First Guaranty Bancshares, Inc.

Previous wording

First Guaranty Bancshares is a Louisiana corporation and a financial holding company headquartered in Hammond, Louisiana. Our wholly-owned subsidiary, First Guaranty Bank, a Louisiana-chartered commercial bank, provides personalized commercial banking services primarily to Louisiana and Texas customers through 35 banking facilities primarily located in the MSAs of Hammond, Baton Rouge, Lafayette, Shreveport-Bossier City, Lake Charles and Alexandria, Louisiana and Dallas-Fort Worth-Arlington, Waco, Texas and Mideast markets in Kentucky and West Virginia. We emphasize personal relationships and localized decision making to ensure that products and services are matched to customer needs. We compete for business principally on the basis of personal service to customers, customer access to officers and directors and competitive interest rates and fees.

Current wording

First Guaranty Bancshares is a Louisiana corporation and a financial holding company headquartered in Hammond, Louisiana. Our wholly-owned subsidiary, First Guaranty Bank, a Louisiana-chartered commercial bank, provides personalized commercial banking services primarily to Louisiana and Texas customers through 30 banking facilities primarily located in the MSAs of Hammond, Baton Rouge, Lafayette, Shreveport-Bossier City, and Alexandria, Louisiana and Dallas-Fort Worth-Arlington, Waco, Texas and Mideast markets in Kentucky and West Virginia. We emphasize personal relationships and localized decision making to ensure that products and services are matched to customer needs. We compete for business principally on the basis of personal service to customers, customer access to officers and directors and competitive interest rates and fees.

Previous wording

Total assets were $4.0 billion at December 31, 2024 and $3.6 billion at December 31, 2023. Total deposits were $3.5 billion at December 31, 2024 and $3.0 billion at December 31, 2023. Total loans were $2.7 billion at December 31, 2024, a decrease of $54.9 million, or 2.0%, compared with $2.7 billion at December 31, 2023. Total shareholders' equity was $255.0 million and $249.6 million at December 31, 2024 and December 31, 2023, respectively.

Current wording

Total assets were $4.1 billion at December 31, 2025 and $4.0 billion at December 31, 2024. Total deposits were $3.6 billion at December 31, 2025 and $3.5 billion at December 31, 2024. Total loans were $2.1 billion at December 31, 2025, a decrease of $624.0 million, or 23.2%, compared with $2.7 billion at December 31, 2024. Total shareholders' equity was $226.2 million and $255.0 million at December 31, 2025 and December 31, 2024, respectively.

Previous wording

Net income was $12.4 million and $9.2 million for the years ended December 31, 2024 and 2023, respectively. We generate most of our revenues from interest income on loans, interest income on securities, sales of securities, ATM and debit card fees and service charges, commissions and fees. We incur interest expense on deposits and other borrowed funds and noninterest expense such as salaries and employee benefits and occupancy and equipment expenses. Net interest income is the difference between interest income earned on interest-earning assets such as loans and securities and interest expense paid on interest-bearing liabilities such as deposits and borrowings which are used to fund those assets. Net interest income is our largest source of revenue. To evaluate net interest income, we measure and monitor: (1) yields on our loans and other interest-earning assets; (2) the costs of our deposits and other funding sources; (3) our net interest spread and (4) our net interest margin. Net interest spread is the difference between rates earned on interest-earning assets and rates paid on interest-bearing liabilities. Net interest margin is calculated as net interest income divided by average interest-earning assets. Because noninterest-bearing sources of funds, such as noninterest-bearing deposits also fund interest-earning assets, net interest margin includes the benefit of these noninterest-bearing sources. The increase in net income was caused principally by an increase in net interest income of $3.7 million, an increase in noninterest income of $14.2 million, and a decrease in noninterest expense of $2.5 million, partially offset by an increase in provision for credit losses of $16.3 million.

Current wording

Net (loss) income was $(56.0) million and $12.4 million for the years ended December 31, 2025 and 2024, respectively. We generate most of our revenues from interest income on loans, interest income on securities, sales of securities, ATM and debit card fees and service charges, commissions and fees. We incur interest expense on deposits and other borrowed funds and noninterest expense such as salaries and employee benefits and occupancy and equipment expenses. Net interest income is the difference between interest income earned on interest-earning assets such as loans and securities and interest expense paid on interest-bearing liabilities such as deposits and borrowings which are used to fund those assets. Net interest income is our largest source of revenue. To evaluate net interest income, we measure and monitor: (1) yields on our loans and other interest-earning assets; (2) the costs of our deposits and other funding sources; (3) our net interest spread and (4) our net interest margin. Net interest spread is the difference between rates earned on interest-earning assets and rates paid on interest-bearing liabilities. Net interest margin is calculated as net interest income divided by average interest-earning assets. Because noninterest-bearing sources of funds, such as noninterest-bearing deposits also fund interest-earning assets, net interest margin includes the benefit of these noninterest-bearing sources. The decrease in net income was the result of a decrease in net interest income of $1.5 million, an increase of $61.7 million in the provision to the credit allowance, a decrease in noninterest income of $16.3 million, and an increase in noninterest expense of $5.1 million, which was attributable to a goodwill impairment charge of $12.9 million.

