the current quarter increased 3% to $20.50 million from $19.90 million for the preceding quarter and increased 9% from $18.77 million for the comparable quarter one year ago. The increase in operating revenue compared to the preceding quarter was primarily due to increases in total interest and dividend income and non-interest income, which were partially offset by an increase in total funding costs. Operating revenue increased 8% to $60.06 million for the first nine months of fiscal 2025 from $55.82 million for the first nine months of fiscal 2024, primarily due to an increase in total interest and dividend income, which was partially offset by an increase in funding costs.

    Net interest income increased $409,000, or 2%, to $17.62 million for the current quarter from $17.21 million for the preceding quarter and increased $1.64 million, or 10%, from $15.98 million for the comparable quarter one year ago. The increase in net interest income compared to the preceding quarter was primarily due to a $20.80 million increase in the average balance of total interest-earning assets and, to a lesser extent, a two-basis point increase in the weighted average yield on total interest-earning assets to 5.50% from 5.48%. These increases were partially offset by a $20.21 million increase in the average balance of interest-bearing liabilities and a two-basis point increase in the weighted average cost of interest-bearing liabilities. Timberland’s NIM for the current quarter expanded to 3.80% from 3.79% for the preceding quarter and 3.53% for the comparable quarter one year ago.   The NIM for the current quarter was increased by approximately four basis points due to the collection of $102,000 in pre-payment penalties, non-accrual interest, and late fees, and the accretion of $68,000 of the fair value discount on acquired loans.   The NIM for the preceding quarter was increased by approximately five basis points due to the collection of $201,000 in pre-payment penalties, non-accrual interest, and late fees, and the accretion of $17,000 of the fair value discount on acquired loans.   The NIM for the comparable quarter one year ago was increased by approximately three basis points due to the collection of $124,000 in pre-payment penalties, non-accrual interest, and late fees, and the accretion of $9,000 of the fair value discount on acquired loans. Net interest income for the first nine months of fiscal 2025 increased $4.19 million, or 9%, to $51.81 million from $47.62 million for the first nine months of fiscal 2024, primarily due to a 32 basis point increase in the weighted average yield of total interest-earning assets to 5.49% from 5.17% and a $49.96 million increase in the average balance of total interest-earning assets. These increases to net interest income were partially offset by a seven basis point increase in the weighted average cost of interest-bearing liabilities to 2.53% from 2.46% and a $58.86 million increase in the average balance of total interest-bearing liabilities. Timberland’s NIM expanded to 3.74% for the first nine months of fiscal 2025 from 3.53% for the first nine months of fiscal 2024.

    A $351,000 provision for credit losses on loans was recorded for the quarter ended June 30, 2025. The provision was primarily due to loan portfolio growth and changes in the composition of the loan portfolio. This compares to a $237,000 provision for credit losses on loans for the preceding quarter and a $264,000 provision for credit losses on loans for the comparable quarter one year ago. In addition, a $93,000 provision for credit losses on unfunded commitments and a $4,000 recapture of credit losses on investment securities were recorded for the current quarter.  

    Non-interest income increased $188,000, or 7%, to $2.88 million for the current quarter from $2.69 million for the preceding quarter and increased $84,000, or 3%, from $2.79 million for the comparable quarter one year ago. The increase in non-interest income compared to the preceding quarter was primarily due to an increase in ATM and debit card interchange transaction fees and smaller changes in several other categories. Fiscal year-to-date non-interest income increased by 1%, to $8.26 million from $8.20 million for the first nine months of fiscal 2024.

    Total operating (non-interest) expenses for the current quarter decreased $27,000 (less than 1%), to $11.17 million from $11.19 million for the preceding quarter and increased $98,000, or 1%, from $11.07 million for the comparable quarter one year ago.   The decrease in operating expenses compared to the preceding quarter was primarily due to decreases in salaries and employee benefits, premises and equipment, technology and communications, professional fees, and smaller decreases in several other expense categories. These decreases were partially offset by increases in state and local taxes and smaller increases in several other expense categories. The efficiency ratio for the current quarter improved to 54.48% from 56.25% for the preceding quarter and 58.97% for the comparable quarter one year ago. Fiscal year-to-date operating expenses increased 2% to $33.43 million from $32.68 million for the first nine months of fiscal 2024. The efficiency ratio for the first nine months of fiscal 2025 improved to 55.65% from 58.55% for the first nine months of fiscal 2024.

    The provision for income taxes for the current quarter increased $85,000, or 5%, to $1.79 million from $1.71 million for the preceding quarter, primarily due to higher taxable income. Timberland’s effective income tax rate was 20.1% for the quarter ended June 30, 2025, compared to 20.2% for the quarter ended March 31, 2025 and 20.6% for the quarter ended June 30, 2024. Timberland’s effective income tax rate was 20.1% for the first nine months of fiscal 2025 compared to 20.2% for the first nine months of fiscal 2024.  

    Balance Sheet Management

    Total assets increased $24.46 million, or 1%, during the quarter to $1.96 billion at June 30, 2025 from $1.93 billion at March 31, 2025 and increased $56.56 million, or 3%, from $1.90 billion one year ago. The increase during the current quarter was primarily due to a $21.42 million increase in net loans receivable and smaller increases in several other categories.

    Liquidity

    Timberland has continued to maintain a strong liquidity position, both on-balance sheet and off-balance sheet. Liquidity, as measured by the sum of cash and cash equivalents, CDs held for investment, and available for sale investment securities, was 17.0% of total liabilities at June 30, 2025, compared to 16.9% at March 31, 2025, and 14.7% one year ago. Timberland also had secured borrowing line capacity of $674 million available through the FHLB and the Federal Reserve at June 30, 2025. With a strong and diversified deposit base, only 17% of Timberland’s deposits were uninsured or uncollateralized at June 30, 2025. (Note: This calculation excludes public deposits that are fully collateralized.)

    Loans

    Net loans receivable increased $21.42 million, or 2%, during the quarter to $1.44 billion at June 30, 2025 from $1.42 billion at March 31, 2025. This increase was primarily due to a $21.83 million increase in multi-family loans, a $5.67 million increase in commercial real estate loans, a $3.89 million increase in land loans and smaller increases in several other loan categories. These increases were partially offset by a $5.50 million decrease in construction loans, a $4.80 million decrease in commercial business loans, and smaller decreases in several other loan categories. The increase in multi-family loans was, in large part, due to several multi-family construction projects being completed and converting to permanent financing during the quarter.

    Loan Portfolio
    ($ in thousands)
     
      June 30, 2025   March 31, 2025   June 30, 2024
      Amount   Percent   Amount   Percent   Amount   Percent
    Mortgage loans:                      
    One- to four-family (a) $317,574     21%     $315,421     21%     $288,611     19%  
    Multi-family   200,418     13       178,590     12       177,950     12  
    Commercial   607,924     40       602,248     40       597,865     40  
    Construction – custom and                      
    owner/builder   128,900     8       114,401     7       128,222     9
    Construction – speculative
    one-to four-family    		   9,595     1       9,791     1       11,441     1  
    Construction – commercial   15,992     1       22,352     1       32,130     2  
    Construction – multi-family   32,731     2       46,602     3       35,631     2  
    Construction – land                      
    development   15,461     1       15,032     1       19,104     1  
    Land   36,193     2       32,301     2       32,384     2  
    Total mortgage loans   1,364,788     89       1,336,738     88       1,323,338     88  
                           
    Consumer loans:                      
    Home equity and second                      
    mortgage   47,511     3       47,458     3       43,679     3  
    Other   2,176     —       2,375     —       3,121     —  
    Total consumer loans   49,687     3       49,833     3       46,800     3  
                           
    Commercial loans:                      
    Commercial business loans   126,497     8       131,243     9       136,213     9  
    SBA PPP loans   101     —       156     —       314     —  
    Total commercial loans   126,598     8       131,399     9       136,527     9  
    Total loans   1,541,073     100%       1,517,970     100%       1,506,665     100%  
    Less:                      
    Undisbursed portion of                      
    construction loans in                      
    process   (76,272)           (75,042)           (87,196)      
    Deferred loan origination                      
    fees   (5,427)           (5,329)           (5,404)      
    Allowance for credit losses   (17,878)           (17,525)           (17,046)      
    Total loans receivable, net $1,441,496         $1,420,074         $1,397,019      

    _______________________
    (a)   Does not include one- to four-family loans held for sale totaling $1,763, $1,151, and $1,795 at June 30, 2025, March 31, 2025, and June 30, 2024, respectively.  

    The following table provides a breakdown of commercial real estate (“CRE”) mortgage loans by collateral type as of June 30, 2025:

    CRE Loan Portfolio Breakdown by Collateral
    ($ in thousands)
    Collateral Type   Balance   Percent of
    CRE
    Portfolio    		   Percent of
    Total Loan
    Portfolio    		   Average
    Balance Per
    Loan    		   Non-
    Accrual
    Industrial warehouses   $128 822   21%     8%     $1 301   $161
    Medical/dental offices     81 238   13     5       1 269     —
    Office buildings     68 916   11     5       801     —
    Other retail buildings     54 472   9     3       567     —
    Mini-storage     38 483   6     2       1 539     —
    Hotel/motel     31 656   5     2       2 638     —
    Restaurants     27 485   5     2       585     —
    Gas stations/conv. stores     24 359   4     2       1 015     —
    Churches     14 690   3     1       918     —
    Nursing homes     13 532   2     1       2 255     —
    Shopping centers     10 507   2     1       1 751     —
    Mobile home parks     8 882   2     1       444     —
    Additional CRE     104 882   17     7       760     —    
    Total CRE   $607 924   100%     40%     $951   $161

    Timberland originated $81.99 million in loans during the quarter ended June 30, 2025, compared to $56.76 million for the preceding quarter and $74.32 million for the comparable quarter one year ago. Timberland continues to originate fixed-rate one- to four-family mortgage loans, a portion of which are sold into the secondary market for asset-liability management purposes and to generate non-interest income.   During the current quarter, fixed-rate one- to four-family mortgage loans totaling $5.11 million were sold compared to $5.17 million for the preceding quarter and $3.05 million for the comparable quarter one year ago.

    Investment Securities
            
    Timberland’s investment securities and CDs held for investment increased $2.04 million, or 1%, to $237.36 million at June 30, 2025, from $235.33 million at March 31, 2025. The increase was primarily due to the purchase of additional U.S. government agency mortgage-backed investment securities and U.S. Treasury investment securities. Partially offsetting these increases was the sale of $13.49 million available for sale investment securities, which resulted in a net gain of $24,000.

    Deposits

    Total deposits increased $18.65 million, or 1%, during the quarter to $1.67 billion at June 30, 2025, from $1.65 billion at March 31, 2025. The quarter’s increase consisted of a $16.01 million increase in certificates of deposit account balances, a $4.66 million increase in money market account balances, and a $1.60 million increase in NOW checking account balances. These decreases were partially offset by a $2.03 million decrease in savings account balances and a $1.59 million decrease in non-interest-bearing checking account balances.

    Deposit Breakdown
    ($ in thousands)
     
          June 30, 2025   March 31, 2025   June 30, 2024  
          Amount    Percent   Amount   Percent   Amount   Percent  
    Non-interest-bearing demand     $406,222   24%   $407,811   25%   $407,125   25%  
    NOW checking     334,922   20   333,325   20   324,795   20  
    Savings     205,829   12   207,857   13   207,921   13  
    Money market     305,207   18   300,552   18   327,162   20  
    Certificates of deposit under $250     244,063   15   227,137   14   195,022   12  
    Certificates of deposit $250 and over     126,254   8   124,009   7   117,788   7  
    Certificates of deposit – brokered     46,980   3   50,139   3   48,731   3  
    Total deposits     $1,669,477   100%   $1,650,830   100%   $1,628,544   100%  

    Borrowings

    Total borrowings were $20.00 million at both June 30, 2025 and March 31, 2025. At June 30, 2025, the weighted average rate on the borrowings was 3.97%.

    Shareholders’ Equity and Capital Ratios

    Total shareholders’ equity increased $4.14 million, or 2%, to $256.66 million at June 30, 2025, from $252.52 million at March 31, 2025, and increased $15.44 million, or 6%, from $241.22 million at June 30, 2024.   The increase in shareholders’ equity during the quarter was primarily due to net income of $7.10 million, which was partially offset by the payment of $2.05 million in dividends to shareholders and the repurchase of 34,236 shares of common stock for $1.02 million (an average price of $29.74 per share).

    Timberland remains well capitalized with a total risk-based capital ratio of 20.54%, a Tier 1 leverage capital ratio of 12.63%, a tangible common equity to tangible assets ratio (non-GAAP) of 12.42%, and a shareholders’ equity to total assets ratio of 13.11% at June 30, 2025.   Timberland’s held to maturity investment securities were $141.57 million at June 30, 2025, with a net unrealized loss of $5.99 million (pre-tax). Although not permitted by U.S. Generally Accepted Accounting Principles (“GAAP”), including these unrealized losses in accumulated other comprehensive income (loss) (“AOCI”) would result in a ratio of shareholders’ equity to total assets of 12.90%, compared to 13.11%, as reported.

    New Stock Repurchase Program

    The Company announced a new stock repurchase program today. Under the repurchase program, the Company may repurchase up to 5% of the Company’s outstanding shares, or 393,842 shares. The new stock repurchase program replaces the existing stock repurchase program which had 31,762 shares available to be repurchased.

    The repurchase program permits shares to be repurchased in open market or private transactions, through block trades, and pursuant to any trading plan that may be adopted in accordance with Rule 10b5-1 of the Securities and Exchange Commission (“SEC”). Repurchases will be made at management’s discretion at prices management considers to be attractive and in the best interest of both the Company and its shareholders, subject to the availability of stock, general market conditions, the trading price of the stock, alternative uses for capital, and the Company’s financial performance. Open market purchases will be conducted in accordance with the limitations set forth in Rule 10b-18 of the SEC and other applicable legal requirements. The repurchase program may be suspended, terminated, or modified at any time for any reason, including market conditions, the cost of repurchasing the shares, the availability of alternative investment opportunities, liquidity, and other factors deemed appropriate. These factors may also affect the timing and amount of share repurchases. The repurchase program does not obligate the Company to purchase any particular number of shares.

    Asset Quality
    Timberland’s non-performing assets to total assets ratio was 0.21% at June 30, 2025, compared to 0.13% at March 31, 2025 and 0.22% at June 30, 2024.   Net recoveries totaled $1,000 for the current quarter compared to net charge-offs of less than $1,000 for the preceding quarter and net charge-offs of $36,000 for the comparable quarter one year ago. During the current quarter, provisions for credit losses of $351,000 on loans and $93,000 unfunded commitments were made, which was partially offset by a $4,000 recapture of credit losses on investment securities. The allowance for credit losses (“ACL”) for loans as a percentage of loans receivable was 1.23% at June 30, 2025, compared to 1.22% at March 31, 2025 and 1.21% one year ago.

    Total delinquent loans (past due 30 days or more) and non-accrual loans increased $2.86 million or 86%, to $6.18 million at June 30, 2025, from $3.32 million at March 31, 2025 and increased $1.95 million, or 46%, from $4.23 million at June 30, 2024. Non-accrual loans increased $1.52 million, or 65%, to $3.84 million at June 30, 2025 from $2.33 million at March 31, 2025 and decreased $277,000, or 7%, from $4.12 million at March 31, 2024.   The quarterly increase in non-accrual loans was primarily due to one loan (secured by several single family homes) being past maturity. The loan is well collateralized (based on recent appraisals) and the Bank is working with the borrower to renew the loan. Loans graded “Substandard” totaled $32.37 million (or 2% of total loans receivable) at June 30, 2025.

    Non-Accrual Loans
    ($ in thousands)
     
      June 30, 2025   March 31, 2025   June 30, 2024
      Amount   Quantity   Amount   Quantity   Amount   Quantity
    Mortgage loans:                      
    One- to four-family $1,781   1   $47   1   $135   2
    Commercial   161   2     324   3     1,310   4
    Construction – custom and                      
    owner/builder   —   —     —   —     152   1
    Total mortgage loans   1,942   3     371   4     1,597   7
                           
    Consumer loans:                      
    Home equity and second                      
    mortgage   575   3     575   3     615   3
    Other   —   —     —   —     —   —
    Total consumer loans   575   3     575   3     615   3
                           
    Commercial business loans   1,326   9     1,381   11     1,908   8
    Total loans $3,843   15   $2,327   18   $4,120   18

            
    Timberland had two properties classified as other real estate owned (“OREO”) at June 30, 2025:

      June 30, 2025   March 31, 2025   June 30, 2024
      Amount   Quantity   Amount   Quantity   Amount   Quantity
    Other real estate owned:                      
    Commercial $221   1   $221   1   $ —   —
    Land   —   1     —   1     —   1
    Total mortgage loans $221   2   $221   2   $ —   1

    About Timberland Bancorp, Inc.
    Timberland Bancorp, Inc., a Washington corporation, is the holding company for Timberland Bank. The Bank opened for business in 1915 and primarily serves consumers and businesses across Grays Harbor, Thurston, Pierce, King, Kitsap and Lewis counties, Washington with a full range of lending and deposit services through its 23 branches (including its main office in Hoquiam).    

    Disclaimer
    Certain matters discussed in this press release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements relate to our financial condition, results of operations, plans, objectives, future performance or business. Forward-looking statements are not statements of historical fact, are based on certain assumptions and often include the words “believes,” “expects,” “anticipates,” “estimates,” “forecasts,” “intends,” “plans,” “targets,” “potentially,” “probably,” “projects,” “outlook” or similar expressions or future or conditional verbs such as “may,” “will,” “should,” “would” and “could.” Forward-looking statements include statements with respect to our beliefs, plans, objectives, goals, expectations, assumptions and statements about future economic performance. These forward-looking statements are subject to known and unknown risks, uncertainties and other factors that could cause our actual results to differ materially from the results anticipated or implied by our forward-looking statements, including, but not limited to: potential adverse impacts to economic conditions in our local market areas, other markets where the Company has lending relationships, or other aspects of the Company’s business operations or financial markets, including, without limitation, as a result of employment levels, labor shortages and the effects of inflation, a potential recession or slowed economic growth; continuing elevated levels of inflation and the impact of current and future monetary policies of the Board of Governors of the Federal Reserve System (“Federal Reserve”) in response thereto; the effects of any federal government shutdown; credit risks of lending activities, including any deterioration in the housing and commercial real estate markets which may lead to increased losses and non-performing loans in our loan portfolio resulting in our ACL not being adequate to cover actual losses and thus requiring us to materially increase our ACL through the provision for credit losses; changes in general economic conditions, either nationally or in our market areas; changes in the levels of general interest rates, and the relative differences between short and long-term interest rates, deposit interest rates, our net interest margin and funding sources; fluctuations in the demand for loans, the number of unsold homes, land and other properties and fluctuations in real estate values in our market areas; secondary market conditions for loans and our ability to sell loans in the secondary market; results of examinations of us by the Federal Reserve and of our bank subsidiary by the Federal Deposit Insurance Corporation (“FDIC”), the Washington State Department of Financial Institutions, Division of Banks or other regulatory authorities, including the possibility that any such regulatory authority may, among other things, institute a formal or informal enforcement action against us or our bank subsidiary which could require us to increase our ACL, write-down assets, change our regulatory capital position or affect our ability to borrow funds or maintain or increase deposits or impose additional requirements or restrictions on us, any of which could adversely affect our liquidity and earnings; the impact of bank failures or adverse developments at other banks and related negative press about the banking industry in general on investor and depositor sentiment; legislative or regulatory changes that adversely affect our business including changes in banking, securities and tax law, in regulatory policies and principles, or the interpretation of regulatory capital or other rules; our ability to attract and retain deposits; our ability to control operating costs and expenses; the use of estimates in determining fair value of certain of our assets, which estimates may prove to be incorrect and result in significant declines in valuation; difficulties in reducing risks associated with the loans in our consolidated balance sheet; staffing fluctuations in response to product demand or the implementation of corporate strategies that affect our work force and potential associated charges; disruptions, security breaches, or other adverse events, failures or interruptions in, or attacks on, our information technology systems or on the third-party vendors who perform several of our critical processing functions; our ability to retain key members of our senior management team; costs and effects of litigation, including settlements and judgments; our ability to implement our business strategies; our ability to manage loan delinquency rates; increased competitive pressures among financial services companies; changes in consumer spending, borrowing and savings habits; the availability of resources to address changes in laws, rules, or regulations or to respond to regulatory actions; our ability to pay dividends on our common stock; the quality and composition of our securities portfolio and the impact if any adverse changes in the securities markets, including on market liquidity; inability of key third-party providers to perform their obligations to us; changes in accounting policies and practices, as may be adopted by the financial institution regulatory agencies or the Financial Accounting Standards Board (“FASB”), including additional guidance and interpretation on accounting issues and details of the implementation of new accounting methods; the economic impact of climate change, severe weather events, natural disasters, pandemics, epidemics and other public health crises, acts of war or terrorism, civil unrest and other external events on our business; other economic, competitive, governmental, regulatory, and technological factors affecting our operations, pricing, products and services; and other risks described elsewhere in this press release and in the Company’s other reports filed with or furnished to the Securities and Exchange Commission.

    Any of the forward-looking statements that we make in this press release and in the other public statements we make are based upon management’s beliefs and assumptions at the time they are made. We do not undertake and specifically disclaim any obligation to publicly update or revise any forward-looking statements included in this press release to reflect the occurrence of anticipated or unanticipated events or circumstances after the date of such statements or to update the reasons why actual results could differ from those contained in such statements, whether as a result of new information, future events or otherwise. In light of these risks, uncertainties and assumptions, the forward-looking statements discussed in this document might not occur and we caution readers not to place undue reliance on any forward-looking statements. These risks could cause our actual results for fiscal 2025 and beyond to differ materially from those expressed in any forward-looking statements by, or on behalf of, us, and could negatively affect the Company’s consolidated financial condition and results of operations as well as its stock price performance.

    TIMBERLAND BANCORP INC. AND SUBSIDIARY
    CONSOLIDATED STATEMENTS OF INCOME    		   Three Months Ended
    ($ in thousands, except per share amounts) (unaudited)   June 30,   March 31,   June 30,
          2025       2025       2024  
      Interest and dividend income            
      Loans receivable   $21,411     $20,896     $19,537  
      Investment securities     2,064       2,003       2,335  
      Dividends from mutual funds, FHLB stock and other investments     83       82       94  
      Interest bearing deposits in banks     1,986       1,884       2,173  
      Total interest and dividend income     25,544       24,865       24,139  
                   
      Interest expense            
      Deposits     7,721       7,454       7,938  
      Borrowings     201       198       220  
      Total interest expense     7,922       7,652       8,158  
      Net interest income     17,622       17,213       15,981  
      Provision for credit losses – loans     351       237       264  
      Recapture of credit losses – investment securities     (4)       (5)       (12)  
      Prov. for (recapture of ) credit losses – unfunded commitments     93       14       (8)  
      Net int. income after provision for (recapture of) credit losses     17,182       16,967       15,737  
                   
      Non-interest income            
      Service charges on deposits     966       959       1,014  
      ATM and debit card interchange transaction fees     1,262       1,176       1,297  
      Gain on sales of investment securities, net     24       —       —  
      Gain on sales of loans, net     138       122       68  
      Bank owned life insurance (“BOLI”) net earnings     171       165       158  
      Other     314       265       254  
      Total non-interest income, net     2,875       2,687       2,791  
                   
      Non-interest expense            
      Salaries and employee benefits     5,825       5,977       5,928  
      Premises and equipment     973       1,075       1,011  
      Gain on sale of premises and equipment, net     —       —       (3)  
      Advertising     182       189       211  
      OREO and other repossessed assets, net     8       9       —  
      ATM and debit card processing     658       521       580  
      Postage and courier     137       142       130  
      State and local taxes     570       335       335  
      Professional fees     341       431       335  
      FDIC insurance     211       219       208  
      Loan administration and foreclosure     99       155       156  
      Technology and communications     993       1,121       1,086  
      Deposit operations     345       319       450  
      Amortization of core deposit intangible (“CDI”)     45       45       56  
      Other, net     780       656       586  
      Total non-interest expense, net     11,167       11,194       11,069  
                   
      Income before income taxes     8,890       8,460       7,459  
      Provision for income taxes     1,790       1,705       1,535  
      Net income   $7,100     $6,755     $5,924  
                   
      Net income per common share:            
      Basic   $0.90     $0.85     $0.74  
      Diluted     0.90       0.85       0.74  
                   
      Weighted average common shares outstanding:            
      Basic     7,893,308       7,937,063       8,004,552  
      Diluted     7,921,762       7,968,632       8,039,345  
    TIMBERLAND BANCORP INC. AND SUBSIDIARY
    CONSOLIDATED STATEMENTS OF INCOME    		   Nine Months Ended
    ($ in thousands, except per share amounts) (unaudited)   June 30,   June 30,
          2025       2024  
      Interest and dividend income        
      Loans receivable   $63,339     $56,841  
      Investment securities     6,205       6,892  
      Dividends from mutual funds, FHLB stock and other investments     252       266  
      Interest bearing deposits in banks     5,870       5,791  
      Total interest and dividend income     75,666       69,790  
               
      Interest expense        
      Deposits     23,259       21,383  
      Borrowings     602       787  
      Total interest expense     23,861       22,170  
      Net interest income     51,805       47,620  
      Provision for credit losses – loans     640       810  
      Recapture of credit losses – investment securities     (14)       (20)  
      Prov. for (recapture of) credit losses – unfunded commitments     87       (130)  
      Net int. income after provision for (recapture of) credit losses     51,092       46,960  
               
      Non-interest income        
      Service charges on deposits     2,924       3,024  
      ATM and debit card interchange transaction fees     3,706       3,773  
      Gain on sales of investment securities, net     24       —  
      Gain on sales of loans, net     303       188  
      Bank owned life insurance (“BOLI”) net earnings     503       470  
      Other     799       749  
      Total non-interest income, net     8,259       8,204  
               
      Non-interest expense        
      Salaries and employee benefits     17,893       17,863  
      Premises and equipment     2,998       3,065  
      Gain on sale of premises and equipment, net     —       (3)  
      Advertising     552       556  
      OREO and other repossessed assets, net     17       1  
      ATM and debit card processing     1,700       1,796  
      Postage and courier     401       401  
      State and local taxes     1,251       979  
      Professional fees     1,118       908  
      FDIC insurance     640       624  
      Loan administration and foreclosure     383       395  
      Technology and communications     3,253       3,101  
      Deposit operations     997       1,094  
      Amortization of core deposit intangible (“CDI”)     135       169  
      Other, net     2,090       1,735  
      Total non-interest expense, net     33,428       32,684  
               
      Income before income taxes     25,923       22,480  
      Provision for income taxes     5,208       4,552  
      Net income   $20,715     $17,928  
               
      Net income per common share:        
      Basic   $2.61     $2.22  
      Diluted     2.60       2.21  
               
      Weighted average common shares outstanding:        
      Basic     7,929,626       8,067,068  
      Diluted     7,963,412       8,109,043  
    TIMBERLAND BANCORP INC. AND SUBSIDIARY
    CONSOLIDATED BALANCE SHEETS    		  
    ($ in thousands, except per share amounts) (unaudited)   June 30,   March 31,   June 30,
          2025       2025       2024  
    Assets            
    Cash and due from financial institutions   $32,532     $26,010     $25,566  
    Interest-bearing deposits in banks     161,095       165,201       133,347  
      Total cash and cash equivalents     193,627       191,211       158,913  
                   
    Certificates of deposit (“CDs”) held for investment, at cost     8,462       8,711       10,458  
    Investment securities:            
      Held to maturity, at amortized cost (net of ACL – investment securities)     141,570       140,954       176,787  
      Available for sale, at fair value     86,475       84,807       74,515  
    Investments in equity securities, at fair value     855       853       836  
    FHLB stock     2,045       2,045       2,037  
    Other investments, at cost     3,000       3,000       3,000  
    Loans held for sale     1,763       1,151       1,795  
                 
    Loans receivable     1,459,374       1,437,599       1,414,065  
    Less: ACL – loans     (17,878)       (17,525)       (17,046)  
      Net loans receivable     1,441,496       1,420,074       1,397,019  
                   
    Premises and equipment, net     21,490       21,436       21,558  
    OREO and other repossessed assets, net     221       221       —  
    BOLI     24,113       23,942       23,436  
    Accrued interest receivable     7,174       7,127       7,045  
    Goodwill     15,131       15,131       15,131  
    CDI     316       361       508  
    Loan servicing rights, net     911       1,051       1,526  
    Operating lease right-of-use assets     1,248       1,324       1,550  
    Other assets     7,295       9,331       4,515  
      Total assets   $1,957,192     $1,932,730     $1,900,629  
                   
    Liabilities and shareholders’ equity            
    Deposits: Non-interest-bearing demand   $406,222     $407,811     $407,125  
    Deposits: Interest-bearing     1,263,255       1,243,019       1,221,419  
      Total deposits     1,669,477       1,650,830       1,628,544  
                   
    Operating lease liabilities     1,350       1,426       1,649  
    FHLB borrowings     20,000       20,000       20,000  
    Other liabilities and accrued expenses     9,701       7,950       9,213  
      Total liabilities     1,700,528       1,680,206       1,659,406  
                 
    Shareholders’ equity            
    Common stock, $.01 par value; 50,000,000 shares authorized;
            7,876,853 shares issued and outstanding – June 30, 2025
            7,903,489 shares issued and outstanding – March 31, 2025
            7,953,431 shares issued and outstanding – June 30, 2024    		     27,226       28,028       30,681  
    Retained earnings     230,213       225,166       211,087  
    Accumulated other comprehensive loss     (775)       (670)       (545)  
      Total shareholders’ equity     256,664       252,524       241,223  
      Total liabilities and shareholders’ equity   $1,957,192     $1,932,730     $1,900,629  
      Three Months Ended
    PERFORMANCE RATIOS:   June 30, 2025   March 31, 2025   June 30, 2024
    Return on average assets (a)     1.47%       1.43%       1.25%  
    Return on average equity (a)     11.23%       10.95%       9.95%  
    Net interest margin (a)     3.80%       3.79%       3.53%  
    Efficiency ratio     54.48%       56.25%       58.97%  
                 
      Nine Months Ended
        June 30, 2025       June 30, 2024
    Return on average assets (a)     1.44%           1.27%  
    Return on average equity (a)     11.07%           10.10%  
    Net interest margin (a)     3.74%           3.53%  
    Efficiency ratio     55.65%           58.55%  
                 
      Three Months Ended
    ASSET QUALITY RATIOS AND DATA: ($ in thousands)   June 30, 2025   March 31, 2025   June 30, 2024
    Non-accrual loans   $3,843     $2,327     $4,120  
    Loans past due 90 days and still accruing     —       —       —  
    Non-performing investment securities     38       41       72  
    OREO and other repossessed assets     221       221       —  
    Total non-performing assets (b)   $4,102     $2,589     $4,192  
                 
    Non-performing assets to total assets (b)     0.21%       0.13%       0.22%  
    Net charge-offs (recoveries) during quarter   $(1)     $ —     $36  
    Allowance for credit losses – loans to non-accrual loans     465%       753%       414%  
    Allowance for credit losses – loans to loans receivable (c)     1.23%       1.22%       1.21%  
                 
                 
    CAPITAL RATIOS:            
    Tier 1 leverage capital     12.63%       12.55%       12.04%  
    Tier 1 risk-based capital     19.29%       19.04%       17.97%  
    Common equity Tier 1 risk-based capital     19.29%       19.04%       17.97%  
    Total risk-based capital     20.54%       20.29%       19.22%  
    Tangible common equity to tangible assets (non-GAAP)     12.42%       12.36%       11.97%  
                 
    BOOK VALUES:            
    Book value per common share   $32.58     $31.95     $30.33  
    Tangible book value per common share (d)     30.62       29.99       28.36  

    ________________________________________________

    (a) Annualized
    (b) Non-performing assets include non-accrual loans, loans past due 90 days and still accruing, non-performing investment securities and OREO and other repossessed assets.
    (c) Does not include loans held for sale and is before the allowance for credit losses.
    (d) Tangible common equity divided by common shares outstanding (non-GAAP).                                

    AVERAGE BALANCES, YIELDS, AND RATES – QUARTERLY
    ($ in thousands)
    (unaudited)

      For the Three Months Ended 
      June 30, 2025    March 31, 2025    June 30, 2024 
      Amount   Rate   Amount   Rate   Amount   Rate
                           
    Assets                      
    Loans receivable and loans held for sale $ 1,450,350     5.92 %   $ 1,435,999     5.90 %   $ 1,391,582     5.65 %
    Investment securities and FHLB stock (1)   232,272     3.71       232,532     3.64             268,954     3.63  
    Interest-earning deposits in banks and CDs   178,887     4.45       172,175     4.44       161,421     5.41  
    Total interest-earning assets   1,861,509     5.50       1,840,706     5.48            1,821,957     5.33  
    Other assets         79,715           77,563           82,008      
    Total assets $ 1,941,224         $ 1,918,269         $ 1,903,965      
                           
    Liabilities and Shareholders’ Equity                      
    NOW checking accounts $ 333,074     1.39 %   $ 328,115     1.32 %   $ 329,344     1.29 %
    Money market accounts   304,526     3.16       306,137     3.18       326,023     3.56  
    Savings accounts   205,592     0.35       206,054     0.28       208,488     0.27  
    Certificates of deposit accounts   363,342     3.77       343,945     3.82       311,545     4.21  
    Brokered CDs   48,028     4.83       50,104     4.85       45,442     5.32  
    Total interest-bearing deposits   1,254,562     2.47       1,234,355     2.45       1,220,842     2.62  
    Borrowings   20,002     4.03       20,000     4.04       20,001     4.42  
    Total interest-bearing liabilities   1,274,564     2.49       1,254,355     2.47       1,240,843     2.64  
                           
    Non-interest-bearing demand deposits   402,717           403,738           413,494      
    Other liabilities   10,266           10,064           10,245      
    Shareholders’ equity   253,677           250,112           239,383      
    Total liabilities and shareholders’ equity $ 1,941,224         $ 1,918,269         $ 1,903,965      
                           
    Interest rate spread     3.01 %       3.01 %       2.69 %
    Net interest margin (2)     3.80 %       3.79 %       3.53 %
    Average interest-earning assets to                      
    average interest-bearing liabilities   146.05 %         146.75 %         146.83 %    

               _____________________________________
    (1) Includes other investments
    (2) Net interest margin = annualized net interest income /
          average interest-earning assets
            

    AVERAGE BALANCES, YIELDS, AND RATES
    ($ in thousands)
    (unaudited)

      For the Nine Months Ended 
      June 30, 2025    June 30, 2024 
      Amount   Rate   Amount   Rate
                   
    Assets              
    Loans receivable and loans held for sale $ 1,441,506     5.87 %   $ 1,363,213     5.57 %
    Investment securities and FHLB stock (1)   237,400     3.81             294,789     3.24  
    Interest-earning deposits in banks and CDs       172,591     4.55       143,537     5.39  
    Total interest-earning assets        1,851,497     5.49            1,801,539     5.17  
    Other assets   77,595           81,650      
    Total assets $ 1,929,092         $ 1,883,189      
                   
    Liabilities and Shareholders’ Equity              
    NOW checking accounts $ 329,883     1.36 %   $ 358,052     1.48 %
    Money market accounts   311,762     3.26       273,683     3.09  
    Savings accounts   205,764     0.30       214,275     0.24  
    Certificates of deposit accounts   346,313     3.89       291,707     4.12  
    Brokered CDs   48,169     4.71       42,856     5.37  
    Total interest-bearing deposits   1,241,891     2.50       1,180,573     2.42  
    Borrowings   20,001     4.02       22,457     4.68  
    Total interest-bearing liabilities   1,261,892     2.53       1,203,030     2.46  
                   
    Non-interest-bearing demand deposits   406,906           431,849      
    Other liabilities             10,159           11,273      
    Shareholders’ equity   250,135           237,037      
    Total liabilities and shareholders’ equity $ 1,929,092         $ 1,883,189      
                   
    Interest rate spread     2.96 %       2.71 %
    Net interest margin (2)     3.74 %       3.53 %
    Average interest-earning assets to              
    average interest-bearing liabilities   146.72 %         149.75 %    

    _____________________________________
    (1) Includes other investments
    (2) Net interest margin = annualized net interest income /
    average interest-earning assets

    Non-GAAP Financial Measures
    In addition to results presented in accordance with GAAP, this press release contains certain non-GAAP financial measures. Timberland believes that certain non-GAAP financial measures provide investors with information useful in understanding the Company’s financial performance; however, readers of this report are urged to review these non-GAAP financial measures in conjunction with GAAP results as reported.

    Financial measures that exclude intangible assets are non-GAAP measures. To provide investors with a broader understanding of capital adequacy, Timberland provides non-GAAP financial measures for tangible common equity, along with the GAAP measure. Tangible common equity is calculated as shareholders’ equity less goodwill and CDI. In addition, tangible assets equal total assets less goodwill and CDI.

    The following table provides a reconciliation of ending shareholders’ equity (GAAP) to ending tangible shareholders’ equity (non-GAAP) and ending total assets (GAAP) to ending tangible assets (non-GAAP).

    ($ in thousands)   June 30, 2025   March 31, 2025   June 30, 2024
                 
    Shareholders’ equity   $ 256,664     $ 252,524     $ 241,223  
    Less goodwill and CDI     (15,447)       (15,492)       (15,639)  
    Tangible common equity   $ 241,217     $ 237,032     $ 225,584  
                 
    Total assets   $ 1,957,192     $ 1,932,730     $ 1,900,629  
    Less goodwill and CDI     (15,447)       (15,492)       (15,639)  
    Tangible assets   $ 1,941,745     $ 1,917,238     $ 1,884,990  

    Contact: Dean J. Brydon, CEO 
    Jonathan A. Fischer, President & COO
     Marci A. Basich, CFO 
    (360) 533-4747 
    www.timberlandbank.com

    The MIL Network –

  • MIL-OSI USA: Luján Secures Nearly $190 Million in Federal Investments for New Mexico in Committee-Passed Appropriations Bills

    US Senate News:

    Source: United States Senator Ben Ray Luján (D-New Mexico)

    Washington, D.C. – Today, U.S. Senator Ben Ray Luján (D-N.M.) announced funding secured for New Mexico communities through the Appropriations Committee’s bipartisan passage of the Fiscal Year (FY) 2026 Military Construction, Veterans Affairs, and Related Agencies (MilCon-VA) Appropriations Bill and Fiscal Year (FY) 2026 Commerce, Justice, Science, and Related Agencies (CJS) Appropriations Bill.

    From both appropriations bills, Senator Luján secured $189,820,000 for key local projects that will strengthen our national security, boost violence intervention programs, and equip law enforcement with the resources needed to keep New Mexico communities safe.  

    “Across New Mexico, these vital investments will deliver resources to enhance public safety in our communities and upgrade infrastructure at our military bases to boost our military’s readiness and safety,” said Senator Luján. “This funding will equip our brave law enforcement officers with the tools they need to protect New Mexicans, support programs aimed at reducing youth violence and violence in Tribal communities, and reinforce critical infrastructure at our military bases. I’m proud to have fought to secure these investments for our communities, and I’ll continue working to deliver the federal support our families and communities need and deserve.”

    The Committee process is the first step, and the appropriations bills will next be considered by the full U.S. Senate.

    Senator Luján Secured Nearly $190 Million for the Following Local Projects:

    Strengthening New Mexico’s Air Force Bases:

    • $90,000,000 for Cannon Air Force Base to construct a 192-bed dormitory. Secured by Senator Luján and Senator Heinrich.
    • $83,000,000 for Kirtland Air Force Base to construct a Space Rapid Capabilities Office. Secured by Senator Luján and Senator Heinrich.
    • $8,100,000 for infrastructure upgrades at Cannon Air Force Base, specifically for ADAL Security Forces Facility. Secured by Senator Luján and Senator Heinrich.
    • $2,000,000 for infrastructure upgrades at Kirtland Air Force Base, specifically for the design for the Wyoming Gate Project. Secured by Senator Luján and Senator Heinrich.
    • $700,000 for infrastructure upgrades at Holloman Air Force Base, specifically for the design for the Holloman High Speed Test Track. Secured by Senator Luján and Senator Heinrich.

    Boosting Public Safety Throughout New Mexico:

    • $1,069,000 for the City of Albuquerque’s Real Time Crime Center for the purchase of law enforcement technology.
    • $1,042,000 for Bernalillo County Sheriff’s Office to purchase a new fleet of vehicles.
    • $1,031,000 for the New Mexico Department of Public Safety Police to provide 5G technology in fleet vehicles. Secured by Senator Luján, Senator Heinrich, and Representative Stansbury in the House-companion bill.
    • $1,000,000 for UNM Office of the Medical Investigator DNA processing laboratory to allow for the purchase of equipment for DNA identification. Secured by Senator Luján and Senator Heinrich.
    • $500,000 for Bernalillo County public safety technology upgrades to address high rates of crime in the Albuquerque metro area. Secured by Senator Luján, Senator Heinrich, and Representative Vasquez in the House-companion bill.
    • $250,000 for the San Juan County Partnership’s Law Enforcement Assisted Diversion (LEAD) program to assist in mitigating individuals with substance use disorder or mental/behavioral health challenges from continuously interacting with law enforcement.

    Funding Violence Intervention and Prevention Programs:

    • $1,0350,000 for the City of Albuquerque’s expansion of school-based violence intervention program to assist at risk students by improving grades and reducing youth violence.
    • $93,000 for the Coalition to Stop Violence Against Native women to address challenges in domestic violence and sexual violence in Tribal communities.

    MIL OSI USA News –

  • MIL-OSI: Weatherford Announces Second Quarter 2025 Results

    Source: GlobeNewswire (MIL-OSI)

    • Second quarter revenue of $1,204 million increased 1% sequentially
    • Second quarter operating income of $237 million increased 67% sequentially
    • Second quarter net income of $136 million increased 79% sequentially; net income margin of 11.3%
    • Second quarter adjusted EBITDA* of $254 million was flat sequentially; adjusted EBITDA margin* of 21.1% decreased 11 basis points sequentially
    • Second quarter cash provided by operating activities of $128 million and adjusted free cash flow* of $79 million
    • Repurchased $27 million of 8.625% Senior Notes due 2030 in the second quarter of 2025
    • Shareholder return of $52 million for the quarter, which included dividend payments of $18 million and share repurchases of $34 million
    • Board approved quarterly cash dividend of $0.25 per share, payable on September 4, 2025, to shareholders of record as of August 6, 2025
    • Signed an agreement with Amazon Web Services to migrate and modernize our digital platforms, including the Modern Edge Platform and Unified Data Model, enhancing operational efficiency and data-driven decision-making. The collaboration also boosts Weatherford’s Software Launchpad, offering scalable, cloud-based solutions while ensuring data control and integration flexibility

    *Non-GAAP – refer to the section titled Non-GAAP Financial Measures Defined and GAAP to Non-GAAP Financial Measures Reconciled

    HOUSTON, July 22, 2025 (GLOBE NEWSWIRE) — Weatherford International plc (NASDAQ: WFRD) (“Weatherford” or the “Company”) announced today its results for the second quarter of 2025.

    Revenues for the second quarter of 2025 were $1,204 million, an increase of 1% sequentially and a decrease of 14% year-over-year. Operating income in the second quarter of 2025 was $237 million, an increase of 67% sequentially and a decrease of 10% year-over-year. Net income in the second quarter of 2025 was $136 million, with a 11.3% margin, an increase of 79%, or 493 basis points, sequentially, and an increase of 9%, or 240 basis points, year-over-year. Adjusted EBITDA* was $254 million, with a 21.1% margin, flat, or a decrease of 11 basis points, sequentially, and a decrease of 30%, or 488 basis points, year-over-year. Basic income per share in the second quarter of 2025 was $1.87, an increase of 81% sequentially and an increase of 10% year-over-year. Diluted income per share in the second quarter of 2025 was $1.87, an increase of 81% sequentially and an increase of 13% year-over-year.

    Second quarter 2025 cash flows provided by operating activities were $128 million, a decrease of 10% sequentially and a decrease of 15% year-over-year. Adjusted free cash flow* was $79 million, an increase of 20% sequentially and a decrease of 18% year-over-year. Capital expenditures were $54 million in the second quarter of 2025, a decrease of 30% sequentially and a decrease of 13% year-over-year.

    Girish Saligram, President and Chief Executive Officer, commented, “Our core operating markets continued to exhibit activity slowdown during the quarter, driven by geopolitical events, supply-demand imbalance concerns, and trade uncertainties. Despite these structural headwinds, the One Weatherford team delivered second-quarter results in line with expectations, reflecting disciplined execution and operational efficiency in a distinctly softer market. The sequential performance demonstrates strong fundamentals and the resilience of our operating model. Revenues increased and adjusted EBITDA was flat despite the previously announced divestiture of certain businesses in Argentina. Adjusted Free Cash Flow also increased, even as receivables continued to build in Latin America due to lack of payments in Mexico. This performance underscores the strength of the new Weatherford operating paradigm and marks a positive departure from past responses to prior market cycle inflections.

    Looking ahead, activity levels in both North America and international markets continue to show signs of sluggishness, and expectations for a broader sector recovery have shifted further to the right. While we anticipate a relatively flat trajectory on revenues for the immediate future, we remain focused on driving adjusted free cash flow conversion through portfolio optimization, structural cost efficiencies, optimization of working capital, and CAPEX efficiency.”

    *Non-GAAP – refer to the section titled Non-GAAP Financial Measures Defined and GAAP to Non-GAAP Financial Measures Reconciled

    Operational & Commercial Highlights

    • An International Oil Company (IOC) awarded Weatherford a three-year contract to provide Managed Pressure Drilling (MPD) services for a deepwater development project in Mexico.
    • Aramco awarded Weatherford a one-year contract extension to provide MPD services for its onshore and offshore wells.
    • Weatherford, with Superior Energy Services, secured a three-year contract to supply conventional completions (Upper and Lower) equipment to Petrobras for pre-salt and post-salt fields offshore Brazil.
    • Cairn Oil & Gas granted Weatherford a Letter of Award to provide Completions, Liner Hanger, Whipstock systems and services, and MPD services for High Temperature – Ultra High Temperature (HT-UHT) drilling and rigless project in Barmer, India.
    • bp UK awarded Weatherford a one-year contract to provide Cementation Products, Completions, Drilling Services, Intervention Services & Drilling Tools (ISDT), and a one-year contract to provide Liner Hanger systems for the Northern Endurance Partnership CO2 Storage Project in offshore UK.
    • Beach Energy Limited awarded Weatherford contracts to provide Cementation Products, Cement Heads, Liner Hangers, and Tubular Running Services (TRS) for a campaign in offshore Australia.
    • Origin Energy awarded Weatherford a five-year contract to re-supply PCP systems in onshore Australia.
    • OMV awarded Weatherford a three-year contract to supply Completions and Reservoir Monitoring equipment in Tunisia.
    • Shell awarded Weatherford a three-year contract to provide ISDT offshore in the Gulf of America.
    • An IOC awarded Weatherford a three-year contract to provide thru-tubing Well Services in offshore Malaysia.
    • Kuwait Oil Company (KOC) awarded Weatherford a contract for the supply of XpressTM XT Liner Hanger systems for deep drilling operations in Kuwait.
    • A National Oil Company in the Middle East awarded a two-year contract to provide thru-tubing and safety valve systems in the United Arab Emirates.
    • A major operator in Canada awarded Weatherford a two-year contract to provide Artificial Lift services in onshore Canada.
    • Weatherford, in strategic partnership with Constellation, secured a three-year contract to deliver TRS, integrating the automated Vero™ technology into their rig for Petrobras in offshore Brazil.

    Technology Highlights

    • Drilling & Evaluation (“DRE”)
      • In Kuwait, Weatherford successfully deployed combined Magnus™ and Victus™ solutions for a pilot project for KOC. This approach enabled the use of a smaller wellhead, eliminated one casing string, and allowed effective drilling and cementing through stacked reservoirs, potentially unlocking new completion designs and enhancing recovery.
      • In Qatar, Weatherford successfully completed the first Modus™ job using MPD techniques that significantly improved operational efficiency and well safety. The Modus system enabled the operator to reach the targeted total depth while saving substantial rig time and costs compared to conventional methods.
      • In Norway, Weatherford successfully completed three open hole logging jobs for an international operator using coiled tubing for deployment. This approach enabled effective logging in a highly deviated well, overcoming the limitations of conventional wireline conveyance.
    • Well Construction and Completions (“WCC”)
      • In the Gulf of America, Weatherford successfully integrated multiple TRS technologies for bp. This integration enhanced operational speed, cost-effectiveness, and well integrity while improving quality, efficiency, and safety by reducing personnel requirements and eliminating manual intervention.
      • In the United Kingdom, Weatherford successfully implemented StringGuardTM for Shell. The solution is designed to provide protection against potential dropped string events, with the aim of maintaining operational focus and incident free delivery.
    • Production and Intervention (“PRI”)
      • Weatherford’s Rotaflex® Artificial Lift technology has witnessed continued global adoption, with recent installations in France, Australia, and Oman. These projects have addressed a variety of operational challenges, including the replacement of Electric Submersible Pumps and conventional pumping units, enhancement of production efficiency, support for Coal Bed Methane initiatives, and restoration of output in complex wells, underscoring the versatility and effectiveness of the Rotaflex technology.
      • In Norway, Weatherford completed a successful field trial of TITAN RS technology for Equinor, following the acquisition of Ardyne. The trial delivered a full casing cut and recovery solution for the plug and abandonment market, reinforcing Weatherford’s leadership in advanced well abandonment.
      • In Saudi Arabia, Weatherford installed the first Rod Lift system in the Jafurah field. The unit was successfully commissioned, validating Weatherford’s Rod Lift technology as a viable artificial lift solution for this unconventional gas field.

    Shareholder Return

    During the second quarter of 2025, Weatherford paid dividends of $18 million and repurchased shares for approximately $34 million, resulting in a total shareholder return of $52 million. In the first half of the year, Weatherford paid dividends of $36 million and repurchased shares for approximately $87 million, resulting in a total shareholder return of $123 million.

    On July 17, 2025, our Board declared a cash dividend of $0.25 per share of the Company’s ordinary shares, payable on September 4, 2025, to shareholders of record as of August 6, 2025.

    Results by Reportable Segment

    Drilling and Evaluation (“DRE”)
      

        Three Months Ended   Variance
    ($ in Millions)   June 30,
    2025    		   March 31,
    2025    		   June 30,
    2024    		   Seq.   YoY
    Revenue   $          335     $              350     $          427     (4)   %   (22)    %
    Segment Adjusted EBITDA   $            69     $                 74     $          130     (7)   %   (47)    %
    Segment Adj EBITDA Margin     20.6 %     21.1 %     30.4 %            (55) bps         (985) bps

    Second quarter 2025 DRE revenue of $335 million decreased by $15 million, or 4% sequentially, primarily from lower Wireline activity in North America and Latin America partly offset by higher Drilling Services activity in Europe/Sub-Sahara Africa/Russia and Latin America. Year-over-year DRE revenue decreased by $92 million, or 22%, primarily from lower activity across all geographies, especially in Latin America, partly offset by higher Drilling Services activity in Europe/Sub-Sahara Africa/ Russia, North America and Middle East/North Africa/Asia.

    Second quarter 2025 DRE segment adjusted EBITDA of $69 million decreased by $5 million, or 7% sequentially, primarily from lower Wireline activity, partly offset by higher Drilling Services activity. Year-over-year DRE segment adjusted EBITDA decreased by $61 million, or 47%, primarily from lower activity across all geographies, especially in Latin America.

    Well Construction and Completions (“WCC”)  

        Three Months Ended   Variance
    ($ in Millions)   June 30,
    2025    		   March 31,
    2025    		   June 30,
    2024    		   Seq.   YoY
    Revenue   $          456     $              441     $          504     3 %   (10)   %
    Segment Adjusted EBITDA   $          118     $              128     $          145     (8) %   (19)   %
    Segment Adj EBITDA Margin     25.9 %     29.0 %     28.8 %         (315) bps          (289) bps

    Second quarter 2025 WCC revenue of $456 million increased by $15 million, or 3% sequentially, primarily from higher Liner Hangers and Cementation Products activity partly offset by lower Completions activity especially in Latin America.  Year-over-year WCC revenues decreased by $48 million, or 10%, primarily from lower activity in Latin America, Europe/Sub-Sahara Africa/Russia and North America partly offset by higher Liner Hangers activity in Middle East/North Africa/Asia.

    Second quarter 2025 WCC segment adjusted EBITDA of $118 million decreased by $10 million, or 8% sequentially, primarily from lower Completions activity partly offset by higher Liner Hangers activity and Cementation Products activity and fall through. Year-over-year WCC segment adjusted EBITDA decreased by $27 million, or 19%, primarily from lower activity in Latin America, Europe/Sub-Sahara Africa/Russia and North America partly offset by higher Liner Hangers and TRS fall through in Middle East/North Africa/Asia.

    Production and Intervention (“PRI”)  

        Three Months Ended   Variance
    ($ in Millions)   June 30,
    2025    		   March 31,
    2025    		   June 30,
    2024    		   Seq.   YoY
    Revenue   $          327         $              334     $          369     (2)  %   (11)   %
    Segment Adjusted EBITDA   $            63         $                 62     $            85     2 %   (26)   %
    Segment Adj EBITDA Margin     19.3 %     18.6 %     23.0 %             70  bps          (377) bps

    Second quarter 2025 PRI revenue of $327 million  decreased by $7 million, or 2% sequentially, primarily from lower Pressure Pumping activity in Latin America pursuant to the sale of the Argentina Pressure Pumping business partly offset by higher Artificial Lift and Sub-sea Intervention activity. Year-over-year PRI revenue decreased by $42 million, or 11%, as lower activity across all geographies was partly offset by higher Sub-sea intervention activity in Latin America.

    Second quarter 2025 PRI segment adjusted EBITDA of $63 million increased by $1 million, or 2% sequentially, primarily from  higher Sub-sea Intervention activity and fall through partly offset by lower Pressure Pumping activity in Latin America pursuant to the sale of the Argentina Pressure Pumping business. Year-over-year PRI segment adjusted EBITDA decreased by $22 million, or 26%, primarily from lower activity across all geographies, partly offset by higher Sub-sea intervention activity and fall through in Latin America.

    Revenue by Geography 

        Three Months Ended   Variance
    ($ in Millions)   June 30,
    2025    		   March 31,
    2025    		   June 30,
    2024    		   Seq.   YoY
    North America   $             241   $                  250   $             252   (4) %   (4) %
                         
    International   $             963   $                  943   $          1,153   2 %   (16) %
       Latin America                     195                        241                    353   (19) %   (45) %
       Middle East/North Africa/Asia                    524                        503                    542   4 %   (3) %
       Europe/Sub-Sahara Africa/Russia                    244                        199                    258   23 %   (5) %
    Total Revenue   $          1,204   $               1,193   $          1,405   1 %   (14) %


    North America

    Second quarter 2025 North America revenue of $241 million decreased by $9 million, or 4% sequentially, primarily from lower Wireline activity in Canada Land, partly offset by higher Cementation Products and Liner Hangers activity. Year-over-year, North America decreased by $11 million, or 4% , primarily from lower activity across all the segments, partly offset by higher activity in US Offshore.

    International

    Second quarter 2025 international revenue of $963 million increased by $20 million, or 2% sequentially and decreased by $190 million, or 16% year-over-year.

    Second quarter 2025 Latin America revenue of $195 million decreased by $46 million, or 19% sequentially, primarily from lower activity in Argentina pursuant to the sale of the Argentina Pressure Pumping business, partly offset by higher Sub-sea intervention activity. Year-over-year, Latin America revenue decreased by $158 million, or 45%, primarily from lower activity in Mexico and Argentina, partly offset by higher Sub-sea intervention activity.

    Second quarter 2025 Middle East/North Africa/Asia revenue of $524 million increased by $21 million, or 4% sequentially, primarily from higher Liner Hangers and Cementation Products activity partly offset by lower Drilling Services. Year-over-year, the Middle East/North Africa/Asia revenue decreased by $18 million, or 3%, primarily from lower activity in the DRE and PRI segments partly offset by higher Liner Hangers activity.

    Second quarter 2025 Europe/Sub-Sahara Africa/Russia revenue of $244 million increased by $45 million, or 23% sequentially, primarily from higher activity across all the segments. Year-over-year, Europe/Sub-Sahara Africa/Russia revenue decreased by $14 million, or 5%, primarily from lower activity across all the segments especially WCC, partly offset by higher Drilling Services and Pressure Pumping.

    About Weatherford
    Weatherford delivers innovative energy services that integrate proven technologies with advanced digitalization to create sustainable offerings for maximized value and return on investment. Our world-class experts partner with customers to optimize their resources and realize the full potential of their assets. Operators choose us for strategic solutions that add efficiency, flexibility, and responsibility to any energy operation. The Company conducts business in approximately 75 countries and has approximately 17,300 team members representing more than 110 nationalities and 310 operating locations. Visit weatherford.com for more information and connect with us on social media.

    Conference Call Details

    Weatherford will host a conference call on Wednesday, July 23, 2025, to discuss the Company’s results for the second quarter ended June 30, 2025. The conference call will begin at 8:30 a.m. Eastern Time (7:30 a.m. Central Time).

    Listeners are encouraged to download the accompanying presentation slides which will be available in the investor relations section of the Company’s website.

    Listeners can participate in the conference call via a live webcast at https://www.weatherford.com/investor-relations/investor-news-and-events/events/ or by dialing +1 877-328-5344 (within the U.S.) or +1 412-902-6762 (outside of the U.S.) and asking for the Weatherford conference call. Participants should log in or dial in approximately 10 minutes prior to the start of the call.

    A telephonic replay of the conference call will be available until August 6, 2025, at 5:00 p.m. Eastern Time. To access the replay, please dial +1 877-344-7529 (within the U.S.) or +1 412-317-0088 (outside of the U.S.) and reference conference number 1312926. A replay and transcript of the earnings call will also be available in the investor relations section of the Company’s website.

    Contacts
    For Investors:
    Luke Lemoine
    Senior Vice President, Corporate Development & Investor Relations
    +1 713-836-7777
    investor.relations@weatherford.com

    For Media:
    Kelley Hughes
    Senior Director, Communications & Employee Engagement
    media@weatherford.com

    Forward-Looking Statements

    This news release contains projections and forward-looking statements concerning, among other things, the Company’s adjusted EBITDA*, adjusted EBITDA margin*, adjusted free cash flow*, shareholder return program, forecasts or expectations regarding business outlook, prospects for its operations, capital expenditures, expectations regarding future financial results, and are also generally identified by the words “believe,” “project,” “expect,” “anticipate,” “estimate,” “outlook,” “budget,” “intend,” “strategy,” “plan,” “guidance,” “may,” “should,” “could,” “will,” “would,” “will be,” “will continue,” “will likely result,” and similar expressions, although not all forward-looking statements contain these identifying words. Such statements are based upon the current beliefs of Weatherford’s management and are subject to significant risks, assumptions, and uncertainties. Should one or more of these risks or uncertainties materialize, or underlying assumptions prove incorrect, actual results may vary materially from those indicated in our forward-looking statements. Readers are cautioned that forward-looking statements are only estimates and may differ materially from actual future events or results, based on factors including but not limited to: global political, economic and market conditions, political disturbances, war or other global conflicts, terrorist attacks, changes in global trade policies, tariffs and sanctions, weak local economic conditions and international currency fluctuations; general global economic repercussions related to U.S. and global inflationary pressures and potential recessionary concerns; various effects from conflicts in the Middle East and the Russia Ukraine conflicts, including, but not limited to, nationalization of assets, extended business interruptions, sanctions, treaties and regulations (including changes in the regulatory environment) imposed by various countries, associated operational and logistical challenges, and impacts to the overall global energy supply; cybersecurity issues; our ability to comply with, and respond to, climate change, environmental, social and governance and other sustainability initiatives and future legislative and regulatory measures both globally and in specific geographic regions; the potential for a resurgence of a pandemic in a given geographic area and related disruptions; the price and price volatility of, and demand for, oil and natural gas; the macroeconomic outlook for the oil and gas industry; our ability to generate cash flow from operations to fund our operations; our ability to effectively and timely adapt our technology portfolio, products and services to remain competitive, and to address and participate in changes to the market demands, including for the transition to alternate sources of energy such as geothermal, carbon capture and responsible abandonment, including our digitalization efforts, increases in the prices and lead times, and the lack of availability of our procured products and services, including due to macroeconomic and geopolitical conditions such as tariffs and changes in trade policies, our ability to timely collect from customers; our ability to effectively execute our capital allocation framework; our ability to return capital to shareholders, including those related to the timing and amounts (including any plans or commitments in respect thereof) of any dividends and share repurchases; and the realization of additional cost savings and operational efficiencies.

    These risks and uncertainties are more fully described in Weatherford’s reports and registration statements filed with the Securities and Exchange Commission, including the risk factors described in the Company’s Annual Report on Form 10-K and Quarterly Reports on Form 10-Q. Accordingly, you should not place undue reliance on any of the Company’s forward-looking statements. Any forward-looking statement speaks only as of the date on which such statement is made, and the Company undertakes no obligation to correct or update any forward-looking statement, whether as a result of new information, future events or otherwise, except as required by applicable law, and we caution you not to rely on them unduly.

    *Non-GAAP – refer to the section titled Non-GAAP Financial Measures Defined and GAAP to Non-GAAP Financial Measures Reconciled

    Weatherford International plc
    Selected Statements of Operations (Unaudited)
                         
        Three Months Ended   Six Months Ended
    ($ in Millions, Except Per Share Amounts)   June 30,
    2025    		   March 31,
    2025    		   June 30,
    2024    		   June 30,
    2025    		   June 30,
    2024
    Revenues:                    
    DRE Revenues   $              335     $                 350     $              427     $            685     $            849  
    WCC Revenues                    456                          441                      504                     897                    962  
    PRI Revenues                    327                          334                      369                     661                    717  
    All Other                       86                            68                      105                     154                    235  
    Total Revenues                 1,204                      1,193                   1,405                 2,397                 2,763  
                         
    Operating Income:                    
    DRE Segment Adjusted EBITDA[1]   $                69     $                    74     $              130     $            143     $            260  
    WCC Segment Adjusted EBITDA[1]                    118                          128                      145                     246                    265  
    PRI Segment Adjusted EBITDA[1]                       63                            62                        85                     125                    158  
    All Other[2]                       19                              4                        23                       23                       50  
    Corporate[2]                     (15 )                        (15 )                    (18 )                   (30 )                   (32 )
    Depreciation and Amortization                     (64 )                        (62 )                    (86 )                 (126 )                (171 )
    Share-based Compensation                       (9 )                          (7 )                    (12 )                   (16 )                   (25 )
    Gain on Sale of Business                       70                            —                        —                       70                       —  
    Restructuring Charges                     (11 )                        (29 )                       (5 )                   (40 )                     (8 )
    Other (Charges) Credits                       (3 )                        (13 )                        2                     (16 )                     —  
    Operating Income                    237                          142                      264                     379                    497  
                         
    Other Expense:                    
    Interest Expense, Net of Interest Income of $14, $11,
    $17, $25 and $31    		                     (21 )                        (26 )                    (24 )                   (47 )                   (53 )
    Loss on Blue Chip Swap Securities                       (1 )                          —                      (10 )                     (1 )                   (10 )
    Other Expense, Net                     (24 )                        (20 )                    (20 )                   (44 ) —                 (42 )
    Income Before Income Taxes                    191                            96                      210                     287                    392  
    Income Tax Provision                     (46 )                        (10 )                    (73 )                   (56 )                (132 )
    Net Income                    145                            86                      137                     231                    260  
    Net Income Attributable to Noncontrolling Interests                         9                            10                        12                       19                       23  
    Net Income Attributable to Weatherford   $              136     $                    76     $              125     $            212     $            237  
                         
    Basic Income Per Share   $             1.87     $                1.04     $             1.71     $           2.91     $           3.25  
    Basic Weighted Average Shares Outstanding                   72.2                         73.1                     73.2                    72.7                   73.1  
                         
    Diluted Income Per Share   $             1.87     $                1.03     $             1.66     $           2.90     $           3.16  
    Diluted Weighted Average Shares Outstanding                   72.4                         73.4                     75.3       72.9       75.0  
    [1] Segment adjusted EBITDA is our primary measure of segment profitability under U.S. GAAP ASC 280 “Segment Reporting” and represents segment earnings before interest, taxes, depreciation, amortization, share-based compensation, restructuring charges and other adjustments. Research and development expenses are included in segment adjusted EBITDA.
    [2] All Other includes results from non-core business activities (including integrated services and projects), and Corporate includes overhead support and centrally managed or shared facilities costs. All Other and Corporate do not individually meet the criteria for segment reporting.
    Weatherford International plc
    Selected Balance Sheet Data (Unaudited)
           
    ($ in Millions) June 30, 2025   December 31, 2024
    Assets:      
    Cash and Cash Equivalents $                              943   $                                 916
    Restricted Cash                                     60                                         59
    Accounts Receivable, Net                               1,177                                    1,261
    Inventories, Net                                  881                                       880
    Property, Plant and Equipment, Net                               1,136                                    1,061
    Intangibles, Net                                  305                                       325
           
    Liabilities:      
    Accounts Payable                                  685                                       792
    Accrued Salaries and Benefits                                  252                                       302
    Current Portion of Long-term Debt                                     26                                         17
    Long-term Debt                               1,565                                    1,617
           
    Shareholders’ Equity:      
    Total Shareholders’ Equity                               1,519                                    1,283
    Weatherford International plc
    Selected Cash Flows Information (Unaudited)
                         
        Three Months Ended   Six Months Ended
    ($ in Millions)   June 30,
    2025    		   March 31,
    2025    		   June 30,
    2024    		   June 30,
    2025    		   June 30,
    2024
    Cash Flows From Operating Activities:                    
    Net Income   $             145     $                    86     $             137     $             231     $             260  
    Adjustments to Reconcile Net Income to Net Cash
    Provided By Operating Activities:    		                    
    Depreciation and Amortization                      64                             62                        86                      126                      171  
    Foreign Exchange Losses                      17                             13                          8                        30                        23  
    Loss on Blue Chip Swap Securities                        1                             —                        10                          1                        10  
    Gain on Disposition of Assets                      (3 )                           (1 )                    (25 )                      (4 )                    (32 )
    Gain on Sale of Business                    (70 )                           —                        —                      (70 )                      —   
    Deferred Income Tax Provision (Benefit)                      (5 )                             7                        13                          2                        27  
    Share-Based Compensation                        9                               7                        12                        16                        25  
    Changes in Accounts Receivable, Inventory, Accounts
    Payable and Accrued Salaries and Benefits    		                    (22 )                         (17 )                    (22 )                    (39 )                  (174 )
    Other Changes, Net                      (8 )                         (15 )                    (69 )                    (23 )                    (29 )
    Net Cash Provided By Operating Activities                    128                          142                      150                      270                      281  
                         
    Cash Flows From Investing Activities:                    
    Capital Expenditures for Property, Plant and Equipment                    (54 )                         (77 )                    (62 )                  (131 )                  (121 )
    Proceeds from Disposition of Assets                        5                               1                          8                          6                        18  
    Proceeds from Sale of Businesses                      97                             —                        —                        97                        —   
    Purchases of Blue Chip Swap Securities                    (83 )                           —                      (50 )                    (83 )                    (50 )
    Proceeds from Sales of Blue Chip Swap Securities                      82                             —                        40                        82                        40  
    Business Acquisitions, Net of Cash Acquired                      —                             —                        —                        —                       (36 )
    Proceeds from Sale of Investments                      —                             —                        —                        —                         41  
    Other Investing Activities                      (4 )                           (3 )                        3                        (7 )                      (7 )
    Net Cash Provided by (Used In) Investing Activities                      43                           (79 )                    (61 )                    (36 )                  (115 )
                         
    Cash Flows From Financing Activities:                    
    Repayments of Long-term Debt                    (34 )                         (39 )                    (87 )                    (73 )                  (259 )
       Distributions to Noncontrolling Interests                      (8 )                           —                        (9 )                      (8 )                      (9 )
    Tax Remittance on Equity Awards                      —                           (20 )                      (1 )                    (20 )                      (9 )
    Share Repurchases                    (34 )                         (53 )                      —                      (87 )                      —   
    Dividends Paid                    (18 )                         (18 )                      —                      (36 )                      —   
    Other Financing Activities                      (3 )                           (3 )                      (5 )                      (6 )                    (12 )
    Net Cash Used In Financing Activities   $              (97 )   $                (133 )   $           (102 )   $           (230 )   $           (289 )
    Weatherford International plc
    Non-GAAP Financial Measures Defined (Unaudited)

    We report our financial results in accordance with U.S. generally accepted accounting principles (GAAP). However, Weatherford’s management believes that certain non-GAAP financial measures (as defined under the SEC’s Regulation G and Item 10(e) of Regulation S-K) may provide users of this financial information additional meaningful comparisons between current results and results of prior periods and comparisons with peer companies. The non-GAAP amounts shown in the following tables should not be considered as substitutes for results reported in accordance with GAAP but should be viewed in addition to the Company’s reported results prepared in accordance with GAAP.

    Adjusted EBITDA* – Adjusted EBITDA* is a non-GAAP measure and represents consolidated income before interest expense, net, income taxes, depreciation and amortization expense, and excludes, among other items, restructuring charges, share-based compensation expense, as well as other charges and credits. Management believes adjusted EBITDA* is useful to assess and understand normalized operating performance and trends. Adjusted EBITDA* should be considered in addition to, but not as a substitute for consolidated net income and should be viewed in addition to the Company’s reported results prepared in accordance with GAAP.

    Adjusted EBITDA margin* – Adjusted EBITDA margin* is a non-GAAP measure which is calculated by dividing consolidated adjusted EBITDA* by consolidated revenues. Management believes adjusted EBITDA margin* is useful to assess and understand normalized operating performance and trends. Adjusted EBITDA margin* should be considered in addition to, but not as a substitute for consolidated net income margin and should be viewed in addition to the Company’s reported results prepared in accordance with GAAP.

