FIRST BUSINESS FINANCIAL SERVICES, INC.

Previous wording

Results as of and for the three and six months ended June 30, 2026 include:

Current wording

Results as of and for the three and nine months ended September 30, 2026 include:

Previous wording

Net income available to common shareholders totaled $15.4 million, or diluted earnings per share of $1.84, for the three months ended June 30, 2026, compared to $11.2 million, or diluted earnings per share of $1.35, for the same period in 2025. Net income available to common shareholders totaled $27.3 million, or diluted earnings per share of $3.28, for the six months ended June 30, 2026, compared to $22.2 million, or diluted earnings per share $2.66, for the same period in 2025.

Current wording

Net income available to common shareholders totaled $16.4 million, or diluted earnings per share of $1.95, for the three months ended September 30, 2026, compared to $14.2 million, or diluted earnings per share of $1.70, for the same period in 2025. Net income available to common shareholders totaled $43.7 million, or diluted earnings per share of $5.24, for the nine months ended September 30, 2026, compared to $36.3 million, or diluted earnings per share of $4.37, for the same period in 2025.

Previous wording

Annualized return on average assets (“ROAA”) for the three months ended June 30, 2026 measured 1.43%, compared to 1.14% for the same period in 2025. ROAA for the six months ended June 30, 2026 measured 1.28%, compared to 1.14% for the same period in 2025.

Current wording

Annualized return on average assets (“ROAA”) for the three months ended September 30, 2026 measured 1.49%, compared to 1.40% for the same period in 2025. ROAA for the nine months ended September 30, 2026 measured 1.35%, compared to 1.23% for the same period in 2025.

Previous wording

Return on average tangible common equity (“ROATCE”) is defined as net income available to common shareholders divided by average equity less average intangible assets and average preferred stock. ROATCE was 16.89% for the three months ended June 30, 2026, compared to 14.17% for the same period in 2025. ROATCE was 15.25% for the six months ended June 30, 2026, compared to 14.15% for the same period in 2025.

Current wording

Return on average tangible common equity (“ROATCE”), a non-GAAP measure, defined as net income available to common shareholders divided by average equity less average intangible assets and average preferred stock. ROATCE was 17.32% for the three months ended September 30, 2026, compared to 17.29% for the same period in 2025. ROATCE was 15.96% for the nine months ended September 30, 2026, compared to 15.23% for the same period in 2025. Return on average equity ("ROAE") was 16.29% for the three months ended September 30, 2026, compared to 16.11% for the same period in 2025. ROAE for the nine months ended September 30, 2026 was 14.98%, compared to 14.16% for the same period in 2025.

Previous wording

Pre-tax, pre-provision (“PTPP”) adjusted earnings, which excludes certain one-time and discrete items, for the three months ended June 30, 2026 was $19.8 million, compared to $16.0 million in the same period in 2025. PTPP for the six months ended June 30, 2026 was $37.0 million, compared to $32.2 million in the same period in 2025.

Current wording

Pre-tax, pre-provision (“PTPP”) adjusted earnings is a non-GAAP measure defined as operating revenue less operating expense, which excludes certain one-time and discrete items, for the three months ended September 30, 2026 was $21.3 million, compared to $18.9 million in the same period in 2025. PTPP for the nine months ended September 30, 2026 was $58.4 million, compared to $51.1 million in the same period in 2025.

Previous wording

Net interest margin was 3.78% for the three months ended June 30, 2026, compared to 3.67% for the same period in 2025. Net interest margin was 3.67% for the six months ended June 30, 2026, compared to 3.68% for the same period in 2025.

Current wording

Net interest margin was 3.80% for the three months ended September 30, 2026, compared to 3.68% for the same period in 2025. Net interest margin was 3.72% for the nine months ended September 30, 2026, compared to 3.68% for the same period in 2025.

Previous wording

Top line revenue, defined as net interest income plus non-interest income, totaled $46.7 million for the three months ended June 30, 2026, compared to $41.0 million in the same period in 2025. Top line revenue totaled $91.0 million for the six months ended June 30, 2026, compared to $81.9 million in the same period in 2025.

