FB Financial Corp
For the period ended Dec 31, 2025. Filed Feb 26, 2026.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2025 · Filed Feb 26, 2026
FBK$54.17-0.2%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2024-12-31; filed 2025-02-25.
0001649749-25-000035
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2025-12-31; filed 2026-02-26.
0001649749-26-000012
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 238 previous paragraphs and 254 current paragraphs.
117 unchanged; 79 reworded; 51 added; 39 removed; 3 previous and 7 current paragraphs rearranged.
Tables are not compared: 35 previous and 34 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (51)
Current report
Developments in 2025
Current report
Mergers and acquisitions
Current report
Southern States Bancshares, Inc.
Current report
On July 1, 2025, the Company completed its merger with Southern States Bancshares, Inc. and its wholly-owned subsidiary, Southern States Bank, with FB Financial Corporation continuing as the surviving entity. This merger strengthens the Company’s presence in existing markets, such as Birmingham and Huntsville, Alabama, while expanding the Company’s footprint further into Alabama and Georgia. The Company acquired total assets of $2.83 billion, total loans of $2.27 billion and assumed total deposits of $2.47 billion. Under the terms of the agreement, each outstanding share of Southern States common stock was converted into the right to receive 0.80 shares of the Company’s stock. Additionally, fractional shares and outstanding stock options were settled in cash. As a result, total consideration paid was $368.4 million based on the Company’s closing stock price of $45.30 per share on June 30, 2025. The merger resulted in additional goodwill of $107.8 million being recorded based on preliminary fair value estimates of total net assets acquired and liabilities assumed in the transaction.
Current report
During the year ended December 31, 2025, net interest income increased to $516.1 million compared with $416.5 million in the year ended December 31, 2024. Our net interest margin, on a tax-equivalent basis, increased to 3.81% for the year ended December 31, 2025 as compared to 3.51% for the year ended December 31, 2024. The increase in net interest income and net interest margin, on a tax-equivalent basis, reflects a $109.1 million increase in interest income, partially offset by a $8.8 million increase in interest expense.
Current report
Provision for credit losses on loans HFI and unfunded loan commitments was $43.3 million for the year ended December 31, 2025 compared $12.0 million for the year ended December 31, 2024 primarily due to the initial provision for credit losses on acquired loans and unfunded commitments from the Southern States merger of $28.4 million, along with changes in loan balances and forecast assumptions. Refer to Note 2, “Mergers and acquisitions” in this Report for further discussion around the merger with Southern States.
Current report
Noninterest expense increased to $378.2 million for the year ended December 31, 2025, compared with $296.9 million for the year ended December 31, 2024. The increase in noninterest expense was driven by a $33.9 million increase in salaries, commissions and employee benefits due to increased headcount resulting from the Southern States merger, combined with increase in performance-based compensation driven by improvement in the Company’s performance metrics, $23.8 million in merger and integration costs associated with our merger with Southern States and an increase in other noninterest expense of $16.3 million due to increases in franchise tax expense, technology and platform fees, and modest increases across a range of other expense categories.
Current report
Income tax expense for the year ended December 31, 2025 was $15.9 million compared to $30.6 million for the year ended December 31, 2024. The change reflects the income tax effect of a $60.5 million loss on sale of AFS debt securities, as well as a one-time gross tax benefit of $10.7 million due to the expiration of the statute of limitations with respect to an amended income tax return and the associated interest for the year ended December 31, 2025. Income tax expense for the year ended December 31, 2024, included the income tax effect of a $56.4 million loss on sale of AFS debt securities.
Current report
Noninterest expense for the years ended December 31, 2025 and 2024 was $53.5 million and $50.4 million, respectively. This increase is reflective of an increase in commissions associated with mortgage loan volume.
Current report
Net interest income increased $100.3 million to $519.4 million for the year ended December 31, 2025 as compared to $419.1 million for the year ended December 31, 2024. Net interest margin was 3.81% for the year ended December 31, 2025 compared to 3.51% for the year ended December 31, 2024. Net interest income was broadly driven by higher average balances of loans held for investment resulting from the Southern States merger.
Current report
Interest income was $837.2 million for the year ended December 31, 2025, compared to $728.1 million for the year ended December 31, 2024, an increase of $109.1 million. The increase in interest income was primarily attributable to loans HFI, which increased $101.9 million to $724.7 million for the year ended December 31, 2025 from $622.8 million for the year ended December 31, 2024. The increase was driven by higher average balances of loans held for investment resulting from the Southern States merger, partially offset by a lower overall yield on those loans due to declining interest rates. The yield on loans HFI decreased 6 basis points to 6.58% for the year ended December 31, 2025 from 6.64% for the year ended December 31, 2024.
Current report
Accretion on purchased loans contributed 10 basis points to the NIM for the year ended December 31, 2025 as a result of the recent merger. There was no impact of accretion on purchased loans to the NIM for the year ended December 31, 2024.
Current report
Interest income on investment securities was the next largest contributor to the overall change in interest income, increasing $7.1 million to $63.6 million for the year ended December 31, 2025 from $56.5 million for the year ended December 31, 2024. This increase was driven by higher yields on investment securities stemming from previous portfolio restructuring transactions. The yield on investment securities was 3.97% and 3.39% for the years ended December 31, 2025 and 2024, respectively, an increase of 58 basis points.
Current report
Interest expense was $317.8 million for the year ended December 31, 2025, an increase of $8.8 million as compared to $309.0 million for the year ended December 31, 2024. The increase was driven by higher average interest‑bearing deposit balances resulting from the recent merger, mostly offset by declines in the rates paid on interest‑bearing deposits and other borrowed funds.
Current report
Interest expense on interest-bearing deposit accounts totaled $309.2 million for the year ended December 31, 2025, an increase of $12.9 million from the prior year, largely due to increases in average balances across most deposit categories, particularly money market deposits. Lower rates paid across these categories partially offset this increase. The growth in average balances was attributable to the recent merger and to a lesser extent recent customer deposit campaigns, which increased deposit balances while reducing deposit costs. The average rate paid on interest-bearing deposits was 3.09% for the year ended December 31, 2025 compared to 3.49% for the year ended December 31, 2024.
Current report
Interest expense recognized on other borrowings decreased $4.6 million for the year ended December 31, 2025 due to the repayment of the Bank Term Funding Program which was paid off during the third quarter of 2024.
Current report
Beginning with June 30, 2025, we began to utilize the discounted cash flow estimation technique, adjusted for current conditions and reasonable and supportable forecasts, to estimate the expected credit losses of its loan segments, except consumer and other loans, which utilized the weighted average remaining maturity loss rate technique. We determined that the use of the updated estimate techniques and related inputs and assumptions enhances the transparency, accuracy and relevance of information relating to the allowance for credit losses through the application of data and calculations more clearly calibrated to our historical experience, the nature of our loan portfolio and unfunded commitments, and expectations for future economic conditions and corresponding expected credit losses.
Current report
These changes represent a change in accounting estimate under ASC 250, “Accounting Changes and Error Corrections”, and, accordingly, is applied prospectively in the period of change and did not have a material effect on the Company’s financial statements. See “Note 1, “Basis of presentation and summary of significant accounting policies” in this Report for further discussion on the change in estimate.
Current report
The discounted cash flow was calibrated using a regression analysis that relates one or more economic variables to our historical default rates and selected peer banks for each loan segment. We determined that national unemployment, national housing price index, national commercial real estate index and prime rates were the key economic variables that were most correlated to our historical loss performance and our peer banks. Reasonable and supportable forecasts of these economic indicators are utilized within the discounted cash flow to estimate expected credit losses for each loan segment. Current and forecast economic conditions, including those affecting these and other economic variables or macroeconomic conditions, such as global conflicts or tariffs, may continue to lead to increased volatility in our calculated level of allowance for credit losses.
Current report
Prior to the changes described above, our estimates for credit losses calculation utilized lifetime loss rate model and included economic forecasts for unemployment, gross domestic product, as well as other macroeconomic events which may impact our loan portfolio. Refer to Note 1, “Basis of presentation and summary of significant accounting policies” in the Company's Annual Report on Form 10-K for the year ended December 31, 2024, for a detailed discussion regarding ACL methodology.
