FB Financial Corporation

11/02/2026 | Press release | Distributed by Public on 11/02/2026 14:06

Quarterly Report for Quarter Ending September 30, 2026 (Form 10-Q)

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following is a discussion of our financial condition as of September 30, 2026 and December 31, 2025, and our results of operations for the three and nine months ended September 30, 2026 and 2025, and should be read in conjunction with our audited consolidated financial statements set forth in our Annual Report on Form 10-K for the year ended December 31, 2025, that was filed with the SEC on February 26, 2026, and with the accompanying unaudited notes to the condensed consolidated financial statements set forth in this Report.
Forward-Looking Statements
Certain statements contained in this Report that are not historical in nature may be considered forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements represent the Company's current expectations, plans or forecasts of its or its business segments' future results, which may include, among other measures, revenue, liquidity, net interest income, other income, provision for credit losses, expenses, operating leverage, effective tax rate, efficiency ratio, capital measures, deposits and assets, as well as strategy, future business and economic conditions more generally, and other future matters. These statements 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," and other variations of such words and phrases and similar expressions. These forward-looking statements are not historical facts, and are based upon management's current expectations, estimates, and projections, 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 shareholders and 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. 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 statements including, without limitation, (1) current and future economic conditions, including the effects of inflation, interest rate fluctuations, changes in the economy or global supply chain, supply-demand imbalances affecting local real estate prices, and high unemployment rates in the local or regional economies in which the Company operates and/or the U.S. economy generally, (2) changes or the lack of changes in government interest rate policies and the associated impact on the Company's business, net interest margin, funding costs, and mortgage operations, (3) increased competition for loans and deposits and the Company's ability to sustain loan and deposit growth, (4) changes in the quality or composition of the Company's loan or investment portfolios, including adverse developments in borrower industries or in the repayment ability of individual borrowers or issuers of investment securities, the impact of interest rates on the value of the Company's investment securities portfolio, or the adequacy of the Company's allowance for credit losses, (5) any deterioration in commercial real estate market fundamentals, (6) the Company's ability to identify potential candidates for, consummate, and achieve synergies from acquisitions, including risks that cost savings and other synergies from completed or future acquisitions may not be realized (or may be less than or delayed from expectations), challenges in integrating acquired businesses, disruptions to customer, employee, or other relationships, diversion of management attention, and the ability to effectively manage larger or more complex operations post-transaction, (7) the Company's ability to manage any unexpected outflows of uninsured deposits and to avoid selling investment securities or other assets at an unfavorable time or at a loss, (8) the Company's ability to successfully execute its various business strategies, including its investments in talent and growth initiatives and the effect of those investments on expenses and operating leverage, (9) changes in state and federal legislation, regulations or policies applicable to banks and other financial service providers, and changes in accounting standards, (10) the effectiveness of the Company's controls and procedures to detect, prevent, mitigate and otherwise manage the risk of fraud or misconduct by internal or external parties, including attempted physical-security and cybersecurity attacks, denial-of-service attacks, hacking, phishing, social-engineering attacks, malware intrusion, data-corruption attempts, system breaches, identity theft, ransomware attacks, environmental conditions, and intentional acts of destruction, (11) the Company's dependence on information technology systems of third-party service providers and the risk of systems failures, interruptions, or breaches of security, (12) the impact, extent and timing of technological changes, including the adoption and use of artificial intelligence and other emerging technologies, (13) concentrations of credit or deposit exposure, (14) the impact of natural disasters, pandemics, acts or escalation of war or acts of terrorism, or other catastrophic events, (15) events giving rise to international or regional political instability, including the broader impacts of such events on financial markets and/or global macroeconomic environments, (16) the Company's ability to attract and retain key employees in a competitive labor market, (17) the Company's ability to access capital and liquidity on terms acceptable to the Company, to effectively
deploy capital, including the proceeds of its recent subordinated debt issuance, and the amount and timing of any future share repurchases, (18) changes to the Company's preliminary regulatory capital ratios as they are finalized, and/or (19) general competitive, economic, political, and market conditions. Further information regarding the Company and factors which could affect the forward-looking statements contained herein can be found in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2025, and in any of the Company's subsequent filings with the SEC. 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 underlying assumptions prove to be incorrect, actual results may differ materially from the forward-looking statements. Accordingly, shareholders and investors should not place undue reliance on any such forward-looking statements. Any forward-looking statement speaks only as of the date of this Report, and the Company undertakes no 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.
The Company qualifies all forward-looking statements by these cautionary statements.
Critical accounting policies
Our financial statements are prepared in accordance with GAAP and general practices within the banking industry. Within our financial statements, certain financial information contains approximate measurements of financial effects of transactions and impacts at the consolidated balance sheet dates and our results of operations for the reporting periods. We monitor the status of proposed and newly issued accounting standards to evaluate the impact on our financial condition and results of operations. Our accounting policies, including the impact of any newly issued accounting standards if applicable, are discussed in further detail in Note 1, "Basis of presentation and summary of significant accounting policies," in the notes to our consolidated financial statements in our Annual Report on Form 10-K for the year ended December 31, 2025.
Financial highlights
The following table presents certain selected historical consolidated statements of income and balance sheets data and key performance indicators and other measures as of the dates or for the periods indicated. Our historical results for any prior period are not necessarily indicative of results to be expected in any future period.
As of or for the three months ended
As of or for the nine months ended
As of or for the year ended
September 30, September 30, December 31,
(dollars in thousands, except share data) 2026 2025 2026 2025 2025
Selected Balance Sheet Data
Cash and cash equivalents $ 1,017,689 $ 1,280,033 $ 1,017,689 $ 1,280,033 $ 1,155,895
Investment securities, at fair value 1,543,889 1,428,401 1,543,889 1,428,401 1,459,734
Loans held for sale 255,069 167,449 255,069 167,449 201,076
Loans HFI 13,179,564 12,297,600 13,179,564 12,297,600 12,383,626
Allowance for credit losses on loans HFI (193,960) (184,993) (193,960) (184,993) (185,983)
Total assets 17,093,991 16,236,459 17,093,991 16,236,459 16,300,292
Interest-bearing deposits (non-brokered) 11,262,198 10,634,555 11,262,198 10,634,555 10,649,932
Brokered deposits 626,687 487,765 626,687 487,765 625,634
Noninterest-bearing deposits 2,777,111 2,690,635 2,777,111 2,690,635 2,634,395
Total deposits 14,665,996 13,812,955 14,665,996 13,812,955 13,909,961
Borrowings 265,390 213,638 265,390 213,638 212,764
Allowance for credit losses on unfunded
commitments 		16,116 17,392 16,116 17,392 16,196
Total common shareholders' equity 1,933,646 1,978,043 1,933,646 1,978,043 1,948,165
Selected Statement of Income Data
Total interest income $ 236,107 $ 236,898 $ 690,895 $ 598,688 $ 833,926
Total interest expense 86,161 89,658 246,012 232,392 317,826
Net interest income 149,946 147,240 444,883 366,296 516,100
Provisions for credit losses 1,424 34,417 14,564 42,046 43,278
Total noninterest income 24,540 26,635 76,695 15,115 43,910
Total noninterest expense 96,034 109,856 282,678 270,666 378,214
Income before income taxes 77,028 29,602 224,336 68,699 138,518
Income tax expense 16,826 6,227 47,951 3,046 15,880
Net income attributable to noncontrolling
interest 		- - 8 8 16
Net income attributable to FB Financial
Corporation 		$ 60,202 $ 23,375 $ 176,377 $ 65,645 $ 122,622
Net interest income (tax-equivalent basis) $ 150,807 $ 148,088 $ 447,369 $ 368,751 $ 519,393
Per Common Share
Basic net income $ 1.21 $ 0.44 $ 3.46 $ 1.35 $ 2.47
Diluted net income 1.20 0.43 3.43 1.34 2.45
Book value 39.11 37.00 39.11 37.00 37.64
Tangible book value(1)
31.50 29.83 31.50 29.83 30.27
Cash dividends declared 0.21 0.19 0.63 0.57 0.76
Selected Ratios
Return on average:
Assets 1.43 % 0.58 % 1.43 % 0.62 % 0.84 %
Common shareholders' equity 12.2 % 4.69 % 12.0 % 5.11 % 6.90 %
Tangible common equity(1)
15.2 % 5.82 % 14.8 % 6.17 % 8.40 %
Efficiency ratio 55.0 % 63.2 % 54.2 % 71.0 % 67.5 %
Adjusted efficiency ratio (tax-equivalent
basis)(1)
54.3 % 53.3 % 53.5 % 56.4 % 56.4 %
Loans HFI to deposit ratio 89.9 % 89.0 % 89.9 % 89.0 % 89.0 %
Noninterest-bearing deposits to total deposits 18.9 % 19.5 % 18.9 % 19.5 % 18.9 %
Net interest margin (tax-equivalent basis) 3.83 % 3.95 % 3.90 % 3.74 % 3.81 %
Yield on interest-earning assets 6.02 % 6.35 % 6.05 % 6.10 % 6.14 %
Cost of interest-bearing liabilities 2.91 % 3.21 % 2.86 % 3.17 % 3.13 %
Cost of total deposits 2.32 % 2.53 % 2.28 % 2.52 % 2.49 %
As of or for the three months ended As of or for the nine months ended As of or for the year ended
September 30, September 30, December 31,
2026 2025 2026 2025 2025
Credit Quality Ratios
Allowance for credit losses on loans HFI as a
percentage of loans HFI 		1.47 % 1.50 % 1.47 % 1.50 % 1.50 %
Annualized net charge-offs as a percentage
of average loans HFI 		(0.04) % (0.05) % (0.07) % (0.07) % (0.06) %
Nonperforming loans HFI as a percentage of
loans HFI 		1.18 % 0.94 % 1.18 % 0.94 % 0.97 %
Nonperforming assets as a percentage of
total assets(2)
1.13 % 0.89 % 1.13 % 0.89 % 0.97 %
Capital Ratios (Company)
Total common shareholders' equity to assets 11.3 % 12.2 % 11.3 % 12.2 % 12.0 %
Tangible common equity to tangible assets(1)
9.32 % 10.1 % 9.32 % 10.1 % 9.84 %
Tier 1 leverage 10.0 % 10.6 % 10.0 % 10.6 % 10.3 %
Tier 1 risk-based capital 11.0 % 11.7 % 11.0 % 11.7 % 11.4 %
Total risk-based capital 13.6 % 13.6 % 13.6 % 13.6 % 13.2 %
Common Equity Tier 1 11.0 % 11.7 % 11.0 % 11.7 % 11.4 %
(1)Non-GAAP financial measure; See "GAAP reconciliation and management explanation of non-GAAP financial measures" and non-GAAP reconciliations herein.
(2)Includes $29.1 million, $21.7 million, and $28.1 million of optional rights to repurchase delinquent GNMA loans as of September 30, 2026, September 30, 2025 and December 31, 2025, respectively.
GAAP reconciliation and management explanation of non-GAAP financial measures
We identify certain financial measures discussed in this Report as being "non-GAAP financial measures." The non-GAAP financial measures presented in this Report are adjusted efficiency ratio (tax-equivalent basis), tangible book value per common share, tangible common equity to tangible assets and return on average tangible common equity.
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 consolidated statements of income, balance sheets or statements of cash flows. Management believes these non-GAAP financial measures provide useful supplemental information to investors regarding our financial condition and results of operations; however, they have limitations as analytical tools. 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 this Report may differ from that of other companies reporting measures with similar names which may limit their comparability. 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 discussed in this Report when comparing such non-GAAP financial measures. The following reconciliation tables provide a more detailed analysis of, and reconciliation for, each of the non-GAAP financial measures to the most directly comparable GAAP measures.
Adjusted efficiency ratio (tax-equivalent basis)
The adjusted efficiency ratio (tax-equivalent basis) is a non-GAAP measure that excludes certain gains, losses and other selected items. Our management uses this measure in its analysis of our performance. Our management believes this measure provides a greater understanding of ongoing operations and enhances comparability of results with prior periods, as well as demonstrates the effects of significant gains and charges. The most directly comparable financial measure calculated in accordance with GAAP is the efficiency ratio.
The following table presents a reconciliation of our adjusted efficiency ratio (tax-equivalent basis) to our efficiency ratio for the periods below:
(dollars in thousands) Three Months Ended September 30, Nine Months Ended September 30, Year Ended December 31,
2026 2025 2026 2025 2025
Adjusted efficiency ratio (tax-equivalent
basis)
Total noninterest expense $ 96,034 $ 109,856 $ 282,678 $ 270,666 $ 378,214
Less early retirement and severance costs - - - - 1,395
Less loan subservicer transition costs 719 - 719 - -
Less loss (gain) on lease terminations and
other branch closure costs 		- 270 (37) 270 282
Less charitable contribution to FirstBank
Foundation 		- - - - 1,130
Less merger and integration costs - 16,057 1,447 19,192 23,803
Adjusted noninterest expense $ 95,315 $ 93,529 $ 280,549 $ 251,204 $ 351,604
Net interest income $ 149,946 $ 147,240 $ 444,883 $ 366,296 $ 516,100
Net interest income (tax-equivalent basis) 150,807 148,088 447,369 368,751 519,393
Total noninterest income 24,540 26,635 76,695 15,115 43,910
Less (loss) gain from securities, net (241) 12 (240) (60,521) (60,457)
Less loss on sales or write-downs of
premises and equipment, other real estate
owned and other assets 		(34) (646) (731) (1,035) (1,166)
Less cash life insurance benefit - - 763 - 1,148
Adjusted noninterest income $ 24,815 $ 27,269 $ 76,903 $ 76,671 $ 104,385
Total revenue $ 174,486 $ 173,875 $ 521,578 $ 381,411 $ 560,010
Adjusted revenue (tax-equivalent basis) $ 175,622 $ 175,357 $ 524,272 $ 445,422 $ 623,778
Efficiency ratio 55.0 % 63.2 % 54.2 % 71.0 % 67.5 %
Adjusted efficiency ratio (tax-equivalent
basis) 		54.3 % 53.3 % 53.5 % 56.4 % 56.4 %
Tangible book value per common share and tangible common equity to tangible assets
Tangible book value per common share and tangible common equity to tangible assets are non-GAAP measures that exclude the impact of goodwill and other intangibles used by 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 our capital position to other companies. The most directly comparable financial measures calculated in accordance with GAAP are book value per common share and total common shareholders' equity to total assets.
The following table presents, as of the dates set forth below, tangible common equity compared with total common shareholders' equity, tangible book value per common share compared with our book value per common share and tangible common equity to tangible assets compared to total common shareholders' equity to total assets:
September 30,
December 31,
(dollars in thousands, except share data) 2026 2025 2025
Tangible assets
Total assets $ 17,093,991 $ 16,236,459 $ 16,300,292
Adjustments:
Goodwill (350,353) (350,353) (350,353)
Intangibles, net (25,870) (33,216) (31,284)
Tangible assets $ 16,717,768 $ 15,852,890 $ 15,918,655
Tangible common equity
Total common shareholders' equity $ 1,933,646 $ 1,978,043 $ 1,948,165
Adjustments:
Goodwill (350,353) (350,353) (350,353)
Intangibles, net (25,870) (33,216) (31,284)
Tangible common equity $ 1,557,423 $ 1,594,474 $ 1,566,528
Common shares outstanding 49,443,360 53,456,522 51,752,401
Book value per common share $ 39.11 $ 37.00 $ 37.64
Tangible book value per common share $ 31.50 $ 29.83 $ 30.27
Total common shareholders' equity to total assets 11.3 % 12.2 % 12.0 %
Tangible common equity to tangible assets 9.32 % 10.1 % 9.84 %
Return on average tangible common equity
Return on average tangible common equity is a non-GAAP measure that uses average shareholders' equity and excludes the impact of goodwill and other intangibles. This measurement is used by management to provide a depiction of our profitability without being impacted by intangible assets, as intangible assets are not directly managed to generate earnings. The most directly comparable financial measure calculated in accordance with GAAP is return on average common shareholders' equity.
