UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2025

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ____________ to ____________

Commission file number: 001-38676

BANK FIRST CORPORATION

(Exact name of registrant as specified in its charter)

WISCONSIN	39-1435359
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

402 North 8th Street, Manitowoc, Wisconsin	54220
(Address of principal executive offices)	(Zip Code)

(920) 652-3100

(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes  ⌧    No  ◻

Indicate by check mark whether the registrant has submitted electronically, if any, every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes  ⌧    No  ◻

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ⌧	Accelerated filer ☐
Non-accelerated filer ☐	Smaller reporting company ☐
	Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐  No ☒

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name on each exchange on which registered
Common Stock, par value $0.01 per share	BFC	The Nasdaq Stock Market LLC

The number of shares of the issuer’s common stock, par value $0.01, outstanding as of August 11, 2025 was 9,834,021 shares.

TABLE OF CONTENTS

		Page Number
Part I. Financial Information		3
ITEM 1.	Financial Statements	3
	Consolidated Balance Sheets – June 30, 2025 (unaudited) and December 31, 2024	3
	Consolidated Statements of Income – Three and Six Months Ended June 30, 2025 and 2024 (unaudited)	4
	Consolidated Statements of Comprehensive Income – Three and Six Months Ended June 30, 2025 and 2024 (unaudited)	5
	Consolidated Statements of Changes in Stockholders’ Equity – Three and Six Months Ended June 30, 2025 and 2024 (unaudited)	6
	Consolidated Statements of Cash Flows – Six Months Ended June 30, 2025 and 2024 (unaudited)	7
	Notes to Unaudited Consolidated Financial Statements	9
ITEM 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	27
ITEM 3.	Quantitative and Qualitative Disclosures about Market Risk	53
ITEM 4.	Controls and Procedures	55
Part II. Other Information		55
ITEM 1.	Legal Proceedings	55
ITEM 1A.	Risk Factors	55
ITEM 2.	Unregistered Sales of Equity Securities and Use of Proceeds	56
ITEM 3.	Defaults Upon Senior Securities	56
ITEM 4.	Mine Safety Disclosures	56
ITEM 5.	Other Information	56
ITEM 6.	Exhibits	57
Signatures		58

2

PART I – FINANCIAL INFORMATION

Item 1. FINANCIAL STATEMENTS:

BANK FIRST CORPORATION

Consolidated Balance Sheets

(In thousands, except share and per share data)

	June 30, 2025		December 31, 2024
		(Unaudited)		(Audited)
Assets
Cash and due from banks	$	84,732	$	59,164
Interest-bearing deposits		35,596		202,168
Cash and cash equivalents		120,328		261,332
Securities held to maturity, at amortized cost ($110,422 and $109,424 fair value at June 30, 2025 and December 31, 2024, respectively)		109,854		110,756
Securities available for sale, at fair value ($178,047 and $235,909 amortized cost at June 30, 2025 and December 31, 2024, respectively)		167,209		223,061
Loans held for sale		5,268		3,088
Loans		3,580,357		3,517,168
Allowance for credit losses - loans ("ACL-Loans")		(44,292)		(44,151)
Loans, net		3,536,065		3,473,017
Premises and equipment, net		75,667		71,108
Goodwill		175,106		175,106
Other investments		23,227		22,643
Cash value of life insurance		60,331		61,542
Core deposit intangibles, net		18,632		21,203
Mortgage servicing rights ("MSR")		13,445		13,369
Other real estate owned (“OREO”)		—		741
Investment in Ansay and Associates, LLC ("Ansay")		35,159		34,093
Other assets		24,791		24,001
TOTAL ASSETS	$	4,365,082	$	4,495,060
Liabilities and Stockholders’ Equity
Liabilities:
Deposits:
Interest-bearing deposits	$	2,605,397	$	2,636,192
Noninterest-bearing deposits		990,027		1,024,881
Total deposits		3,595,424		3,661,073
Notes payable		109,915		135,372
Subordinated notes		12,000		12,000
Other liabilities		35,410		46,932
Total liabilities		3,752,749		3,855,377
Stockholders’ equity:
Serial preferred stock - $0.01 par value
Authorized - 5,000,000 shares		—		—
Common stock - $0.01 par value
Authorized - 20,000,000 shares
Issued - 11,515,130 shares as of June 30, 2025 and December 31, 2024
Outstanding - 9,833,476 and 10,012,088 shares as of June 30, 2025 and December 31, 2024, respectively		115		115
Additional paid-in capital		332,734		333,842
Retained earnings		389,479		398,002
Treasury stock, at cost - 1,681,654 and 1,503,042 shares as of June 30, 2025 and December 31, 2024, respectively		(102,234)		(82,925)
Accumulated other comprehensive loss		(7,761)		(9,351)
Total stockholders’ equity		612,333		639,683
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	4,365,082	$	4,495,060

See accompanying notes to consolidated financial statements.

3

ITEM 1. Financial Statements Continued:

BANK FIRST CORPORATION

Consolidated Statements of Income

(In thousands, except per share data) (Unaudited)

	Three months ended June 30,				Six months ended June 30,
	2025		2024		2025		2024
Interest income:
Loans, including fees	$	49,923	$	46,349	$	99,155	$	91,225
Securities:
Taxable		2,787		2,262		5,800		5,149
Tax-exempt		233		241		473		485
Other		1,632		495		4,195		1,760
Total interest income		54,575		49,347		109,623		98,619
Interest expense:
Deposits		16,199		15,794		33,051		31,187
Securities sold under repurchase agreements		—		—		—		22
Borrowed funds		1,674		546		3,333		1,054
Total interest expense		17,873		16,340		36,384		32,263
Net interest income		36,702		33,007		73,239		66,356
Provision for credit losses		200		—		600		200
Net interest income after provision for credit losses		36,502		33,007		72,639		66,156
Noninterest income:
Service charges		2,053		2,101		4,064		3,735
Income from Ansay		1,153		1,379		2,334		2,358
Loan servicing income		733		735		1,465		1,461
Valuation adjustment on MSR		(99)		339		76		27
Net gain on sales of mortgage loans		338		277		672		496
Other		743		1,046		2,898		2,197
Total noninterest income		4,921		5,877		11,509		10,274
Noninterest expense:
Salaries, commissions, and employee benefits		10,427		10,004		21,412		20,897
Occupancy		1,922		1,330		3,513		2,914
Data processing		2,620		2,114		5,064		4,503
Postage, stationery, and supplies		270		205		510		443
Net gain on sales and valuations of OREO		(159)		(461)		(159)		(508)
Net loss on sale of securities		—		—		—		34
Advertising		61		79		126		174
Charitable contributions		274		234		750		410
Federal deposit insurance		630		443		1,260		860
Outside service fees		1,135		1,446		1,923		2,322
Amortization of intangibles		1,273		1,475		2,571		2,975
Other		2,303		2,188		4,390		4,357
Total noninterest expense		20,756		19,057		41,360		39,381
Income before provision for income taxes		20,667		19,827		42,788		37,049
Provision for income taxes		3,792		3,768		7,672		5,578
Net Income	$	16,875	$	16,059	$	35,116	$	31,471
Earnings per share - basic	$	1.71	$	1.59	$	3.53	$	3.10
Earnings per share - diluted	$	1.71	$	1.59	$	3.53	$	3.10

See accompanying notes to unaudited consolidated financial statements.

4

ITEM 1. Financial Statements Continued:

BANK FIRST CORPORATION

Consolidated Statements of Comprehensive Income

(In thousands) (Unaudited)

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2025		2024		2025		2024
Net Income	$	16,875	$	16,059	$	35,116	$	31,471
Other comprehensive income (loss):
Unrealized gains (losses) on available for sale securities:
Unrealized holding gains (losses) arising during period		1,067		71		2,010		(781)
Amortization of unrealized holding gains on securities transferred from available for sale to held to maturity		—		—		—		(1)
Reclassification adjustment for losses included in net income		—		—		—		34
Income tax benefit (expense)		(224)		(31)		(420)		123
Total other comprehensive income (loss)		843		40		1,590		(625)
Comprehensive income	$	17,718	$	16,099	$	36,706	$	30,846

See accompanying notes to unaudited consolidated financial statements.

5

ITEM 1. Financial Statements Continued:

BANK FIRST CORPORATION

Consolidated Statement of Stockholders’ Equity

(In thousands, except share and per share data) (Unaudited)

											Accumulated
	Serial				Additional						Other		Total
	Preferred		Common		Paid-in		Retained		Treasury		Comprehensive		Stockholders'
	Stock		Stock		Capital		Earnings		Stock		Income (loss)		Equity
Balance at January 1, 2024	$	—	$	115	$	333,815	$	348,001	$	(53,387)	$	(8,746)	$	619,798
Net income		—		—		—		15,412		—		—		15,412
Other comprehensive loss		—		—		—		—		—		(665)		(665)
Purchase of treasury stock		—		—		—		—		(22,283)		—		(22,283)
Sale of treasury stock		—		—		—		—		55		—		55
Cash dividends ($0.35 per share)		—		—		—		(3,541)		—		—		(3,541)
Amortization of stock-based compensation		—		—		554		—		—		—		554
Vesting of restricted stock awards		—		—		(2,145)		—		2,145		—		—
Balance at March 31, 2024		—		115		332,224		359,872		(73,470)		(9,411)		609,330
Net income		—		—		—		16,059		—		—		16,059
Other comprehensive income		—		—		—		—		—		40		40
Purchase of treasury stock		—		—		—		—		(7,943)		—		(7,943)
Sale of treasury stock		—		—		—		—		65		—		65
Cash dividends ($0.35 per share)		—		—		—		(3,511)		—		—		(3,511)
Amortization of stock-based compensation		—		—		539		—		—		—		539
Balance at June 30, 2024	$	—	$	115	$	332,763	$	372,420	$	(81,348)	$	(9,371)	$	614,579
Balance at January 1, 2025	$	—	$	115	$	333,842	$	398,002	$	(82,925)	$	(9,351)	$	639,683
Net income		—		—		—		18,241		—		—		18,241
Other comprehensive income		—		—		—		—		—		747		747
Purchase of treasury stock		—		—		—		—		(6,381)		—		(6,381)
Sale of treasury stock		—		—		—		—		64		—		64
Cash dividends ($0.45 per share)		—		—		—		(4,491)		—		—		(4,491)
Amortization of stock-based compensation		—		—		551		—		—		—		551
Vesting of restricted stock awards		—		—		(2,143)		—		2,143		—		—
Balance at March 31, 2025		—		115		332,250		411,752		(87,099)		(8,604)		648,414
Net income		—		—		—		16,875		—		—		16,875
Other comprehensive income		—		—		—		—		—		843		843
Purchase of treasury stock		—		—		—		—		(15,662)		—		(15,662)
Sale of treasury stock		—		—		—		—		527		—		527
Cash dividends ($3.95 per share)		—		—		—		(39,148)		—		—		(39,148)
Amortization of stock-based compensation		—		—		484		—		—		—		484
Balance at June 30, 2025	$	—	$	115	$	332,734	$	389,479	$	(102,234)	$	(7,761)	$	612,333

See accompanying notes to unaudited consolidated financial statements.

6

ITEM 1. Financial Statements Continued:

BANK FIRST CORPORATION

Consolidated Statements of Cash Flows

(In thousands) (Unaudited)

	Six Months Ended June 30,
	2025		2024
Cash flows from operating activities:
Net income	$	35,116	$	31,471
Adjustments to reconcile net income to net cash provided by operating activities:
Provision for credit losses		600		200
Depreciation and amortization of premises and equipment		1,182		1,122
Amortization of intangibles		2,571		2,975
Net accretion of securities		(2,092)		(1,849)
Amortization of stock-based compensation		1,035		1,093
Accretion of purchase accounting valuations		(1,657)		(2,357)
Net change in deferred loan fees and costs		(362)		(106)
Change in fair value of MSR and other investments		(660)		84
Loss from sale and disposal of premises and equipment		32		174
Net gain on sale of OREO and valuation allowance		(159)		(508)
Proceeds from sales of mortgage loans		60,082		43,345
Originations of mortgage loans held for sale		(61,590)		(42,111)
Gain on sales of mortgage loans		(672)		(496)
Realized loss on sale of securities		—		34
Undistributed income of Ansay joint venture		(2,334)		(2,358)
Net earnings on life insurance		(688)		(817)
Increase in other assets		(1,210)		(1,129)
Decrease in other liabilities		(11,172)		(12,504)
Net cash provided by operating activities		18,022		16,263
Cash flows from investing activities:
Activity in securities available for sale and held to maturity:
Sales		—		10,206
Maturities, prepayments, and calls		263,608		91,444
Purchases		(202,752)		(93,687)
Net increase in loans		(61,919)		(82,384)
Dividends received from Ansay		1,268		1,066
Proceeds from sale of OREO		900		1,936
Proceeds from life insurance		1,899		1,205
Proceeds from sale of premises and equipment		1		2,380
Purchases of premises and equipment		(5,774)		(1,985)
Net cash used in investing activities		(2,769)		(69,819)

7

ITEM 1. Financial Statements Continued:

BANK FIRST CORPORATION

Consolidated Statements of Cash Flows (Continued)

(In thousands) (Unaudited)

	Six Months Ended June 30,
	2025		2024
Cash flows from financing activities:
Net decrease in deposits	$	(65,658)	$	(32,933)
Net decrease in securities sold under repurchase agreements		—		(75,747)
Proceeds from advances of notes payable		—		102,000
Repayment of notes payable		(25,508)		(47,000)
Repayment of junior subordinated debentures		—		(4,124)
Dividends paid		(43,639)		(7,052)
Proceeds from sales of common stock		591		120
Repurchase of common stock		(22,043)		(30,226)
Net cash used in financing activities		(156,257)		(94,962)
Net decrease in cash and cash equivalents		(141,004)		(148,518)
Cash and cash equivalents at beginning of period		261,332		247,468
Cash and cash equivalents at end of period	$	120,328	$	98,950
Supplemental disclosures of cash flow information:
Cash paid during the period for:
Interest	$	37,256	$	30,608
Income taxes		6,669		6,286
Supplemental schedule of noncash activities:
MSR resulting from sale of loans		706		488
Change in unrealized gain (loss) on investment securities available for sale, net of tax		1,590		(625)

See accompanying notes to consolidated financial statements.