Current report
We recorded a provision for credit losses on unfunded commitments of $10.1 million and a reversal of $2.7 million for the years ended December 31, 2025 and 2024, respectively. For the year ended December 31, 2025, the increase in provision for credit losses on unfunded commitments was due largely to the $6.5 million impact of the change in the CECL loss estimation methodology combined with $3.2 million for the initial provision on acquired unfunded commitments associated with the Southern States merger. The reversal of provision for credit losses on unfunded commitments for the year ended December 31, 2024 was primarily due to management’s concentrated effort to reduce unfunded loan commitments during the period.
Current report
Mortgage banking income includes origination fees, gains and losses on the sale of mortgage loans, changes in fair value of mortgage loans and related derivatives, as well as mortgage servicing income, which includes the change in fair value of MSRs and related derivatives. Mortgage banking income was $52.4 million for the year ended December 31, 2025, an increase of $5.8 million compared to the prior period. The increase includes an increase from gains on sale and related fair value changes of $5.0 million to $38.7 million in the current period compared to $33.7 million in the prior period. This was impacted by the increase in interest rate lock volume of $196.7 million, or 13.5% during the current period over the same period in the prior year.
Current report
Investment services and trust income is comprised of wealth management fees and trust and insurance income. This caption increased $2.1 million during the year ended December 31, 2025 to $16.3 million as compared to $14.2 million during the year ended December 31, 2024. This growth was driven primarily by higher fees resulting from increased assets under management in existing accounts, supported by favorable market conditions.
Current report
Other income is comprised of income recognized that does not typically fit into other income categories and includes components such as BOLI income, swap fees, and equity investments income. Other income decreased $2.5 million to $9.6 million during the year ended December 31, 2025 as compared to $12.1 million during the year ended December 31, 2024. This decrease was primarily driven by a $2.3 million loss associated with an equity method investment during the year ended December 31, 2025.
Current report
Occupancy and equipment expense includes occupancy, depreciation and equipment expense. Occupancy and equipment expense of $28.1 million and $26.3 million was recognized for the years ended December 31, 2025 and 2024. The increase was driven by the expansion of our branch network in connection with the Southern States merger.
Current report
Merger and integration costs include costs associated with the merger, integration and conversion of business combinations. Merger and integration costs were $23.8 million for the year ended December 31, 2025 associated with the merger with Southern States. These costs primarily include legal and professional fees, severance and other employee-related costs, and costs associated with branch consolidation, conversion and integration activities.
Current report
Other noninterest expense increased $16.3 million during the year ended December 31, 2025 to $75.8 million compared to $59.6 million during the year ended December 31, 2024. The increase was attributable to a $4.7 million increase in franchise tax expense, a $2.4 million increase of technology and platform fees and modest increases across a range of other expense categories, including software license and maintenance fees, card transaction fees, contributions and dues, servicing fees and other operating expenses.
Current report
Income tax expense was $15.9 million and $30.6 million for the years ended December 31, 2025 and 2024, respectively. This represents effective tax rates of 11.5% and 20.9% for the years ended December 31, 2025 and 2024, respectively. The primary differences between the effective tax rates and the enacted federal statutory rate was primarily driven by a one‑time gross tax benefit of $10.7 million related to the expiration of the statute of limitations associated with an amended income tax return and related interest, as well as interest income on tax refunds and tax‑exempt municipal interest income, net of interest disallowance. These favorable impacts were partially offset by applicable state income taxes and certain non‑deductible expenses, including limitations under Section 162(m) limitations.
Current report
For the year ended December 31, 2025, income tax expense also reflects the income tax effect of a $60.5 million loss on sale of AFS debt securities. For the year ended December 31, 2024, income tax expense included the income tax effect of loss on sale of AFS debt securities of $56.4 million. Refer to Note 13 “Income taxes” in the notes to the consolidated financial statements for additional information regarding our income tax expense and effective tax rates.
Current report
(1) Nonperforming loans are those on which the accrual of interest has stopped, as well as loans that are contractually 90 or more days past due on which interest continues to accrue.
Current report
Nonperforming loans are those on which the accrual of interest has stopped, as well as loans that are contractually 90 days or more past due on which interest continues to accrue.
Current report
Beginning with June 30, 2025, we began to utilize the discounted cash flow estimation technique, adjusted for current conditions and reasonable and supportable forecasts, to estimate the expected credit losses of its loan segments, except consumer and other loans, which utilized the weighted average remaining maturity loss rate technique. We determined that the use of the updated estimate techniques and related inputs and assumptions enhances the transparency, accuracy and relevance of information relating to the allowance for credit losses through the application of data and calculations more clearly calibrated to our historical experience, the nature of our loan portfolio and unfunded commitments, and expectations for future economic conditions and corresponding expected credit losses. See “Note 1, “Basis of presentation and summary of significant accounting policies” in this Report for further discussion on the change in estimate. The changes are accounted for as a change in estimate included in the provision for credit losses for the year ended December 31, 2025 and did not have a material impact to our operating results and financial condition.
Current report
Prior to June 30, 2025, our estimates for credit losses calculation utilized a lifetime loss rate model. See Note 1, “Basis of presentation and summary of significant accounting policies,” in the notes to our consolidated financial statements in our Annual Report that was filed with the SEC on February 25, 2025, for additional information regarding our estimates prior to June 30, 2025.
Current report
(1) Includes the impact of changes to estimation techniques, inputs and assumptions used to estimate credit losses during the year ended December 31, 2025. See “Note 1, “Basis of presentation and summary of significant accounting policies” in this Report for further discussion on the change in estimate.
Current report
(1) Includes the impact of changes to estimation techniques, inputs and assumptions used to estimate credit losses during the year ended December 31, 2025. See “Note 1, “Basis of presentation and summary of significant accounting policies” in this Report for further discussion on the change in estimate.
Current report
Our ratio of total nonperforming loans HFI as a percentage of total loans HFI increased by 10 basis points to 0.97% as of December 31, 2025 compared to December 31, 2024 primarily due to increases in nonperforming loans in our construction, multi-family, consumer and other and 1-4 family mortgages portfolios partially offset by a decrease in our commercial and industrial portfolio.
Current report
For the year ended December 31, 2025, we experienced net charge-offs of $6.7 million, or 0.06% of average loans HFI, compared to net charge-offs of $13.1 million, or 0.14% for the year ended December 31, 2024. We also maintain an allowance for credit losses on unfunded commitments in other liabilities, which increased to $16.2 million as of December 31, 2025 from $6.1 million as of December 31, 2024 due primarily to the change in CECL loss estimation methodology and the initial provision from unfunded commitments acquired in the Southern States merger.
Current report
During the year ended December 31, 2025, we sold $266.9 million of AFS debt securities, resulting in a loss on securities of $60.5 million. We used the proceeds from this transaction to redeem outstanding subordinated and trust preferred debt, as well as originate higher yielding loans. During the same period, maturities, prepayments and calls of AFS debt securities totaled $301.0 million and purchases totaled $421.5 million.
Current report
Equity securities, at fair value
Current report
As of December 31, 2025, we had $0.2 million in marketable equity securities recorded at fair value that were acquired through our merger with Southern States. The change in the fair value of equity securities recorded at fair value resulted in a net gain of $14 thousand for the year ended December 31, 2025. Subsequent to December 31, 2025, the remaining marketable equity securities were sold.
Showing the first 40 of 51 passages. Open the source sections for the rest.
Removed paragraphs (39)
Previous report
(1)Book value per share equals our total common shareholders’ equity divided by the number of shares of our common stock outstanding as of the date presented.
Previous report
(3)ROAA and ROAE is calculated by dividing net income or loss for that period by our average assets or average equity for the same period.
Previous report
During the year ended December 31, 2023, net interest income decreased to $407.2 million compared with $412.2 million in the year ended December 31, 2022. Our net interest margin, on a tax-equivalent basis, decreased to 3.44% for the year ended December 31, 2023 as compared to 3.57% for the year ended December 31, 2022, influenced by rising interest rates increasing our total cost of funds compared to the increase in the interest income on interest-earning assets during the year ended December 31, 2023.
