FB Financial Corporation

11/07/2025 | Press release | Distributed by Public on 11/07/2025 13:57

Quarterly Report for Quarter Ending September 30, 2025 (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, 2025 and December 31, 2024, and our results of operations for the three and nine months ended September 30, 2025 and 2024, 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, 2024, that was filed with the SEC on February 25, 2025, 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. These forward-looking statements include, without limitation, statements regarding the Company's future plans, results, strategies, and expectations, including expectations around changing economic markets and statements regarding the merger of Southern States Bancshares, Inc. ("Southern States") with the Company (the "Merger") and expectations with regard to the benefits of the Merger. 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 US 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, and mortgage operations, (3) increased competition for deposits, (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, or the impact of interest rates on the value of our investment securities portfolio, (5) any deterioration in commercial real estate market fundamentals, (6) risks associated with the Merger, including (a) the risk that the cost savings and any revenue synergies from the Merger is less than or different from expectations, (b) disruption from the Merger with customer, supplier, or employee relationships,(c) the possibility that the costs, fees, expenses and charges related to the Merger may be greater than anticipated, including as a result of unexpected or unknown factors, events, or liabilities, (d) the risks related to the integration of the combined businesses, including the risk that the integration will be materially delayed or will be more costly or difficult than expected, (e) the diversion of management time on merger-related issues, (f) the ability of the Company to effectively manage the larger and more complex operations of the combined company following the Merger, (g) the risk of expansion into new geographic or product markets, (h) reputational risk and the reaction of the parties' customers to the Merger, (i) the Company's ability to successfully execute its various business strategies, including its ability to execute on potential acquisition opportunities, and (j) the risk of potential litigation or regulatory action related to the Merger, (7) the Company's ability to identify potential candidates for, consummate, and achieve synergies from, other potential future acquisitions, (8) the Company's ability to manage any unexpected outflows of uninsured deposits and avoid selling investment securities or other assets at an unfavorable time or at a loss, (9) the Company's ability to successfully execute its various business strategies, (10) changes in state and federal legislation, regulations or policies applicable to banks and other financial service providers, including legislative developments, (11) 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, (12) the Company's dependence on information technology systems of third party service providers and the risk of systems failures, interruptions, or breaches of security, (13) the impact, extent and timing of technological changes, (14) concentrations of credit or deposit exposure, (15) the impact of natural disasters, pandemics, acts of war or terrorism, or other catastrophic events, (16) events giving rise to international or regional political instability, including the broader impacts of such events on financial markets and/or global macroeconomic environments, and/or (17) 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, 2024, 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 consolidated financial statements are prepared in accordance with U.S. generally accepted accounting principles and general practices within the banking industry. A summary of our accounting policies is included in "Item 8. Financial Statements and Supplementary Data - Note 1, Basis of presentation and summary of significant accounting policies" of our Annual Report on Form 10-K for the year ended December 31, 2024. Any material updates to these policies since the Annual Report are described in Note 1, "Basis of presentation," within this Report. Certain of these policies require management to apply significant judgment and estimates, which can have a material impact on the carrying value of certain assets and liabilities.
Business combinations
We account for mergers and acquisitions using the acquisition method, which requires identifiable assets acquired and liabilities assumed to be recorded at fair value. Fair value determinations involve significant judgment and are based on valuation methodologies that incorporate management's assumptions regarding future cash flows, discount rates, balance attrition, and other relevant factor. We engaged with third-party specialists to assist in developing these estimates, particularly when observable market inputs are limited. Use of different assumptions could have a significant impact on the fair value of assets acquired and liabilities assumed and on our overall financial results.
For additional information regarding critical accounting estimates, refer to "Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations - Critical accounting estimates" of our Annual Report on Form 10-K for the year ended December 31, 2024.
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) 2025 2024 2025 2024 2024
Selected Balance Sheet Data
Cash and cash equivalents $ 1,280,033 $ 951,750 $ 1,280,033 $ 951,750 $ 1,042,488
Investment securities, at fair value 1,428,401 1,567,922 1,428,401 1,567,922 1,538,008
Loans held for sale 167,449 103,145 167,449 103,145 126,760
Loans HFI 12,297,600 9,478,129 12,297,600 9,478,129 9,602,384
Allowance for credit losses on loans HFI (184,993) (156,260) (184,993) (156,260) (151,942)
Total assets 16,236,459 12,920,222 16,236,459 12,920,222 13,157,482
Interest-bearing deposits (non-brokered) 10,634,555 8,230,867 10,634,555 8,230,867 8,625,113
Brokered deposits 487,765 519,200 487,765 519,200 469,089
Noninterest-bearing deposits 2,690,635 2,226,144 2,690,635 2,226,144 2,116,232
Total deposits 13,812,955 10,976,211 13,812,955 10,976,211 11,210,434
Borrowings 213,638 182,107 213,638 182,107 176,789
Allowance for credit losses on unfunded
commitments 		17,392 6,042 17,392 6,042 6,107
Total common shareholders' equity 1,978,043 1,562,329 1,978,043 1,562,329 1,567,538
Selected Statement of Income Data
Total interest income $ 236,898 $ 185,628 $ 598,688 $ 539,169 $ 725,538
Total interest expense 89,658 79,611 232,392 231,047 309,035
Net interest income 147,240 106,017 366,296 308,122 416,503
Provisions for credit losses 34,417 1,914 42,046 4,920 12,004
Total noninterest income (loss) 26,635 (16,497) 15,115 17,073 39,070
Total noninterest expense 109,856 76,212 270,666 223,725 296,899
Income before income taxes 29,602 11,394 68,699 96,550 146,670
Income tax expense 6,227 1,174 3,046 18,393 30,619
Net income applicable to noncontrolling
interest 		- - 8 8 16
Net income applicable to FB Financial
Corporation 		$ 23,375 $ 10,220 $ 65,645 $ 78,149 $ 116,035
Net interest income (tax-equivalent basis) $ 148,088 $ 106,634 $ 368,751 $ 310,087 $ 419,091
Per Common Share
Basic net income $ 0.44 $ 0.22 $ 1.35 $ 1.67 $ 2.48
Diluted net income 0.43 0.22 1.34 1.67 2.48
Book value 37.00 33.48 37.00 33.48 33.59
Tangible book value(1)
29.83 28.15 29.83 28.15 28.27
Cash dividends declared 0.19 0.17 0.57 0.51 0.68
Selected Ratios
Return on average:
Assets 0.58 % 0.32 % 0.62 % 0.83 % 0.91 %
Common shareholders' equity 4.69 % 2.67 % 5.11 % 7.02 % 7.71 %
Tangible common equity(1)
5.82 % 3.19 % 6.17 % 8.45 % 9.24 %
Efficiency ratio 63.2 % 85.1 % 71.0 % 68.8 % 65.2 %
Core efficiency ratio (tax-equivalent basis)(1)
53.3 % 58.4 % 56.4 % 58.2 % 57.3 %
Loans HFI to deposit ratio 89.0 % 86.4 % 89.0 % 86.4 % 85.7 %
Noninterest-bearing deposits to total deposits 19.5 % 20.3 % 19.5 % 20.3 % 18.9 %
Net interest margin (tax-equivalent basis) 3.95 % 3.55 % 3.74 % 3.51 % 3.51 %
Yield on interest-earning assets 6.35 % 6.20 % 6.10 % 6.13 % 6.10 %
Cost of interest-bearing liabilities 3.21 % 3.63 % 3.17 % 3.58 % 3.53 %
Cost of total deposits 2.53 % 2.83 % 2.52 % 2.79 % 2.76 %
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,
2025 2024 2025 2024 2024
Credit Quality Ratios
Allowance for credit losses on loans HFI as a
percentage of loans HFI 		1.50 % 1.65 % 1.50 % 1.65 % 1.58 %
Annualized net charge-offs as a percentage
of average loans HFI 		(0.05) % (0.03) % (0.07) % (0.02) % (0.14) %
Nonperforming loans HFI as a percentage of
loans HFI 		0.94 % 0.96 % 0.94 % 0.96 % 0.87 %
Nonperforming assets as a percentage of
total assets(2)
0.89 % 0.99 % 0.89 % 0.99 % 0.93 %
Capital Ratios (Company)
Total common shareholders' equity to assets 12.2 % 12.1 % 12.2 % 12.1 % 11.9 %
Tangible common equity to tangible assets(1)
10.1 % 10.4 % 10.1 % 10.4 % 10.2 %
Tier 1 leverage 10.6 % 11.5 % 10.6 % 11.5 % 11.3 %
Tier 1 risk-based capital 11.7 % 13.0 % 11.7 % 13.0 % 13.1 %
Total risk-based capital 13.6 % 15.1 % 13.6 % 15.1 % 15.2 %
Common Equity Tier 1 11.7 % 12.7 % 11.7 % 12.7 % 12.8 %
(1)Non-GAAP financial measure; See "GAAP reconciliation and management explanation of non-GAAP financial measures" and non-GAAP reconciliations herein.
(2)Includes $21.7 million, $30.5 million and $31.4 million of optional rights to repurchase delinquent GNMA loans as of September 30, 2025, September 30, 2024 and December 31, 2024, 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. The non-GAAP financial measures that we discuss in this Report should not be considered in isolation or as a substitute for the most directly comparable or other financial measures calculated in accordance with GAAP. Moreover, the manner in which we calculate the non-GAAP financial measures that we discuss in our selected historical consolidated financial data may differ from that of other companies reporting measures with similar names. You should understand how such other banking organizations calculate their financial measures similar or with names similar to the non-GAAP financial measures we have discussed in our selected historical consolidated financial data when comparing such non-GAAP financial measures. The following reconciliation tables provide a more detailed analysis of these, and reconciliation for, each of non-GAAP financial measures.
Core efficiency ratio (tax-equivalent basis)
The core 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 core 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,
2025 2024 2025 2024 2024
Core efficiency ratio (tax-equivalent basis)
Total noninterest expense $ 109,856 $ 76,212 $ 270,666 $ 223,725 $ 296,899
Less early retirement and severance costs - - - 1,015 1,478
Less loss on lease terminations and other
branch closure costs 		270 - 270 - -
Less FDIC special assessment - - - 500 500
Less merger and integration costs 16,057 - 19,192 - -
Core noninterest expense $ 93,529 $ 76,212 $ 251,204 $ 222,210 $ 294,921
Net interest income $ 147,240 $ 106,017 $ 366,296 $ 308,122 $ 416,503
Net interest income (tax-equivalent basis) 148,088 106,634 368,751 310,087 419,091
Total noninterest income (loss) 26,635 (16,497) 15,115 17,073 39,070
Less gain (loss) from securities, net 12 (40,165) (60,521) (56,378) (56,378)
Less loss on sales or write-downs of
other real estate owned and other assets 		(646) (289) (1,035) (5) (2,167)
Less cash life insurance benefit - - - 2,057 2,057
Core noninterest income $ 27,269 $ 23,957 $ 76,671 $ 71,399 $ 95,558
Total revenue $ 173,875 $ 89,520 $ 381,411 $ 325,195 $ 455,573
Core revenue (tax-equivalent basis) $ 175,357 $ 130,591 $ 445,422 $ 381,486 $ 514,649
Efficiency ratio 63.2 % 85.1 % 71.0 % 68.8 % 65.2 %
Core efficiency ratio (tax-equivalent basis) 53.3 % 58.4 % 56.4 % 58.2 % 57.3 %
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 measure calculated in accordance with GAAP is book value per common share and our total 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 common equity to tangible assets compared to total common shareholders' equity to total assets:
September 30,
December 31,
(dollars in thousands, except share data) 2025 2024 2024
Tangible assets
Total assets $ 16,236,459 $ 12,920,222 $ 13,157,482
Adjustments:
Goodwill (350,353) (242,561) (242,561)
Intangibles, net (33,216) (6,449) (5,762)
Tangible assets $ 15,852,890 $ 12,671,212 $ 12,909,159
Tangible common equity
Total common shareholders' equity $ 1,978,043 $ 1,562,329 $ 1,567,538
Adjustments:
Goodwill (350,353) (242,561) (242,561)
Intangibles, net (33,216) (6,449) (5,762)
Tangible common equity $ 1,594,474 $ 1,313,319 $ 1,319,215
Common shares outstanding 53,456,522 46,658,019 46,663,120
Book value per common share $ 37.00 $ 33.48 $ 33.59
Tangible book value per common share $ 29.83 $ 28.15 $ 28.27
Total common shareholders' equity to total assets 12.2 % 12.1 % 11.9 %
Tangible common equity to tangible assets 10.1 % 10.4 % 10.2 %
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, as of the dates 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) 2025 2024 2025 2024 2024
Return on average tangible common equity
Total average common shareholders' equity $ 1,977,785 $ 1,523,597 $ 1,716,391 $ 1,486,010 $ 1,505,739
Adjustments:
Average goodwill (350,355) (242,561) (278,887) (242,561) (242,561)
Average intangibles, net (34,983) (6,795) (15,175) (7,536) (7,177)
Average tangible common equity $ 1,592,447 $ 1,274,241 $ 1,422,329 $ 1,235,913 $ 1,256,001
Net income applicable to FB Financial
Corporation 		$ 23,375 $ 10,220 $ 65,645 $ 78,149 $ 116,035
Return on average common shareholders'
equity 		4.69 % 2.67 % 5.11 % 7.02 % 7.71 %
Return on average tangible common equity 5.82 % 3.19 % 6.17 % 8.45 % 9.24 %
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, 2025, our footprint included 91 full-service branches serving markets across Tennessee, including Nashville, Chattanooga, Knoxville, Memphis, and Jackson in addition to Bowling Green, Kentucky, Columbus and Newnan, Georgia and Birmingham, Anniston, Huntsville, and Auburn, Alabama. Additionally, our banking services extend to community markets throughout our footprint. FirstBank also provides retail mortgage banking services utilizing its bank branch network and mortgage banking offices strategically located throughout the southeastern United States.