The following table presents, for the periods set forth below, reconciliations of total average tangible common equity to average shareholders' equity and return on average tangible common equity to return on average shareholders' equity:
Three Months Ended September 30, Nine Months Ended September 30, Year Ended December 31,
(dollars in thousands) 2026 2025 2026 2025 2025
Return on average tangible common equity
Total average common shareholders' equity $ 1,951,116 $ 1,977,785 $ 1,968,010 $ 1,716,391 $ 1,776,945
Adjustments:
Average goodwill (350,353) (350,355) (350,353) (278,887) (296,901)
Average intangibles, net (26,782) (34,983) (28,589) (15,175) (19,492)
Average tangible common equity $ 1,573,981 $ 1,592,447 $ 1,589,068 $ 1,422,329 $ 1,460,552
Net income attributable to FB Financial
Corporation 		$ 60,202 $ 23,375 $ 176,377 $ 65,645 $ 122,622
Return on average common shareholders'
equity 		12.2 % 4.69 % 12.0 % 5.11 % 6.90 %
Return on average tangible common equity 15.2 % 5.82 % 14.8 % 6.17 % 8.40 %
Company overview
We are a financial holding company headquartered in Nashville, Tennessee. We operate primarily through our wholly-owned subsidiary bank, FirstBank, and its subsidiaries. FirstBank provides a comprehensive suite of commercial and consumer banking services to clients in select markets in Tennessee, Alabama, Kentucky, North Carolina and Georgia. As of September 30, 2026, our footprint included 90 full-service branches serving markets across Tennessee, including Nashville, Chattanooga, Knoxville, Memphis, and Jackson in addition to Bowling Green, Kentucky, Columbus and Newnan, Georgia and Birmingham, Anniston, Huntsville, and Auburn, Alabama. Subsequent to quarter-end, we opened our first full-service branch in Asheville, North Carolina in October 2026. Additionally, our banking services extend to community markets throughout our footprint. FirstBank also provides retail mortgage banking services utilizing its bank branch network and mortgage banking offices strategically located throughout the southeastern United States.
We operate through two segments, Banking and Mortgage. We generate the majority of our revenue in our Banking segment from interest on loans and investments, loan-related fees, trust and investment services and deposit-related fees. Our primary source of funding for our loans is customer deposits; however, we have other sources of funds including unsecured credit lines, brokered CDs, and other borrowings. We generate most of our revenue in our Mortgage segment from origination fees and gains on sales in the secondary mortgage loan market, as well as from mortgage servicing revenues.
Mergers and acquisitions
Southern States Bancshares, Inc.
On July 1, 2025, the Company completed its merger with Southern States Bancshares, Inc. and its wholly-owned subsidiary, Southern States Bank, with FB Financial Corporation continuing as the surviving entity. This merger strengthened the Company's presence in existing markets, such as Birmingham and Huntsville, Alabama, while expanding the Company's footprint further into Alabama and Georgia. The Company acquired total assets of $2.83 billion, total loans of $2.27 billion and assumed total deposits of $2.47 billion. Under the terms of the agreement, each outstanding share of Southern States common stock was converted into the right to receive 0.80 shares of the Company's stock. Additionally, fractional shares and outstanding stock options were settled in cash. As a result, total consideration paid was $368.4 million based on the Company's closing stock price of $45.30 per share on June 30, 2025. The merger resulted in additional goodwill of $107.8 million being recorded based on fair value estimates of total net assets acquired and liabilities assumed in the transaction.
Overview of recent financial performance
Results of operations
Three months ended September 30, 2026 compared to the three months ended September 30, 2025
We recognized net income of $60.2 million during the three months ended September 30, 2026 compared to $23.4 million for the three months ended September 30, 2025. Diluted earnings per common share were $1.20 and $0.43 for the three months ended September 30, 2026 and 2025, respectively. Our net income represented a ROAA of 1.43% and 0.58% for the three months ended September 30, 2026 and 2025, respectively, and a ROAE of 12.2% and 4.69% for the same periods. Our ROATCE for the three months ended September 30, 2026 and 2025 was 15.2% and 5.82%, respectively. See "GAAP reconciliation and management explanation of non-GAAP financial measures" in this Report for a discussion of tangible common equity and return on average tangible common equity.
Net interest income increased to $149.9 million for the three months ended September 30, 2026 compared with $147.2 million for the three months ended September 30, 2025. Our net interest margin, on a tax-equivalent basis, decreased to 3.83% for the three months ended September 30, 2026 as compared to 3.95% for the three months ended September 30, 2025. Net interest income increased as growth in average interest-earning assets and lower funding costs more than offset the impact of lower earning asset yields. Net interest margin decreased as the impact of lower earning asset yields more than offset the benefit of declining deposit and borrowing costs.
Provision for credit losses of $1.4 million was recognized for the three months ended September 30, 2026 compared with $34.4 million for the three months ended September 30, 2025. The decrease was primarily due to the initial provision for credit losses on acquired loans and unfunded commitments from the Southern States merger of $28.4 million during the three months ended September 30, 2025. Refer to Note 2, "Mergers and acquisitions" in this Report for further discussion around the merger with Southern States.
Noninterest income for the three months ended September 30, 2026 decreased by $2.1 million to $24.5 million, compared to $26.6 million for the three months ended September 30, 2025. The decrease was driven by a $4.1 million decrease in mortgage banking income due to lower mortgage origination and sale volumes, as well as a decrease in the net change in fair value of loans held for sale and related derivatives. The decline was partially offset by increases in investment services and trust income, other income, and service charges on deposit accounts, as well as lower losses on sales or write-downs of premises and equipment, other real estate owned and other assets.
Noninterest expense decreased to $96.0 million for the three months ended September 30, 2026, compared with $109.9 million for the three months ended September 30, 2025. The decrease in noninterest expense was primarily driven by $16.1 million of merger and integration costs related to the Southern States merger recognized during the three months ended September 30, 2025, as well as a $3.2 million decrease in salaries, commissions and employee benefits. The decrease was partially offset by a $4.2 million increase in other expense, reflecting a $1.0 million increase in subservicer fees, of which $0.7 million was associated with the transition to a new mortgage subservicer, and increases across several expense categories, such as franchise taxes, regulatory costs and software license and maintenance fees.
Income tax expense for the three months ended September 30, 2026 was $16.8 million compared to $6.2 million for the three months ended September 30, 2025. The increase was primarily attributable to the increase in income before income taxes.
Nine months ended September 30, 2026 compared to the nine months ended September 30, 2025
Our net income increased during the nine months ended September 30, 2026 to $176.4 million from $65.7 million for the nine months ended September 30, 2025. Diluted earnings per common share were $3.43 and $1.34 for the nine months ended September 30, 2026 and 2025, respectively. Our net income represented a ROAA of 1.43% and 0.62% for the nine months ended September 30, 2026 and 2025, respectively, and a ROAE of 12.0% and 5.11% for the same periods. Our ROATCE for the nine months ended September 30, 2026 and 2025 was 14.8% and 6.17%, respectively. See "GAAP reconciliation and management explanation of non-GAAP financial measures" in this Report for a discussion of tangible common equity and return on average tangible common equity.
During the nine months ended September 30, 2026, our net interest income increased to $444.9 million from $366.3 million for the nine months ended September 30, 2025. Our net interest margin, on a tax-equivalent basis, increased to 3.90% for the nine months ended September 30, 2026 as compared to 3.74% for the nine months ended September 30, 2025. The increase in net interest income and net interest margin, on a tax-equivalent basis, was driven by a $92.2 million increase in interest income, primarily from higher average loans HFI resulting from the Southern States merger and continued loan growth, partially offset by a $13.6 million increase in interest expense. The increase in net interest margin reflected a 31 basis point decline in the cost of interest-bearing liabilities, which outpaced the 5 basis point decline in the yield on interest-earning assets.
Provision for credit losses of $14.6 million was recognized for the nine months ended September 30, 2026 compared with $42.0 million for the nine months ended September 30, 2025, primarily due to the initial provision for credit losses on acquired loans and unfunded commitments from the Southern States merger of $28.4 million recognized during the nine months ended September 30, 2025.
Noninterest income for the nine months ended September 30, 2026 increased by $61.6 million to $76.7 million, compared to $15.1 million for the prior year period. The increase in noninterest income was primarily attributable to the $60.5 million net loss on investment securities recognized from the sale of $266.9 million of AFS debt securities during the nine months ended September 30, 2025. Refer to the section "Other earning assets" for additional information on the sale of the AFS debt securities.
Noninterest expense increased to $282.7 million for the nine months ended September 30, 2026, compared with $270.7 million for the nine months ended September 30, 2025. Salaries, commissions and employee benefits increased $12.5 million reflecting the addition of Southern States personnel and higher bonus and commissions, partially offset by higher deferred salary costs related to loan originations during the period and lower performance-based equity compensation. Other expense increased $12.0 million, primarily due to higher franchise tax expense, software license and maintenance fees, regulatory costs, card transaction fees, contributions and dues, subservicer fees and broad-based increases across several expense categories. The increase was partially offset by a $17.7 million decrease in merger and integration costs recognized related to the Southern States merger.
Income tax expense for the nine months ended September 30, 2026 was $48.0 million compared to $3.0 million for the nine months ended September 30, 2025. The increase primarily reflects higher income before income taxes in the current period, as the prior period included the income tax effect of a $60.5 million loss on sale of AFS debt securities and a one-time gross tax benefit of $10.7 million due to the expiration of the statute of limitations with respect to an amended income tax return and the associated interest for the nine months ended September 30, 2025.
Business segment highlights
We operate our business in two business segments: Banking and Mortgage. See Note 13, "Segment reporting" in the notes to our consolidated financial statements contained herein for a description of these business segments.
Banking
Three months ended September 30, 2026 compared to three months ended September 30, 2025
The Banking segment contributed $77.7 million of income before taxes for the current period as compared to $26.9 million for the previous period. Net interest income totaled $146.1 million during the three months ended September 30, 2026 compared to $144.9 million during the previous period. Provisions for credit losses on loans HFI and unfunded loan commitments resulted in $1.0 million of provision expense during the current period as compared to $34.1 million during the previous period. The decrease was primarily due to the initial provision for credit losses on acquired loans and unfunded commitments from the Southern States merger of $28.4 million recognized in the previous period. The Banking segment recorded noninterest income of $15.0 million in the current period as compared to $13.1 million in the previous period. Noninterest expense decreased to $82.5 million for the current period compared to $97.0 million for the previous period primarily due to the decrease in merger and integration costs associated with the Southern States merger and salaries, commissions and employee benefits, partially offset by an increase in other expense, including franchise tax expense and modest increases across several expense categories, such as regulatory costs and software license and maintenance fees.
Mortgage
Three months ended September 30, 2026 compared to three months ended September 30, 2025
Activity in our Mortgage segment resulted in a loss before income taxes of $0.7 million for the current period, as compared to income before income taxes of $2.7 million in the prior period. Net interest income was $3.8 million for the current period and $2.4 million for the prior period. Provisions for credit losses on loans HFI and unfunded loan commitments resulted in provision expense of $0.4 million during the current period compared to $0.3 million during the prior period. Mortgage banking income decreased $4.1 million to $9.4 million during the current period compared to $13.5 million in the prior period.
The components of mortgage banking income for the three months ended September 30, 2026 and 2025 were as follows:
Three Months Ended September 30,
(dollars in thousands) 2026 2025
Mortgage banking income
Gains and fees from origination and sale of mortgage
loans held for sale 		$ 8,168 $ 9,237
Net change in fair value of loans held for sale and derivatives (1,717) 801
Change in fair value on MSRs, net of hedging (3,478) (3,390)
Mortgage servicing income 6,452 6,836
Total mortgage banking income $ 9,425 $ 13,484
Interest rate lock commitment volume $ 330,303 $ 432,149
Interest rate lock commitment volume by purpose (%):
Purchase 86.3 % 79.2 %
Refinance 13.7 % 20.8 %
Mortgage sales $ 230,476 $ 343,450
Mortgage sale margin 3.54 % 2.69 %
Closing volume $ 299,392 $ 370,287
Outstanding principal balance of mortgage loans serviced $ 9,106,646 $ 9,716,824
Noninterest expense for the three months ended September 30, 2026 and 2025 was $13.5 million and $12.9 million, respectively.
Banking
Nine months ended September 30, 2026 compared to the nine months ended September 30, 2025
The Banking segment contributed $222.8 million of income before taxes for the current period as compared to $67.5 million for the previous period. Net interest income totaled $434.7 million during the nine months ended September 30, 2026 compared to $359.5 million during the previous period. Provisions for credit losses on loans HFI and unfunded loan commitments resulted in $12.1 million of provision expense during the current period as compared to $36.8 million during the previous period. Similar to above, the decrease was primarily due to the initial provision for credit losses on acquired loans and unfunded commitments from the Southern States merger of $28.4 million recognized in the previous period. The Banking segment recorded noninterest income of $43.4 million in the current period as compared to a loss of $24.0 million in the previous period. The increase was mainly attributable to a $60.5 million net loss on investment securities recognized in the previous period from the sale of $266.9 million of AFS debt securities. Noninterest expense increased to $243.2 million for the current period compared to $231.2 million for the previous period, primarily due to increases in salaries, commissions and employee benefits, amortization of core deposit intangibles and occupancy, reflecting in part the impact of the Southern States merger. The increase also reflected higher franchise tax expense, software license and maintenance fees and broad-based increases across several expense categories, including regulatory costs, card transaction fees, contributions and dues, and subservicer fees, partially offset by a $17.7 million decrease in merger and integration costs.
Mortgage
Nine months ended September 30, 2026 compared to the nine months ended September 30, 2025
Activity in our Mortgage segment resulted in income before income taxes of $1.6 million for the current period, as compared to $1.2 million in the prior period. Net interest income was $10.2 million for the current period and $6.8 million for the prior period. Provisions for credit losses on loans HFI and unfunded loan commitments resulted in provision expense of $2.5 million during the current period compared to $5.2 million of provision expense during the prior period. The decrease in the provision primarily reflects the impact of the change in the CECL loss estimation methodology, which notably impacted the Company's reserves on 100% financed 1-to-4 mortgages during the previous period. Mortgage banking income decreased $6.1 million to $32.8 million during the current period compared to $38.9 million in the prior period.
The components of mortgage banking income for the nine months ended September 30, 2026 and 2025 were as follows:
Nine Months Ended September 30,
(dollars in thousands) 2026 2025
Mortgage banking income
Gains and fees from origination and sale of mortgage
loans held for sale 		$ 26,095 $ 26,039
Net change in fair value of loans held for sale and derivatives (1,730) 2,741
Change in fair value on MSRs, net of hedging (11,043) (10,690)
Mortgage servicing income 19,526 20,849
Total mortgage banking income $ 32,848 $ 38,939
Interest rate lock commitment volume $ 1,256,074 $ 1,270,646
Interest rate lock commitment volume by purpose (%):
Purchase 82.0 % 84.4 %
Refinance 18.0 % 15.6 %
Mortgage sales $ 903,005 $ 957,316
Mortgage sale margin 2.89 % 2.72 %
Closing volume $ 971,694 $ 1,012,802
Outstanding principal balance of mortgage loans serviced $ 9,106,646 $ 9,716,824
Noninterest expense for both the nine months ended September 30, 2026 and 2025 was $39.5 million.
Results of operations
Throughout the following discussion of our operating results, we present our net interest income, net interest margin and adjusted efficiency ratio on a fully tax-equivalent basis. The fully tax-equivalent basis adjusts for the tax-favored status of net interest income from certain qualifying loans and investments.
Our tax-exempt income is converted to a tax-equivalent basis by adjusting for the combined federal and blended state statutory income tax rate of 26.06% for the three and nine months ended September 30, 2026 and 2025.