    Adjusted Free Cash Flow* – Adjusted Free Cash Flow* is a non-GAAP measure and represents cash flows provided by (used in) operating activities, less capital expenditures plus proceeds from the disposition of assets. Management believes adjusted free cash flow* is useful to understand our performance at generating cash and demonstrates our discipline around the use of cash. Adjusted free cash flow* should be considered in addition to, but not as a substitute for cash flows provided by operating activities and should be viewed in addition to the Company’s reported results prepared in accordance with GAAP.

    Net Debt* – Net Debt* is a non-GAAP measure that is calculated taking short and long-term debt less cash and cash equivalents and restricted cash. Management believes the net debt* is useful to assess the level of debt in excess of cash and cash and equivalents as we monitor our ability to repay and service our debt. Net debt* should be considered in addition to, but not as a substitute for overall debt and total cash and should be viewed in addition to the Company’s results prepared in accordance with GAAP.​

    Net Leverage* – Net Leverage* is a non-GAAP measure which is calculated by dividing by taking net debt* divided by adjusted EBITDA* for the trailing 12 months. Management believes the net leverage* is useful to understand our ability to repay and service our debt. Net leverage* should be considered in addition to, but not as a substitute for the individual components of above defined net debt* divided by consolidated net income attributable to Weatherford and should be viewed in addition to the Company’s reported results prepared in accordance with GAAP.

    *Non-GAAP – as defined above and reconciled to the GAAP measures in the section titled GAAP to Non-GAAP Financial Measures Reconciled

    Weatherford International plc
    GAAP to Non-GAAP Financial Measures Reconciled (Unaudited)
     
                         
        Three Months Ended   Six Months Ended
    ($ in Millions, Except Margin in Percentages)   June 30,
    2025    		   March 31,
    2025    		   June 30,
    2024    		   June 30,
    2025    		   June 30,
    2024
    Revenues   $         1,204     $          1,193     $         1,405     $      2,397     $      2,763  
    Net Income Attributable to Weatherford   $            136     $                76     $            125     $         212     $         237  
    Net Income Margin     11.3 %     6.4 %     8.9 %     8.8 %     8.6 %
    Adjusted EBITDA*   $            254     $              253     $            365     $         507     $         701  
    Adjusted EBITDA Margin*     21.1 %     21.2 %     26.0 %     21.2 %     25.4 %
                         
    Net Income Attributable to Weatherford   $            136     $                76     $            125     $         212     $         237  
    Net Income Attributable to Noncontrolling Interests                       9                        10                       12                    19                    23  
    Income Tax Provision                     46                        10                       73                    56                 132  
    Interest Expense, Net of Interest Income of $14, $11,
    $17, $25 and $31    		                     21                        26                       24                    47                    53  
    Loss on Blue Chip Swap Securities                       1                        —                       10                      1                    10  
    Other Expense, Net                     24                        20                       20                    44                    42  
    Operating Income                  237                      142                    264                 379                 497  
    Depreciation and Amortization                     64                        62                       86                 126                 171  
    Other Charges (Credits)[1]                       3                        13                       (2 )                  16                    —  
    Gain on Sale of Business                   (70 )                      —                       —                  (70 )                  —  
    Restructuring Charges                     11                        29                         5                    40                      8  
    Share-Based Compensation                       9                          7                       12                    16                    25  
    Adjusted EBITDA*   $            254     $              253     $            365     $         507     $         701  
                         
    Net Cash Provided By Operating Activities   $            128     $              142     $            150     $         270     $         281  
    Capital Expenditures for Property, Plant and
    Equipment    		                   (54 )                    (77 )                   (62 )             (131 )             (121 )
    Proceeds from Disposition of Assets                       5                          1                         8                      6                    18  
    Adjusted Free Cash Flow*   $              79     $                66     $              96     $         145     $         178  
    [1] Other Charges (Credits) in the three and six months ended June 30, 2025 primarily includes fees to third-party financial institutions related to collections of certain receivables from our largest customer in Mexico and other miscellaneous charges and credits.

    *Non-GAAP – as reconciled to the GAAP measures above and defined in the section titled Non-GAAP Financial Measures Defined

    Weatherford International plc
    GAAP to Non-GAAP Financial Measures Reconciled Continued (Unaudited)
     
                   
         
    ($ in Millions)   June 30,
    2025    		   March 31,
    2025    		   June 30,
    2024    		  
    Current Portion of Long-term Debt   $                   26   $                    22   $                   20  
    Long-term Debt                    1,565                    1,583                    1,628  
    Total Debt   $              1,591   $              1,605   $              1,648  
                   
    Cash and Cash Equivalents   $                 943   $                 873   $                 862  
    Restricted Cash                          60                          57                          58  
    Total Cash   $              1,003   $                 930   $                 920  
                   
    Components of Net Debt              
    Current Portion of Long-term Debt   $                   26   $                    22   $                   20  
    Long-term Debt                    1,565                    1,583                    1,628  
    Less: Cash and Cash Equivalents                       943                        873                       862  
    Less: Restricted Cash                          60                          57                          58  
    Net Debt*   $                 588   $                 675   $                 728  
                   
    Net Income for trailing 12 months   $                 481   $                 470   $                 500  
    Adjusted EBITDA* for trailing 12 months   $              1,188   $              1,299   $              1,327  
                   
    Net Leverage* (Net Debt*/Adjusted EBITDA*)                      0.49 x                     0.52 x                    0.55 x


    *Non-GAAP – as reconciled to the GAAP measures above and defined in the section titled Non-GAAP Financial Measures Defined

    The MIL Network –

  • MIL-OSI: FS Bancorp, Inc. Reports Second Quarter Net Income of $7.7 Million or $0.99 Per Diluted Share and Declares 50th Consecutive Quarterly Cash Dividend in Addition to a Special Dividend 

    Source: GlobeNewswire (MIL-OSI)

    MOUNTLAKE TERRACE, Wash., July 22, 2025 (GLOBE NEWSWIRE) — FS Bancorp, Inc. (NASDAQ: FSBW) (the “Company”), the holding company for 1st Security Bank of Washington (the “Bank”) today reported 2025 second quarter net income of $7.7 million, or $0.99 per diluted share, compared to $9.0 million, or $1.13 per diluted share, for the comparable quarter one year ago. For the six months ended June 30, 2025, net income was $15.7 million, or $1.99 per diluted share, compared to net income of $17.4 million, or $2.20 per diluted share, for the comparable six-month period in 2024.

    “We are proud of the balance sheet growth this quarter driven by solid loan demand. Additionally, our share repurchase activity reflects our continued confidence and commitment to delivering long-term value to our shareholders,” stated Phillip Whittington, CFO.

    “We are pleased to announce that our Board of Directors has approved our 50th consecutive quarterly cash dividend of $0.28 per common share, demonstrating our continued commitment to delivering value to our shareholders. In recognition of this milestone, the Board also approved a special dividend of $0.22 per common share. Both dividends will be paid on August 21, 2025, to shareholders of record as of August 7, 2025,” noted Matthew Mullet, President.

    2025 Second Quarter Highlights

    • Net income was $7.7 million for the second quarter of 2025, compared to $8.0 million for the previous quarter, and $9.0 million for the comparable quarter one year ago;
    • Total deposits decreased $61.8 million, or 2.4%, to $2.55 billion at June 30, 2025, primarily due to a decrease of $59.1 million in brokered deposits, compared to $2.62 billion at March 31, 2025, and increased $170.6 million, or 7.2%, from $2.38 billion at June 30, 2024.  Noninterest-bearing deposits were $654.1 million at June 30, 2025, $676.7 million at March 31, 2025, and $623.3 million at June 30, 2024;
    • Borrowings increased $165.5 million, or 240.5% to $234.3 million at June 30, 2025, compared to $68.8 million at March 31, 2025, and increased $52.4 million, or 28.8%, from $181.9 million at June 30, 2024;
    • Loans receivable, net increased $81.2 million, or 3.2%, to $2.58 billion at June 30, 2025, compared to $2.50 billion at March 31, 2025, and increased $125.1 million, or 5.1%, from $2.46 billion at June 30, 2024;
    • Consumer loans were $606.3 million at June 30, 2025, a decrease of $2.6 million, or 0.4%, from $608.9 million in the previous quarter, and a decrease of $35.4 million, or 5.5%, from $641.7 million in the comparable quarter one year ago. During the three months ended June 30, 2025, consumer loan originations included 82.5% of home improvement loans originated with a Fair Isaac Corporation (“FICO”) score above 720;
    • Repurchased 132,282 shares of the Company’s common stock in the second quarter of 2025 at an average price of $38.92 per share with $725,000 remaining for future purchases under the existing share repurchase plan at June 30, 2025. In addition, as previously announced on July 9, 2025, the Board approved a new share repurchase plan authorizing the repurchase of up to $5.0 million in shares of the Company’s outstanding common stock;
    • Book value per share increased $0.43 to $39.55 at June 30, 2025, compared to $39.12 at March 31, 2025, and increased $2.40 from $37.15 at June 30, 2024.  Tangible book value per share (non-GAAP financial measure) increased $0.50 to $37.46 at June 30, 2025, compared to $36.96 at March 31, 2025, and increased $2.80 from $34.66 at June 30, 2024. See, “Non-GAAP Financial Measures;”
    • Segment reporting in the second quarter of 2025 reflected net income of $7.4 million for the Commercial and Consumer Banking segment and $351,000 for the Home Lending segment, compared to net income of $7.8 million and $242,000 in the prior quarter, and net income of $8.0 million and $1.0 million in the second quarter of 2024, respectively; and
    • Regulatory capital ratios at the Bank were 14.1% for total risk-based capital and 11.2% for Tier 1 leverage capital at June 30, 2025, compared to 14.4% for total risk-based capital and 11.3% for Tier 1 leverage capital at March 31, 2025.

    Segment Reporting

    The Company operates through two reportable segments: Commercial and Consumer Banking and Home Lending. The Commercial and Consumer Banking segment provides diversified financial products and services to our commercial and consumer customers. These products and services include deposit products; residential, consumer, business and commercial real estate lending and cash management services. This segment also manages the Bank’s investment portfolio and other assets. The Home Lending segment originates one-to-four-family residential mortgage loans primarily for sale in the secondary markets as well as loans held for investment.

    The tables below provide a summary of segment reporting at or for the three and six months ended June 30, 2025 and 2024 (dollars in thousands):

        At or For the Three Months Ended June 30, 2025  
    Condensed income statement:   Commercial and Consumer Banking     Home Lending     Total  
    Net interest income(1)   $ 29,179     $ 2,933     $ 32,112  
    Provision for credit losses     (1,849 )     (172 )     (2,021 )
    Noninterest income(2)     2,297       2,873       5,170  
    Noninterest expense(3)     (20,313 )     (5,189 )     (25,502 )
    Income before provision for income taxes     9,314       445       9,759  
    Provision for income taxes     (1,937 )     (94 )     (2,031 )
    Net income   $ 7,377     $ 351     $ 7,728  
    Total average assets for period ended   $ 2,466,917     $ 649,443     $ 3,116,360  
    Full-time employees (“FTEs”)     452       115       567  
        At or Three Months Ended June 30, 2024
    Condensed income statement:   Commercial and Consumer Banking   Home Lending   Total
    Net interest income(1)   $ 28,051     $ 2,350     $ 30,401  
    (Provision) recovery for credit losses     (1,214 )     137       (1,077 )
    Noninterest income(2)     2,269       3,599       5,868  
    Noninterest expense(3)     (19,043 )     (4,814 )     (23,857 )
    Income before provision for income taxes     10,063       1,272       11,335  
    Provision for income taxes     (2,113 )     (263 )     (2,376 )
    Net income   $ 7,950     $ 1,009     $ 8,959  
    Total average assets for period ended   $ 2,359,741     $ 588,090     $ 2,947,831  
    FTEs     450       121       571  
        At or For the Six Months Ended June 30, 2025  
    Condensed income statement:   Commercial and Consumer Banking     Home Lending     Total  
    Net interest income(1)   $ 57,586     $ 5,507     $ 63,093  
    Provision for credit losses     (3,170 )     (443 )     (3,613 )
    Noninterest income(2)     4,542       5,754       10,296  
    Noninterest expense(3)     (40,489 )     (10,067 )     (50,556 )
    Income before provision for income taxes     18,469       751       19,220  
    Provision for income taxes     (3,314 )     (157 )     (3,471 )
    Net income   $ 15,155     $ 594     $ 15,749  
    Total average assets for period ended   $ 2,440,654     $ 634,013     $ 3,074,667  
    FTEs     452       115       567  
        At or For the Six Months Ended June 30, 2024  
    Condensed income statement:   Commercial and Consumer Banking     Home Lending     Total  
    Net interest income(1)   $ 56,137     $ 4,610     $ 60,747  
    Provision for credit losses     (2,465 )     (11 )     (2,476 )
    Noninterest income(2)     4,662       6,317       10,979  
    Noninterest expense(3)     (38,051 )     (9,335 )     (47,386 )
    Income before provision for income taxes     20,283       1,581       21,864  
    Provision for income taxes     (4,182 )     (326 )     (4,508 )
    Net income   $ 16,101     $ 1,255     $ 17,356  
    Total average assets for period ended   $ 2,380,803     $ 572,386     $ 2,953,189  
    FTEs     450       121       571  

    __________________________

    (1)   Net interest income is the difference between interest earned on assets and the cost of liabilities to fund those assets. Interest earned includes actual interest earned on segment assets and, if the segment has excess liabilities, interest credits for providing funding to the other segment. The cost of liabilities includes interest expense on segment liabilities and, if the segment does not have enough liabilities to fund its assets, a funding charge based on the cost of assigned liabilities to fund segment assets.
    (2)   Noninterest income includes activity from certain residential mortgage loans that were initially originated for sale and measured at fair value and subsequently transferred to loans held for investment. Gains and losses from changes in fair value for these loans are reported in earnings as a component of noninterest income. For the three and six months ended June 30, 2025, the Company recorded a net increase in fair value of $3,000 and $266,000, respectively, compared to a net increase in fair value of $184,000 and $186,000, respectively for the three and six months ended June 30, 2024. As of June 30, 2025 and 2024, there were $13.2 million and $13.9 million, respectively, in residential mortgage loans recorded at fair value as they were previously transferred from loans held for sale to loans held for investment.
    (3)   Noninterest expense includes allocated overhead expense from general corporate activities. Allocation is determined based on a combination of segment assets and FTEs.  For the three and six months ended June 30, 2025 and 2024, the Home Lending segment included allocated overhead expenses of $1.8 million and $3.7 million, compared to $1.5 million and $3.0 million, respectively.
         

    Asset Summary

    The following table presents the components and changes in total assets as of the dates indicated.

    ASSETS                           Linked Quarter     Prior Year  
    (Dollars in thousands)   June 30,     March 31,     June 30,     Change     Quarter Change  
        2025     2025     2024     $     %     $     %  
    Cash and due from banks   $ 15,168     $ 18,657     $ 20,005     $ (3,489 )     (19 )%   $ (4,837 )     (24 )%
    Interest-bearing deposits at other financial institutions     18,027       44,084       13,006       (26,057 )     (59 )     5,021       39  
    Total cash and cash equivalents     33,195       62,741       33,011       (29,546 )     (47 )     184       1  
    Certificates of deposit at other financial institutions     248       1,234       12,707       (986 )     (80 )     (12,459 )     (98 )
    Securities available-for-sale, at fair value     302,692       291,133       221,182       11,559       4       81,510       37  
    Securities held-to-maturity, net     31,562       10,434       8,455       21,128       202       23,107       273  
    Loans held for sale, at fair value     53,630       31,038       53,811       22,592       73       (181 )     —  
    Loans receivable, net     2,582,272       2,501,117       2,457,184       81,155       3       125,088       5  
    Accrued interest receivable     14,270       14,406       13,792       (136 )     (1 )     478       3  
    Premises and equipment, net     30,098       29,451       29,999       647       2       99       —  
    Operating lease right-of-use     7,969       4,979       5,784       2,990       60       2,185       38  
    Federal Home Loan Bank stock, at cost     11,579       5,256       10,322       6,323       120       1,257       12  
    Deferred tax asset, net     7,782       7,009       4,590       773       11       3,192       70  
    Bank owned life insurance (“BOLI”), net     38,262       38,778       38,201       (516 )     (1 )     61       —  
    MSRs, held at the lower of cost or fair value     8,652       8,926       9,352       (274 )     (3 )     (700 )     (7 )
    Goodwill     3,592       3,592       3,592       —       —       —       —  
    Core deposit intangible, net     12,071       12,879       15,483       (808 )     (6 )     (3,412 )     (22 )
    Other assets     38,139       43,105       23,912       (4,966 )     (12 )     14,227       59  
    TOTAL ASSETS   $ 3,176,013     $ 3,066,078     $ 2,941,377     $ 109,935       4 %   $ 234,636       8 %
                                                             

    The increase in total assets reflects the Company’s continued focus on balance sheet growth through loan origination and selective investment activity, funded by a combination of on-balance sheet liquidity and borrowings.

                                                                Prior  
    LOAN PORTFOLIO                                                   Linked     Year  
    (Dollars in thousands)                                                   Quarter     Quarter  
    COMMERCIAL REAL ESTATE   June 30, 2025     March 31, 2025     June 30, 2024     $     $  
    (“CRE”) LOANS   Amount     Percent     Amount     Percent     Amount     Percent     Change     Change  
    CRE owner occupied   $ 180,250       6.8 %   $ 164,911       6.5 %   $ 177,723       7.1 %   $ 15,339     $ 2,527  
    CRE non-owner occupied     171,979       6.6       174,188       6.9       181,681       7.3       (2,209 )     (9,702 )
    Commercial and speculative construction and development     300,723       11.5       288,978       11.4       220,793       8.9       11,745       79,930  
    Multi-family     263,185       10.1       244,940       9.7       239,675       9.6       18,245       23,510  
    Total CRE loans     916,137       35.0       873,017       34.5       819,872       32.9       43,120       96,265  
                                                                     
    RESIDENTIAL REAL ESTATE LOANS                                                                
    One-to-four-family (excludes HFS)     639,881       24.4       637,299       25.2       588,966       23.7       2,582       50,915  
    Home equity     85,613       3.3       73,846       2.9       73,749       3.0       11,767       11,864  
    Residential custom construction     54,024       2.1       48,810       1.9       53,416       2.1       5,214       608  
    Total residential real estate loans     779,518       29.8       759,955       30.0       716,131       28.8       19,563       63,387  
                                                                     
    CONSUMER LOANS                                                                
    Indirect home improvement     530,375       20.3       532,038       21.0       563,621       22.6       (1,663 )     (33,246 )
    Marine     72,765       2.8       73,737       2.9       74,627       3.0       (972 )     (1,862 )
    Other consumer     3,151       0.1       3,118       0.1       3,440       0.1       33       (289 )
    Total consumer loans     606,291       23.2       608,893       24.0       641,688       25.7       (2,602 )     (35,397 )
                                                                     
    COMMERCIAL BUSINESS LOANS                                                                
    Commercial and industrial (“C&I”)     294,563       11.3       274,956       10.9       285,183       11.6       19,607       9,380  
    Warehouse lending     17,952       0.7       15,949       0.6       25,548       1.0       2,003       (7,596 )
    Total commercial business loans     312,515       12.0       290,905       11.5       310,731       12.6       21,610       1,784  
    Total loans receivable, gross     2,614,461       100.0 %     2,532,770       100.0 %     2,488,422       100.0 %     81,691       126,039  
                                                                     
    Allowance for credit losses on loans     (32,189 )             (31,653 )             (31,238 )             (536 )     (951 )
    Total loans receivable, net   $ 2,582,272             $ 2,501,117             $ 2,457,184             $ 81,155     $ 125,088  
                                                                     

    The composition of CRE loans at the dates indicated were as follows:

    (Dollars in thousands)   June 30, 2025     March 31, 2025     June 30, 2024  
    CRE by Type:   Amount     Amount     Amount  
    CRE non-owner occupied:                        
    Office   $ 39,141     $ 39,406     $ 41,380  
    Retail     38,652       35,520       37,507  
    Hospitality/restaurant     26,489       27,377       28,314  
    Self-storage     19,075       19,092       19,141  
    Mixed use     18,387       18,868       18,062  
    Industrial     14,444       15,033       17,163  
    Senior housing/assisted living     7,448       7,506       7,675  
    Other     3,670       6,579       6,847  
    Land     2,206       2,314       3,021  
    Education/worship     2,467       2,493       2,571  
    Total CRE non-owner occupied     171,979       174,188       181,681  
    CRE owner occupied:                        
    Industrial     77,419       66,618       63,970  
    Office     40,156       40,447       41,978  
    Retail     19,470       20,535       20,885  
    Other     9,483       8,529       8,354  
    Hospitality/restaurant     7,230       7,306       10,800  
    Automobile related     7,215       7,266       8,200  
    Mixed use     5,548       5,579       5,680  
    Agriculture     4,652       3,990       3,639  
    Education/worship     4,630       4,641       4,610  
    Car wash     4,447       —       9,607  
    Total CRE owner occupied     180,250       164,911       177,723  
    Total   $ 352,229     $ 339,099     $ 359,404  
                             

    The following table includes CRE loans repricing or maturing within the next two years, excluding loans that reprice simultaneously with changes to the prime rate:

                                                              Current
    (Dollars in                                                         Weighted
    thousands)   For the Quarter Ended       Average
    CRE by type:   Sep 30, 2025   Dec 31, 2025   Mar 31, 2026   Jun 30, 2026   Sep 30, 2026   Dec 31, 2026   Mar 31, 2027   Jun 30, 2027   Total   Rate
    Agriculture   $ 716   $ 314   $ 178   $ 265   $ 287   $ —   $ —   $ —   $ 1,760   6.28 %
    Apartment     —     13,679     1,128     13,788     9,747     7,062     4,117     —     49,521   4.96 %
    Hotel / hospitality     2,393     —     113     1,243     —     —     103     —     3,852   5.26 %
    Industrial     —     10,002     976     586     1,578     —     13,412     263     26,817   5.12 %
    Mixed use     241     —     7,101     —     —     379     —     —     7,721   8.14 %
    Office     15,015     6,055     515     1,629     554     7,695     2,857     1,213     35,533   5.50 %
    Other     1,921     240     884     —     —     1,485     —     3,515     8,045   4.80 %
    Retail     1,020     —     421     3,448     —     3,399     3,027     2,801     14,116   4.26 %
    Education/worship     1,314     —     —     —     2,467     —     —     —     3,781   5.18 %
    Senior housing and assisted living     —     —     2,142     —     —     —     —     1,372     3,514   4.76 %
    Total   $ 22,620   $ 30,290   $ 13,458   $ 20,959   $ 14,633   $ 20,020   $ 23,516   $ 9,164   $ 154,660   5.22 %
                                                                 

    The composition of construction loans at the dates indicated were as follows:

    (Dollars in thousands)   June 30, 2025     March 31, 2025     June 30, 2024  
    Construction Types:   Amount     Percent     Amount     Percent     Amount     Percent  
    Commercial construction – retail   $ 8,447       2.4 %   $ 8,157       2.4 %   $ 8,698       3.2 %
    Commercial construction – office     9,083       2.6       6,487       1.9       4,737       1.7  
    Commercial construction – self storage     16,553       4.7       16,012       4.7       10,000       3.6  
    Commercial construction – hotel     3,673       1.0       402       0.1       7,807       2.8  
    Multi-family     23,119       6.5       31,275       9.3       30,960       11.3  
    Custom construction – single family residential and single family manufactured residential     45,570       12.8       41,143       12.2       46,106       16.8  
    Custom construction – land, lot and acquisition and development     8,454       2.4       7,667       2.3       7,310       2.7  
    Speculative residential construction – vertical     200,375       56.5       186,042       55.1       131,294       47.9  
    Speculative residential construction – land, lot and acquisition and development     39,473       11.1       40,603       12.0       27,297       10.0  
    Total   $ 354,747       100.0 %   $ 337,788       100.0 %   $ 274,209       100.0 %
                                                     

    Originations of one-to-four-family loans to purchase and refinance a home for the periods indicated were as follows:

    (Dollars in                                                 Prior Year  
    thousands)   For the Three Months Ended     Linked Quarter   Quarter  
        June 30, 2025     March 31, 2025     June 30, 2024     $   %   $     %  
        Amount   Percent     Amount   Percent     Amount   Percent     Change   Change   Change     Change  
    Purchase   $ 170,854   85.7 %   $ 120,719   83.0 %   $ 193,715   92.3 %   $ 50,135   41.5   $ (22,861 )   (11.8 )%
    Refinance     28,470   14.3       24,677   17.0       16,173   7.7       3,793   15.4     12,297     76.0 %
    Total   $ 199,324   100.0 %   $ 145,396   100.0 %   $ 209,888   100.0 %   $ 53,928   37.1   $ (10,564 )   (5.0 )%
    (Dollars in thousands)   For the Six Months Ended June 30,            
        2025     2024            
        Amount   Percent     Amount   Percent     $ Change   % Change  
    Purchase   $ 290,737   84.3 %   $ 329,292   90.5 %   $ (38,555 )   (11.7 ) %
    Refinance     53,983   15.7       34,545   9.5       19,438     56.3   %
    Total   $ 344,720   100.0 %   $ 363,837   100.0 %   $ (19,117 )   (5.3 ) %
                                             

    During the quarter ended June 30, 2025, the Company sold $127.1 million of one-to-four-family loans compared to $91.9 million during the previous quarter and $164.5 million during the same quarter one year ago. The increase in the volume of loans sold during the current quarter compared to the prior quarter was primarily due to seasonal factors, including the spring homebuying season. This increased demand for homes generally results in a higher volume of loan originations and, consequently, more loans available for sale. Gross margins on home loan sales decreased to 3.06% for the quarter ended June 30, 2025, compared to 3.26% in the previous quarter and increased from 2.96% in the same quarter one year ago. Gross margins are defined as the margin on loans sold (cash sales) without the impact of deferred costs.

    Liabilities and Equity Summary

    The following table summarizes the components and changes in deposits, borrowings, equity, and book value per common share at the dates indicated.

    (Dollars in thousands)                                                   Linked     Prior Year  
    Deposits   June 30, 2025     March 31, 2025     June 30, 2024     Quarter     Quarter  
    Transactional deposits:   Amount     Percent     Amount     Percent     Amount     Percent     $ Change     $ Change  
    Noninterest-bearing checking   $ 643,573       25.2 %   $ 659,417       25.2 %   $ 613,137       25.7 %   $ (15,844 )   $ 30,436  
    Interest-bearing checking:                                                                
    Retail deposits     181,240       7.1       171,396       6.6       166,839       7.0       9,844       14,401  
    Brokered deposits     30,020       1.2       30,073       1.1       —       —       (53 )     30,020  
    Total interest-bearing checking     211,260       8.3       201,469       7.7       166,839       7.0       9,791       44,421  
    Escrow accounts related to mortgages serviced(1)     10,496       0.4       17,289       0.7       10,212       0.4       (6,793 )     284  
    Subtotal     865,329       33.9       878,175       33.6       790,188       33.1       (12,846 )     75,141  
    Savings and money market:                                                                
    Savings     159,601       6.3       160,332       6.1       151,398       6.4       (731 )     8,203  
    Money market:                                                                
    Retail deposits     350,548       13.6       343,098       13.1       339,946       14.2       7,450       10,602  
    Brokered deposits     251       0.1       251       —       4,049       0.2       —       (3,798 )
    Total money market     350,799       13.7       343,349       13.1       343,995       14.4       7,450       6,804  
    Subtotal     510,400       20.0       503,681       19.2       495,393       20.8       6,719       15,007  
    Certificates of deposit:                                                                
    Retail CDs     891,355       34.9       881,630       33.7       823,866       34.6       9,725       67,489  
    Nonretail CDs:                                                                
    Online CDs     3,423       0.1       9,354       0.4       9,354       0.4       (5,931 )     (5,931 )
    Public CDs     2,114       0.1       2,440       0.1       2,983       0.1       (326 )     (869 )
    Brokered CDs     280,754       11.0       339,871       13.0       261,019       11.0       (59,117 )     19,735  
    Total nonretail CDs     286,291       11.2       351,665       13.5       273,356       11.5       (65,374 )     12,935  
    Subtotal     1,177,646       46.1       1,233,295       47.2       1,097,222       46.1       (55,649 )     80,424  
    Total deposits   $ 2,553,375       100.0 %   $ 2,615,151       100.0 %   $ 2,382,803       100.0 %   $ (61,776 )   $ 170,572  
    Borrowings(2)   $ 234,305             $ 68,805             $ 181,895             $ 165,500     $ 52,410  
    Equity   $ 297,203             $ 298,840             $ 284,026             $ (1,637 )   $ 13,177  
    Book value per common share   $ 39.55             $ 39.12             $ 37.15             $ 0.43     $ 2.40  

    __________________________

    (1)   Primarily noninterest-bearing accounts based on applicable state law.
    (2)   Comprised of FHLB advances and Federal Reserve Bank borrowings.
         

    At June 30, 2025, the Bank had uninsured deposits of approximately $677.2 million, compared to approximately $679.4 million at March 31, 2025, and $586.6 million at June 30, 2024.  The uninsured amounts are estimates based on the methodologies and assumptions used for the Bank’s regulatory reporting requirements.

    In reference to the table above, the linked quarter decrease in stockholders’ equity at June 30, 2025, compared to March 31, 2025, was primarily due to share repurchases of $5.1 million, cash dividends paid of $2.1 million, and $525,000 in equity award compensation, partially offset by net income of $7.7 million. Stockholders’ equity was also impacted by a decline in unrealized fair value on securities available for sale of $1.2 million, net of tax, and fair value and cash flow hedges of $1.6 million, net of tax, reflecting changes in market interest rates during the quarter, resulting in a $2.8 million decrease in accumulated other comprehensive loss, net of tax.

    The Bank is considered “well capitalized” under the capital requirement established by the Federal Deposit Insurance Corporation (“FDIC”) and the Company exceeded all regulatory capital requirements. At June 30, 2025, capital ratios presented for the Bank and the Company were as follows:

        At June 30, 2025
        Bank   Company
    Total risk-based capital (to risk-weighted assets)   14.07 %   14.16 %
    Tier 1 leverage capital (to average assets)   11.18 %   9.65 %
    CET 1 capital (to risk-weighted assets)   12.82 %   11.07 %
                 

    Credit Quality

    The following table summarizes the changes in the ACL on loans, nonperforming loans, and substandard loans at the dates indicated.

    ACL ON LOANS   June 30,     March 31,     June 30,     Linked     Prior Year  
    (Dollars in thousands)   2025     2025     2024     Quarter     Quarter  
        Amount     Amount     Amount     $ Change     $ Change  
    Beginning ACL balance   $ (31,653 )   $ (31,870 )   $ (31,479 )   $ 217     $ (174 )
    Provision     (1,715 )     (1,505 )     (1,001 )     (210 )     (714 )
    Charge-offs                                        
    Indirect     1,555       1,579       825       (24 )     730  
    Marine     43       20       157       23       (114 )
    Other     42       37       33       5       9  
    Commercial business     —       433       733       (433 )     (733 )
    Subtotal     1,640       2,069       1,748       (429 )     (108 )
    Recoveries                                        
    Indirect     (330 )     (340 )     (307 )     10       (23 )
    Marine     (54 )     (3 )     (110 )     (51 )     56  
    Other     (7 )     (4 )     (4 )     (3 )     (3 )
    Commercial business     (70 )     —       (85 )     (70 )     15  
    Subtotal     (461 )     (347 )     (506 )     (114 )     45  
    Ending ACL balance   $ (32,189 )   $ (31,653 )   $ (31,238 )   $ (536 )   $ (951 )
    NONPERFORMING LOANS   June 30,   March 31,   June 30,   Linked   Prior Year
    (Dollars in thousands)   2025   2025   2024   Quarter   Quarter
    CRE LOANS   Amount   Amount   Amount   $ Change   $ Change
    CRE   $ 2,046   $ 1,196   $ 1,116   $ 850     $ 930  
    Commercial and speculative construction and development     9,083     6,487     4,737     2,596       4,346  
    Total CRE loans     11,129     7,683     5,853     3,446       5,276  
                                   
    RESIDENTIAL REAL ESTATE LOANS                              
    One-to-four-family (excludes HFS)     1,809     1,134     170     675       1,639  
    Home equity     251     252     156     (1 )     95  
    Total residential real estate loans     2,060     1,386     326     674       1,734  
                                   
    CONSUMER LOANS                              
    Indirect home improvement     3,365     2,821     2,319     544       1,046  
    Marine     567     648     327     (81 )     240  
    Other consumer     13     1     6     12       7  
    Total consumer loans     3,945     3,470     2,652     475       1,293  
                                   
    COMMERCIAL BUSINESS LOANS                              
    C&I     1,862     1,932     2,575     (70 )     (713 )
    Total nonperforming loans   $ 18,996   $ 14,471   $ 11,406   $ 4,525     $ 7,590  
                                       

    The increase in nonaccrual loans during the period was partly driven by a single commercial construction loan, which remains in active development. Ongoing construction disbursements on this loan contributed to a $2.6 million increase from the prior quarter and a $4.3 million increase compared to the same period last year. Increases in consumer loan delinquencies also contributed to the overall rise in nonaccrual loans between the periods. 

    CRITICIZED LOANS   June 30,   March 31,   June 30,   Linked   Prior Year
    (Dollars in thousands)   2025   2025   2024   Quarter   Quarter
    CRE LOANS   Amount   Amount   Amount   $ Change   $ Change
    CRE   $ 2,046   $ 2,040   $ 3,926   $ 6     $ (1,880 )
    Commercial and speculative construction and development     9,083     6,487     4,737     2,596       4,346  
    Total CRE loans     11,129     8,527     8,663     2,602       2,466  
                                   
    RESIDENTIAL REAL ESTATE LOANS                              
    One-to-four-family (excludes HFS)     4,383     3,728     2,854     655       1,529  
    Home equity     251     252     156     (1 )     95  
    Total residential real estate loans     4,634     3,980     3,010     654       1,624  
                                   
    CONSUMER LOANS                              
    Indirect home improvement     3,365     2,821     2,319     544       1,046  
    Marine     567     649     327     (82 )     240  
    Other consumer     13     1     6     12       7  
    Total consumer loans     3,945     3,471     2,652     474       1,293  
                                   
    COMMERCIAL BUSINESS LOANS                              
    C&I     5,220     7,524     9,954     (2,304 )     (4,734 )
    Total criticized loans   $ 24,928   $ 23,502   $ 24,279   $ 1,426     $ 649  
                                       

    Operating Results

    Net interest income increased $1.7 million to $32.1 million for the three months ended June 30, 2025, from $30.4 million for the three months ended June 30, 2024, primarily due to an increase in total interest income of $2.8 million, partially offset by an increase in interest expense of $1.1 million. The $2.8 million increase in total interest income was primarily due to an increase of $2.6 million in interest income on loans receivable, including fees, primarily as a result of net loan growth. The $1.1 million increase in total interest expense was primarily the result of higher average balances of deposits and borrowings to fund asset growth.

    For the six months ended June 30, 2025, net interest income increased $2.3 million to $63.1 million, from $60.7 million for the six months ended June 30, 2024, with a $4.7 million increase in total interest income, partially offset by a $2.3 million increase in interest expense for the same reasons mentioned above. 

    NIM (annualized) increased one basis point to 4.30% for the three months ended June 30, 2025, from 4.29% for the same period in the prior year and increased four basis points from 4.27% to 4.31% for the six months ended June 30, 2025. The change in NIM for the three and six months ended June 30, 2025, compared to the same period in 2024, reflects the increased yields on interest-earning assets, as a result of loan growth and repricing activity. The improvement also reflects a favorable shift in the asset mix and disciplined management of deposit and funding costs. 

    The average total cost of funds, including noninterest-bearing checking, increased one basis point to 2.39% for the three months ended June 30, 2025, from 2.38% for the three months ended June 30, 2024. This increase was predominantly due to higher average balances in borrowings. The average cost of funds increased eight basis points to 2.38% for the six months ended June 30, 2025, from 2.30% for the six months ended June 30, 2024, primarily for the same reason noted above as well as growth in the deposit mix from the prior year. 

    For the three and six months ended June 30, 2025, the provision for credit losses on loans was $2.0 million and $3.6 million, compared to $1.1 million and $2.5 million for the three and six months ended June 30, 2024, respectively. The provision for credit losses on loans reflects net loan growth and an increase in net charge-off activity.

    During the three months ended June 30, 2025, net charge-offs decreased $63,000 to $1.2 million, compared to the same period the prior year. During the six months ended June 30, 2025, net charge-offs increased $184,000, to $2.9 million, compared to $2.7 million during the six months ended June 30, 2024. The increase was primarily due to a $1.2 million increase in net charge-offs on indirect home improvement loans, partially offset by a $693,000 decrease in net charge-offs on commercial business loans and a $271,000 decrease in net charge-offs on marine loans. Management attributes the increase in net charge-offs for the current six month period to continued volatile economic conditions.

    Total noninterest income decreased $698,000 to $5.2 million for the three months ended June 30, 2025, from $5.9 million for the three months ended June 30, 2024. The decrease primarily reflects a $491,000 decrease in gain on sale of loans, primarily due to a decrease of loans available for sale, a $156,000 decrease in service charges and fee income and a $151,000 decrease in gain on sale of investment securities due to no sales activity in the current quarter compared to the same period last year. Total noninterest income decreased $683,000, to $10.3 million, for the six months ended June 30, 2025, from $11.0 million for the six months ended June 30, 2024. This decrease was primarily the result of a $629,000 decrease in gain on sale of loans, a $464,000 decrease in service charges and fee income, and a net decrease of $368,000 from no activity in gain on sales of MSRs and loss on sale of investment securities compared to an $8.2 million net gain on sale of MSRs, offset by the $7.8 million loss on sale of investment securities that occurred in the first half of 2024. These decreases in total noninterest income were partially offset by a $755,000 increase in other noninterest income as result of sales of nonmarketable equity securities at a $312,000 gain, bank owned life insurance proceeds of $195,000, and a $101,000 increase in brokered loans fees.

    Total noninterest expense was $25.5 million for the three months ended June 30, 2025, compared to $23.9 million for the three months ended June 30, 2024.  The $1.6 million increase was primarily due to a $710,000 increase in salaries and benefits, primarily due to competitive wage adjustments, a $305,000 increase in operations expense, and a $267,000 increase in professional and board fees.  Total noninterest expense increased $3.2 million to $50.6 million for the six months ended June 30, 2025, compared to $47.4 million for the six months ended June 30, 2024. Increases during the six month period ended June 30, 2025, compared to the same period last year included $1.7 million in salaries and benefits, $742,000 in operations expense, and $531,000 in professional and board fees.

    About FS Bancorp

    FS Bancorp, Inc., a Washington corporation, is the holding company for 1st Security Bank of Washington. The Bank offers a range of loan and deposit services primarily to small- and middle-market businesses and individuals in Washington and Oregon.  It operates through 27 bank branches, one headquarters office that provides loans and deposit services, and loan production offices in various suburban communities in the greater Puget Sound area, the Kennewick-Pasco-Richland metropolitan area of Washington, also known as the Tri-Cities, and in Vancouver, Washington. Additionally, the Bank services home mortgage customers across the Northwest, focusing on markets in Washington State including the Puget Sound, Tri-Cities, and Vancouver.

    Forward-Looking Statements

    When used in this press release and in other documents filed with or furnished to the Securities and Exchange Commission (the “SEC”), in press releases or other public stockholder communications, or in oral statements made with the approval of an authorized executive officer, the words or phrases “believe,” “will,” “will likely result,” “are expected to,” “will continue,” “is anticipated,” “estimate,” “project,” “plans,” or similar expressions are intended to identify “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are not historical facts but instead represent management’s current expectations and forecasts regarding future events, many of which are inherently uncertain and outside of our control. Actual results may differ, possibly materially from those currently expected or projected in these forward-looking statements. Factors that could cause the Company’s actual results to differ materially from those described in the forward-looking statements, include but are not limited to, the following: adverse impacts to economic conditions in the Company’s local market areas, other markets where the Company has lending relationships, or other aspects of the Company’s business operations or financial markets, including, without limitation, as a result of employment levels; labor shortages, the effects of inflation, recessionary pressures or slowing economic growth; changes in interest rates and the duration of such changes, including actions by the Federal Reserve, which could adversely affect our revenues and expenses, the values of our assets and obligations, and the availability and cost of capital and liquidity; the impact of inflation and monetary and fiscal policy responses thereto and their impact on consumer and business behavior; geopolitical developments and international conflicts including but not limited to tensions or instability in Eastern Europe, the Middle east, and Asia, or the imposition of new or increased tariffs and trade restrictions, which may disrupt financial markets, global supply chains, energy prices, or economic activity in specific industry sectors; the effects of a federal government shutdown, debt ceiling standoff, or other fiscal policy uncertainty; increased competitive pressures, including repricing and competitors’ pricing initiatives, and their impact on our market position, loan, and deposit products; adverse changes in the securities markets, the Company’s ability to execute its plans to grow its residential construction lending, mortgage banking, and warehouse lending operations, and the geographic expansion of its indirect home improvement lending; challenges arising from expanding into new geographic markets, products, or services; secondary market conditions for loans and the Company’s ability to originate loans for sale and sell loans in the secondary market; volatility in the mortgage industry; fluctuations in deposits; liquidity issues, including our ability to borrow funds or raise additional capital, if necessary; the impact of bank failures or adverse developments at other banks and related negative press about the banking industry in general on investor and depositor sentiment; the ability to adapt to rapid technological changes, including advancements in artificial intelligence, digital banking, and cybersecurity; legislation or regulatory changes, including but not limited to shifts in capital requirements, banking regulation, tax laws, or consumer protection laws; vulnerabilities  in information systems or third-party service providers, including disruptions, breaches, or attacks; environmental, social and governance goals; the effects of climate change, severe weather events, natural disasters, pandemics, epidemics and other public health crises, acts of war or terrorism, domestic political unrest and other external events on our business; and other factors described in the Company’s latest Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, and other reports filed with or furnished to the SEC which are available on its website at www.fsbwa.com and on the SEC’s website at www.sec.gov.

    Any of the forward-looking statements that the Company makes in this press release and in the other public statements are based upon management’s beliefs and assumptions at the time they are made and may turn out to be incorrect because of the inaccurate assumptions the Company might make, because of the factors illustrated above or because of other factors that cannot be foreseen by the Company. Therefore, these factors should be considered in evaluating the forward-looking statements, and undue reliance should not be placed on such statements. The Company does not undertake and specifically disclaims 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.

     
    FS BANCORP, INC. AND SUBSIDIARY
    CONSOLIDATED BALANCE SHEETS
    (Dollars in thousands) (Unaudited)
                                         
                                Linked     Prior Year  
        June 30,     March 31,     June 30,     Quarter     Quarter  
    ASSETS   2025     2025     2024     % Change     % Change  
    Cash and due from banks   $ 15,168     $ 18,657     $ 20,005       (19 )     (24 )
    Interest-bearing deposits at other financial institutions     18,027       44,084       13,006       (59 )     39  
    Total cash and cash equivalents     33,195       62,741       33,011       (47 )     1  
    Certificates of deposit at other financial institutions     248       1,234       12,707       (80 )     (98 )
    Securities available-for-sale, at fair value     302,692       291,133       221,182       4       37  
    Securities held-to-maturity, net     31,562       10,434       8,455       202       273  
    Loans held for sale, at fair value     53,630       31,038       53,811       73       —  
    Loans receivable, net     2,582,272       2,501,117       2,457,184       3       5  
    Accrued interest receivable     14,270       14,406       13,792       (1 )     3  
    Premises and equipment, net     30,098       29,451       29,999       2       —  
    Operating lease right-of-use     7,969       4,979       5,784       60       38  
    Federal Home Loan Bank stock, at cost     11,579       5,256       10,322       120       12  
    Deferred tax asset, net     7,782       7,009       4,590       11       70  
    Bank owned life insurance (“BOLI”), net     38,262       38,778       38,201       (1 )     —  
    MSRs, held at the lower of cost or fair value     8,652       8,926       9,352       (3 )     (7 )
    Goodwill     3,592       3,592       3,592       —       —  
    Core deposit intangible, net     12,071       12,879       15,483       (6 )     (22 )
    Other assets     38,139       43,105       23,912       (12 )     59  
    TOTAL ASSETS   $ 3,176,013     $ 3,066,078     $ 2,941,377       4       8  
    LIABILITIES                                        
    Deposits:                                        
    Noninterest-bearing accounts   $ 654,069     $ 676,706     $ 623,349       (3 )     5  
    Interest-bearing accounts     1,899,306       1,938,445       1,759,454       (2 )     8  
    Total deposits     2,553,375       2,615,151       2,382,803       (2 )     7  
    Borrowings     234,305       68,805       181,895       241       29  
    Subordinated notes:                                        
    Principal amount     50,000       50,000       50,000       —       —  
    Unamortized debt issuance costs     (373 )     (389 )     (439 )     (4 )     (15 )
    Total subordinated notes less unamortized debt issuance costs     49,627       49,611       49,561       —       —  
    Operating lease liability     8,138       5,149       5,979       58       36  
    Other liabilities     33,365       28,522       37,113       17       (10 )
    Total liabilities     2,878,810       2,767,238       2,657,351       4       8  
    COMMITMENTS AND CONTINGENCIES                                        
    STOCKHOLDERS’ EQUITY                                        
    Preferred stock, $.01 par value; 5,000,000 shares authorized; none issued or outstanding     —       —       —       —       —  
    Common stock, $.01 par value; 45,000,000 shares authorized; 7,618,543 shares issued and outstanding at June 30, 2025, 7,742,907 at March 31, 2025, and 7,742,607 at June 30, 2024     76       77       77       (1 )     (1 )
    Additional paid-in capital     48,418       52,806       55,834       (8 )     (13 )
    Retained earnings     268,509       262,945       243,651       2       10  
    Accumulated other comprehensive loss, net of tax     (19,800 )     (16,988 )     (15,536 )     17       27  
    Total stockholders’ equity     297,203       298,840       284,026       (1 )     5  
    TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY   $ 3,176,013     $ 3,066,078     $ 2,941,377       4       8  
                                             
     
    FS BANCORP, INC. AND SUBSIDIARY
    CONSOLIDATED STATEMENTS OF INCOME
    (Dollars in thousands, except per share amounts) (Unaudited)
                       
        Three Months Ended     Linked     Prior Year  
        June 30,     March 31,     June 30,     Quarter     Quarter  
    INTEREST INCOME   2025     2025     2024     % Change     % Change  
    Loans receivable, including fees   $ 45,038     $ 43,303     $ 42,406       4       6  
    Interest and dividends on investment securities, cash and cash equivalents, and certificates of deposit at other financial institutions     3,665       3,485       3,534       5       4  
    Total interest and dividend income     48,703       46,788       45,940       4       6  
    INTEREST EXPENSE                                        
    Deposits     14,520       13,058       13,252       11       10  
    Borrowings     1,585       2,263       1,801       (30 )     (12 )
    Subordinated notes     486       485       486       —       —  
    Total interest expense     16,591       15,806       15,539       5       7  
    NET INTEREST INCOME     32,112       30,982       30,401       4       6  
    PROVISION FOR CREDIT LOSSES     2,021       1,592       1,077       27       88  
    NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES     30,091       29,390       29,324       2       3  
    NONINTEREST INCOME                                        
    Service charges and fee income     2,323       2,244       2,479       4       (6 )
    Gain on sale of loans     1,972       1,700       2,463       16       (20 )
    Gain on sale of investment securities, net     —       —       151       NM       NM  
    Earnings on cash surrender value of BOLI     254       250       242       2       5  
    Other noninterest income     621       932       533       (33 )     17  
    Total noninterest income     5,170       5,126       5,868       1       (12 )
    NONINTEREST EXPENSE                                        
    Salaries and benefits     14,088       14,533       13,378       (3 )     5  
    Operations     3,824       3,445       3,519       11       9  
    Occupancy     1,780       1,717       1,669       4       7  
    Data processing     2,137       2,045       2,058       4       4  
    Loan costs     719       548       653       31       10  
    Professional and board fees     1,155       1,186       888       (3 )     30  
    FDIC insurance     554       538       450       3       23  
    Marketing and advertising     398       221       377       80       6  
    Amortization of core deposit intangible     809       831       919       (3 )     (12 )
    Impairment (recovery) of servicing rights     38       (9 )     (54 )     (522 )     (170 )
    Total noninterest expense     25,502       25,055       23,857       2       7  
    INCOME BEFORE PROVISION FOR INCOME TAXES     9,759       9,461       11,335       3       (14 )
    PROVISION FOR INCOME TAXES     2,031       1,440       2,376       41       (15 )
    NET INCOME   $ 7,728     $ 8,021     $ 8,959       (4 )     (14 )
    Basic earnings per share   $ 1.00     $ 1.02     $ 1.15       (2 )     (13 )
    Diluted earnings per share   $ 0.99     $ 1.01     $ 1.13       (2 )     (12 )
                                             
     
    FS BANCORP, INC. AND SUBSIDIARY
    CONSOLIDATED STATEMENTS OF INCOME
    (Dollars in thousands, except per share amounts) (Unaudited)
                 
        Six Months Ended     Year  
        June 30,     June 30,     Over Year  
    INTEREST INCOME   2025     2024     % Change  
    Loans receivable, including fees   $ 88,340     $ 83,403       6  
    Interest and dividends on investment securities, cash and cash equivalents, and certificates of deposit at other financial institutions     7,150       7,417       (4 )
    Total interest and dividend income     95,490       90,820       5  
    INTEREST EXPENSE                        
    Deposits     27,578       26,134       6  
    Borrowings     3,848       2,968       30  
    Subordinated note     971       971       —  
    Total interest expense     32,397       30,073       8  
    NET INTEREST INCOME     63,093       60,747       4  
    PROVISION FOR CREDIT LOSSES     3,613       2,476       46  
    NET INTEREST INCOME AFTER PROVISION FOR CREDIT LOSSES     59,480       58,271       2  
    NONINTEREST INCOME                        
    Service charges and fee income     4,567       5,031       (9 )
    Gain on sale of loans     3,672       4,301       (15 )
    Gain on sale of MSRs     —       8,215       NM  
    Loss on sale of investment securities, net     —       (7,847 )     NM  
    Earnings on cash surrender value of BOLI     505       482       5  
    Other noninterest income     1,552       797       95  
    Total noninterest income     10,296       10,979       (6 )
    NONINTEREST EXPENSE                        
    Salaries and benefits     28,621       26,935       6  
    Operations     7,269       6,527       11  
    Occupancy     3,496       3,374       4  
    Data processing     4,182       4,016       4  
    Loan costs     1,267       1,238       2  
    Professional and board fees     2,342       1,811       29  
    FDIC insurance     1,092       982       11  
    Marketing and advertising     619       604       2  
    Amortization of core deposit intangible     1,639       1,860       (12 )
    Impairment of servicing rights     29       39       (26 )
    Total noninterest expense     50,556       47,386       7  
    INCOME BEFORE PROVISION FOR INCOME TAXES     19,220       21,864       (12 )
    PROVISION FOR INCOME TAXES     3,471       4,508       (23 )
    NET INCOME   $ 15,749     $ 17,356       (9 )
    Basic earnings per share   $ 2.02     $ 2.23       (9 )
    Diluted earnings per share   $ 1.99     $ 2.20       (10 )
                             

    KEY FINANCIAL RATIOS AND DATA (Unaudited)

        At or For the Three Months Ended  
        June 30,     March 31,     June 30,  
    PERFORMANCE RATIOS:   2025     2025     2024  
    Return on assets (ratio of net income to average total assets)(1)     0.99 %     1.07 %     1.22 %
    Return on equity (ratio of net income to average total stockholders’ equity)(1)     10.29       10.80       12.72  
    Yield on average interest-earning assets(1)     6.52       6.53       6.48  
    Average total cost of funds(1)     2.39       2.38       2.38  
    Interest rate spread information – average during period     4.13       4.15       4.10  
    Net interest margin(1)     4.30       4.32       4.29  
    Operating expense to average total assets(1)     3.28       3.35       3.26  
    Average interest-earning assets to average interest-bearing liabilities(1)     140.98       142.94       143.64  
    Efficiency ratio(2)     68.40       69.39       65.78  
    Common equity ratio (ratio of stockholders’ equity to total assets)     9.36       9.75       9.66  
    Tangible common equity ratio(3)     8.91       9.26       9.07  
        For the Six Months Ended  
        June 30,     June 30,  
    PERFORMANCE RATIOS:   2025     2024  
    Return on assets (ratio of net income to average total assets)     1.03 %     1.18 %
    Return on equity (ratio of net income to average total stockholders’ equity)     10.55       12.51  
    Yield on average interest-earning assets     6.52       6.39  
    Average total cost of funds     2.38       2.30  
    Interest rate spread information – average during period     4.14       4.09  
    Net interest margin     4.31       4.27  
    Operating expense to average total assets     3.32       3.23  
    Average interest-earning assets to average interest-bearing liabilities     141.93       144.07  
    Efficiency ratio(2)     68.89       66.07  
        June 30,     March 31,     June 30,  
    ASSET QUALITY RATIOS AND DATA:   2025     2025     2024  
    Nonperforming assets to total assets at end of period(4)     0.60 %     0.47 %     0.39 %
    Nonperforming loans to total gross loans (excluding loans HFS)(5)     0.73       0.57       0.46  
    Allowance for credit losses – loans to nonperforming loans(5)     168.89       219.08       273.95  
    Allowance for credit losses – loans to total gross loans (excluding loans HFS)     1.23       1.25       1.26  
        At or For the Three Months Ended    
        June 30,       March 31,       June 30,    
    PER COMMON SHARE DATA:   2025       2025       2024    
    Basic earnings per share   $ 1.00       $ 1.02       $ 1.15    
    Diluted earnings per share   $ 0.99       $ 1.01       $ 1.13    
    Weighted average basic shares outstanding     7,580,576         7,695,320         7,688,246    
    Weighted average diluted shares outstanding     7,698,173         7,805,728         7,796,253    
    Common shares outstanding at end of period     7,515,480   (6)     7,639,844   (7)     7,644,463   (8)
    Book value per share using common shares outstanding   $ 39.55       $ 39.12       $ 37.15    
    Tangible book value per share using common shares outstanding(9)   $ 37.46       $ 36.96       $ 34.66    

    __________________________

    (1)   Annualized.
    (2)   Total noninterest expense as a percentage of net interest income and total noninterest income.
    (3)   Represents a non-GAAP financial measure.  For a reconciliation to the most comparable GAAP financial measure, see “Non-GAAP Financial Measures” below.
    (4)   Nonperforming assets consist of nonperforming loans (which include nonaccruing loans and accruing loans more than 90 days past due), foreclosed real estate and other repossessed assets.
    (5)   Nonperforming loans consist of nonaccruing loans and accruing loans 90 days or more past due.
    (6)   Common shares were calculated using shares outstanding of 7,618,543 at June 30, 2025, less 103,063 unvested restricted stock shares.
    (7)   Common shares were calculated using shares outstanding of 7,742,907 at March 31, 2025, less 103,063 unvested restricted stock shares.
    (8)   Common shares were calculated using shares outstanding of 7,742,607 at June 30, 2024, less 98,144 unvested restricted stock shares.
    (9)   Tangible book value per share using outstanding common shares excludes intangible assets. This ratio represents a non-GAAP financial measure. See “Non-GAAP Financial Measures” below.
         
    (Dollars in thousands)   For the Three Months Ended June 30,     For the Six Months Ended June 30,     QTR Over QTR     YTD Over YTD  
    Average Balances   2025     2024     2025     2024     $ Change     $ Change  
    Assets                                                
    Loans receivable, net(1)   $ 2,612,959     $ 2,511,326     $ 2,586,598     $ 2,487,964     $ 101,633     $ 98,634  
    Securities available-for-sale, at amortized cost     332,705       283,422       321,622       307,417       49,283       14,205  
    Securities held-to-maturity     21,401       8,500       15,063       8,500       12,901       6,563  
    Interest-bearing deposits and certificates of deposit at other financial institutions     8,775       41,613       10,353       50,563       (32,838 )     (40,210 )
    FHLB stock, at cost     19,502       7,040       17,840       4,607       12,462       13,233  
    Total interest-earning assets     2,995,342       2,851,901       2,951,476       2,859,051       143,441       92,425  
    Noninterest-earning assets     121,018       95,930       123,191       94,138       25,088       29,053  
    Total assets   $ 3,116,360     $ 2,947,831     $ 3,074,667     $ 2,953,189     $ 168,529     $ 121,478  
    Liabilities                                                
    Interest-bearing deposit accounts   $ 1,924,586     $ 1,794,966     $ 1,845,534     $ 1,813,865     $ 129,620     $ 31,669  
    Borrowings     150,492       140,964       184,377       121,057       9,528       63,320  
    Subordinated notes     49,617       49,550       49,608       49,542       67       66  
    Total interest-bearing liabilities     2,124,695       1,985,480       2,079,519       1,984,464       139,215       95,055  
    Noninterest-bearing deposit accounts     657,820       637,345       660,805       647,214       20,475       13,591  
    Other noninterest-bearing liabilities     32,700       41,785       33,218       42,516       (9,085 )     (9,298 )
    Total liabilities   $ 2,815,215     $ 2,664,610     $ 2,773,542     $ 2,674,194     $ 150,605     $ 99,348  

    __________________________

    (1)   Includes loans HFS.
         

    Non-GAAP Financial Measures:

    In addition to financial results presented in accordance with generally accepted accounting principles utilized in the United States (“GAAP”), this earnings release presents non-GAAP financial measures that include tangible book value per share, and tangible common equity ratio. Management believes that providing the Company’s tangible book value per share and tangible common equity ratio is consistent with the capital treatment utilized by the investment community, which excludes intangible assets from the calculation of risk-based capital ratios and facilitates comparison of the quality and composition of the Company’s capital over time and to its competitors. Where applicable, the Company has also presented comparable GAAP information.

    These non-GAAP financial measures have inherent limitations, are not required to be uniformly applied, and are not audited. They should not be considered in isolation or as a substitute for total stockholders’ equity or operating results determined in accordance with GAAP. These non-GAAP measures may not be comparable to similarly titled measures reported by other companies.

    Reconciliation of the GAAP book value per share and common equity ratio and the non-GAAP tangible book value per share and tangible common equity ratio is presented below.

    (Dollars in thousands, except share and per share amounts)   June 30,   March 31,   June 30,  
    Tangible Book Value Per Share:   2025   2025   2024  
    Stockholders’ equity (GAAP)   $ 297,203     $ 298,840     $ 284,026    
    Less: goodwill and core deposit intangible, net     (15,663 )     (16,471 )     (19,075 )  
    Tangible common stockholders’ equity (non-GAAP)   $ 281,540     $ 282,369     $ 264,951    
                         
    Common shares outstanding at end of period     7,515,480   (1)   7,639,844   (2)   7,644,463   (3)
                         
    Book value per share (GAAP)   $ 39.55     $ 39.12     $ 37.15    
    Tangible book value per share (non-GAAP)   $ 37.46     $ 36.96     $ 34.66    
                         
    Tangible Common Equity Ratio:                    
    Total assets (GAAP)   $ 3,176,013     $ 3,066,078     $ 2,941,377    
    Less: goodwill and core deposit intangible assets     (15,663 )     (16,471 )     (19,075 )  
    Tangible assets (non-GAAP)   $ 3,160,350     $ 3,049,607     $ 2,922,302    
                         
    Common equity ratio (GAAP)     9.36   %   9.75   %   9.66   %
    Tangible common equity ratio (non-GAAP)     8.91       9.26       9.07    

    _________________________

    (1)   Common shares were calculated using shares outstanding of 7,618,543 at June 30, 2025, less 103,063 unvested restricted stock shares.
    (2)   Common shares were calculated using shares outstanding of 7,742,907 at March 31, 2025, less 103,063 unvested restricted stock shares.
    (3)   Common shares were calculated using shares outstanding of 7,742,607 at June 30, 2024, less 98,144 unvested restricted stock shares.
         

    Contacts:
    Joseph C. Adams,
    Chief Executive Officer
    Matthew D. Mullet,
    President
    Phillip D. Whittington,
    Chief Financial Officer

    (425) 771-5299
    www.FSBWA.com

    The MIL Network –

  • MIL-OSI: First Bank Announces Second Quarter 2025 Net Income of $10.2 Million

    Source: GlobeNewswire (MIL-OSI)

    HAMILTON, N.J. , July 22, 2025 (GLOBE NEWSWIRE) — First Bank (Nasdaq Global Market: FRBA) (“the Bank”) today announced results for the second quarter of 2025. Net income for the second quarter of 2025 was $10.2 million, or $0.41 per diluted share, compared to $11.1 million, or $0.44 per diluted share, for the second quarter of 2024. Return on average assets, return on average equity and return on average tangible equityi for the second quarter of 2025 were 1.04%, 9.77% and 11.16%, respectively, compared to 1.23%, 11.52% and 13.40%, respectively, for the second quarter of 2024. 

    Second Quarter 2025 Performance Highlights:

    • Total loans of $3.33 billion at June 30, 2025 grew $91.2 million, or 11.3%, annualized, from the linked quarter ended March 31, 2025.
    • Total deposits were $3.17 billion at June 30, 2025, increasing $48.4 million, or 6.2% annualized, from the linked quarter ended March 31, 2025.
    • Net interest margin measured 3.65% for the second quarter of 2025, remaining stable compared to the first quarter of 2025.
    • Tangible book value per shareii grew to $14.87 at June 30, 2025, increasing 11.1%, annualized, from $14.47 at March 31, 2025.
    • Strong asset quality continued, with nonperforming assets decreasing to 0.40% of total assets at June 30, 2025, compared to 0.42% at March 31, 2025 and 0.56% at June 30, 2024. 

    “We are pleased to report growth in high-quality loans and deposits that continues to enhance our core earnings profile,” said Patrick L. Ryan, President and CEO of First Bank. “Our team’s robust performance in expanding commercial and industrial (“C&I”) loans and non-interest bearing deposits during the first half of 2025 demonstrates effective execution of our strategy to grow deep middle market commercial relationships. We have achieved substantial organic growth in our primary areas of focus while maintaining a stable net interest margin, solid asset quality, and an efficiency ratio that remained below 60% for the 24th consecutive quarter. These successes positioned First Bank to deliver an 11.1% annualized increase in tangible book value per share during the second quarter.”

    Mr. Ryan added, “We anticipate our pace of loan growth will likely moderate in the second half of 2025 as we continue to prioritize relationship-building and profitability over volume amid continued competition in the deposit market. With a focus on continuing to maximize our risk-adjusted returns on shareholders’ equity, we expect to realize additional benefits from the prudent management of our capital, such as the reduced debt costs afforded by our recent subordinated debt issuance, and by delivering enhanced returns to our shareholders through share buybacks. Furthermore, we remain committed to proactive investments designed to scale our business and achieve top quartile profitability relative to our peers.”

    Income Statement

    In the second quarter of 2025, the Bank’s net interest income increased to $34.0 million, growing $3.5 million, or 11.4%, compared to the same period in 2024. The increase was primarily driven by an increase of $3.6 million in interest income, reflecting higher average loan balances, which outpaced the $140,000 increase in interest expense. Net interest income increased $1.9 million, or 6.0%, over the linked quarter of 2025. This increase was primarily driven by a $3.4 million increase in interest income, primarily due to higher average loan balances and yields, partially offset by an increase of $1.5 million in interest expense, primarily resulting from higher average borrowings during the second quarter of 2025.

    The Bank’s tax equivalent net interest margin measured 3.65% for the second quarter of 2025, increasing by three basis points from 3.62% for the prior year quarter, and remaining stable as compared to the linked quarter ended March 31, 2025. The modest improvement from the prior year quarter was driven by an improved interest rate spread, reflecting declines in average rates on deposits and borrowings which outpaced the reduction in average rates on earning assets. The Bank’s net interest margin remained stable as compared to the linked quarter primarily due to a slight increase in average rates on loans and a slight decrease in average rate on deposits, offset by the increased cost on subordinated debt. The Bank’s tax equivalent net interest margin includes the impact of amortization and accretion of premiums and discounts from fair value measurements of assets acquired and liabilities assumed in acquisitions. The net impact of amortization of premiums and accretion of discounts from fair value measurements of assets acquired and liabilities assumed in acquisitions was a $2.7 million increase in net interest income during the second quarter of 2025, compared to $2.8 million for the quarter ended March 31, 2025.

    The Bank recorded a credit loss expense totaling $2.6 million during the second quarter of 2025, compared to credit loss expense totaling $1.5 million for the first quarter of 2025 and $63,000 for the second quarter of 2024. The increased credit loss expense for the second quarter of 2025 is primarily due to the Bank’s loan growth during the quarter, and to a lesser extent, slight increases in net charge-offs and specific reserves. The Bank’s credit loss expense for the second quarter of 2024 reflected the Bank’s strong and stable asset quality and modest loan growth during the quarter.

    In the second quarter of 2025, the Bank recorded non-interest income totaling $2.7 million, compared to $689,000 during the same period in 2024 and $2.0 million during the first quarter of 2025. Non-interest income increased from both periods primarily due to higher loan fee income and a $397,000 gain on the sale of a corporate facility acquired through Malvern acquisition. Additionally, during the second quarter of 2024, the Bank recorded approximately $900,000 in net realized losses on the sale of certain loans as part of its balance sheet repositioning initiatives taken following its acquisition of Malvern Bank in 2023.

    Non-interest expense for the second quarter of 2025 was $20.9 million, an increase of $2.9 million, or 16.2%, compared to $18.0 million for the prior year quarter. Higher non-interest expense was largely due to an increase of $1.1 million in salaries and employee benefits related to a larger employee base and $863,000 in one-time executive severance payments, a $429,000 increase in other expense primarily due to a settlement loss of $220,000 relating to a letter of credit commitment acquired through the Malvern Bank acquisition and other miscellaneous increases related to the Bank’s significant growth over the last twelve months, and $268,000 in higher occupancy and equipment costs due to ongoing branch network optimization initiatives and new branch locations added over the past year.

    On a linked quarter basis, non-interest expense increased $483,000 from $20.4 million for the first quarter of 2025. The linked quarter growth primarily reflects increases of $841,000 in salaries and employee benefits costs primarily related to the aforementioned executive severance payments and settlement loss during the second quarter. This was partially offset by a decrease in other real estate owned (“OREO”) expense due to an $815,000 impairment of an OREO asset recorded during the linked quarter and the subsequent $34,000 gain on the sale of that property during second quarter 2025.

    Income tax expense for the three months ended June 30, 2025 was $3.0 million with an effective tax rate of 22.9%, compared to $2.1 million with an effective tax rate of 16.2% for the second quarter of 2024. The effective tax rate for the second quarter of 2024 was lower due to the recognition of a $1.1 million tax benefit associated with the enactment of the New Jersey Corporate Transit Fee during that period and the related revaluation of the Bank’s deferred tax assets. Income tax expense for the six months ended June 30, 2025 was $5.8 million with an effective tax rate of 22.8%. We anticipate our future effective tax rate will be relatively stable and should not be significantly impacted by any recent legislative tax changes.

    On July 4, 2025, subsequent to the end of the Company’s second fiscal quarter, the one big beautiful bill (“OBBB”) was enacted into law. The legislation includes a number of significant tax-related provisions, including changes affecting corporate tax incentives, international tax provisions, and various business credits and deductions. Pursuant to ASC 740, Income Taxes, the Company will recognize the effects of the OBBB in the third fiscal quarter of 2025, the period in which the legislation was enacted. The Company is currently evaluating the potential impact of the OBBB on its financial statements and, based on its preliminary assessment, does not expect the legislation to have a material impact.

    Balance Sheet

    The Bank reported total assets of $4.02 billion as of June 30, 2025, an increase of $403.6 million, or 11.2%, from $3.62 billion at June 30, 2024. Total loans increased $329.3 million, or 11.0%, to $3.33 billion at June 30, 2025 compared to $3.00 billion at June 30, 2024. The increase reflects strong organic loan growth, particularly in the C&I and owner-occupied commercial real estate portfolios. 

    Total assets increased $239.0 million, or 6.3%, from December 31, 2024 to June 30, 2025. Total loans as of June 30, 2025 increased $183.0 million, or 5.8%, from $3.14 billion at December 31, 2024, reflecting strong organic loan growth, particularly in the C&I and owner-occupied commercial real estate portfolios. The Bank’s cash and cash equivalents increased by $73.0 million, or 26.8%, compared to December 31, 2024, as management continued to maintain adequate on-balance sheet liquidity. 

    The Bank reported total deposits of $3.17 billion as of June 30, 2025, an increase of $200.6 million, or 6.8%, from $2.97 billion at June 30, 2024. Deposit growth was primarily due to our team’s success in attracting new deposit relationships while also maintaining existing balances amid heightened industry-wide pricing competition. Total deposits as of June 30, 2025 increased by $112.3 million, or 3.7%, from $3.06 billion at December 31, 2024, due to a combination of in-market commercial and consumer balances, offset somewhat by a decline in government related deposit balances. Compared to December 31, 2024, non-interest bearing demand deposits increased by $70.9 million to comprise 18.6% of total deposits, up from 17.0%. Over the same period, interest-bearing demand deposits decreased by $75.2 million to comprise 17.5% of total deposits at June 30, 2025, down from 20.6% at December 31, 2024. Time deposits expanded by $73.4 million, or 10.3%, during the first half of 2025.

    During the six months ended June 30, 2025, stockholders’ equity increased by $13.2 million, or 3.2%, primarily due to net income, partially offset by dividends and share repurchases.

    As of June 30, 2025, the Bank continued to exceed all regulatory capital requirements to be considered well-capitalized. The tangible stockholders’ equity to tangible assets ratioiii measured 9.34% as of June 30, 2025 compared to 9.56% at December 31, 2024. The decline from December 31, 2024, was primarily due to the asset growth during the period.