8

BANK FIRST CORPORATION

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

(in thousands, except share and per share data)

NOTE 1 – BASIS OF PRESENTATION

Bank First Corporation (the “Company”) provides a variety of financial services to individual and corporate customers through its wholly-owned subsidiary, Bank First, N.A. (the “Bank”). The Bank operates as a full-service financial institution with a primary market area including, but not limited to, the counties in which the Bank’s branches are located. The Bank has twenty-seven locations located in Manitowoc, Outagamie, Brown, Winnebago, Sheboygan, Shawano, Waupaca, Ozaukee, Monroe, Fond du Lac, Waushara, Dane, Columbia, Door and Jefferson counties in Wisconsin. The Company and Bank are subject to the regulations of certain federal agencies and undergo periodic examinations by those regulatory authorities.

These interim unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) for interim financial information and with the instructions to Quarterly Report on Form 10-Q and Article 10 of Regulation S-X. Accordingly, certain information and footnote disclosures required by GAAP have been omitted or abbreviated. These unaudited consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and footnotes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024 (“Annual Report”).

The unaudited consolidated financial statements include all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of the results for the interim periods. The results for interim periods are not necessarily indicative of results for a full year.

Critical Accounting Policies and Estimates

The accounting and reporting policies of the Company conform to GAAP in the United States and general practices within the financial institution industry. To prepare financial statements in conformity with GAAP, management makes estimates, assumptions and judgments based on available information. These estimates, assumptions and judgments are based on information available as of the date of the financial statements and, as this information changes, actual results could differ from the estimates, assumptions and judgments reflected in the financial statement. As disclosed in the Company’s Annual Report, management has identified several accounting policies that, due to the estimates, assumptions and judgments inherent in those policies, are critical in understanding our financial statements. These include accounting for business combinations (primarily related to core deposit intangibles and acquired loans) and accounting for the ACL-Loans.

There have been no material changes or developments with respect to the assumptions or methodologies that the Company uses when applying what management believes are critical accounting policies and developing critical accounting estimates as previously disclosed in the Company’s Annual Report.

Reclassifications

Certain 2024 amounts have been reclassified to conform to the presentation used in 2025. These reclassifications had no effect on the operations, financial condition or cash flows of the Company.

Recently Issued Not Yet Effective Accounting Standards

In October 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-06, Disclosure Improvements. This ASU modifies the disclosure or presentation requirements of a variety of Topics in the Codification. The amendments in this ASU are expected to clarify or improve disclosure and presentation requirements for certain codification topics. The effective date for each amendment will be the date on which the Security and Exchange Commission’s removal of that related disclosure from Regulation S-X or Regulation S-K becomes effective, with early adoption prohibited. If, by June 30, 2027, the Securities and Exchange Commission has not removed the applicable requirement from Regulation S-X or Regulation S-K, the pending content of the related amendment will be removed from the Codification and will not become effective for any entity. The Company does not anticipate a significant impact to its financial statement disclosures as a result of this ASU.

9

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. This ASU is intended to improve the transparency and decision usefulness of income tax disclosures by requiring specific categories in the rate reconciliation table and disaggregation of taxes paid by jurisdiction. All public entities must also provide additional information for reconciling items that meet a specific quantitative threshold. This update is effective for annual periods beginning after December 15, 2024. The Company anticipates that this standard will require expanded disclosure related to its income tax exposure, but will not cause any change in the accounting for operational results.

In November 2024, the FASB issued ASU 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Topic 220): Disaggregation of Income Statement Expenses. This ASU is intended to improve the disclosures about a public entity’s income statement expense categories and addresses requests from investors and other decision makers for additional, more detailed information about income statement expense categories. The amendment applies to all public entities that are required to report income statement categories in accordance with Topic 280. The effective date for this update was amended by ASU 2025-01, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the Effective Date, and is now effective for annual periods beginning after December 15, 2026, and interim reporting periods within annual reporting periods beginning after December 15, 2027.

NOTE 2 – EARNINGS PER SHARE

The two-class method is used in the calculation of basic and diluted earnings per share. Under the two-class method, earnings available to common shareholders for the period are allocated between common shareholders and participating securities according to dividends declared (or accumulated) and participation rights in undistributed earnings. There were no anti-dilutive stock options for the six months ended June 30, 2025 or 2024.

The following table presents the factors used in the earnings per share computations for the period indicated:

	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024
Basic
Net income available to common shareholders	$	16,875	$	16,059	$	35,116	$	31,471
Less: Earnings allocated to participating securities		(80)		(84)		(179)		(169)
Net income allocated to common shareholders	$	16,795	$	15,975	$	34,937	$	31,302
Weighted average common shares outstanding including participating securities		9,901,391		10,078,611		9,950,925		10,155,979
Less: Participating securities (1)		(47,085)		(52,634)		(48,935)		(54,488)
Average shares		9,854,306		10,025,977		9,901,990		10,101,491
Basic earnings per common share	$	1.71	$	1.59	$	3.53	$	3.10
Diluted
Net income available to common shareholders	$	16,875	$	16,059	$	35,116	$	31,471
Weighted average common shares outstanding for basic earnings per common share		9,854,306		10,025,977		9,901,990		10,101,491
Add: Dilutive effects of stock-based compensation awards		14,433		13,885		20,379		21,073
Average shares and dilutive potential common shares		9,868,739		10,039,862		9,922,369		10,122,564
Diluted earnings per common share	$	1.71	$	1.59	$	3.53	$	3.10

(1) Participating securities are restricted stock awards whereby the stock certificates have been issued, are included in outstanding shares, receive dividends and can be voted, but have not vested.

10

NOTE 3 – SECURITIES

The following is a summary of available for sale securities:

			Gross		Gross
	Amortized		Unrealized		Unrealized		Estimated
	Cost		Gains		Losses		Fair Value
June 30, 2025
Obligations of U.S. Government sponsored agencies	$	24,611	$	—	$	(2,343)	$	22,268
Obligations of states and political subdivisions		61,509		66		(6,212)		55,363
Mortgage-backed securities		76,255		124		(1,345)		75,034
Corporate notes		15,672		—		(1,128)		14,544
Total available for sale securities	$	178,047	$	190	$	(11,028)	$	167,209
December 31, 2024
U.S. Treasury securities	$	99,656	$	—	$	—	$	99,656
Obligations of U.S. Government sponsored agencies		27,766		1		(3,026)		24,741
Obligations of states and political subdivisions		62,992		3		(6,638)		56,357
Mortgage-backed securities		29,826		3		(1,836)		27,993
Corporate notes		15,669		—		(1,355)		14,314
Total available for sale securities	$	235,909	$	7	$	(12,855)	$	223,061

The following is a summary of held to maturity securities:

			Gross		Gross
	Amortized		Unrealized		Unrealized		Estimated
	Cost		Gains		Losses		Fair Value
June 30, 2025
U.S. Treasury securities	$	107,459	$	1,046	$	(478)	$	108,027
Obligations of states and political subdivisions		2,395		—		—		2,395
Total held to maturity securities	$	109,854	$	1,046	$	(478)	$	110,422
December 31, 2024
U.S. Treasury securities	$	107,561	$	224	$	(1,556)	$	106,229
Obligations of states and political subdivisions		3,195		—		—		3,195
Total held to maturity securities	$	110,756	$	224	$	(1,556)	$	109,424

11

The following table shows the fair value and gross unrealized losses of securities with unrealized losses, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position:

	Less Than 12 Months				Greater Than 12 Months				Total
													Number
	Fair		Unrealized		Fair		Unrealized		Fair		Unrealized		of
	Value		Losses		Value		Losses		Value		Losses		Securities
June 30, 2025 - Available for Sale
Obligations of U.S. Government sponsored agencies	$	1,056	$	(10)	$	21,212	$	(2,333)	$	22,268	$	(2,343)	24
Obligations of states and political subdivisions		4,976		(34)		45,273		(6,178)		50,249		(6,212)	64
Mortgage-backed securities		17,583		(113)		22,527		(1,232)		40,110		(1,345)	101
Corporate notes		—		—		13,387		(1,128)		13,387		(1,128)	9
Totals	$	23,615	$	(157)	$	102,399	$	(10,871)	$	126,014	$	(11,028)	198
June 30, 2025 - Held to Maturity
U.S. Treasury securities	$	28,638	$	(220)	$	21,850	$	(258)	$	50,488	$	(478)	34
December 31, 2024 - Available for Sale
Obligations of U.S. Government sponsored agencies	$	1,177	$	(23)	$	22,069	$	(3,003)	$	23,246	$	(3,026)	24
Obligations of states and political subdivisions		10,380		(129)		44,686		(6,509)		55,066		(6,638)	77
Mortgage-backed securities		3,913		(140)		23,863		(1,696)		27,776		(1,836)	100
Corporate notes		—		—		13,168		(1,355)		13,168		(1,355)	9
Totals	$	15,470	$	(292)	$	103,786	$	(12,563)	$	119,256	$	(12,855)	210
December 31, 2024 - Held to Maturity
U.S. Treasury securities	$	46,456	$	(1,045)	$	31,322	$	(511)	$	77,778	$	(1,556)	48

As of June 30, 2025, and December 31, 2024, no allowance for credit losses has been recognized on available for sale securities in an unrealized loss position as the Company does not believe any of the debt securities are credit impaired. This is based on the Company’s analysis of the risk characteristics, including credit ratings, and other qualitative factors related to these securities. The issuers of these securities continue to make timely principal and interest payments under the contractual terms of the securities. As of June 30, 2025, the Company did not intend to sell these securities and it was more likely than not that the Company would not be required to sell the debt securities before recovery of their amortized cost, which may be at maturity. The unrealized losses have occurred as a result of changes in interest rates, market spreads and market conditions subsequent to purchase, not credit deterioration.

Furthermore, based on its analysis the Company has determined that held to maturity securities have zero expected credit losses. U.S. Treasury securities have the full faith and credit backing of the United States Government.

12

The following is a summary of amortized cost and estimated fair value of securities by contractual maturity as of June 30, 2025. Contractual maturities will differ from expected maturities for mortgage-backed securities because borrowers may have the right to call or prepay obligations without penalties.

	Available for Sale				Held to Maturity
	Amortized		Estimated		Amortized		Estimated
	Cost		Fair Value		Cost		Fair Value
Due in one year or less	$	830	$	825	$	23,877	$	23,769
Due after one year through 5 years		19,536		19,246		39,425		39,447
Due after 5 years through 10 years		43,820		39,945		46,552		47,206
Due after 10 years		37,606		32,159		—		—
Subtotal		101,792		92,175		109,854		110,422
Mortgage-backed securities		76,255		75,034		—		—
Total	$	178,047	$	167,209	$	109,854	$	110,422

As of June 30, 2025 and December 31, 2024, the carrying values of securities pledged to secure public deposits and for other purposes required or permitted by law were approximately $196.5 million and $273.4 million, respectively.

There were no sales of securities available for sale during the three months ended June 30, 2025 and 2024, or the six months ended June 30, 2025. Sales of securities available for sale produced $10.2 million in proceeds with immaterial gross losses for the six months ended June 30, 2024.

