8-K
FIRST BUSINESS FINANCIAL SERVICES, INC. (FBIZ)
UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
| Date of Report (Date of earliest event reported): October 30, 2025 |
|---|
First Business Financial Services, Inc.
(Exact name of Registrant as Specified in Its Charter)
| Wisconsin | 001-34095 | 39-1576570 |
|---|---|---|
| (State or Other Jurisdiction<br>of Incorporation) | (Commission File Number) | (IRS Employer<br>Identification No.) |
| 401 Charmany Drive | ||
| Madison, Wisconsin | 53719 | |
| (Address of Principal Executive Offices) | (Zip Code) | |
| Registrant’s Telephone Number, Including Area Code: 608 238-8008 | ||
| --- | ||
| N/A | ||
| --- |
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
|---|---|
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading<br>Symbol(s) | Name of each exchange on which registered |
|---|---|---|
| Common Stock, $0.01 par value | FBIZ | The Nasdaq Stock Market LLC |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02 Results of Operations and Financial Condition.
On October 30, 2025, First Business Financial Services, Inc. (the “Company”) announced its earnings for the quarter ended September 30, 2025. A copy of the Company’s press release containing this information is being “furnished” as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference.
Item 7.01 Regulation FD Disclosure.
On October 30, 2025, the Company posted an investor presentation to its website www.firstbusiness.bank under the “Investor Relations” tab. The information included in the presentation provides an overview of the Company’s recent operating performance, financial condition, and business strategy. The Company intends to use this presentation in connection with its third quarter 2025 earnings call to be held at 1:00 p.m. Central time on October 31, 2025, and from time to time when the Company's executives interact with shareholders, analysts, and other third parties. A copy of the registrant’s presentation is attached hereto as Exhibit 99.2 to this Current Report on Form 8-K and is incorporated herein by reference.
The information in Items 2.02 and 7.01 of this Current Report on Form 8-K and Exhibits 99.1 and 99.2 attached hereto is being “furnished” and will not, except to the extent required by applicable law or regulation, be deemed “filed” by the Company for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section, nor will any of such information or exhibits be deemed incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, except as expressly set forth by specific reference in such filing.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
The following exhibit is being “furnished” as part of this Current Report on Form 8-K:
| 99.1 | Press release of the registrant dated October 30, 2025, containing financial information for its quarter ended September 30, 2025. |
|---|---|
| 99.2 | Supplemental earnings call slides |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL Document) |
| --- | --- |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| October 30, 2025 | FIRST BUSINESS FINANCIAL SERVICES, INC. | |
|---|---|---|
| By: | /s/ Brian D. Spielmann | |
| Name: | Brian D. Spielmann | |
| Title: | Chief Financial Officer |
EX-99.1
Exhibit 99.1
FIRST BUSINESS BANK REPORTS THIRD QUARTER 2025 NET INCOME OF $14.2 million
-- Continued loan and deposit growth and record fee income drive robust earnings --
MADISON, Wis., October 30, 2025 (BUSINESS WIRE) -- First Business Financial Services, Inc. (the “Company”, the “Bank”, or “First Business Bank”) (Nasdaq:FBIZ) reported quarterly net income available to common shareholders of $14.2 million, or earnings per share ("EPS") of $1.70. This compares to net income available to common shareholders of $11.2 million, or $1.35 per share, in the second quarter of 2025 and $10.3 million, or $1.24 per share, in the third quarter of 2024.
“First Business Bank’s robust balance sheet growth and operating leverage drove outstanding financial performance during the quarter,” said Corey Chambas, Chief Executive Officer. “We continued to execute our relationship-based growth strategy, producing record pre-tax, pre-provision earnings, 10% loan growth, 9% core deposit growth, and a strong and stable net interest margin. We also experienced improved asset quality, including an 18% reduction in non-performing assets. This led to a 13% year-to-date increase in top-line revenue and drove exceptional growth in shareholder value, with tangible book value expanding 16% from the prior year.”
Quarterly Highlights
- Robust Loan Growth. Loans increased $84.6 million, or 10.4% annualized, from the second quarter of 2025, and $286.4 million, or 9.4%, from the third quarter of 2024, reflecting broad-based growth.
- Consistent Core Deposit Growth. Core deposits grew $59.0 million, or 9.3% annualized, from the linked quarter and $209.4 million, or 8.8%, from the third quarter of 2024. Core deposit funding mix improved to 73.12% compared to 71.82% in the linked quarter.
- Stable and Strong Net Interest Margin. The Company's effective match-funding strategy and pricing discipline produced a net interest margin of 3.68%, compared to 3.67% for the linked quarter and 3.64% for the prior year quarter. Net interest income increased 12.5% from the prior year quarter.
- Private Wealth Management Expansion. Private Wealth assets under management and administration grew to $3.814 billion, generating quarterly Private Wealth fee income of $3.7 million. Private Wealth fees increased by 13.0% from the prior year quarter and represented 45% of year-to-date total non-interest income.
- Record Pre-Tax, Pre-Provision ("PTPP") Income. PTPP income grew to $18.9 million, up 17.7% and 22.1% from the linked and prior year quarters, respectively. This performance reflects continued growth across the Company’s balance sheet coupled with record fee income and positive operating leverage.
- Continued Tangible Book Value Growth. The Company’s strong earnings and sound balance sheet management continued to drive growth in tangible book value per share, producing a 16.8% annualized increase compared to the linked quarter and a 15.6% increase compared to the prior year quarter.
Quarterly Financial Results
| (Unaudited) | As of and for the Three Months Ended | As of and for the Nine Months Ended | |||
|---|---|---|---|---|---|
| (Dollars in thousands, except per share amounts) | September 30,<br>2025 | June 30,<br>2025 | September 30,<br>2024 | September 30,<br>2025 | September 30,<br>2024 |
| Net interest income | $34,886 | $33,784 | $31,007 | $101,928 | $91,059 |
| Adjusted non-interest income (1) | 9,406 | 7,255 | 7,064 | 24,241 | 21,254 |
| Operating revenue (1) | 44,292 | 41,039 | 38,071 | 126,169 | 112,313 |
| Operating expense (1) | 25,440 | 25,023 | 22,630 | 75,081 | 69,584 |
| Pre-tax, pre-provision adjusted earnings (1) | 18,852 | 16,016 | 15,441 | 51,088 | 42,729 |
| Less: | |||||
| Provision for credit losses | 1,440 | 2,701 | 2,087 | 6,800 | 6,126 |
| Loss on repossessed assets | 31 | 4 | 11 | 27 | 162 |
| Contribution to First Business Charitable Foundation | 234 | — | — | 234 | — |
| SBA recourse (benefit) provision | (5) | (59) | 466 | (64) | 583 |
| Impairment of tax credit investments | — | — | — | 110 | — |
| Add: | |||||
| Bank-owned life insurance claim | 234 | — | — | 234 | — |
| Net loss on sale of securities | — | — | — | — | (8) |
| Income before income tax expense | 17,386 | 13,370 | 12,877 | 44,215 | 35,850 |
| Income tax expense | 2,993 | 1,948 | 2,351 | 7,229 | 6,020 |
| Net income | $14,393 | $11,422 | $10,526 | $36,986 | $29,830 |
| Preferred stock dividends | 218 | 219 | 218 | 656 | 656 |
| Net income available to common shareholders | $14,175 | $11,203 | $10,308 | $36,330 | $29,174 |
| Earnings per share, diluted | $1.70 | $1.35 | $1.24 | $4.37 | $3.50 |
| Book value per share | $41.60 | $39.98 | $36.17 | $41.60 | $36.17 |
| Tangible book value per share (1) | $40.16 | $38.54 | $34.74 | $40.16 | $34.74 |
| Net interest margin (2) | 3.68% | 3.67% | 3.64% | 3.68% | 3.62% |
| Adjusted net interest margin (1)(2) | 3.44% | 3.47% | 3.50% | 3.46% | 3.46% |
| Fee income ratio (non-interest income / total revenue) | 21.65% | 17.68% | 18.55% | 19.36% | 18.92% |
| Efficiency ratio (1) | 57.44% | 60.97% | 59.44% | 59.51% | 61.96% |
| Return on average assets (2) | 1.40% | 1.14% | 1.13% | 1.23% | 1.08% |
| Return on average tangible common equity (2) | 17.29% | 14.17% | 14.40% | 15.23% | 13.98% |
| Period-end loans and leases receivable | $3,334,956 | $3,250,925 | $3,050,079 | $3,334,956 | $3,050,079 |
| Average loans and leases receivable | $3,295,880 | $3,239,840 | $3,031,880 | $3,240,908 | $2,961,014 |
| Period-end core deposits | $2,592,110 | $2,533,099 | $2,382,730 | $2,592,110 | $2,382,730 |
| Average core deposits | $2,597,031 | $2,396,517 | $2,375,002 | $2,453,005 | $2,365,553 |
| Allowance for credit losses, including unfunded commitment reserves | $38,382 | $38,210 | $35,509 | $38,382 | $35,509 |
| Non-performing assets | $23,513 | $28,664 | $19,420 | $23,513 | $19,420 |
| Allowance for credit losses as a percent of total gross loans and leases | 1.15% | 1.18% | 1.16% | 1.15% | 1.16% |
| Non-performing assets as a percent of total assets | 0.58% | 0.72% | 0.52% | 0.58% | 0.52% |
- This is a non-GAAP financial measure. Management believes these measures are meaningful because they reflect adjustments commonly made by management, investors, regulators, and analysts to evaluate financial performance, provide greater understanding of ongoing operations, and enhance comparability of results with prior periods. See the section titled Non-GAAP Reconciliations at the end of this release for a reconciliation of GAAP financial measures to non-GAAP financial measures.