We operate through two segments, Banking and Mortgage. We generate most of our revenue in our Banking segment from interest on loans and investments, loan-related fees, trust and investment services and deposit-related fees. Our primary source of funding for our loans is customer deposits, however we have other sources of funds including unsecured credit lines, brokered CDs, and other borrowings. We generate most of our revenue in our Mortgage segment from origination fees and gains on sales in the secondary mortgage loan market, as well as from mortgage servicing revenues.
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 strengthens the Company's presence in existing markets, such as Birmingham and Huntsville, Alabama, while expanding the Company's footprint further into Alabama and Georgia. The Company acquired total assets of $2.83 billion, total loans of $2.27 billion and assumed total deposits of $2.47 billion. Under the terms of the agreement, each outstanding share of Southern States common stock was converted into the right to receive 0.80 shares of the Company's stock. Additionally, fractional shares and outstanding stock options were settled in cash. As a result, total consideration paid was $368.4 million based on the Company's closing stock price of $45.30 per share on June 30, 2025. The merger resulted in additional goodwill of $107.8 million being recorded based on preliminary fair value estimates of total net assets acquired and liabilities assumed in the transaction.
Overview of recent financial performance
Results of operations
Three months ended September 30, 2025 compared to three months ended September 30, 2024
We recognized net income of $23.4 million during the three months ended September 30, 2025 compared to $10.2 million for the three months ended September 30, 2024. Diluted earnings per common share were $0.43 and $0.22 for the three months ended September 30, 2025 and 2024, respectively. Our net income represented a ROAA of 0.58% and 0.32% for the three months ended September 30, 2025 and 2024, respectively, and a ROAE of 4.69% and 2.67% for the same periods. Our ROATCE for the three months ended September 30, 2025 and 2024 were 5.82% and 3.19%, 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 $147.2 million for the three months ended September 30, 2025 compared with $106.0 million for the three months ended September 30, 2024. Our net interest margin, on a tax-equivalent basis, increased to 3.95% for the three months ended September 30, 2025 as compared to 3.55% for the three months ended September 30, 2024. Net interest income for the three months ended September 30, 2025 reflected increases in average balances on loans HFI primarily as a result of the merger with Southern States and decreases in rates paid on interest-bearing deposits.
Provision for credit losses of $34.4 million was recognized for the three months ended September 30, 2025 and $1.9 million for the three months ended September 30, 2024. The increase 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 and changes in loan balances and forecast assumptions. Refer to Note 2, "Mergers and acquisitions" in this Report for further discussion around the merger with Southern States.
Noninterest income for the three months ended September 30, 2025 increased by $43.1 million to income of $26.6 million, compared to a loss of $16.5 million for the three months ended September 30, 2024. The increase was primarily driven by the recognition of a $40.2 million net loss on investment securities stemming from the sale of $318.5 million AFS debt securities during the three months ended September 30, 2024. Refer to the section "Other earning assets" for additional information on the sale of the AFS debt securities.
Noninterest expense increased to $109.9 million for the three months ended September 30, 2025, compared with $76.2 million for the three months ended September 30, 2024. The increase in noninterest expense was driven by a $11.7 million increase in salaries, commissions and employee benefits due to increased headcount resulting from the Southern States merger, combined with increase in performance-based compensation driven by improvement in the Company's performance metrics, $16.1 million in merger and integration costs associated with our merger with Southern States and an increase in other noninterest expense of $3.9 million.
Income tax expense for the three months ended September 30, 2025 was $6.2 million compared to $1.2 million for the three months ended September 30, 2024. The change reflects the income tax effect of a $40.2 million loss on sale of AFS debt securities for the three months ended September 30, 2024.
Nine months ended September 30, 2025 compared to the nine months ended September 30, 2024
Our net income decreased during the nine months ended September 30, 2025 to $65.7 million from $78.2 million for the nine months ended September 30, 2024. Diluted earnings per common share was $1.34 and $1.67 for the nine months ended September 30, 2025 and 2024, respectively. Our net income represented a ROAA of 0.62% and 0.83% for the nine months ended September 30, 2025 and 2024, respectively, and a ROAE of 5.11% and 7.02% for the same periods. Our ratio of ROATCE for the nine months ended September 30, 2025 and 2024 was 6.17% and 8.45%, respectively.
During the nine months ended September 30, 2025, our net interest income increased to $366.3 million from $308.1 million for the nine months ended September 30, 2024. Our net interest margin, on a tax-equivalent basis, increased to 3.74% for the nine months ended September 30, 2025 as compared to 3.51% for the nine months ended September 30, 2024. The increase in net interest margin was primarily driven by increases in interest income on loans HFI primarily due to the merger with Southern States and investment securities, partially offset by increases in interest expense paid on interest-bearing deposits and other borrowings.
Provision for credit losses of $42.0 million was recognized for the nine months ended September 30, 2025 and $4.9 million for the nine months ended September 30, 2024. The increase 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 and regular changes in loan balances and forecast inputs.
Noninterest income for the nine months ended September 30, 2025 decreased by $2.0 million to $15.1 million, compared to $17.1 million for the prior year period. The decrease in noninterest income was primarily driven by the recognition of a $60.5 million net loss on investment securities stemming from the sale of $266.9 million of AFS debt securities during the nine months ended September 30, 2025 compared to a net loss of $56.4 million from the sale of $526.4 million of AFS debt securities during the nine months ended September 30, 2024. Refer to the section "Other earning assets" for additional information on the sale of the AFS debt securities.
Noninterest expense increased to $270.7 million for the nine months ended September 30, 2025, compared with $223.7 million for the nine months ended September 30, 2024. The increase in noninterest expense was reflective of an increase in merger and integration costs of $19.2 million, salaries, commissions and benefits of $15.8 million, advertising expense of $2.1 million and other expense of $7.8 million including technology and platform fee increases and modest increases across a range of other expense categories.
Income tax expense for the nine months ended September 30, 2025 was $3.0 million compared to $18.4 million for the nine months ended September 30, 2024. The change reflects the income tax effect of a $60.5 million loss on sale of AFS debt securities, as well as a one-time 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 for the nine months ended September 30, 2025. Income tax expense for the nine months ended September 30, 2024, included the income tax effect of a $56.4 million loss on sale of AFS debt securities.
Business segment highlights
We operate our business in two business segments: Banking and Mortgage. See Note 14, "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, 2025 compared to three months ended September 30, 2024
The Banking segment contributed $26.9 million of income before taxes for the current period as compared to $11.0 million for the previous period. Net interest income totaled $144.9 million during the three months ended September 30, 2025 compared to $104.3 million during the previous period. Provisions for credit losses on loans HFI and unfunded loan commitments resulted in $34.1 million of provision expense during the current period as compared to $1.9 million during the previous period. The increase 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. The Banking segment recorded noninterest income of $13.1 million in the current period as compared to a loss of $28.4 million in the previous period. This increase was mainly attributable to a net loss on investment securities of $40.2 million from the sale of $318.5 million AFS debt securities during the three months ended September 30, 2024. Noninterest expense increased to $97.0 million for the
current period compared to $63.1 million for the for the previous period primarily due to merger and integration costs associated with our merger with Southern States and salaries, commissions and employee benefits expenses. Additionally, we recognized modest increases across a range of other expense categories. Additionally, a franchise tax benefit was recognized in the previous period.
Nine months ended September 30, 2025 compared to the nine months ended September 30, 2024
The Banking segment contributed $67.5 million of income before taxes for the current period as compared to $93.7 million for the previous period. Net interest income totaled $359.5 million during the nine months ended September 30, 2025 compared to $304.0 million during the previous period. Provisions for credit losses on loans HFI and unfunded loan commitments resulted in $36.8 million of provision expense during the current period as compared to $5.1 million during the previous period. As noted above, the increase 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. The Banking segment recorded noninterest loss of $24.0 million in the current period as compared to income of $19.7 million in the previous period. Similar to above, this decrease was mainly attributable to a net loss on investment securities of $60.5 million from the sale of $266.9 million AFS debt securities during the nine months ended September 30, 2025 compared to a net loss on investment securities of $56.4 million from the sale of $526.4 million AFS debt securities during the previous period. Noninterest expense increased to $231.2 million for the current period compared to $185.5 million for the for the previous period due primarily to an increase in salaries and benefits, merger and integration costs associated with the Southern States merger, advertising, technology and platform fees and modest increases across a range of other expense categories. Additionally, a franchise tax benefit was recognized in the previous period.
Mortgage
Three months ended September 30, 2025 compared to three months ended September 30, 2024
Activity in our Mortgage segment resulted in income before income taxes of $2.7 million for the current period, as compared to $0.4 million in the prior period. Net interest income was $2.4 million for the current period and $1.7 million for the prior period. Provisions for credit losses on loans HFI and unfunded loan commitments resulted in provision expense of $0.3 million during the current period compared to $0.1 million during the prior period. Mortgage banking income increased $1.9 million to $13.5 million during the current period compared to $11.6 million in the prior period.
The components of mortgage banking income for the three months ended September 30, 2025 and 2024 were as follows:
Three Months Ended September 30,
(dollars in thousands) 2025 2024
Mortgage banking income
Gains and fees from origination and sale of mortgage
loans held for sale 		$ 9,237 $ 9,279
Net change in fair value of loans held for sale and derivatives 801 (480)
Change in fair value on MSRs, net of hedging (3,390) (4,490)
Mortgage servicing income 6,836 7,244
Total mortgage banking income $ 13,484 $ 11,553
Interest rate lock commitment volume $ 432,149 $ 381,240
Interest rate lock commitment volume by purpose (%):
Purchase 79.2 % 82.5 %
Refinance 20.8 % 17.5 %
Mortgage sales $ 343,450 $ 327,270
Mortgage sale margin 2.69 % 2.84 %
Closing volume $ 370,287 $ 317,502
Outstanding principal balance of mortgage loans serviced $ 9,716,824 $ 10,402,118
Noninterest expense for the three months ended September 30, 2025 and 2024 was $12.9 million and $13.1 million, respectively.