    Asset Quality

    First Bank’s asset quality metrics remained favorable during the second quarter of 2025. Total nonperforming assets declined from $17.3 million at December 31, 2024 to $16.0 million at June 30, 2025, primarily due to the sale of the Bank’s OREO asset during the second quarter of 2025, partially offset by the addition of nonperforming loans. Total nonperforming loans increased from $11.7 million at December 31, 2024 to $16.0 million at June 30, 2025.

    The Bank recorded net charge-offs of $796,000 during the second quarter of 2025, compared to net recoveries of $15,000 in the first quarter of 2025 and net charge-offs of $175,000 in the second quarter of 2024. The allowance for credit losses on loans as a percentage of total loans measured 1.23% at June 30, 2025, compared to 1.21% at both March 31, 2025 and June 30, 2024.

    Liquidity and Borrowings

    Management believes the Bank’s current liquidity position, coupled with our various contingent funding sources, provides the Bank with a strong liquidity base and a diverse source of funding options. The Bank’s cash and cash equivalents increased by $56.8 million, or 19.7%, compared to March 31, 2025, ensuring adequate on-balance sheet liquidity. Borrowings increased by $44.9 million compared to March 31, 2025, as the Bank utilized Federal Home Loan Bank (“FHLB”) advances to support loan growth, while continuing to maintain adequate available borrowing capacity at the FHLB.

    Subordinated Debt Issuance

    On June 18, 2025, the Bank announced the closing of a $35.0 million private placement of fixed-to-floating rate subordinated notes with a maturity date of June 30, 2035 and a fixed rate of interest of 7.125% per annum for the first five years. Thereafter, the notes will pay interest at a floating rate, reset quarterly, equal to the then current three-month Secured Overnight Financing Rate (“SOFR”) plus 343 basis points. The notes may be redeemed at the option of the Bank, without penalty, on or after June 30, 2030. The Bank intends to use the proceeds of this issuance to redeem the Bank’s $30.0 million fixed-to-floating rate subordinated notes due June 1, 2030 (the “2020 notes”) on September 1, 2025, as well as for general corporate purposes. Previously, the 2020 notes carried a fixed rate of 5.50% per annum. On June 1, 2025, the 2020 notes began repricing quarterly at a rate equal to the current three-month term SOFR rate plus 538 basis points. The 2020 notes repriced to a rate of 9.704% per annum on June 1, 2025. The notes have been structured to qualify as Tier 2 capital for regulatory purposes.

    Cash Dividend Declared

    On July 15, 2025, the Bank’s Board of Directors declared a quarterly cash dividend of $0.06 per share to common stockholders of record at the close of business on August 8, 2025, payable on August 22, 2025.

    Share Repurchase Program

    During the second quarter of 2025 the Bank repurchased 193,185 shares of common stock at an average price of $14.71 per share, under the share repurchase program authorized in October 2024. Through June 30, 2025, 543,185 shares have been repurchased from the current share repurchase plan with a total cost of $8.0 million or $14.81 per share on average. The share repurchase program provides for the repurchase of up to 1.0 million shares of First Bank common stock with an aggregate repurchase amount of up to $16.0 million. The share repurchase program will expire on September 30, 2025.

    Conference Call and Earnings Release Supplement

    Additional details on the quarterly results and the Bank are included in the attached earnings release supplement. http://ml.globenewswire.com/Resource/Download/5917a538-bdcd-4a25-b364-99fd7d36addb

    First Bank will host its earnings call on Wednesday, July 23, 2025 at 9:00 AM Eastern Time. The direct dial toll free number for the live call is 1-800-715-9871 and the access code is 3909613. For those unable to participate in the call, a replay will be available by dialing 1-800-770-2030 (access code 3909613) from one hour after the end of the conference call until October 21, 2025. Replay information will also be available on First Bank’s website at www.firstbanknj.com under the “About Us” tab. Click on “Investor Relations” to access the replay of the conference call.

    About First Bank

    First Bank is a New Jersey state-chartered bank with 27 full-service branches in Cinnaminson, Delanco, Denville, Ewing, Fairfield, Flemington, Hamilton, Lawrence, Monroe, Morristown, Pennington, Randolph, Somerset, Summit, Trenton and Williamstown, New Jersey; Coventry, Devon, Doylestown, Lionville, Malvern, Media, Paoli, Trevose, Warminster and West Chester, Pennsylvania; and Palm Beach, Florida. With $4.02 billion in assets as of June 30, 2025, First Bank offers a full range of deposit and loan products to individuals and businesses throughout the New York City to Philadelphia corridor. First Bank’s common stock is listed on the Nasdaq Global Market under the symbol “FRBA.”

    Forward Looking Statements

    This press release contains certain forward-looking statements, either express or implied, within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include information regarding First Bank’s future financial performance, business and growth strategy, projected plans and objectives, and related transactions, integration of acquired businesses, ability to recognize anticipated operational efficiencies, and other projections based on macroeconomic and industry trends, which are inherently unreliable due to the multiple factors that impact economic trends, and any such variations may be material. Such forward-looking statements are based on various facts and derived utilizing important assumptions, current expectations, estimates and projections about First Bank, any of which may change over time and some of which may be beyond First Bank’s control. Statements preceded by, followed by or that otherwise include the words “believes,” “expects,” “anticipates,” “intends,” “projects,” “estimates,” “plans” and similar expressions or future or conditional verbs such as “will,” “should,” “would,” “may” and “could” are generally forward-looking in nature and not historical facts, although not all forward-looking statements include the foregoing. Further, certain factors that could affect our future results and cause actual results to differ materially from those expressed in the forward-looking statements include, but are not limited to: whether First Bank can: successfully implement its growth strategy, including identifying acquisition targets and consummating suitable acquisitions, integrate acquired entities and realize anticipated efficiencies, sustain its internal growth rate, and provide competitive products and services that appeal to its customers and target markets; difficult market conditions and unfavorable economic trends in the United States generally, and particularly in the market areas in which First Bank operates and in which its loans are concentrated, including the effects of declines in housing market values; the impact of public health emergencies, on First Bank, its operations and its customers and employees; an increase in unemployment levels and slowdowns in economic growth; First Bank’s level of nonperforming assets and the costs associated with resolving any problem loans including litigation and other costs; changes in market interest rates may increase funding costs and reduce earning asset yields thus reducing margin; the impact of changes in interest rates and the credit quality and strength of underlying collateral and the effect of such changes on the market value of First Bank’s investment securities portfolio; the extensive federal and state regulation, supervision and examination governing almost every aspect of First Bank’s operations, including changes in regulations affecting financial institutions and expenses associated with complying with such regulations; uncertainties in tax estimates and valuations, including due to changes in state and federal tax law; First Bank’s ability to comply with applicable capital and liquidity requirements, including First Bank’s ability to generate liquidity internally or raise capital on favorable terms, including continued access to the debt and equity capital markets; and possible changes in trade, monetary and fiscal policies, laws and regulations and other activities of governments, agencies, and similar organizations. For discussion of these and other risks that may cause actual results to differ from expectations, please refer to “Forward-Looking Statements” and “Risk Factors” in First Bank’s Annual Report on Form 10-K and any updates to those risk factors set forth in First Bank’s proxy statement, subsequent Quarterly Reports on Form 10-Q or Current Reports on Form 8-K. If one or more events related to these or other risks or uncertainties materialize, or if First Bank’s underlying assumptions prove to be incorrect, actual results may differ materially from what First Bank anticipates. Accordingly, you should not place undue reliance on any such forward-looking statements. Any forward-looking statement speaks only as of the date on which it is made, and First Bank does not undertake any obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise. All forward-looking statements expressed or implied, included in this communication are expressly qualified in their entirety by this cautionary statement. This cautionary statement should also be considered in connection with any subsequent written or oral forward-looking statements that First Bank or persons acting on First Bank’s behalf may issue.                                                                                                                                                  

    This press release contains “non-GAAP” financial measures, which management uses in its analysis of First Bank’s performance. Management believes these non-GAAP financial measures allow for better comparability of period to period operating performance. Additionally, First Bank believes this information is utilized by regulators and market analysts to evaluate a company’s financial condition and therefore, such information is useful to investors. These disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies. A reconciliation of the non-GAAP measures used in this presentation to the most directly comparable GAAP measures is provided in the accompanying financial tables.

    i Return on average tangible equity is a non-GAAP financial measure and is calculated by dividing net income by average tangible equity (average equity minus average goodwill and other intangible assets). For a reconciliation of this non-GAAP financial measure, along with the other non-GAAP financial measures in this press release, to their comparable GAAP measures, see the financial reconciliations at the end of this press release.

    ii Tangible book value per share is a non-GAAP financial measure and is calculated by dividing common shares outstanding by tangible equity (equity minus goodwill and other intangible assets).  For a reconciliation of this non-GAAP financial measure, along with the other non-GAAP financial measures in this press release, to their comparable GAAP measures, see the financial reconciliations at the end of this press release.

    iii Tangible stockholders’ equity to tangible assets ratio is a non-GAAP financial measure and is calculated by dividing tangible equity (equity minus goodwill and other intangible assets) by tangible assets (total assets minus goodwill and other intangible assets). For a reconciliation of this non-GAAP financial measure, along with the other non-GAAP financial measures in this press release, to their comparable GAAP measures, see the financial reconciliations at the end of this press release.

    FIRST BANK
    CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
    (in thousands, except for share data, unaudited)
     
        June 30, 2025   December 31, 2024
    Assets            
    Cash and due from banks   $ 35,860     $ 18,252  
    Restricted cash     9,900       14,270  
    Interest bearing deposits with banks     299,131       239,392  
    Cash and cash equivalents     344,891       271,914  
    Interest bearing time deposits with banks     747       743  
    Investment securities available for sale, at fair value (amortized cost of $86,666 and $84,083, respectively)     81,891       77,413  
    Equity securities, at fair value     1,904       1,870  
    Investment securities held to maturity, net of allowance for credit losses of $203 and $206, respectively (fair value of $41,941 and $42,770, respectively)     45,749       47,123  
    Restricted investment in bank stocks     18,009       14,333  
    Other investments     13,556       11,612  
    Loans held for sale     2,127       –  
    Loans, net of deferred fees and costs     3,327,288       3,144,266  
    Less: Allowance for credit losses     (40,877)       (37,773)  
    Net loans     3,286,411       3,106,493  
    Premises and equipment, net     17,987       21,351  
    Other real estate owned, net     –       5,637  
    Accrued interest receivable     14,505       14,267  
    Bank-owned life insurance     86,980       85,553  
    Goodwill     44,166       44,166  
    Other intangible assets, net     7,860       8,827  
    Deferred income taxes, net     25,032       25,528  
    Other assets     27,520       43,516  
    Total assets   $ 4,019,335     $ 3,780,346  
                 
    Liabilities and Stockholders’ Equity            
    Liabilities:            
    Non-interest bearing deposits   $ 590,209     $ 519,320  
    Interest bearing deposits     2,578,004       2,536,576  
    Total deposits     3,168,213       3,055,896  
    Borrowings     326,802       246,933  
    Subordinated debentures     64,343       29,954  
    Accrued interest payable     4,443       3,820  
    Other liabilities     33,155       34,587  
    Total liabilities     3,596,956       3,371,190  
    Stockholders’ Equity:            
    Preferred stock, par value $2 per share; 10,000,000 shares authorized; no shares issued and outstanding     –       –  
    Common stock, par value $5 per share; 40,000,000 shares authorized; 27,630,039 shares issued and 24,905,790 shares outstanding and 27,375,439 shares issued and 25,100,829 shares outstanding, respectively     136,640       135,495  
    Additional paid-in capital     125,290       124,524  
    Retained earnings     193,395       176,779  
    Accumulated other comprehensive loss     (3,525)       (4,925)  
    Treasury stock, 2,724,249 and 2,274,610 shares, respectively     (29,421)       (22,717)  
    Total stockholders’ equity     422,379       409,156  
    Total liabilities and stockholders’ equity   $ 4,019,335     $ 3,780,346  
                     
    FIRST BANK
    CONSOLIDATED STATEMENTS OF INCOME
    (in thousands, except for share data, unaudited)
     
        Three Months Ended June 30,   Six Months Ended June 30,
        2025     2024     2025     2024  
    Interest and Dividend Income                            
    Investment securities—taxable   $ 1,246     $ 1,278     $ 2,434     $ 2,460  
    Investment securities—tax-exempt     41       36       92       74  
    Interest bearing deposits with banks, Federal funds sold and other     3,487       3,482       6,484       6,507  
    Loans, including fees     54,394       50,763       105,946       100,082  
    Total interest and dividend income     59,168       55,559       114,956       109,123  
                                 
    Interest Expense                            
    Deposits     21,276       22,386       42,120       43,172  
    Borrowings     3,256       2,193       5,668       4,309  
    Subordinated debentures     627       440       1,067       784  
    Total interest expense     25,159       25,019       48,855       48,265  
    Net interest income     34,009       30,540       66,101       60,858  
    Credit loss expense (benefit)     2,558       63       4,102       (635)  
    Net interest income after credit loss expense (benefit)     31,451       30,477       61,999       61,493  
                                 
    Non-Interest Income                            
    Service fees on deposit accounts     382       350       738       694  
    Loan fees     568       117       894       219  
    Income from bank-owned life insurance     723       609       1,516       1,394  
    Gains on sale of loans, net     75       (900)       104       (671)  
    Gains on recovery of acquired loans     100       56       124       174  
    Gain on sale of other assets     397       –       397       –  
    Other non-interest income     457       457       900       843  
    Total non-interest income     2,702       689       4,673       2,653  
                                 
    Non-Interest Expense                            
    Salaries and employee benefits     11,959       9,968       23,077       20,006  
    Occupancy and equipment     2,350       2,082       4,814       4,108  
    Legal fees     279       240       647       556  
    Other professional fees     924       929       1,650       1,685  
    Regulatory fees     684       640       1,368       1,242  
    Directors’ fees     260       270       542       512  
    Data processing     893       749       1,698       1,555  
    Marketing and advertising     503       377       902       673  
    Travel and entertainment     251       285       487       529  
    Insurance     233       251       447       495  
    Other real estate owned expense, net     69       129       989       217  
    Other expense     2,462       2,033       4,630       4,185  
    Total non-interest expense     20,867       17,953       41,251       35,763  
    Income Before Income Taxes     13,286       13,213       25,421       28,383  
    Income tax expense     3,047       2,140       5,801       4,798  
    Net Income   $ 10,239     $ 11,073     $ 19,620     $ 23,585  
                                 
    Basic earnings per common share   $ 0.41     $ 0.44     $ 0.78     $ 0.94  
    Diluted earnings per common share   $ 0.41     $ 0.44     $ 0.77     $ 0.93  
                                 
    Basic weighted average common shares outstanding     25,029,164       25,129,199       25,073,368       25,084,558  
    Diluted weighted average common shares outstanding     25,234,120       25,258,785       25,335,743       25,228,888  
    FIRST BANK
    AVERAGE BALANCE SHEETS WITH INTEREST AND AVERAGE RATES
    (dollars in thousands, unaudited)
     
        Three Months Ended June 30,
        2025     2024  
        Average         Average   Average         Average
        Balance   Interest   Rate (5)   Balance   Interest   Rate (5)
    Interest earning assets                                    
    Investment securities (1) (2)   $ 135,094     $ 1,295       3.84 %   $ 146,289     $ 1,321       3.63 %
    Loans (3)     3,296,031       54,394       6.62 %     2,997,892       50,763       6.81 %
    Interest bearing deposits with banks,                                    
    Federal funds sold and other     276,488       3,079       4.47 %     224,503       3,101       5.56 %
    Restricted investment in bank stocks     17,960       276       6.16 %     11,178       243       8.74 %
    Other investments     15,402       132       3.44 %     12,136       138       4.57 %
    Total interest earning assets (2)     3,740,975       59,176       6.34 %     3,391,998       55,566       6.59 %
    Allowance for credit losses     (39,507)                   (36,784)              
    Non-interest earning assets     251,475                   263,698              
    Total assets   $ 3,952,943                 $ 3,618,912              
                                         
    Interest bearing liabilities                                    
    Interest bearing demand deposits   $ 606,838     $ 3,701       2.45 %   $ 591,222     $ 3,813       2.59 %
    Money market deposits     1,064,363       8,917       3.36 %     1,061,593       10,559       4.00 %
    Savings deposits     140,301       694       1.98 %     158,158       619       1.57 %
    Time deposits     781,299       7,964       4.09 %     678,197       7,395       4.39 %
    Total interest bearing deposits     2,592,801       21,276       3.29 %     2,489,170       22,386       3.62 %
    Borrowings     319,494       3,256       4.09 %     171,533       2,193       5.14 %
    Subordinated debentures     34,966       627       7.17 %     29,880       440       5.89 %
    Total interest bearing liabilities     2,947,261       25,159       3.42 %     2,690,583       25,019       3.74 %
    Non-interest bearing deposits     548,279                   497,205              
    Other liabilities     36,960                   44,480              
    Stockholders’ equity     420,443                   386,644              
    Total liabilities and stockholders’ equity   $ 3,952,943                 $ 3,618,912              
    Net interest income/interest rate spread (2)           34,017       2.92 %           30,547       2.85 %
    Net interest margin (2) (4)                 3.65 %                 3.62 %
    Tax equivalent adjustment (2)           (8)                   (7)        
    Net interest income         $ 34,009                 $ 30,540        
    (1) Average balance of investment securities available for sale is based on amortized cost.
    (2) Interest and average rates are presented on a tax equivalent basis using a federal income tax rate of 21%.
    (3) Average balances of loans include loans on nonaccrual status.
    (4) Net interest income divided by average total interest earning assets.
    (5) Annualized.
    FIRST BANK
    AVERAGE BALANCE SHEETS WITH INTEREST AND AVERAGE RATES
    (dollars in thousands, unaudited)
     
        Six Months Ended June 30,
        2025     2024  
        Average         Average   Average         Average
        Balance   Interest   Rate (5)   Balance   Interest   Rate (5)
    Interest earning assets                                    
    Investment securities(1) (2)   $ 134,686     $ 2,545       3.81 %   $ 146,719     $ 2,549       3.49 %
    Loans(3)     3,233,747       105,946       6.61 %     2,988,707       100,082       6.73 %
    Interest bearing deposits with banks,                                    
    Federal funds sold and other     255,378       5,654       4.46 %     213,831       5,811       5.46 %
    Restricted investment in bank stocks     16,059       576       7.23 %     10,800       442       8.23 %
    Other investments     14,731       254       3.48 %     12,003       254       4.26 %
    Total interest earning assets(2)     3,654,601       114,975       6.34 %     3,372,060       109,138       6.51 %
    Allowance for credit losses     (38,847)                   (37,196)              
    Non-interest earning assets     256,261                   262,465              
    Total assets   $ 3,872,015                 $ 3,597,329              
                                     
    Interest bearing liabilities                                    
    Interest bearing demand deposits   $ 625,682     $ 7,728       2.49 %   $ 605,081     $ 7,479       2.49 %
    Money market deposits     1,054,742       17,548       3.36 %     1,038,250       20,348       3.94 %
    Savings deposits     141,395       1,344       1.92 %     160,135       1,193       1.50 %
    Time deposits     749,765       15,500       4.17 %     674,872       14,152       4.22 %
    Total interest bearing deposits     2,571,584       42,120       3.30 %     2,478,338       43,172       3.50 %
    Borrowings     277,245       5,668       4.12 %     169,337       4,309       5.12 %
    Subordinated debentures     32,478       1,067       6.57 %     36,175       784       4.33 %
    Total interest bearing liabilities     2,881,307       48,855       3.42 %     2,683,850       48,265       3.62 %
    Non-interest bearing deposits     534,877                   489,353              
    Other liabilities     38,755                   42,534              
    Stockholders’ equity     417,076                   381,592              
    Total liabilities and stockholders’ equity   $ 3,872,015                 $ 3,597,329              
    Net interest income/interest rate spread(2)           66,120       2.92 %           60,873       2.89 %
    Net interest margin(2) (4)                 3.65 %                 3.63 %
    Tax equivalent adjustment(2)           (19)                   (15)        
    Net interest income         $ 66,101                 $ 60,858        

    (1) Average balance of investment securities available for sale is based on amortized cost.
    (2) Interest and average rates are presented on a tax equivalent basis using a federal income tax rate of 21%.
    (3) Average balances of loans include loans on nonaccrual status.
    (4) Net interest income divided by average total interest earning assets.
    (5) Annualized.

    FIRST BANK
    QUARTERLY FINANCIAL HIGHLIGHTS
    (in thousands, except for share and employee data, unaudited)
     
        As of or For the Quarter Ended
        6/30/2025   3/31/2025   12/31/2024   9/30/2024   6/30/2024
    EARNINGS                              
    Net interest income   $ 34,009     $ 32,092     $ 31,594     $ 30,094     $ 30,540  
    Credit loss expense     2,558       1,544       234       1,579       63  
    Non-interest income     2,702       1,971       2,176       2,479       689  
    Non-interest expense     20,867       20,384       19,124       18,644       17,953  
    Income tax expense     3,047       2,754       3,915       4,188       2,140  
    Net income     10,239       9,381       10,497       8,162       11,073  
                                   
    PERFORMANCE RATIOS                              
    Return on average assets(1)     1.04%       1.00%       1.10%       0.88%       1.23%  
    Return on average equity(1)     9.77%       9.20%       10.27%       8.15%       11.52%  
    Return on average tangible equity(1) (2)     11.16%       10.54%       11.82%       9.42%       13.40%  
    Net interest margin(1) (3)     3.65%       3.65%       3.54%       3.48%       3.62%  
    Yield on loans(1)     6.62%       6.59%       6.62%       6.73%       6.81%  
    Total cost of deposits(1)     2.72%       2.75%       2.89%       3.06%       3.01%  
    Efficiency ratio(2)     56.24%       57.65%       56.98%       58.49%       55.88%  
                                   
    SHARE DATA                              
    Common shares outstanding     24,905,790       25,045,612       25,100,829       25,186,920       25,144,983  
    Basic earnings per share   $ 0.41     $ 0.37     $ 0.42     $ 0.32     $ 0.44  
    Diluted earnings per share     0.41       0.37       0.41       0.32       0.44  
    Book value per share     16.96       16.57       16.30       15.96       15.61  
    Tangible book value per share(2)     14.87       14.47       14.19       13.84       13.46  
                                   
    MARKET DATA                              
    Market value per share   $ 15.47     $ 14.81     $ 14.07     $ 15.20     $ 12.74  
    Market value / Tangible book value(2)     104.03%       102.35%       99.16%       109.83%       94.65%  
    Market capitalization   $ 385,293     $ 370,926     $ 353,169     $ 382,841     $ 320,347  
                                   
    CAPITAL & LIQUIDITY                              
    Stockholders’ equity / assets     10.51%       10.69%       10.82%       10.70%       10.86%  
    Tangible stockholders’ equity / tangible assets(2)     9.34%       9.47%       9.56%       9.41%       9.50%  
    Loans / deposits     105.02%       103.73%       102.89%       101.23%       101.02%  
                                   
    ASSET QUALITY                              
    Net charge-offs (recoveries)   $ 796     $ (15)     $ (155)     $ 386     $ 175  
    Nonperforming loans     15,978       11,584       11,677       12,014       14,227  
    Nonperforming assets     15,978       16,406       17,314       17,651       20,226  
    Net charge offs (recoveries)/ average loans(1)     0.10%       (0.00%)       (0.02%)       0.05%       0.02%  
    Nonperforming loans / total loans     0.48%       0.36%       0.37%       0.39%       0.47%  
    Nonperforming assets / total assets     0.40%       0.42%       0.46%       0.47%       0.56%  
    Allowance for credit losses on loans / total loans     1.23%       1.21%       1.20%       1.21%       1.21%  
    Allowance for credit losses on loans / nonperforming loans     255.83%       338.60%       323.48%       311.59%       254.81%  
                                   
    OTHER DATA                              
    Total assets   $ 4,019,335     $ 3,880,759     $ 3,780,346     $ 3,757,653     $ 3,615,731  
    Total loans     3,327,288       3,236,039       3,144,266       3,087,488       2,998,029  
    Total deposits     3,168,213       3,119,794       3,055,896       3,050,070       2,967,634  
    Total stockholders’ equity     422,379       414,915       409,156       402,070       392,489  
    Number of full-time equivalent employees     335       315       318       313       294  

    (1) Annualized.
    (2) Non-U.S. GAAP financial measure that we believe provides management and investors with information that is useful in understanding our financial performance and condition. See accompanying table, “Non-U.S. GAAP Financial Measures,” for calculation and reconciliation.
    (3) Tax equivalent using a federal income tax rate of 21%.

    FIRST BANK
    QUARTERLY FINANCIAL HIGHLIGHTS
    (dollars in thousands, unaudited)
     
        As of the Quarter Ended
        6/30/2025   3/31/2025   12/31/2024   9/30/2024   6/30/2024
    LOAN COMPOSITION                              
    Commercial and industrial   $ 706,849     $ 651,690     $ 576,625     $ 546,541     $ 530,996  
    Commercial real estate:                              
    Owner-occupied     707,766       694,113       671,357       688,988       647,625  
    Investor     1,192,716       1,160,549       1,181,684       1,170,508       1,143,954  
    Construction and development     161,361       200,262       205,096       193,460       190,108  
    Multi-family     309,189       308,217       287,843       267,861       270,238  
    Total commercial real estate     2,371,032       2,363,141       2,345,980       2,320,817       2,251,925  
    Residential real estate:                              
    Residential mortgage and first lien home equity loans     160,935       142,298       142,769       144,081       144,978  
    Home equity–second lien loans and revolving lines of credit     62,738       52,438       51,020       49,763       46,882  
    Total residential real estate     223,673       194,736       193,789       193,844       191,860  
    Consumer and other     29,248       29,760       31,324       29,518       26,321  
    Total loans prior to deferred loan fees and costs     3,330,802       3,239,327       3,147,718       3,090,720       3,001,102  
    Net deferred loan fees and costs     (3,514)       (3,288)       (3,452)       (3,232)       (3,073)  
    Total loans   $ 3,327,288     $ 3,236,039     $ 3,144,266     $ 3,087,488     $ 2,998,029  
                                   
    LOAN MIX                              
    Commercial and industrial     21.2%       20.1%       18.3%       17.7%       17.7%  
    Commercial real estate:                              
    Owner-occupied     21.3%       21.5%       21.4%       22.3%       22.3%  
    Investor     35.8%       35.9%       37.6%       37.9%       37.9%  
    Construction and development     4.8%       6.2%       6.5%       6.3%       6.3%  
    Multi-family     9.3%       9.5%       9.1%       8.7%       8.7%  
    Total commercial real estate     71.3%       73.1%       74.6%       75.2%       75.2%  
    Residential real estate:                              
    Residential mortgage and first lien home equity loans     4.8%       4.4%       4.6%       4.7%       4.7%  
    Home equity–second lien loans and revolving lines of credit     1.9%       1.6%       1.6%       1.6%       1.6%  
    Total residential real estate     6.7%       6.0%       6.2%       6.3%       6.3%  
    Consumer and other     0.9%       0.9%       1.0%       0.9%       0.9%  
    Net deferred loan fees and costs     (0.1%)       (0.1%)       (0.1%)       (0.1%)       (0.1%)  
    Total loans     100.0%       100.0%       100.0%       100.0%       100.0%  
                                             
    FIRST BANK
    QUARTERLY FINANCIAL HIGHLIGHTS
    (dollars in thousands, unaudited)
     
        As of the Quarter Ended
        6/30/2025   3/31/2025   12/31/2024   9/30/2024   6/30/2024
    DEPOSIT COMPOSITION                              
    Non-interest bearing demand deposits   $ 590,209     $ 535,584     $ 519,320     $ 519,079     $ 499,765  
    Interest bearing demand deposits     553,909       629,974       629,099       597,802       574,515  
    Money market and savings deposits     1,241,277       1,197,517       1,198,039       1,235,637       1,199,382  
    Time deposits     782,818       756,719       709,438       697,552       693,972  
    Total Deposits   $ 3,168,213     $ 3,119,794     $ 3,055,896     $ 3,050,070     $ 2,967,634  
                                   
    DEPOSIT MIX                              
    Non-interest bearing demand deposits     18.6%       17.2%       17.0%       17.0%       16.8%  
    Interest bearing demand deposits     17.5%       20.2%       20.6%       19.6%       19.4%  
    Money market and savings deposits     39.2%       38.4%       39.2%       40.5%       40.4%  
    Time deposits     24.7%       24.2%       23.2%       22.9%       23.4%  
    Total Deposits     100.0%       100.0%       100.0%       100.0%       100.0%  
                                             
    FIRST BANK
    NON-GAAP FINANCIAL MEASURES
    (in thousands, except for share data, unaudited)
     
        As of or For the Quarter Ended
        6/30/2025   3/31/2025   12/31/2024   9/30/2024   6/30/2024
    Return on Average Tangible Equity                              
    Net income (numerator)   $ 10,239     $ 9,381     $ 10,497     $ 8,162     $ 11,073  
                                   
    Average stockholders’ equity   $ 420,443     $ 413,672     $ 406,579     $ 398,535     $ 386,644  
    Less: Average Goodwill and other intangible assets, net     52,301       52,805       53,278       53,823       54,347  
    Average Tangible stockholders’ equity (denominator)   $ 368,142     $ 360,867     $ 353,301     $ 344,712     $ 332,297  
                                   
    Return on average tangible equity(1)     11.16%       10.54%       11.82%       9.42%       13.40%  
                                   
    Tangible Book Value Per Share                              
    Stockholders’ equity   $ 422,379     $ 414,915     $ 409,156     $ 402,070     $ 392,489  
    Less: Goodwill and other intangible assets, net     52,026       52,507       52,993       53,484       54,026  
    Tangible stockholders’ equity (numerator)   $ 370,353     $ 362,408     $ 356,163     $ 348,586     $ 338,463  
                                   
    Common shares outstanding (denominator)     24,905,790       25,045,612       25,100,829       25,186,920       25,144,983  
                                   
    Tangible book value per share   $ 14.87     $ 14.47     $ 14.19     $ 13.84     $ 13.46  
                                   
    Tangible Equity / Tangible Assets                              
    Stockholders’ equity   $ 422,379     $ 414,915     $ 409,156     $ 402,070     $ 392,489  
    Less: Goodwill and other intangible assets, net     52,026       52,507       52,993       53,484       54,026  
    Tangible stockholders’ equity (numerator)   $ 370,353     $ 362,408     $ 356,163     $ 348,586     $ 338,463  
                                   
    Total assets   $ 4,019,335     $ 3,880,759     $ 3,780,346     $ 3,757,653     $ 3,615,731  
    Less: Goodwill and other intangible assets, net     52,026       52,507       52,993       53,484       54,026  
    Tangible total assets (denominator)   $ 3,967,309     $ 3,828,252     $ 3,727,353     $ 3,704,169     $ 3,561,705  
                                   
    Tangible stockholders’ equity / tangible assets     9.34%       9.47%       9.56%       9.41%       9.50%  
                                   
    Efficiency Ratio                              
    Non-interest expense   $ 20,867     $ 20,384     $ 19,124     $ 18,644     $ 17,953  
    Less: Other real estate owned write-down     –       815       –       362       –  
    Adjusted non-interest expense (numerator)   $ 20,867     $ 19,569     $ 19,124     $ 18,282     $ 17,953  
                                   
    Net interest income   $ 34,009     $ 32,092     $ 31,594     $ 30,094     $ 30,540  
    Non-interest income     2,702       1,971       2,176       2,479       689  
    Total revenue     36,711       34,063       33,770       32,573       31,229  
    Add: Losses on sale of investment securities, net     –       –       –       555       –  
    (Subtract) Add: (Gains) losses on sale of loans, net     (75)       (29)       (38)       (135)       900  
    (Subtract): Gain on sale of other assets     (397)       –       –       –       –  
    Less: Bank Owned Life Insurance Incentive     –       (88)       (168)       (1,116)       –  
    Add: Executive Officer Severance Benefits     863       –       –       –       –  
    Adjusted total revenue (denominator)   $ 37,102     $ 33,946     $ 33,564     $ 31,877     $ 32,129  
                                   
    Efficiency ratio     56.24%       57.65%       56.98%       57.35%       55.88%  
                                   

    (1) Annualized.

    The MIL Network –

  • MIL-OSI: National Bank Holdings Corporation Announces Second Quarter 2025 Financial Results

    Source: GlobeNewswire (MIL-OSI)

    DENVER, July 22, 2025 (GLOBE NEWSWIRE) — National Bank Holdings Corporation (the “Company”) reported:

                                 
      For the quarter(1)   For the six months ended(1)
      2Q25   1Q25   2Q24   2025   2024
    Net income ($000’s) $ 34,022     $ 24,231     $ 26,135     $ 58,253     $ 57,526  
    Earnings per share – diluted $ 0.88     $ 0.63     $ 0.68     $ 1.51     $ 1.50  
    Return on average assets   1.38 %     0.99 %     1.06 %     1.19 %     1.17 %
    Return on average tangible assets(2)   1.49 %     1.09 %     1.17 %     1.29 %     1.28 %
    Return on average equity   10.15 %     7.42 %     8.46 %     8.80 %     9.37 %
    Return on average tangible common equity(2)   14.18 %     10.64 %     12.44 %     12.44 %     13.77 %

                                                          

    (1 )   Ratios are annualized.
    (2 )   See non-GAAP reconciliations below.
           

    In announcing these results, Chief Executive Officer Tim Laney shared, “We delivered quarterly earnings of $0.88 of earnings per diluted share and a return on average tangible common equity of 14.18%. Year-over-year fully taxable equivalent pre-provision net revenues grew by 19.9% highlighted by a strong net interest margin of 3.95%. We remain diligent in monitoring our loan book and maintaining a disciplined approach to extending credit, which resulted in just 5 basis points of annualized net charge-offs during the quarter.”

    Mr. Laney added, “Our solid results continue to generate meaningful capital growth with a Common Equity Tier 1 capital ratio of 14.2%. Our excess capital position provides us with optionality to act on a variety of growth opportunities. We are pleased with the recent launch of 2UniFi, an innovative financial ecosystem that we believe can change the way business owners and operators access the U.S. banking system. 2UniFi is built to empower business entrepreneurs with banking and business tools that save time, reduce stress, and help them grow their business.”

    Second Quarter 2025 Results
    (All comparisons refer to the first quarter of 2025, except as noted)

    Net income increased $9.8 million, or 40.4%, to $34.0 million or $0.88 per diluted share, compared to $24.2 million or $0.63 per diluted share. Fully taxable equivalent pre-provision net revenue increased $1.5 million, or 14.3% annualized, to $43.5 million. The return on average tangible assets increased 40 basis points to 1.49%, and the return on average tangible common equity increased 3.54% to 14.18%. Compared to the second quarter of 2024, fully taxable equivalent pre-provision net revenue increased $7.2 million or 19.9%.

    Net Interest Income
    Fully taxable equivalent net interest income increased $0.7 million to $89.3 million due to one additional day during the second quarter. The fully taxable equivalent net interest margin widened two basis points to 3.95%, driven by a three basis point increase in earning asset yields, partially offset by an increase in the cost of funds.

    Loans
    Loans totaled $7.5 billion at June 30, 2025, compared to $7.6 billion. We generated quarterly loan fundings of $322.7 million, led by commercial loan fundings of $219.6 million. The second quarter’s weighted average rate on new loans at the time of origination was 7.4%, compared to a weighted average yield of 6.5% on our loan portfolio.

    Asset Quality and Provision for Credit Losses
    The Company recorded no provision expense for credit losses, compared to $10.2 million in the previous quarter. Annualized net charge-offs totaled 0.05% of average total loans, compared to 0.80%. Non-performing loans totaled 0.45% of total loans at June 30, 2025, consistent with the previous quarter, and non-performing assets decreased one basis point to 0.45% of total loans and OREO at June 30, 2025. The allowance for credit losses as a percentage of loans increased one basis point to 1.19% at June 30, 2025.

    Deposits
    Average total deposits decreased $58.8 million to $8.2 billion during the second quarter 2025, and average transaction deposits (defined as total deposits less time deposits) decreased $85.3 million to $7.1 billion. The loan to deposit ratio totaled 90.5% at June 30, 2025, compared to 90.8%. The mix of transaction deposits to total deposits was 87.0% at June 30, 2025, compared to 87.4%.

    Non-Interest Income
    Non-interest income increased $1.7 million, or 11.0%, to $17.1 million during the second quarter. Income from partnership investments increased $0.6 million, bank card fees increased $0.5 million, SBA loan gains on sale increased $0.2 million, and the sales of two previously consolidated banking center properties drove a $1.3 million gain. Mortgage banking income decreased $0.8 million.

    Non-Interest Expense
    Non-interest expense totaled $62.9 million, compared to $62.0 million in the first quarter, which benefited from the $1.9 million payroll tax credits realized in the first quarter. Excluding the impact from the first quarter’s payroll tax credits, non-interest expense decreased $1.0 million due to our disciplined expense management. The second quarter’s non-interest expense includes $0.3 million of non-recurring restructuring charges as a result of expense reduction actions executed during the quarter. The fully taxable equivalent efficiency ratio improved 42 basis points to 57.3%, excluding other intangible assets amortization.

    Income tax expense totaled $7.5 million, compared to $5.6 million in the previous quarter, as a result of higher pre-tax income in the second quarter. The effective tax rate was 18.1%, compared to 18.8% in the first quarter.

    Capital
    Capital ratios continue to be well in excess of federal bank regulatory agency “well capitalized” thresholds. The tier 1 leverage ratio totaled 11.18%, and the common equity tier 1 capital ratio totaled 14.17% at June 30, 2025. Shareholders’ equity increased $23.2 million to $1.4 billion at June 30, 2025, primarily driven by $22.5 million of growth in retained earnings from net income after covering the quarter’s dividend, and a $4.1 million improvement in accumulated other comprehensive loss due to changes in the interest rate environment.

    Common book value per share increased $0.65 to $35.55 at June 30, 2025. Tangible common book value per share increased $0.70 to $26.64 driven by the quarter’s earnings after covering the quarterly dividend, and a $0.11 improvement in accumulated other comprehensive loss.

    Year-Over-Year Review
    (All comparisons refer to the first six months of 2024, except as noted)

    Net income increased $0.7 million to $58.3 million or $1.51 per diluted share, compared to $57.5 million or $1.50 per diluted share. Fully taxable equivalent pre-provision net revenue increased $8.6 million to $85.4 million. The return on average tangible assets increased one basis point to 1.29%, and the return on average tangible common equity was 12.44%, compared to 13.77%.

    Fully taxable equivalent net interest income increased $6.9 million to $177.9 million. The fully taxable equivalent net interest margin widened 17 basis points to 3.94%, driven by a 21 basis point decrease in the cost of funds, partially offset by a three basis point decrease in earning asset yields.

    Loans outstanding totaled $7.5 billion as of June 30, 2025, compared to $7.7 billion. New loan fundings over the trailing twelve months totaled $1.4 billion, led by commercial fundings of $928.3 million.

    The Company recorded $10.2 million of provision expense for credit losses, compared to $2.8 million in the same period prior year. Annualized net charge-offs totaled 0.43% of average total loans, compared to 0.11% net charge-offs in the same period prior year. Non-performing loans totaled 0.45% of total loans at June 30, 2025, compared to 0.34% in the prior year. Non-performing assets totaled 0.45% of total loans and OREO at June 30, 2025, compared to 0.36% in the prior year. The allowance for credit losses as a percentage of loans totaled 1.19% at June 30, 2025, compared to 1.25% at June 30, 2024.

    Average deposits totaled $8.2 billion, compared to $8.3 billion in the same period prior year, and average transaction deposits totaled $7.2 billion, compared to $7.3 billion in the same period prior year. The mix of transaction deposits to total deposits was 87.0% at June 30, 2025, compared to 87.8%.

    Non-interest income increased $0.7 million to $32.4 million primarily due to a $0.7 million increase in the gains on sales of previously consolidated banking center properties and a $0.4 million increase in trust income.

    Non-interest expense decreased $1.0 million to $124.9 million as a result of disciplined expense management and payroll tax credits realized during the first quarter 2025.

    Income tax expense totaled $13.1 million, consistent with the same period prior year. The effective tax rate was 18.4%, compared to 18.6% in the same period prior year.

    Conference Call
    Management will host a conference call to review the results at 11:00 a.m. Eastern Time on Wednesday, July 23, 2025. Interested parties may listen to this call by dialing (877) 400-0505 using the participant passcode of 9935135 and asking for the NBHC Q2 2025 Earnings Call. The earnings release and a link to the replay of the call will be available on the Company’s website at www.nationalbankholdings.com by visiting the investor relations area.

    About National Bank Holdings Corporation
    National Bank Holdings Corporation is a bank holding company created to build a leading community bank franchise, delivering high quality client service and committed to stakeholder results. Through its bank subsidiaries, NBH Bank and Bank of Jackson Hole Trust, National Bank Holdings Corporation operates a network of over 85 banking centers, serving individual consumers, small, medium and large businesses, and government and non-profit entities. Its banking centers are located in its core footprint of Colorado, the greater Kansas City region, Utah, Wyoming, Texas, New Mexico and Idaho. Its comprehensive residential mortgage banking group primarily serves the bank’s core footprint. Its trust and wealth management business is operated in its core footprint under the Bank of Jackson Hole Trust charter. NBH Bank operates under a single state charter through the following brand names as divisions of NBH Bank: in Colorado, Community Banks of Colorado and Community Banks Mortgage; in Kansas and Missouri, Bank Midwest and Bank Midwest Mortgage; in Texas, Utah, New Mexico and Idaho, Hillcrest Bank and Hillcrest Bank Mortgage; and in Wyoming, Bank of Jackson Hole and Bank of Jackson Hole Mortgage. Additional information about National Bank Holdings Corporation can be found at www.nationalbankholdings.com.

    For more information visit: cobnks.com, bankmw.com, hillcrestbank.com, bankofjacksonhole.com, or nbhbank.com, or connect with any of our brands on LinkedIn.

    About Non-GAAP Financial Measures
    Certain of the financial measures and ratios we present, including “tangible assets,” “return on average tangible assets,” “tangible common equity,” “return on average tangible common equity,” “tangible common book value per share,” “tangible common equity to tangible assets,” “non-interest expense excluding other intangible assets amortization,” “efficiency ratio excluding other intangible assets amortization,” “net income excluding the impact of other intangible assets amortization expense, after tax,” “pre-provision net revenue” and “fully taxable equivalent” metrics, are supplemental measures that are not required by, or are not presented in accordance with, U.S. generally accepted accounting principles (GAAP). We refer to these financial measures and ratios as “non-GAAP financial measures.” We consider the use of select non-GAAP financial measures and ratios to be useful for financial and operational decision making and useful in evaluating period-to-period comparisons. We believe that these non-GAAP financial measures provide meaningful supplemental information regarding our performance by excluding certain expenditures or assets that we believe are not indicative of our primary business operating results or by presenting certain metrics on a fully taxable equivalent basis. We believe that management and investors benefit from referring to these non-GAAP financial measures in assessing our performance and when planning, forecasting, analyzing and comparing past, present and future periods.

    These non-GAAP financial measures should not be considered a substitute for financial information presented in accordance with GAAP and you should not rely on non-GAAP financial measures alone as measures of our performance. The non-GAAP financial measures we present may differ from non-GAAP financial measures used by our peers or other companies. We compensate for these differences by providing the equivalent GAAP measures whenever we present the non-GAAP financial measures and by including a reconciliation of the impact of the components adjusted for in the non-GAAP financial measure so that both measures and the individual components may be considered when analyzing our performance. A reconciliation of non-GAAP financial measures to the comparable GAAP financial measures is included at the end of the financial statement tables.

    Forward-Looking Statements
    This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements do not discuss historical facts but instead relate to expectations, beliefs, plans, predictions, forecasts, objectives, assumptions or future events or performance. Forward-looking statements are generally identified by words such as “anticipate,” “believe,” “can,” “would,” “should,” “could,” “may,” “predict,” “seek,” “potential,” “will,” “estimate,” “target,” “plan,” “project,” “continuing,” “ongoing,” “expect,” “intend,” “goal,” “focus,” “maintains,” “future,” “ultimately,” “likely,” “ensure,” “strategy,” “objective,” and similar words or phrases. These statements are only predictions and involve estimates, known and unknown risks, assumptions and uncertainties. We have based these statements largely on our current expectations and projections about future events and financial trends that we believe may affect our financial condition, liquidity, results of operations, business strategy and growth prospects. Forward-looking statements involve certain important risks, uncertainties and other factors, any of which could cause actual results to differ materially from those in such statements and, therefore, you are cautioned not to place undue reliance on such statements. Factors that could cause actual results to differ from those discussed in the forward-looking statements include, but are not limited to: business and economic conditions along with external events both generally and in the financial services industry; susceptibility to credit risk and fluctuations in the value of real estate and other collateral securing a significant portion of our loan portfolio, including with regards to real estate acquired through foreclosure, and the accuracy of appraisals related to such real estate; the allowance for credit losses and fair value adjustments may be insufficient to absorb losses in our loan portfolio; our ability to maintain sufficient liquidity to meet the requirements of deposit withdrawals and other business needs; changes impacting monetary supply and the businesses of our clients and counterparties, including levels of market interest rates, inflation, currency values, monetary and fiscal policies, and the volatility of trading markets; changes in the fair value of our investment securities and the ability of companies in which we invest to commercialize their technology or product concepts; the loss of certain executive officers and key personnel; any service interruptions, cyber incidents or other breaches relating to our technology systems, security systems or infrastructure or those of our third-party providers; the occurrence of fraud or other financial crimes within our business; competition from other financial institutions and financial services providers and the effects of disintermediation within the banking business including consolidation within the industry; changes to federal government lending programs like the Small Business Administration’s Preferred Lender Program and the Federal Housing Administration’s insurance programs, including the impact of a government shutdown of such programs; impairment of our mortgage servicing rights, disruption in the secondary market for mortgage loans, declines in real estate values, or being required to repurchase mortgage loans or reimburse investors; developments in technology, such as artificial intelligence, the success of our digital growth strategy, and our ability to incorporate innovative technologies in our business and provide products and services that satisfy our clients’ expectations for convenience and security; our ability to execute our organic growth and acquisition strategies; the accuracy of projected operating results for assets and businesses we acquire as well as our ability to drive organic loan growth to replace loans in our existing portfolio with comparable loans as loans are paid down; changes to federal, state and local laws and regulations along with executive orders applicable to our business, including tax laws; our ability to comply with and manage costs related to extensive government regulation and supervision, including current and future regulations affecting bank holding companies and depository institutions; the application of any increased assessment rates imposed by the Federal Deposit Insurance Corporation (“FDIC”); claims or legal action brought against us by third parties or government agencies; and other factors, risks, trends and uncertainties described elsewhere in our other filings with the Securities and Exchange Commission (the “SEC”). The forward-looking statements are made as of the date of this press release, and we undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events or circumstances, except as required by applicable law.

    Contacts:
    Analysts/Institutional Investors:
    Emily Gooden, Chief Accounting Officer and Investor Relations Director, (720) 554-6640, ir@nationalbankholdings.com
    Nicole Van Denabeele, Chief Financial Officer, (720) 529-3370, ir@nationalbankholdings.com

    Media:
    Jody Soper, Chief Marketing Officer, (303) 784-5925, Jody.Soper@nbhbank.com

    NATIONAL BANK HOLDINGS CORPORATION
    FINANCIAL SUMMARY
    Consolidated Statements of Operations (Unaudited)
    (Dollars in thousands, except share and per share data)

                                           
      For the three months ended   For the six months ended
      June 30,   March 31,    June 30,    June 30,   June 30, 
      2025   2025   2024   2025   2024
    Total interest and dividend income $ 131,220     $ 129,963     $ 132,447     $ 261,183     $ 264,179  
    Total interest expense   43,811       43,272       48,873       87,083       96,575  
    Net interest income   87,409       86,691       83,574       174,100       167,604  
    Taxable equivalent adjustment   1,912       1,910       1,711       3,822       3,403  
    Net interest income FTE(1)   89,321       88,601       85,285       177,922       171,007  
    Provision expense for credit losses   —       10,200       2,776       10,200       2,776  
    Net interest income after provision for credit losses FTE(1)   89,321       78,401       82,509       167,722       168,231  
    Non-interest income:                                      
    Service charges   4,127       4,118       4,295       8,245       8,686  
    Bank card fees   4,732       4,194       4,882       8,926       9,460  
    Mortgage banking income   2,547       3,315       3,296       5,862       5,951  
    Other non-interest income   5,660       3,749       1,556       9,409       7,626  
    Total non-interest income   17,066       15,376       14,029       32,442       31,723  
    Non-interest expense:                                      
    Salaries and benefits   37,746       34,362       36,933       72,108       73,453  
    Occupancy and equipment   9,436       10,837       10,120       20,273       20,061  
    Professional fees   1,680       1,423       1,706       3,103       3,352  
    Data processing   4,452       4,401       4,117       8,853       8,183  
    Other non-interest expense   7,670       9,017       8,222       16,687       16,875  
    Other intangible assets amortization   1,947       1,977       1,977       3,924       3,985  
    Total non-interest expense   62,931       62,017       63,075       124,948       125,909  
                                           
    Income before income taxes FTE(1)   43,456       31,760       33,463       75,216       74,045  
    Taxable equivalent adjustment   1,912       1,910       1,711       3,822       3,403  
    Income before income taxes   41,544       29,850       31,752       71,394       70,642  
    Income tax expense   7,522       5,619       5,617       13,141       13,116  
    Net income $ 34,022     $ 24,231     $ 26,135     $ 58,253     $ 57,526  
    Earnings per share – basic $ 0.89     $ 0.63     $ 0.68     $ 1.52     $ 1.51  
    Earnings per share – diluted   0.88       0.63       0.68       1.51       1.50  
    Common stock dividend   0.30       0.29       0.28       0.59       0.55  

                                                          

         
    (1 )   Net interest income is presented on a GAAP basis and fully taxable equivalent (FTE) basis, as the Company believes this non-GAAP measure is the preferred industry measurement for this item. The FTE adjustment is for the tax benefit on certain tax exempt loans using the federal tax rate of 21% for each period presented.

    NATIONAL BANK HOLDINGS CORPORATION
    Consolidated Statements of Financial Condition (Unaudited)
    (Dollars in thousands, except share and per share data)

                           
      June 30, 2025   March 31, 2025   December 31, 2024   June 30, 2024
    ASSETS                      
    Cash and cash equivalents $ 296,483     $ 246,298     $ 127,848     $ 144,993  
    Investment securities available-for-sale   631,947       634,376       527,547       691,076  
    Investment securities held-to-maturity   717,232       706,912       533,108       554,686  
    Non-marketable securities   81,124       76,203       76,462       72,987  
    Loans   7,486,918       7,646,296       7,751,143       7,722,153  
    Allowance for credit losses   (88,893 )     (90,192 )     (94,455 )     (96,457 )
    Loans, net   7,398,025       7,556,104       7,656,688       7,625,696  
    Loans held for sale   20,784       11,885       24,495       18,787  
    Other real estate owned   291       615       662       1,526  
    Premises and equipment, net   209,414       204,567       196,773       177,456  
    Goodwill   306,043       306,043       306,043       306,043  
    Intangible assets, net   52,496       54,489       58,432       62,356  
    Other assets   284,890       301,378       299,635       315,245  
    Total assets $ 9,998,729     $ 10,098,870     $ 9,807,693     $ 9,970,851  
    LIABILITIES AND SHAREHOLDERS’ EQUITY                      
    Liabilities:                      
    Non-interest bearing demand deposits $ 2,168,574     $ 2,215,313     $ 2,213,685     $ 2,229,432  
    Interest bearing demand deposits   1,240,698       1,337,905       1,411,860       1,420,942  
    Savings and money market   3,785,951       3,812,312       3,592,312       3,703,810  
    Total transaction deposits   7,195,223       7,365,530       7,217,857       7,354,184  
    Time deposits   1,074,261       1,058,677       1,020,036       1,022,741  
    Total deposits   8,269,484       8,424,207       8,237,893       8,376,925  
    Securities sold under agreements to repurchase   18,513       20,749       18,895       19,465  
    Long-term debt   54,385       54,588       54,511       54,356  
    Federal Home Loan Bank advances   185,000       80,000       50,000       35,000  
    Other liabilities   118,851       190,018       141,319       237,461  
    Total liabilities   8,646,233       8,769,562       8,502,618       8,723,207  
    Shareholders’ equity:                      
    Common stock   515       515       515       515  
    Additional paid in capital   1,167,719       1,168,433       1,167,431       1,161,804  
    Retained earnings   544,428       521,939       508,864       469,630  
    Treasury stock   (304,254 )     (301,531 )     (301,694 )     (303,880 )
    Accumulated other comprehensive loss, net of tax   (55,912 )     (60,048 )     (70,041 )     (80,425 )
    Total shareholders’ equity   1,352,496       1,329,308       1,305,075       1,247,644  
    Total liabilities and shareholders’ equity $ 9,998,729     $ 10,098,870     $ 9,807,693     $ 9,970,851  
    SHARE DATA                      
    Average basic shares outstanding   38,075,896       38,068,455       38,327,964       38,210,869  
    Average diluted shares outstanding   38,151,810       38,229,869       38,565,164       38,372,777  
    Ending shares outstanding   38,045,622       38,094,105       38,054,482       37,899,453  
    Common book value per share $ 35.55     $ 34.90     $ 34.29     $ 32.92  
    Tangible common book value per share(1)(non-GAAP)   26.64       25.94       25.28       23.74  
    CAPITAL RATIOS                      
    Average equity to average assets   13.62 %     13.35 %     13.10 %     12.57 %
    Tangible common equity to tangible assets(1)   10.49 %     10.13 %     10.16 %     9.35 %
    Tier 1 leverage ratio   11.18 %     10.89 %     10.69 %     10.20 %
    Common equity tier 1 risk-based capital ratio   14.17 %     13.61 %     13.20 %     12.41 %
    Tier 1 risk-based capital ratio   14.17 %     13.61 %     13.20 %     12.41 %
    Total risk-based capital ratio   16.07 %     15.49 %     15.11 %     14.32 %

                                                          

    (1 )   Represents a non-GAAP financial measure. See non-GAAP reconciliations below.

    NATIONAL BANK HOLDINGS CORPORATION
    Loan Portfolio
    (Dollars in thousands)

    Period End Loan Balances by Type

                                   
              June 30, 2025       June 30, 2025
              vs. March 31, 2025       vs. June 30, 2024
      June 30, 2025   March 31, 2025   % Change   June 30, 2024   % Change
    Originated:                              
    Commercial:                              
    Commercial and industrial $ 1,829,984     $ 1,871,301       (2.2 )%   $ 1,906,095       (4.0 )%
    Municipal and non-profit   1,125,330       1,116,724       0.8 %     1,063,706       5.8 %
    Owner-occupied commercial real estate   1,051,964       1,026,692       2.5 %     921,122       14.2 %
    Food and agribusiness   213,254       251,120       (15.1 )%     248,401       (14.1 )%
    Total commercial   4,220,532       4,265,837       (1.1 )%     4,139,324       2.0 %
    Commercial real estate non-owner occupied   1,118,730       1,136,176       (1.5 )%     1,116,424       0.2 %
    Residential real estate   915,213       915,139       0.0 %     923,313       (0.9 )%
    Consumer   12,050       11,955       0.8 %     14,385       (16.2 )%
    Total originated   6,266,525       6,329,107       (1.0 )%     6,193,446       1.2 %
                                   
    Acquired:                              
    Commercial:                              
    Commercial and industrial   100,545       105,493       (4.7 )%     124,104       (19.0 )%
    Municipal and non-profit   265       271       (2.2 )%     288       (8.0 )%
    Owner-occupied commercial real estate   188,745       198,339       (4.8 )%     232,890       (19.0 )%
    Food and agribusiness   31,693       33,831       (6.3 )%     48,061       (34.1 )%
    Total commercial   321,248       337,934       (4.9 )%     405,343       (20.7 )%
    Commercial real estate non-owner occupied   601,890       659,680       (8.8 )%     752,040       (20.0 )%
    Residential real estate   296,795       318,510       (6.8 )%     369,003       (19.6 )%
    Consumer   460       1,065       (56.8 )%     2,321       (80.2 )%
    Total acquired   1,220,393       1,317,189       (7.3 )%     1,528,707       (20.2 )%
    Total loans $ 7,486,918     $ 7,646,296       (2.1 )%   $ 7,722,153       (3.0 )%

    Loan Fundings(1)

                                           
      Second quarter   First quarter   Fourth quarter   Third quarter   Second quarter
      2025   2025   2024   2024   2024
    Commercial:                                      
    Commercial and industrial $ 133,402     $ 108,594     $ 146,600     $ 93,711     $ 241,910  
    Municipal and non-profit   34,393       12,506       49,175       35,677       28,785  
    Owner occupied commercial real estate   47,233       37,762       117,850       70,517       102,615  
    Food and agribusiness   4,576       1,338       15,796       19,205       11,040  
    Total commercial   219,604       160,200       329,421       219,110       384,350  
    Commercial real estate non-owner occupied   56,770       65,254       119,132       91,809       83,184  
    Residential real estate   44,470       29,300       30,750       47,322       36,124  
    Consumer   1,823       970       726       1,010       1,547  
    Total $ 322,667     $ 255,724     $ 480,029     $ 359,251     $ 505,205  

                                                          

    (1 )   Loan fundings are defined as closed end funded loans and net fundings under revolving lines of credit. Net fundings under revolving lines of credit were $15,490, $21,752, $64,375, $16,302 and $19,281 for the periods noted in the table above, respectively.

    NATIONAL BANK HOLDINGS CORPORATION
    Summary of Net Interest Margin
    (Dollars in thousands)

                                                               
      For the three months ended   For the three months ended   For the three months ended
      June 30, 2025   March 31, 2025   June 30, 2024
      Average           Average   Average           Average   Average           Average
      balance   Interest   rate   balance   Interest   rate   balance   Interest   rate
    Interest earning assets:                                                          
    Originated loans FTE(1)(2) $ 6,289,154     $ 102,399       6.53 %   $ 6,335,931     $ 102,221       6.54 %   $ 6,074,199     $ 101,794       6.74 %
    Acquired loans   1,262,933       19,397       6.16 %     1,351,726       19,547       5.86 %     1,541,576       23,464       6.12 %
    Loans held for sale   21,115       354       6.72 %     19,756       349       7.16 %     16,862       318       7.59 %
    Investment securities available-for-sale   701,920       4,661       2.66 %     716,938       4,617       2.58 %     802,830       5,101       2.54 %
    Investment securities held-to-maturity   713,178       5,173       2.90 %     635,961       4,120       2.59 %     564,818       2,419       1.71 %
    Other securities   30,560       466       6.10 %     31,386       480       6.12 %     25,093       377       6.01 %
    Interest earning deposits   57,634       682       4.75 %     48,206       539       4.53 %     92,388       685       2.98 %
    Total interest earning assets FTE(2) $ 9,076,494     $ 133,132       5.88 %   $ 9,139,904     $ 131,873       5.85 %   $ 9,117,766     $ 134,158       5.92 %
    Cash and due from banks $ 79,131                   $ 77,237                   $ 100,165                
    Other assets   807,802                     794,374                     771,475                
    Allowance for credit losses   (90,292 )                   (95,492 )                   (97,741 )              
    Total assets $ 9,873,135                   $ 9,916,023                   $ 9,891,665                
    Interest bearing liabilities:                                                          
    Interest bearing demand, savings and money market deposits $ 4,986,119     $ 32,758       2.64 %   $ 5,027,052     $ 32,511       2.62 %   $ 5,109,924     $ 39,681       3.12 %
    Time deposits   1,062,481       9,087       3.43 %     1,035,983       8,756       3.43 %     1,015,371       8,536       3.38 %
    Federal Home Loan Bank advances   93,676       1,170       5.01 %     107,151       1,105       4.18 %     9,505       133       5.63 %
    Other borrowings(3)   41,300       278       2.70 %     50,277       382       3.08 %     17,449       5       0.12 %
    Long-term debt   54,574       518       3.81 %     54,539       518       3.85 %     54,307       518       3.84 %
    Total interest bearing liabilities $ 6,238,150     $ 43,811       2.82 %   $ 6,275,002     $ 43,272       2.80 %   $ 6,206,556     $ 48,873       3.17 %
    Demand deposits $ 2,152,899                   $ 2,197,300                   $ 2,254,454                
    Other liabilities   137,319                     119,806                     187,499                
    Total liabilities   8,528,368                     8,592,108                     8,648,509                
    Shareholders’ equity   1,344,767                     1,323,915                     1,243,156                
    Total liabilities and shareholders’ equity $ 9,873,135                   $ 9,916,023                   $ 9,891,665                
    Net interest income FTE(2)       $ 89,321                 $ 88,601                 $ 85,285        
    Interest rate spread FTE(2)                 3.06 %                   3.05 %                   2.75 %
    Net interest earning assets $ 2,838,344                   $ 2,864,902                   $ 2,911,210                
    Net interest margin FTE(2)                 3.95 %                   3.93 %                   3.76 %
    Average transaction deposits $ 7,139,018                   $ 7,224,352                   $ 7,364,378                
    Average total deposits   8,201,499                     8,260,335                     8,379,749                
    Ratio of average interest earning assets to average interest bearing liabilities   145.50 %                   145.66 %                   146.91 %              

                                                          

    (1 )   Originated loans are net of deferred loan fees, less costs, which are included in interest income over the life of the loan.
    (2 )   Presented on a fully taxable equivalent basis using the statutory tax rate of 21%. The tax equivalent adjustments included above are $1,912, $1,910 and $1,711 for the three months ended June 30, 2025, March 31, 2025 and June 30, 2024, respectively.
    (3 )   Other borrowings includes securities sold under agreements to repurchase and cash collateral received from counterparties in connection with derivative swap agreements.

    NATIONAL BANK HOLDINGS CORPORATION
    Summary of Net Interest Margin
    (Dollars in thousands)

                                       
      For the six months ended June 30, 2025   For the six months ended June 30, 2024
      Average           Average   Average           Average
      balance   Interest   rate   balance   Interest   rate
    Interest earning assets:                                  
    Originated loans FTE(1)(2) $ 6,312,413     $ 204,620       6.54 %   $ 6,060,524     $ 202,708       6.73 %
    Acquired loans   1,307,084       38,944       6.01 %     1,576,548       47,753       6.09 %
    Loans held for sale   20,439       703       6.94 %     14,440       543       7.56 %
    Investment securities available-for-sale   709,387       9,278       2.62 %     776,999       9,204       2.37 %
    Investment securities held-to-maturity   674,783       9,293       2.75 %     571,989       4,933       1.72 %
    Other securities   30,971       946       6.11 %     30,065       993       6.61 %
    Interest earning deposits   52,946       1,221       4.65 %     91,983       1,448       3.17 %
    Total interest earning assets FTE(2) $ 9,108,023     $ 265,005       5.87 %   $ 9,122,548     $ 267,582       5.90 %
    Cash and due from banks $ 78,189                 $ 101,374              
    Other assets   801,127                   763,853              
    Allowance for credit losses   (92,878 )                 (97,812 )            
    Total assets $ 9,894,461                 $ 9,889,963              
    Interest bearing liabilities:                                  
    Interest bearing demand, savings and money market deposits $ 5,006,472     $ 65,269       2.63 %   $ 5,028,868     $ 76,094       3.04 %
    Time deposits   1,049,305       17,843       3.43 %     1,002,706       16,120       3.23 %
    Federal Home Loan Bank advances   100,376       2,275       4.57 %     118,871       3,314       5.61 %
    Other borrowings(3)   45,764       660       2.91 %     18,189       11       0.12 %
    Long-term debt   54,557       1,036       3.83 %     54,268       1,036       3.84 %
    Total interest bearing liabilities $ 6,256,474     $ 87,083       2.81 %   $ 6,222,902     $ 96,575       3.12 %
    Demand deposits $ 2,174,977                 $ 2,267,725              
    Other liabilities   128,611                   164,617              
    Total liabilities   8,560,062                   8,655,244              
    Shareholders’ equity   1,334,399                   1,234,719              
    Total liabilities and shareholders’ equity $ 9,894,461                 $ 9,889,963              
    Net interest income FTE(2)       $ 177,922               $ 171,007      
    Interest rate spread FTE(2)                 3.06 %                   2.78 %
    Net interest earning assets $ 2,851,549                 $ 2,899,646              
    Net interest margin FTE(2)                 3.94 %                   3.77 %
    Average transaction deposits $ 7,181,449                 $ 7,296,593              
    Average total deposits   8,230,754                   8,299,299              
    Ratio of average interest earning assets to average interest bearing liabilities   145.58 %                 146.60 %            

                                                          

    (1 )   Originated loans are net of deferred loan fees, less costs, which are included in interest income over the life of the loan.
    (2 )   Presented on a fully taxable equivalent basis using the statutory tax rate of 21%. The tax equivalent adjustments included above are $3,822 and $3,403 for the six months ended June 30, 2025 and June 30, 2024, respectively.
    (3 )   Other borrowings includes securities sold under agreements to repurchase and cash collateral received from counterparties in connection with derivative swap agreements.

    NATIONAL BANK HOLDINGS CORPORATION
    Allowance for Credit Losses and Asset Quality
    (Dollars in thousands)

    Allowance for Credit Losses Analysis

                     
      As of and for the three months ended
      June 30, 2025   March 31, 2025   June 30, 2024
    Beginning allowance for credit losses $ 90,192     $ 94,455     $ 97,607  
    Charge-offs   (1,158 )     (15,251 )     (4,605 )
    Recoveries   170       138       499  
    Provision (release) expense for credit losses   (311 )     10,850       2,956  
    Ending allowance for credit losses (“ACL”) $ 88,893     $ 90,192     $ 96,457  
    Ratio of annualized net charge-offs to average total loans during the period   0.05 %     0.80 %     0.22 %
    Ratio of ACL to total loans outstanding at period end   1.19 %     1.18 %     1.25 %
    Ratio of ACL to total non-performing loans at period end   266.66 %     260.52 %     370.18 %
    Total loans $ 7,486,918     $ 7,646,296     $ 7,722,153  
    Average total loans during the period   7,530,783       7,660,974       7,582,506  
    Total non-performing loans   33,336       34,620       26,057  

    Past Due and Non-accrual Loans

                     
      June 30, 2025   March 31, 2025   June 30, 2024
    Loans 30-89 days past due and still accruing interest $ 13,923     $ 17,003     $ 27,159  
    Loans 90 days past due and still accruing interest   7,315       1,012       3,498  
    Non-accrual loans   33,336       34,620       26,057  
    Total past due and non-accrual loans $ 54,574     $ 52,635     $ 56,714  
    Total 90 days past due and still accruing interest and non-accrual loans to total loans   0.54 %     0.47 %     0.38 %

    Asset Quality Data

                     
      June 30, 2025   March 31, 2025   June 30, 2024
    Non-performing loans $ 33,336     $ 34,620     $ 26,057  
    OREO   291       615       1,526  
    Total non-performing assets $ 33,627     $ 35,235     $ 27,583  
    Total non-performing loans to total loans   0.45 %     0.45 %     0.34 %
    Total non-performing assets to total loans and OREO   0.45 %     0.46 %     0.36 %

    NATIONAL BANK HOLDINGS CORPORATION
    Key Metrics(1)

                                 
      As of and for the three months ended   As of and for the six months ended
      June 30,   March 31,    June 30,    June 30,   June 30, 
      2025   2025   2024   2025   2024
    Return on average assets   1.38 %     0.99 %     1.06 %     1.19 %     1.17 %
    Return on average tangible assets(2)   1.49 %     1.09 %     1.17 %     1.29 %     1.28 %
    Return on average equity   10.15 %     7.42 %     8.46 %     8.80 %     9.37 %
    Return on average tangible common equity(2)   14.18 %     10.64 %     12.44 %     12.44 %     13.77 %
    Loan to deposit ratio (end of period)   90.54 %     90.77 %     92.18 %     90.54 %     92.18 %
    Non-interest bearing deposits to total deposits (end of period)   26.22 %     26.30 %     26.61 %     26.22 %     26.61 %
    Net interest margin(3)   3.86 %     3.85 %     3.69 %     3.85 %     3.69 %
    Net interest margin FTE(2)(3)   3.95 %     3.93 %     3.76 %     3.94 %     3.77 %
    Interest rate spread FTE(2)(4)   3.06 %     3.05 %     2.75 %     3.06 %     2.78 %
    Yield on earning assets(5)   5.80 %     5.77 %     5.84 %     5.78 %     5.82 %
    Yield on earning assets FTE(2)(5)   5.88 %     5.85 %     5.92 %     5.87 %     5.90 %
    Cost of funds   2.09 %     2.07 %     2.32 %     2.08 %     2.29 %
    Cost of deposits   2.05 %     2.03 %     2.31 %     2.04 %     2.23 %
    Non-interest income to total revenue FTE(6)   16.04 %     14.79 %     14.13 %     15.42 %     15.65 %
    Efficiency ratio   60.24 %     60.76 %     64.62 %     60.50 %     63.17 %
    Efficiency ratio excluding other intangible assets amortization FTE(2)   57.32 %     57.74 %     61.52 %     57.53 %     60.14 %
    Pre-provision net revenue $ 41,544     $ 40,050     $ 34,528     $ 81,594     $ 73,418  
    Pre-provision net revenue FTE(2)   43,456       41,960       36,239       85,416       76,821  
                                 
    Total Loans Asset Quality Data(7)(8)                            
    Non-performing loans to total loans   0.45 %     0.45 %     0.34 %     0.45 %     0.34 %
    Non-performing assets to total loans and OREO   0.45 %     0.46 %     0.36 %     0.45 %     0.36 %
    Allowance for credit losses to total loans   1.19 %     1.18 %     1.25 %     1.19 %     1.25 %
    Allowance for credit losses to non-performing loans   266.66 %     260.52 %     370.18 %     266.66 %     370.18 %
    Net charge-offs to average loans   0.05 %     0.80 %     0.22 %     0.43 %     0.11 %

                                                          

    (1 )   Ratios are annualized.
    (2 )   Ratio represents non-GAAP financial measure. See non-GAAP reconciliations below.
    (3 )   Net interest margin represents net interest income, including accretion income on interest earning assets, as a percentage of average interest earning assets.
    (4 )   Interest rate spread represents the difference between the weighted average yield on interest earning assets, including FTE income, and the weighted average cost of interest bearing liabilities. Ratio represents a non-GAAP financial measure.
    (5 )   Interest earning assets include assets that earn interest/accretion or dividends. Any market value adjustments on investment securities or loans are excluded from interest earning assets.
    (6 )   Non-interest income to total revenue represents non-interest income divided by the sum of net interest income FTE and non-interest income. Ratio represents a non-GAAP financial measure.
    (7 )   Non-performing loans consist of non-accruing loans and modified loans on non-accrual.
    (8 )   Total loans are net of unearned discounts and fees.