- Calculation is annualized.
Third Quarter 2025 Compared to Second Quarter 2025
Net interest income increased $1.1 million, or 3.3%, to $34.9 million.
- The increase in net interest income was driven by higher average loans and leases receivable and an increase in fees in lieu of interest. Average loans and leases receivable grew by $56.0 million, or 6.9% annualized, to $3.296 billion. Fees in lieu of interest, which vary from quarter to quarter based on client-driven activity, totaled $2.2 million, compared to $1.7 million in the prior quarter. Excluding fees in lieu of interest, net interest income increased $620,000, or 1.9%.
- The yield on average interest-earning assets increased seven basis points to 6.72% from 6.65%. Excluding fees in lieu of interest, the yield on average interest-earning assets increased two basis points to 6.49% from 6.47%.
- The rate paid for average core deposits increased 14 basis points to 2.89% from 2.75%. The rate paid for average total bank funding increased six basis points to 3.14% from 3.08%. Total bank funding is defined as total deposits plus Federal Home Loan Bank (“FHLB”) advances.
- Net interest margin was 3.68% compared to 3.67% for the linked quarter. Adjusted net interest margin1 was 3.44%, down three basis points compared to 3.47% in the linked quarter. The decrease in adjusted net interest margin was driven by an increase in the rate paid on total bank funding partially offset by an increase in the yield on interest-earning assets, excluding fees in lieu of interest.
- The Company maintains a long-term target for net interest margin in the range of 3.60% - 3.65%. Performance in future quarters will vary due to factors such as the level of fees in lieu of interest and the timing, pace, and scale of future interest rate changes.
The Bank reported provision for credit losses of $1.4 million compared to $2.7 million in the linked quarter. The current quarter provision reflects net chargeoffs, loan growth, and an increase in unfunded commitments partially offset by improvement in the economic outlook in our model forecast and a decrease in general reserve qualitative factors.
Non-interest income increased $2.4 million, or 32.9%, to $9.6 million.
- Other non-interest income increased $1.2 million, or 148.1% to $2.0 million. The increase was primarily driven by higher returns on the Company’s investments in Small Business Investment Company ("SBIC") funds and $537,000 of nonrecurring fee income in accounts receivable financing. Income from SBIC funds was $854,000 in the second quarter, compared to $200,000 in the linked quarter. Income from SBIC funds varies from period to period based on changes in the realized and unrealized fair value of underlying investments.
- Commercial loan swap fee income increased $804,000 to $974,000. Swap fee income varies from period to period based on loan activity and the interest rate environment.
- Bank-owned life insurance income increased $350,000 or 56.9%, to $965,000 primarily due to a $234,000 insurance claim received during the quarter.
Non-interest expense increased $732,000, or 2.9%, to $25.7 million, while operating expense increased $417,000, or 1.7%, to $25.4 million.
Compensation expense was $17.4 million, increasing $908,000, or 5.5%, primarily due to an increase in the annual cash bonus accrual. Excluding this accrual update, compensation was $16.4 million, reflecting a decrease of $183,000, or 1.1% from the linked quarter mainly due to a decrease in individual incentive compensation and social security taxes. Average full-time equivalents (“FTEs”) for the third quarter of 2025 were 366, up from 364 in the linked quarter.
Professional fees expense was $1.1 million, decreasing $416,000, or 28%, primarily due to annual vesting of director share-based compensation in the second quarter.
Adjusted net interest margin is a non-GAAP measure representing net interest income excluding fees in lieu of interest and other recurring, but volatile, components of net interest margin divided by average interest-earning assets less other recurring, but volatile, components of average interest-earning assets.
Data processing expense was $1.1 million, decreasing $245,000, or 17.9%, primarily due to annual expense related to tax processing on behalf of the Bank’s Private Wealth clients recognized in the second quarter.
Marketing expense was $876,000, decreasing $186,000, or 17.5%, primarily due to seasonality in sponsorships.
Computer software expense was $1.8 million, increasing $170,000, or 10.3%, due to ongoing investment in innovative technology to support growth initiatives, enhance productivity, and improve the client experience.
Income tax expense increased $1.0 million to $3.0 million. The effective tax rate was 17.2% for the three months ended September 30, 2025, compared to 14.6% for the linked quarter. The increase in tax expense reflects an increase in pre-tax income and annual return to provision adjustments including updating tax credit partnership estimates. The effective tax rate for the nine months ended September 30, 2025 was 16.3%. The Company expects to report an effective tax rate between 16% and 18% for 2025.
Total period-end loans and leases receivable increased $84.6 million, or 10.4% annualized, to $3.337 billion. The average rate earned on average loans and leases receivable was 7.10%, up 11 basis points from 6.99% in the prior quarter. Excluding fees in lieu of interest, the average rate earned on average loans and leases receivable was 6.84%, up six basis points from 6.78% in the prior quarter.
- Commercial Real Estate (“CRE”) loans increased by $80.0 million, or 16.4% annualized, to $2.027 billion, primarily due to growth in our Northeast Wisconsin, Southeast Wisconsin, and Kansas City markets.
- C&I loans increased $4.9 million, or 1.57% annualized, to $1.264 billion. The increase was due to growth in our Northeast Wisconsin, Southeast Wisconsin, and Kansas City Markets.
Total period-end core deposits increased $59.0 million, or 9.3% annualized, to $2.592 billion. The average rate paid was 2.89%, up 14 basis points from 2.75% in the prior quarter primarily due to an increase in higher-cost certificates of deposit.
Period-end wholesale funding, including FHLB advances and brokered deposits, decreased $40.6 million, or 4.1%, to $952.9 million. Consistent with the Bank’s long-held philosophy to minimize exposure to interest rate risk, management will continue to utilize the most efficient and cost-effective source of wholesale funds to match-fund fixed-rate loans, as necessary.
- Wholesale deposits decreased $31.2 million to $741.0 million. The average rate paid on wholesale deposits increased one basis point to 4.03% and the weighted average original maturity increased to 4.3 years from 4.1 years.
- FHLB advances decreased $9.5 million to $211.9 million. The average rate paid on FHLB advances decreased 16 basis points to 3.16% and the weighted average original maturity decreased to 5.3 years from 5.5 years.
Non-performing assets decreased $5.2 million to $23.5 million, or 0.58% of total assets, improving from 0.72% in the prior quarter. The decrease reflects pay downs on non-accrual C&I loans and charge-offs of previously reserved equipment finance loans, partially offset by new non-accrual equipment finance loans. We continue to expect full repayment of the previously disclosed Asset-Based Lending ("ABL") loan that defaulted during the second quarter of 2023. The liquidation process under Chapter 7 bankruptcy and related litigation has delayed final resolution. The current balance of this loan is $6.1 million. Excluding this ABL loan, non-performing assets totaled $17.4 million, or 0.43% of total assets in the current quarter and $22.6 million, or 0.56% of total assets in the linked quarter.
The allowance for credit losses, including the unfunded credit commitments reserve, increased $172,000, or 0.5%, primarily due to increases in general reserves driven by loan growth and an increase in unfunded commitments, partially offset by a decrease in specific reserve requirements, an improvement in the economic outlook in our model forecast, and improvement in qualitative factors. The allowance for credit losses, including unfunded credit commitment reserves, as a percent of total gross loans and leases was 1.15% compared to 1.18% in the prior quarter.
Third Quarter 2025 Compared to Third Quarter 2024
Net interest income increased $3.9 million, or 12.5%, to $34.9 million.