Previous wording

•Total assets increased $420.0 million, or 11.8%, to $4.0 billion at December 31, 2024 when compared with December 31, 2023. Total loans at December 31, 2024 were $2.7 billion, a decrease of $54.9 million, or 2.0%, compared with December 31, 2023. Total deposits were $3.5 billion at December 31, 2024, an increase of $467.2 million, or 15.5% compared with December 31, 2023. Retained earnings were $73.0 million at December 31, 2024, an increase of $5.0 million compared to $68.0 million at December 31, 2023. Shareholders' equity was $255.0 million and $249.6 million at December 31, 2024 and December 31, 2023, respectively.

Current wording

•Total assets increased $105.6 million, or 2.7%, to $4.1 billion at December 31, 2025 when compared with December 31, 2024. Total loans at December 31, 2025 were $2.1 billion, a decrease of $624.0 million, or 23.2%, compared with December 31, 2024. Total deposits were $3.6 billion at December 31, 2025, an increase of $156.6 million, or 4.5% compared with December 31, 2024. Retained earnings were $14.1 million at December 31, 2025, a decrease of $58.9 million compared to $73.0 million at December 31, 2024. Shareholders' equity was $226.2 million and $255.0 million at December 31, 2025 and December 31, 2024, respectively.

Previous wording

•Earnings per common share were $0.81 for the year ended December 31, 2024 and $0.62 for the year ended December 31, 2023. Total weighted average common shares outstanding were 12,501,035 and 11,165,303 at December 31, 2024 and December 31, 2023, respectively.

Current wording

•(Loss) earnings per common share were $(4.17) for the year ended December 31, 2025 and $0.81 for the year ended December 31, 2024. Total weighted average common shares outstanding were 13,985,460 and 12,501,035 at December 31, 2025 and December 31, 2024, respectively.

Previous wording

•Net interest income for 2024 was $88.4 million compared to $84.7 million for 2023.

Current wording

•Net interest income for 2025 was $86.9 million compared to $88.4 million for 2024.

Previous wording

•The provision for credit losses totaled $20.0 million for 2024 and $3.7 million in 2023.

Current wording

•The provision for credit losses totaled $81.7 million for 2025 and $20.0 million in 2024.

Previous wording

•The net interest margin was 2.47% for 2024 and 2.69% for 2023. Loans as a percentage of average interest earning assets decreased to 77.4% at December 31, 2024 compared to 82.8% at December 31, 2023.

Current wording

•The net interest margin was 2.28% for 2025 and 2.47% for 2024. Loans as a percentage of average interest earning assets decreased to 63.0% at December 31, 2025 compared to 77.4% at December 31, 2024.

Previous wording

•Investment securities totaled $602.7 million at December 31, 2024, an increase of $198.6 million when compared to $404.1 million at December 31, 2023. At December 31, 2024, available for sale securities, at fair value, totaled $281.1 million, an increase of $197.6 million when compared to $83.5 million at December 31, 2023. At December 31, 2024, held to maturity securities, at amortized cost and net of the allowance for credit losses, totaled $321.6 million as compared to $320.6 million at December 31, 2023. The allowance for credit losses for HTM securities was $0.2 million at December 31, 2024, an increase of $0.1 million when compared to $0.1 million at December 31, 2023.

Current wording

•Investment securities totaled $999.3 million at December 31, 2025, an increase of $396.5 million when compared to $602.7 million at December 31, 2024. At December 31, 2025, available for sale securities, at fair value, totaled $676.6 million, an increase of $395.5 million when compared to $281.1 million at December 31, 2024. The increase in available for sale securities was primarily due to purchases of mortgage-backed securities. At December 31, 2025, held to maturity securities, at amortized cost and net of the allowance for credit losses, totaled $322.7 million as compared to $321.6 million at December 31, 2024. The allowance for credit losses for HTM securities was $0.2 million at December 31, 2025 and December 31, 2024.