Previous report
Provision for credit losses on loans HFI and unfunded loan commitments was $2.5 million for the year ended December 31, 2023 compared $19.0 million for the year ended December 31, 2022 primarily due to a reversal of provision for credit losses on unfunded commitments of $14.2 million compared to provision expense of $8.6 million during the year ended December 31, 2022. Refer to the section “Provision for credit losses” for additional information.
Previous report
Noninterest income for the year ended December 31, 2023 decreased by $44.1 million to $70.5 million, down from $114.7 million for prior year period. The decrease in noninterest income was primarily driven by a decrease in mortgage banking income of $28.9 million to $44.7 million for the year ended December 31, 2023, compared to $73.6 million for the prior year period. These results were impacted by increasing interest rates, compressing margins and a decrease in demand for residential mortgages experienced through the industry during the year ended December 31, 2023 compared with the year ended December 31, 2022. The change was also impacted by the restructuring of our mortgage business, including the exit of our direct-to-consumer internet delivery channel during the year ended December 31, 2022. Additionally contributing to the decrease in noninterest income during the year ended December 31, 2023 was a $14.0 million net loss on investment securities primarily related to the sale of $100.5 million of AFS securities. Refer to the section “Other earning assets” for additional information on the sale of the AFS securities.
Previous report
Noninterest expense decreased to $324.9 million for the year ended December 31, 2023, compared with $348.3 million for the year ended December 31, 2022. The decrease in noninterest expense is reflective of the $28.3 million decrease in salaries, commissions and employee-related costs namely in the Mortgage segment related to the restructuring of our Mortgage segment, reduced headcount and mortgage production. Additionally, this decrease in salaries, commission and employee-benefit related costs was partially offset by an $8.4 million increase in early retirement, severance and other costs related to our efficiency and scalability initiatives and $4.7 million in regulatory fees and assessments, which includes a $1.8 million FDIC special assessment associated with the bank failures earlier in 2023. Additionally, the decrease in noninterest expense reflects $12.5 million in mortgage restructuring expenses included in expenses in the year ended December 31, 2022.
Previous report
Noninterest expense for the years ended December 31, 2024 and 2023 was $49.8 million and $54.8 million, respectively. This decrease is reflective of a decrease in salaries and employee benefits associated with our efficiency and scalability initiatives.
Previous report
Net interest income increased $8.5 million to $419.1 million for the year ended December 31, 2024 as compared to $410.6 million for the year ended December 31, 2023. Increases in interest income of $46.4 million were largely offset by increases in interest expense of $37.8 million for the year ended December 31, 2024 compared to the prior period. The increase in interest income for the current year period was driven by an increase in yields on average earning assets which reached 6.10% in the current year, as compared to 5.72% in the prior year. The increase in interest expense was due to both an increase in the rate paid on interest-bearing liabilities, which increased to 3.53% from 3.16%, and an increase in the average balance of interest-bearing liabilities of $151.0 million.
Previous report
Interest income on loans HFI increased $26.8 million to $622.8 million for the year ended December 31, 2024 from $596.0 million for the year ended December 31, 2023 due primarily to increasing yields. The average yield on loans HFI increased by 26 basis points period-over-period to 6.64% for the year ended December 31, 2024 from 6.38% for the year ended December 31, 2023.
Previous report
Interest income on taxable investment securities increased $22.8 million to $50.1 million for the year ended December 31, 2024 from $27.3 million for the year ended December 31, 2023 due to the reinvestment of proceeds from the sale of AFS debt securities that were sold during the second half of 2023 and first and third quarters of 2024 to higher yielding U.S. government agency securities and mortgage-backed securities. The yield on taxable investment securities increased 142 basis points to 3.41% for the year ended December 31, 2024 compared to 1.99% for the year ended December 31, 2023.
Previous report
Interest expense was $309.0 million for the year ended December 31, 2024, an increase of $37.8 million as compared to $271.2 million for the year ended December 31, 2023. The increase was largely attributed to a rise in the rate paid on interest-bearing deposit accounts, most notably, on money market and customer time deposit products. Total cost of interest-bearing deposits was 3.49% for the year ended December 31, 2024 compared to 3.08% for the year ended December 31, 2023.
Previous report
Interest expense on money market deposits increased $20.9 million to $147.1 million for the year ended December 31, 2024 compared to $126.2 million for the year ended December 31, 2023. The average rate on money market deposits increased 31 basis points to 3.84% for the year ended December 31, 2024 from 3.53% for the year ended December 31, 2023. Interest expense on customer time deposits increased $10.3 million to $55.5 million for the year ended December 31, 2024 from $45.3 million for the year ended December 31, 2023. The average rate on customer time deposits increased 82 basis points to 3.97% for the year ended December 31, 2024 from 3.15% for the year ended December 31, 2023.
Previous report
The average balance of other borrowings increased $94.0 million to $97.2 million for the year ended December 31, 2024 compared to $3.2 million for the year ended December 31, 2023. As a result, interest expense on other borrowings increased to $4.7 million for the year ended December 31, 2024 compared to $116 thousand for the year ended December 31, 2023. The yield on other borrowings increased 122 basis points to 4.82% for the year ended December 31, 2024 compared to 3.60% for the year ended December 31, 2023. The increase is due primarily to borrowings from the Bank Term Funding Program, which was paid-off during the year ended December 31, 2024. Refer to the section “Borrowings” for additional information on the BTFP.
Previous report
We recorded a reversal of provision for credit losses on unfunded commitments of $2.7 million and $14.2 million for the years ended December 31, 2024 and 2023, respectively. The reversal of provision for credit losses on unfunded commitments for the years ended December 31, 2024 and 2023 is primarily due to management's concentrated effort to reduce unfunded loan commitments during the periods indicated including a $227.7 million and a $913.2 million decrease in our construction category for the years ended December 31, 2024 and 2023, respectively. Decreases in commitment balances for construction and commercial real estate were partially offset by increases in commercial and industrial and residential segments. Decreases in commitment balances for construction resulted in a $2.6 million and $14.2 million decrease in ACL for the years ended December 31, 2024 and 2023, respectively.
Previous report
Mortgage banking income primarily includes origination fees and realized gains and losses on the sale of mortgage loans, unrealized change in fair value of mortgage loans and derivatives, and mortgage loan servicing fees, which includes the net change in fair value of MSRs and related derivatives. Mortgage banking income was $46.6 million, an increase of $1.9 million compared to the prior year.
Previous report
Investment services and trust income is comprised of wealth management fees and trust and insurance income. Investment services and trust income increased $2.9 million during the year ended December 31, 2024 to $14.2 million as compared to $11.3 million during the year ended December 31, 2023. The increase is primarily attributable to fees earned from higher assets under management stemming from market value improvement and existing account growth, as well as customer acquisition efforts through a mix of financial advisors joining the Company bringing new business and the addition of new accounts by the financial advisors already at the Company.
Previous report
Other income is comprised of income recognized that does not typically fit into one of the other noninterest income categories and includes primarily BOLI income, swap fees, equity investment income, and prior to 2024, change in fair value of commercial loans held for sale. Other income increased $6.0 million to $12.1 million during the year ended December 31, 2024 as compared to $6.1 million during the year ended December 31, 2023. This increase was primarily related to a $2.1 million increase in BOLI income resulting from proceeds from payment of death benefits during the year ended December 31, 2024, an $1.9 million increase in equity investments income and a $2.1 million loss recorded during the year ended December 31, 2023 associated with the change in fair value of the commercial loans held for sale portfolio that was exited during the year ended December 31, 2023.
Previous report
Occupancy and equipment expense includes occupancy, depreciation and equipment expense. Occupancy and equipment expense decreased $1.9 million during the year ended December 31, 2024 to $26.3 million as compared to $28.1 million during the year ended December 31, 2023. The decrease was primarily driven by a $1.8 million loss on lease terminations primarily associated with branch closures recognized during the year ended December 31, 2023.
Previous report
Mortgage restructuring expense is related to the exit from our direct-to-consumer internet delivery channel during the year ended December 31, 2022. This expense primarily included salaries, commissions and employee benefits expense, including severance and the acceleration of vesting on restricted stock units. Other components of this expense included software license and maintenance fees, an impairment of our operating lease right-of-use assets and a loss on disposal of fixed assets.
