CIVISTA BANCSHARES, INC.

Previous wording

The following discussion reviews the consolidated financial condition of the Company at June 30, 2026 compared to December 31, 2025, and the consolidated results of operations for the three and six months ended June 30, 2026, compared to the same period in 2025. This discussion should be read in conjunction with the Unaudited Consolidated Financial Statements and Notes included in this Quarterly Report on Form 10-Q.

Current wording

The following discussion reviews the consolidated financial condition of the Company at September 30, 2026 compared to December 31, 2025, and the consolidated results of operations for the three and nine months ended September 30, 2026, compared to the same periods in 2025. This discussion should be read in conjunction with the Unaudited Consolidated Financial Statements and Notes included in this Quarterly Report on Form 10-Q.

Previous wording

At the close of business on November 6, 2025, Civista closed its previously announced acquisition of FSB. The acquisition added approximately $268.1 million of total assets, $106.2 million of total loans and leases, $236.1 million of total deposits, and two branches. The 2025 results reflect inclusion of FSB since November 7, 2025.

Current wording

At the close of business on November 6, 2025, Civista closed its previously announced acquisition of FSB. The acquisition added approximately $268,139 of total assets, $106,161 of total loans and leases, $236,097 of total deposits, and two branches. The 2025 results reflect inclusion of FSB since November 7, 2025.

Previous wording

Upon the closing of the acquisition, FSB was merged with and into Civista Bank. In addition, the management and organization structure was updated to reflect the combined organization. On-boarding of former FSB colleagues and their initial training was completed in the first quarter of 2026. Certain of Civista's products and services have been introduced across the legacy FSB customer base, and customer-facing colleagues are focused on both growing and retaining customers. Technology conversions were completed in mid-February 2026, as scheduled.

Current wording

Upon the closing of the acquisition, FSB was merged with and into Civista Bank. In addition, the management and organization structure was updated to reflect the combined organization. On-boarding of former FSB colleagues and their initial training was completed in the first quarter of 2026, and technology conversions were completed in mid-February, as scheduled. Certain of Civista's products and services have been introduced across the legacy FSB customer base, and customer-facing colleagues are focused on both growing and retaining customers.

Previous wording

On July 10, 2025, CBI announced an underwritten public offering of up to a maximum of 3,788,238 of its common shares. CBI subsequently closed on the sale of 3,294,120 common shares on July 14, 2025, and the sale of an additional 494,118 common shares on July 16, 2025 pursuant to the underwriters' exercise of their overallotment option, at the public offering price of $21.25 per share. The aggregate net proceeds from the offering were approximately $75.7 million, after deducting $608 of direct expenses and the underwriting discount of $4.2 million. The net proceeds from the offering were initially used to pay-down short-term FHLB advances, but the long-term strategic plan is to use the net proceeds for general corporate purposes, which may include supporting organic growth opportunities and future strategic transactions.

Current wording

On July 10, 2025, CBI announced an underwritten public offering of up to a maximum of 3,788,238 of its common shares. CBI closed on the sale of 3,294,120 common shares on July 14, 2025, and subsequently sold an additional 494,118 common shares on July 16, 2025 pursuant to the underwriters' exercise of their overallotment option, at the public offering price of $21.25 per share. The aggregate net proceeds from the offering were approximately $75,666, after deducting $608 of direct expenses and the underwriting discount of $4,226. The net proceeds from the offering were initially used to pay-down short-term FHLB advances, but the long-term strategic plan is to use the net proceeds for general corporate purposes, which may include supporting organic growth opportunities and future strategic transactions.

Previous wording

Total assets of the Company at June 30, 2026 were $4,294,298 compared to $4,336,453 at December 31, 2025, a decrease of $42,155, or 1.0%. The decrease was mainly due to decreases in net loans of $14,835, securities available-for-sale of $14,594, and cash and due from financial institutions of $15,577. These decreases were slightly offset by increases in investments in time deposits of $2,960 and other securities of $3,015. Total liabilities at June 30, 2026 were $3,727,513 compared to $3,792,979 at December 31, 2025, a decrease of $65,466, or 1.7%. The decrease in total liabilities was primarily attributable to decreases in short-term FHLB advances of $51,500 and total deposits of $8,221.

Current wording

Total assets of the Company at September 30, 2026 were $4,304,926 compared to $4,336,453 at December 31, 2025, a decrease of $31,527, or 0.7%. The decrease was mainly due to decreases in securities available-for-sale of $44,656 and cash and due from financial institutions of $9,610. These decreases were slightly offset by an increase in net loans of $22,500. Total liabilities at September 30, 2026 were $3,752,185 compared to $3,792,979 at December 31, 2025, a decrease of $40,794, or 1.1%. The decrease in total liabilities was primarily attributable to a decrease in short-term FHLB advances of $52,500, partially offset by an increase in total deposits of $11,215.

Previous wording

Loans held for sale increased $1,328 since December 31, 2025. The increase was due to an increase in average loan balances held for sale as well as the timing of selling the loans. At June 30, 2026, 28 loans totaling $8,508 were held for sale as compared to 27 loans totaling $7,180 at December 31, 2025.

Current wording

Loans held for sale decreased $3,632 since December 31, 2025. The decrease was due to a decrease in average loan balances held for sale as well as the timing of selling the loans. At September 30, 2026, 12 loans totaling $3,548 were held for sale as compared to 27 loans totaling $7,180 at December 31, 2025.

Previous wording

Net loans decreased $14,835, or 0.5%, since December 31, 2025. The decrease at June 30, 2026 was mainly attributed to decreases in Real Estate Construction, Commercial Real Estate - Non-Owner Occupied, and Farm Real Estate loans, partially offset by increases in Residential Real Estate, Commercial & Agriculture, and Commercial Real Estate - Owner Occupied loans. At June 30, 2026, the loan to deposit ratio was 94.1% compared to 94.3% at December 31, 2025.