Nine months ended September 30, 2025 compared to the nine months ended September 30, 2024
Activity in our Mortgage segment resulted income before income taxes of $1.2 million for the current period, as compared to $2.9 million of income before taxes in the prior period. Net interest income was $6.8 million for the current period and $4.1 million for the prior period. Provisions for credit losses on loans HFI and unfunded loan commitments resulted in provision expense of $5.2 million during the current period compared to a reversal of $0.2 million of provision expense during the prior period. The increase in provisions for credit losses was due to a change in the CECL loss estimation methodology, which notably impacted the Company's reserves on 100% financed 1-to-4 mortgages, as well as a notable change in forecasts associated with home prices which impacted mortgage reserves more broadly. Mortgage banking income increased $2.9 million to $38.9 million during the current period compared to $36.0 million in the prior period.
The components of mortgage banking income for the nine months ended September 30, 2025 and 2024 were as follows:
Nine Months Ended September 30,
(dollars in thousands) 2025 2024
Mortgage banking income
Gains and fees from origination and sale of mortgage
loans held for sale 		$ 26,039 $ 24,671
Net change in fair value of loans held for sale and derivatives 2,741 1,337
Change in fair value on MSRs, net of hedging (10,690) (11,867)
Mortgage servicing income 20,849 21,907
Total mortgage banking income $ 38,939 $ 36,048
Interest rate lock commitment volume $ 1,270,646 $ 1,143,603
Interest rate lock commitment volume by purpose (%):
Purchase 84.4 % 84.8 %
Refinance 15.6 % 15.2 %
Mortgage sales $ 957,316 $ 885,775
Mortgage sale margin 2.72 % 2.79 %
Closing volume $ 1,012,802 $ 913,315
Outstanding principal balance of mortgage loans serviced $ 9,716,824 $ 10,402,118
Noninterest expense for the nine months ended September 30, 2025 and 2024 was $39.5 million and $38.2 million, respectively.
Results of operations
Throughout the following discussion of our operating results, we present our net interest income, net interest margin and core efficiency ratio on a fully tax-equivalent basis. The fully tax-equivalent basis adjusts for the tax-favored status of net interest income from certain qualifying loans and investments.
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, 2025 and 2024.
Net interest income
Net interest income is the principle 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 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. In contrast, during the three and nine months ended September 30, 2024, the yield curve remained inverted, consistent with tighter monetary policy and elevated short-term interest rates. The Federal Funds Target Rate range was 4.00% - 4.25% and 4.75% - 5.00% as of September 30, 2025 and September 30, 2024, respectively. During the Federal Open Market Committee's October 29, 2025 meeting, the federal funds rate was lowered 25 basis points.
Three months ended September 30, 2025 compared to three months ended September 30, 2024
Net interest income increased to $148.1 million for the three months ended September 30, 2025 as compared to $106.6 million for the three months ended September 30, 2024. Net interest margin was 3.95% for the three months ended September 30, 2025 compared to 3.55% for the three months ended September 30, 2024. The increase in net interest income and net interest margin reflects a $51.5 million increase in interest income, partially offset by a $10.0 million increase in interest expense.
Interest income was $237.7 million for the three months ended September 30, 2025, compared to $186.2 million for the three months ended September 30, 2024, an increase of $51.5 million, which was primarily driven by an increase in volume of interest earning assets, most notably loans HFI due to the Southern States merger, and a modest increase in yields.
Interest income on loans HFI increased $49.7 million to $207.4 million for the three months ended September 30, 2025 from $157.8 million for the three months ended September 30, 2024 due to increased volume and higher yields stemming from the Southern States merger, including accretion on those recently purchased loans. The yield on loans HFI was 6.75% for the three months ended September 30, 2025, up 5 basis points from the three months ended September 30, 2024.
The components of our loan yield for the three months ended September 30, 2025 and 2024 were as follows:
Three Months Ended September 30,
2025 2024
(dollars in thousands) Interest
income 		Average
yield 		Interest
income 		Average
yield
Loan HFI yield components:
Contractual interest rate on loans HFI(1)
$ 198,320 6.45 % $ 155,884 6.62 %
Origination and other loan fee income 1,575 0.05 % 1,779 0.08 %
Accretion (amortization) on purchased loans 7,025 0.23 % (10) - %
Nonaccrual interest collections 503 0.02 % 98 - %
Total loan HFI yield $ 207,423 6.75 % $ 157,751 6.70 %
(1) Includes tax equivalent adjustment using combined marginal tax rate of 26.06%.
Accretion on purchased loans contributed 19 basis points to the NIM for the three months ended September 30, 2025 as a result of the Southern States merger. There was no impact of accretion on purchased loans to the NIM for the three months ended September 30, 2024.
Interest expense was $89.7 million for the three months ended September 30, 2025, an increase of $10.0 million as compared to the three months ended September 30, 2024, which was driven by a combination of higher average balance of interest-bearing liabilities, somewhat offset by a decrease in the rate paid on interest-bearing liabilities. These changes were primarily attributable to the merger with Southern States, but also impacted by management's deposit strategy.
Interest expense on interest-bearing deposit accounts totaled $86.6 million for the three months ended September 30, 2025, a $10.5 million increase from the $76.1 million recognized for the three months ended September 30, 2024. The increase in interest expense caused by the merger with Southern States increased the average balance of most of the deposit categories. The increase in interest expense caused by increases in average balances were partially offset by decreases in the rate paid on most interest-bearing deposit categories, led by interest-bearing checking. The decrease in the rate paid on interest-bearing deposit balances was due to a combination of the Southern States merger and strategic efforts by management to more effectively manage rates paid on deposits. Total cost of interest-bearing deposits was 3.16% for the three months ended September 30, 2025 compared to 3.58% for the three months ended September 30, 2024 as interest rates decrease.
Interest expense recognized on other borrowings decreased $1.5 million for the three months ended September 30, 2025 due to the repayment of the Bank Term Funding Program which was paid off during the third quarter of 2024.
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,
2025 2024
(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)
$ 12,189,401 $ 207,423 6.75 % $ 9,362,937 $ 157,751 6.70 %
Mortgage loans held for sale 162,205 2,359 5.77 % 66,828 1,102 6.56 %
Investment securities:
Taxable 1,304,894 14,395 4.38 % 1,487,200 13,943 3.73 %
Tax-exempt(2)
169,523 1,431 3.35 % 181,465 1,493 3.27 %
Total investment securities(2)
1,474,417 15,826 4.26 % 1,668,665 15,436 3.68 %
Federal funds sold and reverse repurchase agreements
331,029 3,966 4.75 % 118,715 1,687 5.65 %
Interest-bearing deposits with other financial institutions 671,634 7,340 4.34 % 701,666 9,519 5.40 %
FHLB stock 36,907 832 8.94 % 32,919 750 9.06 %
Total interest-earning assets(2)
14,865,593 237,746 6.35 % 11,951,730 186,245 6.20 %
Noninterest-earning assets:
Cash and due from banks 139,226 131,308
Allowance for credit losses on loans HFI (181,973) (155,665)
Other assets (3)(4)
1,184,942 814,577
Total noninterest-earning assets 1,142,195 790,220
Total assets $ 16,007,788 $ 12,741,950
Interest-bearing liabilities:
Interest bearing deposits:
Interest-bearing checking $ 2,331,589 $ 12,383 2.11 % $ 2,624,046 $ 20,998 3.18 %
Money market deposits 5,561,538 49,019 3.50 % 3,802,818 37,574 3.93 %
Savings deposits 406,787 248 0.24 % 357,165 65 0.07 %
Customer time deposits 1,997,905 18,965 3.77 % 1,349,986 13,479 3.97 %
Brokered and internet time deposits 560,127 5,962 4.22 % 322,667 3,972 4.90 %
Time deposits 2,558,032 24,927 3.87 % 1,672,653 17,451 4.15 %
Total interest-bearing deposits 10,857,946 86,577 3.16 % 8,456,682 76,088 3.58 %
Other interest-bearing liabilities:
Securities sold under agreements to repurchase and federal funds
purchased 		13,144 31 0.94 % 21,734 79 1.45 %
Federal Home Loan Bank advances 15,217 172 4.48 % - - - %
Subordinated debt 180,805 2,872 6.30 % 130,561 1,900 5.79 %
Other borrowings 1,168 6 2.04 % 125,616 1,544 4.89 %
Total other interest-bearing liabilities 210,334 3,081 5.81 % 277,911 3,523 5.04 %
Total Interest-bearing liabilities 11,068,280 89,658 3.21 % 8,734,593 79,611 3.63 %
Noninterest-bearing liabilities:
Demand deposits 2,724,898 2,241,512
Other liabilities(4)
236,732 242,155
Total noninterest-bearing liabilities 2,961,630 2,483,667
Total liabilities 14,029,910 11,218,260
FB Financial Corporation common shareholders' equity 1,977,785 1,523,597
Noncontrolling interest 93 93
Shareholders' equity 1,977,878 1,523,690
Total liabilities and shareholders' equity $ 16,007,788 $ 12,741,950
Net interest income (tax-equivalent basis)(2)
$ 148,088 $ 106,634
Interest rate spread (tax-equivalent basis)(2)
3.14 % 2.57 %
Net interest margin (tax-equivalent basis)(2)(5)
3.95 % 3.55 %
Cost of total deposits 2.53 % 2.83 %
Average interest-earning assets to average interest-bearing liabilities 134.3 % 136.8 %
(1) Average balances of nonaccrual loans and overdrafts are included in average loan balances (before deduction of ACL).
(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 $0.8 million and $0.6 million the three months ended September 30, 2025 and 2024, respectively.
(3) Includes average net unrealized losses on investment securities available for sale of $64.8 million and $153.8 million for the three months ended September 30, 2025 and 2024, respectively.
(4) Includes average of optional rights to repurchase government guaranteed GNMA mortgage loans previously sold that have become past due greater than 90 days of $21.6 million and $25.5 million
for the three months ended September 30, 2025 and 2024, 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, 2025 and 2024. 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, 2025 compared to three months ended September 30, 2024 due to changes in
(dollars in thousands) Volume Yield/rate Net increase
(decrease)
Interest-earning assets:
Loans held for investment(1)(2)
$ 48,097 $ 1,575 $ 49,672
Loans held for sale - mortgage 1,387 (130) 1,257
Investment securities:
Taxable (2,011) 2,463 452
Tax Exempt(2)
(101) 39 (62)
Federal funds sold and reverse repurchase agreements
2,544 (265) 2,279
Interest-bearing deposits with other financial institutions (328) (1,851) (2,179)
FHLB stock 90 (8) 82
Total interest income(2)
49,678 1,823 51,501
Interest-bearing liabilities:
Interest-bearing checking (1,553) (7,062) (8,615)
Money market deposits 15,501 (4,056) 11,445
Savings deposits 30 153 183
Customer time deposits 6,150 (664) 5,486
Brokered and internet time deposits 2,528 (538) 1,990
Securities sold under agreements to repurchase and federal funds
purchased 		(20) (28) (48)
Federal Home Loan Bank advances 172 - 172
Subordinated debt 798 174 972
Other borrowings (639) (899) (1,538)
Total interest expense 22,967 (12,920) 10,047
Change in net interest income(2)
$ 26,711 $ 14,743 $ 41,454
(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 was $0.8 million and $0.6 million the three months ended September 30, 2025 and 2024, respectively.
Nine months ended September 30, 2025 compared to the nine months ended September 30, 2024
Net interest income increased $58.7 million to $368.8 million for the nine months ended September 30, 2025 as compared to $310.1 million for the nine months ended September 30, 2024. Net interest margin was 3.74% for the nine months ended September 30, 2025 compared to 3.51% for the nine months ended September 30, 2024. The increases in net interest income and net interest margin were primarily driven by increases in interest income on loans HFI and investment securities.
Interest income was $601.1 million for the nine months ended September 30, 2025, compared to $541.1 million for the nine months ended September 30, 2024, an increase of $60.0 million, which was primarily driven by an increase in volume of interest earning assets, most notably loans HFI due to the merger with Southern States, partially offset by a decrease in yields due to lower interest rates.
Interest income recognized on loans HFI increased $50.6 million to $517.6 million for the nine months ended September 30, 2025 from $466.9 million for the nine months ended September 30, 2024. This increase was attributable to
an increase in average balances of loans HFI as a result of the Southern States merger, partially offset by a decline in the overall yield on loans HFI due to lower interest rates. The yield on loans HFI decreased 13 basis points to 6.55% for the nine months ended September 30, 2025 from 6.68% for the nine months ended September 30, 2024.