Previous report
Other noninterest expense primarily includes mortgage servicing expenses, regulatory fees and deposit insurance assessments, software license and maintenance fees and various other miscellaneous expenses. Other noninterest expense decreased $3.7 million during the year ended December 31, 2024 to $59.6 million compared to $63.3 million during the year ended December 31, 2023. The decrease was primarily related to a $4.4 million decrease in franchise tax expense.
Previous report
Income tax expense was $30.6 million and $30.1 million for the years ended December 31, 2024 and 2023, respectively. This represents effective tax rates of 20.9% and 20.0% for the years ended December 31, 2024 and 2023, respectively. The primary differences from the enacted Federal rates are applicable state income taxes and certain expenses that are not deductible, reduced for non-taxable income. Refer to Note 12 “Income taxes” in the notes to the consolidated financial statements for additional information regarding the Company’s income tax expense and effective tax rates.
Previous report
Of the loans shown above with floating interest rates as of December 31, 2024, many have interest rate floors as follows:
Previous report
As of both December 31, 2024 and 2023, other real estate owned included $0.1 million of excess land and facilities held for sale resulting from our prior acquisitions. Other repossessed assets also included other repossessed non-real estate amounting to $2.4 million and $1.1 million as of December 31, 2024 and 2023, respectively.
Previous report
We calculate our expected credit loss using a lifetime loss rate methodology. We utilize probability-weighted forecasts, which consider multiple macroeconomic variables that are applicable to each type of loan. See “Critical Accounting Estimates - Allowance for credit losses” and Note 3 “Loans and allowance for credit losses” in the notes to the consolidated financial statements for additional information regarding our methodology.
Previous report
For the year ended December 31, 2024, we experienced net charge-offs of $13.1 million, or 0.14% of average loans HFI, compared to net charge-offs of $0.6 million, or 0.01% for the year ended December 31, 2023. The increase was driven by a $10.5 million full charge-off of a single commercial and industrial relationship during the year ended December 31, 2024. Our ratio of total nonperforming loans HFI as a percentage of total loans HFI increased by 22 basis points to 0.87% as of December 31, 2024 compared to December 31, 2023. See above within this section for further information related to this increase.
Previous report
Management has made a concerted effort to reduce exposure to construction lending during year ended December 31, 2024. The reduction in construction balances and the corresponding allowance reduction offset some of the additional allowance needed related to growth in other loan segments.
Previous report
We also maintain an allowance for credit losses on unfunded commitments in other liabilities, which decreased to $6.1 million as of December 31, 2024 from $8.8 million as of December 31, 2023 due to a 4.30% or $124.6 million decrease in unfunded loan commitments during the period. The decrease in the allowance for credit losses on unfunded commitment was driven primarily as a result of management’s concentrated effort to reduce unfunded loan commitments, namely in our construction category.
Previous report
Total deposits were $11.21 billion and $10.55 billion as of December 31, 2024 and 2023, respectively. Noninterest-bearing deposits at December 31, 2024 and 2023 were $2.12 billion and $2.22 billion, respectively which include mortgage escrow deposits which increased to $69.0 million as of December 31, 2024 from $63.6 million as of December 31, 2023. Our interest-bearing deposits were $9.09 billion and $8.33 billion at December 31, 2024 and 2023, respectively.
Previous report
The decrease in our noninterest-bearing deposits from December 31, 2024 to December 31, 2023 was due to a migration to interest-yielding products such as interest-bearing checking deposits, which increased by $402.0 million. In addition, customers also migrated to money market and savings deposits accounts which increased by $133.6 million from December 31, 2023.
Previous report
Our deposits from municipal and governmental entities, also known as public funds, decreased by $43.0 million during the period within the interest-bearing checking category. The decrease in public funds was largely due to management's decision over the period to not renew certain maturing public deposits.
Previous report
Additionally, customer time deposits decreased by $89.6 million from December 31, 2023 which was largely driven by management's decision not to renew certain maturing deposits given the change in market interest rates.
Previous report
Brokered and internet time deposits increased by $318.3 million to $469.1 million as of December 31, 2024 compared to December 31, 2023. The increase was driven by an issuance of brokered deposits of $369.1 million at an average coupon of 4.15% as we took advantage of favorable relative terms available during the second half of the year ended December 31, 2024.
Previous report
During the year ended December 31, 2023, we sold $100.5 million of AFS debt securities. The sales contributed to a pre-tax loss on securities of $14.0 million. We primarily sold collateralized mortgage obligations, U.S. government agency securities and municipal securities. We reinvested the proceeds from the sales primarily into U.S. government agency AFS debt securities in order increase the effective yield of our portfolio. Including the reinvestment of these proceeds, we purchased $202.1 million of AFS debt securities during the year ended December 31, 2023 and had maturities and calls of securities which totaled $128.2 million.
Previous report
FHLB short-term advances
Previous report
Bank Term Funding Program
Previous report
In March 2023, the Federal Reserve established the Bank Term Funding Program to make available funding to eligible depository institutions in order to help assure they have the ability to meet the needs of their depositors following the March 2023 high-profile bank failures. The program allows for advances for up to one year secured by eligible high-quality securities at par value extended at the one-year overnight index swap rate, plus 10 basis points, as of the day the advance is made. The interest rate is fixed for the term of the advance and there are no prepayment penalties. The BTFP ceased extending new borrowings on March 11, 2024. As of December 31, 2023, we had outstanding borrowings of $130.0 million under the BTFP at a borrowing rate of 4.85%. During the year ended December 31, 2024, we repaid the $130.0 million borrowings in full.
Previous report
During the year ended December 31, 2003, we formed two separate trusts which issued $9.0 million and $21.0 million of floating rate trust preferred securities as part of a pooled offering of such securities. We issued junior subordinated debentures of $9.3 million, which included proceeds of common securities which we purchased for $0.3 million, and junior subordinated debentures of $21.7 million which included proceeds of common securities of $0.7 million. The trusts were created for the sole purpose of issuing 30-year capital trust preferred securities to fund the purchase of junior subordinated debentures issued by us. Both issuances were to the trusts in exchange for the proceeds of the securities offerings, which represent the sole asset of the trusts.
Previous report
Additionally, during the year ended December 31, 2020, we placed $100.0 million of ten year fixed-to-floating rate subordinated notes, maturing September 1, 2030. The Company mitigated interest rate exposure associated with these notes through the use of fair value hedging instruments. The fair value hedge matured during the year ended December 31, 2024. See Note 15, "Derivatives" for additional details related to these instruments.
Previous report
Shareholders’ equity and capital management
Reworded paragraphs (79)
Previous wording
We are a financial holding company headquartered in Nashville, Tennessee. We operate primarily through our wholly-owned bank subsidiary, FirstBank. FirstBank provides a comprehensive suite of commercial and consumer banking services to clients in select markets in Tennessee, Kentucky, Alabama and North Georgia. As of December 31, 2024, our footprint included 77 full-service branches serving the following Tennessee Metropolitan Statistical Areas: Nashville, Chattanooga (including North Georgia), Knoxville, Memphis, and Jackson in addition to Bowling Green, Kentucky and Birmingham, Florence and Huntsville, Alabama. We also provide banking services to 17 community markets throughout Tennessee, Alabama and North Georgia. During the year ended December 31, 2024, the Company announced expansions into the Tuscaloosa, Alabama and Asheville, North Carolina markets. FirstBank also provides mortgage banking services utilizing its bank branch network and mortgage banking offices strategically located throughout the southeastern United States. As of December 31, 2024, we had total assets of $13.16 billion, loans held for investment of $9.60 billion, total deposits of $11.21 billion, and total shareholders’ equity of $1.57 billion.
Current wording
We are a financial holding company headquartered in Nashville, Tennessee. We operate primarily through our wholly-owned subsidiary bank, FirstBank, and its subsidiaries. FirstBank provides a comprehensive suite of commercial and consumer banking services to clients in select markets in Tennessee, Alabama, Kentucky, Georgia and North Carolina. As of December 31, 2025, our footprint included 90 full-service branches serving markets across Tennessee, including Nashville, Chattanooga, Knoxville, Memphis, and Jackson in addition to Bowling Green, Kentucky, Columbus and Newnan, Georgia and Birmingham, Anniston, Huntsville, and Auburn, Alabama. Additionally, our banking services extend to community markets throughout our footprint. FirstBank also provides retail mortgage banking services utilizing its bank branch network and mortgage banking offices strategically located throughout the southeastern United States. As of December 31, 2025, we had total assets of $16.30 billion, loans held for investment of $12.38 billion, total deposits of $13.91 billion, and total shareholders’ equity of $1.95 billion.