Current wording

Net loans increased $22,500, or 0.7%, since December 31, 2025. The increase at September 30, 2026 was mainly attributed to increases in Residential Real Estate, Commercial & Agriculture, Commercial Real Estate - Owner Occupied, and Lease Financing Receivables, partially offset by decreases in Commercial Real Estate - Non-Owner Occupied, Farm Real Estate, Consumer and Other, and Real Estate Construction loans. At September 30, 2026, the loan to deposit ratio was 94.7% compared to 94.3% at December 31, 2025.

Previous wording

During the first six months of 2026, provisions and recoveries made to the allowances for credit losses and off-balance sheet credit exposures resulted in a net expense of $1,141 to the provision for credit losses, compared to an expense of $2,592 during the same period in 2025. The decrease in the provision expense for the first six months of 2026 was the result of loan balances decreasing $15,142 in addition to favorable changes in economic factors for the six months ended June 30, 2026.

Current wording

During the first nine months of 2026, provisions and recoveries made to the allowances for credit losses and off-balance sheet credit exposures resulted in a net expense of $2,436 to the provision for credit losses, compared to net expense of $2,792 during the same period in 2025. The decrease in the provision expense for the first nine months of 2026 was mainly due to favorable changes in economic factors, partially offset by total loan balances increasing $22,877 for the nine months ended September 30, 2026.

Previous wording

Reserves on the Lease Financing Receivables portfolio decreased at June 30, 2026, primarily related to lower balance growth in 2026 as CLF has experienced lower origination for leases. Total delinquencies on Lease Financing Receivables decreased from December 31, 2025 to June 30, 2026. Lease Financing Receivables 30-59 days past due and 60-89 days past due combined decreased from $2,541 to $675, and the balance of 90 days or greater past due also decreased from $454 to $103. Nonaccrual Lease Financing Receivables decreased from $291 at December 31, 2025 to $28 at June 30, 2026.

Current wording

Reserves on the Lease Financing Receivables portfolio increased slightly at September 30, 2026, primarily related to higher balance growth in 2026 as CLF has experienced higher origination for leases. Total delinquencies on Lease Financing Receivables decreased from December 31, 2025 to September 30, 2026. Lease Financing Receivables 30-59 days past due and 60-89 days past due combined decreased from $2,541 to $1,226, and the balance of 90 days or greater past due also decreased from $454 to $95. Nonaccrual Lease Financing Receivables decreased from $291 at December 31, 2025 to $21 at September 30, 2026.

Previous wording

Net charge-offs for the first six months ended June 30, 2026 totaled $790, compared to net charge-offs of $1,633 for the same period of 2025. For the six months ended June 30, 2026, the Company charged off a total of 21 loans and leases, consisting of three Commercial & Agriculture loans totaling $98, seven Lease Financing Receivables totaling $348, one Commercial Real Estate - Non-Owner Occupied loan totaling $484, seven Consumer and Other loans totaling $20 and three Residential Real Estate loan totaling $30. In addition, during the six months ended June 30, 2026, the Company had recoveries on previously charged-off Commercial & Agriculture loans of $96, Commercial Real Estate - Owner Occupied loans of $3, Commercial Real Estate - Non-Owner Occupied loans of $2, Residential Real Estate loans of $34, Lease Financing Receivables of $44 and Consumer and Other loans of $11. For each loan category, as well as in total, the percentage of net charge-offs to loans was less than one percent. Each of these factors was considered by management as part of the examination of both the level and mix of the allowance by credit type as well as the overall level of the allowance.

Current wording

Net charge-offs for the first nine months ended September 30, 2026 totaled $929, compared to net charge-offs of $2,212 for the same period of 2025. For the nine months ended September 30, 2026, the Company charged off a total of 33 loans and leases, consisting of 12 Commercial & Agriculture loans totaling $1,753, seven Lease Financing Receivables totaling $348, one Commercial Real Estate - Non-Owner Occupied loan totaling $484, nine Consumer and Other loans totaling $46 and four Residential Real Estate loans totaling $47. In addition, during the nine months ended September 30, 2026, the Company had recoveries on previously charged-off Commercial & Agriculture loans of $471, Commercial Real Estate - Owner Occupied loans of $9, Commercial Real Estate - Non-Owner Occupied loans of $961, Residential Real Estate loans of $68, Lease Financing Receivables of $227 and Consumer and Other loans of $13. For each loan category, as well as in total, the percentage of net charge-offs to loans was less than one percent. Each of these factors was considered by management as part of the examination of both the level and mix of the allowance by credit type as well as the overall level of the allowance.

Previous wording

Loans are generally moved to nonaccrual status when 90 days or more past due or at an earlier date when full collection of principal and interest is in doubt. Total loans 90 days or more past due increased from $4,109 at December 31, 2025 to $13,853 at June 30, 2026; however, this increase can be attributed to one Commercial Real Estate - Non-Owner Occupied loan with a balance of approximately $7,900 that was 30-59 days past due as of December 31, 2025 and became greater than 90 days past due by June 30, 2026, which is why total loans past due did not experience the same trend, decreasing slightly from December 31, 2025 to June 30, 2026. Further, this loan was already moved to nonaccrual as of December 31, 2025 and was individually evaluated for purpose of the December 31, 2025 allowance calculation, resulting in a specific reserve of $3,000. As of June 30, 2026, the loan remains on nonaccrual and continues to be individually evaluated with a $2,000 specific reserve. For this reason, nonaccrual loans did not move consistently with the increase in 90 days or more past due, decreasing slightly from $30,834 at December 31, 2025 to $29,865 at June 30, 2026 and the increase in 90 days or more past due did not result in an increase to our estimated allowance, because the related risk was already accounted for in both the December 31, 2025 and June 30, 2026 allowance for credit loss estimate. Loans, or portions thereof, are charged-off when deemed uncollectible. The allowance for credit losses as a percent of total loans was 1.28% at both June 30, 2026 and December 31, 2025.