Current wording

Top line revenue, defined as net interest income plus non-interest income, totaled $47.5 million for the three months ended September 30, 2026, compared to $44.5 million in the same period in 2025. Top line revenue totaled $138.5 million for the nine months ended September 30, 2026, compared to $126.4 million in the same period in 2025.

Previous wording

Effective tax rate, including the benefit from Low-Income Housing Tax Credits, was 10.89% for the six months ended June 30, 2026 compared to 15.79% for the same period in 2025. Income tax expense for the three and six months ended June 30, 2026 included a $1.5 million release of the remaining state deferred tax valuation allowance.

Current wording

Effective tax rate, including the benefit from Low-Income Housing Tax Credits, was 12.41% for the nine months ended September 30, 2026 compared to 16.35% for the same period in 2025. Income tax expense for the nine months ended September 30, 2026 included a $1.5 million release of the remaining state deferred tax valuation allowance.

Previous wording

Provision for credit losses was $2.1 million for the three months ended June 30, 2026, compared to $2.7 million for the same period in 2025. Provision for credit losses was $5.0 million for the six months ended June 30, 2026, compared to $5.4 million for the same period in 2025.

Current wording

Provision for credit losses was $1.9 million for the three months ended September 30, 2026, compared to $1.4 million for the same period in 2025. Provision for credit losses was $7.0 million for the nine months ended September 30, 2026, compared to $6.8 million for the same period in 2025.

Previous wording

Total assets at June 30, 2026 increased $328.1 million, or 8.0%, to $4.410 billion from $4.082 billion at December 31, 2025.

Current wording

Total assets at September 30, 2026 increased $362.4 million, or 8.9%, to $4.444 billion from $4.082 billion at December 31, 2025.

Previous wording

Period-end gross loans and leases receivable increased $213.1 million, or 12.6% annualized, to $3.588 billion as of June 30, 2026 compared to $3.375 billion as of December 31, 2025. Average gross loans and leases of $3.488 billion increased $275.5 million, or 8.6%, for the six months ended June 30, 2026, compared to $3.213 billion for the same period in 2025.

Current wording

Period-end gross loans and leases receivable increased $301.7 million, or 11.9% annualized, to $3.677 billion as of September 30, 2026 compared to $3.375 billion as of December 31, 2025. Average gross loans and leases of $3.532 billion increased $290.6 million, or 9.0%, for the nine months ended September 30, 2026, compared to $3.241 billion for the same period in 2025.

Previous wording

Non-performing assets were $38.1 million and 0.86% of total assets as of June 30, 2026, compared to $43.9 million and 1.07% of total assets as of December 31, 2025.

Current wording

Non-performing assets were $40.2 million and 0.91% of total assets as of September 30, 2026, compared to $43.9 million and 1.07% of total assets as of December 31, 2025.

Previous wording

The allowance for credit losses, including reserve for unfunded credit commitments, increased $1.8 million compared to December 31, 2025. The allowance for credit losses, including reserve for unfunded credit commitments, was 1.10% of total loans, compared to 1.12% at December 31, 2025.

Current wording

The allowance for credit losses, including reserve for unfunded credit commitments, increased $1.2 million compared to December 31, 2025. The allowance for credit losses, including reserve for unfunded credit commitments, was 1.06% of total loans, compared to 1.12% at December 31, 2025.

Previous wording

Period-end core deposits at June 30, 2026 increased $204.7 million, or 15.3% annualized, to $2.878 billion from $2.673 billion as of December 31, 2025. Average core deposits of $2.854 billion increased $474.6 million or 19.9%, for the six months ended June 30, 2026, compared to $2.380 billion for the same period in 2025.

Current wording

Period-end core deposits at September 30, 2026 increased $306.0 million, or 15.3% annualized, to $2.979 billion from $2.673 billion as of December 31, 2025. Average core deposits of $2.884 billion increased $431.0 million, or 17.6%, for the nine months ended September 30, 2026, compared to $2.453 billion for the same period in 2025.