Previous wording
We operate through two segments, Banking and Mortgage. We generate most of our revenue in our Banking segment from interest on loans and investments, loan-related fees, trust and investment services and deposit-related fees. Our primary source of funding for our loans is customer deposits, and, to a lesser extent, unsecured credit lines, brokered deposits, and other borrowings. We generate most of our revenue in our Mortgage segment from origination fees and gains on sales in the secondary market of mortgage loans, as well as from mortgage servicing revenues.
Current wording
We operate through two segments, Banking and Mortgage. We generate most of our revenue in our Banking segment from interest on loans and investments, loan-related fees, trust and investment services and deposit-related fees. Our primary source of funding for our loans is customer deposits, however we have other sources of funds including unsecured credit lines, brokered CDs, and other borrowings. We generate most of our revenue in our Mortgage segment from origination fees and gains on sales in the secondary mortgage loan market, as well as from mortgage servicing revenues.
Previous wording
Net interest income is the largest contributor to our net income and is the difference between the interest and fees earned on interest-earning assets (primarily loans, investment securities and interest-bearing deposits with other financial institutions) and the interest expense incurred in connection with interest-bearing liabilities (primarily deposits and borrowings). The level of net interest income is primarily a function of the average balance of interest-earning assets, the average balance of interest-bearing liabilities and the spread between the contractual yield on such assets and the contractual cost of such liabilities. These factors are influenced by both the pricing and mix of interest-earning assets and interest-bearing liabilities which, in turn, are impacted by external factors such as local economic conditions, competition for loans and deposits, the monetary policy of the Federal Reserve Board and market interest rates.
Current wording
Net interest income is the largest contributor to our net income and is the difference between the interest and fees earned on interest-earning assets (primarily loans, investment securities and interest-bearing deposits with other financial institutions) and the interest expense incurred in connection with interest-bearing liabilities (primarily deposits and borrowings). The level of net interest income is primarily a function of the average balance of interest-earning assets, the average balance of interest-bearing liabilities and the spread between the contractual yield on such assets and the contractual cost of such liabilities. These factors are influenced by both the pricing and mix of interest-earning assets and interest-bearing liabilities which, in turn, are impacted by external factors such as local economic conditions, competition for loans and deposits, the monetary policy of the Federal Reserve and market interest rates.
Previous wording
Interest rates increased throughout the year ended December 31, 2024. Volatile interest rates could have significant adverse effects on the earnings, financial condition and results of operations of the Company.
Current wording
Interest rates decreased throughout the year ended December 31, 2025. Volatile interest rates could have significant adverse effects on the earnings, financial condition and results of operations of the Company.
Previous wording
For additional information regarding our interest rate risks factors and management, see “Business: Risk management:
Current wording
For additional information regarding our interest rate risks factors and management, see “Business: Risk management: Liquidity and interest rate risk management” and “Risk factors: Risks related to our business.”
Previous wording
During 2024, our percentage of total nonperforming loans to loans HFI increased to 0.87% as of December 31, 2024, from 0.65% as of December 31, 2023. Our classified loans increased to 1.15% of loans HFI as of December 31, 2024, compared to 0.74% as of December 31, 2023. Our nonperforming assets as of December 31, 2024 were $121.9 million, or 0.93% of total assets compared to $86.5 million, or 0.69% of assets as of December 31, 2023.
Current wording
During 2025, our percentage of total nonperforming loans to loans HFI increased to 0.97% as of December 31, 2025, from 0.87% as of December 31, 2024. Our classified loans decreased incrementally to 1.10% of loans HFI as of December 31, 2025, compared to 1.15% as of December 31, 2024. Our nonperforming assets as of December 31, 2025 were $158.1 million, or 0.97% of total assets compared to $121.9 million, or 0.93% of assets as of December 31, 2024.
Previous wording
Our provisions for credit losses resulted in an expense of $12.0 million for the year ended December 31, 2024 compared to $2.5 million for the year ended December 31, 2023. For the year ended December 31, 2024, our provision for credit losses was comprised of $14.7 million of provision for credit losses on loans HFI and $2.7 million related to reversals of credit losses on unfunded commitments. The current period expense is the result of changes to the overall loan portfolio, including both growth and changes in portfolio composition, an increase in net charge-offs and slight deterioration in economic forecasts which impacted our loss estimation process. These evaluations weighed the impact of the current economic outlook, including unemployment and gross domestic product, as well as macroeconomic events which may impact our loan portfolio, such as supply chain concerns and global conflicts. See further discussion under the subheading “Allowance for credit losses.”
Current wording
Our provisions for credit losses resulted in an expense of $43.3 million for the year ended December 31, 2025 compared to $12.0 million for the year ended December 31, 2024. For the year ended December 31, 2025, our provision for credit losses was comprised of $33.2 million of provision for credit losses on loans HFI and $10.1 million related to credit losses on unfunded commitments. The current period expense is the result of a $28.4 million initial provision related to Southern States acquired loans HFI and unfunded commitments and regular changes in loan balances and forecasts inputs. See further discussion under the subheading “Provision for credit losses.”
Previous wording
We are subject to extensive regulation and supervision, which continue to evolve as the legal and regulatory framework governing our operations continues to change. The current operating environment also has heightened supervisory expectations in areas such as consumer compliance, BSA and anti-money laundering compliance, risk management and internal audit. We expect to incur increased costs for compliance, risk management and audit personnel or professional fees associated with advisors and consultants due the current economic environment.
Current wording
We are subject to extensive regulation and supervision, which continue to evolve as the legal and regulatory framework governing our operations continues to change. The current operating environment also has heightened supervisory expectations in areas such as consumer compliance, BSA and anti-money laundering compliance, risk management and internal audit.
Previous wording
(2)Non-GAAP financial measure; See "GAAP reconciliation and management explanation of non-GAAP financial measures” and non-GAAP reconciliations herein.
Current wording
(1)Non-GAAP financial measure; See“GAAP reconciliation and management explanation of non-GAAP financial measures” and non-GAAP reconciliations herein.
Previous wording
(4)Includes$31.4 million, $21.2 million and $26.2 million of optional rights to repurchase GNMA loans that meet certain defined delinquency criteria as of December 31, 2024, 2023 and 2022, respectively.
Current wording
(2)Includes$28.1 million, $31.4 million and $21.2 million of optional rights to repurchase GNMA loans that meet certain defined delinquency criteria as of December 31, 2025, 2024 and 2023, respectively.
Previous wording
The core efficiency ratio (tax-equivalent basis) is a non-GAAP measure that excludes certain gains (losses), merger and offering-related expenses and other selected items. Our management uses this measure in its analysis of our performance. Our management believes this measure provides a greater understanding of ongoing operations and enhances comparability of results with prior periods, as well as demonstrates the effects of significant gains and charges. The most directly comparable financial measure calculated in accordance with GAAP is the efficiency ratio.
Current wording
The adjusted efficiency ratio (tax-equivalent basis) is a non-GAAP measure that excludes certain gains (losses), merger and offering-related expenses and other selected items. Our management uses this measure in its analysis of our performance. Our management believes this measure provides a greater understanding of ongoing operations and enhances comparability of results with prior periods, as well as demonstrates the effects of significant gains and charges. The most directly comparable financial measure calculated in accordance with GAAP is the efficiency ratio.
Previous wording
The following table presents, as of the dates set forth below, a reconciliation of our core efficiency ratio (tax-equivalent basis) to our efficiency ratio:
Current wording
The following table presents, as of the dates set forth below, a reconciliation of our adjusted efficiency ratio (tax-equivalent basis) to our efficiency ratio:
Previous wording
Our net income decreased during the year ended December 31, 2023 to $120.2 million from $124.6 million for the year ended December 31, 2022. Diluted earnings per common share was $2.57 and $2.64 for the years ended December 31, 2023 and 2022, respectively. Our net income represented a return on average assets of 0.95% and 1.01% for the years ended December 31, 2023 and 2022, respectively, and a return on average equity of 8.74% and 9.23% for the same periods. Our ratio of return on average tangible common equity for the years ended December 31, 2023 and 2022 was 10.7% and 11.4%, respectively. See “GAAP reconciliation and management explanation of non-GAAP financial measures” in this Report for a discussion of tangible common equity and return on average tangible common equity.