- Growth reflects higher average gross loans and leases as well as increased fees in lieu of interest, which grew by $1.0 million to $2.2 million, primarily due to a reclassification of loan fees that were previously classified as non-interest income as well as an increase in prepayment fees and non-accrual interest collected. Excluding fees in lieu of interest, net interest income increased $2.7 million, or 9.1%.
- The yield on average interest-earning assets decreased 25 basis points to 6.72% from 6.97%. Excluding fees in lieu of interest, the yield on average interest-earning assets measured 6.49% compared to 6.85%. This decrease in yield was primarily due to the decrease in short-term market rates partially offset by the reinvestment of cash flows from the securities and fixed-rate loan portfolios.
- The rate paid for average interest-bearing core deposits decreased 66 basis points to 3.44% from 4.10%. The rate paid for average total bank funding decreased 30 basis points to 3.14% from 3.44%.
- Net interest margin increased four basis points to 3.68% from 3.64%.
The Company reported provision for credit losses of $1.4 million, compared to $2.1 million in the third quarter of 2024. See the Provision for Credit Loss breakdown table below for more detail.
Non-interest income increased $2.6 million, or 36.5%, to $9.6 million.
- Other fee income increased $1.2 million, or 170.5%, to $2.0 million. The increase was primarily due to higher returns on the Company’s investments in SBIC funds and $537,000 of nonrecurring fee income in accounts receivable financing. Income from SBIC funds was $854,000 in the third quarter, compared to $193,000 in the prior year quarter. Income from SBIC funds varies from period to period based on changes in the realized and unrealized fair value of underlying investments.
- Bank-owned life insurance income increased $549,000 to $965,000 primarily due to the purchase of new policies and the aforementioned insurance claim.
- Commercial loan swap fee income increased $514,000 to $974,000. Swap fee income varies period to period based on loan activity and the interest rate environment.
- Private wealth fee income increased $423,000, or 13.0%, to $3.7 million. Private Wealth assets under management and administration measured $3.814 billion at September 30, 2025 up $415.9 million, or 12.2%.
- Loan fee income decreased $311,000 to $501,000 primarily due to a reclassification of certain types of C&I loan fees from non-interest income to interest income.
- Service charges on deposits increased $231,000, or 25.1%, to $1.2 million, primarily driven by new and expanded core deposit relationships.
Non-interest expense increased $2.6 million, or 11.2%, to $25.7 million. Operating expense increased $2.8 million, or 12.4%, to $25.4 million.
- Compensation expense increased $2.2 million, or 14.8%, to $17.4 million. Growth reflects an increase in average FTEs, annual merit increases and promotions, an increase in the cash bonus accrual, and decreased capitalized software development compensation. Average FTEs increased 3.1% to 366 in the third quarter of 2025, compared to 355 in the third quarter of 2024.
- Computer software expense increased $218,000, or 13.6%, to $1.8 million, due to ongoing investment in innovative technology to support growth initiatives, enhance productivity, and improve the client experience.
- Other non-interest expense increased $381,000, or 29.3%, to $1.7 million, primarily due to an increase in liquidation expenses, donations, and administrative costs in early stage limited partnership investments. This was partially offset by a decrease in SBA recourse provision.
- Professional fees decreased $234,000, or 17.9%, to $1.1 million, primarily due to timing of various consulting fees and legal fees.
Total period-end loans and leases receivable increased $286.4 million, or 9.4%, to $3.337 billion.
- CRE loans increased $110.1 million, or 6.0%, to $2.027 billion, primarily due to growth across the Wisconsin and Kansas City markets.
- C&I loans increased $112.4 million, or 9.6%, to $1.264 billion, primarily due to growth across our bank markets and in our floorplan and equipment finance businesses.
Total period-end core deposits grew $209.4 million, or 8.8%, to $2.592 billion. The average rate paid decreased 45 basis points to 2.89%, reflecting a decrease in short-term market rates. Total average core deposits grew $222.0 million, or 9.3%, to $2.597 billion.
Period-end wholesale funding increased $82.5 million, or 28.0%, to $952.9 million.
- Wholesale deposits increased $153.7 million, or 26.2%, to $741.0 million, as the Bank utilized more wholesale deposits in lieu of FHLB advances to maintain excess liquidity and to match-fund fixed-rate assets. The average rate paid on wholesale deposits decreased nine basis points to 4.03% and the weighted average original maturity increased to 4.3 years from 4.0 years.
- FHLB advances decreased $82.5 million to $211.9 million. The average rate paid on FHLB advances increased 20 basis points to 3.16% and the weighted average original maturity remained flat at 5.3 years.
Non-performing assets increased to $23.5 million, or 0.58% of total assets, compared to $19.4 million, or 0.52% of total assets, primarily driven by new non-accrual loans in the C&I transportation and logistics portfolio partially offset lower non-accrual equipment finance loans. Excluding the ABL loan described above for which we expect full repayment, non-performing assets totaled $17.4 million, or 0.43% of total assets and $13.0 million, or 0.35% of total assets in the prior year quarter.
The allowance for credit losses, including unfunded commitment reserves, increased $2.9 million to $38.4 million primarily due to higher general reserves as a result of loan growth and quantitative factors partially offset by lower specific reserves. The allowance for credit losses as a percent of total gross loans and leases was 1.15%, compared with 1.16% in the prior year.
2026 CEO Succession Plan
On May 5, 2025, the Company announced that Corey A. Chambas intends to retire from his role as Chief Executive Officer on May 2, 2026. The Company will name President and Chief Operating Officer David R. Seiler to succeed him as CEO effective the same date.
Earnings Release Supplement and Conference Call
On October 30, 2025, the Company posted an earnings release supplement to its website firstbusiness.bank under the “Investor Relations” tab which will also be furnished to the U.S. Securities and Exchange Commission on October 30, 2025. The information included in the supplement provides an overview of the Company’s recent operating performance, financial condition, and other data relevant to the quarter. The Company intends to use this supplement in connection with its third quarter 2025 earnings call to be held at 1:00 p.m. Central time on October 31, 2025. The conference call can be accessed at 800-549-8228 (646-564-2877 if outside the United States and Canada), using the conference call access code: FBIZ, 82881. Investors may also listen live via webcast at: https://events.q4inc.com/attendee/466645836. A replay of the call will be available through Friday, November 7, 2025, by calling 888-660-6264 (646-517-3975 if outside the United States and Canada). The webcast archive of the conference call will be available on the Company’s website, ir.firstbusiness.bank.
About First Business Bank
First Business Bank® specializes in Business Banking, including Commercial Banking and Specialty Finance, Private Wealth, and Bank Consulting services, and through its refined focus delivers unmatched expertise, accessibility, and responsiveness. Specialty Finance solutions are delivered through First Business Bank’s wholly owned subsidiary First Business Specialty Finance, LLC®. First Business Bank is a wholly owned subsidiary of First Business Financial Services, Inc®. (Nasdaq: FBIZ). For additional information, visit firstbusiness.bank.
This release may include forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995, which reflect First Business Bank’s current views with respect to future events and financial performance. Forward-looking statements are not based on historical information, but rather are related to future operations, strategies, financial results, or other developments. Forward-looking statements are based on management’s expectations as well as certain assumptions and estimates made by, and information available to, management at the time the statements are made. Those statements are based on general assumptions and are subject to various risks, uncertainties, and other factors that may cause actual results to differ materially from the views, beliefs, and projections expressed in such statements. Such statements are subject to risks and uncertainties, including among other things:
Adverse changes in the economy or business conditions, either nationally or in our markets including, without limitation, inflation, economic downturn, labor shortages, wage pressures, and the adverse effects of public health events on the global, national, and local economy.
Uncertainty created by potential federal government actions relating to the authority of regulatory agencies (including bank regulators), international trade policy, prolonged shutdown of the federal government, and other significant policy matters.
Competitive pressures among depository and other financial institutions nationally and in the Company’s markets.
Increases in defaults by borrowers and other delinquencies.
Management’s ability to manage growth effectively, including the successful expansion of our client support, administrative infrastructure, and internal management systems.
Fluctuations in interest rates and market prices.
Changes in legislative or regulatory requirements applicable to the Company and its subsidiaries.
Changes in tax requirements, including tax rate changes, new tax laws, and revised tax law interpretations.
Fraud, including client and system failure or breaches of our network security, including the Company’s internet banking activities.
Failure to comply with the applicable SBA regulations in order to maintain the eligibility of the guaranteed portion of SBA loans.
Ongoing volatility in the banking sector may result in new legislation, regulations or policy changes that could subject the Company and the Bank to increased government regulation and supervision.
The proportion of the Company’s deposit account balances that exceed FDIC insurance limits may expose the Bank to enhanced liquidity risk.