The components of our loan yield for the nine months ended September 30, 2025 and 2024 were as follows:
Nine Months Ended September 30,
2025 2024
(dollars in thousands) Interest
income 		Average
yield 		Interest
income 		Average
yield
Loans HFI yield components:
Contractual interest rate on loans HFI(1)
$ 503,836 6.37 % $ 460,796 6.59 %
Origination and other loan fee income 5,317 0.07 % 4,506 0.06 %
Accretion on purchased loans 6,965 0.09 % 538 0.01 %
Nonaccrual interest collections 1,443 0.02 % 1,093 0.02 %
Total loans HFI yield $ 517,561 6.55 % $ 466,933 6.68 %
(1)Includes tax equivalent adjustment using combined marginal tax rate of 26.06%.
Accretion on purchased loans contributed 7 basis points to the NIM for the nine months ended September 30, 2025 as a result of the Southern States merger. There was no impact of accretion on purchased loans to the NIM for the nine months ended September 30, 2024.
Interest income on investment securities increased $7.7 million to $47.8 million for the nine months ended September 30, 2025 from $40.0 million for the nine months ended September 30, 2024. The increase was attributable to the increase in yield stemming from portfolio restructuring transactions in prior quarters and years. The yield on investment securities was 3.92% and 3.23% for the nine months ended September 30, 2025 and 2024, respectively, an increase of 69 basis points.
Interest expense was $232.4 million for the nine months ended September 30, 2025, an increase of $1.3 million as compared to $231.0 million for the nine months ended September 30, 2024. This impact was driven by increases in average balances on interest-bearing deposit accounts due to the Southern States merger, mostly offset by declines in the rate paid on interest-bearing deposit accounts and other borrowings.
Interest expense on interest-bearing deposit accounts totaled $225.4 million for the nine months ended September 30, 2025, a $5.2 million increase from the $220.2 million recognized for the nine months ended September 30, 2024. The increase in interest expense on interest-bearing deposit accounts was largely driven by an increase in the average balance of most deposit categories, most notably money market deposit balances, mostly offset by decreases in the rate paid on across deposit categories. The increases in average balances were largely attributable to the Southern States merger, as well as our proactive liquidity management strategy and customer deposit campaign which added both balances and reduction in rate paid on those balances. The average rate paid on interest-bearing deposits was 3.13% for the nine months ended September 30, 2025 compared to 3.53% for the nine months ended September 30, 2024.
Interest expense recognized on other borrowings decreased $4.7 million for the nine months ended September 30, 2025 due to the repayment of the Bank Term Funding Program which was paid off during the third quarter of 2024.
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,
2025 2024
(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)
$ 10,559,871 $ 517,561 6.55 % $ 9,337,942 $ 466,933 6.68 %
Mortgage loans held for sale 127,657 5,981 6.26 % 65,443 3,333 6.80 %
Investment securities:
Taxable 1,459,685 43,527 3.99 % 1,450,295 35,014 3.22 %
Tax-exempt (2)
168,390 4,229 3.36 % 205,310 5,023 3.27 %
Total investment securities (2)
1,628,075 47,756 3.92 % 1,655,605 40,037 3.23 %
Federal funds sold and reverse repurchase agreements 189,984 6,596 4.64 % 127,365 5,310 5.57 %
Interest-bearing deposits with other financial institutions 635,796 20,975 4.41 % 573,861 23,226 5.41 %
FHLB stock 35,024 2,274 8.68 % 33,486 2,295 9.15 %
Total interest-earning assets (2)
13,176,407 601,143 6.10 % 11,793,702 541,134 6.13 %
Noninterest-earning assets:
Cash and due from banks 126,093 141,220
Allowance for credit losses on loans HFI (162,040) (152,675)
Other assets (3)(4)
952,215 786,211
Total noninterest-earning assets 916,268 774,756
Total assets $ 14,092,675 $ 12,568,458
Interest-bearing liabilities:
Interest-bearing deposits:
Interest-bearing checking $ 2,562,483 $ 46,520 2.43 % $ 2,554,739 $ 59,088 3.09 %
Money market deposits 4,592,506 118,336 3.45 % 3,810,318 112,031 3.93 %
Savings deposits 371,180 412 0.15 % 368,262 191 0.07 %
Customer time deposits 1,594,062 44,121 3.70 % 1,398,263 41,415 3.96 %
Brokered and internet time deposits 495,671 16,005 4.32 % 195,785 7,489 5.11 %
Time deposits 2,089,733 60,126 3.85 % 1,594,048 48,904 4.10 %
Total interest-bearing deposits 9,615,902 225,394 3.13 % 8,327,367 220,214 3.53 %
Other interest-bearing liabilities:
Securities sold under agreements to
repurchase and federal funds purchased 		11,773 63 0.72 % 23,537 350 1.99 %
Federal Home Loan Bank advances 12,821 430 4.48 % - - - %
Subordinated debt 147,654 6,489 5.88 % 130,249 5,801 5.95 %
Other borrowings 1,560 16 1.37 % 129,396 4,682 4.83 %
Total other interest-bearing liabilities 173,808 6,998 5.38 % 283,182 10,833 5.11 %
Total interest-bearing liabilities 9,789,710 232,392 3.17 % 8,610,549 231,047 3.58 %
Noninterest-bearing liabilities:
Demand deposits 2,357,537 2,230,271
Other liabilities(4)
228,944 241,535
Total noninterest-bearing liabilities 2,586,481 2,471,806
Total liabilities 12,376,191 11,082,355
FB Financial Corporation common
shareholders' equity 		1,716,391 1,486,010
Noncontrolling interest 93 93
Shareholders' equity 1,716,484 1,486,103
Total liabilities and shareholders' equity $ 14,092,675 $ 12,568,458
Net interest income (tax-equivalent basis)(2)
$ 368,751 $ 310,087
Interest rate spread (tax-equivalent basis)(2)
2.93 % 2.55 %
Net interest margin (tax-equivalent basis) (2)(5)
3.74 % 3.51 %
Cost of total deposits 2.52 % 2.79 %
Average interest-earning assets to average
interest-bearing liabilities 		134.6 % 137.0 %
(1)Average balances of nonaccrual loans and overdrafts are included in average loan balances.
(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. to increase tax-exempt interest income to a tax-equivalent basis. The net tax-equivalent adjustment amounts included in income were $2.5 million and $2.0 million for nine months
ended September 30, 2025 and 2024, respectively.
(3)Includes average net unrealized losses on investment securities available for sale of $108.4 million and $181.9 million for the nine months ended September 30, 2025 and 2024, respectively.
(4)Includes average of optional rights to repurchase government guaranteed GNMA mortgage loans previously sold that meet certain defined delinquency criteria of $25.8 million and $22.3 million for the nine months ended September 30, 2025 and 2024, respectively.
(5)The NIM is calculated by dividing annualized net interest income, on a tax-equivalent basis, by average total earning assets.
Yield/rate and volume analysis
The tables below present the components of the changes in net interest income for the nine months ended September 30, 2025 and 2024. 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, 2025 compared to nine months ended September 30, 2024 due to changes in
(dollars in thousands) Volume Yield/rate Net increase
(decrease)
Interest-earning assets:
Loans HFI(1)(2)
$ 59,889 $ (9,261) $ 50,628
Loans held for sale - mortgage 2,915 (267) 2,648
Investment securities:
Taxable 280 8,233 8,513
Tax-exempt(2)
(927) 133 (794)
Federal funds sold and reverse repurchase agreements
2,174 (888) 1,286
Interest-bearing deposits with other financial institutions 2,043 (4,294) (2,251)
FHLB stock 100 (121) (21)
Total interest income(2)
66,474 (6,465) 60,009
Interest-bearing liabilities:
Interest-bearing checking deposits 141 (12,709) (12,568)
Money market deposits 20,155 (13,850) 6,305
Savings deposits 3 218 221
Customer time deposits 5,419 (2,713) 2,706
Brokered and internet time deposits 9,683 (1,167) 8,516
Securities sold under agreements to repurchase and federal funds
purchased 		(63) (224) (287)
Federal Home Loan Bank advances 430 - 430
Subordinated debt 765 (77) 688
Other borrowings (1,311) (3,355) (4,666)
Total interest expense 35,222 (33,877) 1,345
Change in net interest income(2)
$ 31,252 $ 27,412 $ 58,664
(1)Average loans are presented gross, including nonaccrual loans and overdrafts.
(2)Interest income includes the effects of the tax-equivalent adjustments to increase tax-exempt interest income to a tax-equivalent basis. The net taxable-equivalent adjustment amounts included was $2.5 million and $2.0 million for the nine months ended September 30, 2025 and 2024, respectively.
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, 2025 resulted from management's best estimate of losses over the life of loans and unfunded commitments in our portfolio in accordance with the CECL approach.
Beginning on June 30, 2025, we utilize the discounted cash flow estimation technique, adjusted for current conditions and reasonable and supportable forecasts, to estimate the expected credit losses of its loan segments, except consumer and other loans, which utilizes the weighted average remaining maturity loss rate technique. We determined that the use of the updated estimate techniques and related inputs and assumptions enhances the transparency, accuracy and relevance of information relating to its allowance for credit losses through the application of data and calculations more clearly
calibrated to our historical experience, the nature of its loan portfolio and unfunded commitments, and expectations for future economic conditions and corresponding expected credit losses.
These changes represent a change in accounting estimate under ASC 250, "Accounting Changes and Error Corrections", and, accordingly, is applied prospectively in the period of change and did not have a material effect on the Company's financial statements. See "Note 1, "Basis of presentation" in this Report 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 selected peer banks for each loan segment. We determined that national unemployment, national housing price index, national commercial real estate index and prime rates were the key economic variables that were most correlated to our historical loss performance and our peer banks. Reasonable and supportable forecasts of these economic indicators are utilized within the discounted cash flow to estimate expected credit losses for each loan segment. Current and forecast economic conditions, including those affecting these and other economic variables or macroeconomic conditions, such as global conflicts or tariffs, may continue to lead to increased volatility in our calculated level of allowance for credit losses.
Prior to the changes described above, our estimates for credit losses calculation utilized lifetime loss rate model and included economic forecasts for unemployment, gross domestic product, as well as other macroeconomic events which may impact our loan portfolio. Refer to Note 1, "Basis of presentation and summary of significant accounting policies" in the Company's Annual Report on Form 10-K for the year ended December 31, 2024, for a detailed discussion regarding ACL methodology.
Three months ended September 30, 2025 compared to three months ended September 30, 2024
We recognized a provision expense for credit losses on loans HFI of $30.0 million and $1.9 million for the three months ended September 30, 2025 and 2024, respectively. The provision expense for credit losses on loans HFI for the three months ended September 30, 2025 was driven by the initial provision on acquired loans HFI from the Southern States merger of $25.1 million with changes in loan balances and forecast assumptions driving the remaining expense. For the three months ended September 30, 2024, the decrease in our provision for credit losses on loans HFI was primarily due to reductions in balances outstanding for construction loans offset by growth in other classes of financing receivable in our loan portfolio.
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 expense for credit losses on unfunded commitments of $4.5 million and $0.1 million for the three months ended September 30, 2025 and 2024, respectively. The provision expense was due largely to the initial provision on acquired unfunded commitments from the Southern States merger of $3.2 million. For three months ended September 30, 2024, the provision is due to a decrease in our unfunded commitments during the period, namely in our construction portfolio. Commitments increased in commercial and industrial and residential real estate line of credit portfolios offset by reductions in construction and commercial real estate.
During the three months ended September 30, 2025 and 2024 it was 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, 2025 and 2024.
Nine months ended September 30, 2025 compared to nine months ended September 30, 2024
We recognized a provision for credit losses on loans HFI for the nine months ended September 30, 2025 and 2024 of $30.8 million and $7.6 million, respectively. The current period provision on loans HFI was driven by a $25.1 million initial provision on acquired loans HFI from the Southern States merger and regular changes in loan balances and forecast inputs offset by a $6.8 million reduction from the impact of the change in the CECL loss estimation methodology. For the nine months ended September 30, 2024, the provision on loans HFI was due to growth in loan balances for most loan categories offset by significant decreases in construction lending.