Previous wording

•Total loans net of unearned income were $2.7 billion at December 31, 2024 a net decrease of $54.9 million from December 31, 2023. Total loans net of unearned income are reduced by the allowance for credit losses which totaled $34.8 million at December 31, 2024 and $30.9 million at December 31, 2023. First Guaranty adopted ASC 326 effective January 1, 2023 and recorded a cumulative adoption adjustment to the allowance of $7.1 million.

Current wording

•Total loans net of unearned income were $2.1 billion at December 31, 2025 a net decrease of $624.0 million from December 31, 2024. Total loans net of unearned income are reduced by the allowance for credit losses which totaled $40.8 million at December 31, 2025 and $34.8 million at December 31, 2024, respectively.

Previous wording

First Guaranty charged off $0.2 million on a commercial and industrial SBA loan relationship during the first quarter of 2024. This relationship had no remaining principal balance at December 31, 2024.

Current wording

First Guaranty charged off $0.2 million on a multifamily loan during the fourth quarter of 2025. This relationship had no remaining principal balance as of December 31, 2025.

Previous wording

First Guaranty charged off $3.9 million on a non-farm non-residential loan relationship during the fourth quarter of 2024. This relationship had remaining principal balance of $23.0 million at December 31, 2024.

Current wording

First Guaranty charged off $3.3 million on a non-farm non-residential loan during the fourth quarter of 2025. This relationship was moved into OREO in the fourth quarter.

Previous wording

•Return on average assets was 0.34% and 0.28% for the years ended December 31, 2024 and 2023, respectively. Return on average common equity was 4.58% and 3.36% for 2024 and 2023, respectively. Return on average assets is calculated by dividing net income by average assets. Return on average common equity is calculated by dividing net income by average common equity.

Current wording

•Return on average assets was (1.43)% and 0.34% for the years ended December 31, 2025 and 2024, respectively. Return on average common equity was (27.05)% and 4.58% for 2025 and 2024, respectively. Return on average assets is calculated by dividing net income by average assets. Return on average common equity is calculated by dividing net income by average common equity.

Previous wording

•Book value per common share was $17.75 as of December 31, 2024 compared to $17.36 as of December 31, 2023. Tangible book value per common share was $16.48 as of December 31, 2024 compared to $16.03 as of December 31, 2023.

Current wording

•Book value per common share was $12.23 as of December 31, 2025 compared to $17.75 as of December 31, 2024. Tangible book value per common share was $12.08 as of December 31, 2025 compared to $16.48 as of December 31, 2024.

Previous wording

•First Guaranty's Board of Directors declared cash dividends of $0.41 per common share in 2024 and $0.64 per common share in 2023. First Guaranty has paid 126 consecutive quarterly dividends on its common stock as of December 31, 2024.

Current wording

•First Guaranty's Board of Directors declared cash dividends of $0.04 per common share in 2025 and $0.41 per common share in 2024. First Guaranty has paid 130 consecutive quarterly dividends on its common stock as of December 31, 2025.

Previous wording

Our total assets were $4.0 billion at December 31, 2024, an increase of $420.0 million, or 11.8%, from total assets of $3.6 billion at December 31, 2023. Assets increased primarily due to increases in cash and cash equivalents of $277.8 million and investment securities of $198.6 million, partially offset by a decrease in net loans of $58.8 million at December 31, 2024 compared to December 31, 2023.

Current wording

Our total assets were $4.1 billion at December 31, 2025, an increase of $105.6 million, or 2.7%, from total assets of $4.0 billion at December 31, 2024. Assets increased primarily due to increases in cash and cash equivalents of $281.5 million and investment securities of $396.5 million, partially offset by a decrease in net loans of $629.9 million at December 31, 2025 compared to December 31, 2024.

Previous wording

Net loans decreased $58.8 million, or 2.2%, to $2.7 billion at December 31, 2024 from December 31, 2023. Commercial and industrial loans decreased $77.5 million primarily due to paydowns. Construction and land development loans decreased $69.4 million principally due to the conversion of existing loans to permanent financing. Commercial lease loan balances decreased $65.2 million primarily due to paydowns on the existing lease portfolio. First Guaranty's commercial lease portfolio generally has higher yields than commercial real estate loans but shorter average lives. Consumer and other loans decreased $12.2 million primarily due to paydowns. Agricultural loans decreased $0.3 million primarily due to seasonal activity. Farmland loans increased $3.5 million due to seasonal activity. One-to four-family loans increased $5.5 million primarily due to new originations. Multifamily loans increased $46.2 million primarily due to the conversion of existing construction loans to permanent financing and the origination of new loans. Non-farm non-residential loan balances increased $114.0 million primarily due to new originations and the conversion of construction and land development loans to permanent financing. First Guaranty had approximately 3.0% of funded and 1.7% of unfunded commitments in our loan portfolio to businesses engaged in support or service activities for oil and gas operations. First Guaranty's hotel and hospitality portfolio totaled $178.9 million at December 31, 2024. As part of the management of risks in our loan portfolio, First Guaranty had previously established an internal guidance limit of approximately $200.0 million for its hotel and hospitality portfolio. First Guaranty had $407.1 million in loans related to our Texas markets at December 31, 2024 which was an increase of $31.4 million or 8.4% from $375.7 million at December 31, 2023. First Guaranty had $335.5 million in loans related to our new Mideast markets in Kentucky and West Virginia at December 31, 2024 which was an increase of $57.5 million or 20.7% from $278.1 million at December 31, 2023. Syndicated loans at December 31, 2024 were $53.9 million, of which $27.6 million were shared national credits. Syndicated loans decreased $22.8 million from $76.7 million at December 31, 2023.