Previous wording

Private wealth and trust assets under management and administration increased by $419.9 million, or 22.0% annualized, to $4.235 billion at June 30, 2026, compared to $3.815 billion at December 31, 2025. Private wealth and trust assets under management and administration increased $503.9 million, or 13.5%, compared to June 30, 2025.

Current wording

Private wealth and trust assets under management and administration increased by $412.1 million, or 14.2% annualized, to $4.227 billion at September 30, 2026, compared to $3.815 billion at December 31, 2025. Private wealth and trust assets under management and administration increased $413.0 million, or 10.8%, compared to September 30, 2025.

Previous wording

Top line revenue, comprised of net interest income and non-interest income, increased $5.7 million, or 13.8%, for the three months ended June 30, 2026, compared to the same period in 2025, due to a 12.9% increase in net interest income and an 18.1% increase in non-interest income. The increase in net interest income was primarily driven by increases in average loans and leases outstanding and prepayment fees, partially offset by lower short-term market rates. The increase in non-interest income was due primarily to increases in income from limited partnership investment income, private wealth income, and service charges on deposits, partially offset by decreases in gains on sale of SBA loans due to the exit from the out of market SBA 7(a) lending activities in the current quarter.

Current wording

Top line revenue, comprised of net interest income and non-interest income, increased $3.0 million, or 6.7%, for the three months ended September 30, 2026, compared to the same period in 2025, due to a 12.0% increase in net interest income partially offset by a 12.6% decrease in non-interest income. The increase in net interest income was primarily driven by increases in average loans and leases outstanding, asset-based loan fees, and prepayment fees. The decrease in non-interest income was due primarily to decreases in income from limited partnership investment income, nonrecurring fee income in accounts receivable financing, commercial loan swap fees, and gains on sale of SBA loans due to the exit from the out of market SBA 7(a) lending activities in the prior quarter, partially offset by increases in private wealth income, credit card fees, and service charges on deposits.

Previous wording

Top line revenue increased $9.1 million, or 11.1%, for the six months ended June 30, 2026, compared to the same period in 2025, due to a 9.9% increase in net interest income and a 16.9% increase in non-interest income. The increase in net interest income was primarily driven by increases in average loans and leases outstanding and prepayment fees, partially offset by lower short-term market rates. The increase in non-interest income was due primarily to increases in private wealth income, income from limited partnership investments, commercial loan swap income, service charges on deposits, and bank-owned life insurance income, partially offset by decreases in gains on sale of SBA loans as noted above.

Current wording

Top line revenue increased $12.1 million, or 9.6%, for the nine months ended September 30, 2026, compared to the same period in 2025, due to a 10.6% increase in net interest income and a 5.3% increase in non-interest income. The increase in net interest income was primarily driven by increases in average loans and leases outstanding, asset-based loan fees, and prepayment fees. The increase in non-interest income was due primarily to increases in private wealth income, service charges on deposits, credit card fees, and bank-owned life insurance income, partially offset by decreases in income from limited partnership investments, nonrecurring fee income in accounts receivable financing, and gains on sale of SBA loans as noted above.

Previous wording

ROAA for the three and six months ended June 30, 2026 was 1.43% and 1.28%, respectively, compared to 1.14% for both the three and six months ended June 30, 2025. The increase in ROAA was due to an increase in pre-tax, pre-provision earnings driven by average loan growth, stable margin, and strong fee income, as well as a $1.5 million income tax benefit. Excluding the income tax benefit, ROAA was 1.29% and 1.21% for the three and six months ended June 30, 2026, respectively. We consider ROAA a critical metric to measure the profitability of our organization and how efficiently our assets are deployed. ROAA also allows us to better benchmark our profitability to our peers without the need to consider different degrees of leverage which can ultimately influence return on equity measures.