We recorded a provision for credit losses on unfunded commitments of $11.3 million and a reversal of $2.7 million for the nine months ended September 30, 2025 and 2024, respectively. For the nine months ended September 30, 2025, the increase in provision for credit losses on unfunded commitments was due largely to the $6.5 million impact of the change in the CECL loss estimation methodology combined with $3.2 million for the initial provision on acquired unfunded commitments associated with the Southern States merger. The reversal of provision for credit losses on unfunded
commitments for the nine months ended September 30, 2024 was primarily due to management's concentrated effort to reduce unfunded loan commitments during the period.
During the nine months ended September 30, 2025 and 2024, it was 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, 2025 and 2024.
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) 2025 2024 2025 2024
Mortgage banking income $ 13,484 $ 11,553 $ 38,939 $ 36,048
Investment services and trust income 4,227 3,721 11,860 10,338
Service charges on deposit accounts 4,049 3,378 10,920 9,686
ATM and interchange fees 3,388 2,840 8,943 8,598
Gain (loss) from investment securities, net 12 (40,165) (60,521) (56,378)
Loss on sales or write-downs of premises and equipment, other real estate owned and other assets (646) (289) (1,035) (5)
Other income 2,121 2,465 6,009 8,786
Total noninterest income (loss) $ 26,635 $ (16,497) $ 15,115 $ 17,073
Three months ended September 30, 2025 compared to three months ended September 30, 2024
Noninterest income amounted to $26.6 million for the three months ended September 30, 2025, an increase of $43.1 million, as compared to a $16.5 million loss for the three months ended September 30, 2024. The increase in noninterest income was driven by the net loss from investment securities during the three months ended September 30, 2024. Excluding the recognition of the $40.2 million of net loss from investment securities sales recognized during the three months ended September 30, 2024, noninterest income was $23.7 million for the three months ended September 30, 2024.
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 $13.5 million for the three months ended September 30, 2025, an increase of $1.9 million compared to the prior period. The increase was driven by positive fair value changes of $1.3 million from the prior period. This was impacted by the increase in interest rate lock volume of $50.9 million, or 13.4% during the current period over the same period in the prior year.
Investment services and trust income is comprised of wealth management fees and trust and insurance income. This caption increased $0.5 million during the three months ended September 30, 2025 to $4.2 million as compared to $3.7 million during the three months ended September 30, 2024.
Service charges on deposit accounts include overdraft fees, account analysis fees and other customer transaction-related service charges. Service charges on deposit accounts increased $0.7 million during the three months ended September 30, 2025 to $4.0 million as compared to $3.4 million during the three months ended September 30, 2024.
ATM and interchange fees represent income related to customers' utilization of their debit cards and interchange income. ATM and interchange fees were $3.4 million for the three months ended September 30, 2025, compared to $2.8 million for the three months ended September 30, 2024.
Net gain from investment securities was $12 thousand for the three months ended September 30, 2025 compared to a net loss of $40.2 million for the three months ended September 30, 2024. The net loss from investment securities during the three months ended September 30, 2024 was the result of management's election to sell $318.5 million of AFS debt securities. Refer to the section "Other earnings 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 was $0.6 million for the three months ended September 30, 2025 compared to $0.3 million for the three months ended September 30, 2024.
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 decreased $0.3 million to $2.1 million during the three months ended September 30, 2025 as compared to $2.5 million during the three months ended September 30, 2024. This decrease was primarily due to a $0.6 million loss associated with our proportionate share of loss on our equity method investment during the three months ended September 30, 2025.
Nine months ended September 30, 2025 compared to nine months ended September 30, 2024
Noninterest income amounted to $15.1 million for the nine months ended September 30, 2025, a decrease of $2.0 million, as compared to income of $17.1 million for the nine months ended September 30, 2024. Excluding the recognition of the $60.5 million and $56.4 million of net loss from investment securities sales recognized during the nine months ended September 30, 2025 and 2024, respectively, noninterest income was $75.6 million and $73.5 million for the nine months ended September 30, 2025 and 2024, respectively.
Mortgage banking income was $38.9 million for the nine months ended September 30, 2025, an increase of $2.9 million compared to the prior period. The increase includes an increase from gains on sale and related fair value changes of $2.8 million to $28.8 million in the current period compared to $26.0 million in the prior period. This was impacted by the increase in interest rate lock volume of $127.0 million, or 11.1% during the current period over the same period in the prior year.
Investment services and trust income increased $1.5 million during the nine months ended September 30, 2025 to $11.9 million as compared to $10.3 million during the nine months ended September 30, 2024. The increase was primarily attributable to fees earned from higher assets under management stemming from existing account growth.
Service charges on deposit accounts increased $1.2 million during the nine months ended September 30, 2025 to $10.9 million as compared to $9.7 million during the nine months ended September 30, 2024.
ATM and interchange fees were $8.9 million for the nine months ended September 30, 2025, compared to $8.6 million for the nine months ended September 30, 2024.
Net loss from investment securities was $60.5 million for the nine months ended September 30, 2025 compared to $56.4 million for the nine months ended September 30, 2024. 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 compared to $526.4 million of AFS debt securities sold during the prior year period. Refer to the section "Other earning assets" for additional information on the sale of the AFS debt securities.
Net loss on sales or write-downs of premises and equipment, other real estate owned and other assets increased $1.0 million for the nine months ended September 30, 2025.
Other income decreased $2.8 million to $6.0 million during the nine months ended September 30, 2025 as compared to $8.8 million during the nine months ended September 30, 2024. This decrease was driven by a $1.7 million loss associated with our proportionate share of loss on our equity method investment during the nine months ended September 30, 2025 and a $2.1 million increase in BOLI income recognized during the nine months ended September 30, 2024, resulting from proceeds from payment of death benefits. The decrease was partially offset by a $0.8 million increase in owned property lease income during the nine months ended September 30, 2025.
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) 2025 2024 2025 2024
Salaries, commissions and employee benefits $ 59,210 $ 47,538 $ 154,192 $ 138,381
Merger and integration costs 16,057 - 19,192 -
Occupancy and equipment expense 7,539 6,640 20,846 19,582
Data processing 2,457 2,486 6,931 7,180
Advertising 2,453 1,947 7,118 4,977
Amortization of core deposit and other intangibles 2,079 719 3,366 2,260
Legal and professional fees 1,227 1,900 5,645 5,798
Other expense 18,834 14,982 53,376 45,547
Total noninterest expense $ 109,856 $ 76,212 $ 270,666 $ 223,725
Three months ended September 30, 2025 compared to three months ended September 30, 2024
Noninterest expense increased by $33.6 million, or 44.1%, during the three months ended September 30, 2025 to $109.9 million as compared to $76.2 million in the three months ended September 30, 2024. The increase in noninterest expense was driven by increases in merger and integration costs associated with the Southern States merger, salaries and employee benefits and other expense.
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, 2025, salaries and employee benefits expense increased $11.7 million, to $59.2 million as compared to $47.5 million for the three months ended September 30, 2024. This change was driven by increases in the salaries and benefit costs due to increased headcount resulting from the Southern States merger, combined with increases in performance-based compensation resulting from improvements in the Company's performance metrics.
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, costs associated with branch consolidation and integration costs of the Southern States merger.
Occupancy and equipment expense includes occupancy, depreciation and equipment expense. Occupancy and equipment expense of $7.5 million and $6.6 million was recognized for the three months ended September 30, 2025 and 2024, respectively. The increase was primarily due to the expansion of our branch network in connection with the Southern States merger.
Data processing is comprised of all third-party core operating system and processing charges as well as payroll processing. Data processing fees were $2.5 million for both the three months ended September 30, 2025 and 2024.
Advertising includes expenses related to sponsorships, advertising, marketing, customer relations and business development and public relations. During the three months ended September 30, 2025, advertising expense increased $0.5 million to $2.5 million compared to $1.9 million during the three months ended September 30, 2024.
Amortization of core deposit and other intangibles were $2.1 million for the three months ended September 30, 2025, compared to $0.7 million for the three months ended September 30, 2024. The increase was primarily due to $1.5 million of amortization associated with the core deposit intangible assumed with the merger of Southern States.
Legal and professional fees represent fees incurred for the various support functions, which includes legal, consulting, outsourcing and other professional related fees. Legal and professional fees were $1.2 million and $1.9 million for the three months ended September 30, 2025 and 2024, respectively.
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 $3.9 million during the three months ended September 30, 2025 to $18.8 million compared to $15.0 million during the three months ended September 30, 2024. The
increase was primarily driven by modest increases across a range of expense categories, including technology and platform fees, software license and maintenance fees, card transaction fees, servicing fees and other operating expenses. No single category accounted for a significant portion of the overall increase. Additionally, a franchise tax benefit was recognized in the prior year period.
Nine months ended September 30, 2025 compared to nine months ended September 30, 2024
Noninterest expense increased by $47.0 million, or 21.0%, during the nine months ended September 30, 2025 to $270.7 million as compared to $223.7 million in the nine months ended September 30, 2024. The increase in noninterest expense was attributable to increases in merger and integration costs associated with the Southern States merger, salaries and employee benefits and other noninterest expense.
Salaries, commissions and employee benefits expense increased $15.8 million, or 11.4%, to $154.2 million for the nine months ended September 30, 2025 as compared to $138.4 million for the nine months ended September 30, 2024. This change was driven by increases in the salaries and benefit costs due to increased headcount resulting from the Southern States merger, combined with an increase in performance-based compensation driven by improvement in the Company's performance metrics.
Merger and integration costs were $19.2 million for the nine months ended September 30, 2025 associated with the merger with Southern States. These costs primarily include legal and professional fees, severance and other employee-related costs, costs associated with branch consolidation and integration costs.
Occupancy and equipment expense of $20.8 million and $19.6 million was recognized for the nine months ended September 30, 2025 and 2024. The increase was driven by the expansion of our branch network in connection with the Southern States merger.
Data processing fees were $6.9 million for the nine months ended September 30, 2025, compared to $7.2 million for the nine months ended September 30, 2024.
Advertising expense increased $2.1 million to $7.1 million during the nine months ended September 30, 2025 compared to $5.0 million during the nine months ended September 30, 2024. This increase was primarily attributable to customer marketing campaigns during nine months ended September 30, 2025 combined with favorable, volume based marketing rebate activity recorded in the prior year period.
Amortization of core deposit and other intangibles were $3.4 million for the nine months ended September 30, 2025, compared to $2.3 million for the nine months ended September 30, 2024. The increase was primarily due to $1.5 million of amortization associated with the core deposit intangible assumed with the merger of Southern States.
Legal and professional fees were $5.6 million and $5.8 million for the nine months ended September 30, 2025 and 2024, respectively.
Other noninterest expense increased $7.8 million during the nine months ended September 30, 2025 to $53.4 million compared to $45.5 million during the nine months ended September 30, 2024. The increase was primarily related to $1.8 million of technology and platform fee increases and modest increases across a range of other expense categories, including software license and maintenance fees, card transaction fees, servicing fees and other operating expenses. Additionally, a franchise tax benefit was recognized in the prior year period.
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 63.2% and 71.0% for the three and nine months ended September 30, 2025, respectively, and 85.1% and 68.8% for the three and nine months ended September 30, 2024, respectively. Our adjusted efficiency ratio, on a tax-equivalent basis, was 53.3% and 56.4% for the three and nine months ended September 30, 2025, respectively, and 58.4% and 58.2% for the three and nine months ended September 30, 2024, 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 $6.2 million and $3.0 million for the three and nine months ended September 30, 2025, respectively, and $1.2 million and $18.4 million for the three and nine months ended September 30, 2024, respectively. This represents effective tax rates of 21.0% and 4.4% for the three and nine months ended September 30, 2025, respectively, and 10.3% and 19.1% for the three and nine months ended September 30, 2024, respectively. The primary differences from the enacted rates are applicable state income taxes and certain expenses that are not deductible, reduced for non-taxable income.
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 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. There was no one-time tax benefit for the three months ended September 30, 2025. For the three and nine months ended September 30, 2024, income tax expense included the income tax effect of loss on sale of AFS debt securities of $40.2 million and $56.4 million, respectively. Refer to Note 10 "Income taxes" in the notes to the consolidated financial statements for additional information regarding the our income tax benefit/expense and effective tax rates.