NOTE 4 – LOANS, ALLOWANCE FOR CREDIT LOSSES, AND CREDIT QUALITY

The following table presents total loans by portfolio segment and class of loan as of June 30, 2025 and December 31, 2024:

	2025		2024
Commercial/industrial	$	629,252	$	590,874
Commercial real estate - owner occupied		842,111		847,056
Commercial real estate - non-owner occupied		518,751		509,342
Multi-family		377,541		326,573
Construction and development		250,247		278,639
Residential 1‑4 family		891,389		895,684
Consumer		57,635		55,164
Other		14,829		15,593
Subtotals		3,581,755		3,518,925
ACL - Loans		(44,292)		(44,151)
Loans, net of ACL - Loans		3,537,463		3,474,774
Deferred loan fees, net		(1,398)		(1,757)
Loans, net	$	3,536,065	$	3,473,017

The ACL - Loans is based on the Company’s evaluation of historical default and loss experience, current and projected economic conditions, asset quality trends, known and inherent risks in the portfolio, adverse situations that may affect the borrowers’ ability to repay a loan, the estimated value of any underlying collateral, composition of the loan portfolio and other relevant factors. More information regarding the Company’s methodology related to the ACL-Loans can be found in the Company’s Annual Report.

The Company utilized the high-end range of the Federal Reserve Bank Open Market Committee forecast for national unemployment and the low-end range for national GDP growth at June 30, 2025 and December 31, 2024. As of June 30, 2025, the Company anticipates the national unemployment rate to rise during the forecast period and the national GDP growth rate to decline. The Company utilized long-term averages for the remaining loss drivers.

13

A roll forward of the ACL-Loans is summarized as follows:

	Three Months Ended				Six Months Ended				Year Ended
	June 30, 2025		June 30, 2024		June 30, 2025		June 30, 2024		December 31, 2024
Beginning Balance	$	43,749	$	44,378	$	44,151	$	43,609	$	43,609
Provision for credit losses		550		500		950		700		100
Charge-offs		(22)		(25)		(858)		(77)		(566)
Recoveries		15		265		49		886		1,008
Net (charge-offs) recoveries		(7)		240		(809)		809		442
Ending Balance	$	44,292	$	45,118	$	44,292	$	45,118	$	44,151

A summary of the activity in the ACL - Loans by loan type for the six months ended June 30, 2025 is summarized as follows:

			Commercial		Commercial
			Real Estate -		Real Estate  -				Construction
	Commercial /		Owner		Non - Owner		Multi-		and		Residential
	Industrial		Occupied		Occupied		Family		Development		1-4 Family		Consumer		Other		Total
ACL - Loans - January 1, 2025	$	6,737	$	9,334	$	5,213	$	3,739	$	5,223	$	12,684	$	1,084	$	137	$	44,151
Charge-offs		—		(802)		—		—		—		(1)		(30)		(25)		(858)
Recoveries		2		—		—		—		—		33		9		5		49
Provision		1		1,686		(246)		542		(724)		(377)		41		27		950
ACL - Loans - June 30, 2025	$	6,740	$	10,218	$	4,967	$	4,281	$	4,499	$	12,339	$	1,104	$	144	$	44,292

A summary of the activity in the ACL – Loans by loan type for the six months ended June 30, 2024 is summarized as follows:

			Commercial		Commercial
			Real Estate -		Real Estate -				Construction
	Commercial /		Owner		Non - Owner		Multi-		and		Residential
	Industrial		Occupied		Occupied		Family		Development		1-4 Family		Consumer		Other		Total
ACL - Loans - January 1, 2024	$	8,471	$	9,537	$	6,055	$	4,755	$	3,581	$	10,522	$	615	$	73	$	43,609
Charge-offs		(17)		(1)		—		—		—		(1)		(6)		(52)		(77)
Recoveries		2		861		—		—		—		6		2		15		886
Provision		(296)		164		65		(85)		573		188		(1)		92		700
ACL - Loans - June 30, 2024	$	8,160	$	10,561	$	6,120	$	4,670	$	4,154	$	10,715	$	610	$	128	$	45,118

In addition to the ACL-Loans, the Company has established an allowance for credit losses on unfunded commitments (“ACL-Unfunded Commitments”), classified in other liabilities on the consolidated balance sheets. This allowance is maintained to absorb losses arising from unfunded loan commitments, and is determined quarterly based on methodology similar to the methodology for determining the ACL-Loans. The ACL - Unfunded Commitments was $2.6 million at June 30, 2025 and December 31, 2024, respectively. See Note 10 for further information on commitments.

The provision for credit losses is determined by the Company as the amount to be added to the ACL accounts for various types of financial instruments including loans, investment securities, and off-balance sheet credit exposures after net charge-offs have been deducted to bring the ACL to a level that, in management’s judgment, is necessary to absorb expected credit losses over the lives of the respective financial instruments. The following table presents the components of the provision for credit losses.

	Three Months Ended				Six Months Ended				Year Ended
	June 30, 2025		June 30, 2024		June 30, 2025		June 30, 2024		December 31, 2024
Provision for credit losses on:
Loans	$	550	$	500	$	950	$	700	$	100
Unfunded Commitments		(350)		(500)		(350)		(500)		(900)
Total provision for credit losses	$	200	$	—	$	600	$	200	$	(800)

14

The Company’s past due and non-accrual loans as of June 30, 2025 is summarized as follows:

			90 Days						Non-Accrual
	30-89 Days		or more						with no
	Past Due		Past Due		Non-				related
	Accruing		and Accruing		Accrual		Total		allowance
Commercial/industrial	$	54	$	24	$	6,732	$	6,810	$	247
Commercial real estate - owner occupied		3,639		—		4,828		8,467		1,392
Commercial real estate - non-owner occupied		9		—		113		122		113
Multi-family		—		—		—		—		—
Construction and development		85		3		—		88		—
Residential 1‑4 family		1,331		511		1,306		3,148		1,306
Consumer		131		25		55		211		55
Other		—		—		—		—		—
	$	5,249	$	563	$	13,034	$	18,846	$	3,113

The Company’s past due and non-accrual loans as of December 31, 2024 is summarized as follows:

			90 Days						Non-Accrual
	30-89 Days		or more						with no
	Past Due		Past Due		Non-				related
	Accruing		and Accruing		Accrual		Total		allowance
Commercial/industrial	$	50	$	328	$	2,268	$	2,646	$	1
Commercial real estate - owner occupied		446		—		3,525		3,971		800
Commercial real estate - non-owner occupied		—		—		493		493		493
Multi-family		—		—		—		—		—
Construction and development		90		—		—		90		—
Residential 1‑4 family		1,317		1,294		511		3,122		511
Consumer		108		48		29		185		29
Other		—		—		—		—		—
	$	2,011	$	1,670	$	6,826	$	10,507	$	1,834

Interest recognized on non-accrual loans is considered immaterial to the consolidated financial statements for the six months ended June 30, 2025 and 2024.

A loan is considered to be collateral dependent when, based upon management’s assessment, the borrower is experiencing financial

difficulty and repayment is expected to be provided substantially through the operation or sale of the collateral. For collateral dependent loans, expected credit losses are based on amortized cost of the loan less the estimated fair value of the collateral at the balance sheet date, with consideration for estimated selling costs if satisfaction of the loan depends on the sale of the collateral.

15

The following tables present collateral dependent loans by portfolio segment and collateral type, including those loans with and without a related allowance allocation. A significant portion of the loan balances in these tables and essentially all of the allowance allocations relate to PCD loans which were acquired from Hometown. Real estate collateral primarily consists of operating facilities of the underlying borrowers. Other business assets collateral primarily consists of equipment, receivables and inventory of the underlying borrowers.

	Collateral Type
As of June 30, 2025			Other				Without an		With an		Allowance
	Real Estate		Business Assets		Total		Allowance		Allowance		Allocation
Commercial/industrial	$	—	$	6,485	$	6,485	$	—	$	6,485	$	1,429
Commercial real estate - owner occupied		7,607		—		7,607		4,171		3,436		1,767
Commercial real estate - non-owner occupied		—		—		—		—		—		—
Multi-family		—		—		—		—		—		—
Construction and development		—		—		—		—		—		—
Residential 1‑4 family		—		—		—		—		—		—
Consumer		—		—		—		—		—		—
Other		—		—		—		—		—		—
Total Loans	$	7,607	$	6,485	$	14,092	$	4,171	$	9,921	$	3,196

	Collateral Type
As of December 31, 2024			Other				Without an		With an		Allowance
	Real Estate		Business Assets		Total		Allowance		Allowance		Allocation
Commercial/industrial	$	—	$	2,266	$	2,266	$	—	$	2,266	$	1,290
Commercial real estate - owner occupied		6,322		—		6,322		800		5,522		1,104
Commercial real estate - non-owner occupied		—		—		—		—		—		—
Multi-family		—		—		—		—		—		—
Construction and development		—		—		—		—		—		—
Residential 1‑4 family		—		—		—		—		—		—
Consumer		—		—		—		—		—		—
Other		—		—		—		—		—		—
Total Loans	$	6,322	$	2,266	$	8,588	$	800	$	7,788	$	2,394

The Company utilizes a numerical risk rating system for commercial relationships. All other types of relationships (ex: residential, consumer, other) are assigned a “Pass” rating, unless they have fallen 90 days past due or more, at which time they are assessed for a rating of 5, 6 or 7. The Company uses split ratings for government guaranties on loans. The portion of a loan that is supported by a government guaranty is included with other Pass credits.

The determination of a commercial loan risk rating begins with completion of a matrix, which assigns scores based on the strength of the borrower’s debt service coverage, collateral coverage, balance sheet leverage, industry outlook, and customer concentration. A weighted average is taken of these individual scores to arrive at the overall rating. This rating is subject to adjustment by the loan officer based on facts and circumstances pertaining to the borrower. Risk ratings are subject to independent review.

Commercial borrowers with ratings between 1 and 5 are considered Pass credits, with 1 being most acceptable and 5 being just above the minimum level of acceptance. Commercial borrowers rated 6 have potential weaknesses which may jeopardize repayment ability. Borrowers rated 7 have a well-defined weakness or weaknesses such as the inability to demonstrate significant cash flow for debt service based on analysis of the company’s financial information. These loans remain on accrual status provided full collection of principal and interest is reasonably expected. Otherwise they are deemed impaired and placed on nonaccrual status. Borrowers rated 8 are the same as 7 rated credits with one exception: collection or liquidation in full is not probable.

16

The following tables present total loans by risk ratings and year of origination. Loans acquired from other previously acquired institutions have been included in the table based upon the actual origination date.