Net interest income
Net interest income is the primary component of our earnings and represents the difference, or spread, between interest and fee income generated from earning assets and the interest expense paid on deposits and borrowed funds. Net interest income and margin are shaped by fluctuations in interest rates as well as changes in volume and mix of earning assets and interest-bearing liabilities.
During the three months ended September 30, 2026, yields increased across the U.S. Treasury curve, steepening modestly as longer-term interest rates increased more than short-term rates amid persistent inflation and higher energy prices. During the nine months ended September 30, 2026, yields increased significantly across the curve, led by maturities of two to five years, which rose more than both the ten-year and thirty-year maturities, as market expectations shifted from additional rate cuts to rate increases by the Federal Reserve, resulting in a flatter curve between the two-year and ten-year maturities. In contrast, during the three and nine months ended September 30, 2025, yields on the U.S. Treasury curve declined but generally maintained the same overall shape as market expectations increased for additional rate cuts by the Federal Reserve. The Federal Funds Target Rate range was 3.75% - 4.00% and 4.00% - 4.25% as of September 30, 2026 and September 30, 2025, respectively. In September 2026, the Federal Reserve raised the target range by 25 basis points, its first increase since 2023.
Three months ended September 30, 2026 compared to three months ended September 30, 2025
Net interest income increased to $150.8 million for the three months ended September 30, 2026 as compared to $148.1 million for the three months ended September 30, 2025. Net interest margin was 3.83% for the three months ended September 30, 2026 compared to 3.95% for the three months ended September 30, 2025. Net interest income increased as growth in average interest-earning assets and lower funding costs more than offset the impact of lower earning asset yields. Net interest margin declined as the yield on interest-earning assets decreased 33 basis points to 6.02%, outpacing the 30 basis point decrease in the cost of interest-bearing liabilities to 2.91%.
Interest income was $237.0 million for the three months ended September 30, 2026, compared to $237.7 million for the three months ended September 30, 2025, a decrease of $0.8 million, which was primarily driven by lower yields on interest-earning assets reflecting lower interest rates compared to the prior period, partially offset by growth in average interest-earning assets, most notably loans HFI.
Interest income on loans HFI increased $2.6 million to $210.0 million for the three months ended September 30, 2026 from $207.4 million for the three months ended September 30, 2025 due to growth in average loan balances. The yield on loans HFI was 6.42% for the three months ended September 30, 2026, down 33 basis points from the three months ended September 30, 2025, reflecting a 24 basis point decline in the contractual rate and a 10 basis point decline in accretion on purchased loans.
The components of our loan yield for the three months ended September 30, 2026 and 2025 were as follows:
Three Months Ended September 30,
2026 2025
(dollars in thousands) Interest
income 		Average
yield 		Interest
income 		Average
yield
Loans HFI yield components:
Contractual interest rate on loans HFI(1)
$ 203,083 6.21 % $ 198,320 6.45 %
Origination and other loan fee income 2,397 0.07 % 1,575 0.05 %
Accretion on purchased loans 4,314 0.13 % 7,025 0.23 %
Nonaccrual interest collections 181 0.01 % 503 0.02 %
Total loans HFI yield $ 209,975 6.42 % $ 207,423 6.75 %
(1) Includes tax-equivalent adjustment using combined federal and blended state statutory tax rate of 26.06%.
Accretion on purchased loans contributed 11 and 19 basis points to the NIM for the three months ended September 30, 2026 and 2025, respectively, as a result of the Southern States merger.
Interest expense was $86.2 million for the three months ended September 30, 2026, a decrease of $3.5 million as compared to the three months ended September 30, 2025, driven by a decrease in the rate paid on interest-bearing liabilities to 2.91% from 3.21%, partially offset by an increase in the average balance of interest-bearing liabilities. These changes were primarily attributable to lower interest rates compared to the prior year and management's continued focus on managing funding costs.
Interest expense on interest-bearing deposit accounts totaled $84.4 million for the three months ended September 30, 2026, a $2.2 million decrease from the $86.6 million recognized for the three months ended September 30, 2025. The decrease in interest expense was largely due to lower rates paid on most interest-bearing deposit categories, most notably money market deposits, reflecting lower interest rates and management's focus on managing deposit costs. Higher average balances in customer time deposits, interest-bearing checking, savings and brokered and internet time deposit accounts, as well as a higher rate paid on savings deposits, partially offset the benefit of lower deposit pricing. Total cost of interest-bearing deposits was 2.88% for the three months ended September 30, 2026 compared to 3.16% for the three months ended September 30, 2025.
Interest expense on subordinated debt totaled $1.7 million for the three months ended September 30, 2026, compared to $2.9 million for the three months ended September 30, 2025. The decrease was primarily attributable to lower average subordinated debt balances following the redemption of $130.9 million of subordinated notes and junior subordinated debentures in September 2025, partially offset by higher average rate paid on subordinated debt.
Average balance and interest yield/rate analysis
The table below shows the average balances, income and expense and yield and rates of each of our interest-earning assets and interest-bearing liabilities on a tax-equivalent basis, if applicable, for the periods indicated.
Three Months Ended September 30,
2026 2025
(dollars in thousands) Average
balances 		Interest
income/
expense 		Average
yield/
rate 		Average
balances 		Interest
income/
expense 		Average
yield/
rate
Interest-earning assets:
Loans HFI (1)(2)
$ 12,977,638 $ 209,975 6.42 % $ 12,189,401 $ 207,423 6.75 %
Mortgage loans held for sale 180,736 2,818 6.19 % 162,205 2,359 5.77 %
Investment securities:
Taxable 1,448,672 14,289 3.91 % 1,304,894 14,395 4.38 %
Tax-exempt(2)
168,393 1,443 3.40 % 169,523 1,431 3.35 %
Total investment securities(2)
1,617,065 15,732 3.86 % 1,474,417 15,826 4.26 %
Federal funds sold and reverse repurchase agreements
189,911 1,869 3.90 % 331,029 3,966 4.75 %
Interest-bearing deposits with other financial institutions 578,439 5,403 3.71 % 671,634 7,340 4.34 %
Restricted equity securities, at cost 84,193 1,171 5.52 % 36,907 832 8.94 %
Total interest-earning assets(2)
15,627,982 236,968 6.02 % 14,865,593 237,746 6.35 %
Noninterest-earning assets:
Cash and due from banks 137,957 139,226
Allowance for credit losses on loans HFI (194,674) (181,973)
Other assets (3)(4)
1,164,512 1,184,942
Total noninterest-earning assets 1,107,795 1,142,195
Total assets $ 16,735,777 $ 16,007,788
Interest-bearing liabilities:
Interest-bearing deposits:
Interest-bearing checking $ 2,513,622 $ 11,834 1.87 % $ 2,331,589 $ 12,383 2.11 %
Money market deposits 5,579,134 43,295 3.08 % 5,561,538 49,019 3.50 %
Savings deposits 524,702 1,446 1.09 % 406,787 248 0.24 %
Customer time deposits 2,371,348 21,443 3.59 % 1,997,905 18,965 3.77 %
Brokered and internet time deposits 630,325 6,388 4.02 % 560,127 5,962 4.22 %
Time deposits 3,001,673 27,831 3.68 % 2,558,032 24,927 3.87 %
Total interest-bearing deposits 11,619,131 84,406 2.88 % 10,857,946 86,577 3.16 %
Other interest-bearing liabilities:
Securities sold under agreements to repurchase and federal funds
purchased 		9,481 20 0.84 % 13,144 31 0.94 %
Federal Home Loan Bank advances 5,163 65 4.99 % 15,217 172 4.48 %
Subordinated debt 93,866 1,664 7.03 % 180,805 2,872 6.30 %
Other borrowings 1,066 6 2.23 % 1,168 6 2.04 %
Total other interest-bearing liabilities 109,576 1,755 6.35 % 210,334 3,081 5.81 %
Total interest-bearing liabilities 11,728,707 86,161 2.91 % 11,068,280 89,658 3.21 %
Noninterest-bearing liabilities:
Demand deposits 2,798,442 2,724,898
Other liabilities(4)
257,419 236,732
Total noninterest-bearing liabilities 3,055,861 2,961,630
Total liabilities 14,784,568 14,029,910
FB Financial Corporation common shareholders' equity 1,951,116 1,977,785
Noncontrolling interest 93 93
Shareholders' equity 1,951,209 1,977,878
Total liabilities and shareholders' equity $ 16,735,777 $ 16,007,788
Net interest income (tax-equivalent basis)(2)
$ 150,807 $ 148,088
Interest rate spread (tax-equivalent basis)(2)
3.11 % 3.14 %
Net interest margin (tax-equivalent basis)(2)(5)
3.83 % 3.95 %
Cost of total deposits 2.32 % 2.53 %
Average interest-earning assets to average interest-bearing liabilities 133.2 % 134.3 %
(1) Average loans are presented gross, including nonaccrual loans and overdrafts (before deduction of allowance for credit losses on loans HFI).
(2) Interest income includes the effects of taxable-equivalent adjustments using the combined federal and blended state statutory income tax rate to increase tax-exempt interest income to a tax-
equivalent basis. The net taxable-equivalent adjustment amounts included were $0.9 million and $0.8 million for the three months ended September 30, 2026 and 2025, respectively.
(3) Includes average net unrealized losses on investment securities available for sale of $59.6 million and $64.8 million for the three months ended September 30, 2026 and 2025, respectively.
(4) Includes average of optional rights to repurchase government guaranteed GNMA mortgage loans previously sold that meet certain defined delinquency criteria of $31.0 million and $21.6 million
for the three months ended September 30, 2026 and 2025, respectively.
(5) The NIM is calculated by dividing annualized net interest income, on a tax-equivalent basis, by average total interest-earning assets.
Yield/rate and volume analysis
The table below presents the components of the changes in net interest income for the three months ended September 30, 2026 and 2025. For each major category of interest-earning assets and interest-bearing liabilities, information is provided with respect to changes due to average volume and changes due to interest rates, with the changes in both volume and interest rates allocated to these two categories based on the proportionate absolute changes in each category.
Three months ended September 30, 2026 compared to three months ended September 30, 2025 due to changes in
(dollars in thousands) Volume Yield/rate Net increase
(decrease)
Interest-earning assets:
Loans HFI(1)(2)
$ 12,753 $ (10,201) $ 2,552
Loans held for sale - mortgage 289 170 459
Investment securities:
Taxable 1,418 (1,524) (106)
Tax-exempt(2)
(10) 22 12
Federal funds sold and reverse repurchase agreements
(1,389) (708) (2,097)
Interest-bearing deposits with other financial institutions (871) (1,066) (1,937)
Restricted equity securities, at cost 658 (319) 339
Total interest income(2)
12,848 (13,626) (778)
Interest-bearing liabilities:
Interest-bearing checking deposits 857 (1,406) (549)
Money market deposits 137 (5,861) (5,724)
Savings deposits 325 873 1,198
Customer time deposits 3,377 (899) 2,478
Brokered and internet time deposits 711 (285) 426
Securities sold under agreements to repurchase and federal funds
purchased 		(8) (3) (11)
Federal Home Loan Bank advances (127) 20 (107)
Subordinated debt (1,541) 333 (1,208)
Other borrowings (1) 1 -
Total interest expense 3,730 (7,227) (3,497)
Change in net interest income(2)
$ 9,118 $ (6,399) $ 2,719
(1) Average loans are presented gross, including nonaccrual loans and overdrafts (before deduction of allowance for credit losses on loans HFI).
(2) Interest income includes the effects of the tax-equivalent adjustments to increase tax-exempt interest income to a tax-equivalent basis. The net taxable-equivalent
adjustment amounts included were $0.9 million and $0.8 million for the three months ended September 30, 2026 and 2025, respectively.
Nine months ended September 30, 2026 compared to the nine months ended September 30, 2025
Net interest income increased $78.6 million to $447.4 million for the nine months ended September 30, 2026 as compared to $368.8 million for the nine months ended September 30, 2025. Net interest margin was 3.90% for the nine months ended September 30, 2026 compared to 3.74% for the nine months ended September 30, 2025. Net interest income reflected growth in average earning assets, most notably loans HFI, resulting from the Southern States merger and continued loan growth, while the increase in net interest margin was primarily driven by lower funding costs, including a decline in the average cost of interest-bearing deposits, partially offset by lower yields on earning assets.
Interest income was $693.4 million for the nine months ended September 30, 2026, compared to $601.1 million for the nine months ended September 30, 2025, an increase of $92.2 million. The increase in interest income was primarily attributable to loans HFI, which increased $95.3 million to $612.9 million for the nine months ended September 30, 2026 from $517.6 million for the nine months ended September 30, 2025. The increase was driven by higher average balances of loans HFI, reflecting the Southern States merger and continued loan growth. The yield on loans HFI decreased 8 basis points to 6.47% for the nine months ended September 30, 2026 from 6.55% for the nine months ended September 30, 2025, as lower market interest rates were partially offset by accretion income on purchased loans.
The components of our loan yield for the nine months ended September 30, 2026 and 2025 were as follows:
Nine Months Ended September 30,
2026 2025
(dollars in thousands) Interest
income 		Average
yield 		Interest
income 		Average
yield
Loans HFI yield components:
Contractual interest rate on loans HFI(1)
$ 588,960 6.21 % $ 503,836 6.37 %
Origination and other loan fee income 7,134 0.08 % 5,317 0.07 %
Accretion on purchased loans 15,660 0.17 % 6,965 0.09 %
Nonaccrual interest collections 1,129 0.01 % 1,443 0.02 %
Total loans HFI yield $ 612,883 6.47 % $ 517,561 6.55 %
(1)Includes tax-equivalent adjustment using the combined federal and blended state statutory income tax rate of 26.06%.
Accretion on purchased loans contributed 14 and 7 basis points to the NIM for the nine months ended September 30, 2026 and 2025, respectively, as a result of the Southern States merger.
Interest expense was $246.0 million for the nine months ended September 30, 2026, an increase of $13.6 million as compared to $232.4 million for the nine months ended September 30, 2025. The increase was primarily attributable to higher average balances of interest-bearing deposits resulting from the Southern States merger and continued deposit growth, partially offset by lower rates paid on interest-bearing deposits and other interest-bearing liabilities.
Interest expense on interest-bearing deposit accounts totaled $241.1 million for the nine months ended September 30, 2026, an increase of $15.7 million from the prior year, largely due to higher average balances, particularly in money market deposits and customer time deposits, partially offset by lower rates paid on those deposits. The average rate paid on interest-bearing deposits was 2.83% for the nine months ended September 30, 2026 compared to 3.13% for the nine months ended September 30, 2025.
Interest expense on subordinated debt totaled $4.6 million for the nine months ended September 30, 2026, compared to $6.5 million for the nine months ended September 30, 2025. The decrease was primarily attributable to lower average subordinated debt balances following the redemption of $130.9 million of subordinated notes and junior subordinated debentures in September 2025. The decrease was partially offset by a higher average rate paid on subordinated debt.
Average balance and interest yield/rate analysis
The table below shows the average balances, income and expense and yield and rates of each of our interest-earning assets and interest-bearing liabilities on a tax-equivalent basis, if applicable, for the periods indicated.