Current wording

Loans are generally moved to nonaccrual status when 90 days or more past due or at an earlier date when full collection of principal and interest is in doubt. Total loans 90 days or more past due increased from $4,109 at December 31, 2025 to $15,060 at September 30, 2026; however, this increase can be attributed primarily to one Commercial Real Estate - Non-Owner Occupied loan with a balance of approximately $7,900 that was 30-59 days past due as of December 31, 2025 and became greater than 90 days past due by prior quarter, which is why total loans past due did not experience the same trend, decreasing slightly from December 31, 2025 to September 30, 2026. Further, this loan was already moved to nonaccrual as of December 31, 2025 and was individually evaluated for purpose of the December 31, 2025 allowance calculation, resulting in a specific reserve of $3,000. As of September 30, 2026, the loan remains on nonaccrual and continues to be individually evaluated with a $2,000 specific reserve. For this reason, nonaccrual loans did not move consistently with the increase in 90 days or more past due, decreasing slightly from $30,834 at December 31, 2025 to $27,555 at September 30, 2026, and the increase in 90 days or more past due did not result in an increase to our estimated allowance, because the related risk was already accounted for in both the December 31, 2025 and September 30, 2026 allowance for credit loss estimate. Loans, or portions thereof, are charged-off when deemed uncollectible. The allowance for credit losses as a percent of total loans was 1.29% and 1.28% as of September 30, 2026 and December 31, 2025, respectively.

Previous wording

Cash and due from financial institutions decreased by $15,577, from $77,320 at December 31, 2025 to $61,743 at June 30, 2026. The decrease is mainly due to a decrease in overnight investments at the Federal Reserve.

Current wording

Cash and due from financial institutions decreased by $9,610, from $77,320 at December 31, 2025 to $67,710 at September 30, 2026. The decrease is mainly due to a decrease in overnight investments at the Federal Reserve.

Previous wording

The available-for-sale securities portfolio decreased by $14,594, from $681,908 at December 31, 2025 to $667,314 at June 30, 2026. Management continually evaluates our securities portfolio in response to established asset/liability management objectives, changing market conditions that could affect profitability, and the level of interest rate risk to which the Company is exposed. These evaluations may cause the Company to change the level of funds it deploys into investment securities and change the composition of its investment securities portfolio. As of June 30, 2026, the Company was in compliance with all pledging requirements.

Current wording

The available-for-sale securities portfolio decreased by $44,656, from $681,908 at December 31, 2025 to $637,252 at September 30, 2026. Management continually evaluates our securities portfolio in response to established asset/liability management objectives, changing market conditions that could affect profitability, and the level of interest rate risk to which the Company is exposed. These evaluations may cause the Company to change the level of funds it deploys into investment securities and change the composition of its investment securities portfolio. As of September 30, 2026, the Company was in compliance with all pledging requirements.

Previous wording

The Company had approximately $638,065 and $647,472 of uninsured deposits as of June 30, 2026 and December 31, 2025, respectively. Uninsured deposit amounts are estimated based on the portions of customer account balances that exceed the FDIC insurance limit of $250.

Current wording

The Company had approximately $701,816 and $647,472 of uninsured deposits as of September 30, 2026 and December 31, 2025, respectively. Uninsured deposit amounts are estimated based on the portions of customer account balances that exceed the FDIC insurance limit of $250.

Previous wording

Total deposits at June 30, 2026 decreased $8,221 from December 31, 2025. Time deposits and savings and money markets increased $33,823 and $36,496, respectively, from December 31, 2025, while brokered deposits, interest-bearing demand deposits, and noninterest-bearing demand deposits decreased $51,999, $19,651, and $6,890, respectively, from December 31, 2025. The increase in time deposits was mainly due to an increase in jumbo time deposits of $26.5 million and retail certificates of deposit of $8.8 million, respectively. The increase in savings and money markets was due to increases of $34,150 and $10,555 in business money market deposits and public fund money market accounts, respectively, partially offset by a decrease in Insured Cash Sweep (ICS) money market deposits of $5,132. Brokered deposits decreased $51,999 as the Company continues its strategy to reduce brokered deposits and replace them with core deposits. The decrease in interest-bearing demand deposits was primarily due to decreases of $12,448 and $10,441 in retail interest-bearing demand deposits and interest-bearing public fund accounts, respectively, partially offset by an increase of $4,566 in business interest-bearing demand deposits. The decrease in noninterest-bearing demand deposits was mainly due to a decrease in business commercial deposits. The year-to-date average balance of total deposits increased $273,096, compared to the average balance for the same period in 2025 due to increases of $127,663, $107,559, and $37,874 in the average balance of time deposits, demand and savings deposits, and noninterest-bearing deposits, respectively.

Current wording

Total deposits at September 30, 2026 increased $11,215 from December 31, 2025. Savings and money markets, time deposits, and noninterest-bearing deposits increased $52,334, $34,595 and $23,371, respectively, from December 31, 2025, while brokered deposits and interest-bearing demand deposits decreased $77,008 and $22,077, respectively, from December 31, 2025. The increase in savings and money markets was due to increases of $63,353 and $12,577 in business money market deposits and public fund money market accounts, respectively, partially offset by a decrease in consumer savings and money market deposits of $12,233. The increase in time deposits was mainly due to an increase in jumbo time deposits of $34,078. Brokered deposits decreased $77,008 as the Company continues its strategy to reduce brokered deposits and replace them with core deposits. The decrease in interest-bearing demand deposits was primarily due to decreases of $16,594 and $9,155 in retail interest-bearing demand deposits and interest-bearing public fund accounts, respectively, partially offset by an increase of $4,951 in business interest-bearing demand deposits. The increase in noninterest-bearing demand deposits was mainly due to an increase in public funds deposits. The year-to-date average balance of total deposits increased $255,439, compared to the average balance for the same period in 2025 due to increases of $115,509, $96,604, and $43,326 in the average balance of demand and savings deposits, time deposits and noninterest-bearing deposits, respectively.