Current wording

ROAA for the three and nine months ended September 30, 2026 was 1.49% and 1.35%, respectively, compared to 1.40% and 1.23% for the three and nine months ended September 30, 2025, respectively. The increase in ROAA for the three months ended was due to an increase in net income driven by average loan growth, net interest margin improvement, and lower operating expenses. The increase in ROAA for the nine months ended was due to an increase in net income driven by average loan growth and strong fee income. The nine months ended September 30, 2026 includes a $1.5 million income tax benefit. Excluding the income tax benefit, ROAA was 1.30% for the nine months ended September 30, 2026. We consider ROAA a critical metric to measure the profitability of our organization and how efficiently our assets are deployed. ROAA also allows us to better benchmark our profitability to our peers without the need to consider different degrees of leverage which can ultimately influence return on equity measures.

Previous wording

ROATCE for the three and six months ended June 30, 2026 was 16.9% and 15.2%, respectively, compared to 14.2% for both the three and six months ended June 30, 2025. The explanation of the increase in ROATCE is consistent with the ROAA discussion above. Excluding the income tax benefit, ROATCE was 15.3% and 14.4% for the three and six months ended June 30, 2026, respectively. We view ROATCE as an important measurement for monitoring profitability and continue to focus on improving our return to our shareholders by enhancing the overall profitability of our client relationships, controlling our expenses, and minimizing our costs of credit.

Current wording

ROATCE, a non-GAAP measure defined as the ratio of net income available to common shareholders divided by average tangible common equity, for the three and nine months ended September 30, 2026 was 17.3% and 16.0%, respectively, compared to 17.3% and 15.2% for the three and nine months ended September 30, 2025, respectively. The explanation of the increase in ROATCE is consistent with the ROAA discussion above. Excluding the income tax benefit, ROATCE was 15.4% for the nine months ended September 30, 2026. We view ROATCE as an important measurement for monitoring profitability and continue to focus on improving our return to our shareholders by enhancing the overall profitability of our client relationships, controlling our expenses, and minimizing our costs of credit.

Previous wording

Efficiency ratio measured 57.6% and 59.3% for the three and six months ended June 30, 2026, respectively, compared to 61.0% and 60.6% for the three and six months ended June 30, 2025, respectively. The decrease in efficiency ratio was primarily due to a volume-driven increase in net interest income and an increase in non-interest income, partially offset by an increase in compensation expense. Efficiency ratio is a non-GAAP measure representing operating expense, which is non-interest expense excluding the effects of the SBA recourse benefit or provision, net gains or losses 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 net gains or losses on securities, if any.

Current wording

Efficiency ratio measured 55.1% and 57.9% for the three and nine months ended September 30, 2026, respectively, compared to 57.4% and 59.5% for the three and nine months ended September 30, 2025, respectively. The decrease in efficiency ratio was primarily due to lower SBA-related compensation expense. Efficiency ratio is a non-GAAP measure representing operating expense, which is non-interest expense excluding the effects of the SBA recourse benefit or provision, net gains or losses 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 net gains or losses on securities, if any.

Previous wording

PTPP adjusted earnings for the three and six months ended June 30, 2026 were $19.8 million and $37.0 million, respectively, compared to $16.0 million and $32.2 million for the three and six months ended June 30, 2025, respectively. The increase in PTPP adjusted earnings is primarily due to an increase in net interest income and non-interest income and improved efficiency. This increase in total revenue was partially offset by an increase in non-interest expense primarily due to an increase in compensation expense. In the judgment of the Corporation’s management, the adjustments made to non-interest expense and non-interest income allow investors and analysts to better assess the Corporation’s operating expenses in relation to its core operating revenue by removing the volatility associated with certain one-time items and other discrete items. PTPP adjusted earnings is a non-GAAP measure that allows management to benchmark performance of our model to our peers without the influence of the provision for credit losses and tax considerations, which will ultimately influence other traditional financial measures, including ROAA and ROATCE. The information provided below reconciles the efficiency ratio to its most comparable GAAP measure.