Current wording

Net loans decreased $629.9 million, or 23.7%, to $2.0 billion at December 31, 2025 from December 31, 2024. First Guaranty adopted a change in its business plan in July 2024 that focused on reducing risk in the balance sheet, including risk associated with the loan portfolio. As part of this strategy, First Guaranty has reduced loan originations, charged-off loan balances and conducted select loan sales, which have each contributed to a decline in loan balances. Non-farm non-residential loan balances decreased $211.3 million primarily due to the sale of loans and payoffs. Construction and land development loans decreased $180.6 million principally due to the sale of loans, charge-offs, and the conversion of existing loans to permanent financing. Commercial lease loan balances decreased $144.6 million primarily due to paydowns on the existing lease portfolio and charge-offs. First Guaranty's commercial lease portfolio generally has higher yields than commercial real estate loans but shorter average lives. Commercial and industrial loans decreased $28.8 million primarily due to paydowns. One-to four-family loans decreased $21.6 million primarily due to paydowns. Multifamily loans decreased $20.9 million primarily due to paydowns and charge-offs. Consumer and other loans decreased $9.2 million primarily due to paydowns. Agricultural loans decreased $5.5 million primarily due to seasonal activity. Farmland loans decreased $3.8 million due to seasonal activity. First Guaranty had approximately 3.3% of funded and 1.7% of unfunded commitments in our loan portfolio to businesses engaged in support or service activities for oil and gas operations. First Guaranty's hotel and hospitality portfolio totaled $157.6 million at December 31, 2025. As part of the management of risks in our loan portfolio, First Guaranty had previously established an internal guidance limit of approximately $200.0 million for its hotel and hospitality portfolio. First Guaranty had $192.6 million in loans related to our Texas markets at December 31, 2025 which was a decrease of $214.4 million or 52.7% from $407.1 million at December 31, 2024. As noted above, First Guaranty has entered into an agreement to sell its Texas operations. First Guaranty had $323.1 million in loans related to our Mideast markets in Kentucky and West Virginia at December 31, 2025 which was a decrease of $12.5 million or 3.7% from $335.5 million at December 31, 2024. Syndicated loans at December 31, 2025 were $50.3 million, of which $21.1 million were shared national credits. Syndicated loans decreased $3.6 million from $53.9 million at December 31, 2024.

Previous wording

As of December 31, 2024, 79.2% of our loan portfolio was secured by real estate. The largest portion of our loan portfolio, at 42.9% as of December 31, 2024, was non-farm non-residential loans secured by real estate. As of December 31, 2024, approximately 53.1% of the loan portfolio was based on a floating rate tied to the prime rate, SOFR or Treasury rates. 46.2% of the loan portfolio is scheduled to mature within five years from December 31, 2024. First Guaranty initiated a process to transfer any LIBOR indexed loans to alternative reference rates such as the prime rate or SOFR as LIBOR was discontinued for repricings after June 30, 2023.

Current wording

As of December 31, 2025, 82.0% of our loan portfolio was secured by real estate. The largest portion of our loan portfolio, at 45.7% as of December 31, 2025, was non-farm non-residential loans secured by real estate. As of December 31, 2025, approximately 57.0% of the loan portfolio was based on a floating rate tied to the prime rate, SOFR or Treasury rates. 39.6% of the loan portfolio is scheduled to mature within five years from December 31, 2025.