Current wording
Our net income increased during the year ended December 31, 2025 to $122.6 million from $116.1 million for the year ended December 31, 2024. Diluted earnings per common share was $2.45 and $2.48 for the years ended December 31, 2025 and 2024, respectively. Our net income represented a return on average assets of 0.84% and 0.91% for the years ended December 31, 2025 and 2024, respectively, and a return on average equity of 6.90% and 7.71% for the same periods. Our ratio of return on average tangible common equity for the years ended December 31, 2025 and 2024 was 8.40% and 9.24%, respectively. See “GAAP reconciliation and management explanation of non-GAAP financial measures” in this Report for a discussion of tangible common equity and return on average tangible common equity.
Previous wording
Our net income decreased during the year ended December 31, 2024 to $116.1 million from $120.2 million for the year ended December 31, 2023. Diluted earnings per common share was $2.48 and $2.57 for the years ended December 31, 2024 and 2023, respectively. Our net income represented a return on average assets of 0.91% and 0.95% for the years ended December 31, 2024 and 2023, respectively, and a return on average equity of 7.71% and 8.74% for the same periods. Our ratio of return on average tangible common equity for the years ended December 31, 2024 and 2023 was 9.2% and 10.7%, respectively. See “GAAP reconciliation and management explanation of non-GAAP financial measures” in this Report for a discussion of tangible common equity and return on average tangible common equity.
Current wording
Our net income decreased during the year ended December 31, 2024 to $116.1 million from $120.2 million for the year ended December 31, 2023. Diluted earnings per common share was $2.48 and $2.57 for the years ended December 31, 2024 and 2023, respectively. Our net income represented a return on average assets of 0.91% and 0.95% for the years ended December 31, 2024 and 2023, respectively, and a return on average equity of 7.71% and 8.74% for the same periods. Our ratio of return on average tangible common equity for the years ended December 31, 2024 and 2023 was 9.24% and 10.7%, respectively. See “GAAP reconciliation and management explanation of non-GAAP financial measures” in this Report for a discussion of tangible common equity and return on average tangible common equity.
Previous wording
Provision for credit losses on loans HFI and unfunded loan commitments was $12.0 million for the year ended December 31, 2024 compared $2.5 million for the year ended December 31, 2023 primarily due to a reversal of provision for credit losses on unfunded commitments of $2.7 million compared to $14.2 million during the year ended December 31, 2023. Refer to the section “Provision for credit losses” for additional information.
Current wording
Provision for credit losses on loans HFI and unfunded loan commitments was $12.0 million for the year ended December 31, 2024 compared to $2.5 million for the year ended December 31, 2023 primarily due to a reversal of provision for credit losses on unfunded commitments of $2.7 million compared to $14.2 million during the year ended December 31, 2023.
Previous wording
Noninterest income for the year ended December 31, 2024 decreased by $31.5 million to $39.1 million, down from $70.5 million for prior year period. The decrease in noninterest income was driven by a $56.4 million net loss on investment securities related to the sale of $526.4 million of AFS securities compared to a $14.0 million net loss on investment securities primarily related to the sale of $100.5 million of AFS securities for the year ended December 31, 2023. Refer to the section “Other earning assets” for additional information on the sale of the AFS securities. The decrease was partially offset by a $2.9 million increase in investment services and trust income, a $2.1 million increase in BOLI income resulting from proceeds from payment of death benefits, and a $1.9 million increase in equity investments income. Additionally, during the year ended December 31, 2023, a $2.1 million loss was recorded associated with the change in fair value of the commercial loans held for sale portfolio that was exited during the year ended December 31, 2023.
Current wording
Noninterest income for the year ended December 31, 2024 decreased by $31.5 million to $39.1 million, down from $70.5 million for prior year period. The decrease in noninterest income was driven by a $56.4 million net loss on investment securities related to the sale of $526.4 million of AFS securities compared to a $14.0 million net loss on investment securities primarily related to the sale of $100.5 million of AFS securities for the year ended December 31, 2023. The decrease was partially offset by a $2.9 million increase in investment services and trust income, a $2.1 million increase in BOLI income resulting from proceeds from payment of death benefits, and a $1.9 million increase in equity investments income. Additionally, during the year ended December 31, 2023, a $2.1 million loss was recorded associated with the change in fair value of the commercial loans held for sale portfolio that was exited during the year ended December 31, 2023.
Previous wording
We operate our business in two business segments: Banking and Mortgage. See Note 1, “Basis of presentation” and Note 18 “Segment reporting” in the notes to our consolidated financial statements for a description of these business segments.
Current wording
We operate our business in two business segments: Banking and Mortgage. See Note 1, “Basis of presentation and summary of significant accounting policies” and Note 19 “Segment reporting” in the notes to our consolidated financial statements for a description of these business segments.
Previous wording
Income before taxes from the Banking segment decreased for the year ended December 31, 2024 to $143.1 million, compared to $154.3 million for the year ended December 31, 2023. Net interest income increased by $9.5 million to $410.8 million during the year ended December 31, 2024 compared to $401.2 million during the year ended December 31, 2023. Provisions for credit losses on loans HFI and unfunded loan commitments resulted in $12.3 million of provision expense during the year ended December 31, 2024 compared to $2.6 million during the year ended December 31, 2023. The Banking segment recorded a noninterest loss of $8.4 million in the year ended December 31, 2024 as compared to income of $25.8 million in the year ended December 31, 2023. This decrease includes a net loss on investment securities of $56.4 million associated with the sale of $526.4 million AFS debt securities during the year ended December 31, 2024 compared with a net loss on investment securities of $14.0 million primarily related to the sale of $100.5 million of AFS debt securities for the year ended December 31, 2023. Noninterest expense decreased to $247.1 million for year ended December 31, 2024 compared to $270.1 million for the year ended December 31, 2023 due to decreases in salaries, occupancy, advertising, legal and professional fees and franchise tax expense.
Current wording
Income before taxes from the Banking segment decreased for the year ended December 31, 2025 to $134.9 million, compared to $143.7 million for the year ended December 31, 2024. Net interest income increased by $95.3 million to $506.1 million during the year ended December 31, 2025 compared to $410.8 million during the year ended December 31, 2024. Provisions for credit losses on loans HFI and unfunded loan commitments resulted in $37.6 million of provision expense during the year ended December 31, 2025 compared to $12.3 million during the year ended December 31, 2024. The increase was driven by the initial provision for credit losses on acquired loans and unfunded commitments from the Southern States merger of $28.4 million. The Banking segment recorded a noninterest loss of $8.8 million in the year ended December 31, 2025 as compared to a loss of $8.4 million in the year ended December 31, 2024. This decrease includes a net loss on investment securities of $60.5 million associated with the sale of $266.9 million AFS debt securities during the year ended December 31, 2025 compared with a net loss on investment securities of $56.4 million primarily related to the sale of $526.4 million of AFS debt securities for the year ended December 31, 2024. Noninterest expense increased to $324.8 million for year ended December 31, 2025 compared to $246.5 million for the year ended December 31, 2024 due toincreases in salaries and benefits, merger and integration costs associated with the Southern States merger, advertising, franchise tax expense, technology and platform fees and modest increases across a range of other expense categories.
Previous wording
Activity in our Mortgage segment resulted in a pre-tax net contribution of $3.6 million for the year ended December 31, 2024 compared to a $4.1 million pre-tax net loss for the year ended December 31, 2023. Net interest income was $5.7 million for the year ended December 31, 2024 compared to $6.0 million for the year ended December 31, 2023. Provisions for credit losses on loans HFI and unfunded loan commitments resulted in a reversal of $0.3 million of provision expense during the year ended December 31, 2024 compared to a reversal of $0.1 million of provision expense during the year ended December 31, 2023. Mortgage banking income increased $1.9 million to $46.6 million during the year ended December 31, 2024 compared to $44.7 million for the year ended December 31, 2023.