    NATIONAL BANK HOLDINGS CORPORATION
    NON-GAAP FINANCIAL MEASURES AND RECONCILIATIONS
    (Dollars in thousands, except share and per share data)

    Tangible Common Book Value Ratios

                           
      June 30, 2025   March 31, 2025   December 31, 2024   June 30, 2024
    Total shareholders’ equity $ 1,352,496     $ 1,329,308     $ 1,305,075     $ 1,247,644  
    Less: goodwill and other intangible assets, net   (352,854 )     (354,800 )     (356,777 )     (360,732 )
    Add: deferred tax liability related to goodwill   13,741       13,638       13,535       12,871  
    Tangible common equity (non-GAAP) $ 1,013,383     $ 988,146     $ 961,833     $ 899,783  
                           
    Total assets $ 9,998,729     $ 10,098,870     $ 9,807,693     $ 9,970,851  
    Less: goodwill and other intangible assets, net   (352,854 )     (354,800 )     (356,777 )     (360,732 )
    Add: deferred tax liability related to goodwill   13,741       13,638       13,535       12,871  
    Tangible assets (non-GAAP) $ 9,659,616     $ 9,757,708     $ 9,464,451     $ 9,622,990  
                           
    Tangible common equity to tangible assets calculations:                      
    Total shareholders’ equity to total assets   13.53 %     13.16 %     13.31 %     12.51 %
    Less: impact of goodwill and other intangible assets, net   (3.04 )%     (3.03 )%     (3.15 )%     (3.16 )%
    Tangible common equity to tangible assets (non-GAAP)   10.49 %     10.13 %     10.16 %     9.35 %
                           
    Tangible common book value per share calculations:                      
    Tangible common equity (non-GAAP) $ 1,013,383     $ 988,146     $ 961,833     $ 899,783  
    Divided by: ending shares outstanding   38,045,622       38,094,105       38,054,482       37,899,453  
    Tangible common book value per share (non-GAAP) $ 26.64     $ 25.94     $ 25.28     $ 23.74  

    NATIONAL BANK HOLDINGS CORPORATION
    (Dollars in thousands, except share and per share data)
    Return on Average Tangible Assets and Return on Average Tangible Equity

                                 
      As of and for the three months ended   As of and for the six months ended
      June 30,   March 31,    June 30,    June 30,   June 30, 
      2025   2025   2024   2025   2024
    Net income $ 34,022     $ 24,231     $ 26,135     $ 58,253     $ 57,526  
    Add: impact of other intangible assets amortization expense, after tax   1,492       1,516       1,516       3,006       3,055  
    Net income excluding the impact of other intangible assets amortization expense, after tax (non-GAAP) $ 35,514     $ 25,747     $ 27,651     $ 61,259     $ 60,581  
                                 
    Average assets $ 9,873,135     $ 9,916,023     $ 9,891,665     $ 9,894,461     $ 9,889,963  
    Less: average goodwill and other intangible assets, net of deferred tax liability related to goodwill   (340,330 )     (342,425 )     (349,030 )     (341,320 )     (350,040 )
    Average tangible assets (non-GAAP) $ 9,532,805     $ 9,573,598     $ 9,542,635     $ 9,553,141     $ 9,539,923  
                                 
    Average shareholders’ equity $ 1,344,767     $ 1,323,915     $ 1,243,156     $ 1,334,399     $ 1,234,719  
    Less: average goodwill and other intangible assets, net of deferred tax liability related to goodwill   (340,330 )     (342,425 )     (349,030 )     (341,320 )     (350,040 )
    Average tangible common equity (non-GAAP) $ 1,004,437     $ 981,490     $ 894,126     $ 993,079     $ 884,679  
                                 
    Return on average assets   1.38 %     0.99 %     1.06 %     1.19 %     1.17 %
    Return on average tangible assets (non-GAAP)   1.49 %     1.09 %     1.17 %     1.29 %     1.28 %
    Return on average equity   10.15 %     7.42 %     8.46 %     8.80 %     9.37 %
    Return on average tangible common equity (non-GAAP)   14.18 %     10.64 %     12.44 %     12.44 %     13.77 %

    Fully Taxable Equivalent Yield on Earning Assets and Net Interest Margin

                                 
      As of and for the three months ended   As of and for the six months ended
      June 30,   March 31,    June 30,    June 30,   June 30, 
      2025   2025   2024   2025   2024
    Interest income $ 131,220     $ 129,963     $ 132,447     $ 261,183     $ 264,179  
    Add: impact of taxable equivalent adjustment   1,912       1,910       1,711       3,822       3,403  
    Interest income FTE (non-GAAP) $ 133,132     $ 131,873     $ 134,158     $ 265,005     $ 267,582  
                                 
    Net interest income $ 87,409     $ 86,691     $ 83,574     $ 174,100     $ 167,604  
    Add: impact of taxable equivalent adjustment   1,912       1,910       1,711       3,822       3,403  
    Net interest income FTE (non-GAAP) $ 89,321     $ 88,601     $ 85,285     $ 177,922     $ 171,007  
                                 
    Average earning assets $ 9,076,494     $ 9,139,904     $ 9,117,766     $ 9,108,023     $ 9,122,548  
    Yield on earning assets   5.80 %     5.77 %     5.84 %     5.78 %     5.82 %
    Yield on earning assets FTE (non-GAAP)   5.88 %     5.85 %     5.92 %     5.87 %     5.90 %
    Net interest margin   3.86 %     3.85 %     3.69 %     3.85 %     3.69 %
    Net interest margin FTE (non-GAAP)   3.95 %     3.93 %     3.76 %     3.94 %     3.77 %

    Efficiency Ratio and Pre-Provision Net Revenue

                                 
      As of and for the three months ended   As of and for the six months ended
      June 30,   March 31,    June 30,    June 30,   June 30, 
      2025   2025   2024   2025   2024
    Net interest income $ 87,409     $ 86,691     $ 83,574     $ 174,100     $ 167,604  
    Add: impact of taxable equivalent adjustment   1,912       1,910       1,711       3,822       3,403  
    Net interest income FTE (non-GAAP) $ 89,321     $ 88,601     $ 85,285     $ 177,922     $ 171,007  
                                 
    Non-interest income $ 17,066     $ 15,376     $ 14,029     $ 32,442     $ 31,723  
                                 
    Non-interest expense $ 62,931     $ 62,017     $ 63,075     $ 124,948     $ 125,909  
    Less: other intangible assets amortization   (1,947 )     (1,977 )     (1,977 )     (3,924 )     (3,985 )
    Non-interest expense excluding other intangible assets amortization (non-GAAP) $ 60,984     $ 60,040     $ 61,098     $ 121,024     $ 121,924  
                                 
    Efficiency ratio   60.24 %     60.76 %     64.62 %     60.50 %     63.17 %
    Efficiency ratio excluding other intangible assets amortization FTE (non-GAAP)   57.32 %     57.74 %     61.52 %     57.53 %     60.14 %
    Pre-provision net revenue (non-GAAP) $ 41,544     $ 40,050     $ 34,528     $ 81,594     $ 73,418  
    Pre-provision net revenue, FTE (non-GAAP)   43,456       41,960       36,239       85,416       76,821  

    The MIL Network –

  • MIL-OSI: Orrstown Financial Services, Inc. Reports Second Quarter 2025 Results and Announces Dividend Increase

    Source: GlobeNewswire (MIL-OSI)

    • Net income of $19.4 million, or $1.01 per diluted share, for the three months ended June 30, 2025 compared to net income of $18.1 million, or $0.93 per diluted share, for the three months ended March 31, 2025; the second quarter of 2025 included $1.0 million in merger-related expenses compared to $1.6 million in merger-related expenses for the first quarter of 2025;
    • Excluding the impact of the merger-related expenses referenced above, net of taxes, net income and diluted earnings per share were $20.2 million(1) and $1.04(1), respectively, for the second quarter of 2025 compared to $19.3 million(1) and $1.00(1), respectively, for the first quarter of 2025;
    • Net interest margin, on a tax equivalent basis, was 4.07% in the second quarter of 2025 compared to 4.00% in the first quarter of 2025; the net accretion of purchase accounting marks positively impacted the margin by 50 basis points in the second quarter of 2025;
    • Return on average assets was 1.45% and return on average equity was 14.56% for the three months ended June 30, 2025, compared to 1.35% and 13.98% for the return on average assets and return on average equity, respectively, for the three months ended March 31, 2025;
    • Excluding the impact of the merger-related expenses referenced above, net of taxes, adjusted return on average assets was 1.51%(1) and adjusted return on average equity was 15.12%(1) for the three months ended June 30, 2025 compared to 1.45%(1) and 14.97%(1), respectively, for the three months ended March 31, 2025;
    • Loans increased by $55.4 million, or 6% annualized, from March 31, 2025 to June 30, 2025; classified loans decreased by $10.4 million from $76.2 million at March 31, 2025 to $65.8 million at June 30, 2025;
    • Noninterest income increased by $1.3 million from $11.6 million for the three months ended March 31, 2025 to $12.9 million for the three months ended June 30, 2025;
    • Noninterest expense decreased by $0.6 million from $38.2 million for the three months ended March 31, 2025 to $37.6 million for the three months ended June 30, 2025, reflecting a decline in merger-related expenses during the second quarter of 2025; merger-related costs are not expected to be meaningful going forward; the second quarter of 2025 also included $0.6 million of severance charges in salaries and employee benefits expense;
    • Efficiency ratio decreased from 63.2% for the three months ended March 31, 2025 to 60.3% for the three months ended June 30, 2025; excluding the impact of the merger-related expenses, the efficiency ratio was 58.7%(1) for the three months ended June 30, 2025 compared to 60.5%(1) for the three months ended March 31, 2025;
    • Tangible common equity increased to 8.3% at June 30, 2025 compared to 7.9% at March 31, 2025;
    • Tangible book value per common share(1) increased to $22.77 per share at June 30, 2025 compared to $21.99 per share at March 31, 2025;
    • The Board of Directors authorized a share repurchase program on June 20, 2025, through which the Company could repurchase up to 500,000 shares of its common stock;
    • The Board of Directors declared a cash dividend of $0.27 per common share, payable August 12, 2025, to shareholders of record as of August 5, 2025; this represents a $0.01 per share increase in the Company’s quarter cash dividend; the dividend has increased by 35% since the closing of the merger with Codorus Valley Bancorp.

    (1) Non-GAAP measure. See Appendix A for additional information.

    HARRISBURG, Pa., July 22, 2025 (GLOBE NEWSWIRE) — Orrstown Financial Services, Inc. (NASDAQ: ORRF), the parent company of Orrstown Bank (the “Bank”), announced earnings for the periods ended June 30, 2025. Net income totaled $19.4 million for the three months ended June 30, 2025, compared to net income of $18.1 million for the three months ended March 31, 2025 and net income of $7.7 million for the three months ended June 30, 2024. Diluted earnings per share was $1.01 for the three months ended June 30, 2025, compared to diluted earnings per share of $0.93 for the three months ended March 31, 2025 and diluted earnings per share of $0.73 for the three months ended June 30, 2024. For the second quarter of 2025, excluding the impact of merger-related expenses, net of taxes, net income and diluted earnings per share were $20.2 million(1) and $1.04(1), respectively. For the first quarter of 2025, excluding the impact of merger-related expenses, net of taxes, net income and diluted earnings per share were $19.3 million(1) and $1.00(1), respectively. For the second quarter of 2024, excluding the impact of the merger-related expenses, net of taxes, net income and diluted earnings per share were $8.7 million(1) and $0.83(1), respectively.

    “At the one-year mark after the merger with Codorus Valley Bancorp, we are very pleased to have achieved metrics near top of peers, with significant upside opportunities in front of us,” said Thomas R. Quinn, Jr., President and Chief Executive Officer. “In the second quarter, we experienced positive traction on loan production. While commercial loan growth was lower than expected, our pipeline remains strong as we head into the third quarter. We remain prudent with our lending decisions and will not compromise on credit quality. Net interest margin improved in the quarter with good momentum going into the remainder of the year. While expenses remain slightly elevated, we do not anticipate any further meaningful merger-related expenses and continue to implement process improvements that will enhance efficiency and facilitate future growth. We believe that our strong credit metrics and capital generation have positioned us well for the future.”

    (1) Non-GAAP measure. See Appendix A for additional information.


    DISCUSSION OF RESULTS

    Balance Sheet

    Loans

    Loans held for investment increased by $55.4 million and totaled $3.9 billion at both June 30, 2025 and March 31, 2025. Commercial loans increased by $16.1 million, or 2% annualized, and residential mortgages increased by $37.9 million from March 31, 2025 to June 30, 2025. The increase in loans included a purchase of property assessed clean energy (“PACE”) loans totaling $25.4 million.

    Investment Securities

    Investment securities, all of which are classified as available-for-sale, increased by $29.9 million to $885.4 million at June 30, 2025 from $855.5 million at March 31, 2025. During the second quarter of 2025, the Bank purchased $50.1 million of investment securities, which was partially offset by paydowns totaling $20.4 million. The overall duration of the Company’s investment securities portfolio was 4.5 years at June 30, 2025 compared to 4.3 years at March 31, 2025. See Appendix B for a summary of the Bank’s investment securities at June 30, 2025, highlighting their concentrations, credit ratings and credit enhancement levels.

    Deposits

    During the second quarter of 2025, deposits decreased by $117.1 million and totaled $4.5 billion at June 30, 2025 compared to $4.6 billion March 31, 2025. Time deposits, money market deposits, non-interest bearing demand deposits, saving deposits and interest-bearing demand deposits decreased by $58.0 million, $35.8 million, $13.9 million, $6.2 million and $3.2 million, respectively, from March 31, 2025 to June 30, 2025. The declines in time deposits and money market deposits are due to continued run-off in higher yielding promotional balances. The decreases in the other categories were consistent with normal cyclical activity. As a result of the decrease in total deposits, the Bank’s loan-to-deposit ratio increased to 87% at June 30, 2025 from 84% at March 31, 2025.

    Borrowings

    The Bank actively manages its liquidity position through its various sources of funding to meet the needs of its clients. FHLB advances and other borrowings were $136.3 million at June 30, 2025 compared to $100.3 million at March 31, 2025. The increase was due to higher utilization of overnight borrowings during the second quarter of 2025 as deposit balances declined and lending and investing activities increased. The Bank seeks to maintain sufficient liquidity to ensure client needs can be addressed in a timely basis. The Bank had available alternative funding sources, such as FHLB advances and other wholesale options, of approximately $1.7 billion at June 30, 2025.

    Income Statement

    Net Interest Income and Margin

    Net interest income was $49.5 million for the three months ended June 30, 2025 compared to $48.8 million for the three months ended March 31, 2025. The net interest margin, on a tax equivalent basis, increased to 4.07% in the second quarter of 2025 from 4.00% in the first quarter of 2025. This increase is primarily the result of the cost of funds declining by 12 basis points from the first quarter of 2025 to the second quarter of 2025. This was partially offset by a decrease of seven basis points in the yield on loans from the three months ended March 31, 2025 to the three months ended June 30, 2025. This decrease was due to a reduction in accelerated accretion on acquired loans over that period. The second quarter 2025 net interest margin reflects the full impact of deposit rate reductions implemented in the prior quarter as well as the runoff of higher rate time deposits and money market balances.

    The net interest margin was positively impacted by the net accretion impact of purchase accounting marks on loans, securities, deposits and borrowings of $5.2 million during the second quarter of 2025 compared to $6.9 million for the first quarter of 2025. This change was due primarily to lower accelerated accretion in the three months ended June 30, 2025.

    Interest income on loans, on a tax equivalent basis, decreased by $0.4 million to $63.2 million for the three months ended June 30, 2025 compared to $63.6 million for the three months ended March 31, 2025. Average loans decreased by $14.7 million during the three months ended June 30, 2025 compared to the three months ended March 31, 2025. The accretion of purchase accounting marks on loans totaled $4.9 million during the second quarter of 2025 compared to $6.6 million during the first quarter of 2025.

    Interest income on investment securities, on a tax equivalent basis, was $10.6 million for the second quarter of 2025 compared to $10.1 million in the first quarter of 2025, an increase of $0.5 million. Average investment securities increased by $39.0 million during the three months ended June 30, 2025 compared to the three months ended March 31, 2025 primarily due to the aforementioned purchases.

    Interest expense, on a tax equivalent basis, decreased by $1.5 million to $25.3 million for the three months ended June 30, 2025 compared to $26.8 million for the three months ended March 31, 2025. Average interest-bearing deposits decreased by $70.3 million during the three months ended June 30, 2025 compared to the three months ended March 31, 2025. The cost of interest-bearing deposits declined by 14 basis points from the first quarter of 2025 to the second quarter of 2025. In addition, interest expense includes $0.4 million and $0.6 million of amortization of purchase accounting marks on interest bearing liabilities for the three months ended June 30, 2025 and March 31, 2025, respectively.

    Provision for Credit Losses on Loans

    The allowance for credit losses (“ACL”) on loans increased to $47.9 million at June 30, 2025 from $47.8 million at March 31, 2025. The ACL to total loans was 1.22% at June 30, 2025 compared to 1.23% at March 31, 2025. The Company recorded provision expense of $0.2 million for the three months ended June 30, 2025 compared to a recovery in the provision for credit losses on loans of $0.6 million for the three months ended March 31, 2025 . Net charge-offs were $0.1 million for the three months ended June 30, 2025 compared to $0.3 million for the three months ended March 31, 2025.

    Classified loans decreased by $10.4 million to $65.8 million at June 30, 2025 from $76.2 million at March 31, 2025 due to net upgrades and loan repayments. Non-accrual loans totaled $22.4 million at June 30, 2025 compared to $22.7 million at March 31, 2025. Nonaccrual loans to total loans decreased to 0.57% at June 30, 2025 compared to 0.59% at March 31, 2025. Management believes the ACL to be adequate based on current asset quality metrics and economic forecasts.

    Noninterest Income

    Noninterest income increased by $1.3 million to $12.9 million for the three months ended June 30, 2025 from $11.6 million for the three months ended March 31, 2025.

    Swap fee income increased by $0.3 million to $0.7 million for the three months ended June 30, 2025 compared to $0.4 million for the three months ended March 31, 2025. Swap fee income will fluctuate based on market conditions and client demand.

    Income from service charges was $2.6 million for the three months ended June 30, 2025 compared to $2.4 million for the three months ended March 31, 2025 based on increased cash management services activity.

    Income from mortgage banking activities increased by $0.2 million from $0.3 million in the three months ended March 31, 2025 to $0.5 million in the three months ended June 30, 2025. The first quarter of 2025 included a decrease of $0.2 million in the fair value of mortgage servicing rights.

    Wealth management income decreased by $0.2 million to $5.2 million for the three months ended June 30, 2025 compared to $5.4 million for the three months ended March 31, 2025.

    Other income increased by $0.7 million to $2.4 million for the three months ended June 30, 2025 compared to $1.7 million for the three months ended March 31, 2025. During the second quarter of 2025, the Bank recorded $0.3 million in solar tax credits and a gain on the sale of other real estate owned of $0.1 million.

    Noninterest Expenses

    Noninterest expenses decreased by $0.6 million to $37.6 million in the three months ended June 30, 2025 from $38.2 million in the three months ended March 31, 2025.

    For the three months ended June 30, 2025, merger-related expenses totaled $1.0 million, a decrease of $0.6 million, compared to $1.6 million for the three months ended March 31, 2025. The merger-related costs incurred in the second quarter of 2025 primarily included software conversion costs. The Company does not expect to incur meaningful merger-related expenses going forward.

    Salaries and benefits expense increased by $1.0 million to $21.4 million for the three months ended June 30, 2025 compared to $20.4 million for the three months ended March 31, 2025. The increase during the second quarter of 2025 includes $0.6 million of severance costs, the impact of merit salary increases in May and the impact of one extra day in the quarter.

    Occupancy, furniture and equipment expenses decreased by $0.5 million to $4.2 million for the three months ended June 30, 2025 from $4.7 million for the three months ended March 31, 2025 primarily due to the seasonal expenses incurred during the first quarter of 2025.

    Professional services expense increased by $0.2 million from the three months ended March 31, 2025 to the three months ended June 30, 2025. During the quarter, the Company continued to utilize an elevated level of third-party assistance to enhance daily functions and operational processes throughout the organization. While the Company will remain reliant on these services into the second half of 2025, the Company expects expenses related to these services to decline beginning in the third quarter of 2025.

    Advertising and bank promotions expense increased by $0.6 million to $1.1 million in the three months ended June 30, 2025 from $0.5 million in the three months ended March 31, 2025 due to $0.7 million in contributions to tax credit programs during the second quarter of 2025. Taxes other than income decreased by $0.6 million in the three months ended June 30, 2025 compared to the three months ended March 31, 2025. This decrease reflects the tax impact of the contributions referenced above.

    Income Taxes

    The Company’s effective tax rate was 21.3% for the second quarter of 2025 compared to 20.7% for the first quarter of 2025. The Company’s effective tax rate for the three months ended June 30, 2025 is greater than the 21% federal statutory rate primarily due to the disallowed portion of interest expense against earnings in association with the Bank’s tax-exempt investments under the Tax Equity and Fiscal Responsibility Act of 1982 partially offset by the benefit of tax-exempt income, including interest earned on tax-exempt loans and securities and income from life insurance policies and tax credits. The Company regularly analyzes its projected taxable income and makes adjustments to the provision for income taxes accordingly.

    Capital

    Shareholders’ equity totaled $548.4 million at June 30, 2025 compared to $532.9 million at March 31, 2025. The increase is due to net income of $19.4 million and share-based compensation activity of $1.6 million, partially offset by dividend payments of $5.1 million and other comprehensive losses of $0.5 million.

    Tangible book value per common share(1) increased to $22.77 per share at June 30, 2025 from $21.99 per share at March 31, 2025. The Company’s tangible common equity ratio was 8.3% at June 30, 2025 compared to 7.9% at March 31, 2025. Average tangible common equity per common share(1) was $18.43 at June 30, 2025 compared to $17.91 at March 31, 2025.

    The Company’s capital ratios increased during the three months ended June 30, 2025 due primarily to earnings. The Company’s tier 1 common equity, tier 1 and total risk-based capital ratios were 10.9%, 11.1% and 13.3%, respectively, at June 30, 2025 compared to 10.6%, 10.8% and 13.1%, respectively, at March 31, 2025. The Company’s Tier 1 leverage ratio increased to 9.0% at June 30, 2025 compared to 8.6% at March 31, 2025.

    At June 30, 2025, all four capital ratios applicable to the Company were above regulatory minimum levels to be deemed “well capitalized” under current bank regulatory guidelines. The Company continues to believe that capital is adequate to support the risks inherent in the balance sheet, as well as growth requirements.

    The Board of Directors authorized a share repurchase program on June 20, 2025, through which the Company could repurchase up to 500,000 shares of its common stock. The Company repurchased 2,134 common shares during the second quarter of 2025.

    (1) Non-GAAP measure. See Appendix A for additional information.


    Investor Relations Contact:
    Neelesh Kalani
    Executive Vice President, Chief Financial Officer
    Phone (717) 510-7097

    FINANCIAL HIGHLIGHTS (Unaudited)    		              
                   
                   
      Three Months Ended   Six Months Ended
      June 30,   June 30,   June 30,   June 30,
    (In thousands)   2025       2024       2025       2024  
                   
    Profitability for the period:              
    Net interest income $ 49,512     $ 26,103     $ 98,273     $ 52,984  
    Provision for (Recovery of) credit losses – loans   209       812       (345 )     1,233  
    Recovery of credit losses – unfunded loan commitments   (100 )     —       (100 )     (123 )
    Noninterest income   12,915       7,172       24,539       13,802  
    Noninterest expenses   37,614       22,639       75,790       45,108  
    Income before income tax expense   24,704       9,824       47,467       20,568  
    Income tax expense   5,256       2,086       9,968       4,299  
    Net income available to common shareholders $ 19,448     $ 7,738     $ 37,499     $ 16,269  
                   
    Financial ratios:              
    Return on average assets (1)   1.45 %     0.97 %     1.40 %     1.04 %
    Return on average assets, adjusted (1) (2) (3)   1.51 %     1.09 %     1.48 %     1.14 %
    Return on average equity (1)   14.56 %     11.41 %     14.28 %     12.09 %
    Return on average equity, adjusted (1) (2) (3)   15.12 %     12.88 %     15.05 %     13.33 %
    Net interest margin (1)   4.07 %     3.54 %     4.04 %     3.65 %
    Efficiency ratio   60.3 %     68.0 %     61.7 %     67.5 %
    Efficiency ratio, adjusted (2) (3)   58.7 %     64.6 %     59.6 %     64.8 %
    Income per common share:              
    Basic $ 1.01     $ 0.74     $ 1.96     $ 1.57  
    Basic, adjusted (2) (3) $ 1.05     $ 0.84     $ 2.06     $ 1.73  
    Diluted $ 1.01     $ 0.73     $ 1.94     $ 1.55  
    Diluted, adjusted (2) (3) $ 1.04     $ 0.83     $ 2.04     $ 1.71  
                   
    Average equity to average assets   9.97 %     8.50 %     9.81 %     8.58 %
                   
    (1) Annualized for the three and six months ended June 30, 2025 and 2024.
    (2) Ratio has been adjusted for the non-recurring charges for all periods presented.
    (3) Non-GAAP based financial measure. Please refer to Appendix A – Supplemental Reporting of Non-GAAP Measures and GAAP to Non-GAAP Reconciliations for a discussion of our use of non-GAAP based financial measures, including tables reconciling GAAP and non-GAAP financial measures appearing herein.
    FINANCIAL HIGHLIGHTS (Unaudited)      
    (continued)      
      June 30,   December 31,
    (Dollars in thousands, except per share amounts)   2025       2024  
    At period-end:      
    Total assets $ 5,387,645     $ 5,441,589  
    Loans, net of allowance for credit losses   3,883,481       3,882,525  
    Loans held-for-sale, at fair value   5,206       6,614  
    Securities available for sale, at fair value   885,373       829,711  
    Total deposits   4,516,625       4,623,096  
    FHLB advances and other borrowings and Securities sold under agreements to repurchase   166,381       141,227  
    Subordinated notes and trust preferred debt   69,021       68,680  
    Shareholders’ equity   548,448       516,682  
           
    Credit quality and capital ratios (1):      
    Allowance for credit losses to total loans   1.22 %     1.24 %
    Total nonaccrual loans to total loans   0.57 %     0.61 %
    Nonperforming assets to total assets   0.42 %     0.45 %
    Allowance for credit losses to nonaccrual loans   214 %     202 %
    Total risk-based capital:      
    Orrstown Financial Services, Inc.   13.3 %     12.4 %
    Orrstown Bank   13.3 %     12.4 %
    Tier 1 risk-based capital:      
    Orrstown Financial Services, Inc.   11.1 %     10.2 %
    Orrstown Bank   12.1 %     11.2 %
    Tier 1 common equity risk-based capital:      
    Orrstown Financial Services, Inc.   10.9 %     10.0 %
    Orrstown Bank   12.1 %     11.2 %
    Tier 1 leverage capital:      
    Orrstown Financial Services, Inc.   9.0 %     8.3 %
    Orrstown Bank   9.8 %     9.1 %
           
    Book value per common share $ 28.07     $ 26.65  
           
    (1) Capital ratios are estimated for the current period, subject to regulatory filings. The Company elected the three-year phase in option for the day-one impact of ASU 2016-13 for current expected credit losses (“CECL”) to regulatory capital. Beginning in 2023, the Company adjusted retained earnings, allowance for credit losses includable in tier 2 capital and the deferred tax assets from temporary differences in risk weighted assets by the permitted percentage of the day-one impact from adopting the CECL standard.
    ORRSTOWN FINANCIAL SERVICES, INC.      
    CONSOLIDATED BALANCE SHEETS (Unaudited)      
           
    (Dollars in thousands, except per share amounts) June 30, 2025   December 31, 2024
    Assets      
    Cash and due from banks $ 54,335     $ 51,026  
    Interest-bearing deposits with banks   95,042       197,848  
    Cash and cash equivalents   149,377       248,874  
    Restricted investments in bank stocks   21,204       20,232  
    Securities available for sale (amortized cost of $916,830 and $864,920 at June 30, 2025 and December 31, 2024, respectively)   885,373       829,711  
    Loans held for sale, at fair value   5,206       6,614  
    Loans   3,931,379       3,931,214  
    Less: Allowance for credit losses   (47,898 )     (48,689 )
    Net loans   3,883,481       3,882,525  
    Premises and equipment, net   51,703       50,217  
    Cash surrender value of life insurance   145,760       143,854  
    Goodwill   69,751       68,106  
    Other intangible assets, net   42,748       47,765  
    Accrued interest receivable   19,958       21,058  
    Deferred tax assets, net   36,683       42,647  
    Other assets   76,401       79,986  
    Total assets $ 5,387,645     $ 5,441,589  
           
    Liabilities      
    Deposits:      
    Noninterest-bearing $ 918,263     $ 894,176  
    Interest-bearing   3,598,362       3,728,920  
    Total deposits   4,516,625       4,623,096  
    Securities sold under agreements to repurchase and federal funds purchased   30,047       25,863  
    FHLB advances and other borrowings   136,334       115,364  
    Subordinated notes and trust preferred debt   69,021       68,680  
    Other liabilities   87,170       91,904  
    Total liabilities   4,839,197       4,924,907  
           
    Shareholders’ Equity      
    Preferred stock, $1.25 par value per share; 500,000 shares authorized; no shares issued or outstanding   —       —  
    Common stock, no par value—$0.05205 stated value per share; 50,000,000 shares authorized; 19,713,126 shares issued and 19,535,835 outstanding at June 30, 2025; 19,722,640 shares issued and 19,389,967 outstanding at December 31, 2024   1,026       1,027  
    Additional paid—in capital   422,349       423,274  
    Retained earnings   153,923       126,540  
    Accumulated other comprehensive loss   (24,479 )     (26,316 )
    Treasury stock— 177,291 and 332,673 shares, at cost at June 30, 2025 and December 31, 2024, respectively   (4,371 )     (7,843 )
    Total shareholders’ equity   548,448       516,682  
    Total liabilities and shareholders’ equity $ 5,387,645     $ 5,441,589  

    ORRSTOWN FINANCIAL SERVICES, INC.
    CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
                     
        Three Months Ended   Six Months Ended
        June 30,   June 30,   June 30,   June 30,
    (Dollars in thousands, except per share amounts)     2025       2024       2025       2024  
    Interest income                
    Loans   $ 63,036     $ 35,537     $ 126,468     $ 71,770  
    Investment securities – taxable     9,406       4,999       18,350       9,583  
    Investment securities – tax-exempt     878       881       1,753       1,758  
    Short-term investments     1,513       1,864       3,781       2,820  
    Total interest income     74,833       43,281       150,352       85,931  
    Interest expense                
    Deposits     22,855       15,265       47,115       28,781  
    Securities sold under agreements to repurchase and federal funds purchased     106       27       190       52  
    FHLB advances and other borrowings     1,030       1,152       2,148       2,626  
    Subordinated notes and trust preferred debt     1,330       734       2,626       1,488  
    Total interest expense     25,321       17,178       52,079       32,947  
    Net interest income     49,512       26,103       98,273       52,984  
    Provision for (Recovery of) credit losses – loans     209       812       (345 )     1,233  
    Recovery of credit losses – unfunded loan commitments     (100 )     —       (100 )     (123 )
    Net interest income after provision for (recovery of) credit losses     49,403       25,291       98,718       51,874  
    Noninterest income                
    Service charges     2,630       1,283       5,025       2,483  
    Interchange income     1,441       961       2,868       1,872  
    Swap fee income     669       375       1,063       574  
    Wealth management income     5,267       3,312       10,682       6,414  
    Mortgage banking activities     478       369       780       827  
    Investment securities gains (losses)     8       (12 )     21       (17 )
    Other income     2,422       884       4,100       1,649  
    Total noninterest income     12,915       7,172       24,539       13,802  
    Noninterest expenses                
    Salaries and employee benefits     21,364       13,195       41,752       26,947  
    Occupancy, furniture and equipment     4,211       2,705       8,886       5,344  
    Data processing     965       1,237       1,889       2,502  
    Advertising and bank promotions     1,077       774       1,576       1,172  
    FDIC insurance     674       419       1,498       860  
    Professional services     2,016       801       3,842       1,432  
    Taxes other than income     295       49       1,237       543  
    Intangible asset amortization     2,472       215       5,007       440  
    Merger-related expenses     968       1,135       2,617       1,807  
    Restructuring expenses     —       —       91       —  
    Other operating expenses     3,572       2,109       7,395       4,061  
    Total noninterest expenses     37,614       22,639       75,790       45,108  
    Income before income tax expense     24,704       9,824       47,467       20,568  
    Income tax expense     5,256       2,086       9,968       4,299  
    Net income   $ 19,448     $ 7,738     $ 37,499     $ 16,269  
     
        Three Months Ended   Six Months Ended
        June 30,   June 30,   June 30,   June 30,
          2025       2024       2025       2024  
    Share information:                
    Basic earnings per share   $ 1.01     $ 0.74     $ 1.96     $ 1.57  
    Diluted earnings per share   $ 1.01     $ 0.73     $ 1.94     $ 1.55  
    Dividends paid per share   $ 0.26     $ 0.20     $ 0.52     $ 0.40  
    Weighted average shares – basic     19,173       10,393       19,165       10,371  
    Weighted average shares – diluted     19,342       10,553       19,335       10,517  

    ANALYSIS OF NET INTEREST INCOME    		        
    Average Balances and Interest Rates, Taxable-Equivalent Basis (Unaudited)    
      Three Months Ended
      6/30/2025   3/31/2025   12/31/2024   9/30/2024   6/30/2024
    (In thousands)     Taxable-   Taxable-       Taxable-   Taxable-       Taxable-   Taxable-       Taxable-   Taxable-       Taxable-   Taxable-
    Average   Equivalent   Equivalent   Average   Equivalent   Equivalent   Average   Equivalent   Equivalent   Average   Equivalent   Equivalent   Average   Equivalent   Equivalent
    Balance   Interest   Rate   Balance   Interest   Rate   Balance   Interest   Rate   Balance   Interest   Rate   Balance   Interest   Rate
    Assets                                                          
    Federal funds sold & interest-bearing bank balances $ 136,106   $ 1,513     4.46%   $ 203,347   $ 2,268     4.52%   $ 199,236   $ 2,492     4.96%   $ 184,465   $ 2,452     5.29%   $ 142,868   $ 1,864     5.25%
    Investment securities (1)(2)   904,119     10,626     4.70     865,126     10,052     4.65     849,389     9,887     4.66     849,700     10,123     4.77     538,451     6,114     4.54
    Loans (1)(3)(4)(5)   3,894,979     63,246     6.52     3,909,694     63,641     6.59     3,961,269     68,073     6.82     3,989,259     70,849     7.07     2,324,942     35,690     6.17
    Total interest-earning assets   4,935,203     75,385     6.13     4,978,167     75,961     6.17     5,009,894     80,452     6.38     5,023,424     83,424     6.61     3,006,261     43,668     5.84
    Other assets   439,569             447,530             454,271             491,719             204,863        
    Total assets $ 5,374,772           $ 5,425,697           $ 5,464,165           $ 5,515,143           $ 3,211,124        
    Liabilities and Shareholders’ Equity                                                
    Interest-bearing demand deposits $ 2,463,687     13,880     2.26   $ 2,473,543     14,156     2.32   $ 2,522,885     15,575     2.45   $ 2,554,743     16,165     2.52   $ 1,649,753     10,118     2.47
    Savings deposits   269,309     165     0.25     273,313     165     0.25     272,718     166     0.24     283,337     148     0.21     165,467     140     0.34
    Time deposits   914,108     8,810     3.87     970,588     9,939     4.15     998,963     11,109     4.41     1,014,628     12,290     4.82     481,721     5,007     4.18
    Total interest-bearing deposits   3,647,104     22,855     2.51     3,717,444     24,260     2.65     3,794,566     26,850     2.81     3,852,708     28,603     2.95     2,296,941     15,265     2.67
    Securities sold under agreements to repurchase and federal funds purchased   25,917     106     1.64     26,163     84     1.30     21,572     67     1.23     23,075     96     1.66     13,412     27     0.81
    FHLB advances and other borrowings   104,068     1,030     3.97     112,859     1,118     4.02     115,373     1,165     4.01     115,388     1,154     3.98     115,000     1,152     4.03
    Subordinated notes and trust preferred debt   68,910     1,330     7.74     68,739     1,296     7.65     68,571     1,360     7.88     68,399     1,437     8.36     32,118     734     9.19
    Total interest-bearing liabilities   3,845,999     25,321     2.64     3,925,205     26,758     2.76     4,000,082     29,442     2.92     4,059,570     31,290     3.07     2,457,471     17,178     2.81
    Noninterest-bearing demand deposits   904,031             887,726             849,999             807,886             423,037        
    Other liabilities   89,058             89,077             97,685             110,017             57,828        
    Total liabilities   4,839,088             4,902,008             4,947,766             4,977,473             2,938,336        
    Shareholders’ equity   535,684             523,689             516,399             537,670             272,788        
    Total $ 5,374,772           $ 5,425,697           $ 5,464,165           $ 5,515,143           $ 3,211,124        
    Taxable-equivalent net interest income / net interest spread       50,064     3.49%         49,203     3.41%         51,010     3.46%         52,134     3.55%         26,490     3.02%
    Taxable-equivalent net interest margin         4.07%           4.00%           4.05%           4.14%           3.54%
    Taxable-equivalent adjustment       (552 )             (442 )             (437 )             (437 )             (387 )    
    Net interest income     $ 49,512             $ 48,761             $ 50,573             $ 51,697             $ 26,103      
    Ratio of average interest-earning assets to average interest-bearing liabilities         128%           127%           125%           124%           122%
                                                               
                                                               
    NOTES:                                                          
    (1) Yields and interest income on tax-exempt assets have been computed on a taxable-equivalent basis assuming a 21% tax rate.
    (2) Average balance of investment securities is computed at fair value.
    (3) Average balances include nonaccrual loans.
    (4) Interest income on loans includes prepayment and late fees, where applicable.
    (5) Interest income on loans includes accretion on purchase accounting marks of $4.9 million, $6.6 million, $7.6 million, $7.3 million and $0.2 million for the three months ended June 30, 2025, March 31, 2025, December 31, 2024, September 30, 2024 and June 30, 2024, respectively.
    ANALYSIS OF NET INTEREST INCOME        
    Average Balances and Interest Rates, Taxable-Equivalent Basis (Unaudited)    
    (continued)                      
      Six Months Ended
      June 30, 2025   June 30, 2024
          Taxable-   Taxable-       Taxable-   Taxable-
      Average   Equivalent   Equivalent   Average   Equivalent   Equivalent
    (In thousands) Balance   Interest   Rate   Balance   Interest   Rate
    Assets                      
    Federal funds sold & interest-bearing bank balances $ 169,541   $ 3,781     4.50 %   $ 108,695   $ 2,820     5.22 %
    Investment securities (1)(2)   884,730     20,787     4.70       529,151     11,808     4.47  
    Loans (1)(3)(4)(5)(6)   3,902,295     126,883     6.56       2,316,522     72,072     6.25  
    Total interest-earning assets   4,956,566     151,451     6.15       2,954,368     86,700     5.90  
    Other assets   443,528             200,580        
    Total assets $ 5,400,094           $ 3,154,948        
    Liabilities and Shareholders’ Equity                      
    Interest-bearing demand deposits $ 2,468,589     28,036     2.29     $ 1,610,188     19,310     2.41  
    Savings deposits   271,104     330     0.25       167,736     284     0.34  
    Time deposits   942,387     18,749     4.01       455,082     9,187     4.06  
    Total interest-bearing deposits   3,682,080     47,115     2.58       2,233,006     28,781     2.59  
    Securities sold under agreements to repurchase and federal funds purchased   26,039     190     1.47       12,711     52     0.83  
    FHLB advances and other borrowings   108,439     2,148     3.99       126,253     2,626     4.18  
    Subordinated notes and trust preferred debt   68,825     2,626     7.69       32,109     1,488     9.32  
    Total interest-bearing liabilities   3,885,383     52,079     2.70       2,404,079     32,947     2.76  
    Noninterest-bearing demand deposits   895,924             420,253        
    Other liabilities   89,067             60,078        
    Total liabilities   4,870,374             2,884,410        
    Shareholders’ equity   529,720             270,538        
    Total liabilities and shareholders’ equity $ 5,400,094           $ 3,154,948        
    Taxable-equivalent net interest income / net interest spread       99,372     3.45 %         53,753     3.14 %
    Taxable-equivalent net interest margin         4.04 %           3.65 %
    Taxable-equivalent adjustment       (1,099 )             (769 )    
    Net interest income     $ 98,273             $ 52,984      
    Ratio of average interest-earning assets to average interest-bearing liabilities         128 %           123 %
                           
    NOTES TO ANALYSIS OF NET INTEREST INCOME:                
    (1) Yields and interest income on tax-exempt assets have been computed on a taxable-equivalent basis assuming a 21% tax rate.
    (2) Average balance of investment securities is computed at fair value.
    (3) Average balances include nonaccrual loans.
    (4) Interest income on loans includes prepayment and late fees, where applicable.
    (5) Interest income on loans includes interest recovered of $1.6 million from the payoff of a commercial real estate loan on nonaccrual status for the six months ended June 30, 2024.
    (6) Interest income on loans includes accretion on purchase accounting marks of $11.5 million and $0.3 million for the six months ended June 30, 2025 and 2024, respectively.
    ORRSTOWN FINANCIAL SERVICES, INC.        
    HISTORICAL TRENDS IN QUARTERLY FINANCIAL DATA (Unaudited)        
                       
    (In thousands) June 30,
    2025    		   March 31,
    2025    		   December 31,
    2024    		   September 30,
    2024    		   June 30,
    2024
    Profitability for the quarter:                  
    Net interest income $ 49,512     $ 48,761     $ 50,573     $ 51,697     $ 26,103  
    Provision for (Recovery of) credit losses   109       (554 )     1,755       13,681       812  
    Noninterest income   12,915       11,624       11,247       12,386       7,172  
    Noninterest expenses   37,614       38,176       42,930       60,299       22,639  
    Income (loss) before income taxes   24,704       22,763       17,135       (9,897 )     9,824  
    Income tax expense (benefit)   5,256       4,712       3,451       (1,994 )     2,086  
    Net income (loss) $ 19,448     $ 18,051     $ 13,684     $ (7,903 )   $ 7,738  
                       
    Financial ratios:                  
    Return on average assets (1)   1.45 %     1.35 %     1.00 %   (0.57)%     0.97 %
    Return on average assets, adjusted (1)(2)(3)   1.51 %     1.45 %     1.22 %     1.55 %     1.09 %
    Return on average equity (1)   14.56 %     13.98 %     10.54 %   (5.85)%     11.41 %
    Return on average equity, adjusted (1)(2)(3)   15.12 %     14.97 %     12.86 %     15.85 %     12.88 %
    Net interest margin (1)   4.07 %     4.00 %     4.05 %     4.14 %     3.54 %
    Efficiency ratio   60.3 %     63.2 %     69.4 %     94.1 %     68.0 %
    Efficiency ratio, adjusted (2)(3)   58.7 %     60.5 %     62.3 %     60.2 %     64.6 %
                       
    Per share information:                  
    Income (loss) per common share:                  
    Basic $ 1.01     $ 0.94     $ 0.72     $ (0.41 )   $ 0.74  
    Basic, adjusted (2)(3)   1.05       1.01       0.87       1.12       0.84  
    Diluted   1.01       0.93       0.71       (0.41 )     0.73  
    Diluted, adjusted (2)(3)   1.04       1.00       0.87       1.11       0.83  
    Book value   28.07       27.32       26.65       26.65       25.97  
    Tangible book value(3)   22.77       21.99       21.19       21.12       24.08  
    Average tangible common equity(3)   18.43       17.91       13.62       (6.49 )     12.35  
    Cash dividends paid   0.26       0.26       0.23       0.23       0.20  
                       
    Average basic shares   19,172       19,157       19,118       19,088       10,393  
    Average diluted shares   19,342       19,328       19,300       19,226       10,553  

    (1)     Annualized.
    (2) Ratio has been adjusted for non-recurring expenses for all periods presented.
    (3) Non-GAAP based financial measure. Please refer to Appendix A – Supplemental Reporting of Non-GAAP Measures and GAAP to Non-GAAP Reconciliations for a discussion of our use of non-GAAP based financial measures, including tables reconciling GAAP and non-GAAP financial measures appearing herein.
     
    ORRSTOWN FINANCIAL SERVICES, INC.                
    HISTORICAL TRENDS IN QUARTERLY FINANCIAL DATA (Unaudited)        
    (continued)                  
    (In thousands) June 30,
    2025    		   March 31,
    2025    		   December 31,
    2024    		   September 30,
    2024    		   June 30,
    2024
    Noninterest income:                  
    Service charges $ 2,630   $ 2,395   $ 2,050     $ 2,360   $ 1,283  
    Interchange income   1,441     1,427     1,608       1,779     961  
    Swap fee income   669     394     597       505     375  
    Wealth management income   5,267     5,415     4,902       5,037     3,312  
    Mortgage banking activities   478     302     517       491     369  
    Other income   2,422     1,678     1,578       1,943     884  
    Investment securities gains (losses)   8     13     (5 )     271     (12 )
    Total noninterest income $ 12,915   $ 11,624   $ 11,247     $ 12,386   $ 7,172  
                       
    Noninterest expenses:                  
    Salaries and employee benefits $ 21,364   $ 20,388   $ 22,444     $ 27,190   $ 13,195  
    Occupancy, furniture and equipment   4,211     4,675     4,893       4,333     2,705  
    Data processing   965     924     1,540       2,046     1,237  
    Advertising and bank promotions   1,077     499     878       537     774  
    FDIC insurance   674     824     955       862     419  
    Professional services   2,016     1,826     1,591       1,119     801  
    Taxes other than income   295     942     (312 )     503     49  
    Intangible asset amortization   2,472     2,535     2,838       2,464     215  
    Provision for legal settlement   —     —     478       —     —  
    Merger-related expenses   968     1,649     3,887       16,977     1,135  
    Restructuring expenses   —     91     39       257     —  
    Other operating expenses   3,572     3,823     3,699       4,011     2,109  
    Total noninterest expenses $ 37,614   $ 38,176   $ 42,930     $ 60,299   $ 22,639  
                       
    HISTORICAL TRENDS IN QUARTERLY FINANCIAL DATA (Unaudited)            
    (continued)                  
    (In thousands) June 30,
    2025    		   March 31,
    2025    		   December 31,
    2024    		   September 30,
    2024    		   June 30,
    2024
    Balance Sheet at quarter end:                  
    Cash and cash equivalents $ 149,377     $ 287,120     $ 248,874     $ 236,780     $ 132,509  
    Restricted investments in bank stocks   21,204       19,693       20,232       20,247       11,147  
    Securities available for sale   885,373       855,456       829,711       826,828       529,082  
    Loans held for sale, at fair value   5,206       5,261       6,614       3,561       1,562  
    Loans:                  
    Commercial real estate:                  
    Owner occupied   622,315       617,854       633,567       622,726       371,301  
    Non-owner occupied   1,203,038       1,157,383       1,160,238       1,164,501       710,477  
    Multi-family   239,388       257,724       274,135       276,296       151,542  
    Non-owner occupied residential   163,018       168,354       179,512       190,786       89,156  
    Agricultural   124,291       134,916       125,156       129,486       25,551  
    Commercial and industrial   487,063       455,494       451,384       471,983       349,425  
    Acquisition and development:                  
    1-4 family residential construction   38,490       40,621       47,432       56,383       32,439  
    Commercial and land development   198,889       227,434       241,424       262,317       129,883  
    Municipal   28,693       30,780       30,044       27,960       10,594  
    Total commercial loans   3,105,185       3,090,560       3,142,892       3,202,438       1,870,368  
    Residential mortgage:                  
    First lien   472,030       464,642       460,297       451,195       271,153  
    Home equity – term   5,784       9,224       5,988       6,508       4,633  
    Home equity – lines of credit   305,968       295,820       303,561       303,165       192,736  
    Other – term(1)   25,384       —       —       —       —  
    Installment and other loans   17,028       15,739       18,476       18,131       8,713  
    Total loans   3,931,379       3,875,985       3,931,214       3,981,437       2,347,603  
    Allowance for credit losses   (47,898 )     (47,804 )     (48,689 )     (49,630 )     (29,864 )
    Net loans held for investment   3,883,481       3,828,181       3,882,525       3,931,807       2,317,739  
    Goodwill   69,751       68,106       68,106       70,655       18,724  
    Other intangible assets, net   42,748       45,230       47,765       46,144       1,974  
    Total assets   5,387,645       5,441,586       5,441,589       5,470,589       3,198,782  
    Total deposits   4,516,625       4,633,716       4,623,096       4,650,853       2,702,884  
    FHLB advances and other borrowings and Securities sold under agreements to repurchase   166,381       123,480       141,227       137,310       129,625  
    Subordinated notes and trust preferred debt   69,021       68,850       68,680       68,510       32,128  
    Total shareholders’ equity   548,448       532,936       516,682       516,206       278,376  
                       
    (1) Other – term includes property assessed clean energy (“PACE”) loans.
    HISTORICAL TRENDS IN QUARTERLY FINANCIAL DATA (Unaudited)            
    (continued)                  
      June 30,
    2025    		   March 31,
    2025    		   December 31,
    2024    		   September 30,
    2024    		   June 30,
    2024
    Capital and credit quality measures(1):                  
    Total risk-based capital:                  
    Orrstown Financial Services, Inc.   13.3 %     13.1 %     12.4 %     12.4 %     13.3 %
    Orrstown Bank   13.3 %     13.0 %     12.4 %     12.2 %     13.1 %
    Tier 1 risk-based capital:                  
    Orrstown Financial Services, Inc.   11.1 %     10.8 %     10.2 %     10.0 %     11.1 %
    Orrstown Bank   12.1 %     11.9 %     11.2 %     11.0 %     12.0 %
    Tier 1 common equity risk-based capital:                  
    Orrstown Financial Services, Inc.   10.9 %     10.6 %     10.0 %     9.8 %     11.1 %
    Orrstown Bank   12.1 %     11.9 %     11.2 %     11.0 %     12.0 %
    Tier 1 leverage capital:                  
    Orrstown Financial Services, Inc.   9.0 %     8.6 %     8.3 %     8.0 %     8.9 %
    Orrstown Bank   9.8 %     9.5 %     9.1 %     8.8 %     9.5 %
                       
    Average equity to average assets   9.97 %     9.65 %     9.45 %     9.75 %     8.50 %
    Allowance for credit losses to total loans   1.22 %     1.23 %     1.24 %     1.25 %     1.27 %
    Total nonaccrual loans to total loans   0.57 %     0.59 %     0.61 %     0.68 %     0.36 %
    Nonperforming assets to total assets   0.42 %     0.42 %     0.45 %     0.49 %     0.26 %
    Allowance for credit losses to nonaccrual loans   214 %     210 %     202 %     184 %     357 %
                       
    Other information:                  
    Net charge-offs $ 115     $ 331     $ 3,002     $ 269     $ 113  
    Classified loans   65,754       76,211       88,628       105,465       48,722  
    Nonperforming and other risk assets:                  
    Nonaccrual loans   22,423       22,727       24,111       26,927       8,363  
    Other real estate owned   —       138       138       138       —  
    Total nonperforming assets   22,423       22,865       24,249       27,065       8,363  
    Financial difficulty modifications still accruing   5,759       5,127       4,897       9,497       —  
    Loans past due 90 days or more and still accruing   1,312       400       641       337       187  
    Total nonperforming and other risk assets $ 29,494     $ 28,392     $ 29,787     $ 36,899     $ 8,550  
    (1) Capital ratios are estimated for the current period, subject to regulatory filings. The Company elected the three-year phase in option for the day-one impact of ASU 2016-13 for current expected credit losses (“CECL”) to regulatory capital. Beginning in 2023, the Company adjusted retained earnings, allowance for credit losses includable in tier 2 capital and the deferred tax assets from temporary differences in risk weighted assets by the permitted percentage of the day-one impact from adopting the new CECL standard.

    Appendix A- Supplemental Reporting of Non-GAAP Measures and GAAP to Non-GAAP Reconciliations

    Management believes providing certain other “non-GAAP” financial information will assist investors in their understanding of the effect on recent financial results from non-recurring charges.

    As a result of acquisitions, the Company has intangible assets consisting of goodwill, core deposit and other intangible assets, which totaled $112.5 million and $115.9 million at June 30, 2025 and December 31, 2024, respectively. In addition, during the three months ended June 30, 2025, March, 31, 2025, December 31, 2024, September 30, 2024 and June 30, 2024, the Company incurred $1.0 million, $1.6 million, $3.9 million, $17.0 million and $1.1 million in merger-related expenses, respectively. During the three months ended December 31, 2024 and September 30, 2024, the Company incurred other non-recurring charges totaling $0.5 million and $20.2 million, respectively.

    Tangible book value per common share, tangible common equity and the impact of the non-recurring expenses on net income and associated ratios, as used by the Company in this earnings release, are determined by methods other than in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”). While we believe this information is a useful supplement to GAAP based measures presented in this earnings release, readers are cautioned that this non-GAAP disclosure has limitations as an analytical tool, should not be viewed as a substitute for financial measures determined in accordance with GAAP, and should not be considered in isolation or as a substitute for analysis of our results and financial condition as reported under GAAP, nor are such measures necessarily comparable to non-GAAP performance measures that may be presented by other companies. This supplemental presentation should not be construed as an inference that our future results will be unaffected by similar adjustments to be determined in accordance with GAAP.

    The following tables present the computation of each non-GAAP based measure:

    (In thousands)

    Tangible Book Value per Common Share   June 30,
    2025    		   March 31,
    2025    		   December 31,
    2024    		   September 30,
    2024    		   June 30,
    2024
    Shareholders’ equity (most directly comparable GAAP-based measure)   $ 548,448     $ 532,936     $ 516,682     $ 516,206     $ 278,376  
    Less: Goodwill     69,751       68,106       68,106       70,655       18,724  
    Other intangible assets     42,748       45,230       47,765       46,144       1,974  
    Related tax effect     (8,977 )     (9,498 )     (10,031 )     (9,690 )     (415 )
    Tangible common equity (non-GAAP)   $ 444,926     $ 429,098     $ 410,842     $ 409,097     $ 258,093  
                         
    Common shares outstanding     19,536       19,510       19,390       19,373       10,720  
                         
    Book value per share (most directly comparable GAAP-based measure)   $ 28.07     $ 27.32     $ 26.65     $ 26.65     $ 25.97  
    Intangible assets per share     5.30       5.33       5.46       5.53       1.89  
    Tangible book value per share (non-GAAP)   $ 22.77     $ 21.99     $ 21.19     $ 21.12     $ 24.08  
                         
    Return on Average Common Equity   June 30,
    2025    		   March 31,
    2025    		   December 31,
    2024    		   September 30,
    2024    		   June 30,
    2024
    Average shareholders’ equity   $ 535,684     $ 523,689     $ 516,399     $ 537,670   $ 272,788  
    Less: Average goodwill     68,126       68,106       71,477       36,034     18,724  
    Less: Average other intangible assets, gross     44,304       46,864       45,319       17,393     2,105  
    Average tangible equity   $ 423,254     $ 408,719     $ 399,603     $ 484,243   $ 251,959  
    Return on average tangible equity     18.43 %     17.91 %     13.62 %   (6.49)%     12.35 %
                         
    (In thousands) Three Months Ended   Six Months Ended
    Adjusted Ratios for Non-recurring Charges June 30,
    2025    		   March 31, 2025   December 31,
    2024    		   September 30,
    2024    		   June 30,
    2024    		   June 30,
    2025    		     June 30,
    2024
    Net income (loss) (A) – most directly comparable GAAP-based measure $ 19,448     $ 18,051     $ 13,684     $ (7,903 )   $ 7,738     $ 37,499       $ 16,269  
    Plus: Merger-related expenses (B)   968       1,649       3,887       16,977       1,135       2,617         1,807  
    Plus: Executive retirement expenses (B)   —       —       35       4,758       —       —         —  
    Plus: Provision for credit losses on non-PCD loans (B)   —       —       —       15,504       —       —         —  
    Plus: Provision for legal settlement (B)   —       —       478       —       —       —         —  
    Less: Related tax effect (C)   (221 )     (368 )     (1,386 )     (7,915 )     (139 )     (590 )       (140 )
    Adjusted net income (D=A+B-C) – Non-GAAP $ 20,195     $ 19,332     $ 16,698     $ 21,421     $ 8,734     $ 39,526       $ 17,936  
                                 
    Average assets (E) $ 5,374,772     $ 5,425,697     $ 5,464,165     $ 5,515,143     $ 3,211,124     $ 5,400,094       $ 3,154,948  
    Return on average assets (= A / E) – most directly comparable GAAP-based measure (1)   1.45 %     1.35 %     1.00 %   (0.57)%     0.97 %     1.40 %       1.04 %
    Return on average assets, adjusted (= D / E) – Non-GAAP (1)   1.51 %     1.45 %     1.22 %     1.55 %     1.09 %     1.48 %       1.14 %
                                 
    Average equity (F) $ 535,684     $ 523,689     $ 516,399     $ 537,670     $ 272,788     $ 529,720       $ 270,538  
    Return on average equity (= A / F) – most directly comparable GAAP-based measure (1)   14.56 %     13.98 %     10.54 %   (5.85)%     11.41 %     14.28 %       12.09 %
    Return on average equity, adjusted (= D / F) – Non-GAAP (1)   15.12 %     14.97 %     12.86 %     15.85 %     12.88 %     15.05 %       13.33 %
                                 
    Weighted average shares – basic (G) – most directly comparable GAAP-based measure   19,173       19,157       19,118       19,088       10,393       19,165         10,371  
    Basic earnings (loss) per share (= A / G) – most directly comparable GAAP-based measure $ 1.01     $ 0.94     $ 0.72     $ (0.41 )   $ 0.74     $ 1.96       $ 1.57  
    Basic earnings per share, adjusted (= D / G) – Non-GAAP $ 1.05     $ 1.01     $ 0.87     $ 1.12     $ 0.84     $ 2.06       $ 1.73  
                                 
    Weighted average shares – diluted (H) – most directly comparable GAAP-based measure   19,342       19,328       19,300       19,226       10,553       19,335         10,517  
    Diluted earnings (loss) per share (= A / H) – most directly comparable GAAP-based measure $ 1.01     $ 0.93     $ 0.71     $ (0.41 )   $ 0.73     $ 1.94       $ 1.55  
    Diluted earnings per share, adjusted (= D / H) – Non-GAAP $ 1.04     $ 1.00     $ 0.87     $ 1.11     $ 0.83     $ 2.04       $ 1.71  
                                 
    (1) Annualized                            
      Three Months Ended   Six Months Ended
      June 30,
    2025    		   March 31, 2025   December 31,
    2024    		   September 30,
    2024    		   June 30,
    2024    		   June 30,
    2025    		     June 30,
    2024
    Noninterest expense (I) – most directly comparable GAAP-based measure $ 37,614     $ 38,176     $ 42,930     $ 60,299     $ 22,639     $ 75,790       $ 45,108  
    Less: Merger-related expenses (B)   (968 )     (1,649 )     (3,887 )     (16,977 )     (1,135 )     (2,617 )       (1,807 )
    Less: Executive retirement expenses (B)   —       —       (35 )     (4,758 )     —       —         —  
    Less: Provision for legal settlement (B)   —       —       (478 )     —       —       —         —  
    Adjusted noninterest expense (J = I – B) – Non-GAAP $ 36,646     $ 36,527     $ 38,531     $ 38,564     $ 21,504     $ 73,173       $ 43,301  
                                 
    Net interest income (K) $ 49,512     $ 48,761     $ 50,573     $ 51,697     $ 26,103     $ 98,273       $ 52,984  
    Noninterest income (L)   12,915       11,624       11,247       12,386       7,172       24,539         13,802  
    Total operating income (M = K + L) $ 62,427     $ 60,385     $ 61,820     $ 64,083     $ 33,275     $ 122,812       $ 66,786  
                                 
    Efficiency ratio (= I / M) – most directly comparable GAAP-based measure   60.3 %     63.2 %     69.4 %     94.1 %     68.0 %     61.7 %       67.5 %
    Efficiency ratio, adjusted (= J / M) – Non-GAAP   58.7 %     60.5 %     62.3 %     60.2 %     64.6 %     59.6 %       64.8 %
                                 
    (1) Annualized                            

    Appendix B- Investment Portfolio Concentrations

    The following table summarizes the credit ratings and collateral associated with the Company’s investment security portfolio, excluding equity securities, at June 30, 2025:

    (In thousands)

    Sector Portfolio Mix   Amortized Book   Fair Value   Credit Enhancement   AAA   AA   A   BBB   BB   NR   Collateral / Guarantee Type
    Unsecured ABS — %   $ 2,827   $ 2,673   28 %   — %   — %   — %   — %   — %   100 %   Unsecured Consumer Debt
    Student Loan ABS —       3,577     3,576   28     —     —     —     —     —     100     Seasoned Student Loans
    Federal Family Education Loan ABS 8       75,724     74,828   11     —     47     33     7     13     —     Federal Family Education Loan (1)
    PACE Loan ABS —       1,912     1,702   7     100     —     —     —     —     —     PACE Loans (2)
    Non-Agency CMBS 3       24,012     24,027   24     —     —     —     —     —     100      
    Non-Agency RMBS 2       15,936     14,596   16     100     —     —     —     —     —     Reverse Mortgages (3)
    Municipal – General Obligation 11       100,035     90,241       16     77     7     —     —     —      
    Municipal – Revenue 13       120,446     105,710       —     82     12     —     —     6      
    SBA ReRemic (5) —       1,904     1,890       —     100     —     —     —     —     SBA Guarantee (4)
    Small Business Administration 1       5,156     5,275       —     100     —     —     —     —     SBA Guarantee (4)
    Agency MBS 22       198,876     197,965       —     100     —     —     —     —     Residential Mortgages (4)
    Agency CMO 38       344,233     342,057       —     100     —     —     —     —      
    U.S. Treasury securities 2       20,036     18,641       —     100     —     —     —     —     U.S. Government Guarantee (4)
    Corporate bonds —       1,941     1,977       —     —     52     48     —     —      
      100 %   $ 916,615   $ 885,158       4 %   85 %   5 %   1 %   1 %   4 %    
                                               
    (1) 97% guaranteed by U.S. government
    (2) PACE acronym represents Property Assessed Clean Energy loans
    (3) Non-agency reverse mortgages with current structural credit enhancements
    (4) Guaranteed by U.S. government or U.S. government agencies
    (5) SBA ReRemic acronym represents Re-Securitization of Real Estate Mortgage Investment Conduits
                                               
    Note: Ratings in table are the lowest of the six rating agencies (Standard & Poor’s, Moody’s, Fitch, Morningstar, DBRS and Kroll Bond Rating Agency). Standard & Poor’s rates U.S. government obligations at AA+.

    About the Company

    With $5.4 billion in assets, Orrstown Financial Services, Inc. and its wholly-owned subsidiary, Orrstown Bank, provide a wide range of consumer and business financial services in Berks, Cumberland, Dauphin, Franklin, Lancaster, Perry and York Counties, Pennsylvania and Anne Arundel, Baltimore, Harford, Howard, and Washington Counties, Maryland, as well as Baltimore City, Maryland. The Company’s lending area also includes counties in Pennsylvania, Maryland, Delaware, Virginia and West Virginia within a 75-mile radius of the Company’s executive and administrative offices as well as the District of Columbia. Orrstown Bank is an Equal Housing Lender and its deposits are insured up to the legal maximum by the FDIC. Orrstown Financial Services, Inc.’s common stock is traded on Nasdaq (ORRF). For more information about Orrstown Financial Services, Inc. and Orrstown Bank, visit www.orrstown.com.

    Cautionary Note Regarding Forward-Looking Statements

    This press release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. Forward-looking statements reflect the current views of the Company’s management with respect to, among other things, future events and the Company’s financial performance. These statements are often, but not always, made through the use of words or phrases such as “may,” “should,” “could,” “predict,” “potential,” “believe,” “will likely result,” “expect,” “continue,” “will,” “anticipate,” “seek,” “estimate,” “intend,” “plan,” “project,” “forecast,” “goal,” “target,” “would” and “outlook,” or the negative variations of those words or other comparable words of a future or forward-looking nature. These forward-looking statements are not historical facts, and are based on current expectations, estimates, predictions or projections about events or the Company’s industry, management’s beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond the Company’s control. Accordingly, the Company cautions you that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions and uncertainties that are difficult to predict. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable as of the date made, actual results may prove to be materially different from the results expressed or implied by the forward-looking statements and there can be no assurances that the Company will achieve the desired level of new business development and new loans, growth in the balance sheet and fee-based revenue lines of business, cost savings initiatives and continued reductions in risk assets or mitigation of losses in the future. Factors which could cause the actual results to differ from those expressed or implied by the forward-looking statements include, but are not limited to, the following: interest rate changes or volatility; general economic conditions (including inflation and concerns about liquidity) on a national basis or in the local markets in which the Company operates; ineffectiveness of the Company’s strategic growth plan due to changes in current or future market conditions; the effects of competition and how it may impact our community banking model, including industry consolidation and development of competing financial products and services; changes in consumer behavior due to changing political, business and economic conditions, or legislative or regulatory initiatives; changes in, and evolving interpretations of, existing and future laws and regulations; changes in credit quality; inability to raise capital, if necessary, under favorable conditions; volatility in the securities markets; the demand for our products and services; deteriorating economic conditions; geopolitical tensions; operational risks including, but not limited to, cybersecurity incidents, fraud, natural disasters and future pandemics; expenses associated with litigation and legal proceedings; the possibility that the anticipated benefits of the merger with Codorus Valley Bancorp are not realized when expected or at all; and other risks and uncertainties, including those detailed in our Annual Report on Form 10-K for the year ended December 31, 2024 under the sections titled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and in subsequent filings made with the Securities and Exchange Commission.

    The foregoing list of factors is not exhaustive. If one or more events related to these or other risks or uncertainties materializes, or if the Company’s underlying assumptions prove to be incorrect, actual results may differ materially from what the Company anticipates. Accordingly, you should not place undue reliance on any such forward-looking statements. Any forward-looking statement speaks only as of the date on which it is made, and the Company disclaims any obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise. New risks and uncertainties arise from time to time, and it is not possible for the Company to predict those events or how they may affect it. In addition, the Company cannot assess the impact of each factor on its business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. All forward-looking statements, expressed or implied, included in this press release are expressly qualified in their entirety by this cautionary statement. This cautionary statement should also be considered in connection with any subsequent written or oral forward-looking statements that the Company or persons acting on the Company’s behalf may issue.

    The review period for subsequent events extends up to and includes the filing date of a public company’s financial statements, when filed with the Securities and Exchange Commission. Accordingly, the consolidated financial information presented in this announcement is subject to change. Annualized, pro forma, projected and estimated numbers in this document are used for illustrative purposes only and are not forecasts and may not reflect actual results.

    The MIL Network –

  • MIL-Evening Report: Central bank independence and credibility matters. Here’s why

    Source: The Conversation (Au and NZ) – By John Simon, Adjunct Fellow in Economics, Macquarie University

    Olga Kashubin/Shutterstock

    In the United States, President Donald Trump has been pressuring the chairman of the US Federal Reserve, Jerome Powell, to slash interest rates. This is partly to ease the interest payments on the ballooning US government debt.

    Powell has so far resisted, but Trump has also threatened to replace him with someone who will do what he asks.

    In Australia, after the Reserve Bank’s surprise decision to hold interest rates steady this month, some commentators have wondered if the central bank had “betrayed” Australians. Treasurer Jim Chalmers pointedly remarked:

    It’s not the result millions of Australians were hoping for or what the market was expecting.

    On Tuesday, the Reserve Bank released the minutes of that controversial policy-setting meeting, which said some economic data was slightly stronger than expected. The majority of the board believed:

    lowering the cash rate a third time within the space of four meetings would be unlikely to be consistent with the strategy of easing monetary policy in a cautious and gradual manner.

    Can’t rates just be kept low?

    Wouldn’t we be better off if central banks kept interest rates low, as some politicians and borrowers were hoping for? It would certainly help those of us with mortgages.

    Surprisingly, the answer is no.

    We are better off when central banks set interest rates with a view on the longer run rather than just the short-term demands of politicians and borrowers.

    To see why we can look at history to see what happens when a central bank isn’t independent.

    Why does independence matter?

    In the 1970s the chairman of the US Federal Reserve, Arthur Burns, was pressured to cut interest rates in the run-up to the 1972 election. He dutifully did so and, while President Richard Nixon was re-elected, this led to “stagflation” – with inflation, unemployment and even interest rates, higher than before interest rates were cut.

    A more recent example of political pressure can be seen in Turkey where the president pressured the central bank to cut interest rates. He hoped to stimulate the economy and believed higher interest rates caused higher inflation.

    Unfortunately, lower rates were shortly followed by higher inflation and, ultimately, much higher interest rates.