Previous wording

Commercial real estate (“CRE”) has received increased regulatory scrutiny in recent quarters due to valuation concerns associated with the increase in market interest rates and the impact of the COVID-19 pandemic. First Guaranty has utilized enhanced risk management practices for CRE concentration analysis for several years. First Guaranty Bank’s credit department conducts an annual stress test for CRE related loans that is presented to the Bank’s board of directors. The stress test analyzes the impact of changes in interest rates and cash flow on loan customers with credit exposures of $2.5 million or greater. First Guaranty generally requires personal guarantees on CRE loans. First Guaranty generally approves CRE loans with loan-to-values of 80% or less. First Guaranty also generally requires for construction related CRE loans that the borrower provides their equity contribution upfront before loan funds are advanced. First Guaranty modified its business strategy in 2024 to reduce exposure to commercial real estate related loans, particularly loans secured by non-owner occupied properties and construction loans for commercial real estate.

Current wording

Commercial real estate (“CRE”) has received increased regulatory scrutiny in recent quarters due to valuation concerns associated with the increase in market interest rates and the impact of the COVID-19 pandemic. First Guaranty has utilized enhanced risk management practices for CRE concentration analysis for several years. First Guaranty Bank’s credit department conducts an annual stress test for CRE related loans that is presented to the Bank’s board of directors. The stress test analyzes the impact of changes in interest rates and cash flow on loan customers with credit exposures of $2.5 million or greater. First Guaranty generally requires personal guaranties on CRE loans. First Guaranty generally approves CRE loans with loan-to-values of 80% or less. First Guaranty also generally requires for construction related CRE loans that the borrower provides their equity contribution upfront before loan funds are advanced. First Guaranty modified its business strategy in 2024 to reduce exposure to commercial real estate related loans, particularly loans secured by non-owner occupied properties and construction loans for commercial real estate. First Guaranty continued this strategy in 2025.

Previous wording

First Guaranty has diversified its CRE portfolio across both industries and geographic location. The following is a summary of the largest CRE related loans associated with hotel and motels, office properties, apartment complexes, healthcare related properties, and properties under construction as of December 31, 2024. The largest CRE loan secured by a hotel or motel totaled $19.9 million. The property is a flagged hotel located in Texas. The largest CRE loan secured by an office related property totaled $21.3 million and is located in West Virginia. The largest CRE loan secured by an apartment complex totaled $26.0 million and is located in Texas. The largest healthcare related loan is a $32.9 million property secured by an assisted living center located in Alabama. The largest CRE loan under construction totaled $40.4 million for an apartment complex and is secured by a property located in Louisiana.

Current wording

First Guaranty has diversified its CRE portfolio across both industries and geographic location. The following is a summary of the largest CRE related loans associated with hotel and motels, office properties, apartment complexes, healthcare related properties, and properties under construction as of December 31, 2025. First Guaranty generally does not finance multi-story office buildings in major metropolitan areas. The largest CRE loan secured by a hotel or motel totaled $19.4 million. The property is a flagged hotel located in Texas. The largest CRE loan secured by an office related property totaled $20.9 million and is located in West Virginia. The largest CRE loan secured by an apartment complex totaled $40.4 million and is located in Louisiana. The largest healthcare related loan is a $33.5 million property secured by an assisted living center located in Alabama. The largest CRE loan under construction totaled $16.6 million for a multipurpose CRE building and is secured by a property located in Louisiana.

Previous wording

Non-performing assets were $120.4 million, or 3.03%, of total assets at December 31, 2024, compared to $41.7 million, or 1.17%, of total assets at December 31, 2023, which represented an increase in non-performing assets of $78.6 million. The increase in non-performing assets occurred primarily due to an increase in nonaccrual loans, partially offset by a decrease in loans 90 days greater delinquent and still accruing and other real estate owned. Nonperforming loans included loans previously classified as purchase credit deteriorated following the adoption of CECL.

Current wording

Non-performing assets were $95.5 million, or 2.34%, of total assets at December 31, 2025, compared to $120.4 million, or 3.03%, of total assets at December 31, 2024, which represented a decrease in non-performing assets of $24.9 million. The decrease in non-performing assets occurred primarily due to a decrease in nonaccrual loans and loans 90 days greater delinquent and still accruing, partially offset by an increase in other real estate owned. Nonperforming loans included loans previously classified as purchase credit deteriorated following the adoption of CECL.

Previous wording

Nonaccrual loans increased from $25.2 million at December 31, 2023 to $108.5 million at December 31, 2024. The increase in total nonaccrual loans was concentrated primarily in non-farm non-residential and multifamily loans. Non-performing assets included $3.9 million in loans with a government guarantee, or 3.24% of non-performing assets. These are structured as net loss guarantees in which up to 90% of loss exposure is covered.

Current wording

Nonaccrual loans decreased from $108.5 million at December 31, 2024 to $59.6 million at December 31, 2025. The decrease in total nonaccrual loans was concentrated primarily in non-farm non-residential and multifamily loans. Non-performing assets included $4.5 million in loans with a government guarantee, or 4.73% of non-performing assets. These are structured as net loss guarantees in which up to 90% of loss exposure is covered.

