BUSINESS COMBINATIONS

12 Months Ended

Dec. 31, 2024

NOTE 2 – BUSINESS COMBINATIONS

At close of business on February 9, 2024, the Company acquired 100% of the outstanding common shares of Rockhold BanCorp ("Rockhold"), the holding company of the Bank of Kirksville (“BOK”), based in Kirksville, Missouri. Results of operations of BOK were included in the Company’s results of operations beginning February 10, 2024. Acquisition-related costs associated with this acquisition were $3,420 ($2,597 on an after-tax basis) and are included in merger expense in the Company’s income statement for the year ended December 31, 2024.

Information necessary to recognize the fair value of assets acquired and liabilities assumed is complete. The acquisition was and expansion to the Company's current footprint in Missouri with the addition of eight branch locations in the Kirksville area.

The following table summarizes the amounts of assets acquired and liabilities assumed by BOK on February 9, 2024.


Fair value of consideration:
Cash	$	44,304
	$	44,304
Recognized amounts of identifiable assets acquired and liabilities assumed:
Cash and due from banks	$	105,218
Available-for-sale securities		164,629
Loans		118,131
Premises and equipment		3,473
Core deposit intangibles		11,530
Other assets		3,255
Total assets acquired		406,236
Deposits		349,777
Federal funds purchased and retail repurchase agreements		8,818
Interest payable and other liabilities		2,037
Total liabilities assumed		360,632
Total identifiable net assets		45,604
Bargain purchase gain		(1,300	)
	$	44,304

The following tables reconcile the par value of BOK loan portfolio as of the purchase date to the fair value indicated in the table above. For non-purchase credit deteriorated assets, the entire fair value adjustment including both interest and credit related components is recorded as an adjustment to par (“Fair Value Marks”) and reflected as an adjustment to the carrying value of that asset

within the Consolidated Balance Sheet. Following purchase, an ACL is also established for these non-purchase credit deteriorated assets which is not reflected in this table as it is accounted for outside of the business combination. For purchase-credit deteriorated assets, as required by CECL, the fair value mark is divided between an adjustment to par (“Non-Credit Rate Marks”) and an addition to the ACL (“Credit Marks in ACL”). The addition to ACL is based on the application of management’s CECL methodology to the individual loans.


Non-Purchase Credit Deteriorated Loans	Loan Par Value		Fair Value Marks			Purchase Price
Commercial real estate	$	1,959	$	(85	)	$	1,874
Commercial and industrial		32,300		(578	)		31,722
Residential real estate		42,318		(1,182	)		41,136
Agricultural		37,641		(949	)		36,692
Consumer		1,373		(36	)		1,337
Total non-PCD loans	$	115,591	$	(2,830	)	$	112,761

Purchase Credit Deteriorated Loans	Loan Par Value		Fair Value Marks			Credit Marks in ACL			Purchase Price
Commercial and industrial	$	1,366	$	(178	)	$	(119	)	$	1,069
Residential real estate		2,044		(210	)		(183	)		1,651
Agricultural		3,316		(472	)		(284	)		2,560
Consumer		115		(15	)		(10	)		90
Total PCD loans	$	6,841	$	(875	)	$	(596	)	$	5,370


Total Purchased Loans	Purchase Price
Non-Purchase Credit Deteriorated Loans	$	112,761
Purchase Credit Deteriorated Loans		5,370
Total loans	$	118,131

At close of business on July 1, 2024, the Company acquired 100% of the outstanding common shares of KansasLand Bancshares, Inc. ("KansasLand"), the holding company of KansasLand Bank (“KSL”), which has two branch locations in Quinter and Americus, Kansas. Results of operations of KSL were included in the Company’s results of operations beginning July 2, 2024. Acquisition-related costs associated with this acquisition were $1,041 ($791 on an after-tax basis) and are included in merger expense in the Company’s income statement for the year ended December 31, 2024.

Information necessary to recognize the fair value of assets acquired and liabilities assumed is currently still on-going. The acquisition was and expansion to the Company's current footprint in Western Kansas with the addition of two branch locations.

The following table summarizes the amounts of assets acquired and liabilities assumed by KSL on July 1, 2024.