Current wording

PTPP adjusted earnings for the three and nine months ended September 30, 2026 were $21.3 million and $58.4 million, respectively, compared to $18.9 million and $51.1 million for the three and nine months ended September 30, 2025, respectively. The increase in PTPP adjusted earnings is primarily due to an increase in net interest income and improved operating efficiency. PTPP adjusted earnings is a non-GAAP measure that allows management to benchmark performance of our model to our peers without the influence of the provision for credit losses and tax considerations, which will ultimately influence other traditional financial measures, including ROAA and ROATCE. In the judgment of the Corporation’s management, the adjustments made to non-interest expense and non-interest income allow investors and analysts to better assess the Corporation’s operating expenses in relation to its core operating revenue by removing the volatility associated with certain one-time items and other discrete items. The information provided below reconciles the efficiency ratio to its most comparable GAAP measure.

Previous wording

The following table provides information with respect to (1) the change in net interest income attributable to changes in rate (changes in rate multiplied by prior volume) and (2) the change in net interest income attributable to changes in volume (changes in volume multiplied by prior rate) for the three and six months ended June 30, 2026 compared to the same period in 2025. The change in net interest income attributable to changes in rate and volume (changes in rate multiplied by changes in volume) has been allocated to the rate and volume changes in proportion to the relationship of the absolute dollar amounts of the change in each.

Current wording

The following table provides information with respect to (1) the change in net interest income attributable to changes in rate (changes in rate multiplied by prior volume) and (2) the change in net interest income attributable to changes in volume (changes in volume multiplied by prior rate) for the three and nine months ended September 30, 2026 compared to the same period in 2025. The change in net interest income attributable to changes in rate and volume (changes in rate multiplied by changes in volume) has been allocated to the rate and volume changes in proportion to the relationship of the absolute dollar amounts of the change in each.

Previous wording

The table below shows our average balances, interest, average yields/rates, net interest margin, and the spread between the combined average yields earned on interest-earning assets and average rates on interest-bearing liabilities for the three and six months ended June 30, 2026 and 2025. The average balances are derived from average daily balances.

Current wording

The table below shows our average balances, interest, average yields/rates, net interest margin, and the spread between the combined average yields earned on interest-earning assets and average rates on interest-bearing liabilities for the three and nine months ended September 30, 2026 and 2025. The average balances are derived from average daily balances.

Previous wording

The change in yield of the respective interest-earning assets or the rate paid on interest-bearing liability compared to the change in short-term market rates is commonly referred to as a beta. The table below displays the beta calculations for loans and leases, total interest earning assets, core deposits, interest-bearing deposits and total interest-bearing liabilities for the three and six months ended June 30, 2026 and 2025.

Current wording

The change in yield of the respective interest-earning assets or the rate paid on interest-bearing liability compared to the change in short-term market rates is commonly referred to as a beta. The table below displays the beta calculations for loans and leases, total interest earning assets, core deposits, interest-bearing deposits and total interest-bearing liabilities for the three and nine months ended September 30, 2026 and 2025.

Previous wording

Comparison of Net Interest Income for the Three and Six Months Ended June 30, 2026 and 2025

Current wording

Comparison of Net Interest Income for the Three and Nine Months Ended September 30, 2026 and 2025

Previous wording

Net interest income increased $4.4 million, or 12.9%, and $6.6 million, or 9.9%, respectively, during the three and six months ended June 30, 2026, compared to the three and six months ended June 30, 2025. The increase in net interest income primarily reflected increases in average gross loans and leases outstanding and in prepayment fees of $706,000 and $280,000, respectively, during the three and six months ended June 30, 2026. Average gross loans and leases for the three and six months ended June 30, 2026 increased $310.6 million, or 9.6%, and $275.5 million, or 8.6%, respectively, compared to the three and six months ended June 30, 2025.

Current wording

Net interest income increased $4.2 million, or 12.0%, and $10.8 million, or 10.6%, respectively, during the three and nine months ended September 30, 2026, compared to the three and nine months ended September 30, 2025. The increase in net interest income primarily reflected increases in average gross loans and leases outstanding, prepayment fees of $450,000 and $730,000, and asset-based loan fees of $407,000 and $1.0 million, respectively, during the three and nine months ended September 30, 2026. Average gross loans and leases for the three and nine months ended September 30, 2026 increased $320.5 million, or 9.7%, and $290.6 million, or 9.0%, respectively, compared to the three and nine months ended September 30, 2025.