Previous wording

At December 31, 2024 loans 90 days and greater delinquent and still accruing totaled $11.5 million, a decrease of $3.8 million or 24.8% from $15.3 million at December 31, 2023. The decrease in loans 90 days or greater delinquent and still accruing was concentrated primarily in non-farm non-residential loans.

Current wording

At December 31, 2025 loans 90 days and greater delinquent and still accruing totaled $0.8 million, a decrease of $10.7 million or 93.1% from $11.5 million at December 31, 2024. The decrease in loans 90 days or greater delinquent and still accruing was concentrated primarily in construction and land development and non-farm non-residential loans.

Previous wording

At December 31, 2024, the largest 6 non-performing loan relationships comprise 76% of total non-performing loans. Additional details on the non-performing relationships are as follows:

Current wording

At December 31, 2025, the largest 10 non-performing loan relationships comprise 74% of total non-performing loans. Additional details on the non-performing relationships are as follows:

Previous wording

The increase in classified assets at December 31, 2024 as compared to December 31, 2023 was due to a $96.8 million increase in substandard loans offset by a $1.1 million decrease in doubtful loans. The increase in substandard loans was primarily the result of downgrades during the second quarter of 2024 of two related commercial loan relationships, with balances of $22.3 million and $16.9 million, from pass to substandard status, and one commercial loan relationship totaling $28.7 million downgraded during the third quarter of 2024, from special mention to substandard status, and one multifamily loan totaling $26.0 million downgraded during the fourth quarter of 2024, from special mention to substandard status. The $28.7 million commercial loan relationship was pass status at December 31, 2023. The decrease in doubtful loans was primarily the result of the payoff of a $0.4 million one-to-four family loan classified as doubtful during the first quarter of 2024. Special mention loans increased by $66.9 million in 2024. The increase in special mention loans was primarily the result of downgrade during the third quarter of 2024 of one commercial lease loan relationship totaling $18.1 million, and one downgrade during the fourth quarter of 2024 of one real estate loan relationship totaling $16.0 million, from pass to special mention status.

Current wording

The increase in classified assets at December 31, 2025, as compared to December 31, 2024, was due to a $162.4 million increase in substandard loans and a $9.0 million increase in doubtful loans. The increase in substandard loans was primarily the result of downgrades during the first, third, and fourth quarters of 2025. During the first quarter of 2025, a $15.4 million subdivision development loan and a $14.9 million loan secured by an assisted living center were downgraded from special mention to substandard, and a $13.6 million loan secured by a retail shopping center was downgraded from pass to substandard. During the second quarter of 2025, a $23.5 million hospital loan relationship was downgraded from pass to substandard. During the fourth quarter of 2025, a $46.3 million healthcare-related relationship, a $33.5 million loan relationship primarily secured by owner-occupied office buildings, and a $16.0 million food processing loan relationship were downgraded from pass to substandard. The increase in doubtful loans was driven by to two credit relationships. One relationship consisted of a commercial lease loan to an auto parts manufacturer with an outstanding balance of $5.7 million, which was charged down by $43.4 million in the fourth quarter of 2025. The second relationship was a $3.6 million commercial and industrial loan to a borrower in the legal industry, for which a $3.5 million specific reserve was established as of December 31, 2025. Special mention loans increased by $203.8 million in 2025. The increase in special mention loans was primarily the result of downgrades during the third and fourth quarters of 2025. The largest loan downgraded from pass to special mention in the third quarter of 2025 was a $40.4 million apartment complex loan. The largest loan downgraded from pass to special mention in the fourth quarter of 2025 was a $33.5 million loan secured by an assisted living facility.

Previous wording

The balance in the allowance for credit losses is principally influenced by the provision for credit losses and by net loan loss experience. Additions to the allowance are charged to the provision for credit losses. Losses are charged to the allowance as incurred and recoveries on losses previously charged to the allowance are credited to the allowance at the time recovery is collected. The table below reflects the activity in the allowance for credit losses for the years indicated. As previously disclosed, the adoption of the CECL model in ASC 326 was the cause of most of the increase in the allowance in 2023.

Current wording

The table below reflects the activity in the allowance for credit losses for the years indicated.

Previous wording

A provision for credit losses of $20.0 million was made during the year ended December 31, 2024 and $3.7 million for the same period in 2023. The provisions made in 2024 included a $1.6 million negative provision for credit losses related to unfunded commitments and a $0.1 million provision for credit losses on HTM securities. The provisions made were taken to provide for current credit losses and to maintain the allowance proportionate to risks inherent in the loan portfolio.