Current wording
Activity in our Mortgage segment resulted in income before income taxes of $3.6 million for the year ended December 31, 2025 compared to $3.0 million for the year ended December 31, 2024. Net interest income was $10.0 million for the year ended December 31, 2025 compared to $5.7 million for the year ended December 31, 2024. Provisions for credit losses on loans HFI and unfunded loan commitments resulted in $5.6 million of provision expense during the year ended December 31, 2025 compared to a reversal of $0.3 million of provision expense during the year ended December 31, 2024. The increase in provisions for credit losses was due to a change in the CECL loss estimation methodology, which notably impacted reserves on our 100% financed 1-to-4 mortgage portfolio, as well as a notable change in forecasts associated with home prices which impacted mortgage reserves more broadly. Mortgage banking income increased $5.8 million to $52.4 million during the year ended December 31, 2025 compared to $46.6 million for the year ended December 31, 2024.
Previous wording
Throughout the following discussion of our operating results, we present our net interest income, net interest margin and core efficiency ratio on a fully tax-equivalent basis. The fully tax-equivalent basis adjusts for the tax-favored status of net interest income from certain loans and investments.
Current wording
Throughout the following discussion of our operating results, we present our net interest income, net interest margin and core efficiency ratio on a fully tax-equivalent basis. The fully tax-equivalent basis adjusts for the tax-favored status of net interest income from certain qualifying loans and investments.
Previous wording
During the year ended December 31, 2024, the U.S. Treasury yield curve continued its path towards normalization with steepening in the intermediate and longer term sectors of the yield curve as the Federal Reserve cut short-term interest rates 100 basis points near the end of the year and longer term yields increased. This is in contrast to the inverted U.S. Treasury yield curve exhibited during the year ended December 31, 2023. The Federal Funds Target Rate range was 4.25% - 4.50% and 5.25% - 5.50% as of December 31, 2024 and December 31, 2023, respectively.
Current wording
During the year ended December 31, 2025, the U.S. Treasury yield curve continued its path toward normalization, with steepening in the intermediate and longer‑term sectors of the curve as the Federal Reserve reduced short‑term interest rates by a total of 75 basis points over the course of the year, and longer‑term yields remained elevated due to ongoing inflation concerns and fiscal conditions. This compares to the year ended December 31, 2024, when the curve was just beginning to normalize following late‑year short‑term rate cuts and an uptick in longer‑term yields. The Federal Funds Target Rate range was 3.50% - 3.75% and 4.25% - 4.50% as of December 31, 2025 and December 31, 2024, respectively.
Previous wording
(2)Interest income includes the effects of taxable-equivalent adjustments using a U.S. federal income tax rate and, where applicable, state income tax to increase tax-exempt interest income to a tax-equivalent basis. The net tax-equivalent adjustment amounts included in income were $2.6 million, $3.3 million, and $3.0 million for years ended December 31, 2024, 2023, and 2022, respectively.
Current wording
equivalent basis. to increase tax-exempt interest income to a tax-equivalent basis. The net tax-equivalent adjustment amounts included in income were $3.3 million, $2.6 million, and $3.3 million for
Previous wording
(3)Includes average net unrealized losses on investment securities available for sale of $166.1 million, $231.5 million, and $144.3 million for the years ended December 31, 2024, 2023, and 2022, respectively.
Current wording
(3)Includes average net unrealized losses on investment securities available for sale of $94.0 million, $166.1 million, and $231.5 million for the years ended December 31, 2025, 2024, and 2023, respectively.
Previous wording
(4)Includes average of optional rights to repurchase government guaranteed GNMA mortgage loans previously sold that meet certain defined delinquency criteria of $24.6 million, $21.7 million, and $13.1 million for the years ended December 31, 2024, 2023, and 2022, respectively.
Current wording
(4)Includes average of optional rights to repurchase government guaranteed GNMA mortgage loans previously sold that meet certain defined delinquency criteria of $25.2 million, $24.6 million, and $21.7 million for the years ended December 31, 2025, 2024, and 2023, respectively.
Previous wording
(5)The NIM is calculated by dividing net interest income, on a tax-equivalent basis, by average total earning assets.
Current wording
(5)The NIM is calculated by dividing annualized net interest income, on a tax-equivalent basis, by average total earning assets.
Previous wording
(2)Interest income includes the effects of the tax-equivalent adjustments to increase tax-exempt interest income to a tax-equivalent basis. The net taxable-equivalent adjustment amounts included was $3.3 million, and $3.0 million for the years ended December 31, 2023 and 2022, respectively.
Current wording
(2)Interest income includes the effects of the tax-equivalent adjustments to increase tax-exempt interest income to a tax-equivalent basis. The net taxable-equivalent adjustment amounts included was $3.3 million and $2.6 million for the years ended December 31, 2025 and 2024, respectively.
Previous wording
The provision for credit losses charged to operating expense is an amount which, in the judgment of management, is necessary to maintain the allowance for credit losses at an appropriate level under the current expected credit loss model. The determination of the amount of the allowance is complex and involves a high degree of judgment and subjectivity. Refer to Note 1, “Basis of presentation” in the notes to our consolidated financial statements for a detailed discussion regarding ACL methodology.
Current wording
The provision for credit losses charged to operating expense is an amount which, in the judgment of management, is necessary to maintain the allowance for credit losses at an appropriate level under the current expected credit loss model. The determination of the amount of the allowance is complex and involves a high degree of judgment and subjectivity.
Previous wording
Our allowance for credit losses calculation as of December 31, 2024 and 2023 resulted from management’s best estimate of losses over the life of loans and unfunded commitments in our portfolio in accordance with the CECL approach. Our calculation as of December 31, 2024 included economic forecasts for unemployment, gross domestic product, as well as other macroeconomic events which may impact our loan portfolio, such as supply chain concerns and global conflicts. These factors may continue to lead to increased volatility in forecasted macroeconomic variables, a key input to our calculated level of allowance for credit losses.
Current wording
Our allowance for credit losses calculation as of December 31, 2025 resulted from management’s best estimate of losses over the life of loans and unfunded commitments in our portfolio in accordance with the CECL approach.
Previous wording
We recognized a provision for credit losses on loans HFI for the years ended December 31, 2024 and 2023 of $14.7 million and $16.7 million, respectively. The current period provision on loans HFI is due to growth in loan balances for most loan categories, an increase in net charge-offs and slight deterioration in economic forecasts offset by significant decreases in construction lending. For the year ended December 31, 2023, the current period provision on loans HFI was impacted by three commercial and industrial relationships moving to nonaccrual status and the deteriorating economic forecasts.
Current wording
We recognized a provision for credit losses on loans HFI for the years ended December 31, 2025 and 2024 of $33.2 million and $14.7 million, respectively. The current period provision on loans HFI was driven by a $25.1 million initial provision on acquired non-PCD loans HFI from the Southern States merger and regular changes in loan balances and forecast inputs offset by a $6.8 million reduction from the impact of the change in the CECL loss estimation methodology. For the year ended December 31, 2024, the provision on loans HFI is due to growth in loan balances for most loan categories, an increase in net charge-offs and slight deterioration in economic forecasts offset by significant decreases in construction lending.
Previous wording
Noninterest income amounted to $39.1 million for the year ended December 31, 2024, a decrease of $31.5 million, or 45%, as compared to $70.5 million for the year ended December 31, 2023. The decrease in total noninterest income was driven by the net loss from investment securities and net loss on write-downs of premises and equipment, offset by increases in investment services and trust income and other noninterest income.
Current wording
Noninterest income amounted to $43.9 million for the year ended December 31, 2025, an increase of $4.8 million, as compared to income of $39.1 million for the year ended December 31, 2024. The increase in total noninterest income was driven by increases in mortgage banking income, investment services and trust income and service charges on deposits offset by the net loss from investment securities and decreases in other income.
Previous wording
Service charges on deposit accounts include overdraft fees, account analysis fees and other customer transaction-related service charges. Service charges on deposit accounts increased $1.1 million during the year ended December 31, 2024 to $13.2 million as compared to $12.2 million during the year ended December 31, 2023.
Current wording
Service charges on deposit accounts include overdraft fees, account analysis fees and other customer transaction-related service charges. Service charges on deposit accounts increased $1.9 million during the year ended December 31, 2025 to $15.1 million as compared to $13.2 million during the year ended December 31, 2024. The increase was primarily due to the increase in deposit accounts from the Southern States merger.