Nine Months Ended September 30,
2026 2025
(dollars in thousands) Average balances Interest
income/
expense 		Average
yield/
rate 		Average balances Interest
income/
expense 		Average
yield/
rate
Interest-earning assets:
Loans HFI (1)(2)
$ 12,670,173 $ 612,883 6.47 % $ 10,559,871 $ 517,561 6.55 %
Mortgage loans held for sale 185,961 8,479 6.10 % 127,657 5,981 6.26 %
Investment securities:
Taxable 1,411,298 41,668 3.95 % 1,459,685 43,527 3.99 %
Tax-exempt (2)
168,730 4,310 3.42 % 168,390 4,229 3.36 %
Total investment securities (2)
1,580,028 45,978 3.89 % 1,628,075 47,756 3.92 %
Federal funds sold and reverse repurchase agreements 199,022 5,864 3.94 % 189,984 6,596 4.64 %
Interest-bearing deposits with other financial institutions 606,923 16,746 3.69 % 635,796 20,975 4.41 %
Restricted equity securities, at cost 81,865 3,431 5.60 % 35,024 2,274 8.68 %
Total interest-earning assets (2)
15,323,972 693,381 6.05 % 13,176,407 601,143 6.10 %
Noninterest-earning assets:
Cash and due from banks 142,077 126,093
Allowance for credit losses on loans HFI (190,096) (162,040)
Other assets (3)(4)
1,168,484 952,215
Total noninterest-earning assets 1,120,465 916,268
Total assets $ 16,444,437 $ 14,092,675
Interest-bearing liabilities:
Interest-bearing deposits:
Interest-bearing checking $ 2,556,088 $ 35,783 1.87 % $ 2,562,483 $ 46,520 2.43 %
Money market deposits 5,452,631 122,429 3.00 % 4,592,506 118,336 3.45 %
Savings deposits 487,951 3,137 0.86 % 371,180 412 0.15 %
Customer time deposits 2,266,458 61,053 3.60 % 1,594,062 44,121 3.70 %
Brokered and internet time deposits 620,316 18,650 4.02 % 495,671 16,005 4.32 %
Time deposits 2,886,774 79,703 3.69 % 2,089,733 60,126 3.85 %
Total interest-bearing deposits 11,383,444 241,052 2.83 % 9,615,902 225,394 3.13 %
Other interest-bearing liabilities:
Securities sold under agreements to repurchase and federal funds purchased 10,895 54 0.66 % 11,773 63 0.72 %
Federal Home Loan Bank advances 3,663 106 3.87 % 12,821 430 4.48 %
Subordinated debt 87,306 4,641 7.11 % 147,654 6,489 5.88 %
Other borrowings 6,220 159 3.42 % 1,560 16 1.37 %
Total other interest-bearing liabilities 108,084 4,960 6.14 % 173,808 6,998 5.38 %
Total interest-bearing liabilities 11,491,528 246,012 2.86 % 9,789,710 232,392 3.17 %
Noninterest-bearing liabilities:
Demand deposits 2,725,024 2,357,537
Other liabilities(4)
259,782 228,944
Total noninterest-bearing liabilities 2,984,806 2,586,481
Total liabilities 14,476,334 12,376,191
FB Financial Corporation common shareholders' equity 1,968,010 1,716,391
Noncontrolling interest 93 93
Shareholders' equity 1,968,103 1,716,484
Total liabilities and shareholders' equity $ 16,444,437 $ 14,092,675
Net interest income (tax-equivalent basis)(2)
$ 447,369 $ 368,751
Interest rate spread (tax-equivalent basis)(2)
3.19 % 2.93 %
Net interest margin (tax-equivalent basis) (2)(5)
3.90 % 3.74 %
Cost of total deposits 2.28 % 2.52 %
Average interest-earning assets to average interest-bearing liabilities 133.4 % 134.6 %
(1)Average loans are presented gross, including nonaccrual loans and overdrafts (before deduction of allowance for credit losses on loans HFI).
(2)Interest income includes the effects of taxable-equivalent adjustments using the combined federal and blended state statutory income tax rate to increase tax-exempt interest income to a tax-
equivalent basis. The net tax-equivalent adjustment amounts included in income were $2.5 million for both the nine months ended September 30, 2026 and 2025.
(3)Includes average net unrealized losses on investment securities available for sale of $51.4 million and $108.4 million for the nine months ended September 30, 2026 and 2025, respectively.
(4)Includes average of optional rights to repurchase government guaranteed GNMA mortgage loans previously sold that meet certain defined delinquency criteria of $32.0 million and $25.8 million for the nine months ended September 30, 2026 and 2025, respectively.
(5)The NIM is calculated by dividing annualized net interest income, on a tax-equivalent basis, by average total interest-earning assets.
Yield/rate and volume analysis
The table below presents the components of the changes in net interest income for the nine months ended September 30, 2026 and 2025. For each major category of interest-earning assets and interest-bearing liabilities, information is provided with respect to changes due to average volume and changes due to interest rates, with the changes in both volume and interest rates allocated to these two categories based on the proportionate absolute changes in each category.
Nine months ended September 30, 2026 compared to nine months ended September 30, 2025 due to changes in
(dollars in thousands) Volume Yield/rate Net increase
(decrease)
Interest-earning assets:
Loans HFI(1)(2)
$ 102,080 $ (6,758) $ 95,322
Loans held for sale - mortgage 2,658 (160) 2,498
Investment securities:
Taxable (1,429) (430) (1,859)
Tax-exempt(2)
9 72 81
Federal funds sold and reverse repurchase agreements
266 (998) (732)
Interest-bearing deposits with other financial institutions (797) (3,432) (4,229)
Restricted equity securities, at cost 1,963 (806) 1,157
Total interest income(2)
104,750 (12,512) 92,238
Interest-bearing liabilities:
Interest-bearing checking deposits (90) (10,647) (10,737)
Money market deposits 19,313 (15,220) 4,093
Savings deposits 751 1,974 2,725
Customer time deposits 18,113 (1,181) 16,932
Brokered and internet time deposits 3,747 (1,102) 2,645
Securities sold under agreements to repurchase and federal funds
purchased 		(4) (5) (9)
Federal Home Loan Bank advances (265) (59) (324)
Subordinated debt (3,208) 1,360 (1,848)
Other borrowings 119 24 143
Total interest expense 38,476 (24,856) 13,620
Change in net interest income(2)
$ 66,274 $ 12,344 $ 78,618
(1)Average loans are presented gross, including nonaccrual loans and overdrafts (before deduction of allowance for credit losses on loans HFI).
(2)Interest income includes the effects of the tax-equivalent adjustments to increase tax-exempt interest income to a tax-equivalent basis. The net taxable-equivalent adjustment amounts included were $2.5 million for both the nine months ended September 30, 2026 and 2025.
Provision for credit losses
The provision for credit losses charged to operating expense is an amount which, in the judgment of management, is necessary to maintain the allowance for credit losses at an appropriate level under the current expected credit loss model. The determination of the amount of the allowance is complex and involves a high degree of judgment and subjectivity.
Our allowance for credit losses calculation as of September 30, 2026 resulted from management's best estimate of losses over the life of loans and unfunded commitments in our portfolio in accordance with the CECL approach.
Beginning with June 30, 2025, we began to utilize the discounted cash flow estimation technique, adjusted for current conditions and reasonable and supportable forecasts, to estimate the expected credit losses of our loan segments, except consumer and other loans, which utilize the weighted average remaining maturity loss rate technique. See Note 1, "Basis of presentation and summary of significant accounting policies" in our Annual Report on Form 10-K for the year ended December 31, 2025, for further discussion on the change in estimate.
The discounted cash flow was calibrated using a regression analysis that relates one or more economic variables to our historical default rates and those of selected peer banks for each loan segment. We determined that national unemployment, national housing price index, national commercial real estate index and prime rates were the key economic variables that were most correlated to our historical loss performance and that of our peer banks. Reasonable and supportable forecasts of these economic indicators are utilized within the discounted cash flow to estimate expected credit losses for each loan segment. Current and forecast economic conditions, including those affecting these and other economic variables or macroeconomic conditions, such as global conflicts or tariffs, may continue to lead to increased volatility in our calculated level of allowance for credit losses.
Three months ended September 30, 2026 compared to three months ended September 30, 2025
We recognized a provision for credit losses on loans HFI of $1.2 million for the three months ended September 30, 2026, compared to a provision for credit losses of $30.0 million for the three months ended September 30, 2025. The provision expense for the three months ended September 30, 2026 was primarily driven by loan growth, partially offset by improvements in macroeconomic forecast assumptions used in the model. The prior year period included a $25.1 million initial provision on non-PCD acquired loans HFI from the Southern States merger, with the remaining expense driven by increased loan balances and a decline in the national home price index forecast assumption.
We also estimate expected credit losses on off-balance sheet loan commitments that are not accounted for as derivatives. When applying the CECL methodology to estimate expected credit loss, we consider the likelihood that funding will occur, the contractual period of exposure to credit loss, the risk of loss, historical loss experience, and current conditions along with expectations of future economic conditions. We recorded a provision for credit losses on unfunded commitments of $0.3 million and $4.5 million for the three months ended September 30, 2026 and 2025, respectively. The prior year period provision was due largely to the initial provision on acquired unfunded commitments from the Southern States merger of $3.2 million.
During the three months ended September 30, 2026 and 2025, we determined that all AFS debt securities that experienced a decline in fair value below amortized cost basis were due to noncredit-related factors. Therefore, there was no provision for credit losses recognized on AFS debt securities during the three months ended September 30, 2026 and 2025.
Nine months ended September 30, 2026 compared to nine months ended September 30, 2025
We recognized a provision for credit losses on loans HFI for the nine months ended September 30, 2026 and 2025 of $14.6 million and $30.8 million, respectively. The provision expense for the nine months ended September 30, 2026 was primarily driven by loan growth, a less favorable macroeconomic forecast, and reserves on individually evaluated loans. The prior year period included a $25.1 million initial provision on non-PCD acquired loans HFI from the Southern States merger, as well as provision expense related to changes in loan balances and forecast inputs, partially offset by a $6.8 million reduction from the impact of the change in the CECL loss estimation methodology. See further discussion under the subheading "Allowance for credit losses."
We recorded a reversal of credit losses on unfunded commitments of $0.1 million and provision expense of $11.3 million for the nine months ended September 30, 2026 and 2025, respectively. The decrease was primarily attributable to the prior year period, which included a $6.5 million reserve increase from the change in the CECL loss estimation methodology and a $3.2 million initial provision for acquired unfunded commitments associated with the Southern States merger.
During the nine months ended September 30, 2026 and 2025, we determined that all AFS debt securities that experienced a decline in fair value below amortized cost basis were due to noncredit-related factors. Therefore, there was no provision for credit losses recognized on AFS debt securities during the nine months ended September 30, 2026 and 2025.
Noninterest income
The following table sets forth the components of noninterest income for the periods indicated:
Three Months Ended September 30, Nine Months Ended September 30,
(dollars in thousands) 2026 2025 2026 2025
Mortgage banking income $ 9,425 $ 13,484 $ 32,848 $ 38,939
Investment services and trust income 4,931 4,227 13,796 11,860
Service charges on deposit accounts 4,484 4,049 13,328 10,920
ATM and interchange fees 3,262 3,388 9,513 8,943
(Loss) gain from investment securities, net (241) 12 (240) (60,521)
Loss on sales or write-downs of premises and equipment, other real estate owned and other assets (34) (646) (731) (1,035)
Other income 2,713 2,121 8,181 6,009
Total noninterest income $ 24,540 $ 26,635 $ 76,695 $ 15,115
Three months ended September 30, 2026 compared to three months ended September 30, 2025
Noninterest income amounted to $24.5 million for the three months ended September 30, 2026, a decrease of $2.1 million, as compared to $26.6 million for the three months ended September 30, 2025. The decrease in noninterest income was due to a decrease in mortgage banking income partially offset by increases in investment services and trust income, other income and service charges on deposit accounts, as well as lower losses on sales or write-downs of premises and equipment, other real estate owned and other assets.
Mortgage banking income includes origination fees, gains and losses on the sale of mortgage loans, changes in fair value of mortgage loans and related derivatives, as well as mortgage servicing income, which includes the change in fair value of MSRs and related derivatives. Mortgage banking income was $9.4 million for the three months ended September 30, 2026, a decrease of $4.1 million compared to the prior period. The decrease was primarily due to lower gains and fees from the origination and sale of mortgage loans held for sale and a decrease in the net change in fair value of loans held for sale and related derivatives.
Investment services and trust income is comprised of wealth management fees and trust and insurance income. This caption increased $0.7 million during the three months ended September 30, 2026 to $4.9 million as compared to $4.2 million during the three months ended September 30, 2025.
Service charges on deposit accounts include overdraft fees, account analysis fees and other customer transaction-related service charges. Service charges on deposit accounts increased $0.4 million during the three months ended September 30, 2026 to $4.5 million as compared to $4.0 million during the three months ended September 30, 2025.
ATM and interchange fees represent income related to customers' utilization of their debit cards and interchange income. ATM and interchange fees were $3.3 million for the three months ended September 30, 2026, compared to $3.4 million for the three months ended September 30, 2025.
Net loss from investment securities was $241 thousand for the three months ended September 30, 2026 compared to a net gain of $12 thousand for the three months ended September 30, 2025.
Net loss on sales or write-downs of premises and equipment, other real estate owned and other assets was $34 thousand for the three months ended September 30, 2026 compared to $0.6 million for the three months ended September 30, 2025.
Other income is comprised of income recognized that does not typically fit into income categories and includes components such as BOLI income, swap fees, and equity investments income. Other income increased $0.6 million to $2.7 million during the three months ended September 30, 2026 as compared to $2.1 million during the three months ended September 30, 2025.
Nine months ended September 30, 2026 compared to nine months ended September 30, 2025
Noninterest income amounted to $76.7 million for the nine months ended September 30, 2026, an increase of $61.6 million, as compared to $15.1 million for the nine months ended September 30, 2025. Excluding the recognition of the $60.5 million of net loss from investment securities sales recognized during the nine months ended September 30, 2025, noninterest income was $75.6 million for the nine months ended September 30, 2025.
Mortgage banking income was $32.8 million for the nine months ended September 30, 2026, a decrease of $6.1 million compared to the prior period. The decrease primarily reflects declines in the net change in fair value of loans held for sale and related derivatives and in the change in fair value on MSRs, net of hedging, as well as lower mortgage servicing income.
Investment services and trust income increased $1.9 million during the nine months ended September 30, 2026 to $13.8 million as compared to $11.9 million during the nine months ended September 30, 2025. This growth was driven primarily by higher fees resulting from increased assets under management in existing accounts.
Service charges on deposit accounts increased $2.4 million during the nine months ended September 30, 2026 to $13.3 million as compared to $10.9 million during the nine months ended September 30, 2025. The increase was primarily due to the increase in deposit accounts from the Southern States merger.
ATM and interchange fees were $9.5 million for the nine months ended September 30, 2026, compared to $8.9 million for the nine months ended September 30, 2025.
Net loss from investment securities was $240 thousand for the nine months ended September 30, 2026 compared to $60.5 million for the nine months ended September 30, 2025. The net loss from investment securities during the nine months ended September 30, 2025 was the result of management's election to sell $266.9 million of AFS debt securities. Refer to the section "Other earning assets" for additional information on the sale of the AFS debt securities.
Net loss on sales or write-downs of premises and equipment, other real estate owned and other assets improved by $0.3 million for the nine months ended September 30, 2026.
Other income increased $2.2 million to $8.2 million during the nine months ended September 30, 2026 as compared to $6.0 million during the nine months ended September 30, 2025. This increase reflects higher BOLI income of $1.3 million, largely due to $0.8 million of death benefit proceeds recognized during the nine months ended September 30, 2026.
Noninterest expense
The following table sets forth the components of noninterest expense for the periods indicated:
Three Months Ended September 30, Nine Months Ended September 30,
(dollars in thousands) 2026 2025 2026 2025
Salaries, commissions and employee benefits $ 56,054 $ 59,210 $ 166,734 $ 154,192
Occupancy and equipment expense 7,576 7,539 22,669 20,846
Advertising 3,013 2,453 7,717 7,118
Data processing 2,562 2,457 7,368 6,931
Legal and professional fees 2,046 1,227 5,908 5,645
Amortization of core deposit and other intangibles 1,741 2,079 5,414 3,366
Merger and integration costs - 16,057 1,447 19,192
Other expense 23,042 18,834 65,421 53,376
Total noninterest expense $ 96,034 $ 109,856 $ 282,678 $ 270,666
Three months ended September 30, 2026 compared to three months ended September 30, 2025
Noninterest expense decreased by $13.8 million, or 12.6%, during the three months ended September 30, 2026 to $96.0 million as compared to $109.9 million in the three months ended September 30, 2025. The decrease in noninterest expense was primarily driven by merger and integration costs associated with the Southern States merger recognized in the prior year and a decrease in salaries, commissions and employee benefits, partially offset by increases in other expense and legal and professional fees.