Current wording

A provision for credit losses of $81.7 million was made during the year ended December 31, 2025 and $20.0 million for the same period in 2024. The provisions made in 2025 included a $0.5 million negative provision for credit losses related to unfunded commitments. First Guaranty's unfunded commitments declined during 2025 which resulted in a reduced liability. The provisions made were taken to provide for current credit losses and to maintain the allowance proportionate to risks inherent in the loan portfolio.

Previous wording

•Non-farm non-residential loans increased by $114.0 million during 2024. The allowance increase related to this portfolio was due to growth, charge-offs and changes in the qualitative analysis of the portfolio related to economic conditions.

Current wording

•Non-farm non-residential loans decreased by $211.3 million during 2025. The allowance increase related to this portfolio was due to changes in the qualitative analysis of the portfolio related to economic conditions, and a $0.4 million increase in the allowance for loans individually evaluated.

Previous wording

•Consumer and other loans decreased during 2024. The decrease in the related loan loss allowance balance was due primarily to charge-offs and qualitative analysis of the portfolio.

Current wording

•Consumer and other loans decreased $9.2 million during 2025. The decrease in the related loan loss allowance balance was due primarily to charge-offs and changes in the qualitative analysis of the portfolio.

Previous wording

First Guaranty charged off $18.6 million in loan balances during the year ended December 31, 2024 as compared to $5.8 million for 2023. Recoveries totaled $0.9 million for the year ended December 31, 2024 and $1.4 million during 2023. The details of the $18.6 million in charged-off loans were as follows:

Current wording

First Guaranty charged off $77.2 million in loan balances during the year ended December 31, 2025 as compared to $18.6 million for 2024. Recoveries totaled $0.9 million for the year ended December 31, 2025 and $0.9 million during 2024. The details of the $77.2 million in charged-off loans were as follows:

Previous wording

First Guaranty charged off $3.2 million in consumer loans during 2024. The consumer loan charge offs included $0.2 million in credit card loans, $1.3 million of loans secured by automobiles or equipment and $1.7 million in unsecured loans.

Current wording

First Guaranty charged off $1.2 million in consumer loans during 2025. The consumer loan charge-offs included $0.3 million in credit card loans, $0.4 million of loans secured by automobiles or equipment, and $0.5 million in unsecured loans.

Previous wording

First Guaranty charged off $0.3 million on a real estate secured SBA loan during the second quarter of 2024. This loan had a remaining principal balance of $0.9 million at December 31, 2024.

Current wording

First Guaranty charged off $0.3 million on a commercial and industrial loan during the second quarter of 2025. This relationship had no remaining principal balance as of December 31, 2025.

Previous wording

Smaller loans and overdrawn deposit accounts comprised the remaining $3.4 million of charge-offs for 2024.

Current wording

Smaller loans and overdrawn deposit accounts comprised the remaining $2.1 million of charge-offs for 2025.

Previous wording

Investment securities at December 31, 2024 totaled $602.7 million, an increase of $198.6 million, or 49.1%, compared to $404.1 million at December 31, 2023. The portfolio consists of both available for sale (AFS) and held to maturity securities (HTM). The securities designated as held to maturity are agency and corporate debt securities that are part of First Guaranty’s investment strategy and public funds collateralization program. We purchase securities for our investment portfolio to provide a source of liquidity, to provide an appropriate return on funds invested, to manage interest rate risk and meet pledging requirements for public funds and borrowings.

Current wording

Investment securities net of the allowance for credit losses at December 31, 2025 totaled $999.3 million, an increase of $396.5 million, or 65.8%, compared to $602.7 million at December 31, 2024. The portfolio consists of both available for sale (AFS) and held to maturity securities (HTM). The securities designated as held to maturity are agency and corporate debt securities that are part of First Guaranty’s investment strategy and public funds collateralization program. We purchase securities for our investment portfolio to provide a source of liquidity, to provide an appropriate return on funds invested, to manage interest rate risk and meet pledging requirements for public funds and borrowings.

Previous wording

The securities portfolio consisted principally of U.S. Government and Government agency securities, agency mortgage-backed securities, corporate debt securities and municipal bonds. U.S. government agencies consist of FHLB, Federal Farm Credit Bank ("FFCB"), Freddie Mac and Fannie Mae obligations. Mortgage-backed securities that we purchase are issued by Freddie Mac and Fannie Mae. Management monitors the securities portfolio for both credit and interest rate risk. We generally limit the purchase of corporate securities to individual issuers to manage concentration and credit risk. Corporate securities generally have a maturity of 10 years or less. U.S. Government securities consist of U.S. Treasury bills that have maturities of less than 30 days. Government agency securities generally have maturities of 15 years or less. Agency mortgage-backed securities have stated final maturities of 15 to 20 years.