Previous wording

The yield on average interest-earning assets for the three and six months ended June 30, 2026 was 6.45% and 6.33%, respectively, compared to 6.65% and 6.63%, respectively, for the three and six months ended June 30, 2025. The decrease in yield was primarily due to the decrease in short-term market rates.

Current wording

The yield on average interest-earning assets for the three and nine months ended September 30, 2026 was 6.47% and 6.38%, respectively, compared to 6.72% and 6.66%, respectively, for the three and nine months ended September 30, 2025. The decrease in yield was primarily due to the decrease in short-term market rates, partially offset by an increase in prepayment fees and asset-based loan fees.

Previous wording

The average rate paid on total interest-bearing liabilities was 3.14% for both the three and six months ended June 30, 2026, compared to 3.55% and 3.52% for the three and six months ended June 30, 2025, respectively. Total interest-bearing liabilities includes interest-bearing deposits, FHLB advances, subordinated and junior subordinated notes and debentures payable, federal funds purchased, and other borrowings. The average rates paid decreased due to lower short-term interest rates.

Current wording

The average rate paid on total interest-bearing liabilities was 3.19% and 3.16% for the three and nine months ended September 30, 2026, respectively, compared to 3.61% and 3.55% for the three and nine months ended September 30, 2025, respectively. Total interest-bearing liabilities includes interest-bearing deposits, FHLB advances, subordinated and junior subordinated notes and debentures payable, federal funds purchased, and other borrowings. The average rates paid decreased due to lower short-term interest rates.

Previous wording

The Corporation maintains a target for net interest margin in the range of 3.60% - 3.65%. Performance in future periods 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.

Current wording

The Corporation maintains a long-term target for net interest margin in the range of 3.60% to 3.65%. Performance in future periods 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.

Previous wording

The following table shows the components of the provision for credit losses for the three and six months ended June 30, 2026 compared to the same period in 2025.

Current wording

The following table shows the components of the provision for credit losses for the three and nine months ended September 30, 2026 compared to the same period in 2025.

Previous wording

Non-interest income for the three months ended June 30, 2026 increased $1.3 million, or 18.1%, to $8.6 million compared to $7.3 million for the same period in 2025. The increase in total non-interest income for the three months ended was primarily driven by higher returns on limited partnership investments, private wealth fee income, service charges on deposits, and bank-owned life insurance income, partially offset by a decrease in gains on sale of SBA loans due to the exit from the out of market SBA 7(a) lending activities in the current quarter. The increase in total non-interest income for the six months ended was primarily driven by increases in commercial loan swap fees, private wealth fee income, bank-owned life insurance income, higher returns on limited partnership investments and service charges on deposits, partially offset by a decrease in gains on sale of SBA loans due to the exit from the out of market SBA 7(a) lending activities in the current quarter. Non-interest income for the six months ended June 30, 2026 increased $2.5 million, or 16.9%, to $17.3 million compared to $14.8 million for the same period in 2025.

Current wording

Non-interest income for the three months ended September 30, 2026 decreased $1.2 million, or 12.6%, to $8.4 million compared to $9.6 million for the same period in 2025. The decrease in total non-interest income for the three months ended September 30, 2026 was primarily driven by lower returns on limited partnership investments, nonrecurring prior year fee income in accounts receivable financing, commercial loan swap fees, lower gains on sale of SBA loans due to the exit from the out of market SBA 7(a) lending activities in the current year, and bank-owned life insurance income, partially offset by an increase in private wealth fee income, credit card fees, and service charges on deposits. The increase in total non-interest income for the nine months ended was primarily driven by increases in private wealth fee income, service charges on deposits, credit card fees, and bank-owned life insurance income, partially offset by a decrease in gains on sale of SBA loans due to the exit from the out of market SBA 7(a) lending activities in the prior quarter, lower returns on limited partnership investments, and nonrecurring prior year fee income in accounts receivable financing. Non-interest income for the nine months ended September 30, 2026 increased $1.3 million, or 5.3%, to $25.8 million compared to $24.5 million for the same period in 2025.