	Amortized Cost Basis by Origination Year
As of June 30, 2025																Revolving
		2025		2024		2023		2022		2021		Prior		Revolving		to Term		Total
Commercial/industrial
Grades 1-4	$	43,141	$	69,600	$	55,901	$	61,187	$	45,547	$	58,733	$	129,785	$	-	$	463,894
Grade 5		22,108		8,032		3,953		5,002		5,581		3,911		36,209		-		84,796
Grade 6		-		6,389		635		40,892		501		1,385		6,003		-		55,805
Grade 7		55		228		790		2,684		8,031		5,102		7,867		-		24,757
Grade 8		-		-		-		-		-		-		-		-		-
Total	$	65,304	$	84,249	$	61,279	$	109,765	$	59,660	$	69,131	$	179,864	$	-	$	629,252
Current-period gross charge-offs	$	-	$	-	$	-	$	-	$	-	$	-	$	-	$	-	$	-
Commercial real estate - owner occupied
Grades 1-4	$	18,204	$	98,358	$	46,271	$	88,610	$	136,675	$	227,463	$	27,340	$	-	$	642,921
Grade 5		9,001		41,075		19,840		24,151		24,295		38,566		962		-		157,890
Grade 6		-		-		-		2,984		395		5,746		-		-		9,125
Grade 7		1,599		1,250		610		1,043		2,214		24,336		1,123		-		32,175
Grade 8		-		-		-		-		-		-		-		-		-
Total	$	28,804	$	140,683	$	66,721	$	116,788	$	163,579	$	296,111	$	29,425	$	-	$	842,111
Current-period gross charge-offs	$	-	$	802	$	-	$	-	$	-	$	-	$	-	$	-	$	802
Commercial real estate - non-owner occupied
Grades 1-4	$	15,487	$	32,009	$	55,977	$	58,352	$	112,233	$	140,958	$	14,035	$	-	$	429,051
Grade 5		4,830		19,648		5,985		4,761		19,444		20,797		25		-		75,490
Grade 6		-		-		-		1,901		402		1,336		1,585		-		5,224
Grade 7		-		-		-		-		5,830		3,066		90		-		8,986
Grade 8		-		-		-		-		-		-		-		-		-
Total	$	20,317	$	51,657	$	61,962	$	65,014	$	137,909	$	166,157	$	15,735	$	-	$	518,751
Current-period gross charge-offs	$	-	$	-	$	-	$	-	$	-	$	-	$	-	$	-	$	-
Multi-family
Grades 1-4	$	22,784	$	15,226	$	37,616	$	32,194	$	98,539	$	147,359	$	3,142	$	-	$	356,860
Grade 5		-		13,760		1,001		773		-		-		-		-		15,534
Grade 6		-		-		-		-		-		-		-		-		-
Grade 7		-		441		-		-		2,477		2,229		-		-		5,147
Grade 8		-		-		-		-		-		-		-		-		-
Total	$	22,784	$	29,427	$	38,617	$	32,967	$	101,016	$	149,588	$	3,142	$	-	$	377,541
Current-period gross charge-offs	$	-	$	-	$	-	$	-	$	-	$	-	$	-	$	-	$	-
Construction and development
Grades 1-4	$	24,399	$	48,379	$	24,580	$	60,199	$	11,210	$	7,156	$	1,206	$	-	$	177,129
Grade 5		2,621		31,968		34,369		1,399		494		695		677		-		72,223
Grade 6		-		-		-		-		-		-		-		-		-
Grade 7		-		-		-		-		-		895		-		-		895
Grade 8		-		-		-		-		-		-		-		-		-
Total	$	27,020	$	80,347	$	58,949	$	61,598	$	11,704	$	8,746	$	1,883	$	-	$	250,247
Current-period gross charge-offs	$	-	$	-	$	-	$	-	$	-	$	-	$	-	$	-	$	-
Residential 1‑4 family
Grades 1-4	$	35,160	$	90,476	$	88,225	$	163,027	$	162,568	$	221,787	$	107,235	$	-	$	868,478
Grade 5		4,322		2,220		2,201		3,262		858		2,076		2,077		-		17,016
Grade 6		-		-		181		320		-		188		-		-		689
Grade 7		-		18		118		531		548		3,380		611		-		5,206
Grade 8		-		-		-		-		-		-		-		-		-
Total	$	39,482	$	92,714	$	90,725	$	167,140	$	163,974	$	227,431	$	109,923	$	-	$	891,389
Current-period gross charge-offs	$	-	$	-	$	-	$	-	$	-	$	1	$	-	$	-	$	1
Consumer
Grades 1-4	$	17,320	$	17,328	$	10,374	$	5,871	$	2,770	$	3,385	$	510	$	-	$	57,558
Grade 5		-		-		-		-		-		-		-		-		-
Grade 6		-		-		-		-		-		-		-		-		-
Grade 7		-		36		1		2		8		30		-		-		77
Grade 8		-		-		-		-		-		-		-		-		-
Total	$	17,320	$	17,364	$	10,375	$	5,873	$	2,778	$	3,415	$	510	$	-	$	57,635
Current-period gross charge-offs	$	-	$	8	$	9	$	13	$	-	$	-	$	-	$	-	$	30
Other
Grades 1-4	$	392	$	1,585	$	97	$	536	$	448	$	9,066	$	2,438	$	-	$	14,562
Grade 5		-		-		143		26		-		-		98		-		267
Grade 6		-		-		-		-		-		-		-		-		-
Grade 7		-		-		-		-		-		-		-		-		-
Grade 8		-		-		-		-		-		-		-		-		-
Total	$	392	$	1,585	$	240	$	562	$	448	$	9,066	$	2,536	$	-	$	14,829
Current-period gross charge-offs	$	-	$	-	$	-	$	-	$	-	$	-	$	25	$	-	$	25
Total Loans	$	221,423	$	498,026	$	388,868	$	559,707	$	641,068	$	929,645	$	343,018	$	-	$	3,581,755
Total current-period gross charge-offs	$	-	$	810	$	9	$	13	$	-	$	1	$	25	$	-	$	858

17

	Amortized Cost Basis by Origination Year
As of December 31, 2024																Revolving
		2024		2023		2022		2021		2020		Prior		Revolving		to Term		Total
Commercial/industrial
Grades 1-4	$	87,354	$	66,249	$	73,634	$	58,296	$	47,555	$	21,121	$	100,727	$	-	$	454,936
Grade 5		16,551		4,736		48,143		5,976		4,272		319		24,179		-		104,176
Grade 6		274		403		608		1,027		1,483		-		3,640		-		7,435
Grade 7		362		1,694		2,809		8,508		2,880		1,792		6,282		-		24,327
Grade 8		-		-		-		-		-		-		-		-		-
Total	$	104,541	$	73,082	$	125,194	$	73,807	$	56,190	$	23,232	$	134,828	$	-	$	590,874
Current-period gross charge-offs	$	-	$	-	$	9	$	15	$	-	$	2	$	-	$	-	$	26
Commercial real estate - owner occupied
Grades 1-4	$	87,227	$	52,984	$	97,543	$	150,781	$	85,351	$	165,348	$	18,408	$	-	$	657,642
Grade 5		35,416		17,763		19,031		19,838		8,671		40,461		1,295		-		142,475
Grade 6		-		-		3,095		1,262		4,183		1,930		369		-		10,839
Grade 7		149		-		6,139		1,424		1,792		25,304		1,292		-		36,100
Grade 8		-		-		-		-		-		-		-		-		-
Total	$	122,792	$	70,747	$	125,808	$	173,305	$	99,997	$	233,043	$	21,364	$	-	$	847,056
Current-period gross charge-offs	$	-	$	-	$	-	$	293	$	-	$	1	$	-	$	-	$	294
Commercial real estate - non-owner occupied
Grades 1-4	$	28,799	$	55,712	$	63,985	$	131,184	$	53,095	$	107,730	$	9,895	$	-	$	450,400
Grade 5		14,950		3,655		2,827		3,074		3,573		15,190		-		-		43,269
Grade 6		-		-		1,489		412		-		2,589		1,565		-		6,055
Grade 7		-		-		-		5,907		351		3,161		199		-		9,618
Grade 8		-		-		-		-		-		-		-		-		-
Total	$	43,749	$	59,367	$	68,301	$	140,577	$	57,019	$	128,670	$	11,659	$	-	$	509,342
Current-period gross charge-offs	$	-	$	-	$	-	$	-	$	-	$	-	$	-	$	-	$	-
Commercial real estate - multi-family
Grades 1-4	$	1,724	$	26,209	$	32,891	$	100,950	$	71,584	$	82,936	$	3,385	$	-	$	319,679
Grade 5		779		1,014		1,307		994		-		118		-		-		4,212
Grade 6		-		-		-		-		-		-		-		-		-
Grade 7		442		-		-		-		-		2,240		-		-		2,682
Grade 8		-		-		-		-		-		-		-		-		-
Total	$	2,945	$	27,223	$	34,198	$	101,944	$	71,584	$	85,294	$	3,385	$	-	$	326,573
Current-period gross charge-offs	$	-	$	-	$	-	$	-	$	-	$	-	$	-	$	-	$	-
Construction and development
Grades 1-4	$	66,756	$	45,018	$	60,063	$	11,608	$	3,666	$	4,921	$	1,566	$	-	$	193,598
Grade 5		23,486		52,351		2,529		1,033		603		199		522		-		80,723
Grade 6		233		-		-		-		-		-		-		-		233
Grade 7		-		676		-		2,489		160		760		-		-		4,085
Grade 8		-		-		-		-		-		-		-		-		-
Total	$	90,475	$	98,045	$	62,592	$	15,130	$	4,429	$	5,880	$	2,088	$	-	$	278,639
Current-period gross charge-offs	$	-	$	-	$	-	$	-	$	-	$	-	$	-	$	-	$	-
Residential 1‑4 family
Grades 1-4	$	97,627	$	96,036	$	177,940	$	170,734	$	138,976	$	100,537	$	93,957	$	-	$	875,807
Grade 5		2,785		2,970		3,519		1,054		1,011		1,621		1,064		-		14,024
Grade 6		-		151		350		-		-		197		-		-		698
Grade 7		-		-		536		561		191		2,900		967		-		5,155
Grade 8		-		-		-		-		-		-		-		-		-
Total	$	100,412	$	99,157	$	182,345	$	172,349	$	140,178	$	105,255	$	95,988	$	-	$	895,684
Current-period gross charge-offs	$	-	$	-	$	-	$	-	$	-	$	44	$	-	$	-	$	44
Consumer
Grades 1-4	$	25,766	$	12,581	$	8,063	$	3,825	$	2,774	$	1,624	$	466	$	-	$	55,099
Grade 5		-		-		-		-		-		-		-		-		-
Grade 6		-		-		-		-		-		-		-		-		-
Grade 7		10		11		15		9		-		20		-		-		65
Grade 8		-		-		-		-		-		-		-		-		-
Total	$	25,776	$	12,592	$	8,078	$	3,834	$	2,774	$	1,644	$	466	$	-	$	55,164
Current-period gross charge-offs	$	88	$	15	$	4	$	-	$	3	$	-	$	-	$	-	$	110
Other
Grades 1-4	$	1,901	$	119	$	573	$	483	$	605	$	9,070	$	2,557	$	-	$	15,308
Grade 5		-		50		31		-		-		-		204		-		285
Grade 6		-		-		-		-		-		-		-		-		-
Grade 7		-		-		-		-		-		-		-		-		-
Grade 8		-		-		-		-		-		-		-		-		-
Total	$	1,901	$	169	$	604	$	483	$	605	$	9,070	$	2,761	$	-	$	15,593
Current-period gross charge-offs	$	-	$	-	$	-	$	-	$	-	$	-	$	92	$	-	$	92
Total Loans	$	492,591	$	440,382	$	607,120	$	681,429	$	432,776	$	592,088	$	272,539	$	-	$	3,518,925
Total current-period gross charge-offs	$	88	$	15	$	13	$	308	$	3	$	47	$	92	$	-	$	566

Loans that were both experiencing financial difficulty and were modified during the six months ended June 30, 2025 and 2024, were insignificant to these consolidated financial statements.

18

NOTE 5 – MORTGAGE SERVICING RIGHTS

Loans serviced for others are not included in the accompanying consolidated balance sheets. MSRs are recognized as separate assets when loans sold in the secondary market are sold with servicing retained. The Company utilizes a third-party consulting firm to assist with determining an accurate assessment of the MSRs fair value. The third-party firm collects relevant data points from numerous sources. Some of these data points relate directly to the pricing level or relative value of the mortgage servicing while other data points relate to the assumptions used to derive fair value. In addition, the valuation evaluates specific collateral types, and current and historical performance of the collateral in question. The valuation process focuses on the non-distressed secondary servicing market, common industry practices and current regulatory standards. The primary determinants of the fair value of MSRs are servicing fee percentage, ancillary income, expected loan life or prepayment speeds, discount rates, costs to service, delinquency rates, foreclosure losses and recourse obligations. The valuation data also contains interest rate shock analyses for monitoring fair value changes in differing interest rate environments.

Following is an analysis of activity in the MSR asset:

	Six Months Ended		Year Ended
	June 30, 2025		December 31, 2024
Fair value at beginning of period	$	13,369	$	13,668
Servicing asset additions		706		1,343
Loan payments and payoffs		(898)		(1,735)
Changes in valuation inputs and assumptions used in the valuation model		268		93
Amount recognized through earnings		76		(299)
Fair value at end of period	$	13,445	$	13,369
Unpaid principal balance of loans serviced for others	$	1,173,121	$	1,172,311
Mortgage servicing rights as a percent of loans serviced for others		1.15		1.14

The primary economic assumptions utilized by the Company in measuring the value of MSRs were constant prepayment speeds of 8.0 and 8.2 months as of June 30, 2025 and December 31, 2024, respectively, and discount rates of 10.18% as of each of those periods. The constant prepayment speeds are obtained from publicly available sources for each of the loan programs the Company originates under.

19

NOTE 6 – NOTES PAYABLE

The Company utilizes FHLB advances to fund liquidity. The Company had outstanding balances borrowed from the FHLB of $110.0 million at June 30, 2025 and $135.5 million as of December 31, 2024. The advances, rate, and maturities of FHLB advances were as follows:

			June 30,		December 31,
	Maturity	Rate	2025		2024
Fixed rate, fixed term	06/30/2025	5.16%	$	—	$	25,000
Fixed rate, fixed term	03/23/2026	4.02%		10,000		10,000
Fixed rate, fixed term	05/26/2026	1.95%		5,000		5,000
Fixed rate, fixed term	06/29/2026	4.77%		15,000		15,000
Fixed rate, fixed term	03/23/2027	3.91%		10,000		10,000
Fixed rate, fixed term	06/28/2027	4.57%		15,000		15,000
Fixed rate, fixed term	03/23/2028	3.85%		10,000		10,000
Fixed rate, fixed term	07/05/2028	4.41%		20,000		20,000
Fixed rate, fixed term	07/09/2029	4.31%		25,000		25,000
Fixed rate, fixed term	04/22/2030	0.00%		—		508
				110,000		135,508
Adjustment due to purchase accounting				(85)		(136)
			$	109,915	$	135,372

Future maturities of borrowings were as follows:

	June 30,		December 31,
	2025		2024
1 year or less	$	30,000	$	25,000
1 to 2 years		25,000		30,000
2 to 3 years		10,000		25,000
3 to 4 years		20,000		30,000
4 to 5 years		25,000		25,000
Over 5 years		—		508
	$	110,000	$	135,508

As of June 30, 2025, the Company had borrowing availability at the FHLB totaling $501.6 million in addition to the existing borrowings noted in the tables above.