For further information about the factors that could affect the Company’s future results, please see the Company’s annual report on Form 10-K for the year ended December 31, 2024, and other filings with the Securities and Exchange Commission.
| CONTACT: | First Business Financial Services, Inc. |
|---|---|
| Brian D. Spielmann | |
| Chief Financial Officer | |
| 608-232-5977 | |
| bspielmann@firstbusiness.bank |
SELECTED FINANCIAL CONDITION DATA
| (Unaudited) | As of | ||||
|---|---|---|---|---|---|
| (in thousands) | September 30,<br>2025 | June 30,<br>2025 | March 31,<br>2025 | December 31,<br>2024 | September 30,<br>2024 |
| Assets | |||||
| Cash and cash equivalents | $44,349 | $123,208 | $170,617 | $157,702 | $131,972 |
| Securities available-for-sale, at fair value | 411,111 | 382,365 | 359,394 | 341,392 | 313,336 |
| Securities held-to-maturity, at amortized cost | 5,584 | 5,714 | 6,590 | 6,741 | 6,907 |
| Loans held for sale | 13,482 | 12,415 | 10,523 | 13,498 | 8,173 |
| Loans and leases receivable | 3,334,956 | 3,250,925 | 3,184,400 | 3,113,128 | 3,050,079 |
| Allowance for credit losses | (36,690) | (36,861) | (35,236) | (35,785) | (33,688) |
| Loans and leases receivable, net | 3,298,266 | 3,214,064 | 3,149,164 | 3,077,343 | 3,016,391 |
| Premises and equipment, net | 4,936 | 5,063 | 5,017 | 5,227 | 5,478 |
| Repossessed assets | — | 31 | 36 | 51 | 56 |
| Right-of-use assets | 5,577 | 5,713 | 5,439 | 5,702 | 5,789 |
| Bank-owned life insurance | 83,255 | 82,761 | 57,647 | 57,210 | 56,767 |
| Federal Home Loan Bank stock, at cost | 9,605 | 10,027 | 10,434 | 11,616 | 12,775 |
| Goodwill and other intangible assets | 12,041 | 12,049 | 12,058 | 11,912 | 11,834 |
| Derivatives | 37,634 | 40,814 | 48,405 | 65,762 | 42,539 |
| Accrued interest receivable and other assets | 109,005 | 108,501 | 109,555 | 99,059 | 103,707 |
| Total assets | $4,034,845 | $4,002,725 | $3,944,879 | $3,853,215 | $3,715,724 |
| Liabilities and Stockholders’ Equity | |||||
| Core deposits | $2,592,110 | $2,533,099 | $2,462,695 | $2,396,429 | $2,382,730 |
| Wholesale deposits | 740,961 | 772,123 | 780,348 | 710,711 | 587,217 |
| Total deposits | 3,333,071 | 3,305,222 | 3,243,043 | 3,107,140 | 2,969,947 |
| Federal Home Loan Bank advances and<br> other borrowings | 266,677 | 276,131 | 286,590 | 320,049 | 349,109 |
| Lease liabilities | 7,687 | 7,887 | 7,604 | 7,926 | 8,054 |
| Derivatives | 38,726 | 41,228 | 45,612 | 57,068 | 45,399 |
| Accrued interest payable and other liabilities | 30,365 | 27,462 | 25,967 | 32,443 | 31,233 |
| Total liabilities | 3,676,526 | 3,657,930 | 3,608,816 | 3,524,626 | 3,403,742 |
| Total stockholders’ equity | 358,319 | 344,795 | 336,063 | 328,589 | 311,982 |
| Total liabilities and stockholders’ equity | $4,034,845 | $4,002,725 | $3,944,879 | $3,853,215 | $3,715,724 |
STATEMENTS OF INCOME
| (Unaudited) | As of and for the Three Months Ended | As of and for the Nine Months Ended | |||||
|---|---|---|---|---|---|---|---|
| (Dollars in thousands, except per share amounts) | September 30,<br>2025 | June 30,<br>2025 | March 31,<br>2025 | December 31,<br>2024 | September 30,<br>2024 | September 30,<br>2025 | September 30,<br>2024 |
| Total interest income | $63,746 | $61,282 | $59,530 | $60,110 | $59,327 | $184,558 | $173,020 |
| Total interest expense | 28,860 | 27,498 | 26,272 | 26,962 | 28,320 | 82,630 | 81,961 |
| Net interest income | 34,886 | 33,784 | 33,258 | 33,148 | 31,007 | 101,928 | 91,059 |
| Provision for credit losses | 1,440 | 2,701 | 2,659 | 2,701 | 2,087 | 6,800 | 6,126 |
| Net interest income after provision for credit losses | 33,446 | 31,083 | 30,599 | 30,447 | 28,920 | 95,128 | 84,933 |
| Private wealth management service fees | 3,687 | 3,748 | 3,492 | 3,426 | 3,264 | 10,928 | 9,835 |
| Gain on sale of SBA loans | 382 | 397 | 963 | 938 | 460 | 1,742 | 1,004 |
| Service charges on deposits | 1,151 | 1,103 | 1,048 | 960 | 920 | 3,303 | 2,810 |
| Loan fees | 501 | 424 | 388 | 914 | 812 | 1,313 | 2,486 |
| Bank owned life insurance income | 965 | 615 | 437 | 418 | 416 | 2,016 | 1,231 |
| Loss on sale of securities | — | — | — | — | 0 | — | (8) |
| Swap fees | 974 | 170 | 113 | 588 | 460 | 1,257 | 815 |
| Other non-interest income | 1,980 | 798 | 1,138 | 761 | 732 | 3,916 | 3,073 |
| Total non-interest income | 9,640 | 7,255 | 7,579 | 8,005 | 7,064 | 24,475 | 21,246 |
| Compensation | 17,442 | 16,534 | 16,747 | 15,535 | 15,198 | 50,723 | 47,570 |
| Occupancy | 567 | 564 | 590 | 588 | 585 | 1,721 | 1,785 |
| Professional fees | 1,071 | 1,487 | 1,459 | 1,323 | 1,305 | 4,016 | 4,348 |
| Data processing | 1,123 | 1,368 | 1,082 | 1,647 | 1,045 | 3,574 | 3,245 |
| Marketing | 876 | 1,062 | 968 | 928 | 922 | 2,906 | 2,591 |
| Equipment | 296 | 335 | 376 | 301 | 333 | 1,007 | 1,013 |
| Computer software | 1,826 | 1,656 | 1,603 | 1,585 | 1,608 | 5,085 | 4,581 |
| FDIC insurance | 817 | 834 | 780 | 728 | 810 | 2,432 | 2,032 |
| Other non-interest expense | 1,682 | 1,128 | 1,114 | 517 | 1,301 | 3,924 | 3,164 |
| Total non-interest expense | 25,700 | 24,968 | 24,719 | 23,152 | 23,107 | 75,388 | 70,329 |
| Income before income tax expense | 17,386 | 13,370 | 13,459 | 15,300 | 12,877 | 44,215 | 35,850 |
| Income tax expense | 2,993 | 1,948 | 2,288 | 885 | 2,351 | 7,229 | 6,020 |
| Net income | $14,393 | $11,422 | $11,171 | $14,415 | $10,526 | $36,986 | $29,830 |
| Preferred stock dividends | 218 | 219 | 219 | 219 | 218 | 656 | 656 |
| Net income available to common shareholders | $14,175 | $11,203 | $10,952 | $14,196 | $10,308 | $36,330 | $29,174 |
| Per common share: | |||||||
| Basic earnings | $1.70 | $1.35 | $1.32 | $1.71 | $1.24 | $4.37 | $3.50 |
| Diluted earnings | $1.70 | $1.35 | $1.32 | $1.71 | $1.24 | $4.37 | $3.50 |
| Dividends declared | $0.29 | $0.29 | $0.29 | $0.25 | $0.25 | $0.87 | $0.75 |
| Book value | $41.60 | $39.98 | $39.04 | $38.17 | $36.17 | $41.60 | $36.17 |
| Tangible book value | $40.16 | $38.54 | $37.58 | $36.74 | $34.74 | $40.16 | $34.74 |
| Weighted-average common shares<br> outstanding(1) | 8,171,404 | 8,141,159 | 8,130,743 | 8,107,308 | 8,111,215 | 8,153,181 | 8,149,949 |
| Weighted-average diluted common<br> shares outstanding(1) | 8,171,404 | 8,141,159 | 8,130,743 | 8,107,308 | 8,111,215 | 8,153,181 | 8,149,949 |
- Excluding participating securities.