Salaries, commissions and employee benefits expense is comprised of salaries and wages in addition to other employee benefit costs and represents the largest component of noninterest expense. For the three months ended September 30, 2026, salaries, commissions and employee benefits expense decreased $3.2 million, to $56.1 million as compared to $59.2 million for the three months ended September 30, 2025. The decrease was primarily driven by higher deferred salary costs related to loan originations during the period and lower performance-based compensation compared to the three months ended September 30, 2025.
Occupancy and equipment expense includes occupancy, depreciation and equipment expense. Occupancy and equipment expense of $7.6 million and $7.5 million was recognized for the three months ended September 30, 2026 and 2025, respectively.
Advertising includes expenses related to sponsorships, advertising, marketing, customer relations and business development and public relations. During the three months ended September 30, 2026, advertising expense increased $0.6 million to $3.0 million compared to $2.5 million during the three months ended September 30, 2025.
Data processing is comprised of all third-party core operating system and processing charges as well as payroll processing. Data processing fees were $2.6 million for the three months ended September 30, 2026, compared to $2.5 million for the three months ended September 30, 2025.
Legal and professional fees represent fees incurred for the various support functions, which include legal, consulting, outsourcing and other professional related fees. Legal and professional fees were $2.0 million and $1.2 million for the three months ended September 30, 2026 and 2025, respectively.
Amortization of core deposit and other intangibles was $1.7 million for the three months ended September 30, 2026, compared to $2.1 million for the three months ended September 30, 2025.
Merger and integration costs include costs associated with the merger, integration and conversion of business combinations. Merger and integration costs were $16.1 million for the three months ended September 30, 2025. These costs primarily include legal and other professional fees, severance and other employee-related costs, and costs associated with branch consolidation, conversion and integration activities. There were no such costs for the three months ended September 30, 2026.
Other expense is comprised of expense that does not typically fit into other expense categories and includes mortgage servicing expenses, regulatory fees and deposit insurance assessments, software license and maintenance fees and various other miscellaneous expenses. Other expense increased $4.2 million during the three months ended September 30, 2026 to $23.0 million compared to $18.8 million during the three months ended September 30, 2025. The increase was driven by a $1.0 million increase in subservicer fees, of which $0.7 million was associated with the transition to a new mortgage subservicer, and broad-based increases across a range of expense categories, including franchise taxes, regulatory costs and software license and maintenance fees.
Nine months ended September 30, 2026 compared to nine months ended September 30, 2025
Noninterest expense increased by $12.0 million, or 4.4%, during the nine months ended September 30, 2026 to $282.7 million as compared to $270.7 million in the nine months ended September 30, 2025. The increase in noninterest expense was attributable to increases in salaries, commissions and employee benefits, amortization of core deposit intangible and other intangibles, occupancy and other noninterest expense partially offset by a decrease in merger and integration costs associated with the Southern States merger.
Salaries, commissions and employee benefits expense increased $12.5 million, or 8.1%, to $166.7 million for the nine months ended September 30, 2026 as compared to $154.2 million for the nine months ended September 30, 2025. Higher salaries and benefit costs related to the Southern States merger, together with increased bonus and commissions, contributed to the increase. These increases were partially offset by deferred salary costs related to loan originations during the current period and lower performance-based equity compensation.
Occupancy and equipment expense of $22.7 million and $20.8 million was recognized for the nine months ended September 30, 2026 and 2025, respectively. The increase was driven by the expansion of our branch network in connection with the Southern States merger.
Advertising expense was $7.7 million and $7.1 million for the nine months ended September 30, 2026 and 2025, respectively.
Data processing fees were $7.4 million for the nine months ended September 30, 2026, compared to $6.9 million for the nine months ended September 30, 2025.
Legal and professional fees were $5.9 million and $5.6 million for the nine months ended September 30, 2026 and 2025, respectively.
Amortization of core deposit and other intangibles was $5.4 million for the nine months ended September 30, 2026, compared to $3.4 million for the nine months ended September 30, 2025. The increase primarily reflects a full nine months of amortization of the core deposit intangible assumed in the Southern States merger, which totaled $4.2 million for the nine months ended September 30, 2026, compared to $1.5 million for the prior year, which included only one quarter of amortization following the July 1, 2025 merger.
Merger and integration costs were $1.4 million for the nine months ended September 30, 2026 associated with the merger with Southern States compared to $19.2 million for the nine months ended September 30, 2025. These costs primarily include legal and other professional fees, severance and other employee-related costs, and costs associated with branch consolidation, conversion and integration activities.
Other expense increased $12.0 million during the nine months ended September 30, 2026 to $65.4 million compared to $53.4 million during the nine months ended September 30, 2025. The increase was attributable to a $2.7 million increase in franchise tax expense, a $2.2 million increase in software license and maintenance fees, and broad-based increases across several expense categories, including regulatory costs, card transaction fees, contributions and dues, and subservicer fees.
Efficiency ratio
The efficiency ratio is one measure of productivity in the banking industry. This ratio is calculated to measure the cost of generating one dollar of revenue. That is, the ratio is designed to reflect the percentage of one dollar which must be expended to generate that dollar of revenue. We calculate this ratio by dividing noninterest expense by the sum of net interest income and noninterest income. For an adjusted efficiency ratio, we exclude certain gains, losses and expenses we do not consider core to our business.
Our efficiency ratio was 55.0% and 54.2% for the three and nine months ended September 30, 2026, respectively, and 63.2% and 71.0% for the three and nine months ended September 30, 2025, respectively. Our adjusted efficiency ratio, on a tax-equivalent basis, was 54.3% and 53.5% for the three and nine months ended September 30, 2026, respectively, and 53.3% and 56.4% for the three and nine months ended September 30, 2025, respectively. See "GAAP reconciliation and management explanation of non-GAAP financial measures" in this Report for a discussion of the adjusted efficiency ratio.
Income taxes
Income tax expense was $16.8 million and $48.0 million for the three and nine months ended September 30, 2026, respectively, compared to $6.2 million and $3.0 million for the three and nine months ended September 30, 2025, respectively. This represents effective tax rates of 21.8% and 21.4% for the three and nine months ended September 30, 2026, respectively, and 21.0% and 4.4% for the three and nine months ended September 30, 2025, respectively. The primary differences from the enacted federal statutory rate are applicable state income taxes, tax credits, and certain non-deductible expenses, including limitations under Section 162(m). For the nine months ended September 30, 2025, income tax expense includes the income tax effect of a $60.5 million loss on sale of AFS debt securities and a one-time gross tax benefit of $10.7 million due to the expiration of the statute of limitations with respect to an amended income tax return and the associated interest. Additionally, income tax expense for the three and nine months ended September 30, 2026 reflects a reduction of $0.9 million and $2.8 million, respectively, related to transferable tax credits that will be applied to 2026 income taxes. Refer to Note 9 "Income taxes" in the notes to the consolidated financial statements for additional information regarding our income tax expense and effective tax rates.
Financial condition
The following discussion of our financial condition compares balances as of September 30, 2026 and December 31, 2025.
Loan portfolio
The following table sets forth the balance and associated percentage of each class of financing receivable in our loan portfolio as of the dates indicated:
September 30, December 31,
2026 2025
(dollars in thousands) Committed Amount Outstanding % of total outstanding Committed Amount Outstanding % of total outstanding
Loan Type:
Commercial and industrial
 		$ 3,804,946 $ 2,258,655 17 % $ 3,646,142 $ 2,181,935 18 %
Construction 1,988,941 1,177,433 9 % 1,893,275 1,188,494 10 %
Residential real estate:
1-to-4 family mortgage 2,065,352 2,051,105 16 % 1,855,064 1,838,122 15 %
Residential line of credit 1,672,214 812,771 6 % 1,569,351 741,309 6 %
Multi-family mortgage 816,169 809,083 6 % 752,058 745,360 6 %
Commercial real estate:
Owner-occupied 2,402,423 2,282,155 17 % 2,241,135 2,148,870 17 %
Non-owner occupied 3,174,139 3,079,035 23 % 2,965,536 2,900,499 23 %
Consumer and other 748,120 709,327 6 % 659,567 639,037 5 %
Total loans $ 16,672,304 $ 13,179,564 100 % $ 15,582,128 $ 12,383,626 100 %
Our loans HFI portfolio is our most significant earning asset, comprising 77.1% and 76.0% of our total assets at September 30, 2026 and December 31, 2025, respectively. Our strategy is to grow our loan portfolio by originating quality commercial and consumer type loans that comply with our credit policies and that produce revenues consistent with our financial objectives. Our overall lending approach is primarily focused on providing credit to our customers directly in the markets we serve. However, we also participate in loan syndications and participations from other banks (collectively, "participated loans"). As of September 30, 2026 and December 31, 2025, loans HFI included approximately $377.5 million and $433.2 million, respectively, related to participated loans.
We also sell loan participations to unaffiliated third parties as part of our credit risk management and balance sheet management strategy. During the three months ended September 30, 2026 and 2025, we sold $7.4 million and $10.0 million of loan participations, respectively. During the nine months ended September 30, 2026 and 2025, we sold $13.9 million and $13.5 million of loan participations, respectively. All loans, whether or not we act as a participant, are underwritten to the same standards as all other loans we originate. We believe our loan portfolio is well-balanced, which provides us with the opportunity to grow while monitoring our loan concentrations.
Loan concentrations are considered to exist when there are amounts loaned to a number of borrowers engaged in similar activities that would cause them to be similarly impacted by economic or other conditions. Our lending activity is heavily concentrated in the geographic market areas we serve, with the highest concentration in Tennessee. This geographic concentration subjects our loan portfolio to the general economic conditions within the state. The risks created by this concentration have been considered by management in the determination of the appropriateness of the allowance for credit losses on loans HFI. As of September 30, 2026 and December 31, 2025, there were no concentrations of loans exceeding 10% of total loans other than our geographic exposure to Tennessee, Alabama and Georgia, as well as the categories of loans disclosed in the table above. We believe our loan portfolio is diversified relative to industry concentrations across the various loan portfolio categories. For additional details related to the concentrations within our loan portfolio, refer to the industry classification and collateral property type concentration tables detailed later in this section.
Banking regulators have established guidelines of less than 100% of Tier 1 capital plus allowance for credit losses in construction lending and less than 300% of Tier 1 capital plus allowance for credit losses in commercial real estate lending that management monitors as part of the risk management process. The construction concentration ratio is a percentage of the outstanding construction and land development loans to total Tier 1 capital plus allowance for credit losses. The commercial real estate concentration ratio is a percentage of the outstanding balance of non-owner occupied commercial real estate, multi-family, and construction and land development loans to Tier 1 capital plus allowance for credit losses. Management strives to operate within the thresholds set forth above. When our ratios are in excess of one or both of these guidelines, banking regulators generally require an increased level of monitoring in these lending areas by management.
The table below shows concentration ratios for the Bank and Company as of September 30, 2026 and December 31, 2025.
As a percentage (%) of Tier 1 capital plus allowance for credit losses
FirstBank FB Financial Corporation
September 30, 2026
Construction 58.9 % 64.0 %
Commercial real estate 254.4 % 276.3 %
December 31, 2025
Construction 64.6 % 65.6 %
Commercial real estate 264.5 % 268.4 %
Loan categories:
The principal categories of our loans held for investment portfolio are discussed below:
Commercial and industrial loans.
Commercial and industrial loans are typically made to small and medium-sized manufacturing, wholesale, retail and service businesses, and farmers for working capital and operating needs and business expansions. This category also includes loans secured by manufactured housing receivables made primarily to manufactured housing communities. Commercial and industrial loans generally include lines of credit and loans with maturities of five years or less. Commercial and industrial loans are generally made with operating cash flows as the primary source of repayment, but also include collateralization by inventory, accounts receivable, equipment and personal guarantees. This loan segment also includes our farmland and agriculture loans which are underwritten with various terms and payment schedules and are generally collateralized by real estate, crop production, or other related assets.
Construction loans.
Construction loans include commercial construction, land acquisition and land development loans and single-family interim construction loans to small and medium-sized businesses and individuals. These loans are generally secured by the land, or the real property being built and are made based on our assessment of the value of the property on an as-completed basis and repayment depends upon project completion and sale, refinancing, or operation of the real estate.
1-to-4 family mortgage loans.
Our residential real estate 1-to-4 family mortgage loans are primarily made with respect to and secured by single family homes in a first lien position which are both owner-occupied and investor owned. This pool also includes 100% financed mortgages that consist of 1-to-4 family mortgages that are originated under a 100% financing program. 100% financed mortgage loans are further evaluated separately from the 1-to-4 family mortgage pool due to high initial loan-to-value. This pool also includes our manufactured housing loans secured by real estate collateral. Repayment of loans in this loan segment is primarily dependent upon the cash flow of the borrower and the value of the property.
Residential line of credit loans.
Our residential line of credit loans include junior liens and consist of revolving lines of credit and term notes that are typically not in first position for liquidation preference. Repayment depends primarily on the cash flow of the borrower as well as the value of the real estate collateral.
Multi-family residential loans.
Our multi-family residential loans are primarily secured by multi-family properties, such as apartments and condominium buildings. Repayment depends primarily upon the cash flow of the borrower as well as the value of the real estate collateral.
Commercial real estate owner-occupied loans.
Our commercial real estate owner-occupied loans include loans to finance commercial real estate owner occupied properties for various purposes including use as offices, warehouses, production facilities, health care facilities, retail centers, restaurants, and church facilities. Commercial real estate owner-occupied loans are typically repaid through the ongoing business operations of the borrower.
Commercial real estate non-owner occupied loans.
Our commercial real estate non-owner occupied loans include loans to finance commercial real estate investment properties for various purposes including use as offices, warehouses, health care facilities, hotels, mixed-use residential/commercial, manufactured housing communities, retail centers, multi-family properties, and assisted living facilities. Commercial real estate non-owner occupied loans are typically repaid with rental income from such property or the funds received from the sale or refinancing of the property.
Consumer and other loans.
Our consumer and other loans include loans to individuals for personal, family and household purposes, including car, boat and other recreational vehicle loans and personal lines of credit. Consumer loans are generally secured by vehicles and other household goods, with repayment depending primarily on the cash flow of the borrower. Consumer and other loans also include manufactured housing loans which are comprised of loans collateralized by manufactured housing not secured by real estate. These manufactured housing loans exhibit risk characteristics similar to both 1-to-4 family loans and consumer loans and are therefore further evaluated in a separate pool. Repayment is dependent upon the cash flow of the borrower and the value of the property. Other loans include municipal loans to states and political subdivisions in the U.S. and are repaid through tax revenues or refinancing.
As part of our lending policy and risk management activities, we track lending exposure of commercial and industrial and owner-occupied commercial real estate by industry classification (as defined by the North American Industry Classification System) and type to identify potential risks associated with industry concentrations and determine whether such risks could lead to additional credit loss exposure. The table below provides a summary of our commercial and industrial and owner-occupied commercial real estate portfolios by industry classification.