Financial condition
The following discussion of our financial condition compares balances as of September 30, 2025 and December 31, 2024.
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,
2025 2024
(dollars in thousands) Committed Amount Outstanding % of total outstanding Committed Amount Outstanding % of total outstanding
Loan Type:
Commercial and industrial
 		$ 3,606,471 $ 2,155,105 17 % $ 3,062,626 $ 1,691,213 18 %
Construction 1,927,134 1,195,392 10 % 1,585,865 1,087,732 11 %
Residential real estate:
1-to-4 family mortgage 1,858,207 1,852,626 15 % 1,624,053 1,616,754 17 %
Residential line of credit 1,516,264 707,303 6 % 1,336,506 602,475 6 %
Multi-family mortgage 743,089 736,424 6 % 665,813 653,769 7 %
Commercial real estate:
Owner-occupied 2,221,207 2,124,920 17 % 1,436,424 1,357,568 14 %
Non-owner occupied 2,958,526 2,890,233 24 % 2,154,027 2,099,129 22 %
Consumer and other 657,077 635,597 5 % 507,175 493,744 5 %
Total loans $ 15,487,975 $ 12,297,600 100 % $ 12,372,489 $ 9,602,384 100 %
Our loans HFI portfolio is our most significant earning asset, comprising 75.7% and 73.0% of our total assets at September 30, 2025 and December 31, 2024, 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, 2025 and December 31, 2024, loans HFI included approximately $429.2 million and $177.6 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, 2025 and 2024, we sold $10.0 million and $7.5 million loan participations, respectively. During the nine months ended September 30, 2025 and 2024, we sold $13.5 million and $24.5 million 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, 2025 and December 31, 2024, 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, multifamily, 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, 2025 and December 31, 2024.
As a percentage (%) of tier 1 capital plus allowance for credit losses
FirstBank FB Financial Corporation
September 30, 2025
Construction 63.8 % 64.7 %
Commercial real estate 259.0 % 262.6 %
December 31, 2024
Construction 70.1 % 67.1 %
Commercial real estate 249.3 % 238.5 %
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 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 for first time home buyers. 100% financed mortgages loans are further evaluated separately from the 1-4 family mortgage pool due to high initial loan value. This pool also includes our manufactured housing loans secured by real estate collateral. Repayment of loans in this loan segment are 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 includes junior liens 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, multifamily properties, and assisted living facilities. Commercial real estate non-owner occupied loans are typically repaid with the funds received from the sale or refinancing of the property or rental income from such 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. As these manufacturing 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 determine potential risks associated with industry concentrations, and if any risk issues 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, 2025
(dollars in thousands) Committed Amount Outstanding
Nonperforming(1)
Commercial and industrial
Real estate rental and leasing $ 501,026 $ 314,190 $ 311
Finance and insurance 498,952 314,124 -
Construction 443,940 159,973 834
Manufacturing 317,119 230,450 882
Wholesale trade 293,594 174,220 179
Information 256,546 184,435 -
Professional, scientific and technical services 208,950 132,067 9
Educational services 173,503 48,842 -
Retail trade 131,073 89,019 556
Health care and social assistance 106,939 56,495 437
Administrative and support and waste management and
remediation services 		106,290 78,722 -
Accommodation and food services 104,667 74,978 714
Other services (except public administration) 103,602 66,627 76
Transportation and warehousing 103,070 95,724 2,091
Arts, entertainment and recreation 70,716 43,595 112
Management of companies and enterprises 40,276 25,176 -
Other 146,208 66,468 725
Total $ 3,606,471 $ 2,155,105 $ 6,926
Commercial real estate owner-occupied
Real estate rental and leasing $ 357,338 $ 342,913 $ 364
Retail trade 310,318 301,044 -
Other services (except public administration) 286,187 278,739 3,882
Manufacturing 250,839 239,294 160
Health care and social assistance 216,310 211,738 873
Accommodation and food services 153,291 153,229 1,182
Wholesale trade 139,152 134,144 -
Construction 114,390 101,383 -
Transportation and warehousing 83,760 67,326 488
Professional, scientific and technical services 56,186 54,622 90
Arts, entertainment and recreation 45,238 44,625 -
Administrative and support and waste management and
remediation services 		37,285 34,860 478
Agriculture, forestry, fishing and hunting 35,809 31,902 620
Management of companies and enterprises 22,661 20,691 -
Educational services 22,242 21,491 -
Finance and insurance 19,702 18,465 2,668
Other 70,499 68,454 195
Total $ 2,221,207 $ 2,124,920 $ 11,000
(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 determine potential risks associated with collateral types, and if any risk issues 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, 2025
(dollars in thousands) Committed Amount Outstanding
Nonperforming(1)
Commercial real estate non-owner occupied
Retail $ 633,994 $ 621,525 $ 3,374
Office 542,641 527,202 1,037
Warehouse and industrial 540,997 517,630 -
Hotel 486,082 484,275 -
Assisted living and special care facilities 147,583 145,841 -
Self-storage 144,145 143,292 101
Land-Manufactured housing 120,706 119,032 129
Healthcare facility 71,766 71,695 -
Restaurants, bars and event venues 57,834 52,601 1,008
Convenience store and gas station 50,523 49,874 -
Other 162,255 157,266 -
Total $ 2,958,526 $ 2,890,233 $ 5,649
Construction
Consumer:
Construction $ 248,549 $ 152,344 $ 19,615
Land 46,512 40,077 -
Commercial:
Land 317,941 255,050 1,910
Multi-family 154,496 96,156 -
Hotel 76,995 46,644 -
Retail 52,790 26,504 -
Office 39,760 24,249 5,590
Healthcare Facility 38,501 - -
Self-storage 25,940 9,839 -
Recreation, sports and entertainment 23,689 14,059 -
Other 166,743 84,307 351
Residential Development:
Construction 541,045 325,698 3,305
Land 124,452 76,378 -
Lots 69,721 44,087 597
Total $ 1,927,134 $ 1,195,392 $ 31,368
1) Nonperforming loans are those on which the accrual of interest has stopped, as well as loans that are contractually 90 days or more past due on which interest continues to accrue.
Loan maturity and sensitivities
The following table presents the contractual maturities of our loan portfolio as of September 30, 2025. 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, 2025
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 $ 747,330 $ 1,210,264 $ 195,059 $ 2,452 $ 2,155,105
Construction 570,486 514,449 74,482 35,975 1,195,392
Residential real estate:
1-to-4 family mortgage 145,828 558,599 207,899 940,300 1,852,626
Residential line of credit 83,147 120,500 503,656 - 707,303
Multi-family mortgage 158,973 406,926 158,879 11,646 736,424
Commercial real estate:
Owner-occupied 231,972 1,155,362 488,200 249,386 2,124,920
Non-owner occupied 400,427 1,728,686 678,649 82,471 2,890,233
Consumer and other 25,743 92,844 134,882 382,128 635,597
Total ($) $ 2,363,906 $ 5,787,630 $ 2,441,706 $ 1,704,358 $ 12,297,600
Total (%) 19.2 % 47.1 % 19.8 % 13.9 % 100.0 %
For loans due after one year or more, the following table presents the interest rate composition for loans outstanding as of September 30, 2025.
September 30, 2025
Loan type (dollars in thousands) Fixed
interest rate 		Floating
interest rate 		Total
Commercial and industrial $ 513,099 $ 894,676 $ 1,407,775
Construction 161,569 463,337 624,906
Residential real estate:
1-to-4 family mortgage 1,193,889 512,909 1,706,798
Residential line of credit 4,104 620,052 624,156
Multi-family mortgage 298,531 278,920 577,451
Commercial real estate:
Owner-occupied 1,181,311 711,637 1,892,948
Non-owner occupied 1,276,169 1,213,637 2,489,806
Consumer and other 533,267 76,587 609,854
Total ($) $ 5,161,939 $ 4,771,755 $ 9,933,694
Total (%) 52.0 % 48.0 % 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, 2025.
September 30, 2025
Contractual maturity (dollars in thousands) Fixed
interest rate 		Floating
interest rate 		Total
One year or less $ 798,861 $ 1,565,045 $ 2,363,906
One to five years 3,020,673 2,766,957 5,787,630
Five to fifteen years 1,055,850 1,385,856 2,441,706
Over fifteen years 1,085,416 618,942 1,704,358
Total ($) $ 5,960,800 $ 6,336,800 $ 12,297,600
Total (%) 48.5 % 51.5 % 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, 2025 and December 31, 2024, we had $145.2 million and $121.9 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 $0.5 million and $0.1 million for the three months ended September 30, 2025 and 2024, respectively, and $1.9 million and $0.5 million for the nine months ended September 30, 2025 and 2024, respectively. Additionally, we had net interest recoveries on nonperforming assets previously charged off of $0.5 million and $0.1 million for the three months ended September 30, 2025 and 2024, respectively, and $1.4 million and $1.1 million for the nine months ended September 30, 2025 and 2024, respectively.
Nonperforming loans HFI increased by $32.1 million to $115.8 million as of September 30, 2025 compared to $83.7 million as of December 31, 2024. The increase in nonperforming loans primarily occurred in our construction, multi-family and consumer and other portfolios partially offset by a decrease in a our commercial and industrial portfolio.
As of September 30, 2025 and December 31, 2024, we had $21.7 million and $31.4 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.
As of both September 30, 2025 and December 31, 2024, other real estate owned included $0.1 million of excess land and facilities held for sale resulting from our prior acquisitions. Other repossessed assets also included other repossessed non-real estate amounting to $3.3 million and $2.4 million as of September 30, 2025 and December 31, 2024, respectively.
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) 2025 2024 2024
Loan Type:
Commercial and industrial $ 6,926 $ 23,058 $ 10,391
Construction 31,368 11,546 11,453
Residential real estate:
1-to-4 family mortgage 29,445 23,848 27,944
Residential line of credit 2,342 1,558 1,894
Multi-family mortgage 9,325 25 21
Commercial real estate:
Owner-occupied 11,000 8,999 9,645
Non-owner occupied 5,649 6,567 6,179
Consumer and other 19,704 15,234 16,178
Total nonperforming loans HFI $ 115,759 $ 90,835 $ 83,705
Mortgage loans held for sale(1)
21,660 30,537 31,357
Other real estate owned 4,466 3,779 4,409
Other repossessed assets 3,314 2,182 2,444
Total nonperforming assets $ 145,199 $ 127,333 $ 121,915
Nonperforming loans HFI as a percentage of total loans HFI 0.94 % 0.96 % 0.87 %
Nonperforming assets as a percentage of total assets 0.89 % 0.99 % 0.93 %
Nonaccrual loans HFI as a percentage of loans HFI 0.73 % 0.68 % 0.62 %
(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, 2025 and December 31, 2024. 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 $54.6 million at September 30, 2025 as compared to $47.9 million at December 31, 2024. The increase from December 31, 2024 to September 30, 2025 primarily occurred within our non-owner occupied, consumer and other and construction portfolios offset with a decrease in our multi-family portfolio.
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.
Beginning on June 30, 2025, we utilize the discounted cash flow estimation technique, adjusted for current conditions and reasonable and supportable forecasts, to estimate the expected credit losses of its loan segments, except consumer and other loans, which utilize the weighted average remaining maturity loss rate technique. We determined that the use of the updated estimate techniques and related inputs and assumptions enhances the transparency, accuracy and relevance of information relating to its allowance for credit losses through the application of data and calculations more clearly calibrated to our historical experience, the nature of its loan portfolio and unfunded commitments, and expectations for future economic conditions and corresponding expected credit losses. See "Note 1, "Basis of presentation" in this Report for further discussion on the change in estimate. The changes are accounted for as a change in estimate included in the provision for credit losses for the nine months ended September 30, 2025 and did not have a material impact to our operating results and financial condition.
Prior to June 30, 2025, our estimates for credit losses calculation utilized a lifetime loss rate model. See Note 1, "Basis of presentation and summary of significant accounting policies," in the notes to our consolidated financial statements in our Annual Report that was filed with the SEC on February 25, 2025, for additional information regarding our estimates prior to June 30, 2025.