Previous wording

Short-term FHLB advances decreased $51,500 from December 31, 2025 to June 30, 2026, due to liquidity generated from reductions in loans and in our securities portfolio, together with operating cash flows, which were used to repay short-term FHLB advances.

Current wording

Short-term FHLB advances decreased $52,500 from December 31, 2025 to September 30, 2026, due to liquidity generated from reductions in our securities portfolio and with operating cash flows, which were used to repay short-term FHLB advances.

Previous wording

Shareholders’ equity at June 30, 2026 was $566,785, or 13.2% of total assets, compared to $543,474, or 12.5% of total assets, at December 31, 2025. The increase was a result of net income of $29,304 and a decrease in accumulated other comprehensive loss of $645 resulting from the change in the unrealized loss on available-for-sale securities and derivatives, in addition to an increase of $1,153 in stock compensation , partially offset by dividends paid on common shares of $7,473.

Current wording

Shareholders’ equity at September 30, 2026 was $552,741, or 12.8% of total assets, compared to $543,474, or 12.5% of total assets, at December 31, 2025. The increase was a result of net income of $45,323, mostly offset by an increase in accumulated other comprehensive loss of $23,633 resulting from the change in the unrealized loss on available-for-sale securities and derivatives, $11,216 in dividends paid to common shareholders, and $2,535 in share repurchases.

Previous wording

Total outstanding common shares at June 30, 2026 were 20,794,238, which increased slightly from 20,746,474 common shares outstanding at December 31, 2025. Common shares outstanding increased due to the grant of 10,890 common shares to Civista directors as payment for their service on the Civista Board of Directors and 51,378 restricted common shares to certain officers under the Company’s 2024 Incentive Plan, partially offset by 14,504 common shares surrendered by officers to the Company to pay taxes upon vesting of restricted shares.

Current wording

Total outstanding common shares at September 30, 2026 were 20,712,013, which decreased slightly from 20,746,474 common shares outstanding at December 31, 2025. Common shares outstanding decreased resulting from the Company repurchasing 82,075 common shares under its existing share repurchase program and 14,654 common shares surrendered by officers to the Company to pay taxes upon vesting of restricted shares, mostly offset by the grant of 10,890 common shares to Civista directors as payment for their service on the Civista Board of Directors and 51,378 restricted common shares to certain officers under the Company’s 2024 Incentive Plan.

Previous wording

The Company had net income of $14,315 for the three months ended June 30, 2026, an increase of $3,300 from net income of $11,015 for the same period of 2025. Basic and diluted earnings per common share were $0.69 for the quarter ended June 30, 2026, compared to $0.71 for the same period of 2025. In the second quarter of 2025, net income was increased by $757 from non-recurring adjustments resulting from the Civista Leasing and Finance ("CLF") division's core system conversion. The primary reasons for the changes in net income are explained below.

Current wording

The Company had net income of $16,019 for the three months ended September 30, 2026, an increase of $3,259 from net income of $12,760 for the same period of 2025. Basic and diluted earnings per common share were $0.77 for the quarter ended September 30, 2026, compared to $0.68 for the same period of 2025. In the third quarter of 2025, net income was decreased by $554 from acquisition-related expenses related to the acquisition of FSB that closed in the fourth quarter of 2025. The primary reasons for the changes in net income are explained below.

Previous wording

Net interest income for the six months ended June 30, 2026 was $76,416, an increase of $8,829 from $67,587 for the same period of 2025. For the six months ended June 30, 2025, net interest income was increased by $1,621 resulting from the non-recurring adjustments from the CLF core system conversion. The year-to-date increase was a result of an increase of $2,352 in total interest and dividend income, coupled with a $6,477 decrease in total interest expense. Total interest-earning assets averaged $3,998,020 during the six months ended June 30, 2026, an increase of $176,371 from $3,821,649 for the same period of 2025. The Company’s total average interest-bearing liabilities decreased from $3,010,528 during the six months ended June 30, 2025 to $3,034,362 during the six months ended

Current wording

Net interest income for the three months ended September 30, 2026 was $39,430, an increase of $4,885 from $34,545 for the same period of 2025. The quarterly increase was a result of an increase of $2,583 in total interest and dividend income, coupled with a $2,302 decrease in total interest expense. Total interest-earning assets averaged $3,993,704 during the three months ended September 30, 2026, an increase of $164,220 from $3,829,484 for the same period of 2025. The Company’s total average interest-bearing liabilities increased from $2,957,458 during the three months ended September 30, 2025 to $2,973,690 during the three months ended September 30, 2026. The Company’s fully tax equivalent net interest margin for the three months ended September 30, 2026 and 2025 was 3.93% and 3.58%, respectively.

Previous wording

Total interest and dividend income was $56,547 for the three months ended June 30, 2026, an increase of $276 from $56,271 for the same period of 2025. The increase in interest and dividend income is mainly attributable to increases of $156 and $264 in taxable securities and deposits in other banks, respectively, partially offset by a decrease in interest and fees on loans of $84 which was impacted by the non-recurring adjustment mentioned above in the second quarter of 2025. The average balance of loans increased by $107,864, or 3.4%, to $3,243,955 for the three months ended June 30, 2026, as compared to $3,136,091 for the same period of 2025.