NET INTEREST INCOME ANALYSIS
| (Unaudited) | For the Three Months Ended | ||
|---|---|---|---|
| (Dollars in thousands) | September 30, 2025 | June 30, 2025 | September 30, 2024 |
| AverageBalance | AverageBalance | AverageBalance | |
| Interest-earning assets | |||
| Commercial real estate and<br> other mortgage loans(1) | 1,986,541 | 1,932,593 | 1,805,020 |
| Commercial and industrial<br> loans(1) | 1,259,448 | 1,257,296 | 1,177,112 |
| Consumer and other loans(1) | 49,891 | 49,951 | 49,748 |
| Total loans and leases<br> receivable(1) | 3,295,880 | 3,239,840 | 3,031,880 |
| Mortgage-related securities(2) | 350,971 | 334,159 | 269,842 |
| Other investment securities(3) | 47,367 | 46,416 | 51,446 |
| FHLB stock | 9,420 | 12,852 | 11,960 |
| Short-term investments | 90,852 | 52,772 | 40,406 |
| Total interest-earning assets | 3,794,490 | 3,686,039 | 3,405,534 |
| Non-interest-earning assets | 249,026 | 242,048 | 231,353 |
| Total assets | 4,043,516 | 3,928,087 | 3,636,887 |
| Interest-bearing liabilities | |||
| Transaction accounts | 1,050,822 | 985,606 | 864,936 |
| Money market | 851,659 | 821,845 | 850,590 |
| Certificates of deposit | 278,191 | 178,643 | 219,315 |
| Wholesale deposits | 754,690 | 773,750 | 531,472 |
| Total interest-bearing<br> deposits | 2,935,362 | 2,759,844 | 2,466,313 |
| FHLB advances | 207,762 | 284,428 | 278,103 |
| Other borrowings | 54,761 | 54,733 | 50,642 |
| Total interest-bearing<br> liabilities | 3,197,885 | 3,099,005 | 2,795,058 |
| Non-interest-bearing demand<br> deposit accounts | 416,359 | 410,423 | 440,161 |
| Other non-interest-bearing<br> liabilities | 77,300 | 78,388 | 91,520 |
| Total liabilities | 3,691,544 | 3,587,816 | 3,326,739 |
| Stockholders’ equity | 351,972 | 340,271 | 310,148 |
| Total liabilities and<br> stockholders’ equity | 4,043,516 | 3,928,087 | 3,636,887 |
| Net interest income | |||
| Interest rate spread | |||
| Net interest-earning assets | 596,605 | 587,034 | 610,476 |
| Net interest margin |
All values are in US Dollars.
- The average balances of loans and leases include non-accrual loans and leases and loans held for sale. Interest income related to non-accrual loans and leases is recognized when collected. Interest income includes net loan fees collected in lieu of interest.
- Includes amortized cost basis of assets available for sale and held to maturity.
- Yields on tax-exempt municipal obligations are not presented on a tax-equivalent basis in this table.
- Represents annualized yields/rates.
PROVISION FOR CREDIT LOSS COMPOSITION
| (Unaudited) | For the Three Months Ended | For the Nine Months Ended | |||||
|---|---|---|---|---|---|---|---|
| (Dollars in thousands) | September 30,<br>2025 | June 30,<br>2025 | March 31,<br>2025 | December 31,<br>2024 | September 30,<br>2024 | September 30,<br>2025 | September 30,<br>2024 |
| Change due to qualitative factors | $(243) | $590 | $(355) | $(460) | $(444) | $(8) | $793 |
| Change due to quantitative factors | (173) | 746 | 1,560 | (598) | (330) | 2,133 | (380) |
| Charge-offs | 1,708 | 1,338 | 3,810 | 1,132 | 1,619 | 6,856 | 4,123 |
| Recoveries | (440) | (332) | (398) | (190) | (91) | (1,170) | (509) |
| Change in reserves on individually<br> evaluated loans, net | (550) | (247) | (2,495) | 2,579 | 757 | (3,292) | 348 |
| Change due to loan growth, net | 795 | 536 | 741 | 577 | 616 | 2,072 | 1,652 |
| Change in unfunded commitment<br> reserves | 343 | 70 | (204) | (339) | (40) | 209 | 99 |
| Total provision for credit losses | $1,440 | $2,701 | $2,659 | $2,701 | $2,087 | $6,800 | $6,126 |
ALLOWANCE FOR CREDIT LOSS COMPOSITION
| As of | ||||
|---|---|---|---|---|
| September 30,2025 | June 30, 2025 | March 31,2025 | December 31,2024 | |
| (In Thousands) | (In Thousands) | (In Thousands) | (In Thousands) | |
| Allowance for credit losses: | ||||
| Loans collectively evaluated | 31,065 | 30,685 | 28,813 | 26,867 |
| Loans individually evaluated | 5,625 | 6,176 | 6,423 | 8,918 |
| Unfunded commitments reserve | 1,692 | 1,349 | 1,279 | 1,483 |
| Total | 38,382 | 38,210 | 36,515 | 37,268 |
| Loans and lease receivables: | 3,334,956 | 3,250,925 | 3,184,400 | 3,113,128 |
All values are in US Dollars.
PERFORMANCE RATIOS
| For the Three Months Ended | For the Nine Months Ended | ||||||
|---|---|---|---|---|---|---|---|
| (Unaudited) | September 30,<br>2025 | June 30,<br>2025 | March 31,<br>2025 | December 31,<br>2024 | September 30,<br>2024 | September 30,<br>2025 | September 30,<br>2024 |
| Return on average assets (annualized) | 1.40% | 1.14% | 1.14% | 1.52% | 1.13% | 1.23% | 1.08% |
| Return on average tangible common equity (annualized) | 17.29% | 14.17% | 14.13% | 19.21% | 14.40% | 15.23% | 13.98% |
| Efficiency ratio | 57.44% | 60.97% | 60.28% | 56.94% | 59.44% | 59.51% | 61.96% |
| Interest rate spread | 3.11% | 3.10% | 3.11% | 3.11% | 2.92% | 3.11% | 2.91% |
| Net interest margin | 3.68% | 3.67% | 3.69% | 3.77% | 3.64% | 3.68% | 3.62% |
| Average interest-earning assets to average interest-bearing liabilities | 118.66% | 118.94% | 119.95% | 121.59% | 121.84% | 119.17% | 121.78% |
ASSET QUALITY RATIOS
| (Unaudited) | As of | ||||
|---|---|---|---|---|---|
| (Dollars in thousands) | September 30,<br>2025 | June 30,<br>2025 | March 31,<br>2025 | December 31,<br>2024 | September 30,<br>2024 |
| Non-accrual loans and leases | $23,513 | $28,633 | $24,056 | $28,367 | $19,364 |
| Repossessed assets | 0 | 31 | 36 | 51 | 56 |
| Total non-performing assets | $23,513 | $28,664 | $24,092 | $28,418 | $19,420 |
| Non-accrual loans and leases as a<br> percent of total gross loans and leases | 0.70% | 0.88% | 0.76% | 0.91% | 0.63% |
| Non-performing assets as a percent of<br> total gross loans and leases plus<br> repossessed assets | 0.70% | 0.88% | 0.76% | 0.91% | 0.64% |
| Non-performing assets as a percent of<br> total assets | 0.58% | 0.72% | 0.61% | 0.74% | 0.52% |
| Allowance for credit losses as a percent<br> of total gross loans and leases | 1.15% | 1.18% | 1.15% | 1.20% | 1.16% |
| Allowance for credit losses as a percent<br> of non-accrual loans and leases | 163.24% | 133.45% | 151.79% | 131.38% | 183.38% |
NET CHARGE-OFFS (RECOVERIES)
| (Unaudited) | For the Three Months Ended | For the Nine Months Ended | |||||
|---|---|---|---|---|---|---|---|
| (Dollars in thousands) | September 30,<br>2025 | June 30,<br>2025 | March 31,<br>2025 | December 31,<br>2024 | September 30,<br>2024 | September 30,<br>2025 | September 30,<br>2024 |
| Charge-offs | $1,708 | $1,338 | $3,810 | $1,132 | $1,619 | $6,856 | $4,123 |
| Recoveries | (440) | (332) | (398) | (190) | (91) | (1,170) | (509) |
| Net charge-offs (recoveries) | $1,268 | $1,006 | $3,412 | $942 | $1,528 | $5,686 | $3,614 |
| Net charge-offs (recoveries) as a percent of average gross loans and leases (annualized) | 0.15% | 0.12% | 0.43% | 0.12% | 0.20% | 0.23% | 0.16% |
CAPITAL RATIOS
| As of and for the Three Months Ended | |||||
|---|---|---|---|---|---|
| (Unaudited) | September 30,<br>2025 | June 30,<br>2025 | March 31,<br>2025 | December 31,<br>2024 | September 30,<br>2024 |