The following table presents the allocation of the allowance for credit losses on loans HFI by loan category as well as the ratio of loans by loan category compared to the total loan portfolio as of the dates indicated:
September 30, December 31,
2025 2024
(dollars in thousands) Amount ACL
as a % of loans HFI category 		Amount ACL
as a % of loans HFI category
Loan Type:
Commercial and industrial $ 26,075 1.21 % $ 16,667 0.99 %
Construction 27,857 2.33 % 31,698 2.91 %
Residential real estate:
1-to-4 family mortgage 33,059 1.78 % 25,340 1.57 %
Residential line of credit 10,458 1.48 % 10,952 1.82 %
Multi-family mortgage 11,815 1.60 % 10,512 1.61 %
Commercial real estate:
Owner-occupied 20,360 0.96 % 11,993 0.88 %
Non-owner occupied 34,073 1.18 % 25,531 1.22 %
Consumer and other 21,296 3.35 % 19,249 3.90 %
Total allowance for credit losses on loans HFI $ 184,993 1.50 % $ 151,942 1.58 %
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) 2025 2024 2025 2024 2024
Allowance for credit losses on loans HFI at beginning
of period 		$ 148,948 $ 155,055 $ 151,942 $ 150,326 $ 150,326
Initial allowance for credit losses on loans purchased with
credit deterioration 		7,518 - 7,518 - -
Charge-offs:
Commercial and industrial (100) (90) (3,071) (159) (11,080)
Construction (399) - (399) (92) (122)
Residential real estate:
1-to-4 family mortgage (322) (2) (758) (295) (439)
Residential line of credit - (53) - (73) (73)
Commercial real estate:
Owner-occupied - - (17) - -
Consumer and other (888) (770) (2,811) (2,136) (3,051)
Total charge-offs $ (1,709) $ (915) $ (7,056) $ (2,755) $ (14,765)
Recoveries:
Commercial and industrial $ 12 $ 23 $ 227 $ 57 $ 428
Residential real estate:
1-to-4 family mortgage 6 9 26 75 84
Residential line of credit 11 18 12 18 18
Commercial real estate:
Owner-occupied 4 12 34 240 245
Non-owner occupied - - 529 - -
Consumer and other 246 202 1,000 651 939
Total recoveries $ 279 $ 264 $ 1,828 $ 1,041 $ 1,714
Net charge-offs (1,430) (651) (5,228) (1,714) (13,051)
Impact of change in accounting estimate for current expected
credit losses(1)
- - (6,848) - -
Provision for credit losses on loans HFI(1)
29,957 1,856 37,609 7,648 14,667
Allowance for credit losses on loans HFI at the end of period $ 184,993 $ 156,260 $ 184,993 $ 156,260 $ 151,942
Ratio of net charge-offs during the period to average loans
outstanding during the period 		(0.05) % (0.03) % (0.07) % (0.02) % (0.14) %
Allowance for credit losses on loans HFI as a percentage of
loans 		1.50 % 1.65 % 1.50 % 1.65 % 1.58 %
Allowance for credit losses on loans HFI as a percentage of
nonaccrual loans HFI 		206.8 % 241.9 % 206.8 % 241.9 % 256.0 %
Allowance for credit losses on loans HFI as a percentage of
nonperforming loans 		159.8 % 172.0 % 159.8 % 172.0 % 181.5 %
(1) We made certain changes to its estimation techniques and certain related inputs and assumptions in its estimates of credit losses as of June 30, 2025. See "Note 1, "Basis of presentation" in this Report for further discussion on the change in estimate. The changes are accounted for as a change in estimate included in the provision for credit losses for the nine months ended September 30, 2025 and did not have a material impact to our operating results and financial condition.
The following tables details our provision for (reversal of) credit losses on loans HFI and net (charge-offs) recoveries to average loans HFI outstanding by loan category during the periods indicated:
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)
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) %
Three months ended September 30, 2024
Commercial and industrial $ 1,670 $ (67) $ 1,640,508 (0.02) %
Construction (3,612) - 1,143,612 - %
Residential real estate:
1-to-4 family mortgage 341 7 1,594,875 - %
Residential line of credit 662 (35) 573,962 (0.02) %
Multi-family mortgage 834 - 617,951 - %
Commercial real estate:
Owner-occupied 243 12 1,287,095 - %
Non-owner occupied 98 - 2,045,146 - %
Consumer and other 1,620 (568) 459,788 (0.49) %
Total $ 1,856 $ (651) $ 9,362,937 (0.03) %
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) %
Nine Months Ended September 30, 2024
Commercial and industrial $ 4,636 $ (102) $ 1,646,771 (0.01) %
Construction (4,722) (92) 1,231,310 (0.01) %
Residential real estate:
1-to-4 family mortgage (306) (220) 1,581,697 (0.02) %
Residential line of credit 1,311 (55) 554,235 (0.01) %
Multi-family mortgage 802 - 621,897 - %
Commercial real estate:
Owner-occupied 674 240 1,257,455 0.03 %
Non-owner occupied 1,676 - 2,007,605 - %
Consumer and other 3,577 (1,485) 436,972 (0.45) %
Total $ 7,648 $ (1,714) $ 9,337,942 (0.02) %
Provision for (reversal of) credit losses on loans HFI(1)
Net (charge-offs) recoveries Average loans HFI Ratio of (charge-offs) net recoveries to average loans HFI
(dollars in thousands)
Year Ended December 31, 2024
Commercial and industrial $ 7,720 $ (10,652) $ 1,655,250 (0.64) %
Construction (3,552) (122) 1,199,414 (0.01) %
Residential real estate:
1-to-4 family mortgage (810) (355) 1,587,111 (0.02) %
Residential line of credit 1,539 (55) 562,877 (0.01) %
Multi-family mortgage 1,670 - 629,920 - %
Commercial real estate:
Owner occupied 1,095 245 1,278,683 0.02 %
Non-owner occupied 2,566 - 2,021,677 - %
Consumer and other 4,439 (2,112) 449,526 (0.47) %
Total $ 14,667 $ (13,051) $ 9,384,458 (0.14) %
(1) We made certain changes to its estimation techniques and certain related inputs and assumptions in its estimates of credit losses as of June 30, 2025. See "Note 1, "Basis of presentation" in this Report for further discussion on the change in estimate. The changes are accounted for as a change in estimate included in the provision for credit losses for the nine months ended September 30, 2025 and did not have a material impact to our operating results and financial condition.
The ACL on loans HFI was $185.0 million and $151.9 million and represented 1.50% and 1.58% of loans HFI as of September 30, 2025 and December 31, 2024, respectively. For further information related to the change in the ACL refer to "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.
For the three months ended September 30, 2025 and 2024, we experienced net charge-offs of $1.4 million and $0.7 million, respectively, or 0.05% and 0.03% of average loans HFI, respectively. For the nine months ended September 30, 2025, we experienced net charge-offs of $5.2 million, or 0.07% of average loans HFI, compared to net charge-offs of $1.7 million, or 0.02% for the nine months ended September 30, 2024. Our ratio of total nonperforming loans HFI as a percentage of total loans HFI increased by 7 basis points to 0.94% as of September 30, 2025 compared to December 31, 2024 primarily due to increases in nonperforming loans in our construction, multi-family and consumer and other portfolios partially offset by a decrease in a our commercial and industrial portfolio.
We also maintain an allowance for credit losses on unfunded commitments in other liabilities, which increased to $17.4 million as of September 30, 2025 from $6.1 million as of December 31, 2024 due primarily to the change in CECL loss estimation methodology and the initial provision from unfunded commitments acquired in the Southern States merger.
Loans held for sale
Mortgage loans held for sale consisted of $145.8 million of residential real estate mortgage loans in the process of being sold to third-party private investors or government sponsored agencies and $21.7 million of GNMA optional repurchase loans. This compares to $95.4 million of residential real estate mortgage loans in the process of being sold to third-party private investors or government sponsored agencies and $31.4 million of GNMA optional repurchase loans as of December 31, 2024.
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 were $13.81 billion and $11.21 billion as of September 30, 2025 and December 31, 2024, respectively. The increase stemmed from $2.47 billion of deposits assumed in the Southern States merger.
Noninterest-bearing deposits at September 30, 2025 and December 31, 2024 were $2.69 billion and $2.12 billion, respectively. We assumed $562.5 million of noninterest-bearing deposits in the Southern States merger. Additionally, noninterest bearing deposits include mortgage escrow deposits which increased to $131.6 million as of September 30, 2025 from $69.0 million as of December 31, 2024.
Our interest-bearing deposits were $11.12 billion and $9.09 billion at September 30, 2025 and December 31, 2024, respectively. The increase was attributable to $1.91 billion of deposits assumed in the Southern States merger.
Interest-bearing checking deposits decreased to $2.46 billion at September 30, 2025 as compared to $2.91 billion at December 31, 2024. The decrease was the result of management's effort to manage down higher cost deposits.
Money market and savings deposits accounts increased by $1.63 billion million from December 31, 2024 primarily due to the merger with Southern States and a promotional rate campaign targeting new and existing customers and commercial account growth across our footprint.
Customer time deposits increased by $826.6 million from December 31, 2024, driven by the merger with Southern States and a $250.0 million short-term public funds time deposit.
Additionally, brokered and internet time deposits increased by $19.7 million to $488.8 million as of September 30, 2025 compared to December 31, 2024. This growth was a product of our liquidity management strategy.
We have experienced a decrease in our cost of interest-bearing deposits due to a decrease in the 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 18, "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,
2025 2024
(dollars in thousands) Amount % of total deposits
Average rate(1)
Amount % of total deposits
Average rate(1)
Deposit Type
Noninterest-bearing demand $ 2,690,635 19 % - % $ 2,116,232 19 % - %
Interest-bearing checking 2,458,625 18 % 2.43 % 2,906,425 26 % 3.05 %
Money market 5,557,519 40 % 3.45 % 3,986,777 36 % 3.84 %
Savings deposits 410,575 3 % 0.15 % 351,706 3 % 0.07 %
Customer time deposits 2,206,790 16 % 3.70 % 1,380,205 12 % 3.97 %
Brokered and internet time deposits 488,811 4 % 4.32 % 469,089 4 % 4.86 %
Total deposits $ 13,812,955 100 % 2.52 % $ 11,210,434 100 % 2.76 %
Customer Time Deposits(2)
0.00-1.00% $ 95,771 4 % $ 65,302 5 %
1.01-2.00% 55,467 3 % 63,582 5 %
2.01-3.00% 203,240 9 % 74,171 5 %
3.01-4.00% 691,525 31 % 264,863 19 %
4.01-5.00% 1,157,569 53 % 875,916 63 %
Above 5.00% 3,218 - % 36,371 3 %
Total customer time deposits $ 2,206,790 100 % $ 1,380,205 100 %
Brokered and Internet Time Deposits(2)
0.00-1.00% $ - - % $ - - %
1.01-2.00% - - % - - %
2.01-3.00% - - % - - %
3.01-4.00% 326,909 67 % 169,088 36 %
4.01-5.00% 155,956 32 % 199,888 43 %
Above 5.00% 5,946 1 % 100,113 21 %
Total brokered and internet time deposits $ 488,811 100 % $ 469,089 100 %
Total time deposits $ 2,695,601 $ 1,849,294
(1) Average rates presented for the nine months ended September 30, 2025 and the year ended December 31, 2024, respectively.
(2) Based on rates presented as of period-end.
Further details related to our deposit customer base is presented below as of the dates indicated:
September 30, December 31,
2025 2024
(dollars in thousands) Amount % of total deposits Amount % of total deposits
Deposits by customer segment(1)
Consumer $ 5,966,458 43 % $ 4,853,609 43 %
Commercial 6,045,418 44 % 4,802,105 43 %
Public 1,801,079 13 % 1,554,720 14 %
Total deposits $ 13,812,955 100 % $ 11,210,434 100 %
(1) Segments are determined based on the customer account level.