NOTE 7 – SUBORDINATED NOTES AND JUNIOR SUBORDINATED DEBENTURES

During July 2020, the Company entered into subordinated note agreements with two separate commercial banks. The Company had through December 31, 2020, to borrow funds up to a maximum availability of $6.0 million under each agreement, or $12.0 million total. These notes were issued with 10-year maturities, carry interest at a fixed rate of 5.0% through June 30, 2025, and at a variable rate thereafter, payable quarterly. These notes are callable on or after January 1, 2026 and qualify for Tier 2 capital for regulatory purposes. The Company had outstanding balances of $6.0 million under these agreements at June 30, 2025 and December 31, 2024.

During August 2022, the Company entered into subordinated note agreements with an individual. The Company had outstanding balances of $6.0 million under these agreements as of June 30, 2025 and December 31, 2024. These notes were issued with 10-year maturities, carry interest at a fixed rate of 5.25% through August 6, 2027, and at a variable rate thereafter, payable quarterly. These notes are callable on or after August 6, 2027 and qualify for Tier 2 capital for regulatory purposes.

20

NOTE 8 – REGULATORY MATTERS

Banks and certain bank holding companies are subject to regulatory capital requirements administered by federal banking agencies. Capital adequacy guidelines and, additionally for banks, prompt corrective action regulations involve quantitative measures of assets, liabilities, and certain off-balance sheet items calculated under regulatory accounting practices. Capital amounts and classifications are also subject to qualitative judgments by regulators. Failure to meet capital requirements can initiate regulatory action.

Under regulatory guidance for non-advanced approaches institutions, the Bank and Company are required to maintain minimum amounts and ratios of common equity Tier I capital to risk-weighted assets, including an additional conservation buffer determined by banking regulators. As of June 30, 2025 and December 31, 2024, this buffer was 2.5%. The Bank met all capital adequacy requirements to which they are subject as of June 30, 2025 and December 31, 2024.

Actual and required capital amounts and ratios are presented below at period-end:

													To Be Well
									Minimum Capital				Capitalized Under
					For Capital				Adequacy with				Prompt Corrective
	Actual				Adequacy Purposes				Capital Buffer				Action Provisions
	Amount		Ratio		Amount		Ratio		Amount		Ratio		Amount		Ratio
June 30, 2025
Total capital (to risk-weighted assets):
Company	$	483,515	13.08	%	$	295,630	8.00	%	$	388,014	10.50	%		NA	NA
Bank	$	450,082	12.19	%	$	295,422	8.00	%	$	387,741	10.50	%	$	369,277	10.00	%
Tier 1 capital (to risk-weighted assets):
Company	$	428,868	11.61	%	$	221,723	6.00	%	$	314,107	8.50	%		NA	NA
Bank	$	407,435	11.03	%	$	221,566	6.00	%	$	313,886	8.50	%	$	295,422	8.00	%
Common Equity Tier 1 capital (to risk-weighted assets):
Company	$	428,868	11.61	%	$	166,292	4.50	%	$	258,676	7.00	%		NA	NA
Bank	$	407,435	11.03	%	$	166,175	4.50	%	$	258,494	7.00	%	$	240,030	6.50	%
Tier 1 capital (to average assets):
Company	$	428,868	10.16	%	$	168,813	4.00	%	$	168,813	4.00	%		NA	NA
Bank	$	407,435	9.66	%	$	168,765	4.00	%	$	168,765	4.00	%	$	210,956	5.00	%
December 31, 2024
Total capital (to risk-weighted assets):
Company	$	509,763	14.14	%	$	288,325	8.00	%	$	378,427	10.50	%		NA	NA
Bank	$	438,549	12.18	%	$	288,152	8.00	%	$	378,200	10.50	%	$	360,190	10.00	%
Tier 1 capital (to risk-weighted assets):
Company	$	457,749	12.70	%	$	216,244	6.00	%	$	306,346	8.50	%		NA	NA
Bank	$	398,535	11.06	%	$	216,114	6.00	%	$	306,162	8.50	%	$	288,152	8.00	%
Common Equity Tier 1 capital (to risk-weighted assets):
Company	$	457,749	12.70	%	$	162,183	4.50	%	$	252,285	7.00	%		NA	NA
Bank	$	398,535	11.06	%	$	162,086	4.50	%	$	252,133	7.00	%	$	234,124	6.50	%
Tier 1 capital (to average assets):
Company	$	457,749	10.96	%	$	167,134	4.00	%	$	167,134	4.00	%		NA	NA
Bank	$	398,535	9.54	%	$	167,019	4.00	%	$	167,019	4.00	%	$	208,774	5.00	%

21

NOTE 9 – SEGMENT INFORMATION

The Company’s single reportable segment is determined by the Chief Executive Officer, who is the designated chief operating decision maker, based upon information provided by the Company’s products and services offered, primarily banking operations. The segment is also distinguished by the level of information provided to the chief operating decision maker, who uses such information to review the performance of various components of the business such as branches, which are then aggregated as operating performance, products and services, and customers are similar. The chief operating decision maker will then evaluate the financial performance of the Company’s business components such as by evaluating significant revenues and expenses and budget to actual results in assessing the Company’s segment and in the determination of allocating resources. The chief decision maker uses revenue streams to evaluate product pricing and significant expenses to assess performance and evaluate return on assets. The chief decision maker uses consolidated net income and return on assets to benchmark the Company against its competitors. The benchmarking analysis, coupled with monitoring of budget to actual results, are used in the assessment of performance and in establishing compensation. Loans, investments, service charges, and deposits in other banks provide the significant revenues in the banking operation. Interest expense, provisions for credit losses, data processing and payroll provide the significant expenses in the banking operation. All operations are domestic. Information reported internally for performance assessment by the chief operating decision maker is identical to that which is shown in the Consolidated Statements of Income.

NOTE 10 – COMMITMENTS AND CONTINGENCIES

The Company enters into commitments to originate loans whereby the interest rate on the loan is determined prior to funding (rate-lock commitments). Rate-lock commitments on mortgage loans that are intended to be sold are considered to be derivatives. Accordingly, such commitments, along with any related fees received from potential borrowers, are recorded at fair value in derivative assets or liabilities, with changes in fair value recorded in the net gain or loss on sale of mortgage loans. Fair value is based on fees currently charged to enter into similar agreements and for fixed rate commitments also considers the difference between current levels of interest rates and committed rates. The notional amount of rate-lock commitments at June 30, 2025 and December 31, 2024 was approximately $15.9 million and $8.2 million, respectively. The fair value of these rate-lock commitments are not material to these financial statements and have not been recorded.

The Company is party to financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of its customers. These instruments involve, to varying degrees, elements of credit risk in excess of the amount recognized in the consolidated balance sheets.

The Company’s exposure to credit loss is represented by the contractual or notional amount of these commitments. The Company follows the same credit policies in making commitments as it does for on-balance-sheet instruments. Since some of the commitments are expected to expire without being drawn upon and some of the commitments may not be drawn upon to the total extent of the commitment, the notional amount of these commitments does not necessarily represent future cash requirements.

The following commitments were outstanding:

	Notional Amount
	June 30, 2025		December 31, 2024
Commitments to extend credit:
Fixed	$	33,826	$	46,856
Variable		699,600		706,353
Credit card arrangements		24,985		24,399
Letters of credit		9,384		11,055

22

NOTE 11 – FAIR VALUE MEASUREMENTS

Accounting guidance establishes a fair value hierarchy to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The standard describes three levels of inputs that may be used to measure fair value.

Level 1:        Quoted prices (unadjusted) or identical assets or liabilities in active markets that the entity has the ability to access as of the measurement date.

Level 2:        Significant other observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.

Level 3:        Significant unobservable inputs that reflect a reporting entity’s own assumptions about the assumptions that market participants would use in pricing an asset or liability.

Information regarding the fair value of assets measured at fair value on a recurring basis is as follows:

	Instruments		Markets		Other		Significant
	Measured		for Identical		Observable		Unobservable
	At Fair		Assets		Inputs		Inputs
	Value		(Level 1)		(Level 2)		(Level 3)
June 30, 2025
Assets
Securities available for sale
Obligations of U.S. Government sponsored agencies	$	22,268	$	—	$	22,268	$	—
Obligations of states and political subdivisions		55,363		—		55,363		—
Mortgage-backed securities		75,034		—		75,034		—
Corporate notes		14,544		—		14,544		—
Mortgage servicing rights		13,445		—		13,445		—
December 31, 2024
Assets
Securities available for sale
U.S. Treasury securities	$	99,656	$	99,656	$	—	$	—
Obligations of U.S. Government sponsored agencies		24,741		—		24,741		—
Obligations of states and political subdivisions		56,357		—		56,357		—
Mortgage-backed securities		27,993		—		27,993		—
Corporate notes		14,314		—		14,314		—
Mortgage servicing rights		13,369		—		13,369		—

There were no assets measured on a recurring basis using significant unobservable inputs (Level 3) during these periods. Furthermore, there were no liabilities measured on a recurring basis during the periods.

23

Information regarding the fair value of assets measured at fair value on a non-recurring basis is as follows:

			Quoted Prices
			In Active		Significant
	Assets		Markets		Other		Significant
	Measured		for Identical		Observable		Unobservable
	At Fair		Assets		Inputs		Inputs
	Value		(Level 1)		(Level 2)		(Level 3)
June 30, 2025
Loans individually evaluated, net of reserve	$	10,896	$	—	$	—	$	10,896
December 31, 2024
OREO	$	741	$	—	$	—	$	741
Loans individually evaluated, net of reserve		6,194		—		—		6,194
	$	6,935	$	—	$	—	$	6,935

The following is a description of the valuation methodologies used by the Company for the items noted in the table above, including the general classification of such instruments in the fair value hierarchy. For loans individually evaluated, the amount of reserve is based upon the present value of expected future cash flows discounted at the loan’s effective interest rate, the estimated fair value of the underlying collateral for collateral-dependent loans, or the estimated liquidity of the note. For OREO, the fair value is based upon the estimated fair value of the underlying collateral adjusted for the expected costs to sell.

The following table shows significant unobservable inputs used in the fair value measurement of Level 3 assets:

					Weighted
		Unobservable	Range of		Average
	Valuation Technique	Inputs	Discounts		Discount
As of June 30, 2025
Loans individually evaluated	Third party appraisals and discounted cash flows	Collateral discounts and discount rates	0% - 100	%	21	%
As of December 31, 2024
OREO	Third party appraisals, sales contracts or brokered price options	Collateral discounts and estimated costs to sell	0	%	0	%
Loans individually evaluated	Third party appraisals and discounted cash flows	Collateral discounts and discount rates	0% - 100	%	28	%

24

The carrying value and estimated fair value of financial instruments not measured and reported at fair value on a recurring or non-recurring basis at June 30, 2025 and December 31, 2024 are as follows:

	Carrying
June 30, 2025	amount		Level 1		Level 2		Level 3		Total
Financial assets:
Cash and cash equivalents	$	120,328	$	120,328	$	—	$	—	$	120,328
Securities held to maturity		109,854		108,027		2,395		—		110,422
Loans held for sale		5,268		—		5,268		—		5,268
Loans, net		3,536,065		—		—		3,393,648		3,393,648
Other investments		23,227		—		—		23,227		23,227
Financial liabilities:
Deposits	$	3,595,424	$	—	$	—	$	3,304,035	$	3,304,035
Notes payable		109,915		—		109,915		—		109,915
Subordinated notes		12,000		—		12,000		—		12,000

	Carrying
December 31, 2024	amount		Level 1		Level 2		Level 3		Total
Financial assets:
Cash and cash equivalents	$	261,332	$	261,332	$	—	$	—	$	261,332
Securities held to maturity		110,756		106,229		3,195		—		109,424
Loans held for sale		3,088		—		3,088		—		3,088
Loans, net		3,473,017		—		—		3,285,498		3,285,498
Other investments		22,643		—		—		22,643		22,643
Financial liabilities:
Deposits	$	3,661,073	$	—	$	—	$	3,388,650	$	3,388,650
Notes payable		135,372		—		135,372		—		135,372
Subordinated notes		12,000		—		12,000		—		12,000

The fair value of a financial instrument is the current amount that would be exchanged between willing parties, other than in a forced liquidation. Fair value is best determined based upon quoted market prices. However, in many instances, there are no quoted market prices for the Company’s various financial instruments. In cases where quoted market prices are not available, fair values are based on estimates using present value or other valuation techniques. Those techniques are significantly affected by the assumptions used, including the discount rate and estimates of future cash flows. Accordingly, the fair value estimates may not be realized in an immediate settlement of the instrument. Consequently, the aggregate fair value amounts presented may not necessarily represent the underlying fair value of the Company.