    And today in the US, even though Powell has so far resisted Trump’s pressure, financial markets are shaken and long-term interest rates go up when Trump talks about replacing him.

    Lower interest rates can be like a caffeinated energy drink – they give you a short-term energy boost, but can leave you tired, irritable and with a headache when the effects wear off.

    So, why does this happen? It’s all about expectations.

    Expectations about the future matter

    A central bank influences the economy both through what it does and what people expect it to do. The ability to shape expectations is a powerful tool for central banks, especially during crises such as the COVID pandemic, when official interest rates were close to zero.

    Imagine, for example, you are about to take out a mortgage. In making this decision you will likely think not just about current interest rates and your ability to make repayments, but what is likely to happen to future interest rates, your wages and inflation.

    Credibility is the key to successfully shaping people’s expectations. If a central bank is independent and credible, consumers and businesses will listen to what it says and adjust their expectations accordingly.

    The chart below illustrates this point.

    Macquarie University’s Business Outlook Scenarios Survey asks businesses if they believe the Reserve Bank will meet its inflation goals. Those that do trust the bank (the line labelled “certain”) have lower inflation expectations than those that don’t (the line labelled “uncertain”).

    Importantly, the expectations of those that trust the bank to meet its inflation goals tend to align with the bank’s 2–3% inflation target over the business cycle.

    And these expectations affect what businesses and consumers do today.

    So, how credible is the Reserve Bank today?

    Despite the surprise hold, Australians still trust the RBA

    Data from the Business Outlook Scenarios Survey shows the Reserve Bank has rebuilt its credibility since its 2021 “promise” not to raise interest rates until 2024. It has done this by reforming its board structure and membership, being more open and, most critically, by hitting the inflation target.

    Indeed, the most recent survey data shows that, if anything, the surprise decision increased people’s confidence in the bank’s ability to control inflation.

    In July, the survey was in the field between July 7 and 10. The Reserve Bank made its announcement on July 8. Out of 512 businesses surveyed, 368 completed it before the announcement and 144 completed it after the announcement.

    Overall, more than 40% of businesses surveyed were certain the Reserve Bank will achieve its inflation target. This is up from less than 10% a year ago. And, those who completed the survey after the announcement were more likely to trust the Reserve Bank than those that who completed it before the announcement.

    So next time you hear politicians and commentators calling for immediate interest rate cuts, you should hope the Reserve Bank ignores those calls and focuses on the longer term. Overseas experience shows things do not end well when politicians start determining interest rates.

    The authors do not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and have disclosed no relevant affiliations beyond their academic appointment.

    – ref. Central bank independence and credibility matters. Here’s why – https://theconversation.com/central-bank-independence-and-credibility-matters-heres-why-260198

    MIL OSI Analysis – EveningReport.nz –

  • MIL-OSI: Hanmi Reports 2025 Second Quarter Results

    Source: GlobeNewswire (MIL-OSI)

    LOS ANGELES, July 22, 2025 (GLOBE NEWSWIRE) — Hanmi Financial Corporation (NASDAQ: HAFC, or “Hanmi”), the parent company of Hanmi Bank (the “Bank”), today reported financial results for the second quarter of 2025.

    Net income for the second quarter of 2025 was $15.1 million, or $0.50 per diluted share, compared with $17.7 million, or $0.58 per diluted share for the first quarter of 2025. The return on average assets for the second quarter of 2025 was 0.79% and the return on average equity was 7.48%, compared with a return on average assets of 0.94% and a return on average equity of 8.92% for the first quarter of 2025.

    CEO Commentary

    “Hanmi delivered solid performance in the second quarter, highlighted by strong operational metrics,” said Bonnie Lee, President and Chief Executive Officer. “We further expanded our net interest margin to 3.07%, and grew preprovision net revenue by 3.7%, primarily driven by lower funding costs.”

    “Loans grew 1.6% on an annualized basis with healthy C&I and residential mortgage loan production. Our relationship-based model continued to drive deposit growth, up 1.7% for the quarter. Noninterest-bearing demand deposit balances remained strong, accounting for over 30% of total deposits.”

    “Our second quarter net income was impacted by credit loss expense; however, importantly, asset quality remained excellent with significant improvement from the prior quarter. Criticized loans, nonaccrual loans and delinquent loans all declined notably. Looking to the second half of the year, we are encouraged by the strength of our loan pipeline and remain focused on deepening client relationships, expanding our market presence and leveraging our balance sheet to deliver sustainable long-term growth.”

    Second Quarter 2025 Highlights:

    • Second quarter net income was $15.1 million, or $0.50 per diluted share, compared with $17.7 million, or $0.58 per diluted share in the first quarter; the decline was driven by credit loss expense of $7.6 million.
    • Preprovision net revenue1 grew 3.7%, or $1.0 million, reflecting a 3.7% increase in net interest income, a five basis point increase in the net interest margin, a 4.5% increase in noninterest income and well-managed noninterest expenses with the efficiency ratio remaining unchanged at 55.7%.
    • Asset quality improved significantly from the first quarter – criticized loans dropped 71.8% to 0.74% of total loans reflecting $85.3 million in loan upgrades of two CRE loans, a $20.0 million loan payment, and an $8.6 million loan charge-off; nonaccrual loans fell 26.8% to 0.41% of total loans reflecting the loan charge-off; and loan delinquencies declined to 0.17% of total loans.
    • Loans receivables were $6.31 billion at June 30, 2025, up 0.4% from the end of the first quarter of 2025; loan production for the second quarter was $329.6 million, with a weighted average interest rate of 7.10%.
    • Deposits were $6.73 billion at June 30, 2025, up 1.7% from the end of the first quarter of 2025; noninterest-bearing demand deposits at June 30, 2025 were 31.3% of total deposits.
    • Hanmi’s capital position remains strong with the ratio of tangible common equity to tangible assets2 at 9.58% and the common equity tier 1 capital ratio at 12.12%; both essentially unchanged from the first quarter; tangible book value per share3 was $24.91.

    ____________________________________
    1 See non-GAAP reconciliation provided at the end of this news release.

    For more information about Hanmi, please see the Q2 2025 Investor Update (and Supplemental Financial Information), which is available on the Bank’s website at www.hanmi.com and via a current report on Form 8-K on the website of the Securities and Exchange Commission at www.sec.gov. Also, please refer to “Non-GAAP Financial Measures” herein for further details of the presentation of certain non-GAAP financial measures.

    Quarterly Highlights
    (Dollars in thousands, except per share data)

        As of or for the Three Months Ended     Amount Change  
        June 30,     March 31,     December 31,     September 30,     June 30,     Q2-25     Q2-25  
        2025     2025     2024     2024     2024     vs. Q1-25     vs. Q2-24  
                                               
    Net income   $ 15,117     $ 17,672     $ 17,695     $ 14,892     $ 14,451     $ (2,555 )   $ 666  
    Net income per diluted common share   $ 0.50     $ 0.58     $ 0.58     $ 0.49     $ 0.48     $ (0.08 )   $ 0.02  
                                               
    Assets   $ 7,862,363     $ 7,729,035     $ 7,677,925     $ 7,712,299     $ 7,586,347     $ 133,328     $ 276,016  
    Loans receivable   $ 6,305,957     $ 6,282,189     $ 6,251,377     $ 6,257,744     $ 6,176,359     $ 23,768     $ 129,598  
    Deposits   $ 6,729,122     $ 6,619,475     $ 6,435,776     $ 6,403,221     $ 6,329,340     $ 109,647     $ 399,782  
                                               
    Return on average assets     0.79 %     0.94 %     0.93 %     0.79 %     0.77 %     -0.15       0.02  
    Return on average stockholders’ equity     7.48 %     8.92 %     8.89 %     7.55 %     7.50 %     -1.44       -0.02  
                                               
    Net interest margin     3.07 %     3.02 %     2.91 %     2.74 %     2.69 %     0.05       0.38  
    Efficiency ratio (1)     55.74 %     55.69 %     56.79 %     59.98 %     62.24 %     0.05       -6.50  
                                               
    Tangible common equity to tangible assets (2)     9.58 %     9.59 %     9.41 %     9.42 %     9.19 %     -0.01       0.39  
    Tangible common equity per common share (2)   $ 24.91     $ 24.49     $ 23.88     $ 24.03     $ 22.99       0.42       1.92  
                                               
    (1) Noninterest expense divided by net interest income plus noninterest income.  
    (2) Refer to “Non-GAAP Financial Measures” for further details.  


    Results of Operations
    Net interest income for the second quarter was $57.1 million, up 3.7% from $55.1 million for the first quarter of 2025. The increase reflected the benefit of lower rates on interest-bearing liabilities, a higher volume of interest-earning assets and one additional day in the quarter. Average interest-earning assets increased 1.2% while the average yield decreased by one basis point. Average loans receivable increased 1.1% while the average yield decreased by two basis points to 5.93%. Average interest-bearing liabilities increased 0.9% while the average rate paid declined seven basis points. Average interest-bearing deposits, however, increased 3.7% while the average rate paid declined by five basis points to 3.64%, primarily due to lower rates paid on time deposits. Average borrowings fell 66.5% while the average rate paid increased one basis point. 

    Net interest margin (taxable equivalent) for the second quarter was 3.07%, up five basis points from 3.02% for the first quarter of 2025. The increase in the net interest margin reflected principally the benefit from lower average borrowings and a higher average balance of interest-bearing deposits in other banks.

    ____________________________________
    2 See non-GAAP reconciliation provided at the end of this news release.
    3 See non-GAAP reconciliation provided at the end of this news release.

        For the Three Months Ended (in thousands)     Percentage Change  
        Jun 30,     Mar 31,     Dec 31,     Sep 30,     Jun 30,     Q2-25     Q2-25  
    Net Interest Income   2025     2025     2024     2024     2024     vs. Q1-25     vs. Q2-24  
                                               
    Interest and fees on loans receivable (1)   $ 92,589     $ 90,887     $ 91,545     $ 92,182     $ 90,752       1.9 %     2.0 %
    Interest on securities     6,261       6,169       5,866       5,523       5,238       1.5 %     19.5 %
    Dividends on FHLB stock     354       360       360       356       357       -1.7 %     -0.8 %
    Interest on deposits in other banks     2,129       1,841       2,342       2,356       2,313       15.6 %     -8.0 %
    Total interest and dividend income   $ 101,333     $ 99,257     $ 100,113     $ 100,417     $ 98,660       2.1 %     2.7 %
                                               
    Interest on deposits     41,924       40,559       43,406       47,153       46,495       3.4 %     -9.8 %
    Interest on borrowings     684       2,024       1,634       1,561       1,896       -66.2 %     -63.9 %
    Interest on subordinated debentures     1,586       1,582       1,624       1,652       1,649       0.3 %     -3.8 %
    Total interest expense     44,194       44,165       46,664       50,366       50,040       0.1 %     -11.7 %
    Net interest income   $ 57,139     $ 55,092     $ 53,449     $ 50,051     $ 48,620       3.7 %     17.5 %
                                               
    (1) Includes loans held for sale.  
        For the Three Months Ended (in thousands)     Percentage Change  
        Jun 30,     Mar 31,     Dec 31,     Sep 30,     Jun 30,     Q2-25     Q2-25  
    Average Earning Assets and Interest-bearing Liabilities   2025     2025     2024     2024     2024     vs. Q1-25     vs. Q2-24  
    Loans receivable (1)   $ 6,257,741     $ 6,189,531     $ 6,103,264     $ 6,112,324     $ 6,089,440       1.1 %     2.8 %
    Securities     993,975       1,001,499       998,313       986,041       979,671       -0.8 %     1.5 %
    FHLB stock     16,385       16,385       16,385       16,385       16,385       0.0 %     0.0 %
    Interest-bearing deposits in other banks     200,266       176,028       204,408       183,027       180,177       13.8 %     11.1 %
    Average interest-earning assets   $ 7,468,367     $ 7,383,443     $ 7,322,370     $ 7,297,777     $ 7,265,673       1.2 %     2.8 %
                                               
    Demand: interest-bearing   $ 81,308     $ 79,369     $ 79,784     $ 83,647     $ 85,443       2.4 %     -4.8 %
    Money market and savings     2,109,221       2,037,224       1,934,540       1,885,799       1,845,870       3.5 %     14.3 %
    Time deposits     2,434,659       2,345,346       2,346,363       2,427,737       2,453,154       3.8 %     -0.8 %
    Average interest-bearing deposits     4,625,188       4,461,939       4,360,687       4,397,183       4,384,467       3.7 %     5.5 %
    Borrowings     60,134       179,444       141,604       143,479       169,525       -66.5 %     -64.5 %
    Subordinated debentures     130,880       130,718       130,567       130,403       130,239       0.1 %     0.5 %
    Average interest-bearing liabilities   $ 4,816,202     $ 4,772,101     $ 4,632,858     $ 4,671,065     $ 4,684,231       0.9 %     2.8 %
                                               
    Average Noninterest Bearing Deposits                                          
    Demand deposits – noninterest bearing   $ 1,934,985     $ 1,895,953     $ 1,967,789     $ 1,908,833     $ 1,883,765       2.1 %     2.7 %
                                               
    (1) Includes loans held for sale.  
        For the Three Months Ended     Yield/Rate Change  
        Jun 30,     Mar 31,     Dec 31,     Sep 30,     Jun 30,     Q2-25     Q2-25  
    Average Yields and Rates   2025     2025     2024     2024     2024     vs. Q1-25     vs. Q2-24  
    Loans receivable (1)     5.93 %     5.95 %     5.97 %     6.00 %     5.99 %     -0.02       -0.06  
    Securities (2)     2.55 %     2.49 %     2.38 %     2.27 %     2.17 %     0.06       0.38  
    FHLB stock     8.65 %     8.92 %     8.75 %     8.65 %     8.77 %     -0.27       -0.12  
    Interest-bearing deposits in other banks     4.26 %     4.24 %     4.56 %     5.12 %     5.16 %     0.02       -0.90  
    Interest-earning assets     5.44 %     5.45 %     5.45 %     5.48 %     5.46 %     -0.01       -0.02  
                                               
    Interest-bearing deposits     3.64 %     3.69 %     3.96 %     4.27 %     4.27 %     -0.05       -0.63  
    Borrowings     4.58 %     4.57 %     4.59 %     4.33 %     4.50 %     0.01       0.08  
    Subordinated debentures     4.84 %     4.84 %     4.97 %     5.07 %     5.07 %     0.00       -0.23  
    Interest-bearing liabilities     3.68 %     3.75 %     4.01 %     4.29 %     4.30 %     -0.07       -0.62  
                                               
    Net interest margin (taxable equivalent basis)     3.07 %     3.02 %     2.91 %     2.74 %     2.69 %     0.05       0.38  
                                               
    Cost of deposits     2.56 %     2.59 %     2.73 %     2.97 %     2.98 %     -0.03       -0.42  
                                               
    (1) Includes loans held for sale.  
    (2) Amounts calculated on a fully taxable equivalent basis using the federal tax rate in effect for the periods presented.  

    Credit loss expense for the second quarter was $7.6 million, compared with $2.7 million for the first quarter of 2025. The increase in credit loss expense reflected the increase in net charge-offs as well as an increase in quantitative and qualitative estimated loss rates. Net charge-offs included an $8.6 million loan charge-off on the syndicated commercial real estate office loan designated as nonaccrual, with an associated specific allowance of $6.2 million, in the first quarter of 2025. Second quarter credit loss expense included a $7.5 million credit loss expense for loan losses and a $0.1 million credit loss expense for off-balance sheet items. First quarter credit loss expense included a $2.4 million credit loss expense for loan losses and a $0.3 million credit loss expense for off-balance sheet items.

    Noninterest income for the second quarter increased $0.4 million, or 4.5%, to $8.1 million from $7.7 million for the first quarter of 2025. The increase was primarily due to a $0.2 million increase on gains from the sale of SBA loans and an increase in bank-owned life insurance income of $0.4 million from a death benefit claim, partially offset by the absence of gain on sale of mortgage loans. Gain on sales of SBA loans were $2.2 million for the second quarter of 2025, compared with $2.0 million for the first quarter of 2025. The volume of SBA loans sold for the second quarter increased to $35.4 million from $32.2 million for the first quarter of 2025, while trade premiums were 7.61% for the second quarter of 2025 compared with 7.82% for the first quarter. There were no mortgage loans sales during the second quarter, compared with $10.0 million of mortgage loans sold at a 2.50% premium for the first quarter. Gains on mortgage loans sold were $0.2 million for the first quarter. Subsequent to the end of the second quarter, $41.9 million of mortgage loans were sold at a 2.38% premium resulting in a gain of $0.7 million.

        For the Three Months Ended (in thousands)     Percentage Change  
        Jun 30,     Mar 31,     Dec 31,     Sep 30,     Jun 30,     Q2-25     Q2-25  
    Noninterest Income   2025     2025     2024     2024     2024     vs. Q1-25     vs. Q2-24  
    Service charges on deposit accounts   $ 2,169     $ 2,217     $ 2,192     $ 2,311     $ 2,429       -2.2 %     -10.7 %
    Trade finance and other service charges and fees     1,461       1,396       1,364       1,254       1,277       4.7 %     14.4 %
    Servicing income     754       732       668       817       796       3.0 %     -5.3 %
    Bank-owned life insurance income     708       309       316       320       638       129.1 %     11.0 %
    All other operating income     819       897       1,037       1,008       908       -8.7 %     -9.8 %
    Service charges, fees & other     5,911       5,551       5,577       5,710       6,048       6.5 %     -2.3 %
                                               
    Gain on sale of SBA loans     2,160       2,000       1,443       1,544       1,644       8.0 %     31.4 %
    Gain on sale of mortgage loans     –       175       337       324       365       -100.0 %     -100.0 %
    Gain on sale of bank premises     –       –       –       860       –       0.0 %     0.0 %
    Total noninterest income   $ 8,071     $ 7,726     $ 7,357     $ 8,438     $ 8,057       4.5 %     0.2 %

    Noninterest expense for the second quarter increased $1.3 million to $36.3 million from $35.0 million for the first quarter of 2025. Second quarter noninterest expense was up 3.9% sequentially due to increases in salaries and benefits, professional fees, advertising and promotion and all other operating expenses, partially offset by a $0.6 million gain on sale of other real estate owned. Salaries and benefits increased $1.1 million due to annual merit adjustments and lower capitalized salaries related to loan production. Professional fees increased $0.3 million due to new project activities and fees for services. Advertising and promotion increased $0.2 million primarily due to a new branch opening. All other operating expenses increased $0.4 million due to loan and deposit operating expenses. The efficiency ratio for the second quarter was 55.7%, unchanged from the first quarter of 2025.

        For the Three Months Ended (in thousands)     Percentage Change  
        Jun 30,     Mar 31,     Dec 31,     Sep 30,     Jun 30,     Q2-25     Q2-25  
        2025     2025     2024     2024     2024     vs. Q1-25     vs. Q2-24  
    Noninterest Expense                                          
    Salaries and employee benefits   $ 22,069     $ 20,972     $ 20,498     $ 20,851     $ 20,434       5.2 %     8.0 %
    Occupancy and equipment     4,344       4,450       4,503       4,499       4,348       -2.4 %     -0.1 %
    Data processing     3,727       3,787       3,800       3,839       3,686       -1.6 %     1.1 %
    Professional fees     1,725       1,468       1,821       1,492       1,749       17.5 %     -1.4 %
    Supplies and communication     515       517       551       538       570       -0.4 %     -9.6 %
    Advertising and promotion     798       585       821       631       669       36.4 %     19.3 %
    All other operating expenses     3,567       3,175       3,847       2,875       3,251       12.3 %     9.7 %
    Subtotal     36,745       34,954       35,841       34,725       34,707       5.1 %     5.9 %
                                               
    Branch consolidation expense     –       –       –       –       301       0.0 %     -100.0 %
    Other real estate owned expense (income)     (461 )     41       (1,588 )     77       6     N/M     N/M  
    Repossessed personal property expense (income)     63       (11 )     281       278       262       -672.7 %     -76.0 %
    Total noninterest expense   $ 36,347     $ 34,984     $ 34,534     $ 35,080     $ 35,276       3.9 %     3.0 %

    Hanmi recorded a provision for income taxes of $6.1 million for the second quarter of 2025, compared with $7.4 million for the first quarter of 2025, representing an effective tax rate of 28.8% and 29.6%, respectively.

    Financial Position
    Total assets at June 30, 2025 increased 1.7%, or $133.3 million, to $7.86 billion from $7.73 billion at March 31, 2025. The increase reflected a $51.0 million increase in cash, a $37.8 million increase in loans held for sale, a $27.6 million increase in loans, a $11.1 million increase in securities available for sale, and a $6.7 million increase in prepaid expenses and other assets.

    Loans receivable, before allowance for credit losses, were $6.31 billion at June 30, 2025, up from $6.28 billion at March 31, 2025.

    Loans held-for-sale were $49.6 million at June 30, 2025, up from $11.8 million at March 31, 2025. At the end of the second quarter, loans held-for-sale consisted of $41.9 million of residential mortgage loans and $7.7 million of the guaranteed portion of SBA 7(a) loans.

        As of (in thousands)     Percentage Change  
        Jun 30,     Mar 31,     Dec 31,     Sep 30,     Jun 30,     Q2-25     Q2-25  
        2025     2025     2024     2024     2024     vs. Q1-25     vs. Q2-24  
    Loan Portfolio                                          
    Commercial real estate loans   $ 3,948,922     $ 3,975,651     $ 3,949,622     $ 3,932,088     $ 3,888,505       -0.7 %     1.6 %
    Residential/consumer loans     993,869       979,536       951,302       939,285       954,209       1.5 %     4.2 %
    Commercial and industrial loans     917,995       854,406       863,431       879,092       802,372       7.4 %     14.4 %
    Equipment finance     445,171       472,596       487,022       507,279       531,273       -5.8 %     -16.2 %
    Loans receivable     6,305,957       6,282,189       6,251,377       6,257,744       6,176,359       0.4 %     2.1 %
    Loans held for sale     49,611       11,831       8,579       54,336       10,467       319.3 %     374.0 %
    Total   $ 6,355,568     $ 6,294,020     $ 6,259,956     $ 6,312,080     $ 6,186,826       1.0 %     2.7 %
        As of  
        Jun 30,     Mar 31,     Dec 31,     Sep 30,     Jun 30,  
        2025     2025     2024     2024     2024  
    Composition of Loan Portfolio                              
    Commercial real estate loans     62.2 %     63.1 %     63.1 %     62.3 %     62.9 %
    Residential/consumer loans     15.6 %     15.6 %     15.2 %     14.9 %     15.4 %
    Commercial and industrial loans     14.4 %     13.6 %     13.8 %     13.9 %     13.0 %
    Equipment finance     7.0 %     7.5 %     7.8 %     8.0 %     8.5 %
    Loans receivable     99.2 %     99.8 %     99.9 %     99.1 %     99.8 %
    Loans held for sale     0.8 %     0.2 %     0.1 %     0.9 %     0.2 %
    Total     100.0 %     100.0 %     100.0 %     100.0 %     100.0 %

    New loan production was $329.6 million for the second quarter of 2025 with an average rate of 7.10%, while payoffs were $119.1 million during the quarter at an average rate of 6.47%.

    Commercial real estate loan production for the second quarter of 2025 was $112.0 million. Residential mortgage loan production was $83.8 million. Commercial and industrial loan production was $53.4 million, SBA loan production was $46.8 million, and equipment finance production was $33.6 million.

        For the Three Months Ended (in thousands)  
        Jun 30,     Mar 31,     Dec 31,     Sep 30,     Jun 30,  
        2025     2025     2024     2024     2024  
    New Loan Production                              
    Commercial real estate loans   $ 111,993     $ 146,606     $ 146,716     $ 110,246     $ 87,632  
    Residential/consumer loans     83,761       55,000       40,225       40,758       30,194  
    Commercial and industrial loans     53,444       42,344       60,159       105,086       59,007  
    SBA loans     46,829       55,242       49,740       51,616       54,486  
    Equipment finance     33,567       46,749       42,168       40,066       42,594  
    Subtotal     329,594       345,941       339,008       347,772       273,913  
                                   
                                   
    Payoffs     (119,139 )     (125,102 )     (137,933 )     (77,603 )     (148,400 )
    Amortization     (151,357 )     (90,743 )     (60,583 )     (151,674 )     (83,640 )
    Loan sales     (35,388 )     (42,193 )     (67,852 )     (43,868 )     (42,945 )
    Net line utilization     12,435       (53,901 )     (75,651 )     9,426       1,929  
    Charge-offs & OREO     (12,377 )     (3,190 )     (3,356 )     (2,668 )     (2,338 )
                                   
    Loans receivable-beginning balance     6,282,189       6,251,377       6,257,744       6,176,359       6,177,840  
    Loans receivable-ending balance   $ 6,305,957     $ 6,282,189     $ 6,251,377     $ 6,257,744     $ 6,176,359  

    Deposits were $6.73 billion at the end of the second quarter of 2025, up $109.6 million, or 1.7%, from $6.62 billion at the end of the prior quarter. Driving the change was a $42.7 million increase in time deposits, a $38.7 million increase in noninterest-bearing demand deposits and a $18.9 million increase in money market and savings deposits. Noninterest-bearing demand deposits represented 31.3% of total deposits at June 30, 2025 and the loan-to-deposit ratio was 93.7%.

        As of (in thousands)     Percentage Change  
        Jun 30,     Mar 31,     Dec 31,     Sep 30,     Jun 30,     Q2-25     Q2-25  
        2025     2025     2024     2024     2024     vs. Q1-25     vs. Q2-24  
    Deposit Portfolio                                          
    Demand: noninterest-bearing   $ 2,105,369     $ 2,066,659     $ 2,096,634     $ 2,051,790     $ 1,959,963       1.9 %     7.4 %
    Demand: interest-bearing     90,172       80,790       80,323       79,287       82,981       11.6 %     8.7 %
    Money market and savings     2,092,847       2,073,943       1,933,535       1,898,834       1,834,797       0.9 %     14.1 %
    Time deposits     2,440,734       2,398,083       2,325,284       2,373,310       2,451,599       1.8 %     -0.4 %
    Total deposits   $ 6,729,122     $ 6,619,475     $ 6,435,776     $ 6,403,221     $ 6,329,340       1.7 %     6.3 %
        As of  
        Jun 30,     Mar 31,     Dec 31,     Sep 30,     Jun 30,  
        2025     2025     2024     2024     2024  
    Composition of Deposit Portfolio                              
    Demand: noninterest-bearing     31.3 %     31.2 %     32.6 %     32.0 %     31.0 %
    Demand: interest-bearing     1.3 %     1.2 %     1.2 %     1.2 %     1.3 %
    Money market and savings     31.1 %     31.3 %     30.0 %     29.7 %     29.0 %
    Time deposits     36.3 %     36.3 %     36.2 %     37.1 %     38.7 %
    Total deposits     100.0 %     100.0 %     100.1 %     100.0 %     100.0 %

    Stockholders’ equity at June 30, 2025 was $762.8 million, up $11.3 million from $751.5 million at March 31, 2025. The increase included net income, net of dividends paid, of $7.0 million for the second quarter. In addition, the increase in stockholders’ equity included a $5.5 million decrease in unrealized after-tax losses on securities available for sale, due to changes in interest rates during the second quarter of 2025. Hanmi also repurchased 70,000 shares of common stock at a cost of $1.6 million, for an average share price of $23.26, during the quarter. At June 30, 2025, 1,110,500 shares remain under Hanmi’s share repurchase program. Tangible common stockholders’ equity was $751.8 million, or 9.58% of tangible assets at June 30, 2025 compared with $740.5 million, or 9.59% of tangible assets at the end of the prior quarter. Please refer to the Non-GAAP Financial Measures section below for more information.

    Hanmi and the Bank exceeded minimum regulatory capital requirements, and the Bank continues to exceed the minimum for the “well capitalized” category. At June 30, 2025, Hanmi’s preliminary common equity tier 1 capital ratio was 12.12% and its total risk-based capital ratio was 15.20%, compared with 12.12% and 15.28%, respectively, at the end of the prior quarter.

        As of     Ratio Change  
        Jun 30,     Mar 31,     Dec 31,     Sep 30,     Jun 30,     Q2-25     Q2-25  
        2025     2025     2024     2024     2024     vs. Q1-25     vs. Q2-24  
    Regulatory Capital ratios (1)                                          
    Hanmi Financial                                          
    Total risk-based capital     15.20 %     15.28 %     15.24 %     15.03 %     15.24 %     -0.08       -0.04  
    Tier 1 risk-based capital     12.46 %     12.46 %     12.46 %     12.29 %     12.46 %     0.00       0.00  
    Common equity tier 1 capital     12.12 %     12.12 %     12.11 %     11.95 %     12.11 %     0.00       0.01  
    Tier 1 leverage capital ratio     10.63 %     10.67 %     10.63 %     10.56 %     10.51 %     -0.04       0.12  
    Hanmi Bank                                          
    Total risk-based capital     14.39 %     14.47 %     14.43 %     14.27 %     14.51 %     -0.08       -0.12  
    Tier 1 risk-based capital     13.32 %     13.34 %     13.36 %     13.23 %     13.47 %     -0.02       -0.15  
    Common equity tier 1 capital     13.32 %     13.34 %     13.36 %     13.23 %     13.47 %     -0.02       -0.15  
    Tier 1 leverage capital ratio     11.43 %     11.49 %     11.47 %     11.43 %     11.41 %     -0.06       0.02  
                                               
    (1) Preliminary ratios for June 30, 2025  


    Asset Quality
    Loans 30 to 89 days past due and still accruing were 0.17% of loans at the end of the second quarter of 2025, compared with 0.28% at the end of the prior quarter.

    Criticized loans totaled $46.6 million at June 30, 2025, down from $164.9 million at the end of the prior quarter. The $118.3 million decrease resulted from a $105.7 million decrease in special mention loans, and a $12.6 million decrease in classified loans. The $105.7 million decrease in special mention loans included loan upgrades of $85.3 million of two commercial real estate loans, paydowns of $20.0 million and amortization of $0.7 million, offset by downgrades of $0.3 million. The $12.6 million decrease in classified loans resulted from $8.7 million of loan charge-offs (primarily due to the previously mentioned $8.6 million commercial real estate loan charge-off), $2.9 million of equipment financing charge-offs, $1.6 million of amortization/paydowns, $4.0 million of loan upgrades and, $0.2 million of payoffs, offset by $4.8 million in additions. Additions included newly classified equipment financing agreements of $2.4 million and loan downgrades of $2.4 million.

    Nonperforming loans were $26.0 million at June 30, 2025, down from $35.6 million at the end of the prior quarter. The $9.6 million decrease primarily reflected charge-offs of $11.6 million, $1.3 million in paydowns, loan upgrades of $1.0 million, and pay-offs of $0.2 million. Additions included $2.1 million of loans and $2.5 million of equipment financing agreements.

    Nonperforming assets were $26.0 million at June 30, 2025, down from $35.7 million at the end of the prior quarter. As a percentage of total assets, nonperforming assets were 0.33% at June 30, 2025, and 0.46% at the end of the prior quarter.

    Gross charge-offs for the second quarter of 2025 were $12.4 million, compared with $3.2 million for the preceding quarter. The increase in gross charge-offs was primarily due to a $8.6 million charge-off on a commercial real estate loan designated as nonaccrual during the first quarter of 2025. Charge-offs during the second quarter also included $2.9 million on equipment financing agreements. Recoveries of previously charged-off loans were $1.0 million in the second quarter of 2025, which included $0.6 million of recoveries on equipment financing agreements. As a result, there were $11.4 million of net charge-offs for the second quarter of 2025, compared to $1.9 million for the prior quarter.

    The allowance for credit losses was $66.8 million at June 30, 2025, compared with $70.6 million at March 31, 2025. Collectively evaluated allowances increased $3.8 million and specific allowances for loans decreased $7.6 million. The decrease in specific allowances was a result of the previously mentioned $8.6 million charge-off. The ratio of the allowance for credit losses to loans was 1.06% at June 30, 2025 and 1.12% at the end of the prior quarter.

        As of or for the Three Months Ended (in thousands)     Amount Change  
        Jun 30,     Mar 31,     Dec 31,     Sep 30,     Jun 30,     Q2-25     Q2-25  
        2025     2025     2024     2024     2024     vs. Q1-25     vs. Q2-24  
    Asset Quality Data and Ratios                                          
                                               
    Delinquent loans:                                          
    Loans, 30 to 89 days past due and still accruing   $ 10,953     $ 17,312     $ 18,454     $ 15,027     $ 13,844     $ (6,359 )   $ (2,891 )
    Delinquent loans to total loans     0.17 %     0.28 %     0.30 %     0.24 %     0.22 %     (0.11 )     (0.05 )
                                               
    Criticized loans:                                          
    Special mention   $ 12,701     $ 118,380     $ 139,612     $ 131,575     $ 36,921     $ (105,679 )   $ (24,220 )
    Classified     33,857       46,519       25,683       28,377       33,945       (12,662 )     (88 )
    Total criticized loans (1)   $ 46,558     $ 164,899     $ 165,295     $ 159,952     $ 70,866     $ (118,341 )   $ (24,308 )
                                               
    Criticized loans to total loans     0.74 %     2.62 %     2.64 %     2.56 %     1.15 %     (1.88 )     (0.41 )
                                               
    Nonperforming assets:                                          
    Nonaccrual loans   $ 25,968     $ 35,459     $ 14,272     $ 15,248     $ 19,245     $ (9,491 )   $ 6,723  
    Loans 90 days or more past due and still accruing     –       112       –       242       –       (112 )     –  
    Nonperforming loans (2)     25,968       35,571       14,272       15,490       19,245       (9,603 )     6,723  
    Other real estate owned, net     –       117       117       772       772       (117 )     (772 )
    Nonperforming assets (3)   $ 25,968     $ 35,688     $ 14,389     $ 16,262     $ 20,017     $ (9,720 )   $ 5,951  
                                               
    Nonperforming assets to assets (2)     0.33 %     0.46 %     0.19 %     0.21 %     0.26 %     -0.13       0.07  
    Nonperforming loans to total loans     0.41 %     0.57 %     0.23 %     0.25 %     0.31 %     -0.16       0.10  
                                               
    (1) Includes nonaccrual loans of $24.1 million, $34.4 million, $13.4 million, $13.6 million, and $18.4 million as of Q2-25, Q1-25, Q4-24, Q3-24, and Q2-24, respectively.  
    (2) Excludes a $27.2 million nonperforming loan held-for-sale as of September 30, 2024.  
    (3) Excludes repossessed personal property of $0.6 million, $0.7 million, $0.6 million, $1.2 million, and $1.2 million as of Q2-25, Q1-25, Q4-24, Q3-24, and Q2-24, respectively.  
        As of or for the Three Months Ended (in thousands)  
        Jun 30,     Mar 31,     Dec 31,     Sep 30,     Jun 30,  
        2025     2025     2024     2024     2024  
    Allowance for credit losses related to loans:                              
    Balance at beginning of period   $ 70,597     $ 70,147     $ 69,163     $ 67,729     $ 68,270  
    Credit loss expense (recovery) on loans     7,524       2,396       855       2,312       1,248  
    Net loan (charge-offs) recoveries     (11,365 )     (1,946 )     129       (878 )     (1,789 )
    Balance at end of period   $ 66,756     $ 70,597     $ 70,147     $ 69,163     $ 67,729  
                                   
    Net loan charge-offs (recoveries) to average loans (1)     0.73 %     0.13 %     -0.01 %     0.06 %     0.12 %
    Allowance for credit losses to loans     1.06 %     1.12 %     1.12 %     1.11 %     1.10 %
                                   
    Allowance for credit losses related to off-balance sheet items:                              
    Balance at beginning of period   $ 2,399     $ 2,074     $ 1,984     $ 2,010     $ 2,297  
    Credit loss expense (recovery) on off-balance sheet items     107       325       90       (26 )     (287 )
    Balance at end of period   $ 2,506     $ 2,399     $ 2,074     $ 1,984     $ 2,010  
                                   
    Unused commitments to extend credit   $ 915,847     $ 896,282     $ 782,587     $ 739,975     $ 795,391  
                                   
    (1) Annualized                              


    Corporate Developments
    On April 24, 2025, Hanmi’s Board of Directors declared a cash dividend on its common stock for the 2025 second quarter of $0.27 per share. Hanmi paid the dividend on May 21, 2025, to stockholders of record as of the close of business on May 5, 2025.

    Earnings Conference Call
    Hanmi Bank will host its second quarter 2025 earnings conference call today, July 22, 2025, at 2:00 p.m. PST (5:00 p.m. EST) to discuss these results. This call will also be webcast. To access the call, please dial 1-877-407-9039 before 2:00 p.m. PST, using access code Hanmi Bank. To listen to the call online, either live or archived, please visit Hanmi’s Investor Relations website at https://investors.hanmi.com/ where it will also be available for replay approximately one hour following the call.

    About Hanmi Financial Corporation
    Headquartered in Los Angeles, California, Hanmi Financial Corporation owns Hanmi Bank, which serves multi-ethnic communities through its network of 32 full-service branches and eight loan production offices in California, Texas, Illinois, Virginia, New Jersey, New York, Colorado, Washington and Georgia. Hanmi Bank specializes in real estate, commercial, SBA and trade finance lending to small and middle market businesses. Additional information is available at www.hanmi.com.

    Forward-Looking Statements
    This press release contains forward-looking statements, which are included in accordance with the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact are “forward–looking statements” for purposes of federal and state securities laws, including, but not limited to, statements about our anticipated future operating and financial performance, financial position and liquidity, business strategies, regulatory and competitive outlook, investment and expenditure plans, capital and financing needs and availability, plans and objectives of management for future operations, developments regarding our capital and strategic plans, and other similar forecasts and statements of expectation and statements of assumption underlying any of the foregoing. In some cases, you can identify forward-looking statements by terminology such as “may,” “will,” “should,” “could,” “expects,” “plans,” “intends,” “anticipates,” “believes,” “estimates,” “predicts,” “potential,” or “continue,” or the negative of such terms and other comparable terminology. Although we believe that our forward-looking statements to be reasonable, we cannot guarantee future results, levels of activity, performance or achievements.

    Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to differ from those expressed or implied by the forward-looking statements. These factors include the following:

    • a failure to maintain adequate levels of capital and liquidity to support our operations;
    • general economic and business conditions internationally, nationally and in those areas in which we operate, including any potential recessionary conditions;
    • volatility and deterioration in the credit and equity markets;
    • changes in investor sentiment or consumer spending, borrowing and savings habits;
    • availability of capital from private and government sources;
    • demographic changes;
    • competition for loans and deposits and failure to attract or retain loans and deposits;
    • inflation and fluctuations in interest rates that reduce our margins and yields, the fair value of financial instruments, the level of loan originations or prepayments on loans we have made and make, the level of loan sales and the cost we pay to retain and attract deposits and secure other types of funding;
    • our ability to enter new markets successfully and capitalize on growth opportunities;
    • the current or anticipated impact of military conflict, terrorism or other geopolitical events;
    • the effect of potential future supervisory action against us or Hanmi Bank and our ability to address any issues raised in our regulatory exams;
    • risks of natural disasters;
    • legal proceedings and litigation brought against us;
    • a failure in or breach of our operational or security systems or infrastructure, including cyberattacks;
    • the failure to maintain current technologies;
    • risks associated with Small Business Administration loans;
    • failure to attract or retain key employees;
    • our ability to access cost-effective funding;
    • the imposition of tariffs or other domestic or international governmental policies and retaliatory responses;
    • changes in liquidity, including the size and composition of our deposit portfolio and the percentage of uninsured deposits in the portfolio;
    • fluctuations in real estate values;
    • changes in accounting policies and practices;
    • changes in governmental regulation, including, but not limited to, any increase in FDIC insurance premiums and changes in the monetary policies of the U.S. Treasury and the Board of Governors of the Federal Reserve System;
    • the ability of Hanmi Bank to make distributions to Hanmi Financial Corporation, which is restricted by certain factors, including Hanmi Bank’s retained earnings, net income, prior distributions made, and certain other financial tests;
    • strategic transactions we may enter into;
    • the adequacy of and changes in the economic assumptions and methodology for computing our allowance for credit losses;
    • our credit quality and the effect of credit quality on our credit losses expense and allowance for credit losses;
    • changes in the financial performance and/or condition of our borrowers and the ability of our borrowers to perform under the terms of their loans and other terms of credit agreements;
    • our ability to control expenses; and
    • cyber security and fraud risks against our information technology and those of our third-party providers and vendors.

    In addition, we set forth certain risks in our reports filed with the U.S. Securities and Exchange Commission, including, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2024, our Quarterly Reports on Form 10-Q, and Current Reports on Form 8-K that we will file hereafter, which could cause actual results to differ from those projected. We undertake no obligation to update such forward-looking statements except as required by law.

    Investor Contacts:
    Romolo (Ron) Santarosa
    Senior Executive Vice President & Chief Financial Officer
    213-427-5636

    Lisa Fortuna
    Investor Relations
    Financial Profiles, Inc.
    lfortuna@finprofiles.com
    310-622-8251

    Hanmi Financial Corporation and Subsidiaries
    Consolidated Balance Sheets (Unaudited)
    (Dollars in thousands)

        June 30,     March 31,     Percentage     June 30,     Percentage  
        2025     2025     Change     2024     Change  
    Assets                              
    Cash and due from banks   $ 380,050     $ 329,003       15.5 %   $ 313,079       21.4 %
    Securities available for sale, at fair value     918,094       907,011       1.2 %     877,638       4.6 %
    Loans held for sale, at the lower of cost or fair value     49,611       11,831       319.3 %     10,467       374.0 %
    Loans receivable, net of allowance for credit losses     6,239,201       6,211,592       0.4 %     6,108,630       2.1 %
    Accrued interest receivable     23,749       23,536       0.9 %     23,958       -0.9 %
    Premises and equipment, net     20,607       20,866       -1.2 %     21,955       -6.1 %
    Customers’ liability on acceptances     214       552       -61.2 %     551       -61.2 %
    Servicing assets     6,420       6,422       0.0 %     6,836       -6.1 %
    Goodwill and other intangible assets, net     11,031       11,031       0.0 %     11,048       -0.2 %
    Federal Home Loan Bank (“FHLB”) stock, at cost     16,385       16,385       0.0 %     16,385       0.0 %
    Bank-owned life insurance     56,985       57,476       -0.9 %     56,534       0.8 %
    Prepaid expenses and other assets     140,016       133,330       5.0 %     139,266       0.5 %
    Total assets   $ 7,862,363     $ 7,729,035       1.7 %   $ 7,586,347       3.6 %
                                   
    Liabilities and Stockholders’ Equity                              
    Liabilities:                              
    Deposits:                              
    Noninterest-bearing   $ 2,105,369     $ 2,066,659       1.9 %   $ 1,959,963       7.4 %
    Interest-bearing     4,623,753       4,552,816       1.6 %     4,369,377       5.8 %
    Total deposits     6,729,122       6,619,475       1.7 %     6,329,340       6.3 %
    Accrued interest payable     30,567       29,646       3.1 %     47,699       -35.9 %
    Bank’s liability on acceptances     214       552       -61.2 %     551       -61.2 %
    Borrowings     127,500       117,500       8.5 %     292,500       -56.4 %
    Subordinated debentures     130,960       130,799       0.1 %     130,318       0.5 %
    Accrued expenses and other liabilities     81,166       79,578       2.0 %     78,880       2.9 %
    Total liabilities     7,099,529       6,977,550       1.7 %     6,879,288       3.2 %
                                   
    Stockholders’ equity:                              
    Common stock     34       34       0.0 %     34       0.0 %
    Additional paid-in capital     592,825       591,942       0.1 %     588,647       0.7 %
    Accumulated other comprehensive (loss)     (54,511 )     (60,002 )     9.2 %     (78,000 )     30.1 %
    Retained earnings     367,251       360,289       1.9 %     333,392       10.2 %
    Less treasury stock     (142,765 )     (140,778 )     -1.4 %     (137,014 )     -4.2 %
    Total stockholders’ equity     762,834       751,485       1.5 %     707,059       7.9 %
    Total liabilities and stockholders’ equity   $ 7,862,363     $ 7,729,035       1.7 %   $ 7,586,347       3.6 %

    Hanmi Financial Corporation and Subsidiaries
    Consolidated Statements of Income (Unaudited)
    (Dollars in thousands, except share and per share data)

        Three Months Ended  
        June 30,     March 31,     Percentage     June 30,     Percentage  
        2025     2025     Change     2024     Change  
    Interest and dividend income:                              
    Interest and fees on loans receivable   $ 92,589     $ 90,887       1.9 %   $ 90,752       2.0 %
    Interest on securities     6,261       6,169       1.5 %     5,238       19.5 %
    Dividends on FHLB stock     354       360       -1.7 %     357       -0.8 %
    Interest on deposits in other banks     2,129       1,841       15.6 %     2,313       -8.0 %
    Total interest and dividend income     101,333       99,257       2.1 %     98,660       2.7 %
    Interest expense:                              
    Interest on deposits     41,924       40,559       3.4 %     46,495       -9.8 %
    Interest on borrowings     684       2,024       -66.2 %     1,896       -63.9 %
    Interest on subordinated debentures     1,586       1,582       0.3 %     1,649       -3.8 %
    Total interest expense     44,194       44,165       0.1 %     50,040       -11.7 %
    Net interest income before credit loss expense     57,139       55,092       3.7 %     48,620       17.5 %
    Credit loss expense     7,631       2,721       180.4 %     961       694.1 %
    Net interest income after credit loss expense     49,508       52,371       -5.5 %     47,659       3.9 %
    Noninterest income:                              
    Service charges on deposit accounts     2,169       2,217       -2.2 %     2,429       -10.7 %
    Trade finance and other service charges and fees     1,461       1,396       4.7 %     1,277       14.4 %
    Gain on sale of Small Business Administration (“SBA”) loans     2,160       2,000       8.0 %     1,644       31.4 %
    Other operating income     2,281       2,113       8.0 %     2,707       -15.7 %
    Total noninterest income     8,071       7,726       4.5 %     8,057       0.2 %
    Noninterest expense:                              
    Salaries and employee benefits     22,069       20,972       5.2 %     20,434       8.0 %
    Occupancy and equipment     4,344       4,450       -2.4 %     4,607       -5.7 %
    Data processing     3,727       3,787       -1.6 %     3,686       1.1 %
    Professional fees     1,725       1,468       17.5 %     1,749       -1.4 %
    Supplies and communications     515       517       -0.4 %     570       -9.6 %
    Advertising and promotion     798       585       36.4 %     669       19.3 %
    Other operating expenses     3,169       3,205       -1.1 %     3,561       -11.0 %
    Total noninterest expense     36,347       34,984       3.9 %     35,276       3.0 %
    Income before tax     21,232       25,113       -15.5 %     20,440       3.9 %
    Income tax expense     6,115       7,441       -17.8 %     5,989       2.1 %
    Net income   $ 15,117     $ 17,672       -14.5 %   $ 14,451       4.6 %
                                   
    Basic earnings per share:   $ 0.50     $ 0.59           $ 0.48        
    Diluted earnings per share:   $ 0.50     $ 0.58           $ 0.48        
                                   
    Weighted-average shares outstanding:                              
    Basic     29,948,836       29,937,660             30,055,913        
    Diluted     30,054,456       30,058,248             30,133,646        
    Common shares outstanding     30,176,568       30,233,514             30,272,110        

    Hanmi Financial Corporation and Subsidiaries
    Consolidated Statements of Income (Unaudited)
    (Dollars in thousands, except share and per share data)

        Six Months Ended  
        June 30,     June 30,     Percentage  
        2025     2024     Change  
    Interest and dividend income:                  
    Interest and fees on loans receivable   $ 183,476     $ 182,427       0.6 %
    Interest on securities     12,430       10,193       21.9 %
    Dividends on FHLB stock     714       719       -0.7 %
    Interest on deposits in other banks     3,969       4,914       -19.2 %
    Total interest and dividend income     200,589       198,253       1.2 %
    Interest expense:                  
    Interest on deposits     82,483       92,133       -10.5 %
    Interest on borrowings     2,708       3,551       -23.7 %
    Interest on subordinated debentures     3,167       3,295       -3.9 %
    Total interest expense     88,358       98,979       -10.7 %
    Net interest income before credit loss expense     112,231       99,274       13.1 %
    Credit loss expense     10,352       1,188       771.4 %
    Net interest income after credit loss expense     101,879       98,086       3.9 %
    Noninterest income:                  
    Service charges on deposit accounts     4,387       4,878       -10.1 %
    Trade finance and other service charges and fees     2,858       2,691       6.2 %
    Gain on sale of Small Business Administration (“SBA”) loans     4,161       3,126       33.1 %
    Other operating income     4,390       5,095       -13.8 %
    Total noninterest income     15,796       15,790       0.0 %
    Noninterest expense:                  
    Salaries and employee benefits     43,041       42,019       2.4 %
    Occupancy and equipment     8,794       9,144       -3.8 %
    Data processing     7,514       7,237       3.8 %
    Professional fees     3,194       3,642       -12.3 %
    Supplies and communications     1,031       1,172       -12.0 %
    Advertising and promotion     1,382       1,576       -12.3 %
    Other operating expenses     6,374       6,930       -8.0 %
    Total noninterest expense     71,330       71,720       -0.5 %
    Income before tax     46,345       42,156       9.9 %
    Income tax expense     13,556       12,541       8.1 %
    Net income   $ 32,789     $ 29,615       10.7 %
                       
    Basic earnings per share:   $ 1.09     $ 0.98        
    Diluted earnings per share:   $ 1.08     $ 0.97        
                       
    Weighted-average shares outstanding:                  
    Basic     29,943,279       30,089,341        
    Diluted     30,048,704       30,166,181        
    Common shares outstanding     30,176,568       30,272,110        

    Hanmi Financial Corporation and Subsidiaries
    Average Balance, Average Yield Earned, and Average Rate Paid (Unaudited)
    (Dollars in thousands)

        Three Months Ended  
        June 30, 2025     March 31, 2025     June 30, 2024  
              Interest     Average           Interest     Average           Interest     Average  
        Average     Income /     Yield /     Average     Income /     Yield /     Average     Income /     Yield /  
        Balance     Expense     Rate     Balance     Expense     Rate     Balance     Expense     Rate  
    Assets                                                      
    Interest-earning assets:                                                      
    Loans receivable (1)   $ 6,257,741     $ 92,589       5.93 %   $ 6,189,531     $ 90,887       5.95 %   $ 6,089,440     $ 90,752       5.99 %
    Securities (2)     993,975       6,261       2.55 %     1,001,499       6,169       2.49 %     979,671       5,238       2.17 %
    FHLB stock     16,385       354       8.65 %     16,385       360       8.92 %     16,385       357       8.77 %
    Interest-bearing deposits in other banks     200,266       2,129       4.26 %     176,028       1,841       4.24 %     180,177       2,313       5.16 %
    Total interest-earning assets     7,468,367       101,333       5.44 %     7,383,443       99,257       5.45 %     7,265,673       98,660       5.46 %
                                                           
    Noninterest-earning assets:                                                      
    Cash and due from banks     53,977                   53,670                   55,442              
    Allowance for credit losses     (70,222 )                 (69,648 )                 (67,908 )            
    Other assets     250,241                   249,148                   252,410              
                                                           
    Total assets   $ 7,702,363                 $ 7,616,613                 $ 7,505,617              
                                                           
    Liabilities and Stockholders’ Equity                                                      
    Interest-bearing liabilities:                                                      
    Deposits:                                                      
    Demand: interest-bearing   $ 81,308     $ 29       0.15 %   $ 79,369     $ 27       0.14 %   $ 85,443     $ 32       0.15 %
    Money market and savings     2,109,221       17,342       3.30 %     2,037,224       16,437       3.27 %     1,845,870       17,324       3.77 %
    Time deposits     2,434,659       24,553       4.05 %     2,345,346       24,095       4.17 %     2,453,154       29,139       4.78 %
    Total interest-bearing deposits     4,625,188       41,924       3.64 %     4,461,939       40,559       3.69 %     4,384,467       46,495       4.27 %
    Borrowings     60,134       684       4.58 %     179,444       2,024       4.57 %     169,525       1,896       4.50 %
    Subordinated debentures     130,880       1,586       4.84 %     130,718       1,582       4.84 %     130,239       1,649       5.07 %
    Total interest-bearing liabilities     4,816,202       44,194       3.68 %     4,772,101       44,165       3.75 %     4,684,231       50,040       4.30 %
                                                           
    Noninterest-bearing liabilities and equity:                                                      
    Demand deposits: noninterest-bearing     1,934,985                   1,895,953                   1,883,765              
    Other liabilities     140,053                   144,654                   162,543              
    Stockholders’ equity     811,123                   803,905                   775,078              
                                                           
    Total liabilities and stockholders’ equity   $ 7,702,363                 $ 7,616,613                 $ 7,505,617              
                                                           
    Net interest income         $ 57,139                 $ 55,092                 $ 48,620        
                                                           
    Cost of deposits                 2.56 %                 2.59 %                 2.98 %
    Net interest spread (taxable equivalent basis)                 1.76 %                 1.70 %                 1.16 %
    Net interest margin (taxable equivalent basis)                 3.07 %                 3.02 %                 2.69 %
                                                           
    (1) Includes average loans held for sale  
    (2) Income calculated on a fully taxable equivalent basis using the federal tax rate in effect for the periods presented.  

    Hanmi Financial Corporation and Subsidiaries
    Average Balance, Average Yield Earned, and Average Rate Paid (Unaudited)
    (Dollars in thousands)

        Six Months Ended  
        June 30, 2025     June 30, 2024  
              Interest     Average           Interest     Average  
        Average     Income /     Yield /     Average     Income /     Yield /  
        Balance     Expense     Rate     Balance     Expense     Rate  
    Assets                                    
    Interest-earning assets:                                    
    Loans receivable (1)   $ 6,223,825     $ 183,476       5.94 %   $ 6,113,664     $ 182,427       6.00 %
    Securities (2)     997,716       12,430       2.52 %     974,596       10,193       2.12 %
    FHLB stock     16,385       714       8.79 %     16,385       719       8.82 %
    Interest-bearing deposits in other banks     188,214       3,969       4.25 %     190,950       4,914       5.18 %
    Total interest-earning assets     7,426,140       200,589       5.44 %     7,295,595       198,253       5.46 %
                                         
    Noninterest-earning assets:                                    
    Cash and due from banks     53,824                   56,912              
    Allowance for credit losses     (69,936 )                 (68,507 )            
    Other assets     249,697                   248,555              
                                         
    Total assets   $ 7,659,725                 $ 7,532,555              
                                         
    Liabilities and Stockholders’ Equity                                    
    Interest-bearing liabilities:                                    
    Deposits:                                    
    Demand: interest-bearing   $ 80,344     $ 56       0.14 %   $ 85,922     $ 61       0.14 %
    Money market and savings     2,073,421       33,779       3.29 %     1,830,478       33,877       3.72 %
    Time deposits     2,390,249       48,648       4.10 %     2,480,492       58,195       4.72 %
    Total interest-bearing deposits     4,544,014       82,483       3.66 %     4,396,892       92,133       4.21 %
    Borrowings     119,460       2,708       4.57 %     165,972       3,551       4.30 %
    Subordinated debentures     130,799       3,167       4.84 %     130,163       3,295       5.06 %
    Total interest-bearing liabilities     4,794,273       88,358       3.72 %     4,693,027       98,979       4.24 %
                                         
    Noninterest-bearing liabilities and equity:                                    
    Demand deposits: noninterest-bearing     1,915,577                   1,902,477              
    Other liabilities     142,341                   163,533              
    Stockholders’ equity     807,534                   773,518              
                                         
    Total liabilities and stockholders’ equity   $ 7,659,725                 $ 7,532,555              
                                         
    Net interest income         $ 112,231                 $ 99,274        
                                         
    Cost of deposits                 2.58 %                 2.94 %
    Net interest spread (taxable equivalent basis)                 1.73 %                 1.22 %
    Net interest margin (taxable equivalent basis)                 3.05 %                 2.74 %
                                         
    (1) Includes average loans held for sale  
    (2) Amounts calculated on a fully taxable equivalent basis using the federal tax rate in effect for the periods presented.  


    Non-GAAP Financial Measures

    These disclosures should not be viewed as a substitute for results determined in accordance with GAAP, nor is it necessarily comparable to non-GAAP performance measures that may be presented by other companies.

    Tangible Common Equity to Tangible Assets Ratio

    Tangible common equity to tangible assets ratio is supplemental financial information determined by a method other than in accordance with U.S. generally accepted accounting principles (“GAAP”). This non-GAAP measure is used by management in the analysis of Hanmi’s capital strength. Tangible common equity is calculated by subtracting goodwill and other intangible assets from stockholders’ equity. Banking and financial institution regulators also exclude goodwill and other intangible assets from stockholders’ equity when assessing the capital adequacy of a financial institution. Management believes the presentation of this financial measure excluding the impact of these items provides useful supplemental information that is essential to a proper understanding of the capital strength of Hanmi.

    The following table reconciles this non-GAAP performance measure to the GAAP performance measure for the periods indicated:

    Tangible Common Equity to Tangible Assets Ratio (Unaudited)
    (In thousands, except share, per share data and ratios)

        June 30,     March 31,     December 31,     September 30,     June 30,  
    Hanmi Financial Corporation   2025     2025     2024     2024     2024  
    Assets   $ 7,862,363     $ 7,729,035     $ 7,677,925     $ 7,712,299     $ 7,586,347  
    Less goodwill and other intangible assets     (11,031 )     (11,031 )     (11,031 )     (11,031 )     (11,048 )
    Tangible assets   $ 7,851,332     $ 7,718,004     $ 7,666,894     $ 7,701,268     $ 7,575,299  
                                   
    Stockholders’ equity (1)   $ 762,834     $ 751,485     $ 732,174     $ 736,709     $ 707,059  
    Less goodwill and other intangible assets     (11,031 )     (11,031 )     (11,031 )     (11,031 )     (11,048 )
    Tangible stockholders’ equity (1)   $ 751,803     $ 740,454     $ 721,143     $ 725,678     $ 696,011  
                                   
    Stockholders’ equity to assets     9.70 %     9.72 %     9.54 %     9.55 %     9.32 %
    Tangible common equity to tangible assets (1)     9.58 %     9.59 %     9.41 %     9.42 %     9.19 %
                                   
    Common shares outstanding     30,176,568       30,233,514       30,195,999       30,196,755       30,272,110  
    Tangible common equity per common share   $ 24.91     $ 24.49     $ 23.88     $ 24.03     $ 22.99  
                                   
    (1) There were no preferred shares outstanding at the periods indicated.  


    Preprovision Net Revenue

    Preprovision net revenue is supplemental financial information determined by a method other than in accordance with U.S. GAAP. This non-GAAP measure is used by management to measure Hanmi’s core operational performance, excluding the impact of provisions for loan losses. By isolating preprovision net revenue, management can better understand the Company’s profitability and make more informed strategic decisions. Preprovision net revenue is calculated adding income tax expense and credit loss expense to net income. Management believes this financial measure highlights the Company’s net revenue activities and operational efficiency, excluding unpredictable credit loss expense.

    The following table details the Company’s preprovision net revenue, which are non-GAAP measures, for the periods indicated:

    Preprovision Net Revenue (Unaudited)
    (In thousands, except percentages)

                                      Percentage Change  
        June 30,     March 31,     December 31,     September 30,     June 30,     Q2-25     Q2-25  
    Hanmi Financial Corporation   2025     2025     2024     2024     2024     vs. Q1-25     vs. Q2-24  
    Net income   $ 15,117     $ 17,672     $ 17,695     $ 14,892     $ 14,451              
    Add back:                                          
    Credit loss expense     7,631       2,721       945       2,286       961              
    Income tax expense     6,115       7,441       7,632       6,231       5,989              
    Preprovision net revenue   $ 28,863     $ 27,834     $ 26,272     $ 23,409     $ 21,401       3.7 %     34.9 %

    The MIL Network –

  • MIL-OSI: Middlefield Banc Corp. Reports 2025 Six-Month Financial Results

    Source: GlobeNewswire (MIL-OSI)

    MIDDLEFIELD, Ohio, July 22, 2025 (GLOBE NEWSWIRE) — Middlefield Banc Corp. (NASDAQ: MBCN) today reported financial results for the six months ended June 30, 2025.

    2025 Second-Quarter Financial Highlights (on a year-over-year basis):

      ● Earnings per share increased 46.2% year-over-year to $0.76 per diluted share
      ● Asset quality improved from the 2024 fourth quarter with nonperforming assets to total assets decreasing by 32 basis points to 1.30%
      ● Net interest margin expanded 37 basis points to 3.88% and increased 19 basis points from the 2025 first quarter
      ● Total loans increased $84.2 million, or 5.6% to a record $1.58 billion
      ● Total assets increased $96.2 million, or 5.3% to a record $1.92 billion
      ● Book value increased 4.3% to $26.74 from $25.63 per share, while tangible book value(1) increased 6.1% to $21.60 from $20.37 per share

     (1) See non-GAAP reconciliation under the section “GAAP to Non-GAAP Reconciliations”

    “The second quarter of 2025 was another strong quarter of growth, profitability and value creation for Middlefield,” stated Ronald L. Zimmerly, Jr., President and Chief Executive Officer. “Total loans have increased at an 8.2% annualized rate since the beginning of the year to a record $1.58 billion, asset quality continued to improve sequentially, and our net interest margin for the second quarter of 2025 expanded 37 basis points year-over-year to 3.88%.  These results led to strong growth in profitability during the quarter.  Net income also benefited from a $1.2 million net gain on the exchange of real estate associated with the relocation of our Westerville, Ohio branch.  Relocating our Westerville office is a great opportunity, supported by favorable demographics and underscores our multi-year strategy to expand our presence in the Central Ohio region. We expect our new Westerville branch to open in the second half of 2025.”

    “I am pleased by the strong start to 2025 and the direction we are headed.  We remain focused on investing in our platform, which includes upgrades to our technology infrastructure, adding new, experienced commercial bankers, and pursuing opportunities to expand Middlefield across our compelling Ohio markets.  As a result of these efforts and the contributions of our high-performing team, we expect additional loan and core deposit growth to benefit profitability throughout the remainder of 2025,” concluded Mr. Zimmerly.

    Income Statement
    Net interest income for the 2025 second quarter increased 15.6% to $17.4 million, compared to $15.1 million for the 2024 second quarter. The net interest margin for the 2025 second quarter was 3.88%, compared to 3.51% for the same period of 2024. Net interest income for the six months ended June 30, 2025, increased 11.6% to $33.5 million, compared to $30.1 million for the same period last year. The increase was primarily due to strong loan growth, a decrease in FHLB advances, and an overall decline in rates for deposits. Net interest margin for the six months ended June 30, 2025, was 3.79%, compared to 3.53% last year. 

    Noninterest income for the 2025 second quarter was $3.1 million, compared to $1.8 million for the same period the previous year. For the six months ended June 30, 2025, noninterest income increased $1.5 million to $5.0 million, compared to $3.6 million for the same period in 2024.  In April 2025, Middlefield completed an exchange of real estate with the City of Westerville, Ohio for a parcel of land that had a fair value of $1.5 million. In exchange, Middlefield transferred land and a building with related furnishings associated with its current branch located in Westerville, Ohio. The transferred branch had a net book value of $221,000. The exchange of real estate transaction resulted in a one-time, non-cash gain of $1.2 million.

    For the 2025 second quarter, noninterest expense was $13.7 million, compared to $11.9 million for the 2024 second quarter. Noninterest expense for the six months ended June 30, 2025, was $25.8 million, compared to $23.9 million for the same period in 2024. Noninterest expense for the 2025 second quarter included a $700,000 loss associated with recording a separate property located in Westerville, Ohio as held for sale.     

    Net income for the 2025 second quarter was $6.2 million, or $0.76 per diluted share, compared to $4.2 million, or $0.52 per diluted share, for the same period last year. Net income for the six months ended June 30, 2025, was $11.0 million, or $1.36 per diluted share, compared to $8.3 million, or $1.03 per diluted share, for the same period last year. 

    For the 2025 second quarter, pre-tax, pre-provision net income was $6.9 million, compared to $4.9 million for the same period of 2024. For the six months ended June 30, 2025, pre-tax, pre-provision net income was $12.7 million, compared to $9.7 million for the same period last year.  (See non-GAAP reconciliation under the section “GAAP to Non-GAAP Reconciliations”.)

    Balance Sheet
    Total assets at June 30, 2025, increased 5.3% to a record $1.92 billion, compared to $1.83 billion at June 30, 2024. Total loans at June 30, 2025, were a record $1.58 billion, compared to $1.50 billion at June 30, 2024. The 5.6% year-over-year increase in total loans was primarily due to higher home equity lines of credit, commercial and industrial loans, residential real estate loans, non-owner occupied, and owner occupied loans, partially offset by a reduction in construction and other loans and multifamily loans.

    The investment securities available-for-sale portfolio was $161.1 million at June 30, 2025, compared with $166.4 million at June 30, 2024.

    Total liabilities at June 30, 2025, increased 5.4% to $1.71 billion, compared to $1.62 billion at June 30, 2024. Total deposits at June 30, 2025, were $1.59 billion, compared to $1.47 billion at June 30, 2024. The 8.4% year-over-year increase in deposits was primarily due to growth in money market and interest-bearing demand deposits, partially offset by declines in savings deposit accounts. Noninterest-bearing demand deposits were 24.2% of total deposits at June 30, 2025, compared to 26.3% at June 30, 2024. At June 30, 2025, the Company had brokered deposits of $165.1 million, compared to $86.5 million at June 30, 2024.

    Michael C. Ranttila, Chief Financial Officer, stated, “Middlefield’s highly profitable financial model, disciplined loan pricing, and strong liquidity levels provides us with the flexibility to support both loan and operational growth. We continue to monitor our funding mix to support our loan portfolio at a reasonable cost, and such actions contributed to a seven-basis point reduction in our cost of funds since the beginning of the year.  Throughout the second half of 2025, we are focused on growing core deposits by improving the mix of commercial and industrial loans and growing treasury management relationships.”

    Middlefield’s CRE portfolio included the following categories at June 30, 2025:

    (Dollar amounts in thousands)   Balance     Percent of
    CRE Portfolio    		     Percent of
    Loan Portfolio    		     Weighted Average
    Loan-to-Value    		  
                                     
    Multi-Family   $ 79,497       11.7 %     5.0 %     64.7 %
    Owner Occupied                                
    Real Estate and Rental and Leasing     56,806       8.3 %     3.6 %     55.6 %
    Other Services (except Public Administration)     40,734       6.0 %     2.6 %     58.2 %
    Manufacturing     17,919       2.6 %     1.1 %     44.4 %
    Agriculture, Forestry, Fishing and Hunting     12,318       1.8 %     0.8 %     36.3 %
    Educational Services     11,844       1.7 %     0.7 %     50.1 %
    Other     57,024       8.3 %     3.6 %     54.1 %
    Total Owner Occupied   $ 196,645       28.7 %     12.4 %        
    Non-Owner Occupied                                
    Real Estate and Rental and Leasing     333,645       49.0 %     21.1 %     54.8 %
    Accommodation and Food Services     40,430       5.9 %     2.6 %     57.0 %
    Health Care and Social Assistance     19,456       2.9 %     1.2 %     65.9 %
    Manufacturing     7,412       1.1 %     0.5 %     46.7 %
    Other     4,089       0.7 %     0.3 %     76.4 %
    Total Non-Owner Occupied   $ 405,032       59.6 %     25.7 %        
    Total CRE   $ 681,174       100.0 %     43.1 %        


    Stockholders’ Equity and Dividends
    At June 30, 2025, stockholders’ equity was $216.1 million, compared to $206.8 million at June 30, 2024. The 4.5% year-over-year increase in stockholders’ equity was primarily from higher retained earnings, partially offset by an increase in the unrealized losses on the available-for-sale investment portfolio. On a per-share basis, shareholders’ equity at June 30, 2025, was $26.74, compared to $25.63 at June 30, 2024.

    At June 30, 2025, tangible stockholders’ equity(1) was $174.6 million, compared to $164.3 million at June 30, 2024. On a per-share basis, tangible stockholders’ equity(1) was $21.60 at June 30, 2025, compared to $20.37 at June 30, 2024. (1)See non-GAAP reconciliation under the section “GAAP to Non-GAAP Reconciliations”.

    For the six months ended June 30, 2025, the Company declared cash dividends of $0.42 per share, totaling $3.4 million. Beginning in the first quarter of 2025, the Company increased the quarterly cash dividend by $0.01, or 5% from the previous year’s $0.20 per share quarterly cash dividend.  

    For the six months ended June 30, 2025, the Company did not repurchase any shares of its common stock.  

    At June 30, 2025, the Company’s equity-to-assets ratio was 11.23%, compared to 11.31% at June 30, 2024.

    Asset Quality
    For the six months ended June 30, 2025, the Company recorded a recovery of credit losses of $411,000, compared to a recovery of credit losses of $49,000 for the same period of 2024.  

    Net recoveries were $227,000, or (0.03%) of average loans, annualized, for the six months ended June 30, 2025, compared to net recoveries of $97,000, or (0.01%) of average loans, annualized, for the same period of 2024.      

    Nonperforming loans at June 30, 2025, were $25.1 million, compared to $16.0 million at June 30, 2024. The year-over-year increase in nonperforming assets was primarily due to a $12.0 million loan moved to nonaccrual in the 2024 third quarter. The allowance for credit losses at June 30, 2025, stood at $22.3 million, or 1.41% of total loans, compared to $21.8 million, or 1.46% of total loans at June 30, 2024. The increase in the allowance for credit losses was mainly from changes in projected loss drivers, prepayment assumptions, curtailment expectations over the reasonable and supportable forecast period, and geographic footprint of unemployment data, as well as an overall increase in total loans.