The tables below set forth maturity information on time deposits and amounts in excess of the FDIC insurance limit as of September 30, 2025:
(dollars in thousands) Amount Weighted average interest rate at period end
Time deposits of $250 and less
Months to maturity:
Three or less $ 588,639 3.87 %
Over Three to Six 441,555 3.79 %
Over Six to Twelve 449,747 3.66 %
Over Twelve 277,272 3.25 %
Total $ 1,757,213 3.70 %
Time deposits of greater than $250
Months to maturity:
Three or less $ 461,104 4.07 %
Over Three to Six 206,989 3.95 %
Over Six to Twelve 167,731 3.80 %
Over Twelve 102,564 3.38 %
Total $ 938,388 3.92 %
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 is presented below as of the dates indicated:
September 30, December 31,
2025 2024
Estimated insured or collateralized deposits(1)
$ 9,871,337 $ 8,346,796
Estimated uninsured and uncollateralized deposits(1)
$ 3,941,618 $ 2,863,638
Estimated uninsured and uncollateralized deposits as a % of total deposits(1)
28.5 % 25.5 %
Estimated uninsured deposits(2)
$ 5,756,466 $ 4,478,898
(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.
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 $62.1 million and $61.1 million at September 30, 2025 and December 31, 2024, respectively.
Federal funds sold
Federal funds may fluctuate from period to period depending upon our liquidity position at the time and our strategy for deploying liquidity. Federal funds sold totaled $221.3 million and $64.8 million at September 30, 2025 and December 31, 2024, 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 $1.43 billion and $1.54 billion as of September 30, 2025 and December 31, 2024, respectively. Included in the fair value of AFS debt securities were net unrealized losses of $55.9 million and $141.4 million as of September 30, 2025 and December 31, 2024, 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, 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 million of mortgage-backed 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.
During the three months ended September 30, 2024, we sold $318.5 million of AFS debt securities with a weighted average yield of 2.25% and reinvested the proceeds of the sales into AFS securities with a weighted average yield of 5.25%. The sales resulted in a loss on securities of $40.2 million. We primarily sold low yielding mortgage-backed securities and municipal securities. Including the reinvestment of these proceeds into higher yielding U.S. government agency and mortgage-backed securities, we purchased $457.4 million of AFS debt securities during the three months ended September 30, 2024. Maturities, prepayments and calls of AFS debt securities totaled $89.9 million for the three months ended September 30, 2024.
During the nine months ended September 30, 2024, we sold $526.4 million of AFS debt securities, resulting in a loss on securities of $56.4 million. We primarily sold fixed rate, deeply discounted mortgage bonds and low yielding municipal bonds and reinvested the proceeds into U.S. government agency AFS debt securities and a blend of fixed and floating rate securities to achieve the best accretion profile for the Bank. Including the reinvestment of these proceeds, we purchased $824.0 million of AFS debt securities during the nine months ended September 30, 2024. Maturities, prepayments and calls of AFS debt securities totaled $224.1 million for the nine months ended September 30, 2024.
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,
2025 2024
(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 301,775 21.1 % 4.75 % 207,220 13.5 % 5.28 %
Maturing after ten years 351,422 24.6 % 4.92 % 355,787 23.1 % 5.47 %
Total U.S. government agency securities 653,197 45.7 % 4.84 % 563,007 36.6 % 5.40 %
Mortgage-backed securities - residential and commercial:
Maturing within one year 1 - % 4.92 % 2,222 0.1 % 3.35 %
Maturing in one to five years 2,189 0.2 % 7.53 % 343 - % 2.16 %
Maturing in five to ten years 8,810 0.6 % 3.13 % 13,424 0.9 % 2.73 %
Maturing after ten years 587,268 41.2 % 4.00 % 809,867 52.8 % 3.10 %
Total mortgage-backed securities - residential and commercial 598,268 42.0 % 4.00 % 825,856 53.8 % 3.09 %
Municipal securities:
Maturing within one year 203 - % 2.81 % 548 - % 4.26 %
Maturing in one to five years 5,681 0.4 % 3.82 % 3,611 0.2 % 3.56 %
Maturing in five to ten years 39,911 2.8 % 3.56 % 15,723 1.0 % 3.06 %
Maturing after ten years 119,616 8.4 % 3.02 % 127,975 8.3 % 2.93 %
Total municipal securities 165,411 11.6 % 3.17 % 147,857 9.5 % 2.96 %
U.S. Treasury securities:
Maturing within one year - - % - % 299 - % 4.25 %
Maturing in one to five years 5,769 0.4 % 3.71 % - - % - %
Maturing in five to ten years 1,311 0.1 % 3.81 % - - % - %
Maturing after ten years - - % - % - - % - %
Total U.S. Treasury securities 7,080 0.5 % 3.73 % 299 - % 4.25 %
Corporate securities:
Maturing within one year - - % - % - - % - %
Maturing in one to five years 2,995 0.2 % 6.46 % 989 0.1 % 7.98 %
Maturing in five to ten years - - % - % - - % - %
Maturing after ten years - - % - % - - % - %
Total corporate securities 2,995 0.2 % 6.46 % 989 0.1 % 7.98 %
Total AFS debt securities $ 1,426,951 100.0 % 4.29 % $ 1,538,008 100.0 % 3.93 %
(1)Yields on a tax-equivalent basis.
Equity securities
As of September 30, 2025, we had $1.5 million in marketable equity securities recorded at fair value that were acquired through our merger with Southern States. The change in the fair value of equity securities recorded at fair value resulted in a net gain of $12 thousand for both the three and nine months ended September 30, 2025.
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 borrowing can fluctuate on a daily basis depending on funding needs and the sources of funds to satisfy those needs, in addition to 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 $12.5 million and $13.5 million at September 30, 2025 and December 31, 2024, 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 $95.0 million as of September 30, 2025 with a weighted average rate of 4.77%. There were no such borrowings as of December 31, 2024.
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, 2025 and December 31, 2024 had total borrowing capacity of $1.55 billion and $1.40 billion, respectively. As of September 30, 2025 and December 31, 2024, we had qualifying loans pledged as collateral securing these lines amounting to $2.71 billion and $2.61 billion, respectively. There were no FHLB advances outstanding as of September 30, 2025 or December 31, 2024.
Subordinated debt
Prior to September 30, 2025, we had issued junior subordinated debentures through two separate trusts which issued floating rate trust preferred securities to external investors. The trusts were created for the sole purpose of issuing 30-year capital trust preferred securities to fund the purchase of the junior subordinated debentures. In September 2025, we redeemed notes related to these trusts at the principal amount plus accrued and unpaid interest pursuant to the terms of the debentures. As a result of this redemption, we redeemed $30.9 million of junior subordinated debentures.
Separately, during September 2025, the Bank redeemed $100.0 million of ten-year fixed-to-floating rate subordinated notes. This redemption was executed 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. As of September 30, 2025, no other subordinated debt remained outstanding apart from the debt assumed through this business combination.
Further details regarding our subordinated debt as of September 30, 2025 are provided below.
(dollars in thousands) Year established Maturity Call date Total debt outstanding Interest rate Coupon structure
February 2032 Subordinated Debt(1)
2022 02/07/2032 02/07/2027 $ 47,500 3.50%
Quarterly fixed(2)
October 2032 Subordinated Debt(1)
2022 10/26/2032
10/26/2027
40,000 7.00%
Quarterly fixed(2)
December 2031 Subordinated Debt(1)
2021 12/22/2031
12/31/2026
5,000 3.50%
Quarterly fixed(2)
Unamortized fair value marks (9,162)
Total subordinated debt, net $ 83,338
(1) The Company classifies the issuance, net of unamortized fair value marks, as Tier 2 capital, which will be phased out 20% per year in the final five years before maturity.
(2) Beginning on respective call date, the coupon structure migrates to 3M SOFR plus a spread of 205 basis points, 306 basis points and 242 basis points for the February 2032, October 2032 and December 2031 subordinated issues, respectively, through the end of the term of each debenture.
Other borrowings
Other borrowings include our finance lease liability totaling $1.2 million as of both September 30, 2025 and December 31, 2024. Additionally, other borrowings include optional rights to repurchase GNMA loans previously sold that meet certain defined delinquency criteria and are eligible for repurchase totaling $21.7 million and $31.4 million as of September 30, 2025 and December 31, 2024, respectively. See Note 7, "Leases" and Note 13, "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.
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, 2025 and December 31, 2024, we had pledged securities with carrying values of $818.2 million and $937.0 million, respectively.
Additional sources of liquidity include federal funds purchased, repurchase agreements, FHLB borrowings and lines of credit. Interest is charged at the prevailing market rate on federal funds purchased, reverse repurchase agreements and FHLB advances. 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, 2025 or December 31, 2024. As of September 30, 2025, we had the ability to borrow $1.55 billion through FHLB advances with remaining capacity of $1.55 billion. As of December 31, 2024, there was $1.40 billion available to borrow against with a remaining capacity of $1.40 billion.
We also maintained unsecured lines of credit with other commercial banks totaling $405.0 million and $370.0 million as of September 30, 2025 and December 31, 2024, respectively. 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 $95.0 million as of September 30, 2025. There were no such borrowings as of December 31, 2024. As of both September 30, 2025 and December 31, 2024, 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) 2025 2024
Current on-balance sheet liquidity:
Cash and cash equivalents $ 1,280,033 $ 1,042,488
Unpledged AFS debt securities 608,716 600,965
Equity securities, at fair value 1,450 -
Total on-balance sheet liquidity $ 1,890,199 $ 1,643,453
Available sources of liquidity:
Unsecured borrowing capacity(1)
$ 4,018,822 $ 3,318,091
FHLB remaining borrowing capacity 1,551,283 1,397,905
Federal Reserve discount window 2,196,785 2,053,541
Total available sources of liquidity $ 7,766,890 $ 6,769,537
On-balance sheet liquidity as a percentage of total assets 11.6 % 12.5 %
On-balance sheet liquidity and available sources of liquidity as a percentage of estimated
uninsured and uncollateralized deposits(2)
245.0 % 293.8 %
(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, 2024.
Due to state banking laws, 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. Based upon this regulation, as of September 30, 2025 and December 31, 2024, $76.3 million and $185.9 million of the Bank's retained earnings were available for the payment of dividends without such prior approval. 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. 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. During the three and nine months ended September 30, 2024, there were $9.0 million and $37.5 million in cash dividends approved by the board for payment from the Bank to the holding company. Additionally, an asset dividend of an equity security amounting to $1.7 million was paid from the Bank to the holding company during the nine months ended September 30, 2024. None of these required approval from the TDFI. Subsequent to September 30, 2025, the Board approved a dividend from the Bank to the holding company to be paid in the fourth quarter for $10.3 million that also did not require approval from the TDFI.
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. During the three and nine months ended September 30, 2024, the Company declared shareholder dividends of $0.17 per share, or $8.0 million and 0.51 per share, or $24.1 million, respectively. Subsequent to September 30, 2025, the Company declared a quarterly dividend in the amount of $0.19 per share, payable on November 25, 2025, to stockholders of record as of November 11, 2025.
Shareholders' equity and capital management
Our total shareholders' equity was $1.98 billion and $1.57 billion as of September 30, 2025 and December 31, 2024, respectively. The increase in shareholders' equity was primarily attributable to the $368.0 million of common stock issued in connection with our merger with Southern States, net income of $65.6 million and a $44.8 million unrealized loss reclassification adjustment for loss on sale of securities included in net income, net of tax benefit. This increase was partially offset by dividends declared of $28.0 million and stock repurchases of $68.0 million. Book value per common share was $37.00 as of September 30, 2025 and $33.59 as of December 31, 2024.
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, 2025 and December 31, 2024, we met all capital adequacy requirements for which we were subject. See additional discussion regarding our capital adequacy and ratios within Note 15, "Minimum capital requirements" in the notes to our consolidated financial statements contained herein.
September 30, 2025 FB Financial Corporation FirstBank
To be Well-Capitalized(1)
Total risk-based capital 13.6 % 13.3 % 10.0 %
Tier 1 risk-based capital 11.7 % 12.0 % 8.0 %
Common Equity Tier 1 ratio 11.7 % 12.0 % 6.5 %
Tier 1 leverage 10.6 % 10.8 % 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 07, 2025, and is solely responsible for the information contained herein. Distributed via Edgar on November 07, 2025 at 19:57 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]