| Total capital to risk-weighted assets | 12.18% | 12.25% | 12.20% | 12.08% | 11.72% |
| Tier I capital to risk-weighted assets | 9.67% | 9.66% | 9.60% | 9.45% | 9.11% |
| Common equity tier I capital to risk-<br> weighted assets | 9.34% | 9.33% | 9.26% | 9.10% | 8.76% |
| Tier I capital to adjusted assets | 8.87% | 8.82% | 8.77% | 8.78% | 8.68% |
| Tangible common equity to tangible<br> assets | 8.31% | 8.04% | 7.93% | 7.93% | 7.78% |
LOAN AND LEASE RECEIVABLE COMPOSITION
| (Unaudited) | As of | ||||
|---|---|---|---|---|---|
| (in thousands) | September 30,<br>2025 | June 30,<br>2025 | March 31,<br>2025 | December 31,<br>2024 | September 30,<br>2024 |
| Commercial real estate: | |||||
| Commercial real estate - owner occupied | $287,005 | $262,988 | $258,050 | $273,397 | $259,532 |
| Commercial real estate - non-owner occupied | 871,807 | 846,990 | 838,634 | 845,298 | 768,195 |
| Construction | 236,590 | 218,840 | 215,613 | 221,086 | 266,762 |
| Multi-family | 565,102 | 573,208 | 549,220 | 530,853 | 494,954 |
| 1-4 family | 66,735 | 45,171 | 48,450 | 46,496 | 39,933 |
| Total commercial real estate | 2,027,239 | 1,947,197 | 1,909,967 | 1,917,130 | 1,829,376 |
| Commercial and industrial | 1,264,111 | 1,259,171 | 1,229,098 | 1,151,720 | 1,174,295 |
| Consumer and other | 45,323 | 45,744 | 46,190 | 45,000 | 46,610 |
| Total gross loans and leases receivable | 3,336,673 | 3,252,112 | 3,185,255 | 3,113,850 | 3,050,281 |
| Less: | |||||
| Allowance for credit losses | 36,690 | 36,861 | 35,236 | 35,785 | 33,688 |
| Deferred loan fees | 1,717 | 1,187 | 855 | 722 | 202 |
| Loans and leases receivable, net | $3,298,266 | $3,214,064 | $3,149,164 | $3,077,343 | $3,016,391 |
DEPOSIT COMPOSITION
| (Unaudited) | As of | ||||
|---|---|---|---|---|---|
| (in thousands) | September 30,<br>2025 | June 30,<br>2025 | March 31,<br>2025 | December 31,<br>2024 | September 30,<br>2024 |
| Non-interest-bearing transaction accounts | $400,697 | $396,448 | $433,201 | $436,111 | $428,012 |
| Interest-bearing transaction accounts | 1,050,233 | 1,047,434 | 1,015,846 | 965,637 | 930,252 |
| Money market accounts | 840,477 | 833,684 | 831,897 | 809,695 | 817,129 |
| Certificates of deposit | 300,703 | 255,533 | 181,751 | 184,986 | 207,337 |
| Wholesale deposits | 740,961 | 772,123 | 780,348 | 710,711 | 587,217 |
| Total deposits | $3,333,071 | $3,305,222 | $3,243,043 | $3,107,140 | $2,969,947 |
| Uninsured deposits | $1,100,868 | $1,069,509 | $1,055,347 | $980,278 | $1,088,496 |
| Less: uninsured deposits collateralized by pledged assets | 72,561 | 67,990 | 9,344 | 6,864 | 10,755 |
| Total uninsured, net of collateralized deposits | $1,028,307 | $1,001,519 | $1,046,003 | $973,414 | $1,077,741 |
| % of total deposits | 30.9% | 30.3% | 32.3% | 31.3% | 36.3% |
SOURCES OF LIQUIDITY
| (Unaudited) | As of | ||||
|---|---|---|---|---|---|
| (in thousands) | September 30,<br>2025 | June 30,<br>2025 | March 31,<br>2025 | December 31,<br>2024 | September 30,<br>2024 |
| Short-term investments | $8,074 | $72,520 | $136,033 | $128,207 | $86,670 |
| Collateral value of unencumbered pledged loans | 906,042 | 893,499 | 973,494 | 444,453 | 397,852 |
| Market value of unencumbered securities | 376,783 | 347,196 | 324,365 | 310,125 | 279,191 |
| Readily accessible liquidity | 1,290,899 | 1,313,215 | 1,433,892 | 882,785 | 763,713 |
| Fed fund lines | 45,000 | 45,000 | 45,000 | 45,000 | 45,000 |
| Excess brokered CD capacity(1) | 732,951 | 645,843 | 477,468 | 981,463 | 1,102,767 |
| Total liquidity | $2,068,850 | $2,004,058 | $1,956,360 | $1,909,248 | $1,911,480 |
| Total uninsured, net of collateralized deposits | $1,028,307 | $1,001,519 | $1,046,003 | $973,414 | $1,077,741 |
- Bank internal policy limits brokered CDs to 50% of total bank funding when combined with value of unencumbered pledged loans.
PRIVATE WEALTH OFF-BALANCE SHEET COMPOSITION
| (Unaudited) | As of | ||||
|---|---|---|---|---|---|
| (in thousands) | September 30,<br>2025 | June 30,<br>2025 | March 31,<br>2025 | December 31,<br>2024 | September 30,<br>2024 |
| Trust assets under management | $3,543,594 | $3,461,659 | $3,184,197 | $3,160,449 | $3,145,789 |
| Trust assets under administration | 270,222 | 268,996 | 240,366 | 258,255 | 252,152 |
| Total trust assets | $3,813,816 | $3,730,655 | $3,424,563 | $3,418,704 | $3,397,941 |
NON-GAAP RECONCILIATIONS
Certain financial information provided in this release is determined by methods other than in accordance with generally accepted accounting principles (United States) (“GAAP”). Although the Company’s management believes that these non-GAAP financial measures provide a greater understanding of its business, these measures are not necessarily comparable to similar measures that may be presented by other companies.
TANGIBLE BOOK VALUE
“Tangible book value per share” is a non-GAAP measure representing tangible common equity divided by total common shares outstanding. “Tangible common equity” itself is a non-GAAP measure representing common stockholders’ equity reduced by intangible assets, if any. The Company’s management believes that this measure is important to many investors in the marketplace who are interested in period-to-period changes in book value per common share exclusive of changes in intangible assets. The information provided below reconciles tangible book value per share and tangible common equity to their most comparable GAAP measures.
| (Unaudited) | As of | ||||
|---|---|---|---|---|---|
| (Dollars in thousands, except per share amounts) | September 30,<br>2025 | June 30,<br>2025 | March 31,<br>2025 | December 31,<br>2024 | September 30,<br>2024 |
| Common stockholders’ equity | $346,327 | $332,803 | $324,071 | $316,597 | $299,990 |
| Less: Goodwill and other intangible assets | (12,041) | (12,049) | (12,058) | (11,912) | (11,834) |
| Tangible common equity | $334,286 | $320,754 | $312,013 | $304,685 | $288,156 |
| Common shares outstanding | 8,324,387 | 8,323,470 | 8,301,967 | 8,293,928 | 8,295,017 |
| Book value per share | $41.60 | $39.98 | $39.04 | $38.17 | $36.17 |
| Tangible book value per share | $40.16 | $38.54 | $37.58 | $36.74 | $34.74 |
TANGIBLE COMMON EQUITY TO TANGIBLE ASSETS
“Tangible common equity to tangible assets” (“TCE”) is defined as the ratio of common stockholders’ equity reduced by intangible assets, if any, divided by total assets reduced by intangible assets, if any. Adjusted TCE ratio is defined as TCE adjusted for net fair value adjustments of financial assets and liabilities. For more information on fair value adjustments please refer to Note 19 - Fair Value Disclosures in the annual report on Form 10-K for the year ended December 31, 2024. The Company’s management believes that this measure is important to many investors in the marketplace who are interested in the relative changes from period to period in common equity and total assets, each exclusive of changes in intangible assets. The information below reconciles tangible common equity and tangible assets to their most comparable GAAP measures.