    Mr. Ranttila continued, “Asset quality demonstrates the success of our disciplined approach to credit quality and risk management, as nonperforming assets to total assets have improved to 1.30% at June 30, 2025, compared to 1.56% at March 31, 2025, and 1.62% at December 31, 2024.  Over the past six months, non-performing assets declined by $4.9 million from $30.0 million at December 31, 2024, primarily as a result of the successful payoff of one previously disclosed non-accruing loan.  In addition, reductions in the reserve against individually analyzed loans as well as the reserve for unfunded commitments drove a $506,000 recovery for credit losses in the second quarter. We continue to expect stable economic activity across our Central, Western and Northeast Ohio markets that will support loan demand and asset quality throughout 2025.” 

    About Middlefield Banc Corp.
    Middlefield Banc Corp., headquartered in Middlefield, Ohio, is the Bank holding Company of The Middlefield Banking Company, with total assets of $1.92 billion at June 30, 2025. The Bank operates 21 full-service banking centers and an LPL Financial® brokerage office serving Ada, Beachwood, Bellefontaine, Chardon, Cortland, Dublin, Garrettsville, Kenton, Mantua, Marysville, Middlefield, Newbury, Orwell, Plain City, Powell, Solon, Sunbury, Twinsburg, and Westerville. The Bank also operates a Loan Production Office in Mentor, Ohio.

    Additional information is available at www.middlefieldbank.bank

    NON-GAAP FINANCIAL MEASURES
    This press release includes disclosure of Middlefield Banc Corp.’s tangible book value per share, return on average tangible equity, and pre-tax, pre-provision for loan losses income, which are financial measures not prepared in accordance with generally accepted accounting principles in the United States (GAAP). A non-GAAP financial measure is a numerical measure of historical or future financial performance, financial position or cash flows that excludes or includes amounts required to be disclosed by GAAP. Middlefield Banc Corp. believes that these non-GAAP financial measures provide both management and investors a more complete understanding of the underlying operational results and trends and Middlefield Banc Corp.’s marketplace performance. The presentation of this additional information is not meant to be considered in isolation or as a substitute for the numbers prepared in accordance with GAAP. The reconciliations of non-GAAP financial measures are included in the following Consolidated Financial Highlights tables below.

    FORWARD-LOOKING STATEMENTS
    This press release of Middlefield Banc Corp. and the reports Middlefield Banc Corp. files with the Securities and Exchange Commission often contain “forward-looking statements” relating to present or future trends or factors affecting the banking industry and, specifically, the financial operations, markets and products of Middlefield Banc Corp. These forward-looking statements involve certain risks and uncertainties. There are several important factors that could cause Middlefield Banc Corp.’s future results to differ materially from historical performance or projected performance. These factors include, but are not limited to: (1) a significant increase in competitive pressures among financial institutions; (2) changes in the interest rate environment that may reduce interest margins; (3) changes in prepayment speeds, charge-offs and loan loss provisions; (4) less favorable than expected general economic conditions; (5) legislative or regulatory changes that may adversely affect businesses in which Middlefield Banc Corp. is engaged; (6) technological issues which may adversely affect Middlefield Banc Corp.’s financial operations or customers; (7) changes in the securities markets; or (8) risk factors mentioned in the reports and registration statements Middlefield Banc Corp. files with the Securities and Exchange Commission. Middlefield Banc Corp. undertakes no obligation to release revisions to these forward-looking statements or to reflect events or circumstances after the date of this press release.

    MIDDLEFIELD BANC CORP.
    Consolidated Selected Financial Highlights
    (Dollar amounts in thousands, unaudited)

        June 30,     March 31,     December 31,     September 30,     June 30,  
    Balance Sheets (period end)   2025     2025     2024     2024     2024  
    ASSETS                                        
    Cash and due from banks   $ 59,145     $ 56,150     $ 46,037     $ 61,851     $ 50,496  
    Federal funds sold     13,701       10,720       9,755       12,022       1,762  
    Cash and cash equivalents     72,846       66,870       55,792       73,873       52,258  
    Investment securities available for sale, at fair value     161,116       165,014       165,802       169,895       166,424  
    Other investments     1,014       1,021       855       895       881  
    Loans held for sale     152       –       –       249       –  
    Loans:                                        
    Commercial real estate:                                        
    Owner occupied     196,645       185,412       181,447       187,313       182,809  
    Non-owner occupied     405,032       413,621       412,291       407,159       385,648  
    Multifamily     79,497       88,737       89,849       94,798       86,951  
    Residential real estate     357,217       351,274       353,442       345,748       337,121  
    Commercial and industrial     257,519       235,547       229,034       213,172       234,702  
    Home equity lines of credit     156,297       147,154       143,379       137,761       131,047  
    Construction and other     123,531       122,653       103,608       111,550       132,530  
    Consumer installment     6,187       5,951       6,564       7,030       6,896  
    Total loans     1,581,925       1,550,349       1,519,614       1,504,531       1,497,704  
    Less allowance for credit losses     22,335       22,401       22,447       22,526       21,795  
    Net loans     1,559,590       1,527,948       1,497,167       1,482,005       1,475,909  
    Premises and equipment, net     20,304       20,494       20,565       20,528       20,744  
    Premises and equipment held for sale     1,015       –       –       –       –  
    Goodwill     36,356       36,356       36,356       36,356       36,356  
    Core deposit intangibles     5,112       5,362       5,611       5,869       6,126  
    Bank-owned life insurance     35,102       34,866       35,259       35,049       34,802  
    Accrued interest receivable and other assets     31,762       30,425       35,952       32,916       34,686  
    TOTAL ASSETS   $ 1,924,369     $ 1,888,356     $ 1,853,359     $ 1,857,635     $ 1,828,186  
        June 30,     March 31,     December 31,     September 30,     June 30,  
        2025     2025     2024     2024     2024  
    LIABILITIES                                        
    Deposits:                                        
    Noninterest-bearing demand   $ 386,248     $ 369,492     $ 377,875     $ 390,933     $ 387,024  
    Interest-bearing demand     221,146       222,953       208,291       218,002       206,542  
    Money market     466,935       481,664       414,074       376,619       355,630  
    Savings     184,534       189,943       197,749       199,984       192,472  
    Time     334,755       275,673       247,704       327,231       327,876  
    Total deposits     1,593,618       1,539,725       1,445,693       1,512,769       1,469,544  
    Federal Home Loan Bank advances     89,000       110,000       172,400       106,000       125,000  
    Other borrowings     11,557       11,609       11,660       11,711       11,762  
    Accrued interest payable and other liabilities     14,142       13,229       13,044       16,450       15,092  
    TOTAL LIABILITIES     1,708,317       1,674,563       1,642,797       1,646,930       1,621,398  
    STOCKHOLDERS’ EQUITY                                        
    Common stock, no par value; 25,000,000 shares authorized, 9,960,503 shares issued, 8,081,193 shares outstanding as of June 30, 2025     162,195       162,195       161,999       161,916       161,823  
    Additional paid-in capital     811       515       246       108       –  
    Retained earnings     116,892       112,432       109,299       106,067       105,342  
    Accumulated other comprehensive loss     (22,937 )     (20,440 )     (20,073 )     (16,477 )     (19,468 )
    Treasury stock, at cost; 1,879,310 shares as of June 30, 2025     (40,909 )     (40,909 )     (40,909 )     (40,909 )     (40,909 )
    TOTAL STOCKHOLDERS’ EQUITY     216,052       213,793       210,562       210,705       206,788  
                                             
    TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY   $ 1,924,369     $ 1,888,356     $ 1,853,359     $ 1,857,635     $ 1,828,186  


    MIDDLEFIELD BANC CORP.
    Consolidated Selected Financial Highlights
    (Dollar amounts in thousands, unaudited)

        For the Three Months Ended     For the Six Months Ended  
        June 30,     March 31,     December 31,     September 30,     June 30,     June 30,     June 30,  
    Statements of Income   2025     2025     2024     2024     2024     2025     2024  
                                                             
    INTEREST AND DIVIDEND INCOME                                                        
    Interest and fees on loans   $ 25,122     $ 23,387     $ 23,308     $ 23,441     $ 23,422     $ 48,509     $ 45,817  
    Interest-earning deposits in other institutions     325       291       320       348       386       616       823  
    Federal funds sold     120       155       151       143       122       275       274  
    Investment securities:                                                        
    Taxable interest     526       530       528       528       505       1,056       972  
    Tax-exempt interest     960       960       961       962       966       1,920       1,938  
    Dividends on stock     183       150       170       191       198       333       387  
    Total interest and dividend income     27,236       25,473       25,438       25,613       25,599       52,709       50,211  
    INTEREST EXPENSE                                                        
    Deposits     8,789       7,885       8,582       8,792       8,423       16,674       15,889  
    Short-term borrowings     870       1,347       1,128       1,575       1,920       2,217       3,913  
    Other borrowings     140       143       173       173       173       283       357  
    Total interest expense     9,799       9,375       9,883       10,540       10,516       19,174       20,159  
    NET INTEREST INCOME     17,437       16,098       15,555       15,073       15,083       33,535       30,052  
    Provision for (recovery of) credit losses     (506 )     95       (177 )     2,234       87       (411 )     (49 )
    NET INTEREST INCOME AFTER PROVISION                                                        
    FOR (RECOVERY OF) CREDIT LOSSES     17,943       16,003       15,732       12,839       14,996       33,946       30,101  
    NONINTEREST INCOME                                                        
    Service charges on deposit accounts     1,061       989       1,068       959       971       2,050       1,880  
    Gain (Loss) on equity securities     (7 )     (34 )     56       14       (27 )     (41 )     (79 )
    Earnings on bank-owned life insurance     230       493       230       246       227       723       454  
    Gain on sale of loans     39       24       64       56       69       63       79  
    Revenue from investment services     310       268       237       206       269       578       473  
    Gain on exchange of real estate     1,229       –       –       –       –       1,229       –  
    Gross rental income     –       –       –       –       –       –       67  
    Other income     216       204       259       262       251       420       682  
    Total noninterest income     3,078       1,944       1,914       1,743       1,760       5,022       3,556  
                                                             
    NONINTEREST EXPENSE                                                        
    Salaries and employee benefits     6,734       6,557       5,996       6,201       6,111       13,291       12,444  
    Occupancy expense     667       687       596       627       601       1,354       1,153  
    Equipment expense     248       225       221       203       261       473       501  
    Data processing costs     1,273       1,271       1,174       1,214       1,135       2,544       2,417  
    Ohio state franchise tax     399       399       390       399       397       798       794  
    Federal deposit insurance expense     267       267       293       255       256       534       507  
    Professional fees     521       598       611       539       557       1,119       1,115  
    Advertising expense     451       364       371       283       508       815       927  
    Software amortization expense     95       90       83       74       21       185       43  
    Core deposit intangible amortization     250       249       258       257       258       499       516  
    Loss on premises and equipment held for sale     693       –       –       –       –       693       –  
    Gross other real estate owned expenses     –       –       –       –       –       –       99  
    Other expense     2,053       1,486       1,810       1,819       1,797       3,539       3,351  
    Total noninterest expense     13,651       12,193       11,803       11,871       11,902       25,844       23,867  
                                                             
    Income before income taxes     7,370       5,754       5,843       2,711       4,854       13,124       9,790  
    Income taxes     1,213       924       995       371       690       2,137       1,459  
                                                             
    NET INCOME   $ 6,157     $ 4,830     $ 4,848     $ 2,340     $ 4,164     $ 10,987     $ 8,331  
                                                             
    PTPP (1)   $ 6,864     $ 5,849     $ 5,666     $ 4,945     $ 4,941     $ 12,713     $ 9,741  
    (1)  See section “GAAP to Non-GAAP Reconciliations” for the reconciliation of GAAP performance measures to non-GAAP measures.


    MIDDLEFIELD BANC CORP.
    Consolidated Selected Financial Highlights
    (Dollar amounts in thousands, except per share and share amounts, unaudited)

        For the Three Months Ended     For the Six Months Ended  
        June 30,     March 31,     December 31,     September 30,     June 30,     June 30,     June 30,  
        2025     2025     2024     2024     2024     2025     2024  
    Per common share data                                                        
    Net income per common share – basic   $ 0.76     $ 0.60     $ 0.60     $ 0.29     $ 0.52     $ 1.36     $ 1.04  
    Net income per common share – diluted   $ 0.76     $ 0.60     $ 0.60     $ 0.29     $ 0.52     $ 1.36     $ 1.03  
    Dividends declared per share   $ 0.21     $ 0.21     $ 0.20     $ 0.20     $ 0.20     $ 0.42     $ 0.40  
    Book value per share (period end)   $ 26.74     $ 26.46     $ 26.08     $ 26.11     $ 25.63     $ 26.74     $ 25.63  
    Tangible book value per share (period end) (1) (2)   $ 21.60     $ 21.29     $ 20.88     $ 20.87     $ 20.37     $ 21.60     $ 20.37  
    Dividends declared   $ 1,697     $ 1,697     $ 1,616     $ 1,615     $ 1,613     $ 3,394     $ 3,226  
    Dividend yield     2.80 %     3.05 %     2.84 %     2.76 %     3.34 %     2.81 %     3.34 %
    Dividend payout ratio     27.56 %     35.13 %     33.33 %     69.02 %     38.74 %     30.89 %     38.72 %
    Average shares outstanding – basic     8,081,193       8,078,805       8,071,905       8,071,032       8,067,144       8,080,006       8,079,174  
    Average shares outstanding – diluted     8,113,572       8,097,545       8,092,357       8,086,872       8,072,499       8,107,066       8,084,529  
    Period ending shares outstanding     8,081,193       8,081,193       8,073,708       8,071,032       8,067,144       8,081,193       8,067,144  
                                                             
    Selected ratios                                                        
    Return on average assets (Annualized)     1.29 %     1.04 %     1.04 %     0.50 %     0.91 %     1.17 %     0.91 %
    Return on average equity (Annualized)     11.53 %     9.22 %     9.19 %     4.45 %     8.15 %     10.39 %     8.16 %
    Return on average tangible common equity (1) (3)     14.31 %     11.48 %     11.50 %     5.58 %     10.29 %     12.92 %     10.30 %
    Efficiency (4)     64.49 %     65.22 %     65.05 %     67.93 %     67.97 %     64.83 %     68.32 %
    Equity to assets at period end     11.23 %     11.32 %     11.36 %     11.34 %     11.31 %     11.23 %     11.31 %
    Noninterest expense to average assets     0.72 %     0.65 %     0.63 %     0.66 %     0.64 %     1.36 %     1.30 %
    (1)  See section “GAAP to Non-GAAP Reconciliations” for the reconciliation of GAAP performance measures to non-GAAP measures.
    (2)  Calculated by dividing tangible common equity by shares outstanding.
    (3)  Calculated by dividing annualized net income for each period by average tangible common equity.
    (4)  The efficiency ratio is calculated by dividing noninterest expense less amortization of intangibles by the sum of net interest income on a fully taxable equivalent basis plus noninterest income.
        For the Three Months Ended     For the Six Months Ended  
        June 30,     March 31,     December 31,     September 30,     June 30,     June 30,     June 30,  
    Yields   2025     2025     2024     2024     2024     2025     2024  
    Interest-earning assets:                                                        
    Loans receivable (1)     6.40 %     6.17 %     6.12 %     6.19 %     6.27 %     6.29 %     6.19 %
    Investment securities (1) (2)     3.64 %     3.69 %     3.63 %     3.62 %     3.59 %     3.67 %     3.56 %
    Interest-earning deposits with other banks     4.13 %     3.57 %     4.23 %     4.27 %     4.59 %     3.84 %     4.74 %
    Total interest-earning assets     6.03 %     5.81 %     5.78 %     5.84 %     5.92 %     5.92 %     5.85 %
    Deposits:                                                        
    Interest-bearing demand deposits     2.49 %     2.13 %     2.07 %     2.16 %     1.93 %     2.31 %     1.90 %
    Money market deposits     3.53 %     3.38 %     3.81 %     3.93 %     3.95 %     3.46 %     3.88 %
    Savings deposits     0.86 %     0.82 %     0.75 %     0.71 %     0.64 %     0.84 %     0.61 %
    Certificates of deposit     3.66 %     3.93 %     4.21 %     4.49 %     4.57 %     3.79 %     4.32 %
    Total interest-bearing deposits     2.95 %     2.82 %     3.05 %     3.17 %     3.15 %     2.89 %     3.02 %
    Non-Deposit Funding:                                                        
    Borrowings     4.54 %     4.58 %     4.93 %     5.54 %     5.60 %     4.56 %     5.60 %
    Total interest-bearing liabilities     3.06 %     3.01 %     3.21 %     3.41 %     3.45 %     3.04 %     3.34 %
    Cost of deposits     2.21 %     2.10 %     2.24 %     2.33 %     2.30 %     2.16 %     2.19 %
    Cost of funds     2.34 %     2.30 %     2.41 %     2.58 %     2.61 %     2.32 %     2.52 %
    Net interest margin (3)     3.88 %     3.69 %     3.56 %     3.46 %     3.51 %     3.79 %     3.53 %
    (1)  Tax-equivalent adjustments to calculate the yield on tax-exempt securities and loans were determined using an effective tax rate of 21%.
    (2)  Yield is calculated on the basis of amortized cost.
    (3)  Net interest margin represents net interest income as a percentage of average interest-earning assets.


    MIDDLEFIELD BANC CORP.
    Consolidated Selected Financial Highlights
    (unaudited)

        For the Three Months Ended  
        June 30,     March 31,     December 31,     September 30,     June 30,  
    Asset quality data   2025     2025     2024     2024     2024  
    (Dollar amounts in thousands, unaudited)                                        
    Nonperforming assets (1)   $ 25,052     $ 29,550     $ 29,984     $ 30,078     $ 15,961  
                                             
    Allowance for credit losses   $ 22,335     $ 22,401     $ 22,447     $ 22,526     $ 21,795  
    Allowance for credit losses/total loans     1.41 %     1.44 %     1.48 %     1.50 %     1.46 %
    Net charge-offs (recoveries):                                        
    Quarter-to-date   $ (18 )   $ (209 )   $ 151     $ 1,382     $ (29 )
    Year-to-date     (227 )     (209 )     1,436       1,285       (97 )
    Net charge-offs (recoveries) to average loans, annualized:                                        
    Quarter-to-date     (0.00 %)     (0.06 %)     0.04 %     0.36 %     (0.01 %)
    Year-to-date     (0.03 %)     (0.06 %)     0.10 %     0.11 %     (0.01 %)
                                             
    Nonperforming loans/total loans     1.58 %     1.91 %     1.97 %     2.00 %     1.07 %
    Allowance for credit losses/nonperforming loans     89.15 %     75.81 %     74.86 %     74.89 %     136.55 %
    Nonperforming assets/total assets     1.30 %     1.56 %     1.62 %     1.62 %     0.87 %
    (1) Nonperforming assets consist of nonperforming loans.


    MIDDLEFIELD BANC CORP.
    GAAP to Non-GAAP Reconciliations

    Reconciliation of Common Stockholders’ Equity to Tangible Common Equity   For the Three Months Ended  
    (Dollar amounts in thousands, unaudited)   June 30,     March 31,     December 31,     September 30,     June 30,  
        2025     2025     2024     2024     2024  
                                             
    Stockholders’ equity   $ 216,052     $ 213,793     $ 210,562     $ 210,705     $ 206,788  
    Less goodwill and other intangibles     41,468       41,718       41,967       42,225       42,482  
    Tangible common equity   $ 174,584     $ 172,075     $ 168,595     $ 168,480     $ 164,306  
                                             
    Shares outstanding     8,081,193       8,081,193       8,073,708       8,071,032       8,067,144  
    Tangible book value per share   $ 21.60     $ 21.29     $ 20.88     $ 20.87     $ 20.37  

    Reconciliation of Average Equity to Return on Average Tangible Common Equity    		   For the Three Months Ended     For the Six Months Ended  
                                                             
        June 30,     March 31,     December 31,     September 30,     June 30,     June 30,     June 30,  
        2025     2025     2024     2024     2024     2025     2024  
                                                             
    Average stockholders’ equity   $ 214,144     $ 212,465     $ 209,864     $ 209,096     $ 205,379     $ 213,235     $ 205,330  
    Less average goodwill and other intangibles     41,589       41,839       42,092       42,350       42,607       41,714       42,609  
    Average tangible common equity   $ 172,555     $ 170,626     $ 167,772     $ 166,746     $ 162,772     $ 171,521     $ 162,721  
                                                             
    Net income   $ 6,157     $ 4,830     $ 4,848     $ 2,340     $ 4,164     $ 10,987     $ 8,331  
    Return on average tangible common equity (annualized)     14.31 %     11.48 %     11.50 %     5.58 %     10.29 %     12.92 %     10.30 %

    Reconciliation of Pre-Tax Pre-Provision Income (PTPP)    		   For the Three Months Ended     For the Six Months Ended  
                                                             
        June 30,     March 31,     December 31,     September 30,     June 30,     June 30,     June 30,  
        2025     2025     2024     2024     2024     2025     2024  
                                                             
    Net income   $ 6,157     $ 4,830     $ 4,848     $ 2,340     $ 4,164     $ 10,987     $ 8,331  
    Add income taxes     1,213       924       995       371       690       2,137       1,459  
    Add provision for (recovery of) credit losses     (506 )     95       (177 )     2,234       87       (411 )     (49 )
    PTPP   $ 6,864     $ 5,849     $ 5,666     $ 4,945     $ 4,941     $ 12,713     $ 9,741  


    MIDDLEFIELD BANC CORP.
    Average Balance Sheets
    (Dollar amounts in thousands, unaudited)

        For the Three Months Ended  
        June 30,     June 30,  
        2025     2024  
        Average             Average     Average             Average  
        Balance     Interest     Yield/Cost     Balance     Interest     Yield/Cost  
    Interest-earning assets:                                                
    Loans receivable (1)   $ 1,576,050     $ 25,122       6.40 %   $ 1,503,440     $ 23,422       6.27 %
    Investment securities (1) (2)     191,619       1,486       3.64 %     191,752       1,471       3.62 %
    Interest-earning deposits with other banks (3)     61,012       628       4.13 %     61,891       706       4.59 %
    Total interest-earning assets     1,828,681       27,236       6.03 %     1,757,083       25,599       5.93 %
    Noninterest-earning assets     79,414                       86,431                  
    Total assets   $ 1,908,095                     $ 1,843,514                  
    Interest-bearing liabilities:                                                
    Interest-bearing demand deposits   $ 217,859     $ 1,353       2.49 %   $ 209,965     $ 1,009       1.93 %
    Money market deposits     489,525       4,313       3.53 %     337,937       3,320       3.95 %
    Savings deposits     188,999       404       0.86 %     192,577       305       0.64 %
    Certificates of deposit     297,727       2,719       3.66 %     333,542       3,789       4.57 %
    Short-term borrowings     77,666       870       4.49 %     138,656       1,920       5.57 %
    Other borrowings     11,588       140       4.85 %     11,791       173       5.90 %
    Total interest-bearing liabilities     1,283,364       9,799       3.06 %     1,224,468       10,516       3.45 %
    Noninterest-bearing liabilities:                                                
    Noninterest-bearing demand deposits     397,493                       396,626                  
    Other liabilities     13,094                       17,042                  
    Stockholders’ equity     214,144                       205,379                  
    Total liabilities and stockholders’ equity   $ 1,908,095                     $ 1,843,514                  
    Net interest income           $ 17,437                     $ 15,083          
    Interest rate spread (4)                     2.97 %                     2.48 %
    Net interest margin (5)                     3.88 %                     3.52 %
    Ratio of average interest-earning assets to average interest-bearing liabilities                     142.49 %                     143.50 %
    (1) Tax-equivalent adjustments to calculate the yield on tax-exempt securities and loans were $266 and  $289 for the three months ended June 30, 2025 and 2024, respectively.
    (2) Yield is calculated on the basis of amortized cost.
    (3) Includes dividends received on restricted stock.
    (4) Interest rate spread represents the difference between the average yield on interest-earning assets and the average cost of interest-bearing liabilities.
    (5) Net interest margin represents net interest income as a percentage of average interest-earning assets.
        For the Three Months Ended  
        June 30,     March 31,  
        2025     2025  
        Average             Average     Average             Average  
        Balance     Interest     Yield/Cost     Balance     Interest     Yield/Cost  
    Interest-earning assets:                                                
    Loans receivable (1)   $ 1,576,050     $ 25,122       6.40 %   $ 1,537,337     $ 23,387       6.17 %
    Investment securities (1) (2)     191,619       1,486       3.64 %     191,996       1,490       3.69 %
    Interest-earning deposits with other banks (3)     61,012       628       4.13 %     67,661       596       3.57 %
    Total interest-earning assets     1,828,681       27,236       6.03 %     1,796,994       25,473       5.81 %
    Noninterest-earning assets     79,414                       84,542                  
    Total assets   $ 1,908,095                     $ 1,881,536                  
    Interest-bearing liabilities:                                                
    Interest-bearing demand deposits   $ 217,859     $ 1,353       2.49 %   $ 220,192     $ 1,154       2.13 %
    Money market deposits     489,525       4,313       3.53 %     458,446       3,816       3.38 %
    Savings deposits     188,999       404       0.86 %     192,931       388       0.82 %
    Certificates of deposit     297,727       2,719       3.66 %     261,006       2,527       3.93 %
    Short-term borrowings     77,666       870       4.49 %     120,238       1,347       4.54 %
    Other borrowings     11,588       140       4.85 %     11,639       143       4.98 %
    Total interest-bearing liabilities     1,283,364       9,799       3.06 %     1,264,452       9,375       3.01 %
    Noninterest-bearing liabilities:                                                
    Noninterest-bearing demand deposits     397,493                       390,354                  
    Other liabilities     13,094                       14,265                  
    Stockholders’ equity     214,144                       212,465                  
    Total liabilities and stockholders’ equity   $ 1,908,095                     $ 1,881,536                  
    Net interest income           $ 17,437                     $ 16,098          
    Interest rate spread (4)                     2.97 %                     2.80 %
    Net interest margin (5)                     3.88 %                     3.69 %
    Ratio of average interest-earning assets to average interest-bearing liabilities                     142.49 %                     142.12 %
    (1)  Tax-equivalent adjustments to calculate the yield on tax-exempt securities and loans were $266 and $272 for the three months ended June 30, 2025 and March 31, 2025, respectively.
    (2) Yield is calculated on the basis of amortized cost.
    (3) Includes dividends received on restricted stock.
    (4) Interest rate spread represents the difference between the average yield on interest-earning assets and the average cost of interest-bearing liabilities.
    (5) Net interest margin represents net interest income as a percentage of average interest-earning assets.
        For the Six Months Ended  
        June 30,     June 30,  
        2025     2024  
        Average             Average     Average             Average  
        Balance     Interest     Yield/Cost     Balance     Interest     Yield/Cost  
    Interest-earning assets:                                                
    Loans receivable (1)   $ 1,556,693     $ 48,509       6.29 %   $ 1,489,992     $ 45,817       6.19 %
    Investment securities (1) (2)     191,807       2,976       3.67 %     191,801       2,910       3.59 %
    Interest-earning deposits with other banks (3)     64,336       1,224       3.84 %     63,015       1,484       4.74 %
    Total interest-earning assets     1,812,836       52,709       5.92 %     1,744,808       50,211       5.85 %
    Noninterest-earning assets     81,979                       88,291                  
    Total assets   $ 1,894,815                     $ 1,833,099                  
    Interest-bearing liabilities:                                                
    Interest-bearing demand deposits   $ 219,026     $ 2,506       2.31 %   $ 210,487     $ 1,986       1.90 %
    Money market deposits     473,985       8,130       3.46 %     318,208       6,147       3.88 %
    Savings deposits     190,965       792       0.84 %     196,828       594       0.61 %
    Certificates of deposit     279,366       5,246       3.79 %     333,706       7,162       4.32 %
    Short-term borrowings     98,952       2,217       4.52 %     141,507       3,913       5.56 %
    Other borrowings     11,614       283       4.91 %     11,815       357       6.08 %
    Total interest-bearing liabilities     1,273,908       19,174       3.04 %     1,212,551       20,159       3.34 %
    Noninterest-bearing liabilities:                                                
    Noninterest-bearing demand deposits     393,923                       398,417                  
    Other liabilities     13,749                       16,801                  
    Stockholders’ equity     213,235                       205,330                  
    Total liabilities and stockholders’ equity   $ 1,894,815                     $ 1,833,099                  
    Net interest income           $ 33,535                     $ 30,052          
    Interest rate spread (4)                     2.88 %                     2.51 %
    Net interest margin (5)                     3.79 %                     3.53 %
    Ratio of average interest-earning assets to average interest-bearing liabilities                     142.31 %                     143.90 %
    (1)  Tax-equivalent adjustments to calculate the yield on tax-exempt securities and loans were $538 and $570 for the six months ended June 30, 2025 and June 30, 2024, respectively.
    (2) Yield is calculated on the basis of amortized cost.
    (3) Includes dividends received on restricted stock.
    (4) Interest rate spread represents the difference between the average yield on interest-earning assets and the average cost of interest-bearing liabilities.
    (5) Net interest margin represents net interest income as a percentage of average interest-earning assets.
       
    Company Contact: Investor and Media Contact:
    Ronald L. Zimmerly, Jr.
    President and Chief Executive Officer
    Middlefield Banc Corp.
    (419) 673-1217
    rzimmerly@middlefieldbank.com     		 Andrew M. Berger
    Managing Director
    SM Berger & Company, Inc.
    (216) 464-6400
    andrew@smberger.com 

    The MIL Network –

  • MIL-OSI: Vicor Corporation Reports Results for the Second Quarter Ended June 30, 2025

    Source: GlobeNewswire (MIL-OSI)

    ANDOVER, Mass., July 22, 2025 (GLOBE NEWSWIRE) — Vicor Corporation (NASDAQ: VICR) today reported financial results for the second quarter ended June 30, 2025. These results will be discussed later today at 5:00 p.m. Eastern Time, during management’s quarterly investor conference call. The details for the call are below.

    Product revenues, licensing income and a patent litigation settlement for the second quarter ended June 30, 2025 totaled $141.0 million, a 64.3% increase from $85.9 million for the corresponding period a year ago, and a 50.1% sequential increase from $94.0 million in the first quarter of 2025.

    Gross margin increased to $92.1 million for the second quarter of 2025, compared to $42.8 million for the corresponding period a year ago, and increased sequentially from $44.4 million for the first quarter of 2025. Gross margin, as a percentage of revenue, increased to 65.3% for the second quarter of 2025, compared to 49.8% for the corresponding period a year ago, and increased from 47.2% for the first quarter of 2025. Operating expenses increased to $46.7 million for the second quarter of 2025, compared to $42.6 million for the corresponding period a year ago, and increased sequentially from $44.5 million for the first quarter of 2025.

    Net income for the second quarter was $41.2 million, or $0.91 per diluted share, compared to a net loss of ($1.2) million or ($0.03) per diluted share, for the corresponding period a year ago and net income of $2.5 million, or $0.06 per diluted share, for the first quarter of 2025.

    Cash flow from operations totaled $65.2 million for the second quarter, compared to cash flow from operations of $15.6 million for the corresponding period a year ago, and cash flow from operations of $20.1 million in the first quarter of 2025. Capital expenditures for the second quarter totaled $6.2 million, compared to $6.1 million for the corresponding period a year ago and $4.6 million for the first quarter of 2025. Cash and cash equivalents as of June 30, 2025 increased 14.3% sequentially to approximately $338.5 million compared to approximately $296.1 million as of March 31, 2025.

    Backlog for the second quarter ended June 30, 2025 totaled $155.2 million, a 0.9% increase from $153.8 million for the corresponding period a year ago, and 9.6% sequential decrease from $171.7 million at the end of the first quarter of 2025.

    Commenting on second quarter performance, Chief Executive Officer Dr. Patrizio Vinciarelli stated: “Having brought to fruition our first ITC action with cease-and-desist and exclusion orders, we are pursuing additional actions to curtail importation into the US of infringing power and computing systems sourced from contract manufacturers by unlicensed OEMs and Hyper-scalers.”

    “As importantly, we are bringing to fruition high performance ChiPs and 2nd gen VPD for AI applications, which should increase product revenues and utilization of our first ChiP fab. Total revenues and margins will thus reflect many patented innovations in the state of the art of high density power systems.”

    For more information on Vicor and its products, please visit the Company’s website at www.vicorpower.com.

    Earnings Conference Call

    Vicor will be holding its investor conference call today, Tuesday, July 22, 2025 at 5:00 p.m. Eastern Time. Vicor encourages investors and analysts who intend to ask questions via the conference call to register with Notified, the service provider hosting the conference call. Those registering on Notified’s website will receive dial-in info and a unique PIN to join the call as well as an email confirmation with the details. Registration may be completed at any time prior to 5:00 p.m. on July 22, 2025. For those parties interested in listen-only mode, the conference call will be webcast via a link that will be posted on the Investor Relations page of Vicor’s website prior to the conference call. Please access the website at least 15 minutes prior to the conference call to register and, if necessary, download and install any required software. For those who cannot participate in the live conference call, a webcast replay of the conference call will also be available on the Investor Relations page of Vicor’s website.

    This press release contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Any statement in this press release that is not a statement of historical fact is a forward-looking statement, and, the words “believes,” “expects,” “anticipates,” “intends,” “estimates,” “plans,” “assumes,” “may,” “will,” “would,” “should,” “continue,” “prospective,” “project,” and other similar expressions identify forward-looking statements. Forward-looking statements also include statements regarding bookings, shipments, revenue, profitability, targeted markets, increase in manufacturing capacity and utilization thereof, future products and capital resources. These statements are based upon management’s current expectations and estimates as to the prospective events and circumstances that may or may not be within the company’s control and as to which there can be no assurance. Actual results could differ materially from those projected in the forward-looking statements as a result of various factors, including those economic, business, operational and financial considerations set forth in Vicor’s Annual Report on Form 10-K for the year ended December 31, 2024, under Part I, Item I — “Business,” under Part I, Item 1A — “Risk Factors,” under Part I, Item 3 — “Legal Proceedings,” and under Part II, Item 7 — “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” The risk factors set forth in the Annual Report on Form 10-K may not be exhaustive. Therefore, the information contained in the Annual Report on Form 10-K should be read together with other reports and documents filed with the Securities and Exchange Commission from time to time, including Forms 10-Q, 8-K and 10-K, which may supplement, modify, supersede or update those risk factors. Vicor does not undertake any obligation to update any forward-looking statements as a result of future events or developments.

    Vicor Corporation designs, develops, manufactures, and markets modular power components and complete power systems based upon a portfolio of patented technologies. Headquartered in Andover, Massachusetts, Vicor sells its products to the power systems market, including enterprise and high performance computing, industrial equipment and automation, telecommunications and network infrastructure, vehicles and transportation, and aerospace and defense electronics.
      
    For further information contact:
            
    James F. Schmidt, Chief Financial Officer
    Office: (978) 470-2900
    Email: invrel@vicorpower.com

    VICOR CORPORATION              
                   
    CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS        
    (Thousands except for per share amounts)              
                   
      QUARTER ENDED   YEAR ENDED
      (Unaudited)   (Unaudited)
                   
      JUN 30,   JUN 30,   JUN 30,   JUN 30,
      2025   2024   2025   2024
                   
                   
    Product revenue $ 85,693   $ 76,583     $ 168,899   $ 152,275  
    Royalty revenue   10,353     9,271       21,115     17,451  
    Patent litigation settlement   45,000                         –       45,000                         –  
    Total product revenue, royalty revenue and patent litigation settlement   141,046     85,854       235,014     169,726  
    Cost of product revenues   48,918     43,083       98,521     81,832  
             Gross margin   92,128     42,771       136,493     87,894  
                   
    Operating expenses:              
              Selling, general and administrative   27,952     23,318       53,089     49,317  
              Research and development   18,791     16,939       38,168     34,978  
              Litigation-contingency expense                       –     2,300                           –     19,500  
                 Total operating expenses   46,743     42,557       91,257     103,795  
                   
    Income (loss) from operations   45,385     214       45,236     (15,901 )
                   
    Other income (expense), net   3,657     2,807       6,791     5,531  
                   
    Income (loss) before income taxes   49,042     3,021       52,027     (10,370 )
                   
    Less: Provision for income taxes   7,842     4,216       8,266     5,287  
                   
    Consolidated net income (loss)   41,200     (1,195 )     43,761     (15,657 )
                   
    Less: Net income attributable to              
      noncontrolling interest   8     1       30     12  
                   
    Net income (loss) attributable to              
      Vicor Corporation $ 41,192   ($ 1,196 )   $ 43,731   ($ 15,669 )
                   
                   
    Net income (loss) per share attributable              
      to Vicor Corporation:              
               Basic $ 0.92   $ (0.03 )   $ 0.97   $ (0.35 )
               Diluted $ 0.91   $ (0.03 )   $ 0.97   $ (0.35 )
                   
    Shares outstanding:              
               Basic   45,007     44,855       45,112     44,686  
               Diluted   45,077     44,855       45,286     44,686  
                   
    VICOR CORPORATION      
           
    CONDENSED CONSOLIDATED BALANCE SHEET    
    (Thousands)      
           
           
      JUN 30,   DEC 31,
        2025       2024  
      (Unaudited)   (Unaudited)
    Assets      
           
    Current assets:      
            Cash and cash equivalents $ 338,541     $ 277,273  
            Accounts receivable, net   55,085       52,948  
            Inventories   95,493       106,032  
            Other current assets   25,662       26,781  
                      Total current assets   514,781       463,034  
           
    Long-term deferred tax assets   281       261  
    Long-term investment, net   2,584       2,641  
    Property, plant and equipment, net   154,285       152,705  
    Other assets   21,578       22,477  
           
                      Total assets $ 693,509     $ 641,118  
           
    Liabilities and Equity      
           
    Current liabilities:      
            Accounts payable $ 16,805     $ 8,737  
            Accrued compensation and benefits   13,351       10,852  
            Accrued expenses   3,351       6,589  
            Accrued litigation   27,563       26,888  
            Sales allowances   2,639       1,667  
            Short-term lease liabilities   1,699       1,716  
            Income taxes payable   2,926       59  
            Short-term deferred revenue and customer prepayments   5,506       5,312  
           
                     Total current liabilities   73,840       61,820  
           
    Long-term income taxes payable   4,809       3,387  
    Long-term lease liabilities   5,994       5,620  
                     Total liabilities   84,643       70,827  
           
    Equity:      
      Vicor Corporation stockholders’ equity:      
            Capital stock   420,385       408,187  
            Retained earnings   346,534       302,803  
            Accumulated other comprehensive loss   (1,291 )     (1,495 )
            Treasury stock   (157,033 )     (139,424 )
                 Total Vicor Corporation stockholders’ equity   608,595       570,071  
      Noncontrolling interest   271       220  
            Total equity   608,866       570,291  
           
                      Total liabilities and equity $ 693,509     $ 641,118  
           

    The MIL Network –

  • MIL-OSI: CNB Financial Corporation Reports Second Quarter 2025 Results

    Source: GlobeNewswire (MIL-OSI)

    CLEARFIELD, Pa., July 22, 2025 (GLOBE NEWSWIRE) —

    CNB Financial Corporation (“Corporation”) (NASDAQ: CCNE), the parent company of CNB Bank, today announced its earnings for the three and six months ended June 30, 2025.

    Key Financial Trends

    • Earnings – Net income available to common shareholders (“earnings”) was $12.9 million, or $0.61 per diluted share, and $10.4 million, or $0.50 per diluted share, for the three months ended June 30, 2025 and March 31, 2025, respectively.
      • Excluding after-tax merger costs, earnings were $13.2 million, or $0.63 per diluted share, for the three months ended June 30, 2025, reflecting an increase of $1.3 million, or 11.31%, and $0.06 per diluted share, or 10.53%, compared to earnings of $11.9 million, or $0.57 per diluted share, for the three months ended March 31, 2025.1
    • Loans – At June 30, 2025, loans totaled $4.7 billion, excluding the balances of syndicated loans, representing a quarterly increase of $113.7 million, or 2.50% (10.04% annualized), compared to March 31, 2025.
    • Deposits – At June 30, 2025, total deposits were $5.5 billion, reflecting a quarterly increase of $7.0 million, or 0.13% (0.51% annualized), compared to March 31, 2025.
      • The second quarter of 2025 included the exits/reductions of higher cost municipal deposits totaling approximately $77.7 million. Excluding the impact of these exits/reductions, total deposits increased approximately $84.7 million or 1.55% (6.22% annualized), compared to the first quarter of 2025.1
    • Net Interest Margin – Net interest margin was 3.60% for the three months ended June 30, 2025, compared to 3.38% for the three months ended March 31, 2025. Net interest margin on a fully tax-equivalent basis, a non-GAAP measure, was 3.59% and 3.37%, for the three months ended June 30, 2025 and March 31, 2025, respectively.1
    • Credit Quality – Total nonperforming assets were approximately $30.4 million, or 0.48% of total assets, as of June 30, 2025, compared to $56.1 million, or 0.89% of total assets, as of March 31, 2025. The $25.7 million decrease in nonperforming assets for the three months ended June 30, 2025, was primarily due to the resolution of approximately $24.1 million in non-performing assets, as discussed in more detail below.
      • Net loan charge-offs were $3.3 million, or 0.28% (annualized) of average total loans and loans held for sale, for the three months ended June 30 2025, compared to $1.4 million, or 0.13% (annualized) of average total loans and loans held for sale, during the three months ended March 31, 2025.
    • Capital – As of June 30, 2025, the Corporation’s ratio of common shareholders’ equity to total assets was 9.17% compared to 9.00% at March 31, 2025. As of June 30, 2025 and March 31, 2025, the Corporation’s ratio of tangible common equity to tangible assets, a non-GAAP measure, was 8.53% and 8.36%, respectively.1

    Executive Summary

    • Net income available to common shareholders (“earnings”) was $12.9 million, or $0.61 per diluted share, and $10.4 million, or $0.50 per diluted share, for the three months ended June 30, 2025 and March 31, 2025, respectively. Excluding after-tax merger costs, earnings were $13.2 million, or $0.63 per diluted share, for the three months ended June 30, 2025, reflecting an increase of $1.3 million, or 11.31%, and $0.06 per diluted share, or 10.53%, compared to earnings of $11.9 million, or $0.57 per diluted share, for the three months ended March 31, 2025.1 The quarterly increase was a result of an increase in net interest income and non-interest income, and a decrease in non-interest expense, partially offset by an increase in the provision for credit losses, as discussed in more detail below. Excluding after-tax merger costs in the second quarter 2025, earnings and diluted earnings per share when compared to earnings of $11.9 million, or $0.56 per diluted share, in the quarter ended June 30, 2024, increased $1.4 million, or 11.41%, and $0.07 per diluted share, or 12.50%, due to an increase in net interest income and non-interest income, partially offset by increases in non-interest expense and the provision for credit losses.1
    • Earnings were $23.3 million, or $1.10 per diluted share, for the six months ended June 30, 2025. Excluding after-tax merger costs, earnings were $25.1 million, or $1.19 per diluted share, for the six months ended June 30, 2025, reflecting an increase of $1.7 million, or 7.37%, and $0.08 per diluted share, or 7.21%, compared to earnings of $23.4 million, or $1.11 per diluted share, for the six months ended June 30, 2024.1 The year-to-date increase was a result of an increase in net interest income, partially offset by a decrease in non-interest income, and increases in non-interest expense and the provision for credit losses, as discussed in more detail below.
    • At June 30, 2025, loans totaled $4.7 billion, excluding the balances of syndicated loans. This total of $4.7 billion in loans represented a quarterly increase of $113.7 million, or 2.50% (10.04% annualized), compared to March 31, 2025, and a year-over-year increase of $228.7 million, or 5.17%, compared to June 30, 2024. The increase in loans for the quarter ended June 30, 2025, compared to the quarter ended March 31, 2025, and the year-over-year increase in loans as of June 30, 2025, compared to June 30, 2024, was primarily driven by growth in the ERIEBANK, Ridge View Bank, BankOnBuffalo, and the legacy CNB markets, as well as CNB Bank’s Private Banking division.
      • At June 30, 2025, the syndicated loan portfolio totaled $78.9 million, or 1.67% of total loans, compared to $69.2 million, or 1.50% of total loans, at March 31, 2025 and $53.9 million, or 1.20% of total loans, at June 30, 2024. The increase in syndicated lending balances of $9.7 million compared to March 31, 2025 and $25.0 million compared to June 30, 2024 reflects the Corporation’s continued focus on evaluating the level and composition of its syndicated loan portfolio to ensure it continues to provide strong credit quality, profitable use of excess liquidity, and complement the Corporation’s loan growth from its in-market customer relationships.
    • At June 30, 2025, total deposits were $5.5 billion, reflecting a quarterly increase of $7.0 million, or 0.13% (0.51% annualized), compared to March 31, 2025, and a year-over-year increase of $356.2 million, or 6.97%, compared to total deposits measured as of June 30, 2024. The growth in total deposits in the second quarter of 2025 includes the exit/reductions of higher cost municipal deposits totaling approximately $77.7 million. Excluding the impact of these exit/reductions, total deposits increased approximately $84.7 million or 1.55% (6.22% annualized).1 The increase in deposit balances for the quarter ended June 30, 2025, compared to the quarter ended March 31, 2025, and the year-over-year increase in deposit balances as of June 30, 2025, was driven primarily by higher Treasury Management sourced business and municipal deposits, coupled with growth in retail accounts, including time deposits. Additional deposit and liquidity profile details were as follows:
      • At June 30, 2025, the total estimated uninsured deposits for CNB Bank were approximately $1.6 billion, or approximately 28.62% of total CNB Bank deposits. However, when excluding $103.5 million of affiliate company deposits and $509.0 million of pledged-investment collateralized deposits, the adjusted amount and percentage of total estimated uninsured deposits was approximately $982.0 million, or approximately 17.63% of total CNB Bank deposits as of June 30, 2025.
        • The level of adjusted uninsured deposits at June 30, 2025 remained relatively unchanged, compared to the level at March 31, 2025, when the total estimated uninsured deposits for CNB Bank were approximately $1.6 billion, or approximately 27.94% of total CNB Bank deposits. Excluding $101.9 million of affiliate company deposits and $481.2 million of pledged-investment collateralized deposits, the adjusted amount and percentage of total estimated uninsured deposits were approximately $971.1 million, or approximately 17.46% of total CNB Bank deposits as of March 31, 2025.
      • At June 30, 2025, the average deposit balance per account for CNB Bank was approximately $34 thousand, which has remained stable at this level for an extended period.
      • At June 30, 2025, the Corporation had $332.2 million of cash equivalents held in CNB Bank’s interest-bearing deposit account at the Federal Reserve. These excess funds, when combined with collective contingent liquidity resources of $4.6 billion including (i) available borrowing capacity from the Federal Home Bank of Pittsburgh (“FHLB”) and the Federal Reserve, and (ii) available unused commitments from brokered deposit sources and other third-party funding channels, including previously established lines of credit from correspondent banks, resulted in the total available liquidity sources for the Corporation as of June 30, 2025 to be approximately 5.1 times the estimated amount of adjusted uninsured deposit balances discussed above.
    • At June 30, 2025, March 31, 2025, and June 30, 2024, the Corporation had no outstanding short-term borrowings from the FHLB or the Federal Reserve’s Discount Window.
    • At June 30, 2025, the Corporation’s pre-tax net unrealized losses on the combined portfolios of available-for-sale and held-to-maturity securities totaled $55.6 million, or 8.73% of total shareholders’ equity, compared to $61.7 million, or 9.88% of total shareholders’ equity, at March 31, 2025, and $84.1 million, or 14.33% of total shareholders’ equity, at June 30, 2024. The change in unrealized losses during the first second quarter 2025 was primarily due to changes in the yield curve compared to the first quarter of 2024 and second quarter of 2024, coupled with the Corporation’s scheduled bond maturities, which were all realized at par. Importantly, all regulatory capital ratios for the Corporation would still exceed regulatory “well-capitalized” levels as of June 30, 2025, March 31, 2025, and June 30, 2024 if the net unrealized losses at the respective dates were fully recognized. Additionally, the Corporation continued to maintain excess liquidity at its holding company totaling approximately $102.2 million of liquid funds at June 30, 2025, which more than covers the $55.6 million in combined available-for-sale and held-to-maturity unrealized losses on investments held primarily in its wholly-owned banking subsidiary, as an immediately available source of contingent capital to be down-streamed to CNB Bank, if necessary.
    • Total nonperforming assets were approximately $30.4 million, or 0.48% of total assets, as of June 30, 2025, compared to $56.1 million, or 0.89% of total assets, as of March 31, 2025, and $36.5 million, or 0.62% of total assets, as of June 30, 2024. The $25.7 million decrease in nonperforming assets for the three months ended June 30, 2025, compared to the three months ended March 31, 2025 was primarily due to paydowns to workout-related efforts on two larger nonaccrual loan relationships, and resulting charge-offs on these workouts and other smaller problem loans. The most significant charge-offs were $1.5 million for an owner-occupied commercial real estate relationship (balance of approximately $3.8 million with a specific reserve balance of $1.4 million) and a $1.1 million charge-off of a multifamily commercial real estate loan (balance of approximately $20.3 million with a specific reserve balance of $885 thousand). The $6.2 million decrease in nonperforming assets at June 30, 2025 compared to June 30, 2024 was due to charge-off of the owner-occupied commercial real estate relationship previously discussed, coupled with paydowns to nonaccrual loans. For the three months ended June 30, 2025, net loan charge-offs were $3.3 million, or 0.28% (annualized) of average total loans and loans held for sale, compared to $1.4 million, or 0.13% (annualized) of average total loans and loans held for sale, during the three months ended March 31, 2025, and $2.8 million, or 0.25% (annualized) of average total loans and loans held for sale, during the three months ended June 30, 2024.
    • Pre-provision net revenue (“PPNR”), a non-GAAP measure, was $21.6 million for the three months ended June 30, 2025 and $15.9 million for the three months ended March 31, 2025.1 Excluding merger costs, PPNR was $21.9 million for the three months ended June 30, 2025, compared to $17.4 million and $18.6 million for the three months ended March 31, 2025 and June 30, 2024, respectively.1 The second quarter 2025 PPNR, excluding merger costs, when compared to the first quarter of 2025, reflected increases in net interest income and non-interest income and a decrease in non-interest expense. The increase in PPNR for the three months ended June 30, 2025, compared to the three months ended June 30, 2024 was primarily attributable to higher net interest income, partially offset by an increase in non-interest expenses. PPNR was $37.5 million for the six months ended June 30, 2025.1 Excluding merger costs, PPNR was $39.4 million for the six months ended June 30, 2025, compared to $35.3 million for the six months ended June 30, 2024.1 The year-to-date 2025 PPNR, excluding merger costs, when compared to the year-to-date 2024 PPNR, reflected increases in net interest income, partially offset by a decrease in non-interest income and an increase in non-interest expense.

    1 This release contains references to certain financial measures that are not defined by U.S. Generally Accepted Accounting Principles (“GAAP”). Management believes that these non-GAAP measures provide a greater understanding of ongoing operations, enhance comparability of results of operations with prior periods and show the effects of significant gains and charges in the periods presented. A reconciliation of these non-GAAP financial measures is provided in the “Reconciliation of Non-GAAP Financial Measures” section.

    Michael Peduzzi, President and CEO of both the Corporation and CNB Bank, stated, “Favorably, our second quarter earnings and growth reflected the positive momentum of continued commercial loan growth and demand that we saw at the end of the first quarter with both existing relationships and new prospects. This momentum included realized deposit and relationship growth based in our Treasury Management activities, as evidenced by favorable growth in our noninterest-bearing deposits. These volume increases in our core net interest income components were complemented by increases in our average loan yield and continued decreases in our cost of interest-bearing funds, resulting in a favorable 22 basis point increase in our taxable-equivalent net interest margin compared to the first quarter. We continue to see both a sound loan pipeline and opportunities for further cost-of-fund interest reductions as we enter the third quarter. Importantly, as we release these second quarter earnings, we are ready to close and begin the integration of our acquisition of ESSA Bancorp, Inc. and its subsidiary, ESSA Bank and Trust (collectively, “ESSA”), with legal merger close scheduled to occur at the end of day on July 23, 2025. The addition of this wonderful franchise and related employee team will add significantly to CNB’s earning-asset base and market footprint, allowing us to deliver great banking and wealth management experiences for clients in the Northeastern Pennsylvania markets served by ESSA. In addition to the increased net interest income earning and growth capabilities we expect from our business combination, we look to continue to focus on tightly managing the Corporation’s core overhead, while realizing economies-of-scale cost efficiencies from the ESSA acquisition, as we look to realize both increased positive operating leverage and further accretion to our net interest margin and overall earnings. We are honored to welcome the clients, employees, and investors from ESSA to our CNB family.”

    Other Balance Sheet Highlights

    • Book value per common share was $27.44 and $27.01 at June 30, 2025 and March 31, 2025, respectively. Excluding after-tax merger costs, book value per common share was $27.53, reflecting an increase of $0.45, or 6.67% (annualized), from $27.08 at March 31, 2025 and a year-over-year increase of $2.34, or 9.29%, from $25.19 at June 30, 2024.1 Tangible book value per common share, a non-GAAP measure, was $25.35 and $24.91 as of June 30, 2025 and March 31, 2025, respectively. Excluding after-tax merger costs, tangible book value per common share, a non-GAAP measure, was $25.44, reflecting an increase of $0.46, or 7.39% (annualized) from $24.98 as of March 31, 2025 and a year-over-year increase of $2.35, or 10.18%, from $23.09 as of June 30, 2024.1 The increases in book value per common share and tangible book value per common share, excluding after-tax merger costs, from March 31, 2025 to June 30, 2025 were primarily due to a $9.1 million increase in retained earnings, coupled with a $3.0 million decrease in accumulated other comprehensive loss primarily from the after-tax impact of temporary unrealized valuation changes in the Corporation’s available-for-sale investment portfolio for the second quarter of 2025. The increases in book value per common share and tangible book value per common share, excluding after-tax merger costs, from June 30, 2024 to June 30, 2025 were primarily due to a $35.0 million increase in retained earnings over the twelve months ended June 30, 2025 coupled with a $13.9 million decrease in accumulated other comprehensive loss primarily from the after-tax impact of temporary unrealized valuation changes in the Corporation’s available-for-sale investment portfolio for the past twelve months.

    Loan Portfolio Profile

    • As part of its lending policy and risk management activities, the Corporation tracks lending exposure by industry classification and type to determine potential risks associated with industry concentrations, and to identify any concentration risk issues that could lead to additional credit loss exposure. An important and recurring part of this process involves the Corporation’s continued measurement and evaluation of its exposure to the office, hospitality, and multifamily industries within its commercial real estate portfolio. Even given the Corporation’s historically sound underwriting protocols and high credit quality standards for borrowers in the commercial real estate industry segments, the Corporation monitors numerous relevant sensitivity elements, including occupancy, loan-to-value, absorption and cap rates, debt service coverage and covenant compliance, and developer/lessor financial strength both in the project and globally. At June 30, 2025, the Corporation had the following key metrics related to its office, hospitality and multifamily portfolios:
      • Commercial office loans:
        • There were 113 outstanding loans, totaling $111.1 million, or 2.35% of total Corporation loans outstanding;
        • There were no nonaccrual commercial office loans;
        • There were two past-due commercial office loans that totaled $209 thousand, or 0.19% of total commercial office loans outstanding; and
        • The average outstanding balance per commercial office loan was $983 thousand.
      • Commercial hospitality loans:
        • There were 156 outstanding loans, totaling $321.2 million, or 6.79% of total Corporation loans outstanding;
        • There were no nonaccrual commercial hospitality loans;
        • There were no past-due commercial hospitality loans; and
        • The average outstanding balance per commercial hospitality loan was $2.1 million.
      • Commercial multifamily loans:
        • There were 223 outstanding loans, totaling $405.4 million, or 8.57% of total Corporation loans outstanding;
        • There was one nonaccrual and past-due commercial multifamily loan that totaled $199 thousand, or 0.05% of total multifamily loans outstanding; and
        • The average outstanding balance per commercial multifamily loan was $1.8 million.

    The Corporation had no commercial office, hospitality or multifamily loan relationships considered by the banking regulators to be high volatility commercial real estate (“HVCRE”) credits.

    Performance Ratios

    • Annualized return on average equity was 8.83% and 7.52% for the three months ended June 30, 2025 and March 31, 2025, respectively. Excluding after-tax merger costs, annualized return on average equity was 9.06% for the three months ended June 30, 2025, compared to 8.49% and 8.94% for the three months ended March 31, 2025 and June 30, 2024, respectively.1 Annualized return on average equity was 8.18% for the six months ended June 30, 2025. Excluding after-tax merger costs, annualized return on average equity was 8.78% for the six months ended June 30, 2025, compared to 8.86% for the six months ended June 30, 2024.1
    • Annualized return on average tangible common equity, a non-GAAP measure, was 9.71% and 8.15% for the three months ended June 30, 2025 and March 31, 2025, respectively. Excluding after-tax merger costs, annualized return on average tangible common equity was 9.98% for the three months ended June 30, 2025, compared to 9.32% and 9.93% for the three months ended March 31, 2025 and June 30, 2024, respectively.1 Annualized return on average tangible common equity was 8.95% for the six months ended June 30, 2025. Excluding after-tax merger costs, annualized return on average tangible common equity was 9.66% for the six months ended June 30, 2025, compared to 9.85% for the six months ended June 30, 2024.1
    • The Corporation’s efficiency ratio was 64.73% and 72.07% for the three months ended June 30, 2025 and March 31, 2025, respectively, and 64.08% and 71.28%, respectively, on a fully tax-equivalent basis, a non-GAAP measure.1 Excluding merger costs, the efficiency ratio on a fully tax-equivalent basis, a non-GAAP measure, was 63.50%, compared to 68.62% and 65.20% for the three months ended March 31, 2025 and June 30, 2024, respectively.1 The quarter-over-quarter decrease was primarily driven by higher net interest income and non-interest income and decreased non-interest expense, as further discussed below. The year-over-year decrease was primarily driven by an increase in net interest income, partially offset by an increase in non-interest expense. The Corporation’s efficiency ratio was 68.27% for the six months ended June 30, 2025, and 67.55% on a fully tax-equivalent basis, a non-GAAP measure.1 Excluding merger costs, the efficiency ratio on a fully tax-equivalent basis, a non-GAAP measure, was 65.97%, compared to 66.74% for the six months ended June 30, 2024.1 The year-over-year decrease was primarily driven by higher net interest income, partially offset by higher non-interest expense.

    Revenue

    • Total revenue (net interest income plus non-interest income) was $61.2 million for the three months ended June 30, 2025, an increase when compared to $56.9 million and $54.6 million for the three months ended March 31, 2025 and June 30, 2024, respectively.
      • Net interest income was $52.2 million for the three months ended June 30, 2025, compared to $48.4 million and $45.7 million for the three months ended March 31, 2025 and June 30, 2024, respectively. When comparing the second quarter of 2025 to the first quarter of 2025, the increase in net interest income of $3.8 million, or 7.78% (31.19% annualized), was primarily due to the change in the earning asset mix from interest-bearing deposits to loans, coupled with changes in the yield curve.
      • Net interest margin was 3.60%, 3.38%, and 3.36% for the three months ended June 30, 2025, March 31, 2025, and June 30, 2024, respectively. Net interest margin on a fully tax-equivalent basis, a non-GAAP measure, was 3.59%, 3.37% and 3.34% for the three months ended June 30, 2025, March 31, 2025, and June 30, 2024, respectively.1
        • The yield on earning assets of 5.89% for the three months ended June 30, 2025 increased 16 basis points from March 31, 2025 and was unchanged compared to June 30, 2024. The increase in yield in the second quarter of 2025 compared to quarter ended March 31, 2025 was attributable to quarter-over-quarter increases in the yield on both the loan and securities portfolios.
        • The cost of interest-bearing liabilities was 2.88% for the three months ended June 30, 2025, representing a decrease of 5 basis points from March 31, 2025 and a 29 basis points from June 30, 2024. The decrease in the cost of interest-bearing liabilities is primarily the result of the Corporation’s targeted interest-bearing deposit rate decreases in response to the Federal Reserve rate decreases since mid-September 2024.
    • Total revenue was $118.1 million for the six months ended June 30, 2025 compared to $108.8 million for the six months ended June 30, 2024.
      • Net interest income was $100.6 million for the six months ended June 30, 2025 compared to $90.9 million for the six months ended June 30, 2024. When comparing the six months ended June 30, 2025 to the six months ended June 30, 2024, the increase in net interest income of $9.7 million, or 10.65% (21.37% annualized), was due to investment and loan growth.
      • Net interest margin was 3.49% and 3.38% for the six months ended June 30, 2025 and June 30, 2024, respectively. Net interest margin on a fully tax-equivalent basis, a non-GAAP measure, was 3.48% and 3.36% for the six months ended June 30, 2025 and June 30, 2024, respectively.1
        • The yield on earning assets of 5.81% for the six months ended June 30, 2025 decreased 4 basis points from June 30, 2024. The decrease in yield compared to June 30, 2024 was attributable to lower loan yields on variable and floating-rate loans following the three Federal Reserve rate decreases totaling 100 basis points since mid-September 2024.
        • The cost of interest-bearing liabilities of 2.90% for the six months ended June 30, 2025 decreased 20 basis points from June 30, 2024, primarily the result of the Corporation’s targeted interest-bearing deposit rate decreases in response to the Federal Reserve rate decreases since mid-September 2024.
    • Total non-interest income was $9.0 million for the three months ended June 30, 2025 compared to $8.5 million and $8.9 million for the three months ended March 31, 2025 and June 30, 2024, respectively. The quarter-over-quarter increase was primarily attributable to an increase in wealth and asset management fees, bank owned life insurance revenue (death benefit), and an improvement in unrealized gains on equity securities, partially offset by lower pass-through income from small business investment companies (“SBICs”). The increase year-over-year in non-interest income was primarily due to increases in bank owned life insurance (death benefit) and an improvement in unrealized gains on equity securities, partially offset by lower other charges and fees, coupled with lower pass-through income from SBICs.
    • Total non-interest income was $17.5 million for the six months ended June 30, 2025 compared to $17.8 million for the six months ended June 30, 2024. This decrease was primarily due to lower other charges and fees, coupled with lower pass-through income from SBICs, partially offset by an increase in unrealized gains on equity securities, bank owned life insurance revenue (death benefit) and card processing and interchange income.

    Non-Interest Expense

    • For the three months ended June 30, 2025 and March 31, 2025 total non-interest expense was $39.6 million and $41.0 million, respectively. Excluding merger costs, total non-interest expense for the three months ended June 30, 2025 was $39.3 million, compared to $39.5 million and $36.0 million for the three months ended March 31, 2025 and June 30, 2024, respectively.1 Excluding merger costs, the decrease of $249 thousand, or 0.63%, from the three months ended March 31, 2025, was primarily driven by a decrease in salaries and benefits, due to a decrease in staffing levels, coupled with retirement plan contribution accruals. The Corporation tightly managed its core back-office staffing levels in anticipation of the impact of staffing additions from the planned ESSA acquisition. Excluding merger costs, the $3.3 million increase in non-interest expense compared to the three months ended June 30, 2024 was primarily driven by higher salaries and benefits, reflecting increased incentive compensation accruals and retirement plan contribution accruals. Additionally, occupancy expense increased, primarily due to higher rent expense related to three additional full-service office locations, coupled with an increase in card processing and interchange expenses and other non-interest expenses (timing of business development expenses). The increase in card processing and interchange expenses related to the changes made by the Corporation to its cardholder rewards program during the second quarter 2024.
    • For the six months ended June 30, 2025 total non-interest expense was $80.7 million. Excluding merger costs, total non-interest expense was $78.8 million, compared to $73.4 million for the six months ended June 30, 2024. Excluding merger costs, the increase of $5.4 million, or 7.30%, from the six months ended June 30, 2024, was primarily driven by higher salaries and benefits, reflecting increased base salaries for inflationary annual increases, higher incentive compensation accruals, and increased retirement plan contribution accruals. Additionally, occupancy expense increased, primarily due to higher rent expense related to three additional full-service office locations, coupled with an increase in card processing and interchange expenses and other non-interest expenses (timing of business development expenses).

    Income Taxes

    • Income tax expense for the three months ended June 30, 2025 was $3.3 million, representing a 19.10% effective tax rate, compared to $2.9 million, representing a 19.96% effective tax rate, for the three months ended March 31, 2025, and $3.0 million, representing an 19.03% effective tax rate, for the three months ended June 30, 2024. The effective tax rate for the first and second quarters of 2025 was impacted by non-deductible merger costs of $1.3 million and $357 thousand, respectively. Income tax expense for the six months ended June 30, 2025 was $6.2 million, representing a 19.49% effective tax rate, compared to $5.9 million, representing a 18.70% effective tax rate, for the six months ended June 30, 2025.

    Asset Quality

    • Total nonperforming assets were approximately $30.4 million, or 0.48% of total assets, as of June 30, 2025, compared to $56.1 million, or 0.89% of total assets, as of March 31, 2025, and $36.5 million, or 0.62% of total assets, as of June 30, 2024, as discussed in more detail above.
    • The allowance for credit losses measured as a percentage of total loans was 1.02% as of June 30, 2025, compared to 1.03% as of as of March 31, 2025, and 1.02% as of June 30, 2024. In addition, the allowance for credit losses as a percentage of nonaccrual loans was 169.52% as of June 30, 2025, compared to 87.57% and 130.88% as of March 31, 2025 and June 30, 2024, respectively. The change in the allowance for credit losses as a percentage of nonaccrual loans was primarily attributable to the levels of nonperforming assets, as discussed in more detail above.
    • The provision for credit losses was $4.3 million for the three months ended June 30, 2025, compared to $1.6 million and $2.6 million for the three months ended March 31, 2025 and June 30, 2024, respectively. The $2.8 million and $1.7 million increases in the provision expense for the second quarter of 2025 compared to the first quarter of 2025 and second quarter 2024, respectively, were primarily a result of increased net loan charge-offs, as discussed in more detail above, coupled with higher loan portfolio growth. The provision for credit losses was $5.9 million for the six months ended June 30, 2025, compared to $3.9 million for the six months ended June 30, 2024. The $2.0 million increase in the provision expense for the first six months of 2025 compared to the first six months of 2024 was primarily a result of higher loan portfolio growth for the six months ended June 30, 2025 compared to the six months ended June 30, 2024, coupled with increased net loan charge-offs, as discussed above.
    • As discussed in more detail above, for the three months ended June 30, 2025, net loan charge-offs were $3.3 million, or 0.28% (annualized) of average total loans and loans held for sale, compared to $1.4 million, or 0.13% (annualized) of average total loans and loans held for sale, during the three months ended March 31, 2025, and $2.8 million, or 0.25% (annualized) of average total loans and loans held for sale, during the three months ended June 30, 2024.
    • For the six months ended June 30, 2025, net loan charge-offs were $4.7 million, or 0.21% (annualized) of average total loans and loans held for sale, compared to $4.1 million, or 0.19% (annualized) of average total loans and loans held for sale, during the six months ended June 30, 2024.

    Capital

    • As of June 30, 2025, the Corporation’s total shareholders’ equity was $637.3 million, representing an increase of $12.8 million, or 2.05% (8.20% annualized), from March 31, 2025, and an increase of $50.6 million, or 8.62%, from June 30, 2024. The changes resulted from an increase in the Corporation’s retained earnings (net income, partially offset by the common and preferred stock dividends paid) and a decrease in accumulated other comprehensive loss primarily from the after-tax impact of temporary unrealized valuation changes in the Corporation’s available-for-sale investment portfolio.
    • Regulatory capital ratios for the Corporation continue to exceed regulatory “well-capitalized” levels as of June 30, 2025, consistent with prior periods.
    • As of June 30, 2025, the Corporation’s ratio of common shareholders’ equity to total assets was 9.17% compared to 9.00% at March 31, 2025 and 8.99% at June 30, 2024. As of June 30, 2025 and March 31, 2025, the Corporation’s ratio of tangible common equity to tangible assets, a non-GAAP measure, was 8.53% and 8.36%, respectively. Excluding merger costs, the Corporation’s ratio of tangible common equity to tangible assets, a non-GAAP measure, as of June 30, 2025 was 8.56% compared to 8.38% at March 31, 2025 and 8.30% at June 30, 2024.1 The increase in the June 30, 2025 ratio of tangible common equity to tangible assets compared to March 31, 2025 and June 30, 2024 was primarily the result of a decrease in accumulated other comprehensive loss, coupled with an increase in retained earnings, as discussed above.1

    Recent Events

    • On January 10, 2025, the Corporation announced that the Corporation and CNB Bank entered into a definitive merger agreement (the “Merger Agreement”) with ESSA Bancorp, Inc. (“ESSA”) and ESSA Bank and Trust in an all-stock transaction. Under the terms of the Merger Agreement, each outstanding share of ESSA common stock will be converted into the right to receive 0.8547 shares of the Corporation’s common stock. On June 30, 2025, the Corporation and ESSA announced they have received the requisite bank regulatory approvals and waivers from the Federal Deposit Insurance Corporation, the Pennsylvania Department of Banking and Securities and the Federal Reserve Bank of Philadelphia necessary for CNB to complete its acquisition of ESSA and ESSA Bank & Trust. The transaction is currently expected to close July 23, 2025, subject to customary closing conditions.

    About CNB Financial Corporation

    CNB Financial Corporation is a financial holding company with consolidated assets of approximately $6.3 billion. CNB Financial Corporation conducts business primarily through its principal subsidiary, CNB Bank. CNB Bank is a full-service bank engaging in a full range of banking activities and services, including trust and wealth management services, for individual, business, governmental, and institutional customers. CNB Bank operations include a private banking division, one loan production office, one drive-up office, one mobile office, and 55 full-service offices in Pennsylvania, Ohio, New York, and Virginia. CNB Bank, headquartered in Clearfield, Pennsylvania, with offices in Central and North Central Pennsylvania, serves as the multi-brand parent to various divisions. These divisions include ERIEBANK, based in Erie, Pennsylvania, with offices in Northwest Pennsylvania and Northeast Ohio; FCBank, based in Worthington, Ohio, with offices in Central Ohio; BankOnBuffalo, based in Buffalo, New York, with offices in Western New York; Ridge View Bank, based in Roanoke, Virginia, with offices in the Southwest Virginia region; and Impressia Bank, a division focused on banking opportunities for women, which operates in CNB Bank’s primary market areas. Additional information about CNB Financial Corporation may be found at www.CNBBank.bank.