Current wording

The securities portfolio consisted principally of U.S. Government and Government agency securities, agency mortgage-backed securities, corporate debt securities and municipal bonds. U.S. government agencies consist of FHLB, FFCB, Freddie Mac and Fannie Mae obligations. Mortgage-backed securities that we purchase are issued by Freddie Mac and Fannie Mae. Management monitors the securities portfolio for both credit and interest rate risk. We generally limit the purchase of corporate securities to individual issuers to manage concentration and credit risk. Corporate securities generally have a maturity of 10 years or less. U.S. Government securities consist of U.S. Treasury bills that have maturities of less than 30 days. Government agency securities generally have maturities of 15 years or less. Agency mortgage-backed securities have stated final maturities of 15 to 20 years.

Previous wording

At December 31, 2024, the U.S. Government and Government agency securities and municipal bonds qualified as securities available to collateralize public funds. Securities pledged as collateral totaled $233.9 million at December 31, 2024 and $192.2 million at December 31, 2023. Our public funds deposits have a seasonal increase due to tax collections at the end of the year and the first quarter. We typically collateralize the seasonal public fund increases with short term instruments such as U.S. Treasuries or other agency backed securities.

Current wording

At December 31, 2025, the U.S. Government and Government agency securities and municipal bonds qualified as securities available to collateralize public funds. Securities pledged as collateral totaled $695.4 million at December 31, 2025 and $233.9 million at December 31, 2024. Our public funds deposits have a seasonal increase due to tax collections at the end of the year and the first quarter. We typically collateralize the seasonal public fund increases with short term instruments such as U.S. Treasuries or other agency backed securities.

Previous wording

Our available for sale securities portfolio totaled $281.1 million at December 31, 2024, an increase of $197.6 million, or 236.7%, compared to $83.5 million at December 31, 2023. The increase was primarily due to the purchase of U.S. Treasury securities, collateralized mortgage obligations, and mortgage-backed securities.

Current wording

Our available for sale securities portfolio totaled $676.6 million at December 31, 2025, an increase of $395.5 million, or 140.7%, compared to $281.1 million at December 31, 2024. The increase was primarily due to the purchase of collateralized mortgage obligations and mortgage-backed securities. In the third and fourth quarter of 2025, First Guaranty has primarily purchased U.S. Government securities and U.S. Government mortgage-backed and collateralized mortgage obligations.

Previous wording

Our held to maturity securities portfolio had an amortized cost of $321.6 million, net of allowance at December 31, 2024, compared to $320.6 million at December 31, 2023.

Current wording

Our held to maturity securities portfolio had an amortized cost of $322.7 million, net of allowance at December 31, 2025, compared to $321.6 million at December 31, 2024.

Previous wording

There were no credit related impairment of available for sale securities during 2024. There were no charge-offs recorded during 2024. There was a provision of $0.1 million recorded in the fourth quarter of 2024. The allowance for credit losses for held to maturity securities was $0.2 million at December 31, 2024.

Current wording

There were no credit related impairment of available for sale securities during 2025. There were no charge-offs recorded during 2025. There was a provision of $0.1 million recorded in the fourth quarter of 2024. The allowance for credit losses for held to maturity securities was $0.2 million at December 31, 2025 and December 31, 2024.

Previous wording

At December 31, 2024, $153.8 million, or 25.5%, of the securities portfolio was scheduled to mature in less than one year. Securities, not including mortgage-backed securities and collateralized mortgage obligations, with contractual maturity dates over 10 years totaled $182.2 million, or 30.2%, of the total portfolio at December 31, 2024. We closely monitor the investment portfolio's yield, duration, and maturity to ensure a satisfactory return. The average maturity of the securities portfolio is affected by call options that may be exercised by the issuer of the securities and are influenced by market interest rates. Prepayments of mortgages that collateralize mortgage-backed securities also affect the maturity of the securities portfolio.

Current wording

At December 31, 2025, $105.5 million, or 10.6%, of the securities portfolio was scheduled to mature in less than one year. Securities, not including mortgage-backed securities and collateralized mortgage obligations, with contractual maturity dates over 10 years totaled $162.6 million, or 16.3%, of the total portfolio at December 31, 2025. We closely monitor the investment portfolio's yield, duration, and maturity to ensure a satisfactory return. The average maturity of the securities portfolio is affected by call options that may be exercised by the issuer of the securities and are influenced by market interest rates. Prepayments of mortgages that collateralize mortgage-backed securities also affect the maturity of the securities portfolio.