Previous wording

Management continues to focus on revenue growth from multiple non-interest income sources to maintain a diversified revenue stream. Contribution from fee-based revenue sources can be variable and driven by changes in the interest rate environment, client activity, and the value of underlying investments. Total non-interest income accounted for 18.3% and 19.1% of total revenues for the three and six months ended June 30, 2026, respectively, compared to 17.7% and 18.1% for the three and six months ended June 30, 2025, respectively.

Current wording

Management continues to focus on revenue growth from multiple non-interest income sources to maintain a diversified revenue stream. Contribution from fee-based revenue sources can be variable and driven by changes in the interest rate environment, client activity, and the value of underlying investments. Total non-interest income accounted for 17.7% and 18.6% of total revenues for the three and nine months ended September 30, 2026, respectively, compared to 21.7% and 19.4% for the three and nine months ended September 30, 2025, respectively.

Previous wording

Private wealth fee income increased $509,000, or 13.6%, and $894,000, or 12.3%, for the three and six months ended June 30, 2026, respectively, compared to the same period in 2025. Private wealth fee income was up compared to the prior year primarily due to an increase in assets under management and administration. Private wealth fee income can vary due to the mix of business at different fee structures and can be positively or negatively influenced by the timing and magnitude of volatility in the capital markets. As of June 30, 2026, private wealth and trust assets under management and administration increased $503.9 million, or 13.5%, totaling $4.235 billion compared to $3.731 billion as of June 30, 2025, due to an increase in market values, new clients, and new money from existing clients.

Current wording

Private wealth fee income increased $488,000, or 13.2%, and $1.4 million, or 12.6%, for the three and nine months ended September 30, 2026, respectively, compared to the same period in 2025. Private wealth fee income is primarily based on asset levels and may vary based on seasonal activity and the timing of fluctuations in market values. As of September 30, 2026, private wealth and trust assets under management and administration increased $413.0 million, or 10.8%, totaling $4.227 billion compared to $3.814 billion as of September 30, 2025, primarily due to an increase in market values, new clients, and new money from existing clients.

Previous wording

Service charges on deposits increased $233,000, or 21.1%, and $501,000, or 23.3%, for the three and six months ended June 30, 2026, respectively, compared to the same period in 2025. The increase was primarily driven by new and expanded core deposit relationships. Treasury management business development efforts remain robust as gross treasury management service charges increased $281,000, or 16.5%, and $537,000, or 16.0%, for the three and six months ended June 30, 2026, compared to the same period in 2025. Management believes growth in gross analyzed service charges is a strong indicator of success for the Corporation given the direct correlation to adding and expanding core business relationships.

Current wording

Service charges on deposits increased $258,000, or 22.4%, and $760,000, or 23.0%, for the three and nine months ended September 30, 2026, respectively, compared to the same period in 2025. The increase was driven by new and expanded core deposit relationships. Treasury management business development efforts remain robust as gross treasury management service charges increased $276,000, or 15.6%, and $813,000, or 15.9%, for the three and nine months ended September 30, 2026, compared to the same period in 2025. Management believes growth in gross analyzed service charges is a strong indicator of success for the Corporation given the direct correlation to adding and expanding core business relationships.

Previous wording

Gain on sale of SBA loans decreased $397,000, or 100.0%, and $768,000, or 56.5%, for the three and six months ended June 30, 2026, respectively, compared to the same period in 2025. The decrease was due to management's decision to hold for investment any existing and new SBA 7(a) loans.

Current wording

Gain on sale of SBA loans decreased $382,000, or 100.0%, and $1.2 million, or 66.0%, for the three and nine months ended September 30, 2026, respectively, compared to the same period in 2025. The decrease was due to management's decision to hold for investment any existing and new SBA 7(a) loans.

Previous wording

Commercial loan swap fee income decreased $8,000, or 4.7%, and increased $507,000, or 179.2%, for the three and six months ended June 30, 2026, respectively, compared to the same period in 2025. Swap fee income varies period to period based on loan activity and the interest rate environment.