    Forward-Looking Statements

    This press release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, with respect to the Corporation’s financial condition, liquidity, results of operations, future performance and business. These forward-looking statements are intended to be covered by the safe harbor for “forward-looking statements” provided by the Private Securities Litigation Reform Act of 1995. Forward-looking statements are those that are not historical facts. Forward-looking statements include statements with respect to beliefs, plans, objectives, goals, expectations, anticipations, estimates and intentions that are subject to significant risks and uncertainties and are subject to change based on various factors (some of which are beyond the Corporation’s control). Forward-looking statements often include the words “believes,” “expects,” “anticipates,” “estimates,” “forecasts,” “intends,” “plans,” “targets,” “potentially,” “probably,” “projects,” “outlook” or similar expressions or future conditional verbs such as “may,” “will,” “should,” “would” and “could.” The Corporation’s actual results may differ materially from those contemplated by the forward-looking statements, which are neither statements of historical fact nor guarantees or assurances of future performance. Such known and unknown risks, uncertainties and other factors that could cause the actual results to differ materially from the statements, include, but are not limited to, (i) adverse changes or conditions in capital and financial markets, including actual or potential stresses in the banking industry; (ii) changes in interest rates; (iii) the credit risks of lending activities, including our ability to estimate credit losses and the allowance for credit losses, as well as the effects of changes in the level of, and trends in, loan delinquencies and write-offs; (iv) effectiveness of our data security controls in the face of cyber attacks and any reputational risks following a cybersecurity incident; (v) changes in general business, industry or economic conditions or competition; (vi) changes in any applicable law, rule, regulation, policy, guideline or practice governing or affecting financial holding companies and their subsidiaries or with respect to tax or accounting principles or otherwise; (vii) adverse economic effects from international trade disputes, including threatened or implemented tariffs imposed by the U.S. and threatened or implemented tariffs imposed by foreign countries in retaliation, or similar events impacting economic activity; (viii) the possibility that CNB and ESSA may be unable to achieve expected synergies and operating efficiencies in the merger within the executed timeframes or at all or to successfully integrate ESSA operations and those of CNB; (ix) higher than expected costs or other difficulties related to integration of combined or merged businesses; (x) the effects of business combinations and other acquisition transactions, including the inability to realize our loan and investment portfolios; (xi) changes in the quality or composition of our loan and investment portfolios; (xii) adequacy of loan loss reserves; (xiii) increased competition; (xiv) loss of certain key officers; (xv) deposit attrition; (xvi) rapidly changing technology; (xvii) unanticipated regulatory or judicial proceedings and liabilities and other costs; (xviii) changes in the cost of funds, demand for loan products or demand for financial services; and (xix) other economic, competitive, governmental or technological factors affecting our operations, markets, products, services and prices. Such developments could have an adverse impact on the Corporation’s financial position and results of operations. For more information about factors that could cause actual results to differ from those discussed in the forward-looking statements, please refer to the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of and the forward-looking statement disclaimers in the Corporation’s annual and quarterly reports filed with the Securities and Exchange Commission.

    The forward-looking statements are based upon management’s beliefs and assumptions and are made as of the date of this press release. Factors or events that could cause the Corporation’s actual results to differ may emerge from time to time, and it is not possible for the Corporation to predict all of them. The Corporation undertakes no obligation to publicly update or revise any forward-looking statements included in this press release or to update the reasons why actual results could differ from those contained in such statements, whether as a result of new information, future events or otherwise, except to the extent required by law. In light of these risks, uncertainties and assumptions, the forward-looking events discussed in this press release might not occur and you should not put undue reliance on any forward-looking statements.

    CNB FINANCIAL CORPORATION
    CONSOLIDATED FINANCIAL DATA
    Unaudited
    (dollars in thousands, except per share data)

      Three Months Ended   Six Months Ended
      June 30,
    2025    		   March 31,
    2025    		   June 30,
    2024    		   June 30,
    2025    		   June 30,
    2024
    Income Statement                  
    Interest and fees on loans $ 75,408     $ 72,379     $ 72,142     $ 147,787     $ 143,655  
    Interest and dividends on securities and cash and cash equivalents   10,363       10,000       8,510       20,363       14,902  
    Interest expense   (33,574 )     (33,948 )     (34,935 )     (67,522 )     (67,618 )
    Net interest income   52,197       48,431       45,717       100,628       90,939  
    Provision for credit losses   4,338       1,556       2,591       5,894       3,911  
    Net interest income after provision for credit losses   47,859       46,875       43,126       94,734       87,028  
    Non-interest income                  
    Wealth and asset management fees   2,109       1,796       2,007       3,905       3,809  
    Service charges on deposit accounts   1,656       1,714       1,794       3,370       3,488  
    Other service charges and fees   427       510       712       937       1,407  
    Net realized gains on available-for-sale securities   —       —       —       —       —  
    Net realized and unrealized gains (losses) on equity securities   567       (249 )     (80 )     318       111  
    Mortgage banking   172       96       187       268       383  
    Bank owned life insurance   976       760       784       1,736       1,551  
    Card processing and interchange income   2,278       2,107       2,187       4,385       4,203  
    Other non-interest income   823       1,773       1,274       2,596       2,868  
    Total non-interest income   9,008       8,507       8,865       17,515       17,820  
    Non-interest expenses                  
    Salaries and benefits   19,348       20,564       17,676       39,912       36,463  
    Net occupancy expense of premises   4,032       4,038       3,580       8,070       7,220  
    Technology expense   5,462       5,378       5,573       10,840       10,645  
    Advertising expense   556       514       553       1,070       1,238  
    State and local taxes   1,301       1,292       1,237       2,593       2,380  
    Legal, professional, and examination fees   997       849       1,119       1,846       2,291  
    FDIC insurance premiums   937       985       1,018       1,922       2,008  
    Card processing and interchange expenses   1,253       1,160       878       2,413       2,057  
    Merger costs   357       1,529       —       1,886       —  
    Other non-interest expense   5,374       4,729       4,355       10,103       9,111  
    Total non-interest expenses   39,617       41,038       35,989       80,655       73,413  
    Income before income taxes   17,250       14,344       16,002       31,594       31,435  
    Income tax expense   3,294       2,863       3,045       6,157       5,878  
    Net income   13,956       11,481       12,957       25,437       25,557  
    Preferred stock dividends   1,075       1,075       1,075       2,150       2,150  
    Net income available to common shareholders $ 12,881     $ 10,406     $ 11,882     $ 23,287     $ 23,407  
                       
    Ending shares outstanding   21,119,894       20,980,245       20,998,117       21,119,894       20,980,245  
    Average diluted common shares outstanding   20,952,891       20,925,388       20,893,396       20,939,424       20,890,203  
    Diluted earnings per common share $ 0.61     $ 0.50     $ 0.56     $ 1.10     $ 1.11  
    Adjusted diluted earnings per common share, net of merger costs (non-GAAP)(1) $ 0.63     $ 0.57     $ 0.56     $ 1.19     $ 1.11  
    Cash dividends per common share $ 0.180     $ 0.180     $ 0.175     $ 0.360     $ 0.350  
    Dividend payout ratio   30 %     36 %     31 %     33 %     32 %
    Adjusted dividend payout ratio, net of merger costs (non-GAAP)(1)   29 %     32 %     31 %     30 %     32 %
     

    CNB FINANCIAL CORPORATION
    CONSOLIDATED FINANCIAL DATA
    Unaudited
    (dollars in thousands, except per share data)

      Three Months Ended   Six Months Ended
      June 30,
    2025    		   March 31,
    2025    		   June 30,
    2024    		   June 30,
    2025    		   June 30,
    2024
    Average Balances                  
    Total loans and loans held for sale $ 4,668,051     $ 4,591,395     $ 4,441,633     $ 4,629,956     $ 4,435,246  
    Investment securities   803,082       798,427       734,087       800,722       732,710  
    Total earning assets   5,817,121       5,803,526       5,465,645       5,810,364       5,407,954  
    Total assets   6,235,036       6,220,575       5,854,978       6,227,901       5,792,485  
    Noninterest-bearing deposits   829,328       814,441       761,270       821,927       749,124  
    Interest-bearing deposits   4,558,732       4,574,700       4,321,678       4,566,673       4,275,406  
    Shareholders’ equity   633,848       619,409       583,221       626,739       579,991  
    Tangible common shareholders’ equity (non-GAAP)(1)   532,005       517,550       481,309       524,888       478,069  
                       
    Average Yields (annualized)                  
    Total loans and loans held for sale   6.50 %     6.41 %     6.55 %     6.46 %     6.53 %
    Investment securities   2.83 %     2.75 %     2.14 %     2.79 %     2.08 %
    Total earning assets   5.89 %     5.73 %     5.89 %     5.81 %     5.85 %
    Interest-bearing deposits   2.84 %     2.89 %     3.15 %     2.87 %     3.07 %
    Interest-bearing liabilities   2.88 %     2.93 %     3.17 %     2.90 %     3.10 %
                       
    Performance Ratios (annualized)                  
    Return on average assets   0.90 %     0.75 %     0.89 %     0.82 %     0.89 %
    Adjusted return on average assets, net of merger costs (non-GAAP)(1)   0.92 %     0.85 %     0.89 %     0.88 %     0.89 %
    Return on average equity   8.83 %     7.52 %     8.94 %     8.18 %     8.86 %
    Adjusted return on average equity, net of merger costs (non-GAAP)(1)   9.06 %     8.49 %     8.94 %     8.78 %     8.86 %
    Return on average tangible common equity (non-GAAP)(1)   9.71 %     8.15 %     9.93 %     8.95 %     9.85 %
    Adjusted return on average tangible common equity (non-GAAP)(1)   9.98 %     9.32 %     9.93 %     9.66 %     9.85 %
    Net interest margin, fully tax equivalent basis (non-GAAP)(1)   3.59 %     3.37 %     3.34 %     3.48 %     3.36 %
    Efficiency ratio, fully tax equivalent basis (non-GAAP)(1)   64.08 %     71.28 %     65.20 %     67.55 %     66.74 %
    Adjusted efficiency ratio, fully tax equivalent basis (non-GAAP)(1)   63.50 %     68.62 %     65.20 %     65.97 %     66.74 %
                       
    Net Loan Charge-Offs                  
    CNB Bank net loan charge-offs $ 2,848     $ 926     $ 2,348     $ 3,774     $ 3,226  
    Holiday Financial net loan charge-offs   455       513       456       968       922  
    Total Corporation net loan charge-offs $ 3,303     $ 1,439     $ 2,804     $ 4,742     $ 4,148  
    Annualized net loan charge-offs / average total loans and loans held for sale   0.28 %     0.13 %     0.25 %     0.21 %     0.19 %
     

    CNB FINANCIAL CORPORATION
    CONSOLIDATED FINANCIAL DATA
    Unaudited
    (dollars in thousands, except per share data)

      June 30,
    2025    		   March 31,
    2025    		   June 30,
    2024
    Ending Balance Sheet          
    Cash and due from banks $ 88,721     $ 68,745     $ 56,031  
    Interest-bearing deposits with Federal Reserve   332,214       447,053       271,943  
    Interest-bearing deposits with other financial institutions   4,476       4,359       3,171  
    Total cash and cash equivalents   425,411       520,157       331,145  
    Debt securities available-for-sale, at fair value   523,198       516,412       359,900  
    Debt securities held-to-maturity, at amortized cost   270,032       282,159       354,569  
    Equity securities   10,937       10,293       9,654  
    Loans held for sale   833       860       642  
    Loans receivable          
    Syndicated loans   78,936       69,189       53,938  
    Loans   4,654,484       4,540,820       4,425,754  
    Total loans receivable   4,733,420       4,610,009       4,479,692  
    Less: allowance for credit losses   (48,329 )     (47,357 )     (45,532 )
    Net loans receivable   4,685,091       4,562,652       4,434,160  
    Goodwill and other intangibles   43,874       43,874       43,874  
    Core deposit intangible   173       190       241  
    Other assets   358,928       358,911       352,386  
    Total Assets $ 6,318,477     $ 6,295,508     $ 5,886,571  
               
    Noninterest-bearing demand deposits $ 855,788     $ 842,398     $ 762,918  
    Interest-bearing demand deposits   698,902       719,460       693,074  
    Savings   3,162,515       3,160,618       3,140,505  
    Certificates of deposit   749,877       737,602       514,348  
    Total deposits   5,467,082       5,460,078       5,110,845  
    Subordinated debentures   20,620       20,620       20,620  
    Subordinated notes, net of issuance costs   84,722       84,646       84,419  
    Other liabilities   108,772       105,656       83,987  
    Total liabilities   5,681,196       5,671,000       5,299,871  
    Common stock   —       —       —  
    Preferred stock   57,785       57,785       57,785  
    Additional paid in capital   218,375       220,254       218,756  
    Retained earnings   397,004       387,925       361,987  
    Treasury stock   (2,420 )     (4,944 )     (4,438 )
    Accumulated other comprehensive loss   (33,463 )     (36,512 )     (47,390 )
    Total shareholders’ equity   637,281       624,508       586,700  
    Total liabilities and shareholders’ equity $ 6,318,477     $ 6,295,508     $ 5,886,571  
               
    Book value per common share $ 27.44     $ 27.01     $ 25.19  
    Adjusted book value per common share (non-GAAP)(1) $ 27.53     $ 27.08     $ 25.19  
    Tangible book value per common share (non-GAAP)(1) $ 25.35     $ 24.91     $ 23.09  
    Adjusted tangible book value per common share (non-GAAP)(1) $ 25.44     $ 24.98     $ 23.09  
                           

    CNB FINANCIAL CORPORATION
    CONSOLIDATED FINANCIAL DATA
    Unaudited
    (dollars in thousands, except per share data)

      June 30,
    2025    		   March 31,
    2025    		   June 30,
    2024
    Capital Ratios          
    Tangible common equity / tangible assets (non-GAAP)(1)   8.53 %     8.36 %     8.30 %
    Adjusted tangible common equity / tangible assets (non-GAAP)(1)   8.56 %     8.38 %     8.30 %
    Tier 1 leverage ratio(2)   10.42 %     10.27 %     10.56 %
    Common equity tier 1 ratio(2)   11.78 %     11.85 %     11.71 %
    Tier 1 risk-based ratio(2)   13.38 %     13.50 %     13.41 %
    Total risk-based ratio(2)   16.14 %     16.30 %     16.20 %
               
    Asset Quality Detail          
    Nonaccrual loans $ 28,509     $ 54,079     $ 34,788  
    Loans 90+ days past due and accruing   256       308       112  
    Total nonperforming loans   28,765       54,387       34,900  
    Other real estate owned   1,624       1,664       1,641  
    Total nonperforming assets $ 30,389     $ 56,051     $ 36,541  
               
    Asset Quality Ratios          
    Nonperforming assets / Total loans + OREO   0.64 %     1.22 %     0.82 %
    Nonperforming assets / Total assets   0.48 %     0.89 %     0.62 %
    Ratio of allowance for credit losses on loans to nonaccrual loans   169.52 %     87.57 %     130.88 %
    Allowance for credit losses / Total loans   1.02 %     1.03 %     1.02 %
               
               
    Consolidated Financial Data Notes:          
    (1) Management uses non-GAAP financial information in its analysis of the Corporation’s performance. Management believes that these non-GAAP measures provide a greater understanding of ongoing operations, enhance comparability of results of operations with prior periods and show the effects of significant gains and charges in the periods presented. The Corporation’s management believes that investors may use these non-GAAP measures to analyze the Corporation’s financial performance without the impact of unusual items or events that may obscure trends in the Corporation’s underlying performance. This non-GAAP data should be considered in addition to results prepared in accordance with GAAP, and is not a substitute for, or superior to, GAAP results. Limitations associated with non-GAAP financial measures include the risks that persons might disagree as to the appropriateness of items included in these measures and that different companies might calculate these measures differently. A reconciliation of these non-GAAP financial measures is provided below (dollars in thousands, except per share data).
    (2) Capital ratios as of June 30, 2025 are estimated pending final regulatory filings.
     

    CNB FINANCIAL CORPORATION
    CONSOLIDATED FINANCIAL DATA
    Unaudited
    (dollars in thousands, except per share data)

      Average Balances, Income and Interest Rates on a Taxable Equivalent Basis
      Three Months Ended,
      June 30, 2025   March 31, 2025   June 30, 2024
      Average
    Balance    		   Annual
    Rate    		   Interest
    Inc./Exp.    		   Average
    Balance    		   Annual
    Rate    		   Interest
    Inc./Exp.    		   Average
    Balance    		   Annual
    Rate    		   Interest
    Inc./Exp.
    ASSETS:                                  
    Securities:                                  
    Taxable(1) (4) $ 771,152     2.82 %   $ 5,696   $ 765,654     2.73 %   $ 5,461   $ 702,036     2.09 %   $ 3,941
    Tax-exempt(1) (2) (4)   24,260     2.64       174     25,345     2.69       181     25,088     2.59       178
    Equity securities(1) (2)   7,670     5.44       104     7,428     5.84       107     6,963     5.72       99
    Total securities(4)   803,082     2.83       5,974     798,427     2.75       5,749     734,087     2.14       4,218
    Loans receivable:                                  
    Commercial(2) (3)   1,473,560     6.71       24,664     1,466,323     6.74       24,369     1,416,476     6.85       24,133
    Commercial & residential mortgages and loans held for sale(2) (3)   3,068,519     6.18       47,295     3,001,317     6.02       44,572     2,897,473     6.15       44,331
    Consumer(3)   125,972     11.72       3,681     123,755     12.01       3,665     127,684     12.17       3,863
    Total loans receivable(3)   4,668,051     6.50       75,640     4,591,395     6.41       72,606     4,441,633     6.55       72,327
    Interest-bearing deposits with the Federal Reserve and other financial institutions   345,988     5.13       4,422     413,704     4.20       4,284     289,925     5.99       4,321
    Total earning assets   5,817,121     5.89     $ 86,036     5,803,526     5.73     $ 82,639     5,465,645     5.89     $ 80,866
    Noninterest-bearing assets:                                  
    Cash and due from banks   58,530               58,152               53,710          
    Premises and equipment   129,093               129,188               112,386          
    Other assets   277,241               277,051               268,930          
    Allowance for credit losses   (46,949 )             (47,342 )             (45,693 )        
    Total non interest-bearing assets   417,915               417,049               389,333          
    TOTAL ASSETS $ 6,235,036             $ 6,220,575             $ 5,854,978          
    LIABILITIES AND SHAREHOLDERS’ EQUITY:                                  
    Demand—interest-bearing $ 707,932     0.97 %   $ 1,719   $ 704,874     0.88 %   $ 1,527   $ 713,431     0.76 %   $ 1,342
    Savings   3,107,520     3.01       23,286     3,131,697     3.09       23,840     3,097,598     3.57       27,464
    Time   743,280     3.92       7,271     738,129     3.99       7,267     510,649     3.93       4,988
    Total interest-bearing deposits   4,558,732     2.84       32,276     4,574,700     2.89       32,634     4,321,678     3.15       33,794
    Short-term borrowings   —     —       —     —     —       —     —     0.00       —
    Finance lease liabilities   16,861     5.28       222     15,143     6.32       236     259     4.66       3
    Subordinated notes and debentures   105,304     4.10       1,076     105,228     4.15       1,078     105,001     4.36       1,138
    Total interest-bearing liabilities   4,680,897     2.88     $ 33,574     4,695,071     2.93     $ 33,948     4,426,938     3.17     $ 34,935
    Demand—noninterest-bearing   829,328               814,441               761,270          
    Other liabilities   90,963               91,654               83,549          
    Total Liabilities   5,601,188               5,601,166               5,271,757          
    Shareholders’ equity   633,848               619,409               583,221          
    TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY $ 6,235,036             $ 6,220,575             $ 5,854,978          
    Interest income/Earning assets     5.89 %   $ 86,036       5.73 %   $ 82,639       5.89 %   $ 80,866
    Interest expense/Interest-bearing liabilities     2.88       33,574       2.93       33,948       3.17       34,935
    Net interest spread     3.01 %   $ 52,462       2.80 %   $ 48,691       2.72 %   $ 45,931
    Interest income/Earning assets     5.89 %     86,036       5.73 %     82,639       5.89 %     80,866
    Interest expense/Earning assets     2.30       33,574       2.36       33,948       2.55       34,935
    Net interest margin (fully tax-equivalent)     3.59 %   $ 52,462       3.37 %   $ 48,691       3.34 %   $ 45,931
    (1 ) Includes unamortized discounts and premiums.
    (2 ) Average yields are stated on a fully taxable equivalent basis (calculated using statutory rates of 21%) resulting from tax-free municipal securities in the investment portfolio and tax-free municipal loans in the commercial loan portfolio. The taxable equivalent adjustment to net interest income for the three months ended June 30, 2025, March 31, 2025 and June 30, 2024 was $265 thousand, $260 thousand and $214 thousand, respectively.
    (3 ) Average loans receivable outstanding includes the average balance outstanding of all nonaccrual loans. Loans receivable consist of the average of total loans receivable less average unearned income. In addition, loans receivable interest income consists of loans receivable fees, including PPP deferred processing fees.
    (4 ) Average balance is computed using the fair value of AFS securities and amortized cost of HTM securities. Average yield has been computed using amortized cost average balance for AFS and HTM securities. The adjustment to the average balance for securities in the calculation of average yield for the three months ended June 30, 2025, March 31, 2025 and June 30, 2024 was $(42.6) million, $(48.1) million and $(59.2) million, respectively.
       

    CNB FINANCIAL CORPORATION
    CONSOLIDATED FINANCIAL DATA
    Unaudited
    (dollars in thousands, except per share data)

      Average Balances, Income and Interest Rates on a Taxable Equivalent Basis
      Six Months Ended,
      June 30, 2025   June 30, 2024
      Average
    Balance    		   Annual
    Rate    		   Interest
    Inc./Exp.    		   Average
    Balance    		   Annual
    Rate    		   Interest
    Inc./Exp.
    ASSETS:                      
    Securities:                      
    Taxable(1) (4) $ 768,379     2.77 %   $ 11,157   $ 699,431     2.02 %   $ 7,592
    Tax-exempt(1) (2) (4)   24,800     2.66       354     26,415     2.59       369
    Equity securities(1) (2)   7,543     5.64       211     6,864     5.68       194
    Total securities(4)   800,722     2.79       11,722     732,710     2.08       8,155
    Loans receivable:                      
    Commercial(2) (3)   1,469,962     6.73       49,033     1,423,097     6.88       48,652
    Commercial & residential mortgages and loans held for sale(2) (3)   3,035,103     6.10       91,868     2,883,824     6.12       87,734
    Consumer(3)   124,891     11.86       7,346     128,325     11.97       7,641
    Total loans receivable(3)   4,629,956     6.46       148,247     4,435,246     6.53       144,027
    Interest-bearing deposits with the Federal Reserve and other financial institutions   379,686     4.62       8,706     239,998     5.70       6,806
    Total earning assets   5,810,364     5.81     $ 168,675     5,407,954     5.85     $ 158,988
    Noninterest-bearing assets:                      
    Cash and due from banks   58,337               53,611          
    Premises and equipment   129,141               111,199          
    Other assets   277,203               265,453          
    Allowance for credit losses   (47,144 )             (45,732 )        
    Total non interest-bearing assets   417,537               384,531          
    TOTAL ASSETS $ 6,227,901             $ 5,792,485          
    LIABILITIES AND SHAREHOLDERS’ EQUITY:                      
    Demand—interest-bearing $ 706,412     0.93 %   $ 3,246   $ 726,681     0.70 %   $ 2,537
    Savings   3,119,542     3.05       47,126     3,031,438     3.52       53,075
    Time   740,719     3.96       14,538     517,287     3.78       9,730
    Total interest-bearing deposits   4,566,673     2.87       64,910     4,275,406     3.07       65,342
    Short-term borrowings   —     —       —     —     —       —
    Finance lease liabilities   16,005     5.77       458     271     4.45       6
    Subordinated notes and debentures   105,266     4.13       2,154     104,963     4.35       2,270
    Total interest-bearing liabilities   4,687,944     2.90     $ 67,522     4,380,640     3.10     $ 67,618
    Demand—noninterest-bearing   821,927               749,124          
    Other liabilities   91,291               82,730          
    Total Liabilities   5,601,162               5,212,494          
    Shareholders’ equity   626,739               579,991          
    TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY $ 6,227,901             $ 5,792,485          
    Interest income/Earning assets     5.81 %   $ 168,675       5.85 %   $ 158,988
    Interest expense/Interest-bearing liabilities     2.90       67,522       3.10       67,618
    Net interest spread     2.91 %   $ 101,153       2.75 %   $ 91,370
    Interest income/Earning assets     5.81 %     168,675       5.85 %     158,988
    Interest expense/Earning assets     2.33       67,522       2.49       67,618
    Net interest margin (fully tax-equivalent)     3.48 %   $ 101,153       3.36 %   $ 91,370
    (1 ) Includes unamortized discounts and premiums.
    (2 ) Average yields are stated on a fully taxable equivalent basis (calculated using statutory rates of 21%) resulting from tax-free municipal securities in the investment portfolio and tax-free municipal loans in the commercial loan portfolio. The taxable equivalent adjustment to net interest income for the six months ended June 30, 2025 and 2024, was $525 thousand and $431 thousand, respectively.
    (3 ) Average loans receivable outstanding includes the average balance outstanding of all nonaccrual loans. Loans receivable consist of the average of total loans receivable less average unearned income. In addition, loans receivable interest income consists of loans receivable fees, including PPP deferred processing fees.
    (4 ) Average balance is computed using the fair value of AFS securities and amortized cost of HTM securities. Average yield has been computed using amortized cost average balance for AFS and HTM securities. The adjustment to the average balance for securities in the calculation of average yield for the six months ended June 30, 2025 and 2024 was $(45.3) million and $(57.2) million, respectively.
       

     

    CNB FINANCIAL CORPORATION
    CONSOLIDATED FINANCIAL DATA
    Unaudited
    (dollars in thousands, except per share data)

    Reconciliation of Non-GAAP Financial Measures

      Three Months Ended   Six Months Ended
      June 30,
    2025    		   March 31,
    2025    		   June 30,
    2024    		   June 30,
    2025    		   June 30,
    2024
    Calculation of merger costs, net of tax (non-GAAP):                  
    Merger costs – non deductible $ 357     $ 1,327     $ —     $ 1,684     $ —  
                       
    Merger costs – deductible   —       202       —       202       —  
    Statutory federal tax rate   21 %     21 %     21 %     21 %     21 %
    Tax benefit of merger costs (non-GAAP)   —       42       —       42       —  
    Merger costs – deductible, net of tax   —       160       —       160       —  
                       
    Merger costs, net of tax (non-GAAP) $ 357     $ 1,487     $ —     $ 1,844     $ —  
      Three Months Ended   Six Months Ended
      June 30,
    2025    		   March 31,
    2025    		   June 30,
    2024    		   June 30,
    2025    		   June 30,
    2024
    Calculation of net income available to common (GAAP):                  
    Net income $ 13,956   $ 11,481   $ 12,957   $ 25,437   $ 25,557
    Less: preferred stock dividends   1,075     1,075     1,075     2,150     2,150
    Net income available to common shareholders $ 12,881   $ 10,406   $ 11,882   $ 23,287   $ 23,407
                       
    Adjusted calculation of net income available to common (non-GAAP):                  
    Net income available to common shareholders $ 12,881   $ 10,406   $ 11,882   $ 23,287   $ 23,407
    Add: Merger costs, net of tax (non-GAAP)   357     1,487     —     1,844     —
    Adjusted net income available to common shareholders (non-GAAP) $ 13,238   $ 11,893   $ 11,882   $ 25,131   $ 23,407
      Three Months Ended   Six Months Ended
      June 30,
    2025    		   March 31,
    2025    		   June 30,
    2024    		   June 30,
    2025    		   June 30,
    2024
    Calculation of PPNR (non-GAAP):(1)                  
    Net interest income $ 52,197   $ 48,431   $ 45,717   $ 100,628   $ 90,939
    Add: Non-interest income   9,008     8,507     8,865     17,515     17,820
    Less: Non-interest expense   39,617     41,038     35,989     80,655     73,413
    PPNR (non-GAAP) $ 21,588   $ 15,900   $ 18,593   $ 37,488   $ 35,346
                       
    Adjusted calculation of PPNR (non-GAAP):(1)                  
    Net interest income $ 52,197   $ 48,431   $ 45,717   $ 100,628   $ 90,939
    Add: Non-interest income   9,008     8,507     8,865     17,515     17,820
    Less: Non-interest expense   39,617     41,038     35,989     80,655     73,413
    Add: Merger costs   357     1,529     —     1,886     —
    Adjusted PPNR (non-GAAP) $ 21,945   $ 17,429   $ 18,593   $ 39,374   $ 35,346
                       
    (1) Management believes that this is an important metric as it illustrates the underlying performance of the Corporation, it enables investors and others to assess the Corporation’s ability to generate capital to cover credit losses through the credit cycle and provides consistent reporting with a key metric used by bank regulatory agencies.
     

    CNB FINANCIAL CORPORATION
    CONSOLIDATED FINANCIAL DATA
    Unaudited
    (dollars in thousands, except per share data)

    Reconciliation of Non-GAAP Financial Measures

      Three Months Ended   Six Months Ended
      June 30,
    2025    		   March 31,
    2025    		   June 30,
    2024    		   June 30,
    2025    		   June 30,
    2024
    Basic earnings per common share computation:                  
    Net income available to common shareholders $ 12,881   $ 10,406   $ 11,882   $ 23,287   $ 23,407
    Less: net income available to common shareholders allocated to participating securities   120     57     101     199     192
    Net income available to common shareholders allocated to common stock $ 12,761   $ 10,349   $ 11,781   $ 23,088   $ 23,215
                       
    Weighted average common shares outstanding, including shares considered participating securities   21,053     20,981     21,005     21,018     20,992
    Less: Average participating securities   172     114     174     144     165
    Weighted average shares   20,881     20,867     20,831     20,874     20,827
    Basic earnings per common share $ 0.61   $ 0.50   $ 0.57   $ 1.11   $ 1.12
                       
    Diluted earnings per common share computation:                  
    Net income available to common shareholders allocated to common stock $ 12,761   $ 10,349   $ 11,781   $ 23,088   $ 23,215
                       
    Weighted average common shares outstanding for basic earnings per common share   20,881     20,867     20,831     20,874     20,827
    Add: Dilutive effect of stock compensation   72     58     62     65     63
    Weighted average shares and dilutive potential common shares   20,953     20,925     20,893     20,939     20,890
    Diluted earnings per common share $ 0.61   $ 0.50   $ 0.56   $ 1.10   $ 1.11
                       
    Adjusted basic earnings per common share computation (non-GAAP):                  
    Net income available to common shareholders $ 12,881   $ 10,406   $ 11,882   $ 23,287   $ 23,407
    Add: Merger costs, net of tax (non-GAAP)   357     1,487     —     1,844     —
    Less: net income available to common shareholders allocated to participating securities   120     57     101     199     192
    Less: Adjustment to net income available to common shareholders allocated to participating securities for merger cost impact, net of tax (non-GAAP)   3     8     —     12     —
    Adjusted net income available to common shareholders allocated to common stock (non-GAAP) $ 13,115   $ 11,828   $ 11,781   $ 24,920   $ 23,215
                       
    Weighted average common shares outstanding, including shares considered participating securities   21,053     20,981     21,005     21,018     20,992
    Less: Average participating securities   172     114     174     144     165
    Weighted average shares   20,881     20,867     20,831     20,874     20,827
    Adjusted basic earnings per common share (non-GAAP) $ 0.63   $ 0.57   $ 0.57   $ 1.19   $ 1.12
                       
    Adjusted diluted earnings per common share computation (non-GAAP):                  
    Adjusted net income available to common shareholders allocated to common stock (non-GAAP) $ 13,115   $ 11,828   $ 11,781   $ 24,920   $ 23,215
                       
    Weighted average common shares outstanding for basic earnings per common share   20,881     20,867     20,831     20,874     20,827
    Add: Dilutive effect of stock compensation   72     58     62     65     63
    Weighted average shares and dilutive potential common shares   20,953     20,925     20,893     20,939     20,890
    Adjusted diluted earnings per common share (non-GAAP) $ 0.63   $ 0.57   $ 0.56   $ 1.19   $ 1.11
                                 

    CNB FINANCIAL CORPORATION
    CONSOLIDATED FINANCIAL DATA
    Unaudited
    (dollars in thousands, except per share data)

    Reconciliation of Non-GAAP Financial Measures

      Three Months Ended   Six Months Ended
      June 30,
    2025    		   March 31,
    2025    		   June 30,
    2024    		   June 30,
    2025    		   June 30,
    2024
    Calculation of dividend payout ratio:                  
    Cash dividends per common share $ 0.180     $ 0.180     $ 0.175     $ 0.360     $ 0.350  
    Diluted earnings per common share   0.61       0.50       0.56       1.10       1.11  
    Dividend payout ratio   30 %     36 %     31 %     33 %     32 %
                       
    Adjusted calculation of dividend payout ratio (non-GAAP):                  
    Cash dividends per common share $ 0.180     $ 0.180     $ 0.175     $ 0.360     $ 0.350  
    Adjusted diluted earnings per common share (non-GAAP)   0.63       0.57       0.56       1.19       1.11  
    Adjusted dividend payout ratio (non-GAAP)   29 %     32 %     31 %     30 %     32 %
      Three Months Ended   Six Months Ended
      June 30,
    2025    		   March 31,
    2025    		   June 30,
    2024    		   June 30,
    2025    		   June 30,
    2024
    Calculation of net interest margin:                  
    Interest income $ 85,771     $ 82,379     $ 80,652     $ 168,150     $ 158,557  
    Interest expense   33,574       33,948       34,935       67,522       67,618  
    Net interest income $ 52,197     $ 48,431     $ 45,717     $ 100,628     $ 90,939  
                       
    Average total earning assets $ 5,817,121     $ 5,803,526     $ 5,465,645     $ 5,810,364     $ 5,407,954  
                       
    Net interest margin (GAAP) (annualized)   3.60 %     3.38 %     3.36 %     3.49 %     3.38 %
                       
    Calculation of net interest margin (fully tax equivalent basis) (non-GAAP):                  
    Interest income $ 85,771     $ 82,379     $ 80,652     $ 168,150     $ 158,557  
    Tax equivalent adjustment (non-GAAP)   265       260       214       525       431  
    Adjusted interest income (fully tax equivalent basis) (non-GAAP)   86,036       82,639       80,866       168,675       158,988  
    Interest expense   33,574       33,948       34,935       67,522       67,618  
    Net interest income (fully tax equivalent basis) (non-GAAP) $ 52,462     $ 48,691     $ 45,931     $ 101,153     $ 91,370  
                       
    Average total earning assets $ 5,817,121     $ 5,803,526     $ 5,465,645     $ 5,810,364     $ 5,407,954  
    Less: average mark to market adjustment on investments (non-GAAP)   (42,592 )     (48,070 )     (59,225 )     (45,317 )     (57,186 )
    Adjusted average total earning assets, net of mark to market (non-GAAP) $ 5,859,713     $ 5,851,596     $ 5,524,870     $ 5,855,681     $ 5,465,140  
                       
    Net interest margin, fully tax equivalent basis (non-GAAP) (annualized)   3.59 %     3.37 %     3.34 %     3.48 %     3.36 %
                                           

    CNB FINANCIAL CORPORATION
    CONSOLIDATED FINANCIAL DATA
    Unaudited
    (dollars in thousands, except per share data)

    Reconciliation of Non-GAAP Financial Measures

      June 30,
    2025    		   March 31,
    2025    		   June 30,
    2024
    Calculation of tangible book value per common share and tangible common
    equity / tangible assets (non-GAAP):    		          
    Shareholders’ equity $ 637,281     $ 624,508     $ 586,700  
    Less: preferred equity   57,785       57,785       57,785  
    Common shareholders’ equity   579,496       566,723       528,915  
    Less: goodwill and other intangibles   43,874       43,874       43,874  
    Less: core deposit intangible   173       190       241  
    Tangible common equity (non-GAAP) $ 535,449     $ 522,659     $ 484,800  
               
    Total assets $ 6,318,477     $ 6,295,508     $ 5,886,571  
    Less: goodwill and other intangibles   43,874       43,874       43,874  
    Less: core deposit intangible   173       190       241  
    Tangible assets (non-GAAP) $ 6,274,430     $ 6,251,444     $ 5,842,456  
               
    Ending shares outstanding   21,119,894       20,980,245       20,998,117  
               
    Book value per common share (GAAP) $ 27.44     $ 27.01     $ 25.19  
    Tangible book value per common share (non-GAAP) $ 25.35     $ 24.91     $ 23.09  
               
    Common shareholders’ equity / Total assets (GAAP)   9.17 %     9.00 %     8.99 %
    Tangible common equity / Tangible assets (non-GAAP)   8.53 %     8.36 %     8.30 %
               
    Adjusted calculation of book value per common share (non-GAAP):          
    Common shareholders’ equity $ 579,496     $ 566,723     $ 528,915  
    Add: Merger costs, net of tax (non-GAAP)   1,844       1,487       —  
    Adjusted common shareholders’ equity (non-GAAP) $ 581,340     $ 568,210     $ 528,915  
               
    Ending shares outstanding   21,119,894       20,980,245       20,998,117  
               
    Adjusted book value per common share (non-GAAP) $ 27.53     $ 27.08     $ 25.19  
               
    Adjusted calculation of tangible book value per common share (non-GAAP):          
    Tangible common equity (non-GAAP) $ 535,449     $ 522,659     $ 484,800  
    Add: Merger costs, net of tax (non-GAAP)   1,844       1,487       —  
    Adjusted tangible common equity (non-GAAP) $ 537,293     $ 524,146     $ 484,800  
               
    Ending shares outstanding   21,119,894       20,980,245       20,998,117  
               
    Adjusted tangible book value per common share (non-GAAP) $ 25.44     $ 24.98     $ 23.09  
               
    Adjusted calculation of tangible common equity / tangible assets (non-GAAP):          
    Adjusted common shareholders’ equity (non-GAAP) $ 537,293     $ 524,146     $ 484,800  
               
    Tangible assets (non-GAAP) $ 6,274,430     $ 6,251,444     $ 5,842,456  
    Add: Merger costs (non-GAAP)   1,886       1,529       —  
    Adjusted tangible assets (non-GAAP) $ 6,276,316     $ 6,252,973     $ 5,842,456  
               
    Adjusted tangible common equity / Adjusted tangible assets (non-GAAP)   8.56 %     8.38 %     8.30 %
     

    CNB FINANCIAL CORPORATION
    CONSOLIDATED FINANCIAL DATA
    Unaudited
    (dollars in thousands, except per share data)

    Reconciliation of Non-GAAP Financial Measures

      Three Months Ended   Six Months Ended
      June 30,
    2025    		   March 31,
    2025    		   June 30,
    2024    		   June 30,
    2025    		   June 30,
    2024
    Calculation of efficiency ratio:                  
    Non-interest expense $ 39,617     $ 41,038     $ 35,989     $ 80,655     $ 73,413  
                       
    Non-interest income $ 9,008     $ 8,507     $ 8,865     $ 17,515     $ 17,820  
    Net interest income   52,197       48,431       45,717       100,628       90,939  
    Total revenue $ 61,205     $ 56,938     $ 54,582     $ 118,143     $ 108,759  
    Efficiency ratio   64.73 %     72.07 %     65.94 %     68.27 %     67.50 %
                       
    Calculation of efficiency ratio (fully tax equivalent basis) (non-GAAP):                  
    Non-interest expense $ 39,617     $ 41,038     $ 35,989     $ 80,655     $ 73,413  
    Less: core deposit intangible amortization   16       17       19       33       39  
    Adjusted non-interest expense (non-GAAP) $ 39,601     $ 41,021     $ 35,970     $ 80,622     $ 73,374  
                       
    Non-interest income $ 9,008     $ 8,507     $ 8,865     $ 17,515     $ 17,820  
                       
    Net interest income $ 52,197     $ 48,431     $ 45,717     $ 100,628     $ 90,939  
    Less: tax exempt investment and loan income, net of TEFRA (non-GAAP)   1,451       1,464       1,318       2,915       2,655  
    Add: tax exempt investment and loan income (fully tax equivalent basis) (non-GAAP)   2,046       2,076       1,902       4,122       3,834  
    Adjusted net interest income (fully tax equivalent basis) (non-GAAP)   52,792       49,043       46,301       101,835       92,118  
    Adjusted net revenue (fully tax equivalent basis) (non-GAAP) $ 61,800     $ 57,550     $ 55,166     $ 119,350     $ 109,938  
                       
    Efficiency ratio (fully tax equivalent basis) (non-GAAP)   64.08 %     71.28 %     65.20 %     67.55 %     66.74 %
                       
    Adjusted calculation of efficiency ratio (fully tax equivalent basis) (non-GAAP):                  
    Adjusted non-interest expense (non-GAAP) $ 39,601     $ 41,021     $ 35,970     $ 80,622     $ 73,374  
    Less: Merger costs (non-GAAP)   357       1,529       —       1,886       —  
    Adjusted non-interest expense (non-GAAP) $ 39,244     $ 39,492     $ 35,970     $ 78,736     $ 73,374  
                       
    Adjusted net revenue (fully tax equivalent basis) (non-GAAP) $ 61,800     $ 57,550     $ 55,166     $ 119,350     $ 109,938  
                       
    Adjusted efficiency ratio (fully tax equivalent basis) (non-GAAP)   63.50 %     68.62 %     65.20 %     65.97 %     66.74 %
                                           

    CNB FINANCIAL CORPORATION
    CONSOLIDATED FINANCIAL DATA
    Unaudited
    (dollars in thousands, except per share data)

    Reconciliation of Non-GAAP Financial Measures

      Three Months Ended   Six Months Ended
      June 30,
    2025    		   March 31,
    2025    		   June 30,
    2024    		   June 30,
    2025    		   June 30,
    2024
    Calculation of return on average assets:                  
    Net income $ 13,956     $ 11,481     $ 12,957     $ 25,437     $ 25,557  
    Average total assets $ 6,235,036     $ 6,220,575     $ 5,854,978     $ 6,227,901     $ 5,792,485  
                       
    Return on average assets (GAAP) (annualized)   0.90 %     0.75 %     0.89 %     0.82 %     0.89 %
                       
    Adjusted calculation of return on average assets (non-GAAP):                  
    Net income $ 13,956     $ 11,481     $ 12,957     $ 25,437     $ 25,557  
    Add: Merger costs, net of tax (non-GAAP)   357       1,487       —       1,844       —  
    Adjusted net income $ 14,313     $ 12,968     $ 12,957     $ 27,281     $ 25,557  
    Average total assets $ 6,235,036     $ 6,220,575     $ 5,854,978     $ 6,227,901     $ 5,792,485  
                       
    Adjusted return on average assets (non-GAAP) (annualized)   0.92 %     0.85 %     0.89 %     0.88 %     0.89 %
      June 30,
    2025    		   March 31,
    2025    		   June 30,
    2024
    Calculation of total deposits          
    Total deposits $ 5,467,082   $ 5,460,078   $ 5,110,845
               
    Adjusted calculation of total deposits (non-GAAP):          
    Total deposits $ 5,467,082   $ 5,460,078   $ 5,110,845
    Add: High cost municipal deposits   77,690     —     —
    Adjusted total deposits (non-GAAP) $ 5,544,772   $ 5,460,078   $ 5,110,845
     

    CNB FINANCIAL CORPORATION
    CONSOLIDATED FINANCIAL DATA
    Unaudited
    (dollars in thousands, except per share data)

    Reconciliation of Non-GAAP Financial Measures

      Three Months Ended   Six Months Ended
      June 30,
    2025    		   March 31,
    2025    		   June 30,
    2024    		   June 30,
    2025    		   June 30,
    2024
    Calculation of return on average tangible common equity (non-GAAP):                  
    Net income $ 13,956     $ 11,481     $ 12,957     $ 25,437     $ 25,557  
    Less: preferred stock dividends   1,075       1,075       1,075       2,150       2,150  
    Net income available to common shareholders $ 12,881     $ 10,406     $ 11,882     $ 23,287     $ 23,407  
                       
    Average shareholders’ equity $ 633,848     $ 619,409     $ 583,221     $ 626,739     $ 579,991  
    Less: average goodwill & intangibles   44,058       44,074       44,127       44,066       44,137  
    Less: average preferred equity   57,785       57,785       57,785       57,785       57,785  
    Average tangible common shareholders’ equity (non-GAAP) $ 532,005     $ 517,550     $ 481,309     $ 524,888     $ 478,069  
                       
    Return on average equity (GAAP) (annualized)   8.83 %     7.52 %     8.94 %     8.18 %     8.86 %
    Return on average common equity (GAAP) (annualized)   8.97 %     7.51 %     9.10 %     8.25 %     9.01 %
    Return on average tangible common equity (non-GAAP) (annualized)   9.71 %     8.15 %     9.93 %     8.95 %     9.85 %
                       
    Adjusted calculation of return on average equity (non-GAAP):                  
    Net income $ 13,956     $ 11,481     $ 12,957     $ 25,437     $ 25,557  
    Add: Merger costs, net of tax (non-GAAP)   357       1,487       —       1,844       —  
    Adjusted net income (non-GAAP) $ 14,313     $ 12,968     $ 12,957     $ 27,281     $ 25,557  
                       
    Average shareholders’ equity $ 633,848     $ 619,409     $ 583,221     $ 626,739     $ 579,991  
                       
    Adjusted return on average equity (non-GAAP) (annualized)   9.06 %     8.49 %     8.94 %     8.78 %     8.86 %
                       
    Adjusted calculation of return on average tangible common equity (non-GAAP):                  
    Net income available to common shareholders $ 12,881     $ 10,406     $ 11,882     $ 23,287     $ 23,407  
    Add: Merger costs, net of tax (non-GAAP)   357       1,487       —       1,844       —  
    Adjusted net income available to common shareholders $ 13,238     $ 11,893     $ 11,882     $ 25,131     $ 23,407  
                       
    Average tangible common shareholders’ equity (non-GAAP) $ 532,005     $ 517,550     $ 481,309     $ 524,888     $ 478,069  
                       
    Adjusted return on average tangible common equity (non-GAAP) (annualized)   9.98 %     9.32 %     9.93 %     9.66 %     9.85 %

    The MIL Network –

  • MIL-OSI: Western New England Bancorp, Inc. Reports Results for Three and Six Months Ended June 30, 2025 and Declares Quarterly Cash Dividend

    Source: GlobeNewswire (MIL-OSI)

    WESTFIELD, Mass., July 22, 2025 (GLOBE NEWSWIRE) — Western New England Bancorp, Inc. (the “Company” or “WNEB”) (NasdaqGS: WNEB), the holding company for Westfield Bank (the “Bank”), announced today the unaudited results of operations for the three and six months ended June 30, 2025. For the three months ended June 30, 2025, the Company reported net income of $4.6 million, or $0.23 per diluted share, compared to net income of $3.5 million, or $0.17 per diluted share, for the three months ended June 30, 2024. On a linked quarter basis, net income was $4.6 million, or $0.23 per diluted share, as compared to net income of $2.3 million, or $0.11 per diluted share, for the three months ended March 31, 2025. For the six months ended June 30, 2025, net income was $6.9 million, or $0.34 per diluted share, compared to net income of $6.5 million, or $0.31 per diluted share, for the six months ended June 30, 2024.

    The Company also announced that its Board of Directors declared a quarterly cash dividend of $0.07 per share on the Company’s common stock. The dividend will be payable on or about August 20, 2025 to shareholders of record on August 6, 2025.

    James C. Hagan, President and Chief Executive Officer, commented, “We are pleased to report solid earnings for the second quarter of 2025, along with strong overall loan growth and core deposit growth. Core deposits increased $81.4 million, or 5.2%, since year-end, which will be beneficial as we continue to lower deposit costs and reduce our reliance on time deposits. We are also pleased to report that our commercial and industrial loan portfolio increased $22.8 million, or 10.8%, during the six months ended June 30, 2025, and our residential real estate portfolio increased $29.7 million, or 3.8%, during the same period. Growth in commercial and industrial loans is a strategic priority for the Company as we remain focused on meeting the needs of our business and commercial customers.

    We believe our balance sheet structure will continue to have a positive impact on earnings in the current interest rate environment. Net interest income increased $2.1 million, or 13.6%, from the three months ended March 31, 2025 to the three months ended June 30, 2025, while the net interest margin increased 31 basis points from 2.49% to 2.80% during the same period. Our loan growth and disciplined approach to managing funding costs have allowed us to expand our net interest margin as we continue to decrease the cost of interest-bearing liabilities and our reliance on time deposits. Our asset quality remains solid, with nonperforming assets to total assets of 0.21%, and total delinquency as a percentage of total loans of 0.18%.”

    Hagan concluded, “Our capital position continues to remain strong, and the Company is considered to be well-capitalized as defined by the regulators. We remain disciplined in our capital management strategies and during the six months ended June 30, 2025, we repurchased 497,318 shares of common stock with an average price per share of $9.31. We continue to believe that buying back shares, at current prices, represents a prudent use of the Company’s capital. On April 22, 2025, we announced a new repurchase plan (the “2025 Plan”) which commenced upon the completion of the 2024 Repurchase Plan (the “2024 Plan”). On June 3, 2025, we announced the completion of the 2024 Plan, under which the Company repurchased a total of 1.0 million shares at an average price per share of $8.79. We are pleased with our second quarter results and are committed to delivering long-term value to shareholders through capital management strategies, which include continued loan growth, share repurchases and quarterly cash dividends.”

    Key Highlights:

    Loans and Deposits

    Total gross loans increased $22.1 million, or 1.1%, from $2.1 billion, or 77.9% of total assets, at December 31, 2024 to $2.1 billion, or 77.1% of total assets, at June 30, 2025. The increase in total gross loans was primarily driven by an increase in residential real estate loans, including home equity loans, of $29.7 million, or 3.8%, and an increase in commercial and industrial loans of $22.8 million, or 10.8%. These increases were partially offset by a decrease in commercial real estate loans of $29.5 million, or 2.7%, and a decrease in consumer loans of $879,000, or 20.0%.

    At June 30, 2025, total deposits of $2.3 billion increased $67.5 million, or 3.0%, from December 31, 2024. Core deposits, which the Company defines as all deposits except time deposits, increased $81.4 million, or 5.2%, from $1.6 billion, or 68.9% of total deposits, at December 31, 2024, to $1.6 billion, or 70.4% of total deposits, at June 30, 2025. Time deposits decreased $13.9 million, or 2.0%, from $703.6 million at December 31, 2024 to $689.7 million at June 30, 2025. Brokered time deposits, which are included in time deposits, totaled $1.7 million at December 31, 2024. The Company did not have brokered time deposits at June 30, 2025. The loan-to-deposit ratio decreased from 91.5% at December 31, 2024 to 89.8% at June 30, 2025.

    Allowance for Loan Losses and Credit Quality

    At June 30, 2025, the allowance for credit losses was $19.7 million, or 0.94% of total loans, compared to $19.5 million, or 0.94% of total loans, at December 31, 2024. The allowance for loan losses, as a percentage of nonaccrual loans, was 343.1% and 362.9% at June 30, 2025 and December 31, 2024, respectively. At June 30, 2025, nonaccrual loans totaled $5.8 million, or 0.27% of total loans, compared to $5.4 million, or 0.26% of total loans, at December 31, 2024. Total delinquent loans decreased from $5.0 million, or 0.24% of total loans, at December 31, 2024 to $3.9 million, or 0.18% of total loans, at June 30, 2025. At June 30, 2025 and December 31, 2024, the Company did not have any other real estate owned.

    Net Interest Margin

    The net interest margin increased 31 basis points, from 2.49% for the three months ended March 31, 2025 to 2.80% for the three months ended June 30, 2025. The net interest margin, on a tax-equivalent basis, increased 31 basis points from 2.51% for the three months ended March 31, 2025 to 2.82%, for the three months ended June 30, 2025.

    Stock Repurchase Program

    On April 22, 2025, the Board of Directors authorized the 2025 Plan, pursuant to which the Company may repurchase up to 1.0 million shares of its common stock, or approximately 4.8%, of the Company’s then-outstanding shares of common stock, upon the completion of the 2024 Plan. On June 3, 2025, the Company announced the completion of its 2024 Plan under which the Company repurchased a total of 1.0 million shares at an average price per share of $8.79.

    During the three months ended June 30, 2025, the Company repurchased 290,609 shares of its common stock at an average price per share of $9.45. During the six months ended June 30, 2025, the Company repurchased 497,318 shares of its common stock at an average price per share of $9.31. As of June 30, 2025, there were 975,000 shares of common stock available for repurchase under the 2025 Plan.

    The repurchase of shares under our 2025 Plan is administered through an independent broker. The shares of common stock repurchased under the 2025 Plan have been and will continue to be purchased from time to time at prevailing market prices, through open market or privately negotiated transactions, or otherwise, depending upon market conditions. There is no guarantee as to the exact number, or value, of shares that will be repurchased by the Company, and the Company may discontinue repurchases at any time that the Company’s management (“Management”) determines additional repurchases are not warranted. The timing and amount of additional share repurchases under the 2025 Plan will depend on a number of factors, including the Company’s stock price performance, ongoing capital planning considerations, general market conditions, and applicable legal requirements.

    Book Value and Tangible Book Value

    The Company’s book value per share was $11.68 at June 30, 2025 compared to $11.30 at December 31, 2024, while tangible book value per share, a non-GAAP financial measure, increased $0.38, or 3.6%, from $10.63 at December 31, 2024 to $11.01 at June 30, 2025. See pages 19-21 for the related tangible book value calculation and a reconciliation of GAAP to non-GAAP financial measures.

    Net Income for the Three Months Ended June 30, 2025 Compared to the Three Months Ended March 31, 2025

    For the three months ended June 30, 2025, the Company reported an increase in net income of $2.3 million, or 99.3%, from $2.3 million, or $0.11 per diluted share, for the three months ended March 31, 2025, to $4.6 million, or $0.23 per diluted share. Net interest income increased $2.1 million, or 13.6%, the provision for credit losses decreased $757,000, non-interest income increased $652,000, or 23.6%, and non-interest expense increased $472,000, or 3.1%. Return on average assets and return on average equity were 0.69% and 7.76%, respectively, for the three months ended June 30, 2025, compared to 0.35% and 3.94%, respectively, for the three months ended March 31, 2025.

    Net Interest Income and Net Interest Margin

    On a sequential quarter basis, net interest income, our primary driver of revenues, increased $2.1 million, or 13.6%, to $17.6 million for the three months ended June 30, 2025, from $15.5 million for the three months ended March 31, 2025. The increase in net interest income was primarily due to an increase in interest income of $1.2 million, or 4.1%, and a decrease in interest expense of $933,000, or 7.2%. During the three months ended June 30, 2025, the Company recorded $425,000 in prepayment penalties related to payoffs in the commercial portfolio. The $933,000, or 7.2%, decrease in interest expense was primarily due to a decrease in average rates paid on interest-bearing deposits during the three months ended June 30, 2025, compared to the three months ended March 31, 2025.

    The net interest margin was 2.80% for the three months ended June 30, 2025, compared to 2.49% for the three months ended March 31, 2025. The net interest margin, on a tax-equivalent basis, was 2.82% for the three months ended June 30, 2025, compared to 2.51% for the three months ended March 31, 2025. Excluding the prepayment penalties discussed above, the net interest margin increased 24 basis points from 2.49% for the three months ended March 31, 2025 to 2.73% for the three months ended June 30, 2025. The increase in the net interest margin was primarily due to an increase in the yield on average interest-earning assets and a decrease in the average cost of interest-bearing liabilities.

    The average yield on interest-earning assets, without the impact of tax-equivalent adjustments, increased 13 basis points from 4.56%, for the three months ended March 31, 2025 to 4.69% for the three months ended June 30, 2025. The average loan yield, without the impact of tax-equivalent adjustments, increased 16 basis points from 4.89%, for the three months ended March 31, 2025, to 5.05% for the three months ended June 30, 2025. During the same period, average loans increased $7.8 million, or 0.4%, and average securities increased $9.7 million, or 2.7%, while average short-term investments decreased $17.4 million, or 22.9%.

    The average cost of total funds, including non-interest bearing accounts and borrowings, decreased 18 basis points from 2.16% for the three months ended March 31, 2025 to 1.98% for the three months ended June 30, 2025. The average cost of core deposits, which the Company defines as all deposits except time deposits, decreased seven basis points to 1.01% for the three months ended June 30, 2025, from 1.08% for the three months ended March 31, 2025. The average cost of time deposits decreased 42 basis points from 4.11% for the three months ended March 31, 2025, to 3.69% for the three months ended June 30, 2025. The average cost of borrowings, including subordinated debt, was 5.04% for the three months ended March 31, 2025 and for the three months ended June 30, 2025. Average demand deposits, an interest-free source of funds, increased $3.2 million, or 0.6%, from $569.6 million, or 24.8%, of total average deposits, for the three months ended March 31, 2025, to $572.8 million, or 24.9% of total average deposits, for the three months ended June 30, 2025.

    (Reversal of) Provision for Credit Losses

    During the three months ended June 30, 2025, the Company recorded a reversal of credit losses of $615,000, compared to a provision for credit losses of $142,000 during the three months ended March 31, 2025. The reversal of credit losses was a result of a recovery in the amount of $624,000 on a previously charged-off commercial relationship acquired on October 21, 2016 from Chicopee Bancorp, Inc. As of June 30, 2025, the relationship has been paid in full and the Company does not expect to charge-off or recover any additional funds from the borrower. The provision for credit losses was determined by a number of factors: the continued strong credit performance of the Company’s loan portfolio, changes in the loan portfolio mix and Management’s consideration of existing economic conditions and the economic outlook from the Federal Reserve’s actions to control inflation. Management continues to monitor macroeconomic variables related to increasing interest rates, tariffs, inflation and concerns of an economic downturn, and believes it is appropriately reserved for the current economic environment.

    During the three months ended June 30, 2025, the Company recorded net recoveries of $585,000 compared to net charge-offs of $29,000 for the three months ended March 31, 2025.

    Non-Interest Income

    On a sequential quarter basis, non-interest income increased $652,000, or 23.6%, to $3.4 million for the three months ended June 30, 2025, from $2.8 million for the three months ended March 31, 2025. During the three months ended June 30, 2025, service charges and fees on deposits increased $244,000, or 10.7%, to $2.5 million from the three months ended March 31, 2025. Income from bank-owned life insurance (“BOLI”) increased $43,000, or 9.1%, from the three months ended March 31, 2025 to $516,000 for the three months ended June 30, 2025.

    During the three months ended June 30, 2025, the Company reported a gain of $4,000 from mortgage banking activities, compared to a gain of $7,000 during the three months ended March 31, 2025. During the three months ended June 30, 2025, the Company reported unrealized gains on marketable equity securities of $25,000, compared to unrealized losses of $5,000 during the three months ended March 31, 2025. During the three months ended June 30, 2025, the Company reported gains on non-marketable equity investments of $243,000 and did not have comparable income during the three months ended March 31, 2025. During the three months ended June 30, 2025, the Company reported $95,000 in other income from loan-level swap fees on commercial loans and did not have comparable income during the three months ended March 31, 2025.

    Non-Interest Expense

    For the three months ended June 30, 2025, non-interest expense increased $472,000, or 3.1%, to $15.7 million from $15.2 million for the three months ended March 31, 2025. Salaries and related benefits increased $418,000, or 5.0%, due to an increase in deferred compensation expense to reflect updated performance award estimates and a full quarter of annual salary merit increases. Debit card processing and ATM network costs increased $97,000, or 16.8%, professional fees increased $77,000, or 14.1%, data processing expense increased $51,000, or 5.8%, advertising expense increased $14,000, or 3.3%, furniture and equipment expense increased $4,000, or 0.8%, and other non-interest expense increased $4,000, or 0.3%. These increases were partially offset by a decrease in occupancy expense of $147,000, or 10.4%, primarily due to a decrease in snow removal costs of $140,000. FDIC insurance expense decreased $32,000, or 7.4%, and software related expenses decreased $14,000, or 2.1%.

    For the three months ended June 30, 2025 and the three months ended March 31, 2025, the efficiency ratio was 74.4% and 83.0%, respectively. For the three months ended June 30, 2025, the adjusted efficiency ratio, a non-GAAP financial measure, was 75.3% compared to 83.0% for the three months ended March 31, 2025. The decreases in the efficiency ratio and the adjusted efficiency ratio were driven by higher revenues during the three months ended June 30, 2025 compared to the three months ended March 31, 2025. The Company’s detailed reconciliation between the non-GAAP measure and the comparable GAAP amount are included at the end of this document. See pages 19-21 for the related adjusted efficiency ratio calculation and a reconciliation of GAAP to non-GAAP financial measures.

    Income Tax Provision

    Income tax expense for the three months ended June 30, 2025 was $1.4 million, with an effective tax rate of 23.7%, compared to $664,000, with an effective tax rate of 22.4%, for the three months ended March 31, 2025. The increase in tax expense is due to higher projected pre-tax income for the twelve months ended December 31, 2025.

    Net Income for the Three Months Ended June 30, 2025 Compared to the Three Months Ended June 30, 2024

    The Company reported an increase in net income of $1.1 million, or 30.7%, from $3.5 million, or $0.17 per diluted share, for the three months ended June 30, 2024 to $4.6 million, or $0.23 per diluted share, for the three months ended June 30, 2025. Net interest income increased $3.2 million, or 21.9%, provision for credit losses decreased $321,000, non-interest income decreased $423,000, or 11.0%, and non-interest expense increased $1.3 million, or 9.4%, during the same period. Return on average assets and return on average equity were 0.69% and 7.76%, respectively, for the three months ended June 30, 2025, compared to 0.55% and 6.03%, respectively, for the three months ended June 30, 2024.

    Net Interest Income and Net Interest Margin

    Net interest income increased $3.2 million, or 21.9%, to $17.6 million, for the three months ended June 30, 2025, from $14.5 million for the three months ended June 30, 2024. The increase in net interest income was due to an increase in interest and dividend income of $2.8 million, or 10.5%, and a decrease in interest expense of $362,000, or 2.9%. During the three months ended June 30, 2025, the Company recorded $425,000 in prepayment penalties related to payoffs in the commercial portfolio. The increase in interest income was primarily due to a $129.4 million, or 5.4%, increase in average interest-earning assets and a 20 basis point increase in the average yield on interest-earning assets, from the three months ended June 30, 2024 to the three months ended June 30, 2025.

    The net interest margin increased 38 basis points from 2.42% for the three months ended June 30, 2024 to 2.80% for the three months ended June 30, 2025. The net interest margin, on a tax-equivalent basis, was 2.82% for the three months ended June 30, 2025, compared to 2.44% for the three months ended June 30, 2024. Excluding the prepayment penalties discussed above, the net interest margin increased 31 basis points from 2.42%, for the three months ended June 30, 2024 to 2.73%, for the three months ended June 30, 2025. The increase in the net interest margin was primarily due to an increase in the average yield on interest-earning assets and a decrease in the average cost of interest-bearing liabilities.

    The average yield on interest-earning assets, without the impact of tax-equivalent adjustments, increased 20 basis points from 4.49% for the three months ended June 30, 2024 to 4.69%, for the three months ended June 30, 2025. The average loan yield, without the impact of tax-equivalent adjustments, increased 20 basis points from 4.85% for the three months ended June 30, 2024 to 5.05%, for the three months ended June 30, 2025. During the three months ended June 30, 2025, average interest-earning assets increased $129.4 million, or 5.4% to $2.5 billion, primarily due to an increase in average loans of $64.2 million, or 3.2%, an increase in average short-term investments, consisting of cash and cash equivalents, of $44.3 million, or 309.1%, and an increase in average securities of $20.2 million, or 5.7%.

    The average cost of total funds, including non-interest bearing accounts and borrowings, decreased 18 basis points from 2.16% for the three months ended June 30, 2024 to 1.98% for the three months ended June 30, 2025. The average cost of core deposits, which the Company defines as all deposits except time deposits, increased 14 basis points from 0.87% for the three months ended June 30, 2024 to 1.01% for the three months ended June 30, 2025. The average cost of time deposits decreased 70 basis points from 4.39% for the three months ended June 30, 2024 to 3.69% for the three months ended June 30, 2025. The average cost of borrowings, including subordinated debt, increased four basis points from 5.00% for the three months ended June 30, 2024 to 5.04%, for the three months ended June 30, 2025. Average demand deposits, an interest-free source of funds, increased $24.1 million, or 4.4%, from $548.8 million, or 25.7% of total average deposits, for the three months ended June 30, 2024, to $572.8 million, or 24.9% of total average deposits, for the three months ended June 30, 2025.

    Reversal of Credit Losses

    During the three months ended June, 30, 2025, the Company recorded a reversal of credit losses of $615,000, compared to a reversal of credit losses of $294,000 during the three months ended June 30, 2024. The reversal of credit losses recorded during the three months ended June 30, 2025 was a result of a recovery in the amount of $624,000 on a previously charged-off commercial relationship acquired on October 21, 2016 from Chicopee Bancorp, Inc. As of June 30, 2025, the relationship has been paid in full and the Company does not expect to charge-off or recover any additional funds from the borrower. The provision for credit losses was determined by a number of factors: the continued strong credit performance of the Company’s loan portfolio, changes in the loan portfolio mix and Management’s consideration of existing economic conditions and the economic outlook from the Federal Reserve’s actions to control inflation. Management continues to monitor macroeconomic variables related to increasing interest rates, tariffs, inflation and concerns of an economic downturn, and believes it is appropriately reserved for the current economic environment.

    The Company recorded net recoveries of $585,000 for the three months ended June 30, 2025, as compared to net charge-offs of $10,000 for the three months ended June 30, 2024.

    Non-Interest Income

    Non-interest income decreased $423,000, or 11.0%, to $3.4 million for the three months ended June 30, 2025, from $3.8 million for the three months ended June 30, 2024. During the three months ended June 30, 2025, service charges and fees on deposits increased $187,000, or 8.0%, income from BOLI increased $14,000, or 2.8%, from $502,000 for the three months ended June 30, 2024 to $516,000 for the three months ended June 30, 2025.

    During the three months ended June 30, 2025, the Company reported an unrealized gain on marketable equity securities of $25,000, compared to unrealized gain on marketable equity securities of $4,000 during the three months ended June 30, 2024. During the three months ended June 30, 2025, the Company reported a gain of $243,000 on non-marketable equity investments, compared to a gain of $987,000 on non-marketable equity investments during the three months ended June 30, 2024. During the three months ended June 30, 2025, the Company reported $95,000 in other income from loan-level swap fees on commercial loans and did not have comparable income during the three months ended June 30, 2024. During the three months ended June 30, 2025, the Company reported $4,000 in gains from mortgage banking activities and did not have comparable income during the three months ended June 30, 2024.

    Non-Interest Expense

    For the three months ended June 30, 2025, non-interest expense increased $1.3 million, or 9.4%, to $15.7 million from $14.3 million for the three months ended June 30, 2024. The increase in non-interest expense was due to an increase in salaries and benefits of $930,000, or 11.8%, an increase in advertising and marketing expense of $104,000, or 30.7%, an increase in data processing expense of $87,000, or 10.3%, an increase in software related expense of $79,000, or 14.0%, an increase in FDIC insurance expense of $76,000, or 23.5%, an increase in occupancy expense of $47,000, or 3.9%, an increase in professional fees of $42,000, or 7.2%, an increase in debit card and ATM processing fees of $31,000, or 4.8%, an increase in furniture and equipment expense of $8,000, or 1.7%, and a decrease in other non-interest expense of $62,000, or 4.4%.

    For the three months ended June 30, 2025, the efficiency ratio was 74.4%, compared to 78.2% for the three months ended June 30, 2024. For the three months ended June 30, 2025, the adjusted efficiency ratio, a non-GAAP financial measure, was 75.3% compared to 82.7% for the three months ended June 30, 2024. The decreases in the efficiency ratio and the adjusted efficiency ratio were driven by an increase in total revenues, defined as the sum of net interest income and non-interest income, during the three months ended June 30, 2025, compared to the three months ended June 30, 2024. See pages 19-21 for the related ratio calculation and a reconciliation of GAAP to non-GAAP financial measures.

    Income Tax Provision

    Income tax expense for the three months ended June 30, 2025 was $1.4 million, or an effective tax rate of 23.7%, compared to $771,000, or an effective tax rate of 18.0%, for the three months ended June 30, 2024. The increase is due to higher projected pre-tax income for the twelve months ended December 31, 2025.

    Net Income for the Six Months Ended June 30, 2025 Compared to the Six Months Ended June 30, 2024

    For the six months ended June 30, 2025, the Company reported net income of $6.9 million, or $0.34 per diluted share, compared to $6.5 million, or $0.31 per diluted share, for the six months ended June 30, 2024. Return on average assets and return on average equity were 0.52% and 5.87% for the six months ended June 30, 2025, respectively, compared to 0.51% and 5.53% for the six months ended June 30, 2024, respectively.

    Net Interest Income and Net Interest Margin

    During the six months ended June 30, 2025, net interest income increased $3.4 million, or 11.3%, to $33.2 million, compared to $29.8 million for the six months ended June 30, 2024. The increase in net interest income was due to an increase in interest income of $4.6 million, or 8.7%, partially offset by an increase in interest expense of $1.3 million, or 5.4%.

    For the six months ended June 30, 2025, the net interest margin increased 14 basis points from 2.50% for the six months ended June 30, 2024 to 2.64%. The net interest margin, on a tax-equivalent basis, was 2.66% for the six months ended June 30, 2025, compared to 2.52% for the six months ended June 30, 2024. During the six months ended June 30, 2025 and the six months ended June 30, 2024, the Company recorded $425,000 and $8,000, respectively, in prepayment penalties related to payoffs in the commercial portfolio. Excluding the prepayment penalties, the net interest margin increased 11 basis points from 2.50% for the six months ended June 30, 2024 to 2.61% for the six months ended June 30, 2025.