September 30, 2026
(dollars in thousands) Committed Amount Outstanding
Nonperforming(1)
Commercial and industrial
Real estate rental and leasing $ 550,612 $ 319,870 $ 500
Construction 515,833 197,790 597
Finance and insurance 490,668 354,757 928
Manufacturing 373,230 243,814 13,171
Wholesale trade 318,059 196,290 574
Professional, scientific and technical services 212,427 123,241 80
Retail trade 148,511 108,410 31
Educational services 147,865 23,002 -
Transportation and warehousing 146,373 131,275 1,790
Information 143,871 90,181 -
Arts, entertainment and recreation 124,566 74,857 112
Administrative and support and waste management and
remediation services 		113,257 91,386 2,008
Other services (except public administration) 106,946 83,992 563
Accommodation and food services 99,996 74,069 476
Health care and social assistance 96,764 51,535 334
Management of companies and enterprises 57,360 42,110 -
Other 158,608 52,076 432
Total $ 3,804,946 $ 2,258,655 $ 21,596
Commercial real estate owner-occupied
Retail trade $ 451,328 $ 439,246 $ -
Manufacturing 301,257 293,020 649
Other services (except public administration) 300,789 285,736 3,651
Real estate rental and leasing 285,981 272,451 1,747
Health care and social assistance 222,102 212,625 391
Accommodation and food services 200,201 199,385 1,318
Construction 109,744 90,454 -
Wholesale trade 106,948 98,240 -
Transportation and warehousing 106,545 93,506 62
Arts, entertainment and recreation 80,760 78,056 -
Professional, scientific and technical services 61,427 59,862 2,126
Agriculture, forestry, fishing and hunting 52,226 46,217 817
Educational services 31,815 31,257 497
Administrative and support and waste management and
remediation services 		30,077 28,733 434
Management of companies and enterprises 20,207 14,936 -
Finance and insurance 19,480 17,154 2,668
Other 21,536 21,277 1,347
Total $ 2,402,423 $ 2,282,155 $ 15,707
(1) Nonperforming loans are those on which the accrual of interest has stopped, as well as loans that are contractually 90 or more days past due on which interest continues to accrue.
Additionally, we track our lending exposure of non-owner occupied commercial real estate and construction by collateral property type to identify potential risks associated with collateral types and determine whether such risks could lead to additional credit loss exposure. The table below provides a summary of our non-owner occupied commercial real estate and construction loan portfolios by collateral property type.
September 30, 2026
(dollars in thousands) Committed Amount Outstanding
Nonperforming(1)
Commercial real estate non-owner occupied
Warehouse and industrial $ 714,734 $ 687,428 $ 2,316
Retail 611,346 600,336 11,808
Hotel 527,685 526,146 -
Office 503,750 489,283 6,056
Assisted living and special care facilities 204,094 202,354 -
Self-storage 144,324 142,836 104
Land-manufactured housing 143,171 130,821 129
Restaurants, bars and event venues 60,834 51,143 1,008
Healthcare facility 55,312 55,277 -
Convenience store and gas station 46,141 45,543 -
Recreation, sports and entertainment 21,646 20,744 -
Other 141,102 127,124 1,139
Total $ 3,174,139 $ 3,079,035 $ 22,560
Construction
Consumer:
Construction $ 238,113 $ 147,053 $ 16,204
Land 90,214 83,025 1,149
Commercial:
Land 286,355 231,823 1,683
Multi-family 206,288 102,926 -
Retail 116,198 76,078 -
Recreation, sports and entertainment 69,640 18,272 -
Special care facility 66,571 3,719 -
Self-storage 60,990 27,089 -
Healthcare 58,234 32,895 -
Hotel 45,289 17,675 -
Office 31,351 23,551 -
Convenience store and gas station 18,737 10,510 -
Car wash 11,073 6,790 -
Other 83,073 37,573 -
Residential Development:
Construction 473,423 268,847 11,127
Land 104,400 61,075 -
Lots 28,992 28,532 597
Total $ 1,988,941 $ 1,177,433 $ 30,760
(1) Nonperforming loans are those on which the accrual of interest has stopped, as well as loans that are contractually 90 or more days past due on which interest continues to accrue.
Loan maturity and sensitivities
The following table presents the contractual maturities of our loan portfolio as of September 30, 2026. Loans with scheduled maturities are reported in the maturity category in which the payment is due. Demand loans with no stated maturity and overdrafts are reported in the "due in 1 year or less" category. Loans that have adjustable rates are shown as amortizing to final maturity rather than when the interest rates are next subject to change. The tables do not include prepayment assumptions or scheduled repayments.
September 30, 2026
Loan type (dollars in thousands) Maturing in one
year or less 		Maturing in one
to five years 		Maturing in
five to fifteen years 		Maturing after
fifteen years 		Total
Commercial and industrial $ 893,022 $ 1,055,354 $ 307,601 $ 2,678 $ 2,258,655
Construction 487,407 516,833 142,793 30,400 1,177,433
Residential real estate:
1-to-4 family mortgage 190,793 547,242 162,750 1,150,320 2,051,105
Residential line of credit 87,509 181,258 544,004 - 812,771
Multi-family mortgage 331,157 320,865 149,917 7,144 809,083
Commercial real estate:
Owner-occupied 345,054 1,209,283 482,057 245,761 2,282,155
Non-owner occupied 605,470 1,793,504 595,593 84,468 3,079,035
Consumer and other 35,616 104,270 153,299 416,142 709,327
Total ($) $ 2,976,028 $ 5,728,609 $ 2,538,014 $ 1,936,913 $ 13,179,564
Total (%) 22.6 % 43.4 % 19.3 % 14.7 % 100.0 %
For loans due after one year, the following table presents the interest rate composition for loans outstanding as of September 30, 2026.
September 30, 2026
Loan type (dollars in thousands) Fixed
interest rate 		Floating
interest rate 		Total
Commercial and industrial $ 542,305 $ 823,328 $ 1,365,633
Construction 160,614 529,412 690,026
Residential real estate:
1-to-4 family mortgage 1,294,458 565,854 1,860,312
Residential line of credit 4,619 720,643 725,262
Multi-family mortgage 216,453 261,473 477,926
Commercial real estate:
Owner-occupied 1,146,431 790,670 1,937,101
Non-owner occupied 1,060,483 1,413,082 2,473,565
Consumer and other 598,963 74,748 673,711
Total ($) $ 5,024,326 $ 5,179,210 $ 10,203,536
Total (%) 49.2 % 50.8 % 100.0 %
The following table presents the contractual maturities of our loan portfolio segregated into fixed and floating interest rate loans as of September 30, 2026.
September 30, 2026
Contractual maturity (dollars in thousands) Fixed
interest rate 		Floating
interest rate 		Total
One year or less $ 1,218,733 $ 1,757,295 $ 2,976,028
One to five years 2,759,538 2,969,071 5,728,609
Five to fifteen years 1,006,795 1,531,219 2,538,014
Over fifteen years 1,257,993 678,920 1,936,913
Total ($) $ 6,243,059 $ 6,936,505 $ 13,179,564
Total (%) 47.4 % 52.6 % 100.0 %
Asset quality
In order to operate with a sound risk profile, we focus on originating loans that we believe to be of high quality. We have established loan approval policies and procedures to assist us in maintaining the overall quality of our loan portfolio. When delinquencies in our loans exist, we rigorously monitor the levels of such delinquencies for any negative or adverse trends. From time to time, we may modify loans to extend the term or make other concessions, including interest rate reduction, a term extension, principal forgiveness, payment deferral, or a combination thereof, to help a borrower with a deteriorating financial condition stay current on their loan and to avoid foreclosure. Furthermore, we are committed to collecting on all of our loans. This practice leads to higher recoveries in the long term.
Nonperforming assets
Our nonperforming assets consist of nonperforming loans, other real estate owned and other repossessed non-earning assets. As of September 30, 2026 and December 31, 2025, we had $193.8 million and $158.1 million, respectively, in nonperforming assets. Nonperforming loans are those on which the accrual of interest has stopped, as well as loans that are contractually 90 or more days past due on which interest continues to accrue. Accrued interest receivable written off as an adjustment to interest income amounted to $1.1 million and $0.5 million for the three months ended September 30, 2026 and 2025, respectively, and $1.8 million and $1.9 million for the nine months ended September 30, 2026 and 2025, respectively. Additionally, we had net interest recoveries on nonperforming assets previously charged off of $0.2 million and $0.5 million, respectively, for the three months ended September 30, 2026 and 2025, and $1.1 million and $1.4 million for the nine months ended September 30, 2026 and 2025, respectively.
Nonperforming loans HFI increased by $35.3 million to $155.8 million as of September 30, 2026 compared to $120.5 million as of December 31, 2025. The increase primarily reflected higher nonperforming balances in the commercial real estate and commercial and industrial portfolios, including one significant relationship in each portfolio that migrated to nonperforming status during the current period. These increases were partially offset by decreases within the construction and 1-to-4 family mortgage portfolios. The increase in nonperforming loans also contributed to higher classified loan balances during the period.
As of September 30, 2026 and December 31, 2025, we had $29.1 million and $28.1 million, respectively, of delinquent GNMA optional repurchase loans previously sold included on our consolidated balance sheets in loans held for sale. These are considered nonperforming assets as we do not earn any interest on the unexercised option to repurchase these loans. The following table provides details of our nonperforming assets, the ratio of such loans and other nonperforming assets to total assets, and certain other related information as of the dates presented:
September 30, December 31,
(dollars in thousands) 2026 2025 2025
Loan Type:
Commercial and industrial $ 21,596 $ 6,926 $ 6,373
Construction 30,760 31,368 34,208
Residential real estate:
1-to-4 family mortgage 31,346 29,445 32,505
Residential line of credit 1,417 2,342 2,014
Multi-family mortgage 7,418 9,325 8,199
Commercial real estate:
Owner-occupied 15,707 11,000 10,606
Non-owner occupied 22,560 5,649 4,514
Consumer and other 24,957 19,704 22,053
Total nonperforming loans HFI $ 155,761 $ 115,759 $ 120,472
Mortgage loans held for sale(1)
29,134 21,660 28,102
Other real estate owned 4,655 4,466 6,009
Other repossessed assets 4,277 3,314 3,564
Total nonperforming assets $ 193,827 $ 145,199 $ 158,147
Nonperforming loans HFI as a percentage of total loans HFI 1.18 % 0.94 % 0.97 %
Nonperforming assets as a percentage of total assets 1.13 % 0.89 % 0.97 %
Nonaccrual loans HFI as a percentage of loans HFI 0.94 % 0.73 % 0.71 %
(1) Represents optional right to repurchase government guaranteed GNMA mortgage loans previously sold that meet certain defined delinquency criteria.
We have evaluated our loans HFI classified as nonperforming and believe all nonperforming loans have been adequately reserved for in the allowance for credit losses on loans HFI as of September 30, 2026 and December 31, 2025. Management also continually monitors past due loans for potential credit quality deterioration. Loans not considered nonperforming include loans 30-89 days past due that continue to accrue interest amounting to $77.0 million at September 30, 2026 as compared to $66.8 million at December 31, 2025. The increase from December 31, 2025 to September 30, 2026 was primarily due to increases within our commercial real estate portfolios and residential lines of credit partially offset by decreases in our multi-family, 1-to-4 family mortgages, consumer and other, and commercial and industrial portfolios.
Allowance for credit losses
The allowance for credit losses represents the portion of the loan's amortized cost basis that we do not expect to collect due to credit losses over the loan's life, considering past events, current conditions, and reasonable and supportable forecasts of future economic conditions. Loan losses are charged against the allowance when we believe the uncollectibility of a loan balance is confirmed. Subsequent recoveries, if any, are credited to the allowance. The allowance for credit losses is based on the loan's amortized cost basis, excluding accrued interest receivable, as we promptly charge off uncollectible accrued interest receivable.
Effective June 30, 2025, we changed certain estimation techniques, inputs, and assumptions used to estimate expected credit losses on loan portfolios and unfunded commitments. Following a periodic review of our credit loss estimation process, we adopted a discounted cash flow methodology, adjusted for current conditions and reasonable and supportable forecasts, for all loan segments except consumer and other loans, which continue to utilize the weighted average remaining maturity methodology. The same methodologies are used to estimate expected credit losses on off-balance sheet commitments. Additional information regarding these changes is included in Note 1, "Basis of presentation and summary of significant accounting policies," to our Annual Report on Form 10-K for the year ended December 31, 2025.
The following table presents the allocation of the allowance for credit losses by loan HFI category as well as the ratio of loans by loan category compared to the total loans HFI portfolio as of the dates indicated:
September 30, December 31,
2026 2025
(dollars in thousands) Amount ACL
as a % of loans HFI category 		% of
loans to total loans HFI 		Amount ACL
as a % of loans HFI category 		% of
loans to total loans HFI
Loan Type:
Commercial and industrial $ 25,831 1.14 % 17 % $ 24,130 1.11 % 18 %
Construction 26,772 2.27 % 9 % 25,633 2.16 % 10 %
Residential real estate:
1-to-4 family mortgage 36,023 1.76 % 16 % 33,218 1.81 % 15 %
Residential line of credit 9,997 1.23 % 6 % 10,589 1.43 % 6 %
Multi-family mortgage 11,725 1.45 % 6 % 12,260 1.64 % 6 %
Commercial real estate:
Owner-occupied 19,538 0.86 % 17 % 21,609 1.01 % 17 %
Non-owner occupied 41,952 1.36 % 23 % 36,235 1.25 % 23 %
Consumer and other 22,122 3.12 % 6 % 22,309 3.49 % 5 %
Total allowance for credit losses on loans HFI $ 193,960 1.47 % 100 % $ 185,983 1.50 % 100 %
The following table summarizes activity in our allowance for credit losses on loans HFI during the periods indicated:
Three Months Ended September 30, Nine Months Ended September 30, Year Ended
December 31,
(dollars in thousands) 2026 2025 2026 2025 2025
Allowance for credit losses on loans HFI at beginning
of period 		$ 194,010 $ 148,948 $ 185,983 $ 151,942 $ 151,942
Initial allowance for credit losses on loans purchased with
credit deterioration 		- 7,518 - 7,518 7,518
Charge-offs:
Commercial and industrial - (100) (2,805) (3,071) (3,136)
Construction - (399) (315) (399) (399)
Residential real estate:
1-to-4 family mortgage (120) (322) (946) (758) (1,126)
Residential line of credit (5) - (28) - -
Commercial real estate:
Owner-occupied - - - (17) (17)
Consumer and other (1,749) (888) (4,295) (2,811) (4,196)
Total charge-offs $ (1,874) $ (1,709) $ (8,389) $ (7,056) $ (8,874)
Recoveries:
Commercial and industrial $ 28 $ 12 $ 277 $ 227 $ 386
Construction - - 27 - -
Residential real estate:
1-to-4 family mortgage 15 6 81 26 39
Residential line of credit 1 11 2 12 12
Commercial real estate:
Owner-occupied 10 4 39 34 42
Non-owner occupied - - - 529 529
Consumer and other 603 246 1,296 1,000 1,200
Total recoveries $ 657 $ 279 $ 1,722 $ 1,828 $ 2,208
Net charge-offs (1,217) (1,430) (6,667) (5,228) (6,666)
Impact of change in accounting estimate for current expected
credit losses(1)
- - - (6,848) (6,848)
Provision for credit losses on loans HFI(1)
1,167 29,957 14,644 37,609 40,037
Allowance for credit losses on loans HFI at the end of period $ 193,960 $ 184,993 $ 193,960 $ 184,993 $ 185,983
Ratio of net charge-offs during the period to average loans
outstanding during the period 		(0.04) % (0.05) % (0.07) % (0.07) % (0.06) %
Allowance for credit losses on loans HFI as a percentage of
loans 		1.47 % 1.50 % 1.47 % 1.50 % 1.50 %
Allowance for credit losses on loans HFI as a percentage of
nonaccrual loans HFI 		155.9 % 206.8 % 155.9 % 206.8 % 212.0 %
Allowance for credit losses on loans HFI as a percentage of
nonperforming loans 		124.5 % 159.8 % 124.5 % 159.8 % 154.4 %
(1) Includes the impact of changes to estimation techniques, inputs and assumptions used to estimate credit losses during the year ended December 31, 2025. See Note 1, "Basis of presentation and summary of significant accounting policies" in our Annual Report on Form 10-K for the year ended December 31, 2025 for further discussion on the change in estimate.