Fair value estimates are made at a specific point in time based on relevant market information and information about the financial instrument. These estimates do not reflect any premium or discount that could result from offering for sale at one time the Company’s entire holdings of a particular instrument. Because no market exists for a significant portion of the Company’s financial instruments, fair value estimates are based on judgments regarding future expected loss experience, current economic conditions, risk characteristics of various financial instruments, and other factors. These estimates are subjective in nature and involve uncertainties and matters that could affect the estimates. Fair value estimates are based on existing on- and off-balance-sheet financial instruments without attempting to estimate the value of anticipated future business and the value of assets and liabilities that are not considered financial instruments.

Deposits with no stated maturities are defined as having a fair value equivalent to the amount payable on demand. This prohibits adjusting fair value derived from retaining those deposits for an expected future period of time. This component, commonly referred to as a deposit base intangible, is neither considered in the above amounts nor is it recorded as an intangible asset on the consolidated balance sheet. Significant assets and liabilities that are not considered financial assets and liabilities include premises and equipment. In addition, the tax ramifications related to the realization of the unrealized gains and losses can have a significant effect on fair value estimates and have not been considered in the estimates.

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NOTE 12 – STOCK BASED COMPENSATION

The Company has made restricted share grants pursuant to the Bank First Corporation 2011 Equity Plan and the Bank First Corporation 2020 Equity Plan, which replaced the 2011 Plan. The purpose of the Plan is to provide financial incentives for selected employees and for the non-employee Directors of the Company, thereby promoting the long-term growth and financial success of the Company. The number of shares of Company stock that may be issued pursuant to awards under the 2020 Plan shall not exceed, in the aggregate, 700,000. As of June 30, 2025, 124,570 shares of Company stock have been awarded under the 2020 Plan. Compensation expense for restricted stock is based on the fair value of the awards of Bank First Corporation common stock at the time of grant. The value of restricted stock grants that are expected to vest is amortized into expense over the vesting periods. For the three months ended June 30, 2025 and 2024, compensation expense of $0.5 million and $0.5 million, respectively, was recognized related to restricted stock awards. For the six months ended June 30, 2025 and 2024, compensation expense of $1.0 million and $1.1 million, respectively, was recognized related to restricted stock awards.

As of June 30, 2025, there was $3.3 million of unrecognized compensation cost related to non-vested restricted stock awards granted under the plan. That cost is expected to be recognized over a weighted average period of 1.75 years. The aggregate grant date fair value of restricted stock awards that vested during the six months ended June 30, 2025, was approximately $2.1 million.

	For the period ended			For the period ended
	June 30, 2025			June 30, 2024
		Weighted-			Weighted-
		Average Grant-			Average Grant-
	Shares	Date Fair Value		Shares	Date Fair Value
Restricted Stock
Outstanding at beginning of period	52,634	$	79.27	58,196	$	72.28
Granted	23,616		105.76	24,581		85.85
Vested	(28,290)		75.74	(30,143)		71.14
Forfeited or cancelled	(1,233)		80.17	—		—
Outstanding at end of period	46,727	$	94.77	52,634	$	79.27

NOTE 13 – SUBSEQUENT EVENT

On July 18, 2025, the Company entered into an Agreement and Plan of Merger with Centre 1 Bancorp, Inc., the parent company of First National Bank and Trust Company (“FNBT”), a community bank headquartered in Beloit, Wisconsin. Under the terms of the agreement, Centre 1 Bancorp will merge with and into the Company, and FNBT will merge with and into the Bank. The transaction is expected to close on January 1, 2026, subject to customary closing conditions including regulatory approvals. Merger consideration will consist of common stock of the Company, with final terms based on the fair market value of the Company’s common stock at closing. Based on combined results as of June 30, 2025, the merged entity would have total assets of approximately $5.9 billion, loans of approximately $4.6 billion, and deposits of approximately $4.9 billion.

re

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our audited consolidated financial statements for the year ended December 31, 2024, included in our Annual Report and with our unaudited condensed accompanying notes set forth in this Quarterly Report on Form 10-Q for the quarterly period June 30, 2025.

FORWARD-LOOKING STATEMENTS

Certain statements contained in this report are forward-looking statements within the meaning of and subject to the safe harbor protections of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, without limitation, statements relating to the Company’s assets, business, cash flows, condition (financial or otherwise), credit quality, financial performance, liquidity, short and long-term performance goals, prospects, results of operations, strategic initiatives, potential future acquisitions, disposition and other growth opportunities. These statements, which are based upon certain assumptions and estimates and describe the Company’s future plans, results, strategies and expectations, can generally be identified by the use of the words and phrases “may,” “will,” “should,” “could,” “would,” “goal,” “plan,” “potential,” “estimate,” “project,” “believe,” “intend,” “anticipate,” “expect,” “target,” “aim,” “predict,” “continue,” “seek,” “projection” and other variations of such words and phrases and similar expressions. These forward-looking statements are not historical facts, and are based upon current expectations, estimates and projections about the Company’s industry, management’s beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond the Company’s control. The inclusion of these forward-looking statements should not be regarded as a representation by the Company or any other person that such expectations, estimates and projections will be achieved. Accordingly, the Company cautions investors that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions and uncertainties that are difficult to predict and that are beyond the Company’s control. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable as of the date of this report, actual results may prove to be materially different from the results expressed or implied by the forward-looking statements. A number of factors could cause actual results to differ materially from those contemplated by the forward-looking statement in this report including, without limitation, the risks and other factors set forth in the Company’s Registration Statements under the captions “Cautionary Note Regarding Forward-Looking Statements” and “Risk factors.” Many of these factors are beyond the Company’s ability to control or predict. If one or more events related to these or other risks or uncertainties materialize, or if the Company’s underlying assumptions prove to be incorrect, actual results may differ materially from the forward-looking statements. Accordingly, investors should not place undue reliance on any such forward-looking statements. Any forward-looking statements speaks only as of the date of this report, and the Company does not undertake any obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise, except as required by law. New risks and uncertainties may emerge from time to time, and it is not possible for the Company to predict their occurrence or how they will affect the Company.

We qualify all of our forward-looking statements by these cautionary statements.

OVERVIEW

Bank First Corporation is a Wisconsin corporation that was organized primarily to serve as the holding company for Bank First, N.A. Bank First, N.A., which was incorporated in 1894, is a nationally-chartered bank headquartered in Manitowoc, Wisconsin. It is a member of the Board of Governors of the Federal Reserve System (“Federal Reserve”), and is regulated by the Office of the Comptroller of the Currency (“OCC”). Including its headquarters in Manitowoc, Wisconsin, the Bank has twenty-seven banking locations in Manitowoc, Outagamie, Brown, Winnebago, Sheboygan, Shawano, Waupaca, Ozaukee, Monroe, Fond du Lac, Waushara, Dane, Columbia, Door and Jefferson counties in Wisconsin. The Bank offers loan, deposit and treasury management products at each of its banking locations.

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As with most community banks, the Bank derives a significant portion of its income from interest received on loans and investments. The Bank’s primary source of funding is deposits, both interest-bearing and noninterest-bearing. In order to maximize the Bank’s net interest income, or the difference between the income on interest-earning assets and the expense of interest-bearing liabilities, the Bank must not only manage the volume of these balance sheet items, but also the yields earned on interest-earning assets and the rates paid on interest-bearing liabilities. To account for credit risk inherent in all loans, the Bank maintains an ACL - Loans to absorb possible losses on existing loans that may become uncollectible. The Bank establishes and maintains this allowance by charging a provision for credit losses against operating earnings. Beyond its net interest income, the Bank further receives income through the net gain on sale of loans held for sale as well as servicing income which is retained on those sold loans. In order to maintain its operations and bank locations, the Bank incurs various operating expenses which are further described within the “Results of Operations” later in this section.

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SELECTED HISTORICAL CONSOLIDATED FINANCIAL DATA

The following tables present certain selected historical consolidated financial data as of the dates or for the period indicated:

	At or for the Three Months Ended										At or for the Six Months Ended
(In thousands, except per share data)	6/30/2025		3/31/2025		12/31/2024		9/30/2024		6/30/2024		6/30/2025		6/30/2024
Results of Operations:
Interest income	$	54,575	$	55,048	$	53,754	$	54,032	$	49,347	$	109,623	$	98,619
Interest expense		17,873		18,511		18,193		18,149		16,340		36,384		32,263
Net interest income		36,702		36,537		35,561		35,883		33,007		73,239		66,356
Provision for credit losses		200		400		(1,000)		—		—		600		200
Net interest income after provision for credit losses		36,502		36,137		36,561		35,883		33,007		72,639		66,156
Noninterest income		4,921		6,588		4,513		4,893		5,877		11,509		10,274
Noninterest expense		20,756		20,604		19,286		20,100		19,057		41,360		39,381
Income before income tax expense		20,667		22,121		21,788		20,676		19,827		42,788		37,049
Income tax expense		3,792		3,880		4,248		4,124		3,768		7,672		5,578
Net income	$	16,875	$	18,241	$	17,540	$	16,552	$	16,059	$	35,116	$	31,471
Earnings per common share - basic	$	1.71	$	1.82	$	1.75	$	1.65	$	1.59	$	3.53	$	3.10
Earnings per common share - diluted		1.71		1.82		1.75		1.65		1.59		3.53		3.10
Common Shares:
Basic weighted average		9,854,306		9,950,970		9,959,379		9,959,556		10,025,977		9,901,990		10,101,491
Diluted weighted average		9,868,739		9,972,152		9,988,781		9,980,544		10,039,862		9,922,369		10,122,564
Outstanding		9,833,476		9,973,276		10,012,088		10,011,428		10,031,350		9,833,476		10,031,350
Noninterest income / noninterest expense:
Service charges	$	2,053	$	2,011	$	2,119	$	2,189	$	2,101	$	4,064	$	3,735
Income from Ansay		1,153		1,181		82		1,062		1,379		2,334		2,358
Loan servicing income		733		732		744		733		735		1,465		1,461
Valuation adjustment on mortgage servicing rights		(99)		175		18		(344)		339		76		27
Net gain on sales of mortgage loans		338		334		424		377		277		672		496
Other noninterest income		743		2,155		1,126		876		1,046		2,898		2,197
Total noninterest income	$	4,921	$	6,588	$	4,513	$	4,893	$	5,877	$	11,509	$	10,274
Personnel expense	$	10,427	$	10,985	$	9,886	$	10,118	$	10,004	$	21,412	$	20,897
Occupancy, equipment and office		1,922		1,591		1,445		1,598		1,330		3,513		2,914
Data processing		2,620		2,444		2,687		2,502		2,114		5,064		4,503
Postage, stationery and supplies		270		240		229		213		205		510		443
Net gain (loss) on sales and valuations of other real estate owned		(159)		—		(186)		—		(461)		(159)		(508)
Net loss on sales of securities		—		—		—		—		—		—		34
Advertising		61		65		78		61		79		126		174
Charitable contributions		274		476		200		183		234		750		410
Federal deposit insurance		630		630		495		495		443		1,260		860
Outside service fees		1,135		788		1,135		1,103		1,446		1,923		2,322
Amortization of intangibles		1,273		1,298		1,389		1,429		1,475		2,571		2,975
Other noninterest expense		2,303		2,087		1,928		2,398		2,188		4,390		4,357
Total noninterest expense	$	20,756	$	20,604	$	19,286	$	20,100	$	19,057	$	41,360	$	39,381
Period-end balances:
Cash and cash equivalents	$	120,328	$	300,865	$	261,332	$	204,427	$	98,950	$	120,328	$	98,950
Investment securities available-for-sale, at fair value		167,209		163,743		223,061		128,438		127,977		167,209		127,977
Investment securities held-to-maturity, at cost		109,854		110,241		110,756		109,236		110,648		109,854		110,648
Loans		3,580,357		3,548,070		3,517,168		3,470,920		3,428,635		3,580,357		3,428,635
Allowance for credit losses - loans		(44,292)		(43,749)		(44,151)		(45,212)		(45,118)		(44,292)		(45,118)
Premises and equipment		75,667		72,670		71,108		69,710		68,633		75,667		68,633
Goodwill and other intangibles, net		193,738		195,011		196,309		197,698		199,127		193,738		199,127
Mortgage Servicing Rights		13,445		13,544		13,369		13,351		13,694		13,445		13,694
Other Assets		148,776		144,670		146,108		145,930		143,274		148,776		143,274
Total assets		4,365,082		4,505,065		4,495,060		4,294,498		4,145,820		4,365,082		4,145,820
Deposits		3,595,424		3,674,218		3,661,073		3,484,741		3,399,941		3,595,424		3,399,941
Borrowings		121,915		146,890		147,372		147,346		102,321		121,915		102,321
Other liabilities		35,410		35,543		46,932		33,516		28,979		35,410		28,979
Total liabilities		3,752,749		3,856,651		3,855,377		3,665,603		3,531,241		3,752,749		3,531,241
Stockholders’ equity		612,333		648,414		639,683		628,895		614,579		612,333		614,579
Book value per common share		62.27		65.02		63.89		62.82		61.27		62.27		61.27
Tangible book value per common share (1)		42.57		45.46		44.28		43.07		41.42		42.57		41.42