    The average yield on interest-earning assets, without the impact of tax-equivalent adjustments, was 4.63% for the six months ended June 30, 2025, compared to 4.47% for the six months ended June 30, 2024. The average loan yield, without the impact of tax-equivalent adjustments, was 4.97% for the six months ended June 30, 2025, compared to 4.84% for the six months ended June 30, 2024. During the six months ended June 30, 2025, average interest-earning assets increased $128.0 million, or 5.3%, to $2.5 billion, from the same period in 2024. The increase was primarily due to an increase in average loans of $58.0 million, or 2.9%, an increase in average short-term investments, consisting of cash and cash equivalents, of $55.4 million, or 467.4%, and an increase in average securities of $13.1 million, or 3.7%.

    The average cost of total funds, including non-interest bearing accounts and borrowings, was 2.07% for each of the six months ended June 30, 2025 and June 30, 2024. The average cost of core deposits, which the Company defines as all deposits except time deposits, increased 23 basis points to 1.05% for the six months ended June 30, 2025, from 0.82% for the six months ended June 30, 2024. The average cost of time deposits decreased 36 basis points from 4.26% for the six months ended June 30, 2024 to 3.90% for the six months ended June 30, 2025. The average cost of borrowings, including subordinated debt, increased eight basis points from 4.96% for the six months ended June 30, 2024 to 5.04% for the six months ended June 30, 2025. Average demand deposits, an interest-free source of funds, increased $18.0 million, or 3.3%, from $553.2 million, or 25.9% of total average deposits, for the six months ended June 30, 2024 to $571.2 million, or 24.8% of total average deposits, for the six months ended June 30, 2025.

    Reversal of Credit Losses

    During the six months ended June 30, 2025, the Company recorded a reversal of credit losses of $473,000, compared to a reversal of credit losses of $844,000 during the six months ended June 30, 2024. The decrease was primarily due to changes in the loan mix as well as economic environment and related adjustments to the quantitative components of the CECL methodology. The provision for credit losses was determined by a number of factors: the continued strong credit performance of the Company’s loan portfolio, changes in the loan portfolio mix and Management’s consideration of existing economic conditions and the economic outlook from the Federal Reserve’s actions to control inflation. Management continues to monitor macroeconomic variables related to increasing interest rates, tariffs, inflation and concerns of an economic downturn, and believes it is appropriately reserved for the current economic environment.

    The Company recorded net recoveries of $556,000 for the six months ended June 30, 2025, as compared to net recoveries of $57,000 for the six months ended June 30, 2024. During the six months ended June 30, 2025, the Company recorded a recovery of $624,000 on a previously charged-off commercial relationship acquired on October 21, 2016 from Chicopee Bancorp, Inc. As of June 30, 2025, the relationship has been paid in full and the Company does not expect to charge-off or recover any additional funds from the borrower.

    Non-Interest Income

    For the six months ended June 30, 2025, non-interest income decreased $338,000, or 5.2%, from $6.5 million during the six months ended June 30, 2024 to $6.2 million. During the same period, service charges and fees on deposits increased $252,000, or 5.5%, and income from BOLI increased $34,000, or 3.6%. During the six months ended June 30, 2025, the Company reported a gain of $243,000 on non-marketable equity investments, compared to a gain of $987,000 during the six months ended June 30, 2024. During the six months ended June 30, 2025, the Company reported $95,000 in other income from loan-level swap fees on commercial loans and did not have comparable income during the six months ended June 30, 2024. During the six months ended June 30, 2025, the Company reported unrealized gains on marketable equity securities of $20,000, compared to unrealized gains on marketable equity securities of $12,000 during the six months ended June 30, 2024. Gains and losses from the investment portfolio vary from quarter to quarter based on market conditions, as well as the related yield curve and valuation changes. During the six months ended June 30, 2025, the Company reported $11,000 in gains from mortgage banking activities and did not have comparable gains or losses during the six months ended June 30, 2024. In addition, during the six months ended June 30, 2024, the Company reported a loss on the disposal of premises and equipment of $6,000 and did not have a comparable gain or loss during the six months ended June 30, 2025.

    Non-Interest Expense

    For the six months ended June 30, 2025, non-interest expense increased $1.7 million, or 6.0%, to $30.8 million, compared to $29.1 million for the six months ended June 30, 2024. The increase in non-interest expense was primarily due to an increase in salaries and employee benefits of $1.1 million, or 6.8%, due to an increase in deferred compensation expense to reflect updated performance award estimates. Advertising expense increased $184,000, or 26.7%, data processing increased $107,000, or 6.3%, FDIC insurance expense increased $97,000, or 13.2%, occupancy expense increased $96,000, or 3.7%, debit card and ATM processing fees increased $56,000, or 4.7%, software related expenses increased $39,000, or 3.1%, professional fees increased $19,000, or 1.7%, furniture and equipment expense increased $11,000, or 1.1%, and other non-interest expense increased $36,000, or 1.4%.

    For the six months ended June 30, 2025, the efficiency ratio was 78.4%, compared to 80.1% for the six months ended June 30, 2024. For the six months ended June 30, 2025, the adjusted efficiency ratio, a non-GAAP financial measure, was 78.9%, compared to 82.4% for the six months ended June 30, 2024. The decreases in the efficiency ratio and the adjusted efficiency ratio were driven by higher revenues, defined as the sum of net interest income and non-interest income, during the six months ended June 30, 2025, compared to the six months ended June 30, 2024. The adjusted efficiency ratio is a non-GAAP measure. See pages 19-21 for the related efficiency ratio calculation and a reconciliation of GAAP to non-GAAP financial measures.

    Income Tax Provision

    Income tax expense for the six months ended June 30, 2025 was $2.1 million, representing an effective tax rate of 23.2%, compared to $1.6 million, representing an effective tax rate of 19.8%, for six months ended June 30, 2024. The increase is due to higher projected pre-tax income for the twelve months ended December 31, 2025.

    Balance Sheet

    At June 30, 2025, total assets were $2.7 billion, an increase of $58.1 million, or 2.2%, from December 31, 2024. The increase in total assets was primarily due to an increase in total gross loans of $22.1 million, or 1.1%, an increase in cash and cash equivalents of $26.9 million, or 40.4%, and an increase in investment securities of $10.8 million, or 2.9%.

    Investments

    At June 30, 2025, the investment securities portfolio totaled $376.9 million, or 13.9% of total assets, compared to $366.1 million, or 13.8% of total assets, at December 31, 2024. At June 30, 2025, the Company’s available-for-sale securities portfolio, recorded at fair market value, increased $18.1 million, or 11.3%, from $160.7 million at December 31, 2024 to $178.8 million. The held-to-maturity securities portfolio, recorded at amortized cost, decreased $7.4 million, or 3.6%, from $205.0 million at December 31, 2024 to $197.7 million at June 30, 2025.

    At June 30, 2025, the Company reported unrealized losses on the available-for-sale securities portfolio of $26.6 million, or 12.9% of the amortized cost basis of the available-for-sale securities portfolio, compared to unrealized losses of $31.2 million, or 16.2% of the amortized cost basis of the available-for-sale securities at December 31, 2024. At June 30, 2025, the Company reported unrealized losses on the held-to-maturity securities portfolio of $35.4 million, or 17.8% of the amortized cost basis of the held-to-maturity securities portfolio, compared to $39.4 million, or 19.2% of the amortized cost basis of the held-to-maturity securities portfolio at December 31, 2024.

    The securities in which the Company may invest are limited by regulation. Federally chartered savings banks have authority to invest in various types of assets, including U.S. Treasury obligations, securities of various government-sponsored enterprises, mortgage-backed securities, certain certificates of deposit of insured financial institutions, repurchase agreements, overnight and short-term loans to other banks, corporate debt instruments and marketable equity securities. The securities, with the exception of $8.7 million in corporate bonds, are issued by the United States government or government-sponsored enterprises and are therefore either explicitly or implicitly guaranteed as to the timely payment of contractual principal and interest. These positions are deemed to have no credit impairment, therefore, the disclosed unrealized losses with the securities portfolio relate primarily to changes in prevailing interest rates. In all cases, price improvement in future periods will be realized as the issuances approach maturity.

    Management regularly reviews the portfolio for securities in an unrealized loss position. At June 30, 2025 and December 31, 2024, the Company did not record any credit impairment charges on its securities portfolio and attributed the unrealized losses primarily due to fluctuations in general interest rates or changes in expected prepayments and not due to credit quality. The primary objective of the Company’s investment portfolio is to provide liquidity and to secure municipal deposit accounts while preserving the safety of principal. The available-for-sale and held-to-maturity portfolios are both eligible for pledging to the Federal Home Loan Bank (“FHLB”) and Federal Reserve Bank (“FRB”) as collateral for borrowings. The portfolios are comprised of high-credit quality investments and both portfolios generated cash flows monthly from interest, principal amortization and payoffs, which support’s the Bank’s objective to provide liquidity.

    Total Loans

    Total gross loans increased $22.1 million, or 1.1%, from $2.1 billion, or 77.9% of total assets, at December 31, 2024 to $2.1 billion, or 77.1% of total assets, at June 30, 2025. The increase in total gross loans was primarily driven by an increase in residential real estate loans, including home equity loans, of $29.7 million, or 3.8%, and an increase in commercial and industrial loans of $22.8 million, or 10.8%. The increase in commercial and industrial loans was partially due to an increase in line of credit utilization, from 21.9% at December 31, 2024 to 26.1% at June 30, 2025. These increases were partially offset by a decrease in commercial real estate loans of $29.5 million, or 2.7%, and a decrease in consumer loans of $879,000, or 20.0%.

    The following table presents a summary of the loan portfolio by the major classification of loans at the periods indicated:

      June 30, 2025   December 31, 2024
      (Dollars in thousands)
       
    Commercial real estate loans:      
    Non-owner occupied $ 859,162   $ 880,828
    Owner occupied   187,043     194,904
    Total commercial real estate loans   1,046,205     1,075,732
           
    Residential real estate loans:      
    Residential   677,356     653,802
    Home equity   128,003     121,857
    Total residential real estate loans   805,359     775,659
           
    Commercial and industrial loans   234,505     211,656
           
    Consumer loans   3,512     4,391
    Total gross loans   2,089,581     2,067,438
    Unamortized premiums and net deferred loans fees and costs   3,050     2,751
    Total loans $ 2,092,631   $ 2,070,189


    Credit Quality

    Management continues to closely monitor the loan portfolio for any signs of deterioration in borrowers’ financial condition and also in light of speculation that commercial real estate values may deteriorate as the market continues to adjust to higher vacancies and interest rates. We continue to proactively take steps to mitigate risk in our loan portfolio.

    Total delinquency was $3.9 million, or 0.18% of total loans, at June 30, 2025, compared to $5.0 million, or 0.24% of total loans at December 31, 2024. At June 30, 2025, nonaccrual loans totaled $5.8 million, or 0.27% of total loans, compared to $5.4 million, or 0.26% of total loans, at December 31, 2024. At June 30, 2025 and December 31, 2024, there were no loans 90 or more days past due and still accruing interest. Total nonaccrual assets totaled $5.8 million, or 0.21% of total assets, at June 30, 2025, compared to $5.4 million, or 0.20% of total assets, at December 31, 2024. At June 30, 2025 and December 31, 2024, the Company did not have any other real estate owned.

    At June 30, 2025, the allowance for credit losses was $19.7 million, or 0.94% of total loans and 343.1% of nonaccrual loans, compared to $19.5 million, or 0.94% of total loans and 362.9% of nonaccrual loans, at December 31, 2024. Total criticized loans, defined as special mention and substandard loans, decreased $12.3 million, or 32.0%, from $38.4 million, or 1.9% of total loans, at December 31, 2024 to $26.1 million, or 1.2% of total gross loans, at June 30, 2025.

    Our commercial real estate portfolio is comprised of diversified property types and primarily within our geographic footprint. At June 30, 2025, the commercial real estate portfolio totaled $1.0 billion, and represented 50.1% of total gross loans. Of the $1.0 billion, $859.2 million, or 82.1%, was categorized as non-owner occupied commercial real estate and represented 316.9% of the Bank’s total risk-based capital. More details on the diversification of the loan portfolio are available in the supplementary earnings presentation.

    Deposits

    At June 30, 2025, total deposits were $2.3 billion and increased $67.5 million, or 3.0%, from December 31, 2024. Core deposits, which the Company defines as all deposits except time deposits, increased $81.4 million, or 5.2%, from $1.6 billion, or 68.9% of total deposits, at December 31, 2024, to $1.6 billion, or 70.4% of total deposits, at June 30, 2025. Non-interest-bearing deposits increased $29.6 million, or 5.2%, to $595.3 million, and represent 25.5% of total deposits, money market accounts increased $25.3 million, or 3.8%, to $686.8 million, interest-bearing checking accounts increased $18.3 million, or 12.2%, to $168.7 million, and savings accounts increased $8.1 million, or 4.5%, to $189.7 million.

    Time deposits decreased $13.9 million, or 2.0%, from $703.6 million at December 31, 2024 to $689.7 million at June 30, 2025. Brokered time deposits, which are included in time deposits, totaled $1.7 million at December 31, 2024. The Company did not have brokered time deposits at June 30, 2025. We continue our disciplined and focused approach to core relationship management and customer outreach to meet funding requirements and liquidity needs, with an emphasis on retaining a long-term core customer relationship base by competing for and retaining deposits in our local market. At June 30, 2025, the Bank’s uninsured deposits totaled $688.4 million, or 29.5% of total deposits, compared to $643.6 million, or 28.4% of total deposits, at December 31, 2024.

    The table below is a summary of our deposit balances for the periods noted:

                 
        June 30, 2025   December 31, 2024   June 30, 2024
        (Dollars in thousands)
    Core Deposits:            
    Demand accounts   $ 595,263   $ 565,620   $ 553,329
    Interest-bearing accounts     168,679     150,348     149,100
    Savings accounts     189,716     181,618     186,171
    Money market accounts     686,774     661,478     611,501
    Total Core Deposits   $ 1,640,432   $ 1,559,064   $ 1,500,101
    Time Deposits:     689,681     703,583     671,708
    Total Deposits:   $ 2,330,113   $ 2,262,647   $ 2,171,809


    FHLB and Subordinated Debt

    At June 30, 2025, total borrowings decreased $1.3 million, or 1.1%, from $123.1 million at December 31, 2024 to $121.8 million. At June 30, 2025, short-term borrowings decreased $1.4 million, or 25.1%, to $4.0 million, compared to $5.4 million at December 31, 2024. Long-term borrowings were $98.0 million at June 30, 2025 and December 31, 2024. At June 30, 2025 and December 31, 2024, borrowings also consisted of $19.8 million in fixed-to-floating rate subordinated notes.

    As of June 30, 2025, the Company had $452.7 million of additional borrowing capacity at the FHLB, $383.8 million of additional borrowing capacity under the FRB Discount Window and $25.0 million of other unsecured lines of credit with correspondent banks.

    Capital

    At June 30, 2025, shareholders’ equity was $239.4 million, or 8.8% of total assets, compared to $235.9 million, or 8.9% of total assets, at December 31, 2024. The change was primarily attributable to a decrease in accumulated other comprehensive loss of $3.5 million, cash dividends paid of $2.9 million, repurchase of shares at a cost of $4.7 million, partially offset by net income of $6.9 million. At June 30, 2025, total shares outstanding were 20,494,501. The Company’s regulatory capital ratios continue to be strong and in excess of regulatory minimum requirements to be considered well-capitalized as defined by regulators and internal Company targets.

      June 30, 2025   December 31, 2024
      Company   Bank   Company   Bank
    Total Capital (to Risk Weighted Assets) 14.42 %   13.69 %   14.38 %   13.65 %
    Tier 1 Capital (to Risk Weighted Assets) 12.40 %   12.67 %   12.37 %   12.64 %
    Common Equity Tier 1 Capital (to Risk Weighted Assets) 12.40 %   12.67 %   12.37 %   12.64 %
    Tier 1 Leverage Ratio (to Adjusted Average Assets) 9.10 %   9.29 %   9.14 %   9.34 %


    Dividends

    Although the Company has historically paid quarterly dividends on its common stock and currently intends to continue to pay such dividends, the Company’s ability to pay such dividends depends on a number of factors, including restrictions under federal laws and regulations on the Company’s ability to pay dividends, and as a result, there can be no assurance that dividends will continue to be paid in the future.

    About Western New England Bancorp, Inc.

    Western New England Bancorp, Inc. is a Massachusetts-chartered stock holding company and the parent company of Westfield Bank, CSB Colts, Inc., Elm Street Securities Corporation, WFD Securities, Inc. and WB Real Estate Holdings, LLC. Western New England Bancorp, Inc. and its subsidiaries are headquartered in Westfield, Massachusetts and operate 25 banking offices throughout western Massachusetts and northern Connecticut. To learn more, visit our website at www.westfieldbank.com.

    Forward-Looking Statements

    This press release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, with respect to the Company’s financial condition, liquidity, results of operations, future performance, and business. Forward-looking statements may be identified by the use of such words as “believe,” “expect,” “anticipate,” “should,” “planned,” “estimated,” and “potential.” Examples of forward-looking statements include, but are not limited to, estimates with respect to our financial condition, results of operations and business that are subject to various factors which could cause actual results to differ materially from these estimates. These factors include, but are not limited to:

    • unpredictable changes in general economic or political conditions, financial markets, fiscal, monetary and regulatory policies, including actual or potential stress in the banking industry;
    • unstable political and economic conditions, including changes in tariff policies, which could materially impact credit quality trends and the ability to generate loans and gather deposits;
    • inflation and governmental responses to inflation, including recent sustained increases and potential future increases in interest rates that reduce margins;
    • the effect on our operations of governmental legislation and regulation, including changes in accounting regulation or standards, the nature and timing of the adoption and effectiveness of new requirements under the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, Basel guidelines, capital requirements and other applicable laws and regulations;
    • significant changes in accounting, tax or regulatory practices or requirements;
    • new legal obligations or liabilities or unfavorable resolutions of litigation;
    • disruptive technologies in payment systems and other services traditionally provided by banks;
    • the highly competitive industry and market area in which we operate;
    • operational risks or risk management failures by us or critical third parties, including without limitation with respect to data processing, information systems, cybersecurity, technological changes, vendor issues, business interruption, and fraud risks;
    • failure or circumvention of our internal controls or procedures;
    • changes in the securities markets which affect investment management revenues;
    • increases in Federal Deposit Insurance Corporation deposit insurance premiums and assessments;
    • the soundness of other financial services institutions which may adversely affect our credit risk;
    • certain of our intangible assets may become impaired in the future;
    • the duration and scope of potential pandemics, including the emergence of new variants and the response thereto;
    • new lines of business or new products and services, which may subject us to additional risks;
    • changes in key management personnel which may adversely impact our operations;
    • severe weather, natural disasters, acts of war or terrorism and other external events which could significantly impact our business; and
    • other risk factors detailed from time to time in our SEC filings.

    Although we believe that the expectations reflected in such forward-looking statements are reasonable, actual results may differ materially from the results discussed in these forward-looking statements. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. We do not undertake any obligation to republish revised forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events, except to the extent required by law.

    WESTERN NEW ENGLAND BANCORP, INC. AND SUBSIDIARIES
    Consolidated Statements of Net Income and Other Data
    (Dollars in thousands, except per share data)
    (Unaudited)
      Three Months Ended Six Months Ended
      June 30, March 31, December 31, September 30, June 30, June 30,
        2025     2025     2024     2024     2024     2025     2024  
    INTEREST AND DIVIDEND INCOME:              
    Loans $ 26,214   $ 24,984   $ 25,183   $ 25,134   $ 24,340   $ 51,198   $ 48,581  
    Securities   2,588     2,422     2,273     2,121     2,141     5,010     4,255  
    Other investments   169     191     214     189     148     360     284  
    Short-term investments   641     840     916     396     173     1,481     286  
    Total interest and dividend income   29,612     28,437     28,586     27,840     26,802     58,049     53,406  
                   
    INTEREST EXPENSE:              
    Deposits   10,437     11,376     11,443     11,165     10,335     21,813     19,628  
    Short-term borrowings   47     54     60     71     186     101     469  
    Long-term debt   1,232     1,219     1,557     1,622     1,557     2,451     2,985  
    Subordinated debt   254     254     253     254     254     508     508  
    Total interest expense   11,970     12,903     13,313     13,112     12,332     24,873     23,590  
                   
    Net interest and dividend income   17,642     15,534     15,273     14,728     14,470     33,176     29,816  
                   
    (REVERSAL OF) PROVISION FOR CREDIT LOSSES   (615 )   142     (762 )   941     (294 )   (473 )   (844 )
                   
    Net interest and dividend income after (reversal of) provision for credit losses   18,257     15,392     16,035     13,787     14,764     33,649     30,660  
                   
    NON-INTEREST INCOME:              
    Service charges and fees on deposits   2,528     2,284     2,301     2,341     2,341     4,812     4,560  
    Income from bank-owned life insurance   516     473     486     470     502     989     955  
    Unrealized gain (loss) on marketable equity securities   25     (5 )   (9 )   10     4     20     12  
    Gain (loss) on sale of mortgages   4     7     (11 )   246     –     11     –  
    Gain on non-marketable equity investments   243     –     300     –     987     243     987  
    Loss on disposal of premises and equipment   –     –     –     –     –     –     (6 )
    Other income   95     –     187     74     –     95     –  
    Total non-interest income   3,411     2,759     3,254     3,141     3,834     6,170     6,508  
                   
    NON-INTEREST EXPENSE:              
    Salaries and employees benefits   8,831     8,413     8,429     8,112     7,901     17,244     16,145  
    Occupancy   1,265     1,412     1,256     1,217     1,218     2,677     2,581  
    Furniture and equipment   491     487     505     483     483     978     967  
    Data processing   933     882     900     869     846     1,815     1,708  
    Software   645     659     642     612     566     1,304     1,265  
    Debit/ATM card processing expense   674     577     593     649     643     1,251     1,195  
    Professional fees   623     546     471     540     581     1,169     1,150  
    FDIC insurance   399     431     389     338     323     830     733  
    Advertising   443     429     310     271     339     872     688  
    Other   1,352     1,348     1,431     1,315     1,414     2,700     2,664  
    Total non-interest expense   15,656     15,184     14,926     14,406     14,314     30,840     29,096  
                   
    INCOME BEFORE INCOME TAXES   6,012     2,967     4,363     2,522     4,284     8,979     8,072  
                   
    INCOME TAX PROVISION   1,422     664     1,075     618     771     2,086     1,598  
    NET INCOME $ 4,590   $ 2,303   $ 3,288   $ 1,904   $ 3,513   $ 6,893   $ 6,474  
                   
    Basic earnings per share $ 0.23   $ 0.11   $ 0.16   $ 0.09   $ 0.17   $ 0.34   $ 0.31  
    Weighted average shares outstanding   20,210,650     20,385,481     20,561,749     20,804,162     21,056,173     20,297,582     21,118,571  
    Diluted earnings per share $ 0.23   $ 0.11   $ 0.16   $ 0.09   $ 0.17   $ 0.34   $ 0.31  
    Weighted average diluted shares outstanding   20,312,881     20,514,098     20,701,276     20,933,833     21,163,762     20,413,006     21,217,543  
                   
    Other Data:              
    Return on average assets (1)   0.69 %   0.35 %   0.49 %   0.29 %   0.55 %   0.52 %   0.51 %
    Return on average equity (1)   7.76 %   3.94 %   5.48 %   3.19 %   6.03 %   5.87 %   5.53 %
    Efficiency ratio   74.36 %   83.00 %   80.56 %   80.62 %   78.20 %   78.38 %   80.10 %
    Adjusted efficiency ratio (2)   75.32 %   82.98 %   81.85 %   80.67 %   82.68 %   78.91 %   82.35 %
    Net interest margin   2.80 %   2.49 %   2.41 %   2.40 %   2.42 %   2.64 %   2.50 %
    Net interest margin, on a fully tax-equivalent basis   2.82 %   2.51 %   2.43 %   2.42 %   2.44 %   2.66 %   2.52 %
    (1) Annualized.          
    (2) The adjusted efficiency ratio (non-GAAP) represents the ratio of operating expenses divided by the sum of net interest and dividend income and non-interest income, excluding realized and unrealized gains and losses on securities, gain on non-marketable equity investments, and loss on disposal of premises and equipment.
    WESTERN NEW ENGLAND BANCORP, INC. AND SUBSIDIARIES
    Consolidated Balance Sheets
    (Dollars in thousands)
    (Unaudited)
      June 30,   March 31,   December 31,   September 30,   June 30,
        2025       2025       2024       2024       2024  
    Cash and cash equivalents $ 93,308     $ 110,579     $ 66,450     $ 72,802     $ 53,458  
    Securities available-for-sale, at fair value   178,785       167,800       160,704       155,889       135,089  
    Securities held to maturity, at amortized cost   197,671       201,557       205,036       213,266       217,632  
    Marketable equity securities, at fair value   444       414       397       252       233  
    Federal Home Loan Bank of Boston and other restricted stock – at cost   5,818       5,818       5,818       7,143       7,143  
                       
    Loans   2,092,631       2,079,561       2,070,189       2,049,002       2,026,226  
    Allowance for credit losses   (19,733 )     (19,669 )     (19,529 )     (19,955 )     (19,444 )
    Net loans   2,072,898       2,059,892       2,050,660       2,029,047       2,006,782  
                       
    Bank-owned life insurance   78,045       77,529       77,056       76,570       76,100  
    Goodwill   12,487       12,487       12,487       12,487       12,487  
    Core deposit intangible   1,250       1,344       1,438       1,531       1,625  
    Other assets   70,443       71,864       73,044       71,492       75,521  
    TOTAL ASSETS $ 2,711,149     $ 2,709,284     $ 2,653,090     $ 2,640,479     $ 2,586,070  
                       
    Total deposits $ 2,330,113     $ 2,328,593     $ 2,262,647     $ 2,224,206     $ 2,171,809  
    Short-term borrowings   4,040       4,520       5,390       4,390       6,570  
    Long-term debt   98,000       98,000       98,000       128,277       128,277  
    Subordinated debt   19,771       19,761       19,751       19,741       19,731  
    Securities pending settlement   –       2,093       8,622       2,513       102  
    Other liabilities   19,797       18,641       22,770       20,697       23,104  
    TOTAL LIABILITIES   2,471,721       2,471,608       2,417,180       2,399,824       2,349,593  
                       
    TOTAL SHAREHOLDERS’ EQUITY   239,428       237,676       235,910       240,655       236,477  
    TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY $ 2,711,149     $ 2,709,284     $ 2,653,090     $ 2,640,479     $ 2,586,070  
                       
    WESTERN NEW ENGLAND BANCORP, INC. AND SUBSIDIARIES
    Other Data
    (Dollars in thousands, except per share data)
    (Unaudited)
      Three Months Ended
      June 30,   March 31,   December 31,   September 30,   June 30,
      2025   2025   2024   2024   2024
    Shares outstanding at end of period 20,494,501   20,774,319   20,875,713   21,113,408   21,357,849
                       
    Operating results:                  
    Net interest income $ 17,642   $ 15,534   $ 15,273   $ 14,728   $ 14,470
    (Reversal of) provision for credit losses (615)   142   (762)   941   (294)
    Non-interest income 3,411   2,759   3,254   3,141   3,834
    Non-interest expense 15,656   15,184   14,926   14,406   14,314
    Income before income provision for income taxes 6,012   2,967   4,363   2,522   4,284
    Income tax provision 1,422   664   1,075   618   771
    Net income 4,590   2,303   3,288   1,904   3,513
                       
    Performance Ratios:                  
    Net interest margin 2.80%   2.49%   2.41%   2.40%   2.42%
    Net interest margin, on a fully tax-equivalent basis 2.82%   2.51%   2.43%   2.42%   2.44%
    Interest rate spread 2.10%   1.74%   1.63%   1.60%   1.66%
    Interest rate spread, on a fully tax-equivalent basis 2.12%   1.76%   1.65%   1.62%   1.67%
    Return on average assets 0.69%   0.35%   0.49%   0.29%   0.55%
    Return on average equity 7.76%   3.94%   5.48%   3.19%   6.03%
    Efficiency ratio (GAAP) 74.36%   83.00%   80.56%   80.62%   78.20%
    Adjusted efficiency ratio (non-GAAP) (1) 75.32%   82.98%   81.85%   80.67%   82.68%
                       
    Per Common Share Data:                  
    Basic earnings per share $ 0.23   $ 0.11   $ 0.16   $ 0.09   $ 0.17
    Earnings per diluted share 0.23   0.11   0.16   0.09   0.17
    Cash dividend declared 0.07   0.07   0.07   0.07   0.07
    Book value per share 11.68   11.44   11.30   11.40   11.07
    Tangible book value per share (non-GAAP) (2) 11.01   10.78   10.63   10.73   10.41
                       
    Asset Quality:                  
    30-89 day delinquent loans $ 2,525   $ 2,459   $ 3,694   $ 3,059   $ 3,270
    90 days or more delinquent loans 1,328   2,027   1,301   1,253   2,280
    Total delinquent loans 3,853   4,486   4,995   4,312   5,550
    Total delinquent loans as a percentage of total loans 0.18%   0.22%   0.24%   0.21%   0.27%
    Nonaccrual loans $ 5,752   $ 6,014   $ 5,381   $ 4,873   $ 5,845
    Nonaccrual loans as a percentage of total loans 0.27%   0.29%   0.26%   0.24%   0.29%
    Nonaccrual assets as a percentage of total assets 0.21%   0.22%   0.20%   0.18%   0.23%
    Allowance for credit losses as a percentage of nonaccrual loans 343.06%   327.05%   362.93%   409.50%   332.66%
    Allowance for credit losses as a percentage of total loans 0.94%   0.95%   0.94%   0.97%   0.96%
    Net loan (recoveries) charge-offs $ (585)   $ 29   $ (128)   $ 98   $ 10
    Net loan (recoveries) charge-offs as a percentage of average loans (0.03)%   0.00%   (0.01)%   0.00%   0.00%
    (1) The adjusted efficiency ratio (non-GAAP) represents the ratio of operating expenses divided by the sum of net interest and dividend income and non-interest income, excluding realized and unrealized gains and losses on securities, gains on non-marketable equity investments, and loss on disposal of premises and equipment.
    (2) Tangible book value per share (non-GAAP) represents the value of the Company’s tangible assets divided by its current outstanding shares.

    The following table sets forth the information relating to our average balances and net interest income for the three months ended June 30, 2025, March 31, 2025 and June 30, 2024 and reflects the average yield on interest-earning assets and average cost of interest-bearing liabilities for the periods indicated.

      Three Months Ended
      June 30, 2025   March 31, 2025   June 30, 2024
      Average       Average Yield/   Average       Average Yield/   Average       Average Yield/
      Balance   Interest   Cost(8)   Balance   Interest   Cost(8)   Balance   Interest   Cost(8)
      (Dollars in thousands)
    ASSETS:                                        
    Interest-earning assets                                        
    Loans(1)(2) $ 2,081,319   $ 26,335     5.08 %   $ 2,073,486   $ 25,105     4.91 %   $ 2,017,127   $ 24,454     4.88 %
    Securities(2)   375,074     2,588     2.77       365,371     2,422     2.69       354,850     2,141     2.43  
    Other investments   15,062     169     4.50       14,819     191     5.23       14,328     148     4.15  
    Short-term investments(3)   58,622     641     4.39       76,039     840     4.48       14,328     173     4.86  
    Total interest-earning assets   2,530,077     29,733     4.71       2,529,715     28,558     4.58       2,400,633     26,916     4.51  
    Total non-interest-earning assets   156,247               156,733               156,701          
    Total assets $ 2,686,324             $ 2,686,448             $ 2,557,334          
                                             
    LIABILITIES AND EQUITY:                                        
    Interest-bearing liabilities                                        
    Interest-bearing checking accounts $ 165,329     424     1.03     $ 140,960     250     0.72     $ 131,449     253     0.77  
    Savings accounts   188,498     55     0.12       183,869     40     0.09       185,690     51     0.11  
    Money market accounts   687,621     3,600     2.10       704,215     3,968     2.29       622,062     2,930     1.89  
    Time deposit accounts   690,555     6,358     3.69       702,748     7,118     4.11       650,054     7,101     4.39  
    Total interest-bearing deposits   1,732,003     10,437     2.42       1,731,792     11,376     2.66       1,589,255     10,335     2.62  
    Borrowings   122,070     1,533     5.04       122,786     1,527     5.04       160,484     1,997     5.00  
    Interest-bearing liabilities   1,854,073     11,970     2.59       1,854,578     12,903     2.82       1,749,739     12,332     2.83  
    Non-interest-bearing deposits   572,833               569,638               548,781          
    Other non-interest-bearing liabilities   22,207               25,464               24,453          
    Total non-interest-bearing liabilities   595,040               595,102               573,234          
    Total liabilities   2,449,113               2,449,680               2,322,973          
    Total equity   237,211               236,768               234,361          
    Total liabilities and equity $ 2,686,324             $ 2,686,448             $ 2,557,334          
    Less: Tax-equivalent adjustment(2)       (121 )               (121 )               (114 )      
    Net interest and dividend income     $ 17,642               $ 15,534               $ 14,470        
    Net interest rate spread(4)         2.10 %           1.74 %           1.66 %
    Net interest rate spread, on a tax-equivalent basis(5)         2.12 %           1.76 %           1.67 %
    Net interest margin(6)         2.80 %           2.49 %           2.42 %
    Net interest margin, on a tax-equivalent basis(7)         2.82 %           2.51 %           2.44 %
    Ratio of average interest-earning assets to average interest-bearing liabilities         136.46 %           136.40 %           137.20 %

    The following tables set forth the information relating to our average balances and net interest income for the six months ended June 30, 2025 and 2024 and reflect the average yield on interest-earning assets and average cost of interest-bearing liabilities for the periods indicated.

      Six Months Ended June 30,
        2025     2024
      Average
    Balance    		   Interest   Average Yield/
    Cost(8)    		   Average
    Balance    		   Interest   Average Yield/
    Cost(8)
     
      (Dollars in thousands)
    ASSETS:                          
    Interest-earning assets                          
    Loans(1)(2) $ 2,077,424   $ 51,440     4.99 %   $ 2,019,420   $ 48,805     4.86 %
    Securities(2)   370,249     5,010     2.73       357,171     4,255     2.40  
    Other investments   14,941     360     4.86       13,411     284     4.26  
    Short-term investments(3)   67,282     1,481     4.44       11,857     286     4.85  
    Total interest-earning assets   2,529,896     58,291     4.65       2,401,859     53,630     4.49  
    Total non-interest-earning assets   156,489               155,555          
    Total assets $ 2,686,385             $ 2,557,414          
                               
    LIABILITIES AND EQUITY:                          
    Interest-bearing liabilities                          
    Interest-bearing checking accounts $ 153,212     674     0.89 %   $ 133,504     488     0.74 %
    Savings accounts   186,196     95     0.10       185,907     90     0.10  
    Money market accounts   695,872     7,569     2.19       624,164     5,517     1.78  
    Time deposit accounts   696,618     13,475     3.90       638,970     13,533     4.26  
    Total interest-bearing deposits   1,731,898     21,813     2.54       1,582,545     19,628     2.49  
    Short-term borrowings and long-term debt   122,426     3,060     5.04       160,643     3,962     4.96  
    Total interest-bearing liabilities   1,854,324     24,873     2.70       1,743,188     23,590     2.72  
    Non-interest-bearing deposits   571,245               553,246          
    Other non-interest-bearing liabilities   23,826               25,672          
    Total non-interest-bearing liabilities   595,071               578,918          
                               
    Total liabilities   2,449,395               2,322,106          
    Total equity   236,990               235,308          
    Total liabilities and equity $ 2,686,385             $ 2,557,414          
    Less: Tax-equivalent adjustment (2)       (242 )               (224 )      
    Net interest and dividend income     $ 33,176               $ 29,816        
    Net interest rate spread (4)         1.92 %           1.75 %
    Net interest rate spread, on a tax-equivalent basis (5)         1.95 %           1.77 %
    Net interest margin (6)         2.64 %           2.50 %
    Net interest margin, on a tax-equivalent basis (7)         2.66 %           2.52 %
    Ratio of average interest-earning assets to average interest-bearing liabilities       136.43 %           137.79 %
       
    (1) Loans, including nonaccrual loans, are net of deferred loan origination costs and unadvanced funds.  
    (2) Loan and securities income are presented on a tax-equivalent basis using a tax rate of 21%. The tax-equivalent adjustment is deducted from tax-equivalent net interest and dividend income to agree to the amount reported on the consolidated statements of net income.   
    (3) Short-term investments include federal funds sold.   
    (4) Net interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average cost of interest-bearing liabilities.   
    (5) Net interest rate spread, on a tax-equivalent basis, represents the difference between the tax-equivalent weighted average yield on interest-earning assets and the weighted average cost of interest-bearing liabilities.   
    (6) Net interest margin represents net interest and dividend income as a percentage of average interest-earning assets.   
    (7) Net interest margin, on a tax-equivalent basis, represents tax-equivalent net interest and dividend income as a percentage of average interest-earning assets.   
    (8) Annualized.  


    Reconciliation of Non-GAAP to GAAP Financial Measures

    The Company believes that certain non-GAAP financial measures provide information to investors that is useful in understanding its results of operations and financial condition. Because not all companies use the same calculation, this presentation may not be comparable to other similarly titled measures calculated by other companies. A reconciliation of these non-GAAP financial measures is provided below.

      For the quarter ended
      6/30/2025   3/31/2025   12/31/2024   9/30/2024   6/30/2024
      (Dollars in thousands, except per share data)
                       
    Loan interest (no tax adjustment) $ 26,214     $ 24,984     $ 25,183     $ 25,134     $ 24,340  
    Tax-equivalent adjustment   121       121       128       119       114  
    Loan interest (tax-equivalent basis) $ 26,335     $ 25,105     $ 25,311     $ 25,253     $ 24,454  
                       
    Net interest income (no tax adjustment) $ 17,642     $ 15,534     $ 15,273     $ 14,728     $ 14,470  
    Tax equivalent adjustment   121       121       128       119       114  
    Net interest income (tax-equivalent basis) $ 17,763     $ 15,655     $ 15,401     $ 14,847     $ 14,584  
                       
    Net interest income (no tax adjustment) $ 17,642     $ 15,534     $ 15,273     $ 14,728     $ 14,470  
    Less:                  
    Prepayment penalties and fees   425       –       –       –       8  
    Adjusted net interest income (non-GAAP) $ 17,217     $ 15,534     $ 15,273     $ 14,728     $ 14,462  
                       
    Average interest-earning assets $ 2,530,077     $ 2,529,715     $ 2,517,017     $ 2,441,236     $ 2,400,633  
    Net interest margin (no tax adjustment)   2.80 %     2.49 %     2.41 %     2.40 %     2.42 %
    Net interest margin, tax-equivalent   2.82 %     2.51 %     2.43 %     2.42 %     2.44 %
    Net interest margin, excluding prepayment penalties and fees (non-GAAP)   2.73 %     2.49 %     2.41 %     2.40 %     2.42 %
                       
    Book Value per Share (GAAP) $ 11.68     $ 11.44     $ 11.30     $ 11.40     $ 11.07  
    Non-GAAP adjustments:                  
    Goodwill   (0.61 )     (0.60 )     (0.60 )     (0.59 )     (0.58 )
    Core deposit intangible   (0.06 )     (0.06 )     (0.07 )     (0.08 )     (0.08 )
    Tangible Book Value per Share (non-GAAP) $ 11.01     $ 10.78     $ 10.63     $ 10.73     $ 10.41  
                       
      For the quarter ended
      6/30/2025   3/31/2025   12/31/2024   9/30/2024   6/30/2024
      (Dollars in thousands)
                       
    Efficiency Ratio:                  
    Non-interest Expense (GAAP) $ 15,656     $ 15,184     $ 14,926     $ 14,406     $ 14,314  
                       
    Net Interest Income (GAAP) $ 17,642     $ 15,534     $ 15,273     $ 14,728     $ 14,470  
                       
    Non-interest Income (GAAP) $ 3,411     $ 2,759     $ 3,254     $ 3,141     $ 3,834  
    Non-GAAP adjustments:                  
    Unrealized (gains) losses on marketable equity securities   (25 )     5       9       (10 )     (4 )
    Gain on non-marketable equity investments   (243 )     –       (300 )     –       (987 )
    Non-interest Income for Adjusted Efficiency Ratio (non-GAAP) $ 3,143     $ 2,764     $ 2,963     $ 3,131     $ 2,843  
    Total Revenue for Adjusted Efficiency Ratio (non-GAAP) $ 20,785     $ 18,298     $ 18,236     $ 17,859     $ 17,313  
                       
    Efficiency Ratio (GAAP)   74.36 %     83.00 %     80.56 %     80.62 %     78.20 %
                       
    Adjusted Efficiency Ratio (Non-interest Expense (GAAP)/Total Revenue for Adjusted Efficiency Ratio (non-GAAP))   75.32 %     82.98 %     81.85 %     80.67 %     82.68 %
                       
      For the six months ended
      6/30/2025   6/30/2024
      (Dollars in thousands)
           
    Loan income (no tax adjustment) $ 51,198   $ 48,581
    Tax-equivalent adjustment 242   224
    Loan income (tax-equivalent basis) $ 51,440   $ 48,805
           
    Net interest income (no tax adjustment) $ 33,176   $ 29,816
    Tax equivalent adjustment 242   224
    Net interest income (tax-equivalent basis) $ 33,418   $ 30,040
           
    Net interest income (no tax adjustment) $ 33,176   $ 29,816
    Less:      
    Prepayment penalties and fees 425   8
    Adjusted net interest income (non-GAAP) $ 32,751   $ 29,808
           
    Average interest-earning assets $ 2,529,896   $ 2,401,859
    Net interest margin (no tax adjustment) 2.64%   2.50%
    Net interest margin, tax-equivalent 2.66%   2.52%
    Net interest margin, excluding prepayment penalties and fees (non-GAAP) 2.61%   2.50%
           
    Adjusted Efficiency Ratio:      
    Non-interest Expense (GAAP) $ 30,840   $ 29,096
           
    Net Interest Income (GAAP) $ 33,176   $ 29,816
           
    Non-interest Income (GAAP) $ 6,170   $ 6,508
    Non-GAAP adjustments:      
    Unrealized gains on marketable equity securities (20)   (12)
    Loss on disposal of premises and equipment, net –   6
    Gain on non-marketable equity investments (243)   (987)
    Non-interest Income for Adjusted Efficiency Ratio (non-GAAP) $ 5,907   $ 5,515
    Total Revenue for Adjusted Efficiency Ratio (non-GAAP) $ 39,083   $ 35,331
           
    Efficiency Ratio (GAAP) 78.38%   80.10%
           
    Adjusted Efficiency Ratio (Non-interest Expense (GAAP)/Total Revenue for Adjusted Efficiency Ratio (non-GAAP)) 78.91%   82.35%


    For further information contact:
    James C. Hagan, President and CEO
    Guida R. Sajdak, Executive Vice President and CFO
    Meghan Hibner, First Vice President and Investor Relations Officer
    413-568-1911

    The MIL Network –

  • MIL-OSI USA: Indianapolis CPA Sentenced for Participation in Illegal Tax Shelter

    Source: US State of North Dakota

    Defendant Helped Clients in Mississippi and Elsewhere File Returns Claiming False Business Deductions

    An Indiana CPA was sentenced yesterday to three years in prison for assisting in the preparation of false tax returns on behalf of clients who participated in an illegal tax shelter.

    The following is according to court documents and statements made in court: between 2013 and 2022, Jason L. Crace prepared income tax returns for clients that claimed millions of dollars in false deductions for so-called “royalty payments.”  However, as Crace knew, these “royalty payments” were merely circular flows of money designed to give the appearance of genuine business expenses. Typically, a client would send money to bank accounts controlled by scheme promoters who then sent the money — minus a fee — back to a different bank account controlled by the client. In this way, tax shelter participants retained control of the money they transferred, while falsely deducting the transfers as business expenses on their tax returns. One of the scheme’s promoters, Stephen T. Mellinger III, previously pleaded guilty and was sentenced to eight years in prison for his role promoting the scheme.

    In total, Crace’s preparation of false tax returns claiming fraudulent “royalty” deductions caused a loss to the IRS of more than $2.5 million.

    In addition to his prison sentence, the court sentenced Crace to serve one year of supervised release and to pay restitution of $2,532,936.

    Acting Deputy Assistant Attorney General Karen E. Kelly of the Justice Department’s Tax Division and Acting U.S. Attorney Patrick Lemon for the Southern District of Mississippi made the announcement.

    IRS Criminal Investigation is investigating the case.

    Trial Attorneys Richard J. Hagerman, William M. Montague, and Matthew C. Hicks of the Justice Department’s Tax Division and Assistant U.S. Attorney Charles W. Kirkham for the Southern District of Mississippi are prosecuting the case.

    MIL OSI USA News –

  • MIL-OSI Security: Indianapolis CPA Sentenced for Participation in Illegal Tax Shelter

    Source: United States Attorneys General 1

    Defendant Helped Clients in Mississippi and Elsewhere File Returns Claiming False Business Deductions

    An Indiana CPA was sentenced yesterday to three years in prison for assisting in the preparation of false tax returns on behalf of clients who participated in an illegal tax shelter.

    The following is according to court documents and statements made in court: between 2013 and 2022, Jason L. Crace prepared income tax returns for clients that claimed millions of dollars in false deductions for so-called “royalty payments.”  However, as Crace knew, these “royalty payments” were merely circular flows of money designed to give the appearance of genuine business expenses. Typically, a client would send money to bank accounts controlled by scheme promoters who then sent the money — minus a fee — back to a different bank account controlled by the client. In this way, tax shelter participants retained control of the money they transferred, while falsely deducting the transfers as business expenses on their tax returns. One of the scheme’s promoters, Stephen T. Mellinger III, previously pleaded guilty and was sentenced to eight years in prison for his role promoting the scheme.

    In total, Crace’s preparation of false tax returns claiming fraudulent “royalty” deductions caused a loss to the IRS of more than $2.5 million.

    In addition to his prison sentence, the court sentenced Crace to serve one year of supervised release and to pay restitution of $2,532,936.

    Acting Deputy Assistant Attorney General Karen E. Kelly of the Justice Department’s Tax Division and Acting U.S. Attorney Patrick Lemon for the Southern District of Mississippi made the announcement.

    IRS Criminal Investigation is investigating the case.

    Trial Attorneys Richard J. Hagerman, William M. Montague, and Matthew C. Hicks of the Justice Department’s Tax Division and Assistant U.S. Attorney Charles W. Kirkham for the Southern District of Mississippi are prosecuting the case.

    MIL Security OSI –

  • MIL-OSI USA: SBA Offers Disaster Relief to Indiana Small Businesses, Private Nonprofits and Residents Affected by Flooding

    Source: United States Small Business Administration

    ATLANTA–The U.S. Small Business Administration (SBA) announced the availability of low interest federal disaster loans for Indiana small businesses, private nonprofits, and residents affected by the flooding occurring June 28-July 2, 2025. The SBA issued a disaster declaration in response to a request received from Gov. Mike Braun on July 11, 2025.

    The disaster declaration covers the counties of Daviess, Dubois, Greene, Knox, Martin and Pike which are eligible for both Physical Damage Loans and Economic Injury Disaster Loans (EIDLs) from the SBA.  

    Small businesses and private nonprofits are eligible to apply for business physical disaster loans and may borrow up to $2 million to repair or replace disaster-damaged or destroyed real estate, machinery and equipment, inventory, and other business assets.  

    Homeowners and renters are eligible to apply for home and personal property loans and may borrow up to $100,000 to replace or repair personal property, such as clothing, furniture, cars, and appliances. Homeowners may apply for up to $500,000 to replace or repair their primary residence.  

    Applicants may also be eligible for a loan increase of up to 20% of their physical damage, as verified by the SBA, for mitigation purposes. Eligible mitigation improvements include strengthening structures to protect against high wind damage, upgrading to wind rated garage doors, and installing a safe room or storm shelter to help protect property and occupants from future damage.  

    “One distinct advantage of SBA’s disaster loan program is the opportunity to fund upgrades reducing the risk of future storm damage,” said Chris Stallings, associate administrator of the Office of Disaster Recovery and Resilience at the SBA. “I encourage businesses and homeowners to work with contractors and mitigation professionals to improve their storm readiness while taking advantage of SBA’s mitigation loans.”

    SBA’s EIDL program is available to small businesses, small agricultural cooperatives and private nonprofit (PNP) organizations with financial losses directly related to the disaster. The SBA is unable to provide disaster loans to agricultural producers, farmers, or ranchers, except for small aquaculture enterprises.

    EIDLs are for working capital needs caused by the disaster and are available even if the business did not suffer any physical damage. They may be used to pay fixed debts, payroll, accounts payable, and other bills not paid due to the disaster.

    Interest rates are as low as 4% for small businesses, 3.625% for PNPs, and 2.813% for homeowners and renters, with terms up to 30 years. Interest does not begin to accrue, and payments are not due, until 12 months from the date of the first loan disbursement. The SBA sets loan amounts and terms, based on each applicant’s financial condition.

    Beginning, Wednesday, July 23, SBA customer service representatives will be on hand at the Disaster Loan Outreach Center in the county of Daviess to answer questions about SBA’s disaster loan program, explain the application process and help individuals complete their application. Walk-ins are accepted, but you can schedule an in-person appointment in advance at appointment.sba.gov.

    The DLOC hours of operation are listed below:

    Disaster Loan Outreach Center (DLOC)

    Daviess County

    Odon Community Center

    311 Park Street

    Odon, Indiana 47562

    Opening: Wednesday, July 23, 10 a.m. to 5 p.m.

    Hours:  Monday – Friday, 8 a.m. to 5 p.m.

    Saturday, 10 a.m. to 2 p.m.

    Closed: Sunday

    Permanently Closing: July 31 at 4 p.m.

    Disaster survivors should not wait to settle with their insurance company before applying for a disaster loan. If a survivor does not know how much of their loss will be covered by insurance or other sources, SBA can make a low-interest disaster loan for the total loss up to its loan limits, provided the borrower agrees to use insurance proceeds to reduce or repay the loan.

    To apply online, visit sba.gov/disaster. Applicants may also call SBA’s Customer Service Center at (800) 659-2955 or email disastercustomerservice@sba.gov for more information on SBA disaster assistance. For people who are deaf, hard of hearing, or have a speech disability, please dial 7-1-1 to access telecommunications relay services.

    The filing deadline to return applications for physical property damage is Sept. 16, 2025. The deadline to return economic injury applications is April 20, 2026.

    ###

    About the U.S. Small Business Administration

    The U.S. Small Business Administration helps power the American dream of business ownership. As the only go-to resource and voice for small businesses backed by the strength of the federal government, the SBA empowers entrepreneurs and small business owners with the resources and support they need to start, grow or expand their businesses, or recover from a declared disaster. It delivers services through an extensive network of SBA field offices and partnerships with public and private organizations. To learn more, visit www.sba.gov. 

    MIL OSI USA News –

  • MIL-OSI USA: Governor Stein Announces 515 New Jobs in Western NC as Manufacturer Selects Graham County

    Source: US State of North Carolina

    Headline: Governor Stein Announces 515 New Jobs in Western NC as Manufacturer Selects Graham County

    Governor Stein Announces 515 New Jobs in Western NC as Manufacturer Selects Graham County
    lsaito

    Raleigh, NC

    Governor Josh Stein announced today that Eco King Solutions, LLC, a new subsidiary of a major manufacturer, plans to create 515 jobs in Graham County. The company will invest $80.5 million in Robbinsville to establish its first North American production facility to produce disposable, biodegradable paper tableware.

    “North Carolina offers global companies a perfect location for expansion into North America,” said Governor Josh Stein. “We welcome Eco King to western North Carolina, where it will find a welcoming business climate, education and workforce programs tailored to its needs, and the full range of competitive advantages that make North Carolina the top state to do business in the country.”

    Eco King Solutions is the wholly owned U.S. subsidiary of Chinese manufacturer Zhejiang Kingsun Eco-pack Co., Ltd, which was founded in 2008 and operates three high-capacity factories in China employing approximately 1,200 people. The company specializes in the production of disposable dishware such as bowls, plates, clamshell containers, and trays used in supermarkets and a wide variety of other food service industries. The company serves a growing customer base in North America, and the project represents a strategic expansion to better serve this market. Establishing the facility in Robbinsville will allow the company to localize production, improve supply chain efficiency, and reduce international shipping costs and production lead times. 

    “We have been impressed by how welcoming Robbinsville, Graham County and North Carolina have been to our company and this important project,” said Ping Zhang, Chairman of Eco King Solutions. “We worked very hard to find the right location for our business to thrive. We know we found it right here due to the excellent workforce, quality of life and friendly business climate. We are excited to be a part of the community, and we are excited for our company to prosper here.”

    “This investment is a success story for manufacturing in western North Carolina, where folks work hard to make great products,” said Commerce Secretary Lee Lilley. “Whether it’s CNBC naming us the top state for business or investments from CEOs around the world, North Carolina continues to be a global destination for great job creation.”

    Although wages will vary depending on the position, the average salary for the new jobs will be $46,707, in line with the average wage in Graham County of $46,628. The new jobs will generate an annual payroll impact in the community of more than $14 million.

    The company’s project in North Carolina will be facilitated, in part, by a Job Development Investment Grant (JDIG) approved by the state’s Economic Investment Committee earlier today. Over the course of the 12-year term of this grant, the project is estimated to grow the state’s economy by more than $743.4 million. Using a formula that takes into account the new tax revenues generated by 300 of the new jobs and the capital investment, the JDIG agreement authorizes the potential reimbursement to the company of up to $2,894,000, spread over 12 years. State payments occur only following performance verification by the departments of Commerce and Revenue that the company has met its incremental job creation and investment targets.

    The project’s projected return on investment of public dollars is 106 percent, meaning for every dollar of potential cost, the state receives $2.06 in state revenue. JDIG projects result in positive net tax revenue to the state treasury, even after taking into consideration the grant’s reimbursement payments to a given company. 

    “A major economic development win like today’s announcement provides proof that Robbinsville and Graham County are great places to do business,” said Senator Kevin Corbin. “We’re proud that Eco King chose us for their first North American factory, and we will do everything we can to help them be successful in western North Carolina.

    “I am very excited for Robbinsville,” said Representative Karl E. Gillespie. “The company will be establishing its first manufacturing facility in North America in Graham County. It’s another strong example of why North Carolina was recently named the #1 State in the nation to do business. This project is expected to bring new jobs, boost our local economy, and improve the quality of life in our community. Thank you to our local, regional, and state economic development leaders for helping make this project a reality.”

    Partnering with the North Carolina Department of Commerce and the Economic Development Partnership of North Carolina on this project were the North Carolina General Assembly, the North Carolina Community College System, the Commerce Department’s Divisions of Workforce Solutions and Rural Economic Development, Duke Energy, the Town of Robbinsville, Graham County, the Southwestern Commission, and the Mountain West Partnership. 

    Jul 22, 2025

    MIL OSI USA News –

  • MIL-OSI USA: Budd Joins Young, Colleagues to Urge End to Foreign Free-Riding Burdening American Patients & Calls for IP Negotiator Appointment

    US Senate News:

    Source: United States Senator Ted Budd (R-North Carolina)

    Washington, D.C. — U.S. Senator Ted Budd (R-N.C.) joined Senator Todd Young (R-Ind.), and several of his Senate Republicans colleagues, in sending a letter to U.S. Trade Representative Jamieson Greer and Secretary of Commerce Howard Lutnick urging the Trump Administration to use ongoing trade negotiations to eliminate foreign price controls that leave American patients footing the cost for pharmaceutical research and development.

    “We welcome President Trump’s efforts to ensure foreign nations pay their fair share toward the cost of pharmaceutical research and development. For too long, some developed nations have benefited from American-financed innovation by implementing policies that suppress prices and limit spending on new medicines in their own markets,” wrote the senators. “These actions have contributed to American patients bearing a disproportionate share of global pharmaceutical innovation costs. U.S. trade negotiations offer a valuable mechanism to address these unfair practices, which not only burden Americans, but also function as non-tariff barriers to trade.”

    The letter also urges the Administration to designate a senior political official within the Office of the U.S. Trade Representative to lead trade discussions on pharmaceutical pricing in the near term, and to promptly nominate a qualified individual to fill the long-vacant Chief Innovation and Intellectual Property Negotiator role, who would ultimately assume leadership of this effort. Created by Congress in 2015, the position was intended to “address acts, policies, and practices of foreign governments that have a significant adverse impact on the value of United States innovation.”

    “Appointing an experienced Chief Innovation and Intellectual Property Negotiator would send a strong signal to our trading partners that the United States is committed to addressing imbalanced pharmaceutical pricing and ensuring that any commitments secured are effectively implemented and enforced over the long term,” the senators wrote.

    U.S. Senators Thom Tillis (R-N.C.), Tim Scott (R-S.C.), Roger Marshall (R-Kan.), Bill Cassidy (R-La.), Steve Daines (R-Mont.), Cynthia Lummis (R-Wyo.), Ashley Moody (R-Fla.), Chuck Grassley (R-Iowa), Tommy Tuberville (R-Ala.), Roger Wicker (R-Miss.), John Boozman (R-Ark.), Jim Banks (R-Ind.), Jon Husted (R-Ohio), Cindy Hyde-Smith (R-Miss.), Tim Sheehy (R-Mont.), and Lindsey Graham (R-S.C.) also joined in signing the letter.

    Read the full letter text HERE and below:

    Dear Secretary Lutnick and Ambassador Greer,

    We welcome President Trump’s efforts to ensure foreign nations pay their fair share toward the cost of pharmaceutical research and development. For too long, some developed nations have benefited from American-financed innovation by implementing policies that suppress prices and limit spending on new medicines in their own markets. These actions have contributed to American patients bearing a disproportionate share of global pharmaceutical innovation costs. U.S. trade negotiations offer a valuable mechanism to address these unfair practices, which not only burden Americans, but also function as non-tariff barriers to trade.

    Executive Order 14297, issued on May 12, directed the U.S. Department of Commerce (Commerce) and the U.S. Trade Representative (USTR) to pursue the removal of policies and practices abroad that have “the effect of forcing American patients to pay for a disproportionate amount of global pharmaceutical research and development, including by suppressing the price of pharmaceutical products below fair market value in foreign countries.” Consistent with this directive, it is important that Commerce and USTR engage with U.S. trading partners to negotiate binding commitments to remove these market-distorting price controls.

    Currently, dozens of countries—including those with longstanding pricing policies affecting U.S. pharmaceutical products—have expressed interest or are currently undergoing tariff negotiations. Now is the time for Commerce and USTR to clarify top priorities, capitalize on opportunities, and resolve unfair foreign government policies in support of American workers and patients.

    Given the complexity of the issues and their importance to the American public, we urge the Administration to immediately designate a senior political official at USTR to lead the effort to secure and enforce pharmaceutical pricing commitments through trade negotiations and also to promptly nominate a qualified individual to fill the vacant position of Chief Innovation and Intellectual Property Negotiator. Congress created this important position in 2015 to “address acts, policies, and practices of foreign governments that have a significant adverse impact on the value of United States innovation.” Once filled, we recommend this role—supported by a team within USTR—be charged with leading this effort.

    Appointing an experienced Chief Innovation and Intellectual Property Negotiator would send a strong signal to our trading partners that the United States is committed to addressing imbalanced pharmaceutical pricing and ensuring that any commitments secured are effectively implemented and enforced over the long term.

    We look forward to working with you as you confront these longstanding and unfair price controls that leave Americans disproportionately funding global health care innovation. Eliminating these egregious practices could increase investment in medical research and development by billions of dollars and lower overall health care costs for Americans. In addition, encouraging foreign governments to appropriately value medicines developed and produced in the United States would significantly bolster U.S. exports and jobs. We appreciate your continued attention to this issue and stand ready to support efforts that promote fair and sustainable trade outcomes.

    Sincerely,

    /X/

    MIL OSI USA News –

  • MIL-OSI USA: Budd Joins Young, Colleagues to Urge End to Foreign Free-Riding Burdening American Patients & Calls for IP Negotiator Appointment

    US Senate News:

    Source: United States Senator Ted Budd (R-North Carolina)

    Washington, D.C. — U.S. Senator Ted Budd (R-N.C.) joined Senator Todd Young (R-Ind.), and several of his Senate Republicans colleagues, in sending a letter to U.S. Trade Representative Jamieson Greer and Secretary of Commerce Howard Lutnick urging the Trump Administration to use ongoing trade negotiations to eliminate foreign price controls that leave American patients footing the cost for pharmaceutical research and development.

    “We welcome President Trump’s efforts to ensure foreign nations pay their fair share toward the cost of pharmaceutical research and development. For too long, some developed nations have benefited from American-financed innovation by implementing policies that suppress prices and limit spending on new medicines in their own markets,” wrote the senators. “These actions have contributed to American patients bearing a disproportionate share of global pharmaceutical innovation costs. U.S. trade negotiations offer a valuable mechanism to address these unfair practices, which not only burden Americans, but also function as non-tariff barriers to trade.”

    The letter also urges the Administration to designate a senior political official within the Office of the U.S. Trade Representative to lead trade discussions on pharmaceutical pricing in the near term, and to promptly nominate a qualified individual to fill the long-vacant Chief Innovation and Intellectual Property Negotiator role, who would ultimately assume leadership of this effort. Created by Congress in 2015, the position was intended to “address acts, policies, and practices of foreign governments that have a significant adverse impact on the value of United States innovation.”

    “Appointing an experienced Chief Innovation and Intellectual Property Negotiator would send a strong signal to our trading partners that the United States is committed to addressing imbalanced pharmaceutical pricing and ensuring that any commitments secured are effectively implemented and enforced over the long term,” the senators wrote.

    U.S. Senators Thom Tillis (R-N.C.), Tim Scott (R-S.C.), Roger Marshall (R-Kan.), Bill Cassidy (R-La.), Steve Daines (R-Mont.), Cynthia Lummis (R-Wyo.), Ashley Moody (R-Fla.), Chuck Grassley (R-Iowa), Tommy Tuberville (R-Ala.), Roger Wicker (R-Miss.), John Boozman (R-Ark.), Jim Banks (R-Ind.), Jon Husted (R-Ohio), Cindy Hyde-Smith (R-Miss.), Tim Sheehy (R-Mont.), and Lindsey Graham (R-S.C.) also joined in signing the letter.

    Read the full letter text HERE and below:

    Dear Secretary Lutnick and Ambassador Greer,

    We welcome President Trump’s efforts to ensure foreign nations pay their fair share toward the cost of pharmaceutical research and development. For too long, some developed nations have benefited from American-financed innovation by implementing policies that suppress prices and limit spending on new medicines in their own markets. These actions have contributed to American patients bearing a disproportionate share of global pharmaceutical innovation costs. U.S. trade negotiations offer a valuable mechanism to address these unfair practices, which not only burden Americans, but also function as non-tariff barriers to trade.

    Executive Order 14297, issued on May 12, directed the U.S. Department of Commerce (Commerce) and the U.S. Trade Representative (USTR) to pursue the removal of policies and practices abroad that have “the effect of forcing American patients to pay for a disproportionate amount of global pharmaceutical research and development, including by suppressing the price of pharmaceutical products below fair market value in foreign countries.” Consistent with this directive, it is important that Commerce and USTR engage with U.S. trading partners to negotiate binding commitments to remove these market-distorting price controls.

    Currently, dozens of countries—including those with longstanding pricing policies affecting U.S. pharmaceutical products—have expressed interest or are currently undergoing tariff negotiations. Now is the time for Commerce and USTR to clarify top priorities, capitalize on opportunities, and resolve unfair foreign government policies in support of American workers and patients.

    Given the complexity of the issues and their importance to the American public, we urge the Administration to immediately designate a senior political official at USTR to lead the effort to secure and enforce pharmaceutical pricing commitments through trade negotiations and also to promptly nominate a qualified individual to fill the vacant position of Chief Innovation and Intellectual Property Negotiator. Congress created this important position in 2015 to “address acts, policies, and practices of foreign governments that have a significant adverse impact on the value of United States innovation.” Once filled, we recommend this role—supported by a team within USTR—be charged with leading this effort.

    Appointing an experienced Chief Innovation and Intellectual Property Negotiator would send a strong signal to our trading partners that the United States is committed to addressing imbalanced pharmaceutical pricing and ensuring that any commitments secured are effectively implemented and enforced over the long term.

    We look forward to working with you as you confront these longstanding and unfair price controls that leave Americans disproportionately funding global health care innovation. Eliminating these egregious practices could increase investment in medical research and development by billions of dollars and lower overall health care costs for Americans. In addition, encouraging foreign governments to appropriately value medicines developed and produced in the United States would significantly bolster U.S. exports and jobs. We appreciate your continued attention to this issue and stand ready to support efforts that promote fair and sustainable trade outcomes.

    Sincerely,

    /X/

    MIL OSI USA News –

  • MIL-OSI USA: Rep. Huffman Introduces Bill to Protect Small Farmers and Producers

    Source: United States House of Representatives – Congressman Jared Huffman Representing the 2nd District of California

    July 22, 2025

    Washington, D.C. – Today, Representative Jared Huffman (CA-02) re-introduced legislation that would enshrine the right for small cannabis producers to ship and sell their products directly to consumers. This bill, the Small and Homestead Independent Producers (SHIP) Act, would enable small farmers and producers to operate their businesses within and across state lines. The legislation is specifically targeted to support the smallest family farmers and help them sustain their businesses under a larger federal legalization law.

    “Larger, commercialized cannabis operators are infiltrating the market and squeezing out our local farmers in the process,” said Rep. Jared Huffman. “So when the antiquated federal prohibition on cannabis finally gets repealed, we need to have substantial legislation ready to help these small businesses survive. My legislation would ensure that folks can ship their products straight to consumers, which would both help expand small businesses and ensure farmers stay afloat. When full legalization is guaranteed, we must commit to not leaving our smallest family-farmers behind.”

    “Nearly 15 years into the experiment of state-level cannabis legalization, the cracks in the system are clear: small and craft producers are being pushed to the margins, safe access for consumers and patients is shrinking, and the industry is consolidating into the hands of a few,” said Ross Gordon, Co-Founder at National Craft Cannabis Coalition and Policy Analyst at Origins Council. “Without direct-to-consumer shipping, federal cannabis legalization risks reinforcing these failures instead of correcting them. The SHIP Act is a make-or-break policy for the future of small cannabis businesses in California and across the country.”

     “Our state’s DTC framework helps support nearly 1,700 cultivators in a state of 1.2 million people,” said Mark Barnett, Co-Founder at National Craft Cannabis Coalition and Policy Director at Maine Craft Cannabis Association. “Without these opportunities, quality in the legal market will suffer, and consumers will look elsewhere. The SHIP Act would guarantee that small farmers have a pathway to participate in one of the country’s most promising new economic frontiers.”

    “The regulation of cannabis has, unfortunately, not equated to adequate access,” said Frederika McClary Easley, President of the Minority Cannabis Business Association (MCBA). “Many patients and consumers navigate plant deserts that have been created due to municipal opt-outs and zoning restrictions. The SHIP Act will help to address this while prioritizing access for small craft producers, which in turn positively impacts their success and sustainability. MCBA is proud to support this piece of federal legislation that recognizes the importance of craft growing and small businesses as the bedrock of this burgeoning industry.”

    This bill is co-sponsored by Representative Val Hoyle.

    It is endorsed by National Craft Cannabis Coalition, Minority Cannabis Business Association, National Cannabis Industry Association, Drug Policy Alliance, Parabola Center, Marijuana Justice, Veterans Cannabis Coalition, Origins Council, Washington Sun & Craft Growers Association, Vermont Growers Association, Maine Craft Cannabis Association, Humboldt County Growers Alliance, Mendocino Cannabis Alliance, Trinity County Agricultural Alliance, and the Central California Cannabis Club.

    Full text of this legislation can be found here.

    ###

    Previous Article

    MIL OSI USA News –

  • MIL-OSI USA: MIFFLIN COUNTY – Governor Shapiro to Visit Lewistown Small Businesses, Highlight Proposed Budget Investments in PA Main Streets

    Source: US State of Pennsylvania

    July 23, 2025 – Lewistown, PA

    ADVISORY – MIFFLIN COUNTY – Governor Shapiro to Visit Lewistown Small Businesses, Highlight Proposed Budget Investments in PA Main Streets

    Governor Josh Shapiro will join DCED Secretary Rick Siger, local community leaders, and business owners to visit small businesses in Lewistown. This visit follows the Governor’s Main Street Matters stops in Chinatown and Lancaster this year, highlighting the real economic opportunities his 2025-26 budget will create for Pennsylvanians across the Commonwealth.

    Main Street Matters has built upon and modernized the Keystone Communities program and serves as a critical element of the Governor’s Economic Development Strategy. The Governor proposed an additional $20 million for the Main Street Matters program in his budget after its success in 2024, supporting small businesses and commercial corridors as the backbone of communities across the Commonwealth.

    WHO:
    Governor Josh Shapiro
    Secretary of Community and Economic Development Rick Siger
    Commissioner Kevin Kodish, Mifflin County Commissioners
    Julie Fitzpatrick, Executive Director, PA Downtown Center
    Ryan Cherry, Owner, East End Coffee Co.

    WHEN:
    Wednesday, July 23, 2025 at 11:00 AM

    WHERE:
    East End Coffee Co.
    18 E Market St
    Lewistown, PA 17044

    LIVE STREAM:
    pacast.com/live/gov
    governor.pa.gov/live/

    RSVP:
    Press who are interested in attending must RSVP with the names and phone numbers for each member of their team to ra-gvgovpress@pa.gov.

    MIL OSI USA News –