Previous wording
ATM and interchange fees represent income related to customers' utilization of their debit cards and interchange income. ATM and interchange fees were $11.5 million for the year ended December 31, 2024, compared to $10.3 million for the year ended December 31, 2023.
Current wording
ATM and interchange fees represent income related to customers' utilization of their debit cards and interchange income. ATM and interchange fees were $12.1 million for the year ended December 31, 2025, compared to $11.5 million for the year ended December 31, 2024.
Previous wording
Net loss from investment securities was $56.4 million for the year ended December 31, 2024 compared to a net loss of $14.0 million for the year ended December 31, 2023. The net loss from investment securities during the year ended December 31, 2024 stemmed from the sale of $526.4 million of AFS debt securities while the net loss in the prior year primarily related to the sale of $100.5 million of AFS debt securities during that period. The proceeds from the investment securities sales in both years were reinvested into higher yielding AFS securities. Refer to the section “Other earning assets” for additional information on the sale of the AFS debt securities.
Current wording
Net loss from investment securities was $60.5 million for the year ended December 31, 2025 compared to $56.4 million for the year ended December 31, 2024. The net loss from investment securities during the year ended December 31, 2025 was the result of management's election to sell $266.9 million of AFS debt securities compared to $526.4 million of AFS debt securities sold during the prior year period. Refer to the section “Other earning assets” for additional information on the sale of the AFS debt securities.
Previous wording
Net loss on sales or write-downs of premises and equipment, other real estate owned and other assets was $2.2 million for the year ended December 31, 2024 compared to $27 thousand for the year ended December 31, 2023. The loss on sales or write-downs of premises and equipment, other real estate owned and other assets during the year ended December 31, 2024 is primarily due to a $2.3 million impairment charge on two facilities which will be decommissioned.
Current wording
Net loss on sales or write-downs of premises and equipment, other real estate owned and other assets increased $1.0 million for the year ended December 31, 2025. The increase was driven by a $2.3 million impairment charge on two decommissioned facilities recognized during the year ended December 31, 2024, offset by a $1.0 million increase in losses on sales and write downs of other real estate owned and other assets during the year ended December 31, 2025.
Previous wording
Noninterest expense decreased by $28.0 million, or 9%, during the year ended December 31, 2024 to $296.9 million as compared to $324.9 million in the year ended December 31, 2023. The decrease in noninterest expense was attributable to decreases in salaries and employee benefits, occupancy expense, legal and professional fees, advertising, and other noninterest expense.
Current wording
Noninterest expense increased by $81.3 million, or 27.4%, during the year ended December 31, 2025 to $378.2 million as compared to $296.9 million in the year ended December 31, 2024. The increase in noninterest expense was attributable to increases in salaries and employee benefits, merger and integration costs associated with the Southern States merger and other noninterest expense.
Previous wording
Salaries, commissions and employee benefits expense is comprised of salaries and wages in addition to other employee benefit costs and represents the largest component of noninterest expense. For the year ended December 31, 2024, salaries, commissions and employee benefits expense decreased $19.6 million, or 10%, to $183.8 million as compared to $203.4 million for the year ended December 31, 2023. This change was attributable to the impact of the Company’s efficiency and scalability initiatives, partially offset by increases to incentive expense recognized as a result of the Company's overall performance. Additionally contributing to this decrease was a $10.3 million decrease from the Company applying an updated deferral methodology for loan fees and loan origination expenses.
Current wording
Salaries, commissions and employee benefits expense is comprised of salaries and wages in addition to other employee benefit costs and represents the largest component of noninterest expense. Salaries, commissions and employee benefits expense increased $33.9 million, or 18.4%, to $217.7 million for the year ended December 31, 2025 as compared to $183.8 million for the year ended December 31, 2024. This change was driven by increases in the salaries and benefit costs due to increased headcount resulting from the Southern States merger, combined with an increase in performance-based compensation driven by improvement in the Company’s performance metrics.
Previous wording
Data processing is comprised of all third-party core operating system and processing charges as well as payroll processing. Data processing fees were $9.6 million for the year ended December 31, 2024, compared to $9.2 million for the year ended December 31, 2023.
Current wording
Data processing is comprised of all third-party core operating systems and processing charges as well as payroll processing. Data processing fees were $9.7 million for the year ended December 31, 2025, compared to $9.6 million for the year ended December 31, 2024.
Previous wording
Advertising includes expenses related to sponsorships, advertising, marketing, customer relations and business development and public relations. During the year ended December 31, 2024, advertising expense decreased $1.3 million to $7.0 million compared to $8.3 million during the year ended December 31, 2023. This decrease was primarily attributable to marketing rebate activity with partners earned through higher transaction volumes during the year ended December 31, 2024 compared to the year ended December 31, 2023.
Current wording
Advertising includes expenses related to sponsorships, advertising, marketing, customer relations and business development and public relations. During the year ended December 31, 2025, advertising expense increased $2.6 million to $9.6 million compared to $7.0 million during the year ended December 31, 2024. This increase was primarily attributable to customer marketing campaigns during year ended December 31, 2025 combined with favorable, volume based marketing rebate activity recorded in the prior year period.
Previous wording
Legal and professional fees represent fees incurred for the various support functions, which includes legal, consulting, outsourcing and other professional related fees. Legal and professional fees decreased by $1.2 million during the year ended December 31, 2024 to $7.7 million as compared to $8.9 million during the year ended December 31, 2023. The decrease was primarily driven by the completion of internal projects in the prior year.
Current wording
Legal and professional fees represent fees incurred for the various support functions, which includes legal, consulting, outsourcing and other professional related fees. Legal and professional fees were $8.1 million and $7.7 million for the years ended December 31, 2025 and 2024, respectively.
Previous wording
Amortization of core deposit and other intangibles were $2.9 million for the year ended December 31, 2024, compared to $3.7 million for the year ended December 31, 2023.
Current wording
Amortization of core deposit and other intangibles was $5.3 million for the year ended December 31, 2025, compared to $2.9 million for the year ended December 31, 2024. The increase was primarily due to $3.0 million of amortization associated with the core deposit intangible assumed with the merger of Southern States.
Showing the first 40 of 79 pairs. Open the source sections for the rest.
Rearranged current paragraphs (7)
Current report — wording carried from elsewhere
Adjusted efficiency ratio (tax-equivalent basis)
Current report — wording carried from elsewhere
Noninterest income for the year ended December 31, 2025 increased by $4.8 million to $43.9 million, up from $39.1 million for prior year period. The increase in noninterest income was driven by a $5.8 million increase in mortgage banking income, a $2.1 million increase in investment services and trust income and a $1.9 million increase in service charges on deposits. The increase was partially offset by a $60.5 million net loss on investment securities primarily related to the sale of $266.9 million of AFS securities compared to a $56.4 million net loss on investment securities primarily related to the sale of $526.4 million of AFS securities for the year ended December 31, 2024. Refer to the section “Other earning assets” for additional information on the sale of the AFS securities.
Current report — wording carried from elsewhere
Year ended December 31, 2025 compared to the year ended December 31, 2024
Current report — wording carried from elsewhere
(2)Interest income includes the effects of taxable-equivalent adjustments using the combined federal and blended state statutory income tax rate to increase tax-exempt interest income to a tax-
Current report — wording carried from elsewhere
years ended December 31, 2025, 2024, and 2023, respectively.
Current report — wording carried from elsewhere
Year ended December 31, 2025 compared to year ended December 31, 2024
Current report — wording carried from elsewhere
Additional sources of liquidity include federal funds purchased, repurchase agreements, FHLB borrowings, Federal Reserve Discount Window borrowings and lines of credit. Interest is charged at the prevailing market rate on federal funds purchased, reverse repurchase agreements and FHLB advances, and at the Federal Reserve’s primary credit rate for Discount Window borrowings.
Rearranged previous paragraphs (3)
Previous report — wording carried elsewhere
Liquidity and interest rate risk management” and “Risk factors: Risks related to our business.”
Previous report — wording carried elsewhere
Core efficiency ratio (tax-equivalent basis)
Previous report — wording carried elsewhere
The table below provides a summary of our non-owner occupied commercial real estate and construction loan portfolios by collateral property type.