Current wording

Total interest and dividend income was $57,823 for the three months ended September 30, 2026, an increase of $2,583 from $55,240 for the same period of 2025. The increase in interest and dividend income is mainly attributable to an increase of $2,667 in interest and fees on loans. The average balance of loans increased by $145,983, or 4.7%, to $3,274,016 for the three months ended September 30, 2026, as compared to $3,128,033 for the same period of 2025. The yield on loans increased 5 basis points to 6.23% for the three months ended September 30, 2026, compared to 6.18% for the same period of 2025, mainly resulting from the yield on new and repricing loans and changes in portfolio mix.

Previous wording

Total interest expense decreased $3,503, or 16.3%, to $17,954 for the three months ended June 30, 2026, compared to $21,457 for the same period of 2025. For the three months ended June 30, 2026, the average balance of interest-bearing liabilities decreased $64,498 to $2,997,826, as compared to $3,062,324 for the same period of 2025. Interest incurred on deposits increased by $336 to $15,894 for the three months ended June 30, 2026, compared to $15,558 for the same period of 2025. The average balance of interest-bearing deposits increased by $243,145 to $2,781,645 for the three months ended June 30, 2026, as compared to the same period in 2025, which was almost fully offset by the decrease in the rate paid on interest-bearing deposits from 2.46% for the second quarter of 2025 to 2.29% in the second quarter of 2026. The decrease in rates was mainly driven by time deposits related to paying lower rates on retail and brokered CDs due to the lower rate environment in the second quarter of 2026 compared to the same period of 2025. Interest expense incurred on short-term FHLB advances decreased mainly due to the average balance of short-term FHLB advances decreasing by $304,722 to $107,823 for the three months ended June 30, 2026, as compared to the same period in 2025.

Current wording

Total interest expense decreased $2,302, or 11.1%, to $18,393 for the three months ended September 30, 2026, compared to $20,695 for the same period of 2025. For the three months ended September 30, 2026, the average balance of interest-bearing liabilities increased $16,232 to $2,973,690, as compared to $2,957,458 for the same period of 2025. Interest incurred on deposits decreased by $458 to $15,889 for the three months ended September 30, 2026, compared to $16,347 for the same period of 2025. The average balance of interest-bearing deposits increased by $164,343 to $2,738,496 for the three months ended September 30, 2026, as compared to the same period in 2025, which was almost fully offset by the decrease in the rate paid on interest-bearing deposits from 2.52% for the third quarter of 2025 to 2.30% for the third quarter of 2026. The decrease in rates was mainly driven by time deposits related to paying lower rates on retail deposits in the third quarter of 2026 compared to the same period of 2025, resulting from a lower year-over-year interest-rate environment and continued optimization of Civista's funding mix. Interest expense incurred on short-term FHLB advances decreased $1,746 for the three months ended September 30, 2026, mainly due to the average balance of short-term FHLB advances decreasing by $145,485 to $127,500 for the three months ended September 30, 2026, as compared to the same period in 2025.

Previous wording

The following table presents the condensed average balance sheets for the six months ended June 30, 2026 and 2025. The daily average loan amounts outstanding are net of unearned income and include loans held for sale and nonaccrual loans. The average balance of securities is computed using the carrying value of securities. Rates are annualized and taxable equivalent yields are computed using a 21% tax rate for tax-exempt interest income. The average yield has been computed using the historical amortized cost average balance for available-for-sale securities.

Current wording

The following table presents the condensed average balance sheets for the three months ended September 30, 2026 and 2025. The daily average loan amounts outstanding are net of unearned income and include loans held for sale and nonaccrual loans. The average balance of securities is computed using the carrying value of securities. Rates are annualized and taxable equivalent yields are computed using a 21% tax rate for tax-exempt interest income. The average yield has been computed using the historical amortized cost average balance for available-for-sale securities.

Previous wording

(1) Net interest spread represents the difference between the yield on average interest-earning assets and the cost of interest-bearing liabilities.

Current wording

(1) Net interest income and interest rate spread represents the difference between the yield on average interest-earning assets and the cost of interest-bearing liabilities.

Previous wording

*Average yields are presented on a tax equivalent basis. The tax equivalent effect associated with loans and investments, included in the yields above, was $606 and $622 for the three months ended June 30, 2026 and 2025, respectively.

Current wording

*Average yields are presented on a tax equivalent basis. The tax equivalent effect associated with loans and investments, included in the yields above, was $599 and $618 for the three months ended September 30, 2026 and 2025, respectively.

Previous wording

The Company provides for credit losses through regular provisions to the allowance for credit losses. During the three months ended June 30, 2026, the Company recorded a provision for credit losses for loans and off-balance sheet credit exposures of $1,770, an increase of $745, from an expense of $1,025 during the three months ended June 30, 2025.

Current wording

The Company provides for credit losses through regular provisions to the allowance for credit losses. During the three months ended September 30, 2026, the Company recorded a provision for credit losses for loans and off-balance sheet credit exposures of $1,295, an increase of $1,095, from an expense of $200 for the three months ended September 30, 2025.