Fair value of consideration:
Cash	$	100
	$	100
Recognized amounts of identifiable assets acquired and liabilities assumed:
Cash and due from banks	$	1,361
Available-for-sale securities		20,004
Loans		27,926
Premises and equipment		372
Core deposit intangibles		506
Other assets		1,764
Total assets acquired		51,933
Deposits		42,418
Federal funds purchased and retail repurchase agreements		780
Federal Home Loan Bank advances		7,049
Bank Stock Loan		691
Interest payable and other liabilities		64
Total liabilities assumed		51,002
Total identifiable net assets		931
Bargain purchase gain		(831	)
	$	100

The following tables reconcile the par value of KSL loan portfolio as of the purchase date to the fair value indicated in the table above. For non-purchase credit deteriorated assets, the entire fair value adjustment including both interest and credit related components is recorded as an adjustment to par (“Fair Value Marks”) and reflected as an adjustment to the carrying value of that asset within the Consolidated Balance Sheet. Following purchase, an ACL is also established for these non-purchase credit deteriorated assets which is not reflected in this table as it is accounted for outside of the business combination. For purchase-credit deteriorated assets, as required by CECL, the fair value mark is divided between an adjustment to par (“Non-Credit Rate Marks”) and an addition to the ACL (“Credit Marks in ACL”). The addition to ACL is based on the application of management’s CECL methodology to the individual loans.


Non-Purchase Credit Deteriorated Loans	Loan Par Value		Fair Value Marks			Purchase Price
Commercial real estate	$	163	$	(14	)	$	149
Commercial and industrial		4,549		(258	)		4,291
Residential real estate		7,053		(103	)		6,950
Agricultural real estate		9,644		(387	)		9,257
Agricultural		2,133		(7	)		2,126
Consumer		1,524		(6	)		1,518
Total non-PCD loans	$	25,066	$	(775	)	$	24,291


Purchase Credit Deteriorated Loans	Loan Par Value		Discounts from Other Factors Excluding ACL			Credit Marks in ACL			Purchase Price
Commercial and industrial		109		(14	)		(9	)		86
Residential real estate		479		(48	)		(43	)		388
Agricultural real estate		3,717		(419	)		(330	)		2,968
Agricultural		244		(29	)		(22	)		193
Total PCD loans	$	4,549	$	(510	)	$	(404	)	$	3,635


Total Purchased Loans	Purchase Price
Non-Purchase Credit Deteriorated Loans	$	24,291
Purchase Credit Deteriorated Loans		3,635
Total loans	$	27,926

Assuming the Rockhold and KansasLand acquisitions would have taken place on January 1, 2023, total combined revenue would have been $226,915 for the year ended December 31, 2024, and $141,078 for the year ended December 31, 2023. Net income would have been $65,077 at December 31, 2024, and $7,518 at December 31, 2023. The pro forma amounts disclosed exclude merger expense from non-interest expense, which is considered a non-recurring adjustment. Separate revenue and earnings of the former Rockhold locations are not available subsequent to the acquisition.

At the close of business on June 24, 2022, the Company sold three branch locations located in Belleville, Clyde and Concordia, Kansas to United Bank and Trust ("UBT"). Results of the branch sale were included in the Company's results of operations beginning June 27, 2022. Branch sale related costs were $18 ($14 on an after-tax basis) and are included in merger expense in the Company's income statement for the year ended December 31, 2022. At December 31, 2023, there were no costs related to this branch sale.

The following table summarizes the carrying value of assets sold and liabilities assumed by UBT on June 24, 2022.


Summary of assets sold and liabilities
assumed by UBT:
Cash and due from banks	$	508
Loans		26,110
Premises and equipment		1,225
Goodwill		1,364
Core deposit intangible		164
Other assets		391
Total assets sold		29,762
Deposits		52,714
Interest payable and other liabilities		19
Total liabilities assumed by UBT		52,733
Total net assets		(22,971	)

Cash paid		22,431
Gain on branch sale	$	(540	)

The following tables present the carrying value of loans and deposits sold to UBT on June 24, 2022.


Commercial real estate	$	793
Commercial and industrial		537
Residential real estate		521
Agricultural real estate		23,685
Consumer		574
Total sold loans	$	26,110


Demand	$	15,817
Total non-interest-bearing deposits		15,817
Demand, savings and money markets		28,615
Time		8,282
Total interest-bearing deposits		36,897
Total deposits	$	52,714

At the close of business on November 10, 2022, the Company sold one branch location located in Cordell, Oklahoma to High Plains Bank ("HPB"). Results of the branch sale were included in the Company's results of operations beginning November 14, 2022. There were no branch sale related costs on the Company's income statement for the year ended December 31, 2022. At December 31, 2023, there were no costs related to this branch sale.

The following table summarizes the carrying value of assets sold and liabilities assumed by HPB on November 10, 2022.


Summary of assets sold and liabilities
assumed by HPB:
Cash and due from banks	$	176
Loans		26
Premises and equipment		211
Core deposit intangible		77
Total assets sold		490
Deposits		19,057
Interest payable and other liabilities		7
Total liabilities assumed by HPB		19,064
Total net assets		(18,574	)

Cash paid		18,152
Gain on branch sale	$	(422	)

The following tables present the carrying value of loans and deposits sold to HPB on November 10, 2022.


Consumer	$	26
Total sold loans	$	26


Demand, savings and money markets	$	12,889
Time		6,168
Total interest-bearing deposits		19,057
Total deposits	$	19,057