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Average balances:
Loans	$	3,560,945		$	3,541,995		$	3,482,974		$	3,450,423		$	3,399,906		$	3,551,522		$	3,377,526
Interest-earning assets		4,006,981			4,100,846			3,962,690			3,833,968			3,696,099			4,053,653			3,718,801
Total assets		4,407,112			4,498,891			4,360,469			4,231,112			4,094,542			4,452,748			4,119,719
Deposits		3,596,755			3,672,039			3,545,694			3,435,172			3,401,828			3,634,190			3,423,985
Interest-bearing liabilities		2,762,544			2,837,182			2,655,609			2,583,382			2,466,726			2,799,658			2,489,514
Goodwill and other intangibles, net		194,503			195,752			196,966			198,493			199,959			195,124			200,684
Stockholders’ equity		623,861			645,708			634,137			620,821			610,818			634,724			612,004
Financial ratios (2):
Return on average assets		1.54	%		1.64	%		1.60	%		1.56	%		1.58	%		1.59	%		1.54	%
Return on average common equity		10.85	%		11.46	%		11.00	%		10.61	%		10.57	%		11.16	%		10.34	%
Average equity to average assets		14.16	%		14.35	%		14.54	%		14.67	%		14.92	%		14.25	%		14.86	%
Stockholders’ equity to assets		14.03	%		14.39	%		14.23	%		14.64	%		14.82	%		14.03	%		14.82	%
Tangible equity to tangible assets (1)		10.04	%		10.52	%		10.31	%		10.53	%		10.53	%		10.04	%		10.53	%
Loan yield		5.66	%		5.68	%		5.56	%		5.73	%		5.51	%		5.67	%		5.46	%
Earning asset yield		5.50	%		5.49	%		5.44	%		5.64	%		5.40	%		5.50	%		5.37	%
Cost of funds		2.59	%		2.65	%		2.73	%		2.79	%		2.66	%		2.62	%		2.61	%
Net interest margin, taxable equivalent		3.72	%		3.65	%		3.61	%		3.76	%		3.63	%		3.69	%		3.62	%
Net loan charge-offs to average loans		—	%		0.09	%		0.01	%		0.04	%		(0.05)	%		0.05	%		(0.05)	%
Nonperforming loans to total loans		0.38	%		0.19	%		0.24	%		0.32	%		0.31	%		0.38	%		0.31	%
Nonperforming assets to total assets		0.31	%		0.17	%		0.21	%		0.28	%		0.27	%		0.31	%		0.27	%
Allowance for credit losses - loans to total loans		1.24	%		1.23	%		1.26	%		1.30	%		1.32	%		1.24	%		1.32	%

(1) These measures are not measures prepared in accordance with GAAP, and are therefore considered to be non-GAAP financial measures. See “GAAP reconciliation and management explanation of non-GAAP financial measures” for a reconciliation of these measures to their most comparable GAAP measures.

(2) Income statement-related ratios for partial year periods are annualized.

GAAP RECONCILIATION AND MANAGEMENT EXPLANATION OF NON-GAAP FINANCIAL MEASURES

We identify certain financial measures discussed in the Report as being “non-GAAP financial measures.” The non-GAAP financial measures presented in this Report are tangible book value per common share and tangible equity to tangible assets.

In accordance with the SEC’s rules, we classify a financial measure as being a non-GAAP financial measure if that financial measure excludes or includes amounts, or is subject to adjustments that have the effect of excluding or including amounts, that are included or excluded, as the case may be, in the most directly comparable measure calculated and presented in accordance with GAAP as in effect from time to time in the United States in our statements of income, balance sheets or statements of cash flows.

The non-GAAP financial measures that we discuss in this Report should not be considered in isolation or as a substitute for the most directly comparable or other financial measures calculated in accordance with GAAP. Moreover, the manner in which we calculate the non-GAAP financial measures that we discuss in our selected historical consolidated financial data may differ from that of other companies reporting measures with similar names. You should understand how such other banking organizations calculate their financial measures similar or with names similar to the non-GAAP financial measures we have presented in our selected historical consolidated financial data when comparing such non-GAAP financial measures. The following discussion and reconciliations provide a more detailed analysis of these non-GAAP financial measures.

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Tangible book value per common share and tangible equity to tangible assets are non-GAAP measures that exclude the impact of goodwill and other intangibles used by the Company’s management to evaluate capital adequacy. Because intangible assets such as goodwill and other intangibles vary extensively from company to company, we believe that the presentation of this information allows investors to more easily compare the Company’s capital position to other companies. The most directly comparable financial measures calculated in accordance with GAAP are book value per common share, return on average common equity and stockholders’ equity to total assets.

	At or for the Three Months Ended															At or for the Six Months Ended
(In thousands, except per share data)	6/30/2025			3/31/2025			12/31/2024			9/30/2024			6/30/2024			6/30/2025			6/30/2024
Tangible Assets
Total assets	$	4,365,082		$	4,505,065		$	4,495,060		$	4,294,498		$	4,145,820		$	4,365,082		$	4,145,820
Adjustments:
Goodwill		(175,106)			(175,106)			(175,106)			(175,106)			(175,106)			(175,106)			(175,106)
Core deposit intangible, net of amortization		(18,632)			(19,905)			(21,203)			(22,592)			(24,021)			(18,632)			(24,021)
Tangible assets	$	4,171,344		$	4,310,054		$	4,298,751		$	4,096,800		$	3,946,693		$	4,171,344		$	3,946,693
Tangible Common Equity
Total stockholders’ equity	$	612,333		$	648,414		$	639,683		$	628,895		$	614,579		$	612,333		$	614,579
Adjustments:
Goodwill		(175,106)			(175,106)			(175,106)			(175,106)			(175,106)			(175,106)			(175,106)
Core deposit intangible, net of amortization		(18,632)			(19,905)			(21,203)			(22,592)			(24,021)			(18,632)			(24,021)
Tangible common equity	$	418,595		$	453,403		$	443,374		$	431,197		$	415,452		$	418,595		$	415,452
Book value per common share	$	62.27		$	65.02		$	63.89		$	62.82		$	61.27		$	62.27		$	61.27
Tangible book value per common share		42.57			45.46			44.28			43.07			41.42			42.57			41.42
Total stockholders’ equity to total assets		14.03	%		14.39	%		14.23	%		14.64	%		14.82	%		14.03	%		14.82	%
Tangible common equity to tangible assets		10.04	%		10.52	%		10.31	%		10.53	%		10.53	%		10.04	%		10.53	%

RESULTS OF OPERATIONS

Results of Operations for the Three Months Ended June 30, 2025 and June 30, 2024

General. Net income increased $0.8 million to $16.9 million for three months ended June 30, 2025, compared to $16.1 million for the same period in 2024. This increase is primarily driven from new and renewed loans pricing at higher yields while deposits, particularly certificates, continue to reprice lower. Average balances of interest-earning assets grew $0.3 million period-over-period, amplifying the impact of higher yields on these new and renewed loans.

Net Interest Income. The management of interest income and expense is fundamental to our financial performance. Net interest income, the difference between interest income and interest expense, is the largest component of the Company’s total revenue. Management closely monitors both total net interest income and the net interest margin (net interest income divided by average earning assets). We seek to maximize net interest income without exposing the Company to an excessive level of interest rate risk through our asset and liability policies. Interest rate risk is managed by monitoring the pricing, maturity and repricing options of all classes of interest-bearing assets and liabilities. Our net interest margin can also be adversely impacted by the reversal of interest on nonaccrual loans and the reinvestment of loan payoffs into lower yielding investment securities and other short-term investments.

Net interest and dividend income increased by $3.7 million to $36.7 million for the three months ended June 30, 2025 compared to $33.0 million for three months ended June 30, 2024. Total average interest-earning assets were $4.01 billion for the three months ended June 30, 2025, up from $3.70 billion for the same period in 2024. Net interest margin and net interest income are influenced by internal and external factors. Internal factors include balance sheet changes on both volume and mix and pricing decisions, and external factors include changes in market interest rates, competition and the shape of the interest rate yield curve.

Interest Income. Total interest income increased $5.3 million, or 10.6%, to $54.6 million for the three months ended June 30, 2025 compared to $49.3 million for the same period in 2024. The increase in total interest income was primarily due to an increase in in interest-earning assets coupled with higher average interest rates earned on interest-earning assets. The average balance of interest-earning assets increased by $310.9 million during the three months ended June 30, 2025 compared to the same period in 2024 and the average interest rate earned on these assets increased by 0.10% in the year-over-year second quarters.

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Interest Expense. Interest expense increased $1.6 million, or 9.4%, to $17.9 million for the three months ended June 30, 2025 compared to $16.3 million for the same period in 2024. The increase in interest expense was primarily due to higher levels of interest-bearing liabilities.

Interest expense on interest-bearing deposits increased by $0.4 million to $16.2 million for the three months ended June 30, 2025 compared to $15.8 million for the same period in 2024. The average balance and rate of interest-bearing deposits was $2.62 billion and 2.48% for the three months ended June 30, 2025, compared to $2.42 billion and 2.63% for the same period in 2024. The Bank's cost of funds decreased by 0.07% from the second quarter of 2024, including a decrease of 0.44% in the average rate paid on the Bank's interest checking and 0.35% in average rate paid on the Bank’s certificate of deposits.

Provision for Credit Losses. Credit risk is inherent in the business of making loans. We establish an allowance for credit losses through charges to earnings, which are shown in the statements of operations as the provision for credit losses. The provision for credit losses and level of allowance for each period are dependent upon many factors, including loan growth, net charge-offs, changes in the composition of the loan portfolio, delinquencies, management’s assessment of the quality of the loan portfolio, the valuation of problem loans and the general economic conditions in our market area. The determination of the amount is complex and involves a high degree of judgment and subjectivity.

We recorded a provision of $0.2 million for credit loss during the three months ended June 30, 2025 compared to no provision for credit loss during the same period in 2024. Economic forecasts, primarily US gross domestic product projections, decreased slightly during the second quarter of 2025 while projections for unemployment increased. We recorded minimal net charge-offs during the three months ended June 30, 2025 compared to net recoveries of $0.2 million during the three months ended June 30, 2024. Also, due to a reduction in unfunded loan commitments and an increase in outstanding loans, the Bank moved $0.4 million from its ACL-Unfunded Commitments to its ACL – Loans during the second quarter of 2025. The Bank’s loan portfolio continues to exhibit very little credit stress. The ACL - Loans was $44.3 million, or 1.24% of total loans, at June 30, 2025 compared to $45.1 million, or 1.32% of total loans at June 30, 2024.

Noninterest Income. Noninterest income is an important component of our total revenues. A significant portion of our noninterest income has historically been associated with service charges and income from the Bank’s unconsolidated subsidiary, Ansay. Other sources of noninterest income include loan servicing fees and gains on sales of mortgage loans.

Noninterest income decreased $1.0 million to $4.9 million for the three months ended June 30, 2025 compared to $5.9 million for the same period in 2024. Income provided by the Bank’s investment in Ansay & Associates, LLC totaled $1.2 million during the second quarter of 2025, down $0.2 million from the prior-year second quarter. Negative valuation adjustments to the Bank’s MSRs totaling $0.1 million during the second quarter of 2025 compared negatively to $0.3 million in positive valuation adjustments during the second quarter of 2024. Finally, the Bank benefited from a $0.4 million gain during the second quarter of 2024 from death benefits on bank-owned life insurance policies, creating a negative variance year-over-year in other non-interest income for the second quarter.

The major components of our noninterest income are listed below:

	Three Months Ended June 30,
	2025		2024		$ Change		% Change
(in thousands)	(In thousands)
Noninterest Income
Service charges	$	2,053	$	2,101	$	(48)		(2)	%
Income from Ansay		1,153		1,379		(226)		(16)	%
Loan servicing income		733		735		(2)		(0)	%
Valuation adjustment on MSR		(99)		339		(438)		NM
Net gain on sales of mortgage loans		338		277		61		22	%
Other		743		1,046		(303)		(29)	%
Total noninterest income	$	4,921	$	5,877	$	(956)		(16)	%

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Noninterest Expense. Noninterest expense increased $1.7 million to $20.8 million for the three months ended June 30, 2025 compared to $19.1 million for the same period in 2024. Occupancy, equipment and office expense was elevated during the second quarter of 2025, up $0.6 million from the prior-year second quarter, the result of expenses from multiple branch remodels and the opening of a new branch in Sturgeon Bay, WI during the most recent quarter. Data processing expense was once again impacted in the most recent quarter by elevated expenditures related to the Bank’s upgrade of its digital banking platform. Outside service fees declined by $0.3 million in the most recent quarter compared to the second quarter of 2024. Included in outside service fees during the second quarter of 2025 was $0.1 million in commission expense from the sale of a former branch, which generated a $0.2 million gain. By contrast, the second quarter of 2024 included $0.4 million in commission expense from former branch sales, resulting in $0.5 million in gains.