| (Unaudited) | As of | ||||
|---|---|---|---|---|---|
| (Dollars in thousands) | September 30,<br>2025 | June 30,<br>2025 | March 31,<br>2025 | December 31,<br>2024 | September 30,<br>2024 |
| Common stockholders’ equity | $346,327 | $332,803 | $324,071 | $316,597 | $299,990 |
| Less: Goodwill and other intangible assets | (12,041) | (12,049) | (12,058) | (11,912) | (11,834) |
| Tangible common equity (a) | $334,286 | $320,754 | $312,013 | $304,685 | $288,156 |
| Total assets | $4,034,845 | $4,002,725 | $3,944,879 | $3,853,215 | $3,715,724 |
| Less: Goodwill and other intangible assets | (12,041) | (12,049) | (12,058) | (11,912) | (11,834) |
| Tangible assets (b) | $4,022,804 | $3,990,676 | $3,932,821 | $3,841,303 | $3,703,890 |
| Tangible common equity to tangible assets | 8.31% | 8.04% | 7.93% | 7.93% | 7.78% |
| Fair Value Adjustments: | |||||
| Financial assets - MTM (c) | $(11,278) | $(30,996) | $(20,528) | $(26,580) | $(17,615) |
| Financial liabilities - MTM (d) | $2,601 | $2,563 | $5,460 | $5,946 | $8,358 |
| Net MTM, after-tax e = (c-d)*(1-21%) | $(6,855) | $(22,462) | $(11,904) | $(16,301) | $(7,313) |
| Adjusted tangible equity f = (a-e) | $327,431 | $298,292 | $300,109 | $288,384 | $280,843 |
| Adjusted tangible assets g = (b-c) | $4,011,526 | $3,959,680 | $3,912,293 | $3,814,723 | $3,686,275 |
| Adjusted TCE ratio (f/g) | 8.16% | 7.53% | 7.67% | 7.56% | 7.62% |
EFFICIENCY RATIO & PRE-TAX, PRE-PROVISION ADJUSTED EARNINGS
“Efficiency ratio” is a non-GAAP measure representing non-interest expense excluding the effects of the SBA recourse provision, impairment of tax credit investments, losses or gains on repossessed assets, amortization of other intangible assets and other discrete items, if any, divided by operating revenue, which is equal to net interest income plus non-interest income less realized gains or losses on securities, if any. “Pre-tax, pre-provision adjusted earnings” is defined as operating revenue less operating expense. In the judgment of the Company’s management, the adjustments made to non-interest expense and non-interest income allow investors and analysts to better assess the Company’s operating expenses in relation to its core operating revenue by removing the volatility that is associated with certain one-time items and other discrete items. The information provided below reconciles the efficiency ratio and pre-tax, pre-provision adjusted earnings to its most comparable GAAP measure.
| (Unaudited) | For the Three Months Ended | For the Nine Months Ended | |||||
|---|---|---|---|---|---|---|---|
| (Dollars in thousands) | September 30,<br>2025 | June 30,<br>2025 | March 31,<br>2025 | December 31,<br>2024 | September 30,<br>2024 | September 30,<br>2025 | September 30,<br>2024 |
| Total non-interest expense | $25,700 | $24,968 | $24,719 | $23,152 | $23,107 | $75,388 | $70,329 |
| Less: | |||||||
| Net (gain) loss on repossessed assets | 31 | 4 | (8) | 5 | 11 | 27 | 72 |
| Impairment of tax credit investments | — | — | 110 | 400 | — | 110 | — |
| Contribution to First Business Charitable Foundation | 234 | 234 | — | ||||
| SBA recourse provision (benefit) | (5) | (59) | — | (687) | 466 | (64) | 583 |
| Total operating expense (a) | $25,440 | $25,023 | $24,617 | $23,434 | $22,630 | $75,081 | $69,674 |
| Net interest income | $34,886 | $33,784 | $33,258 | $33,148 | $31,007 | $101,928 | $91,059 |
| Total non-interest income | 9,640 | 7,255 | 7,579 | 8,005 | 7,064 | 24,475 | 21,246 |
| Less: | |||||||
| Net loss on sale of securities | — | — | — | — | — | — | (8) |
| Bank owned life insurance claim | 234 | — | — | — | — | 234 | 0 |
| Adjusted non-interest income | 9,406 | 7,255 | 7,579 | 8,005 | 7,064 | 24,241 | 21,254 |
| Total operating revenue (b) | $44,292 | $41,039 | $40,837 | $41,153 | $38,071 | $126,169 | $112,313 |
| Efficiency ratio | 57.44% | 60.97% | 60.28% | 56.94% | 59.44% | 59.51% | 62.04% |
| Pre-tax, pre-provision adjusted earnings (b - a) | $18,852 | $16,016 | $16,220 | $17,719 | $15,441 | $51,088 | $42,639 |
| Average total assets | $4,043,516 | $3,928,087 | $3,842,368 | $3,746,608 | $3,636,887 | $3,938,726 | $3,585,868 |
ADJUSTED NET INTEREST MARGIN
“Adjusted Net Interest Margin” is a non-GAAP measure representing net interest income excluding the fees in lieu of interest and other recurring, but volatile, components of net interest margin divided by average interest-earning assets less other recurring, but volatile, components of average interest-earning assets. Fees in lieu of interest are defined as prepayment fees, asset-based loan fees, non-accrual interest, and loan fee amortization. In the judgment of the Company’s management, the adjustments made to net interest income allow investors and analysts to better assess the Company’s net interest income in relation to its core client-facing loan and deposit rate changes by removing the volatility that is associated with these recurring but volatile components. The information provided below reconciles the net interest margin to its most comparable GAAP measure.
| (Unaudited) | For the Three Months Ended | For the Nine Months Ended | |||||
|---|---|---|---|---|---|---|---|
| (Dollars in thousands) | September 30,<br>2025 | June 30,<br>2025 | March 31,<br>2025 | December 31,<br>2024 | September 30,<br>2024 | September 30,<br>2025 | September 30,<br>2024 |
| Interest income | $63,746 | $61,282 | $59,530 | $60,110 | $59,327 | $184,558 | $173,020 |
| Interest expense | 28,860 | 27,498 | 26,272 | 26,962 | 28,320 | 82,630 | 81,961 |
| Net interest income (a) | 34,886 | 33,784 | 33,258 | 33,148 | 31,007 | 101,928 | 91,059 |
| Less: | |||||||
| Fees in lieu of interest | 2,155 | 1,673 | 2,052 | 2,359 | 1,002 | 5,880 | 3,157 |
| FRB interest income and FHLB dividend income | 1,229 | 874 | 848 | 1,062 | 841 | 2,950 | 3,235 |
| Adjusted net interest income (b) | $31,502 | $31,237 | $30,358 | $29,727 | $29,164 | $93,098 | $84,667 |
| Average interest-earning assets (c) | $3,794,490 | $3,686,039 | $3,602,292 | $3,516,390 | $3,405,534 | $3,694,977 | $3,349,299 |
| Less: | |||||||
| Average FRB cash and FHLB stock | 99,796 | 65,212 | 63,971 | 76,576 | 52,603 | 76,457 | 70,175 |
| Average non-accrual loans and leases | 29,796 | 24,833 | 27,228 | 19,077 | 18,954 | 27,295 | 19,761 |
| Adjusted average interest-earning assets (d) | $3,664,898 | $3,595,994 | $3,511,093 | $3,420,737 | $3,333,977 | $3,591,225 | $3,259,363 |
| Net interest margin (a / c) | 3.68% | 3.67% | 3.69% | 3.77% | 3.64% | 3.68% | 3.62% |
| Adjusted net interest margin (b / d) | 3.44% | 3.47% | 3.46% | 3.48% | 3.50% | 3.46% | 3.46% |
NASDAQ: FBIZ Earnings Release Supplement Third Quarter 2025
When used in this presentation, and in any other oral statements made with the approval of an authorized executive officer, the words or phrases “may,” “could,” “should,” “hope,” “might,” “believe,” “expect,” “plan,” “assume,” “intend,” “estimate,” “anticipate,” “project,” “likely,” or similar expressions are intended to identify “forward‐looking statements” within the meaning of such term in the Private Securities Litigation Reform Act of 1995. Such statements are subject to risks and uncertainties, including among other things: (i) Adverse changes in the economy or business conditions, either nationally or in our markets, including, without limitation, inflation, economic downturn, labor shortages, wage pressures, and the adverse effects of public health events on the global, national, and local economy; (ii) Uncertainty created by potential federal government actions relating to the authority of regulatory agencies (including bank regulators), international trade policy, prolonged shutdown of the federal government, and other significant matters;(iii) Competitive pressures among depository and other financial institutions nationally and in our markets; (iv) Increases in defaults by borrowers and other delinquencies; (v) Our ability to manage growth effectively, including the successful expansion of our client support, administrative infrastructure, and internal management systems; (vi) Fluctuations in interest rates and market prices; (vii) Changes in legislative or regulatory requirements applicable to us and our subsidiaries; (viii) Changes in tax requirements, including tax rate changes, new tax laws, and revised tax law interpretations; (ix) Fraud, including client and system failure or breaches of our network security, including our internet banking activities; (x) Failure to comply with the applicable SBA regulations in order to maintain the eligibility of the guaranteed portions of SBA loans. (xi) Ongoing volatility in the banking sector may result in new legislation, regulations or policy changes that could subject the Corporation and the Bank to increased government regulation and supervision, (xii) the proportion