Previous wording

Total noninterest expense for the three months ended June 30, 2026 was $28,653, an increase of $1,171 or 4.3%, from $27,482 compared to the same period of 2025. Noninterest expenses were reduced by $311 in the second quarter of 2025 from non-recurring adjustments resulting from the CLF core system conversion. The increase in total noninterest expense was primarily due to increases in compensation, amortization of core deposit intangibles, and other expenses, partially offset by decreases in FDIC assessment and professional fees. The increase in compensation expense was primarily due to increases in salaries, commissions, and medical expenses associated with operating with higher average full-time equivalent (FTE) employees year-over-year. The average number of FTEs for the three months ended June 30, 2026 was 549, compared to 526 for the same period of 2025. The increase in amortization of core deposit intangibles is related to the FSB merger. The increase in other expense is mainly related to the non-recurring adjustment mentioned above in the second quarter of 2025. The decrease in FDIC assessment is mainly due to an improvement in Civista's risk-based assessment rate, reflecting favorable trends in regulatory ratios and supervisory metrics used in the FDIC's pricing methodology. The decrease in professional fees is primarily due to higher consulting expenses in 2025 related to CLF's core system conversion.

Current wording

Total noninterest expense for the three months ended September 30, 2026 was $27,978, a decrease of $349 or 1.2%, from $28,327 for the same period of 2025. Noninterest expenses were increased by $664 in the third quarter of 2025 from pre-tax acquisition-related expenses related to the acquisition of FSB. The decrease in total noninterest expense was primarily due to decreases in equipment expense, FDIC assessment, and other expense, mostly offset by increases in amortization of core deposit intangibles and compensation expense. The decrease in equipment expense is mostly due to $737 in depreciation expense recorded in the third quarter of 2025 on assets that had a net book value but are no longer in use. The decrease in FDIC assessment is mainly due to an improvement in Civista's risk-based assessment rate, reflecting favorable trends in regulatory ratios and supervisory metrics used in the FDIC's pricing methodology. The decrease in other expense is mainly related to the non-recurring adjustment mentioned above in the third quarter of 2025. The increase in amortization of core deposit intangibles is related to the FSB merger. The increase in compensation expense was primarily due to increases in salaries and medical expenses associated with operating with higher average full-time equivalent (FTE) employees year-over-year. The average number of FTEs for the three months ended September 30, 2026 was 555, compared to 524 for the same period of 2025.

Previous wording

Income tax expense for the three months ended June 30, 2026 totaled $2,862, up $981 compared to the same period of 2025. The effective tax rates for the three month periods ended June 30, 2026 and 2025 were 16.7% and 14.6%, respectively. The increase in the effective tax rate for the three month period ended June 30, 2026, was primarily due to an increase in the forecasted pre-tax income outpacing the permanent differences for 2026, thus, creating more taxable income at the statutory tax rate of 21% and increasing the Company's effective tax rate. The difference between the statutory federal income tax rate and the Company’s effective tax rate is the permanent tax differences, primarily consisting of tax-exempt interest income from municipal investments and loans, low-income housing tax credits, tax-deductible captive insurance premiums and bank owned life insurance income.

Current wording

Income tax expense for the three months ended September 30, 2026 totaled $3,789, up $898 compared to the same period of 2025. The effective tax rates for the three month periods ended September 30, 2026 and 2025 were 19.1% and 18.5%, respectively. The increase in the effective tax rate for the three month period ended September 30, 2026, was primarily due to an increase in the forecasted pre-tax income outpacing the permanent differences for 2026, thus, creating more taxable income at the statutory tax rate of 21% and increasing the Company's effective tax rate. The difference between the statutory federal income tax rate and the Company’s effective tax rate is the permanent tax differences, primarily consisting of tax-exempt interest income from municipal investments and loans, low-income housing tax credits, tax-deductible captive insurance premiums and bank owned life insurance income.

Previous wording

The Company had net income of $29,304 for the six months ended June 30, 2026, an increase of $8,121 from $21,183 for the same period of 2025. Basic and diluted earnings per common share were $1.41 for the six months ended June 30, 2026, compared to $1.37 for the same period of 2025. For the six months ended June 30, 2026, net income was reduced by $374 from non-recurring adjustments related to acquisition-related expenses associated with the FSB merger. For the six months ended June 30, 2025, net income was increased by $757 from non-recurring adjustments resulting from the CLF core system conversion. The primary reasons for the changes in net income are explained below.

Current wording

The Company had net income of $45,323 for the nine months ended September 30, 2026, an increase of $11,380 from $33,943 for the same period of 2025. Basic and diluted earnings per common share were $2.18 for the nine months ended September 30, 2026, compared to $2.04 for the same period of 2025. For the nine months ended September 30, 2026, net income was reduced by $358 from non-recurring adjustments related to acquisition-related expenses associated with the FSB merger. For the nine months ended September 30, 2025, net income was increased by $203 from non-recurring adjustments resulting from the CLF core system conversion, mostly offset by the acquisition-related expenses of FSB. The primary reasons for the changes in net income are explained below.

Previous wording

Net interest income for the three months ended June 30, 2026 was $38,593, an increase of $3,779 from $34,814 for the same period of 2025. In the second quarter of 2025, net interest income was increased by $1,621 resulting from the non-recurring adjustments from the CLF core system conversion. The quarterly increase was a result of an increase of $276 in total interest and dividend income, coupled with a $3,503 decrease in total interest expense. Total interest-earning assets averaged $3,992,950 during the three months ended June 30, 2026, an increase of $151,581 from $3,841,369 for the same period of 2025. The Company’s total average interest-bearing liabilities decreased from $3,062,324 during the three months ended June 30, 2025 to $2,997,826 during the three months ended June 30, 2026. The Company’s fully tax equivalent net interest margin for the three months ended June 30, 2026 and 2025 was 3.89% and 3.64%, respectively.

Current wording

Net interest income for the nine months ended September 30, 2026 was $115,846, an increase of $13,714 from $102,132 for the same period of 2025. For the nine months ended September 30, 2025, net interest income was increased by $1,621 resulting from the non-recurring adjustments from the CLF core system conversion. The year-to-date increase was a result of an increase of $4,935 in total interest and dividend income, coupled with an $8,779 decrease in total interest expense. Total interest-earning assets averaged $3,996,566 during the nine months ended September 30, 2026, an increase of $172,277 from $3,824,289 for the same period of 2025. The Company’s total average interest-bearing liabilities decreased from $3,007,668 during the nine months ended September 30, 2025 to $2,998,112 during the nine months ended September 30, 2026. The Company’s fully tax equivalent net interest margin for the nine months ended September 30, 2026 and 2025 was 3.89% and 3.58%, respectively.