Current wording

Commercial loan swap fee income decreased $419,000, or 43.0%, and increased $88,000, or 7.0%, for the three and nine months ended September 30, 2026, respectively, compared to the same period in 2025. Swap fee income varies period to period based on loan activity and the interest rate environment.

Previous wording

Non-interest expense for the three and six months ended June 30, 2026 increased $2.9 million, or 11.5%, and $5.1 million, or 10.3%, respectively, compared to the same periods in 2025. Operating expense, which excludes certain one-time and discrete items as defined in the Efficiency Ratio and Pre-Tax, Pre-Provision Adjusted Earnings section above, increased $1.9 million, or 7.5%, and $4.3 million, or 8.7%, for the three and six months ended June 30, 2026, respectively, compared to the same periods in 2025. The increase in operating expense was primarily due to an increase in compensation expense.

Current wording

Non-interest expense for the three and nine months ended September 30, 2026 increased $405,000, or 1.6%, and $5.5 million, or 7.3%, respectively, compared to the same periods in 2025. Operating expense, which excludes certain one-time and discrete items as defined in the Efficiency Ratio and Pre-Tax, Pre-Provision Adjusted Earnings section above, increased $746,000, or 2.9%, and $5.1 million, or 6.8%, for the three and nine months ended September 30, 2026, respectively, compared to the same periods in 2025. The increase in operating expense was primarily due to an increase in compensation expense.

Previous wording

Compensation expense for the three and six months ended June 30, 2026 increased $1.9 million, or 11.7%, and $3.7 million, or 11.2%, respectively, compared to the same period in 2025. Growth reflects annual merit increases, promotions, $405,000 of severance expense related to the out of market SBA 7(a) lending exit, and higher annual cash bonus accruals due to improved Company performance. Excluding SBA severance, compensation expense increased $1.5 million, or 9.2%. Average full-time equivalent employees for the three months ended June 30, 2026 decreased to 360, down 1.1%, compared to 364 for the three months ended June 30, 2025. Excluding FTEs in out of market SBA 7(a) lending, average FTEs for the three months ended June 30, 2026 increased to 354, up 2.9%, compared to 344 for the three months ended June 30, 2025.

Current wording

Compensation expense for the three and nine months ended September 30, 2026 increased $327,000, or 1.9%, and $4.0 million, or 8.0%, respectively, compared to the same period in 2025. Growth reflects annual merit increases and promotions as well as higher annual cash bonus accruals reflecting above-target Corporation performance. These increases were partially offset by lower salaries and benefits expense related to the Corporation's strategic exit from out of market SBA 7(a) lending activities. Average full-time equivalent employees for the three months ended September 30, 2026 decreased to 352, or 3.8%, compared to 366 for the three months ended September 30, 2025. Excluding SBA employees from both periods of comparison, average FTEs for the three months ended September 30, 2026 were 351 compared to 345 for the three months ended September 30, 2025.

Previous wording

Computer software expense increased $302,000, or 18.2%, and $620,000, or 19.0%, for the three and six months ended June 30, 2026, respectively, compared to the same period in 2025. The increase was primarily due to our commitment to innovative technology to support growth initiatives, enhance productivity, and improve the client experience.

Current wording

Computer software expense increased $237,000, or 13.0%, and $857,000, or 16.9%, for the three and nine months ended September 30, 2026, respectively, compared to the same period in 2025. The increase was primarily due to the Corporation's commitment to innovative technology to support growth initiatives, enhance productivity, and improve the client experience.

Previous wording

Other non-interest expense for the three and six months ended June 30, 2026 increased $678,000, or 60.1%, and $725,000, or 32.4%, respectively, compared to the same period in 2025. The increase was primarily due to impairment of tax credit investments and an increase in liquidation expense.

Current wording

Other non-interest expense for the three and nine months ended September 30, 2026 decreased $532,000, or 31.6%, and increased $192,000, or 4.9%, respectively, compared to the same period in 2025. The decrease for the three month period was primarily due to a decrease in SBA recourse reserves. The increase for the nine month period was primarily due to additional impairment of historic tax credit investments, increase in liquidation expense, partially offset by a decrease in SBA recourse reserves.