of the Corporation’s deposit account balances that exceed FDIC insurance limits may expose the Bank to enhanced liquidity risk, and (xiii) The Corporation may be subject to increases in FDIC insurance assessments. These risks could cause actual results to differ materially from what FBIZ has anticipated or projected. These risks could cause actual results to differ materially from what we have anticipated or projected. These risk factors and uncertainties should be carefully considered by our shareholders and potential investors. For further information about the factors that could affect the Corporation’s future results, please see the Corporation’s annual report on Form 10‐K for the year ended December 31, 2024 and other filings with the Securities and Exchange Commission. Investors should not place undue reliance on any such forward‐looking statement, which speaks only as of the date on which it was made. The factors described within the filings could affect our financial performance and could cause actual results for future periods to differ materially from any opinions or statements expressed with respect to future periods. Where any such forward‐looking statement includes a statement of the assumptions or bases underlying such forward‐looking statement, FBIZ cautions that, while its management believes such assumptions or bases are reasonable and are made in good faith, assumed facts or bases can vary from actual results, and the differences between assumed facts or bases and actual results can be material, depending on the circumstances. Where, in any forward‐looking statement, an expectation or belief is expressed as to future results, such expectation or belief is expressed in good faith and believed to have a reasonable basis, but there can be no assurance that the statement of expectation or belief will be achieved or accomplished. FBIZ does not intend to, and specifically disclaims any obligation to, update any forward‐looking statements. Forward-Looking Statements
Highlights Q3 2025 PTPP Earnings +20% YTD Continued loan and deposit growth and record fee income drove 20% growth in pre-tax, pre-provision earnings and 25% growth in net income for the first nine months of 2025 compared to the prior-year period. AUM&A +12% Private Wealth Management assets under management and administration grew to a record $3.814 billion. PWM fee income totaled $3.7 million for Q3 2025, up 13.0% over Q3 2024. Core Deposits +9% Consistent loan growth across the Company. Loans grew 10.4% annualized from the linked quarter and 9.4% from Q3 2024. Loans +10% Core deposits grew 9.3% annualized from the linked quarter and 8.8% from Q3 2024. Core deposit funding mix improved to 73.1% from 71.8% in the linked quarter NIM 3.68% Match-funding strategy and pricing discipline produced a strong and stable net interest margin of 3.68%, compared to 3.67% for the linked quarter and 3.64% for the prior-year quarter. TBVPS +17% Tangible book value per share grew 16.8% annualized from the linked quarter and 15.6% from Q3 2024. Revenue +16% Operating revenue increased 16.3% from Q3 2024. YTD operating revenue increased 12.3% over the first nine months of 2024.
Relationship Banking Key to Success Deposit‐centric sales strategy led by treasury management sales teams located in all bank markets with direct production and outside calling goals Bankers trained and incented to fund their loan production with deposit growth goals Goal is 10% annual deposit and loan growth Niche lending businesses provide support in a weaker economy (asset-based lending & accounts receivable financing are counter-cyclical) core deposit growth supports loan growth +9% LQA +9% YOY +10% LQA +9% YOY
Diversified Lending Growth Continuing To Grow Higher-Yielding C&I PORTFOLIO 3-Year Loan CAGR C&I = 17% CRE & Other = 11%
Strong and Stable Net Interest Margin FILOI defined as fees in lieu of interest which includes prepayment fees, asset-based loan fees, non-accrual interest, late fees, and loan fee amortization Wholesale funding defined as brokered CDs and non‐reciprocal interest‐bearing transaction accounts plus FHLB advances. 3. Note: Peer group defined as publicly‐traded bank with total assets between $1.75 billion and $7 billion. Peer data not yet available for 3Q25. MATCH FUNDING STRATEGY SUPPORTS RESILIENT NIM
Disciplined Interest Rate Risk Management FLOATING RATE PORTFOLIO Floating portfolio is predominantly indexed to SOFR, which aligns with the Bank’s SOFR‐indexed and managed rate non‐maturity deposit portfolio. 58% of portfolio as of 9/30/25: METHODICAL APPROACH Generally individually match‐fund loans with maturities over 5 years and amounts greater than $5MM. Portfolio match‐funding in various terms against the fixed‐rate loan portfolio with maturities under 5 years and amounts less than $5MM. ~$10‐$25 million of monthly wholesale funding maturities to effectively manage the liquidity requirements of the match‐funding strategy. Loans Deposits SOFR: $1.516 B SOFR: $733 MM Prime: $417 MM Managed rate, non‐maturity: $1.157 B TOTAL = $1.933 B TOTAL = $1.890 B FIXED RATE PORTFOLIO Wholesale funding used to match maturities and cash flows on long‐term fixed rate loans. This locks in interest rate spread and maintains greater stability in net interest margin. 42% of portfolio as of 9/30/25
Operating Revenue Highlights Continued strong revenue supported by: Robust loan and deposit growth Strong and stable net interest margin Diverse sources of non‐interest income, including service fees from our Private Wealth Management business, which comprised 45% of YTD total non‐interest income Strategic investments drive growth while maintaining positive long‐term operating leverage 1. Operating Revenue and Adjusted Net Interest Income are non-GAAP measurements. Refer to the non-GAAP reconciliation schedule section of the Company’s Q3 earnings release.. 2."Fees in Lieu of Interest" is defined as prepayment fees, asset-based loan fees, non-accrual interest, late fees, and loan fee amortization. Balanced and Steady Growth DIVERSIFIED REVENUE SOURCES 2 Operating Revenue1 +16% YOY Note: Net interest income is the sum of "Adjusted Net Interest Income", “Other Interest Income”, and "Fees in Lieu of Interest". Non-interest income is the sum of "Private Wealth Management Service Fees", "Other Fee Income", "Service Charges on Deposits", "SBA Gains", “Loan Fees” and "Swap Fees". 1
Solid Asset Quality NON-PERFORMING ASSETS REMAIN WELL MANAGED For more detailed definitions of credit quality categories, see the Company’s Annual Report on Form 10-K filed with the SEC on February 26, 2025. As of 9/30/25, 93% of the loan portfolio was classified in category I(1) and 99% of loans were current
Robust Liquidity with Stable Deposit Base Stable Core Deposit Base Substantial Liquidity Source 9/30/2025 9/30/2024 Short-term investments $8,074 $86,670 Collateral value of unencumbered pledged loans 906,042 397,852 Market value of unencumbered securities 376,783 279,191 Readily accessible liquidity $1,290,899 $763,713 Fed fund lines 45,000 45,000 Excess brokered CD capacity (1) 732,951 1,102,767 Total liquidity $2,068,850 $1,911,480 1. Bank internal policy limits brokered CDs to 50% of total bank funding when combined with FHLB advances. Dollars in thousands Category 9/30/2025 9/30/2024 Uninsured deposits $1,100,868 $1,008,496 Collateralized public funds 72,561 10,755 FDIC insured deposits 2,159,642 1,870,696 Total deposits $3,333,071 $2,969,947 Percent insured or collateralized 69% 64%
Robust Capital Base Strong Capital Ratios (%) +17% LQ +16% YOY STRONG EARNINGS GENERATE CAPITAL FOR GROWTH 1. “Tangible Book Value Per Share" is a non‐GAAP measurement. Refer to the non-GAAP reconciliation schedule section of the Company’s Q3 earnings release.
Deliver above-average total shareholder return compared to peer median September 2025 YTD metrics reflect YTD growth compared to September 2024 YTD ROATCE and TBV/share are non-GAAP measurements. Refer to the non-GAAP reconciliation schedule of the Company’s Q3 earnings release for additional detail. Represents data from the 2024 employee engagement survey. Net promoter score assesses likelihood to recommend on an 11‐point scale, where detractors (scores 0‐6) are subtracted from promoters (scores 9‐10), while passives (scores 7‐8) are not considered. See appendix for additional information on the source of the net promoter score. Represents data from the 2024 survey. Goals & Progress STRATEGIC PLAN 2024-2028 Goals 2024‐2028 2024 Sept 25 YTD ROATCE1 ≥15% by 2028 15.4% 17.3% TBV Growth1 ≥10% per year 15.0% 15.6% Revenue Growth ≥10% per year 6.6% 12.3% Efficiency Ratio <60% by 2028 60.61% 59.51% Core Deposits to Total Funding ≥75% 71% 73% Employee Engagement & Participation2 ≥85% 86% 86% Net Promoter Score3 ≥70 70 70