Previous wording

Total interest and dividend income was $112,356 for the six months ended June 30, 2026, an increase of $2,352 from $110,004 for the same period of 2025. The increase in interest and dividend income is mainly attributable to increases of $1,500, $555 and $394 in interest and fees on loans, taxable securities and deposits in other banks, respectively, partially offset by a decrease in tax-exempt securities of $97. The average balance of loans increased by $130,259, or 4.2%, to $3,248,126 for the six months ended June 30, 2026, as compared to $3,117,867 for the same period of 2025.

Current wording

Total interest and dividend income was $170,179 for the nine months ended September 30, 2026, an increase of $4,935 from $165,244 for the same period of 2025. The increase in interest and dividend income is mainly attributable to increases of $4,166, $504, and $431 in interest and fees on loans, taxable securities and deposits in other banks, respectively, slightly offset by a decrease in tax-exempt securities of $166. The average balance of loans increased by $135,559, or 4.3%, to $3,256,851 for the nine months ended September 30, 2026, as compared to $3,121,292 for the same period of 2025.

Previous wording

Total interest expense decreased $6,477, or 15.3%, to $35,940 for the six months ended June 30, 2026, compared to $42,417 for the same period of 2025. For the six months ended June 30, 2026, the average balance of interest-bearing liabilities decreased $23,834 to $3,010,528, as compared to $3,034,362 for the same period of 2025. Interest incurred on deposits were basically flat at $31,347 for the six months ended June 30, 2026, compared to $31,274 for the same period of 2025. The average balance of interest-bearing deposits increased by $235,222 to $2,773,752 for the six months ended June 30, 2026, as compared to the same period in 2025, which was fully offset by the decrease in the rate paid on interest-bearing deposits from 2.48% for the six months ended June 30, 2025 to 2.28% for the six months ended June 30, 2026. The decrease in rates was mainly driven by paying lower rates on retail and brokered CDs due to the lower rate environment in the first six month of 2026 compared to the same period of 2025. Interest expense incurred on short-term FHLB advances decreased mainly due to the average balance of short-term FHLB advances decreasing by $256,097 to $128,127 for the six months ended June 30, 2026, as compared to the same period in 2025.

Current wording

Total interest expense decreased $8,779, or 13.9%, to $54,333 for the nine months ended September 30, 2026, compared to $63,112 for the same period of 2025. For the nine months ended September 30, 2026, the average balance of interest-bearing liabilities decreased $9,556 to $2,998,112, as compared to $3,007,668 for the same period of 2025. Interest incurred on deposits decreased $385 to $47,236 for the nine months ended September 30, 2026, compared to $47,621 for the same period in 2025. The average balance of interest-bearing deposits increased by $212,113 to $2,761,870 for the nine months ended September 30, 2026, as compared to the same period in 2025, which was fully offset by the decrease in the rate paid on interest-bearing deposits from 2.50% for the nine months ended September 30, 2025 to 2.29% for the nine months ended September 30, 2026. The decrease in rates was mainly driven by paying lower rates on time deposits due to the repricing of maturing time deposits at lower rates consistent with the short-term interest rate environment in the first nine months of 2026 compared to the same period of 2025. Interest expense incurred on short-term FHLB advances decreased mainly due to the average balance of short-term FHLB advances decreasing by $218,822 to $127,915 for the nine months ended September 30, 2026, as compared to the same period in 2025. The decrease in the average balance of short-term FHLB advances is the result of increased deposit funding reducing the need for higher-cost wholesale funding.

Previous wording

The following table presents the condensed average balance sheets for the three months ended June 30, 2026 and 2025. The daily average loan amounts outstanding are net of unearned income and include loans held for sale and nonaccrual loans. The average balance of securities is computed using the carrying value of securities. Rates are annualized and taxable equivalent yields are computed using a

Current wording

The following table presents the condensed average balance sheets for the nine months ended September 30, 2026 and 2025. The daily average loan amounts outstanding are net of unearned income and include loans held for sale and nonaccrual loans. The average balance of securities is computed using the carrying value of securities. Rates are annualized and taxable equivalent yields are computed using a 21% tax rate for tax-exempt interest income. The average yield has been computed using the historical amortized cost average balance for available-for-sale securities.

Previous wording

(1) Net interest spread represents the difference between the yield on average interest-earning assets and the cost of interest-bearing liabilities.

Current wording

(1) Net interest income and interest rate spread represents the difference between the yield on average interest-earning assets and the cost of interest-bearing liabilities.

Previous wording

*Average yields are presented on a tax equivalent basis. The tax equivalent effect associated with loans and investments, included in the yields above, was $1.2 million and $1.2 million for the six month periods ended June 30, 2026 and 2025, respectively.

Current wording

*Average yields are presented on a tax equivalent basis. The tax equivalent effect associated with loans and investments, included in the yields above, was $1.8 million and $1.9 million for the nine month periods ended September 30, 2026 and 2025, respectively.

Previous wording

Net interest income may also be analyzed by comparing the volume and rate components of interest income and interest expense. The following table provides an analysis of the changes in interest income and expense between the six months ended June 30, 2026 and 2025. The table is presented on a fully tax-equivalent basis.

Current wording

Net interest income may also be analyzed by comparing the volume and rate components of interest income and interest expense. The following table provides an analysis of the changes in interest income and expense between the nine months ended September 30, 2026 and 2025. The table is presented on a fully tax-equivalent basis.