The major components of our noninterest expense are listed below:

	Three Months Ended June 30,
	2025		2024		$ Change		% Change
	(In thousands)
Noninterest Expense
Salaries, commissions, and employee benefits	$	10,427	$	10,004	$	423	4	%
Occupancy		1,922		1,330		592	45	%
Data processing		2,620		2,114		506	24	%
Postage, stationary, and supplies		270		205		65	32	%
Net gain on sales and valuations of other real estate owned		(159)		(461)		302	(66)	%
Advertising		61		79		(18)	(23)	%
Charitable contributions		274		234		40	17	%
Federal deposit insurance		630		443		187	42	%
Outside service fees		1,135		1,446		(311)	(22)	%
Amortization of intangibles		1,273		1,475		(202)	(14)	%
Other		2,303		2,188		115	5	%
Total noninterest expenses	$	20,756	$	19,057	$	1,699	9	%

Income Tax Expense. We recorded a provision for income taxes of $3.8 million for the three months ended June 30, 2025 compared to a provision of $3.8 million for the same period during 2024, reflecting effective tax rates of 18.3% and 19.0%, respectively. The effective tax rates were reduced from the statutory federal and state income tax rates during both periods as a result of tax-exempt interest income produced by certain qualifying loans and investments in the Bank’s portfolios.

Results of Operations for the Six Months Ended June 30, 2025 and June 30, 2024

General. Net income increased $3.6 million to $35.1 million for six months ended June 30, 2025, compared to $31.5 million for the same period in 2024. The Bank’s net income continues to benefit from new and renewed loans being priced at higher yields, while deposits continue to reprice lower.

Net Interest Income. Net interest and dividend income increased by $6.8 million to $73.2 million for the six months ended June 30, 2025 compared to $66.4 million for six months ended June 30, 2024. As discussed earlier, the rise in net interest income was mainly driven by the repricing of new and renewed loans in a higher interest rate environment and overall growth in interest-earning assets. Comparing the first six months of 2025 to the first six months of 2024, rates earned on interest-earning assets increased by 0.13% while average interest-earning assets increased by $334.9 million. Tax equivalent net interest margin increased 0.07% to 3.69% for the six months ended June 30, 2025, up from 3.62% for the same period in 2024. Net interest margin and net interest income are influenced by internal and external factors. Internal factors include balance sheet changes on both volume and mix and pricing decisions, and external factors include changes in market interest rates, competition and the shape of the interest rate yield curve.

Interest Income. Total interest income increased $11.0 million, or 11.2%, to $109.6 million for the six months ended June 30, 2025 compared to $98.6 million for the same period in 2024. The increase in total interest income was primarily due to the aforementioned increase in rates earned on higher average interest-earning assets over recent quarters.

33

Interest Expense. Interest expense increased $4.1 million, or 12.8%, to $36.4 million for the six months ended June 30, 2025 compared to $32.3 million for the same period in 2024. The increase in interest expense was primarily due to elevated balances in average interest-bearing liabilities. The average balance of interest-bearing liabilities increased by $310.1 million during the first six months of 2025 compared to the same period in 2024 and the average interest rate paid on these balances was 2.62% for the first half of 2025 compared to 2.61% for the first half of 2024.

Interest expense on interest-bearing deposits totaled $33.1 million and $31.2 million for the six months ended June 30, 2025 and 2024, respectively. The average cost of interest-bearing deposits was 2.51% for the six months ended June 30, 2025, compared to 2.57% for the same period in 2024.

Provision for Credit Losses. We recorded a provision for credit losses of $0.6 million for the six months ended June 30, 2025 compared to $0.2 million for the same period in 2024. The increased provision for the first six months of 2025 was primarily related to loan growth. We recorded net charge-offs of $0.8 million for the six months ended June 30, 2025 compared to net recoveries of $0.8 million for the same period in 2024. As mentioned earlier, due to a reduction in unfunded loan commitments and an increase in outstanding loans, the Bank also transferred $0.4 million from its ACL-Unfunded Commitments to its ACL – Loans during the first six months of 2025. The ACL - Loans was $44.3 million, or 1.24% of total loans, at June 30, 2025 compared to $45.1 million, or 1.32% of total loans at June 30, 2024.

Noninterest Income. Noninterest income is an important component of our total revenues. A significant portion of our noninterest income has historically been associated with service charges and income from the Bank’s unconsolidated subsidiary, Ansay. Other sources of noninterest income include loan servicing fees and gains on sales of mortgage loans.

Noninterest income increased $1.2 million to $11.5 million for the six months ended June 30, 2025 compared to $10.3 million for the same period in 2024. Service charges increased $0.3 million for the first six months of 2025 compared to the same period in 2024 as the Bank continues to benefit from a vendor incentive program which was renegotiated in the second quarter of 2024 related to credit and debit card payments processing. During the first six months of 2025, the Bank recognized a $1.1 million gain from death benefits tied to its bank-owned life insurance portfolio, compared to $0.4 million in the same period of 2024. These amounts are recorded under other noninterest income.

The major components of our noninterest income are listed below:

	Six Months Ended June 30,
	2025		2024		$ Change		% Change
	(In thousands)
Noninterest Income
Service Charges	$	4,064	$	3,735	$	329	9	%
Income from Ansay		2,334		2,358		(24)	(1)	%
Loan Servicing income		1,465		1,461		4	0	%
Valuation adjustment on MSR		76		27		49	181	%
Net gain on sales of mortgage loans		672		496		176	35	%
Other		2,898		2,197		701	32	%
Total noninterest income	$	11,509	$	10,274	$	1,235	12	%

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Noninterest Expense. Noninterest expense increased $2.0 million to $41.4 million for the six months ended June 30, 2025 compared to $39.4 million for the same period in 2024. Occupancy expense increased by $0.6 million, or 20.6%, over the first half of 2024 due to aforementioned branch construction and remodel projects competed during the first six months of 2025. Data processing expense increased by $0.6 million, or 12.5%, over the first two quarters of 2025 due to the aforementioned elevated expenditures related to the Bank’s upgrade of its digital banking platform. Also, federal deposit insurance increased primarily due to elevated deposit levels which occurred late in the fourth quarter of 2024 and persisted through much of the second quarter of 2025. Finally, gains on sales and valuations of OREO totaling $0.2 million during the first two quarters of 2025 was less than similar gains of $0.5 million during the first two quarters of 2024.

The major components of our noninterest expense are listed below:

	Six Months Ended June 30,
	2025		2024		$ Change		% Change
	(In thousands)
Noninterest Expense
Salaries, commissions, and employee benefits	$	21,412	$	20,897	$	515	2	%
Occupancy		3,513		2,914		599	21	%
Data processing		5,064		4,503		561	12	%
Postage, stationary, and supplies		510		443		67	15	%
Net gain on sales and valuations of other real estate owned		(159)		(508)		349	(69)	%
Net loss on sales of securities		—		34		(34)	(100)	%
Advertising		126		174		(48)	(28)	%
Charitable contributions		750		410		340	83	%
Federal deposit insurance		1,260		860		400	47	%
Outside service fees		1,923		2,322		(399)	(17)	%
Amortization of intangibles		2,571		2,975		(404)	(14)	%
Other		4,390		4,357		33	1	%
Total noninterest expenses	$	41,360	$	39,381	$	1,979	5	%

Income Tax Expense. We recorded a provision for income taxes of $7.7 million for the six months ended June 30, 2025 compared to a provision of $5.6 million for the same period during 2024, reflecting effective tax rates of 17.9% and 15.1%, respectively. The Company’s home state passed tax legislation during the third quarter of 2023 which exempted income from a significant portion of the Company’s loans from taxation in Wisconsin. Final rules relating to qualifying loans under this legislation were not published until the first quarter of 2024. Based on these final rules, the Company was able to further reduce its estimated tax liability from 2023 by $1.3 million, resulting in the lower provision for income taxes and effective tax rate during the first six months of 2024. The effective tax rates were reduced from the statutory federal and state income tax rates during both periods as a result of tax-exempt interest income produced by certain qualifying loans and investments in the Bank’s portfolios.

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NET INTEREST MARGIN

Net interest income represents the difference between interest earned, primarily on loans and investments, and interest paid on funding sources, primarily deposits and borrowings. Interest rate spread is the difference between the average rate earned on total interest-earning assets and the average rate paid on total interest-bearing liabilities. Net interest margin is the amount of net interest income, on a fully taxable-equivalent basis, expressed as a percentage of average interest-earning assets. The average rate earned on earning assets is the amount of annualized taxable-equivalent interest income expressed as a percentage of average earning assets. The average rate paid on interest-bearing liabilities is equal to annualized interest expense as a percentage of average interest-bearing liabilities.

The following tables set forth the distribution of our average assets, liabilities and stockholders’ equity, and average rates earned or paid on a fully taxable equivalent basis for each of the periods indicated:

	Three Months Ended
	June 30, 2025						June 30, 2024
			Interest						Interest
	Average		Income/		Rate Earned/ Paid		Average		Income/		Rate Earned/ Paid
	Balance		Expenses (1)		(1)		Balance		Expenses (1)		(1)
	(dollars in thousands)
ASSETS
Interest-earning assets
Loans (2)
Taxable	$	3,432,506	$	194,859	5.68	%	$	3,293,213	$	182,549	5.54	%
Tax-exempt		128,439		6,818	5.31	%		106,693		4,895	4.59	%
Securities
Taxable (available for sale)		159,275		6,913	4.34	%		123,616		4,862	3.93	%
Tax-exempt (available for sale)		30,855		1,115	3.61	%		32,888		1,139	3.46	%
Taxable (held to maturity)		106,783		4,282	4.01	%		108,037		4,283	3.96	%
Tax-exempt (held to maturity)		2,404		66	2.75	%		3,217		85	2.64	%
Cash and due from banks		146,719		6,526	4.45	%		28,435		1,945	6.84	%
Total interest-earning assets		4,006,981		220,579	5.50	%		3,696,099		199,758	5.40	%
Non interest-earning assets		444,194						442,843
Allowance for credit losses - loans		(44,063)						(44,400)
Total assets	$	4,407,112					$	4,094,542
LIABILITIES AND SHAREHOLDERS’ EQUITY
Interest-bearing deposits
Checking accounts	$	453,918	$	11,443	2.52	%	$	400,135	$	11,825	2.96	%
Savings accounts		838,709		12,211	1.46	%		814,980		12,218	1.50	%
Money market accounts		667,685		16,142	2.42	%		595,018		14,193	2.39	%
Certificates of deposit		635,509		24,362	3.83	%		605,071		25,273	4.18	%
Brokered deposits		20,097		814	4.05	%		748		17	2.27	%
Total interest-bearing deposits		2,615,918		64,972	2.48	%		2,415,952		63,526	2.63	%
Other borrowed funds		146,626		6,713	4.58	%		50,774		2,195	4.32	%
Total interest-bearing liabilities		2,762,544		71,685	2.59	%		2,466,726		65,721	2.66	%
Non-interest bearing liabilities
Demand deposits		980,837						985,876
Other liabilities		39,870						31,122
Total liabilities		3,783,251						3,483,724
Shareholders’ equity		623,861						610,818
Total liabilities & shareholders’ equity	$	4,407,112					$	4,094,542
Net interest income on a fully taxable equivalent basis				148,894						134,037
Less taxable equivalent adjustment				(1,680)						(1,285)
Net interest income			$	147,214					$	132,752
Net interest spread (3)					2.91	%					2.74	%
Net interest margin (4)					3.72	%					3.63	%

(1). Annualized on a fully taxable equivalent basis calculated using a federal tax rate of 21% for the six months ended June 30, 2025 and 2024.

(2). Nonaccrual loans are included in average amounts outstanding.

(3). Interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted average cost of interest-bearing liabilities.

(4). Net interest margin represents net interest income on a fully tax equivalent basis as a percentage of average interest-earning assets.

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	Six Months Ended
	June 30, 2025						June 30, 2024
			Interest		Rate				Interest		Rate
	Average		Income/		Earned/		Average		Income/		Earned/
	Balance		Expenses (1)		Paid (1)		Balance		Expenses (1)		Paid (1)
	(dollars in thousands)
ASSETS
Interest-earning assets
Loans (2)
Taxable	$	3,421,445	$	194,542	5.69	%	$	3,270,089	$	179,602	5.49	%
Tax-exempt		130,077		6,852	5.27	%		107,437		4,873	4.54	%