The following table details our (reversal of) provision for credit losses on loans HFI and net recoveries (charge-offs) to average loans HFI outstanding by loan category during the periods indicated:
(Reversal of) provision for credit losses on loans HFI(1)
Net recoveries (charge-offs) Average loans HFI Ratio of net (charge-offs) recoveries to average loans HFI
(dollars in thousands)
Three Months Ended September 30, 2026
Commercial and industrial $ (472) $ 28 $ 2,237,056 - %
Construction (685) - 1,181,811 - %
Residential real estate:
1-to-4 family mortgage 2,282 (105) 1,964,787 (0.02) %
Residential line of credit (185) (4) 804,989 - %
Multi-family mortgage 159 - 774,847 - %
Commercial real estate:
Owner-occupied (433) 10 2,255,053 - %
Non-owner occupied (51) - 3,010,019 - %
Consumer and other 552 (1,146) 749,076 (0.61) %
Total $ 1,167 $ (1,217) $ 12,977,638 (0.04) %
Three Months Ended September 30, 2025
Commercial and industrial $ 3,933 $ (88) $ 2,126,229 (0.02) %
Construction 6,110 (399) 1,210,516 (0.13) %
Residential real estate:
1-to-4 family mortgage 3,049 (316) 1,842,331 (0.07) %
Residential line of credit 1,745 11 691,276 0.01 %
Multi-family mortgage 762 - 716,327 - %
Commercial real estate:
Owner-occupied 6,902 4 2,087,903 - %
Non-owner occupied 4,352 - 2,866,100 - %
Consumer and other 3,104 (642) 648,719 (0.39) %
Total $ 29,957 $ (1,430) $ 12,189,401 (0.05) %
Nine Months Ended September 30, 2026
Commercial and industrial $ 4,229 $ (2,528) $ 2,222,899 (0.15) %
Construction 1,427 (288) 1,173,860 (0.03) %
Residential real estate:
1-to-4 family mortgage 3,670 (865) 1,886,064 (0.06) %
Residential line of credit (566) (26) 779,190 - %
Multi-family mortgage (535) - 755,694 - %
Commercial real estate:
Owner-occupied (2,110) 39 2,205,284 - %
Non-owner occupied 5,717 - 2,924,872 - %
Consumer and other 2,812 (2,999) 722,310 (0.56) %
Total $ 14,644 $ (6,667) $ 12,670,173 (0.07) %
Nine Months Ended September 30, 2025
Commercial and industrial $ 10,293 $ (2,844) $ 1,865,170 (0.20) %
Construction (3,740) (399) 1,101,647 (0.05) %
Residential real estate:
1-to-4 family mortgage 8,387 (732) 1,701,709 (0.06) %
Residential line of credit (537) 12 640,541 - %
Multi-family mortgage 1,144 - 662,196 - %
Commercial real estate:
Owner-occupied 6,835 17 1,600,407 - %
Non-owner occupied 4,595 529 2,381,324 0.03 %
Consumer and other 3,784 (1,811) 606,877 (0.40) %
Total $ 30,761 $ (5,228) $ 10,559,871 (0.07) %
Provision for (reversal of) credit losses on loans HFI(1)
Net (charge-offs) recoveries Average loans HFI Ratio of net (charge-offs) recoveries to average loans HFI
(dollars in thousands)
Year Ended December 31, 2025
Commercial and industrial $ 8,254 $ (2,750) $ 1,939,663 (0.14) %
Construction (5,964) (399) 1,123,085 (0.04) %
Residential real estate:
1-to-4 family mortgage 8,901 (1,087) 1,736,885 (0.06) %
Residential line of credit (406) 12 662,550 - %
Multi-family mortgage 1,589 - 680,205 - %
Commercial real estate:
Owner-occupied 8,076 25 1,730,888 - %
Non-owner occupied 6,757 529 2,519,175 0.02 %
Consumer and other 5,982 (2,996) 623,411 (0.48) %
Total $ 33,189 $ (6,666) $ 11,015,862 (0.06) %
(1) Includes the impact of changes to estimation techniques, inputs and assumptions used to estimate credit losses during the year ended December 31, 2025. See Note 1, "Basis of presentation and summary of significant accounting policies" in our Annual Report on Form 10-K for the year ended December 31, 2025 for further discussion on the change in estimate.
The ACL on loans HFI was $194.0 million and $186.0 million and represented 1.47% and 1.50% of loans HFI as of September 30, 2026 and December 31, 2025, respectively. For further information related to the change in the ACL, refer to the "Provision for credit losses" section herein and Note 4, "Loans and allowance for credit losses on loans HFI" in the notes to our consolidated financial statements.
Our ratio of total nonperforming loans HFI as a percentage of total loans HFI increased by 21 basis points to 1.18% as of September 30, 2026 compared to December 31, 2025 primarily due to increases in nonperforming loans within the commercial real estate and commercial and industrial portfolios, reflecting the migration of one significant relationship in each portfolio to nonperforming status during the current period. These increases were partially offset by decreases in the construction and 1-to-4 family mortgage portfolios. The increase in nonperforming loans also contributed to higher classified loan balances during the period. The relationships contributing to the increase were evaluated in accordance with our allowance for credit losses methodology, including consideration of collateral values and expected credit losses, where appropriate.
For the three months ended September 30, 2026, we experienced net charge-offs of $1.2 million, or 0.04% of average loans HFI, compared to net charge-offs of $1.4 million, or 0.05% for the three months ended September 30, 2025. For the nine months ended September 30, 2026, we experienced net charge-offs of $6.7 million, or 0.07% of average loans HFI, compared to net charge-offs of $5.2 million, or 0.07% for the nine months ended September 30, 2025. We also maintain an allowance for credit losses on unfunded commitments in other liabilities, which decreased to $16.1 million as of September 30, 2026 from $16.2 million as of December 31, 2025 primarily due to changes in segment-level reserve rates and shifts in the mix of available commitments across calculation segments.
Loans held for sale
As of September 30, 2026, mortgage loans held for sale consisted of $225.9 million of residential real estate mortgage loans in the process of being sold to third-party private investors or government sponsored agencies and $29.1 million of GNMA optional repurchase loans. This compares to $173.0 million of residential real estate mortgage loans in the process of being sold to third-party private investors or government sponsored agencies and $28.1 million of GNMA optional repurchase loans as of December 31, 2025.
Other earning assets
Securities purchased under agreements to resell ("reverse repurchase agreements")
We enter into agreements with certain customers to purchase investment securities under agreements to resell at specific dates in the future. This investment deploys some of our unused liquidity position into an instrument that improves the return on those funds. Securities purchased under agreements to resell totaled $57.7 million and $45.8 million at September 30, 2026 and December 31, 2025, respectively.
Federal funds sold
Federal funds sold may fluctuate from period to period depending upon our liquidity position at the time and our strategy for deploying liquidity. Federal funds sold totaled $112.7 million and $167.5 million at September 30, 2026 and December 31, 2025, respectively.
AFS debt securities portfolio
Our investment portfolio objectives include maximizing total return after other primary objectives are achieved such as, but not limited to, providing liquidity, capital preservation, and pledging collateral for certain deposit types, various lines of credit and other borrowings. The investment objectives guide the portfolio allocation among security types, maturities, and other attributes.
The fair value of our AFS debt securities portfolio was $1.54 billion and $1.46 billion as of September 30, 2026 and December 31, 2025, respectively. Included in the fair value of AFS debt securities were net unrealized losses of $85.8 million and $47.9 million as of September 30, 2026 and December 31, 2025, respectively. Current net unrealized losses are driven by prevailing interest rate levels versus interest rate levels when many of the bonds were purchased.
During the three and nine months ended September 30, 2026, we purchased $117.6 million and $314.1 million of AFS debt securities, respectively. There were no AFS debt securities sold during the three and nine months ended September 30, 2026. Maturities, prepayments and calls of AFS debt securities totaled $67.4 million and $200.2 million for the three and nine months ended September 30, 2026, respectively.
During the three and nine months ended September 30, 2025, we acquired $31.9 million of AFS debt securities through the merger with Southern States. During the three months ended September 30, 2025, we sold $0.4 million of AFS debt securities. During the same period, maturities, prepayments and calls of AFS debt securities totaled $83.2 million and purchases totaled $132.8 million. During the nine months ended September 30, 2025, we sold $266.9 million of AFS debt securities with a weighted average yield of 1.63%. The securities sold resulted in a net loss on securities of $60.5 million. We used the proceeds from this transaction to redeem outstanding subordinated and trust preferred debt, as well as originate higher yielding loans. During the same period, maturities, prepayments and calls of AFS debt securities totaled $217.9 million and purchases totaled $314.6 million.
The following table sets forth the fair value, scheduled maturities and weighted average yields for our AFS debt securities portfolio as of the dates indicated below:
September 30,
December 31,
2026 2025
(dollars in thousands) Fair value % of total investment securities
Weighted average yield (1)
Fair value % of total investment securities
Weighted average yield (1)
U.S. government agency securities:
Maturing within one year - - % - % - - % - %
Maturing in one to five years - - % - % - - % - %
Maturing in five to ten years 315,721 20.5 % 4.20 % 284,641 19.5 % 4.50 %
Maturing after ten years 474,266 30.8 % 4.20 % 385,447 26.4 % 4.65 %
Total U.S. government agency securities 789,987 51.3 % 4.20 % 670,088 45.9 % 4.59 %
Mortgage-backed securities - residential and commercial:
Maturing within one year - - % - % - - % - %
Maturing in one to five years 2,103 0.1 % 5.22 % 2,192 0.2 % 7.52 %
Maturing in five to ten years 46,871 3.0 % 4.10 % 44,058 3.0 % 4.06 %
Maturing after ten years 538,190 35.1 % 3.74 % 566,748 38.8 % 3.89 %
Total mortgage-backed securities - residential and commercial 587,164 38.2 % 3.77 % 612,998 42.0 % 3.89 %
Municipal securities:
Maturing within one year 640 - % 4.09 % 204 - % 2.81 %
Maturing in one to five years 6,629 0.4 % 3.89 % 5,673 0.4 % 3.82 %
Maturing in five to ten years 44,486 2.9 % 3.40 % 42,493 2.9 % 3.53 %
Maturing after ten years 100,570 6.6 % 3.16 % 120,000 8.2 % 3.03 %
Total municipal securities 152,325 9.9 % 3.26 % 168,370 11.5 % 3.18 %
U.S. Treasury securities:
Maturing within one year - - % - % - - % - %
Maturing in one to five years 6,964 0.5 % 3.73 % 5,803 0.4 % 3.71 %
Maturing in five to ten years - - % - % 1,322 0.1 % 3.81 %
Maturing after ten years - - % - % - - % - %
Total U.S. Treasury securities 6,964 0.5 % 3.73 % 7,125 0.5 % 3.73 %
Corporate securities:
Maturing within one year - - % - % - - % - %
Maturing in one to five years - - % - % 998 0.1 % 6.76 %
Maturing in five to ten years 990 0.1 % 6.93 % - - % - %
Maturing after ten years 700 - % 7.25 % - - % - %
Total corporate securities 1,690 0.1 % 7.06 % 998 0.1 % 6.76 %
Total AFS debt securities $ 1,538,130 100.0 % 3.95 % $ 1,459,579 100.0 % 4.13 %
(1)Yields on a tax-equivalent basis.
Equity securities
As of September 30, 2026 and December 31, 2025, we had $5.8 million and $0.2 million, respectively, in marketable equity securities recorded at fair value that consisted of CRA mutual funds. The change in the fair value of equity securities recorded at fair value resulted in a net loss of $241 thousand and $240 thousand for the three and nine months ended September 30, 2026, respectively. The change in the fair value of equity securities recorded at fair value resulted in a net gain of $12 thousand for both the three and nine months ended September 30, 2025.
Deposits
Deposits represent the Bank's primary source of funding. We continue to focus on growing core customer deposits through our relationship driven banking philosophy, community-focused marketing programs and our treasury management services.
Total deposits increased to $14.67 billion as of September 30, 2026 from $13.91 billion as of December 31, 2025. Noninterest-bearing deposits rose to $2.78 billion from $2.63 billion. Interest-bearing deposits increased to $11.89 billion from $11.28 billion.
Within interest-bearing categories, our checking balances were $2.61 billion and $2.65 billion at September 30, 2026 and December 31, 2025, respectively. Money market and savings balances increased by $305.7 million from December 31, 2025, reflecting our continued focus on core customer deposit growth primarily driven by the addition of several large commercial relationships. Customer time deposits increased by $346.9 million from December 31, 2025 driven by a $150.0 million short-term public funds time deposit and new and existing customer growth into targeted maturity tenors. Brokered and internet time deposits remained stable during the period.
We also experienced a decrease in the cost of interest-bearing deposits, reflecting a lower interest rate environment. Average deposit balances by type, together with the average rates per period are reflected in the average balance sheet amounts, interest paid, and rate analysis tables included in this management's discussion and analysis under the subheading "Results of operations" discussion.
Our deposit base may include certain deposits from related parties as disclosed within Note 16, "Related party transactions" in the notes to our consolidated financial statements included in this Report.
The following table sets forth the distribution by type of our deposit accounts as of the dates indicated:
September 30, December 31,
2026 2025
(dollars in thousands) Amount % of total deposits
Average rate(1)
Amount % of total deposits
Average rate(1)
Deposit Type
Noninterest-bearing demand $ 2,777,111 19 % - % $ 2,634,395 19 % - %
Interest-bearing checking 2,610,941 18 % 1.87 % 2,651,369 19 % 2.31 %
Money market 5,737,253 39 % 3.00 % 5,541,144 40 % 3.39 %
Savings deposits 538,135 4 % 0.86 % 428,496 3 % 0.22 %
Customer time deposits 2,375,869 16 % 3.60 % 2,028,923 15 % 3.71 %
Brokered and internet time deposits 626,687 4 % 4.02 % 625,634 4 % 4.25 %
Total deposits $ 14,665,996 100 % 2.28 % $ 13,909,961 100 % 2.49 %
Customer Time Deposits(2)
0.00-1.00% $ 38,479 2 % $ 81,752 4 %
1.01-2.00% 54,495 2 % 55,299 3 %
2.01-3.00% 253,898 11 % 225,090 11 %
3.01-4.00% 1,758,007 74 % 949,539 47 %
4.01-5.00% 270,990 11 % 716,099 35 %
Above 5.00% - - % 1,144 - %
Total customer time deposits $ 2,375,869 100 % $ 2,028,923 100 %
Brokered and Internet Time Deposits(2)
0.00-1.00% $ - - % $ - - %
1.01-2.00% - - % - - %
2.01-3.00% - - % - - %
3.01-4.00% 571,545 91 % 574,468 92 %
4.01-5.00% 55,142 9 % 51,166 8 %
Above 5.00% - - % - - %
Total brokered and internet time deposits $ 626,687 100 % $ 625,634 100 %
Total time deposits $ 3,002,556 $ 2,654,557
(1) Average rates presented for the nine months ended September 30, 2026 and the year ended December 31, 2025, respectively.
(2) Based on rates presented as of period-end.
Further details related to our deposit customer base are presented below as of the dates indicated:
September 30, December 31,
2026 2025
(dollars in thousands) Amount % of total deposits Amount % of total deposits
Deposits by customer segment(1)
Consumer $ 6,173,567 42 % $ 6,063,015 44 %
Commercial 6,822,469 47 % 6,162,221 44 %
Public 1,669,960 11 % 1,684,725 12 %
Total deposits $ 14,665,996 100 % $ 13,909,961 100 %
(1) Segments are determined based on the customer account level.