Previous wording

The Company provides for credit losses through regular provisions to the allowance for credit losses. During the six months ended June 30, 2026, the Company recorded a provision for credit losses of $1,141, a decrease of $1,451, from $2,592 during the six months ended June 30, 2025.

Current wording

The Company provides for credit losses through regular provisions to the allowance for credit losses. During the nine months ended September 30, 2026, the Company recorded a provision for credit losses of $2,436, a decrease of $356, from $2,792 during the nine months ended September 30, 2025.

Previous wording

Total noninterest income for the three months ended June 30, 2026 was $9,007, an increase of $2,418, or 36.7%, from $6,589 for the same period of 2025. Noninterest income was reduced by $1,044 in the second quarter of 2025 from non-recurring adjustments resulting from the CLF core system conversion. Service charges increased $325 for the three months ended June 30, 2026, compared to the same period of 2025, primarily from higher business service charges and retail overdrafts. Net gain on sale of loans and leases increased $660 for the three months ended June 30, 2026, compared to the same period of 2025, resulting from favorable secondary market conditions resulting in higher sales volumes for both loans and leases. Lease revenue and residual income increased $879 for the three months ended June 30, 2026, compared to the same period of 2025, mainly due to the non-recurring adjustment noted above.

Current wording

Total noninterest income for the nine months ended September 30, 2026 was $28,089, an increase of $4,007, or 16.6%, from $24,082 for the same period of 2025. Noninterest income was reduced by $1,044 for the nine months ended September 30, 2025, from non-recurring adjustments resulting from the CLF core system conversion. Service charges increased $682 for the nine months ended September 30, 2026, compared to the same period of 2025, primarily from higher business service charges and retail overdraft fees. Net loss on sale of debt securities was $1,571 for the nine months ended September 30, 2026 as part of a balance sheet repositioning strategy. Mortgage banking income increased $779 for the nine months ended September 30, 2026, compared to the same period in 2025, reflecting improved secondary market execution and disciplined pricing strategies. During the third quarter of 2026, the Company began utilizing mandatory-delivery commitments as part of its secondary-market execution strategy. Leasing and commercial finance revenue increased $1,290 for the nine months ended September 30, 2026, compared to the same period of 2025, mainly due to higher lease origination activity in 2026, partially offset by the non-recurring adjustment noted above.

Previous wording

The components of noninterest expense for the six month periods ended June 30, 2026 and 2025 are as follows:

Current wording

The components of noninterest expense for the nine month periods ended September 30, 2026 and 2025 are as follows:

Previous wording

Total noninterest expense for the six months ended June 30, 2026 was $58,526, an increase of $3,918, or 7.2%, from $54,608 compared to the same period of 2025. Noninterest expenses were reduced by $311 for the six months ended June 30, 2025 from non-recurring adjustments resulting from the CLF core system conversion. The increase in total noninterest expense was primarily due to increases in compensation, marketing, amortization of core deposit intangibles, software maintenance, and other expenses, partially offset by decreases in FDIC assessment and professional fees. The increase in compensation expense was primarily due to increases in salaries, commissions, and medical expenses resulting from operating with higher average full-time equivalent (FTE) employees year-over-year. The average number of FTEs for the six months ended June 30, 2026 was 548, compared to 523 for the same period of 2025. The increase in marketing expenses is related to an increase in digital marketing campaigns. The increase in amortization of core deposit intangibles is related to the FSB merger. The increase in software maintenance expense is primarily related to year-over-year maintenance increases as well as having more users increasing licensing costs. The increase in other expense is mainly related to the non-recurring adjustments related to the FSB merger for the six months ended June 30, 2026 and the non-recurring adjustment mentioned above related to the CLF core system conversion for the six months ended June 30, 2025. The decrease in FDIC assessment is mainly due to an improvement in Civista's risk-based assessment rate, reflecting favorable trends in regulatory ratios and supervisory metrics used in the FDIC's pricing methodology. The decrease in professional fees is primarily due to lower consulting expenses related to CLF's core system conversion.

Current wording

Total noninterest expense for the nine months ended September 30, 2026 was $86,504, an increase of $3,569, or 4.3%, from $82,935 compared to the same period of 2025. Noninterest expenses were reduced by $311 for the nine months ended September 30, 2025 from non-recurring adjustments resulting from the CLF core system conversion. The increase in total noninterest expense was primarily due to increases in compensation, marketing, amortization of core deposit intangibles, software maintenance, and other expenses, partially offset by decreases in FDIC assessment, equipment expense and professional fees. The increase in compensation expense was primarily due to increases in salaries, commissions, and medical expenses resulting from operating with higher average full-time equivalent (FTE) employees year-over-year. The average number of FTEs for the nine months ended September 30, 2026 was 550, compared to 523 for the same period of 2025. The increase in marketing expenses is related to an increase in digital marketing campaigns. The increase in amortization of core deposit intangibles is related to the FSB merger. The increase in software maintenance expense is primarily related to year-over-year maintenance increases as well as having more users increasing licensing costs. The increase in other expense is mainly related to the non-recurring adjustments related to the FSB merger for the nine months ended September 30, 2026 and the non-recurring adjustment mentioned above related to the CLF core system conversion for the nine months ended September 30, 2025. The decrease in FDIC assessment is mainly due to an improvement in Civista's risk-based assessment rate, reflecting favorable trends in regulatory ratios and supervisory metrics used in the FDIC's pricing methodology. The decrease in professional fees is primarily due to lower consulting expenses related to CLF's core system conversion. The decrease in equipment expense is mostly due to $737 in depreciation expense recorded in the third quarter of 2025 on assets that had a net book value but are no longer in use.