The tables below set forth maturity information on time deposits as of September 30, 2026, categorized by balances $250 thousand or less and greater than $250 thousand, exceeding FDIC insurance limits:
(dollars in thousands) Amount Weighted average interest rate at period end
Time deposits of $250 or less
Months to maturity:
Three or less $ 576,779 3.65 %
Over Three to Six 600,058 3.68 %
Over Six to Twelve 296,636 3.32 %
Over Twelve 547,879 3.69 %
Total $ 2,021,352 3.62 %
Time deposits of greater than $250
Months to maturity:
Three or less $ 389,880 3.83 %
Over Three to Six 300,437 3.77 %
Over Six to Twelve 107,300 3.50 %
Over Twelve 183,587 3.74 %
Total $ 981,204 3.76 %
Uninsured deposits are defined as the portion of deposit accounts in U.S. federally insured depository institutions that exceed the FDIC insurance limit and amounts in any other uninsured investment or deposit account that are classified as deposits and are not subject to any federal or state deposit insurance regimes. Collateralized deposits are included within our total uninsured deposits.
Further details related to our estimated insured or collateralized deposits and uninsured and uncollateralized deposits are presented below as of the dates indicated:
September 30, December 31,
2026 2025
Estimated insured or collateralized deposits(1)
$ 10,289,614 $ 9,825,599
Estimated uninsured and uncollateralized deposits(1)
$ 4,376,382 $ 4,084,362
Estimated uninsured and uncollateralized deposits as a % of total deposits(1)
29.8 % 29.4 %
Estimated uninsured deposits(2)
$ 6,059,921 $ 5,777,547
(1) Amounts are shown on a fully consolidated basis and exclude deposits of affiliates that are eliminated in consolidation.
(2) Amounts are shown on an unconsolidated basis consistent with regulatory reporting requirements.
Borrowed funds
Deposits are the primary source of funds for our lending activities and general business purposes. However, we also fund our operations through other channels, including obtaining advances from the FHLB, borrowings from the Federal Reserve's Discount Window or one-off borrowing programs, purchasing federal funds and engaging in overnight borrowing with correspondent banks, or entering into client repurchase agreements. We use these sources of funds as part of our asset liability management process to control our long-term interest rate risk exposure, even if it may increase our short-term cost of funds.
Our level of short-term borrowings fluctuates daily based on funding needs, the sources of funds to meet those needs, and the overall interest rate environment and cost of public funds.
Securities sold under agreements to repurchase and federal funds purchased
We enter into agreements with certain customers to sell certain securities under agreements to repurchase the security the following day. These agreements are made to provide customers with comprehensive treasury management products as a short-term return for their excess funds. Securities sold under agreements to repurchase totaled $7.5 million and $9.9 million at September 30, 2026 and December 31, 2025, respectively.
We also maintain lines with certain correspondent banks that provide borrowing capacity in the form of federal funds purchased. Federal funds purchased are short-term borrowings that typically mature within one to fourteen days. Borrowings against these lines, which are classified as federal funds purchased, totaled $20.0 million and $90.0 million as of September 30, 2026 and December 31, 2025, respectively.
FHLB advances
As a member of the FHLB system, we may utilize advances from the FHLB in order to provide additional liquidity and funding. Under these short-term agreements, we maintain a line of credit that as of September 30, 2026 and December 31, 2025 had total borrowing capacity of $2.31 billion and $2.21 billion, respectively. As of September 30, 2026 and December 31, 2025, we had qualifying loans pledged as collateral securing these lines amounting to $3.90 billion and $3.82 billion, respectively. There were no FHLB advances outstanding as of September 30, 2026 or December 31, 2025.
Subordinated debt
During the year ended December 31, 2025, we redeemed $30.9 million of junior subordinated debentures and $100.0 million of ten-year fixed-to-floating rate subordinated notes at the principal amount plus accrued interest, in accordance with the terms of the notes.
On July 1, 2025, we assumed three separate fixed-to-floating rate subordinated notes in connection with our merger with Southern States with a principal balance totaling $92.5 million.
During September 2026, we issued $125.0 million aggregate principal amount of 6.625% fixed-to-floating rate subordinated notes.
Further details regarding our subordinated debt as of September 30, 2026 are provided below.
(dollars in thousands) Year established Maturity Call date Total debt outstanding Interest rate Coupon structure
October 2036 Subordinated Debt(1)
2026 10/01/2036 10/01/2031 $ 125,000 6.625%
Semiannual fixed(2)
February 2032 Subordinated Debt(1)(3)
2022 02/07/2032 03/30/2027 47,500 3.50%
Quarterly fixed(2)
October 2032 Subordinated Debt(1)(3)
2022 10/26/2032
12/30/2027
40,000 7.00%
Quarterly fixed(2)
December 2031 Subordinated Debt(1)(3)
2021 12/22/2031
12/31/2026
5,000 3.50%
Quarterly fixed(2)
Unamortized debt issuance costs and unamortized fair value marks (9,778)
Total subordinated debt, net $ 207,722
(1) We classify the subordinated debt, net of applicable unamortized debt issuance costs and fair value marks on acquired debt, as Tier 2 capital, subject to a 20% annual
phaseout during the final five years before maturity
(2) Beginning on each respective call date, the coupon rate converts to 3M SOFR plus a spread of 205 basis points, 205 basis points, 306 basis points and 242 basis points
for the October 2036, February 2032, October 2032 and December 2031 subordinated issues, respectively, through the end of the term of each debenture.
(3) These notes were acquired in the Southern States merger on July 1, 2025.
Other borrowings
Other borrowings include our finance lease liability totaling $1.1 million as of both September 30, 2026 and December 31, 2025. Additionally, other borrowings include optional rights to repurchase GNMA loans previously sold that meet certain defined delinquency criteria and are eligible for repurchase totaling $29.1 million and $28.1 million as of September 30, 2026 and December 31, 2025, respectively. See Note 6, "Leases" and Note 12, "Fair value of financial instruments" within the notes to our consolidated financial statements herein for additional information regarding our finance lease and optional rights to repurchase GNMA loans, respectively.
Other borrowings may periodically include borrowings from the Federal Reserve's Discount Window or other borrowing programs available to us as an additional source of short-term liquidity. As of September 30, 2026 and December 31, 2025, there were no such other borrowings outstanding. Under our Borrower-in-Custody arrangement, we are permitted to pledge qualifying loans as collateral while retaining possession of the loan documentation. As of September 30, 2026 and December 31, 2025, we had pledged loan collateral totaling $2.70 billion and $2.88 billion, respectively, to the Federal Reserve under the Borrower-in-Custody program, resulting in total borrowing capacity of $2.07 billion and $2.27 billion, respectively.
Liquidity and capital resources
We are expected to maintain adequate liquidity at the Bank to meet the cash flow requirements of clients who may be either depositors wishing to withdraw funds or borrowers needing assurance that sufficient funds will be available to meet their credit needs. Our Liquidity Policy is intended to cause the Bank to maintain adequate liquidity and, therefore, enhance our ability to raise funds to support asset growth, meet deposit withdrawals and lending needs and otherwise sustain our operations. We accomplish this through management of the maturities of our interest-earning assets and interest-bearing liabilities. We believe that our present position is adequate to meet our current and future liquidity needs.
We continuously monitor our liquidity position to ensure that assets and liabilities are managed in a manner that will meet all of our short-term and long-term cash requirements. We manage our liquidity position to meet the daily cash flow needs of clients, while maintaining an appropriate balance between assets and liabilities to optimize our net interest margin. We also monitor our liquidity requirements in light of interest rate trends, changes in the economy and the scheduled maturity and interest rate sensitivity of the investment and loan portfolios and deposits.
As part of our liquidity management strategy, we focus on minimizing our costs of liquidity and attempt to decrease these costs by growing our noninterest-bearing and other low-cost deposits, while replacing higher cost funding sources. While we do not control the types of deposit instruments our clients choose, we do influence those choices with the rates and the deposit specials we offer. Increasing interest rates generally attracts customers to higher cost interest-bearing deposit products as they seek to maximize their yield.
Our investment portfolio is another alternative for meeting liquidity needs. These assets generally have readily available markets that offer conversions to cash as needed. AFS debt securities within our investment portfolio are typically used to secure government, public, trust and other deposits and as collateral for short-term borrowings, letters of credit and derivative instruments. As of September 30, 2026 and December 31, 2025, we had pledged securities with carrying values of $806.6 million and $810.6 million, respectively.
Additional sources of liquidity include federal funds purchased, repurchase agreements, FHLB borrowings, Federal Reserve Discount Window borrowings and lines of credit. Interest is charged at the prevailing market rate on federal funds purchased, repurchase agreements and FHLB advances, and at the Federal Reserve's primary credit rate for Discount Window borrowings.
Overnight advances obtained from the FHLB are used primarily to meet day to day liquidity needs, particularly when the cost of such borrowing compares favorably to the rates that we would be required to pay to attract deposits. There were no FHLB advances outstanding as of September 30, 2026 or December 31, 2025. As of September 30, 2026 and December 31, 2025, we had the ability to borrow $2.31 billion and $2.21 billion, respectively, of which $2.29 billion and $2.21 billion, respectively, remained available.
Short-term borrowings from the Federal Reserve's Discount Window serve as an additional contingent source of liquidity. We access the Discount Window through our Borrower-in-Custody collateral arrangement, which permits the Bank to pledge qualifying loans while retaining custody of the underlying loan documentation. There were no Federal Reserve Discount Window borrowings outstanding as of September 30, 2026 or December 31, 2025. As of September 30, 2026 and December 31, 2025, we had borrowing capacity of $2.07 billion and $2.27 billion, respectively, under the Discount Window Borrower-in-Custody program, all of which remained available.
We also maintained unsecured lines of credit with other commercial banks totaling $405.0 million as of both September 30, 2026 and December 31, 2025. These are unsecured, uncommitted lines of credit typically maturing at various times within the next twelve months. Borrowings against these lines, which are classified as federal funds purchased, totaled $20.0 million and $90.0 million as of September 30, 2026 and December 31, 2025, respectively. As of both September 30, 2026 and December 31, 2025, we also had $50.0 million available through the IntraFi network, which allows us to offer banking customers access to FDIC insurance protection on deposits through our Bank which exceed FDIC insurance limits.
Our current on-balance sheet liquidity and available sources of liquidity are summarized in the table below:
September 30, December 31,
(dollars in thousands) 2026 2025
Current on-balance sheet liquidity:
Cash and cash equivalents $ 1,017,689 $ 1,155,895
Unpledged AFS debt securities 731,483 649,000
Equity securities, at fair value 5,759 155
Total on-balance sheet liquidity $ 1,754,931 $ 1,805,050
Available sources of liquidity:
Unsecured borrowing capacity(1)
$ 4,210,357 $ 3,915,314
FHLB remaining borrowing capacity 2,290,109 2,214,796
Federal Reserve discount window 2,070,119 2,268,599
Total available sources of liquidity $ 8,570,585 $ 8,398,709
On-balance sheet liquidity as a percentage of total assets 10.3 % 11.1 %
On-balance sheet liquidity and available sources of liquidity as a percentage of estimated
uninsured and uncollateralized deposits(2)
235.9 % 249.8 %
(1)Includes capacity available per internal policy in the form of brokered deposits and unsecured lines of credit.
(2)Amounts are shown on a fully consolidated basis and exclude deposits of affiliates that are eliminated in consolidation.
The Company also maintains the ability to access capital markets to meet its liquidity needs. The Company may utilize various methods to raise capital, including through the sale of common stock, preferred stock, debt securities, warrants, rights, or other securities. Specific terms and prices would be determined at the time of any such offering. In the past, the Company has utilized capital markets to generate liquidity in the form of common stock and subordinated debt primarily for the purpose of funding acquisitions.
The Company is a corporation separate and apart from the Bank and, therefore, it must provide for its own liquidity. The Company's main source of funding is dividends declared and paid by the Bank to the Company. Statutory and regulatory limitations exist that affect the ability of the Bank to pay dividends to the Company. Management believes that these limitations will not impact the Company's ability to meet its ongoing short-term cash obligations. For additional information regarding dividend restrictions, see the "Item 1. Business - Supervision and regulation," "Item 1A. Risk Factors - Risks related to our business" and "Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities - Dividends," each of which is set forth in our Annual Report on Form 10-K for the year ended December 31, 2025.
Due to state banking laws and the Federal Reserve's Regulation H, the Bank may not declare dividends in any calendar year in an amount exceeding the total of its net income for that year combined with its retained net income of the preceding two years, without the prior approval of the TDFI and/or Federal Reserve. In addition, dividends paid by the Bank to the Company would be prohibited if the effect thereof would cause the Bank's capital to be reduced below applicable minimum capital requirements. Dividends paid by the Bank to the holding company were made in accordance with applicable state banking laws and the Federal Reserve's Regulation H. During the three and nine months ended September 30, 2026, there were $39.3 million and $165.7 million in cash dividends approved by the board for payment from the Bank to the holding company. During the three and nine months ended September 30, 2025, there were $40.7 million and $102.8 million in cash dividends approved by the board for payment from the Bank to the holding company. Subsequent to September 30, 2026, the Board approved an additional dividend of $115.2 million to be paid during the fourth quarter of 2026. In addition, during the three and nine months ended September 30, 2026, the Company contributed to the Bank $123.3 million of the proceeds from its issuance of subordinated notes, net of the underwriting discount, as a capital contribution.
During the three and nine months ended September 30, 2026, the Company declared shareholder dividends of $0.21 per share, or $10.6 million and $0.63 per share, or $32.6 million, respectively. During the three and nine months ended September 30, 2025, the Company declared shareholder dividends of $0.19 per share, or $10.3 million and $0.57 per share, or $28.0 million, respectively. Subsequent to September 30, 2026, the Company declared a quarterly dividend in the amount of $0.21 per share, payable on November 24, 2026, to shareholders of record as of November 10, 2026.
Shareholders' equity and capital management
Our total shareholders' equity was $1.93 billion and $1.95 billion as of September 30, 2026 and December 31, 2025, respectively. The decrease in shareholders' equity was primarily attributable to stock repurchases of $135.3 million, dividends declared of $32.6 million and other comprehensive loss of $28.2 million. This decrease was partially offset by net income of $176.4 million. Book value per common share was $39.11 as of September 30, 2026 and $37.64 as of December 31, 2025.
Our capital management consists of providing adequate equity to support our current and future operations. We are subject to various regulatory capital requirements administered by state and federal banking agencies, including the TDFI, Federal Reserve and the FDIC. Failure to meet minimum capital requirements may prompt certain actions by regulators that, if undertaken, could have a direct material adverse effect on our financial condition and results of operations. The Federal Reserve and the FDIC have issued guidelines governing the levels of capital that banks must maintain. As of September 30, 2026 and December 31, 2025, we met all capital adequacy requirements to which we were subject. See additional discussion regarding our capital adequacy and ratios within Note 14, "Minimum capital requirements" in the notes to our consolidated financial statements contained herein.
September 30, 2026 FB Financial Corporation FirstBank
To be Well-Capitalized(1)
Total risk-based capital ratio 13.6 % 13.3 % 10.0 %
Tier 1 risk-based capital ratio 11.0 % 12.0 % 8.0 %
Common equity tier 1 ratio 11.0 % 12.0 % 6.5 %
Tier 1 leverage ratio 10.0 % 11.0 % 5.0 %
(1) Applicable to Bank level capital.
Capital ratios are well above regulatory requirements for well-capitalized institutions. Management uses risk-based capital ratios in its analysis of the measures to assess the quality of capital and believes that investors may find it useful in their analysis of the Company.
FB Financial Corporation published this content on November 02, 2026, and is solely responsible for the information contained herein. Distributed via EDGAR on November 02, 2026 at 20:06 UTC. If you believe the information included in the content is inaccurate or outdated and requires editing or removal, please contact us at [email protected]