<span item_type="fundamental" item_id="104c0a0267c50d85ebbcbf8158c5ecd1" counter_id="ST/US/FBIZ" env="prod"></span><span item_type="announcement" item_id="610338259053904897" env="prod"></span><p>Revenue: As of FY2025 Q4, the actual value is USD 42.22 M.</p><p>EPS: As of FY2025 Q4, the actual value is USD 1.58, beating the estimate of USD 1.392.</p><p>EBIT: As of FY2025 Q4, the actual value is USD -18.52 M.</p><p></p><p>First Business Financial Services, Inc. released its earnings for the quarter ended December 31, 2025, and declared a quarterly cash dividend on its common stock and 7% series A preferred stock on January 29, 2026 <span class="superscript" item_id="0" item_type="announcement_file" value="1" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-20260129.htm"></span>.</p><h4>Net Income</h4><p>Net income available to common shareholders for the fourth quarter of 2025 was $13.1 million, compared to $14.2 million in the third quarter of 2025 and $14.2 million in the fourth quarter of 2024 <span class="superscript" item_id="0" item_type="announcement_file" value="2" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_1.htm"></span>. For the full year 2025, net income available to common shareholders was $49.444 million, up from $43.370 million in 2024 <span class="superscript" item_id="0" item_type="announcement_file" value="2" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_1.htm"></span>. Net income saw a 14% annual growth for the full year 2025 <span class="superscript" item_id="0" item_type="announcement_file" value="3" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_2.htm"></span>.</p><h4>Operating Revenue</h4><p>Operating revenue for the fourth quarter of 2025 was $42.223 million, compared to $44.292 million in the third quarter of 2025 and $41.153 million in the fourth quarter of 2024 <span class="superscript" item_id="0" item_type="announcement_file" value="2" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_1.htm"></span>. For the full year 2025, operating revenue was $168.393 million, an increase from $153.465 million in 2024 <span class="superscript" item_id="0" item_type="announcement_file" value="2" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_1.htm"></span>. Operating Revenue increased by 10% year-over-year <span class="superscript" item_id="0" item_type="announcement_file" value="3" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_2.htm"></span>. Diverse sources of non-interest income, including service fees from the Private Wealth Management business, comprised 46% of year-to-date total non-interest income <span class="superscript" item_id="0" item_type="announcement_file" value="3" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_2.htm"></span>.</p><h4>Net Interest Income</h4><p>Net interest income for the fourth quarter of 2025 was $34.762 million, a 0.4% decrease from $34.886 million in the third quarter of 2025, but a 4.9% increase from $33.148 million in the fourth quarter of 2024 <span class="superscript" item_id="0" item_type="announcement_file" value="2" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_1.htm"></span>. For the full year 2025, net interest income was $136.690 million, up from $124.206 million in 2024 <span class="superscript" item_id="0" item_type="announcement_file" value="2" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_1.htm"></span>.</p><h4>Adjusted Non-Interest Income</h4><p>Adjusted non-interest income was $7.461 million in the fourth quarter of 2025, compared to $9.406 million in the third quarter of 2025 and $8.005 million in the fourth quarter of 2024 <span class="superscript" item_id="0" item_type="announcement_file" value="2" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_1.htm"></span>. For the full year 2025, adjusted non-interest income was $31.703 million, compared to $29.259 million in 2024 <span class="superscript" item_id="0" item_type="announcement_file" value="2" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_1.htm"></span>.</p><h4>Pre-Tax, Pre-Provision Adjusted Earnings</h4><p>Pre-tax, pre-provision adjusted earnings were $18.322 million for the fourth quarter of 2025, compared to $18.852 million in the third quarter of 2025 and $17.719 million in the fourth quarter of 2024 <span class="superscript" item_id="0" item_type="announcement_file" value="2" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_1.htm"></span>. For the full year 2025, these earnings were $69.410 million, an increase from $60.449 million in 2024 <span class="superscript" item_id="0" item_type="announcement_file" value="2" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_1.htm"></span>. Pre-tax, pre-provision (PTPP) earnings showed a 15% annual growth for the full year 2025 <span class="superscript" item_id="0" item_type="announcement_file" value="3" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_2.htm"></span>.</p><h4>Operating Expense</h4><p>Operating expense for the fourth quarter of 2025 was $23.901 million, a decrease of 6.0% from $25.440 million in the third quarter of 2025, and an increase of 2.0% from $23.434 million in the fourth quarter of 2024 <span class="superscript" item_id="0" item_type="announcement_file" value="2" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_1.htm"></span>. For the full year 2025, operating expense was $98.983 million, compared to $93.016 million in 2024 <span class="superscript" item_id="0" item_type="announcement_file" value="2" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_1.htm"></span>.</p><h4>Efficiency Ratio</h4><p>The Company’s efficiency ratio improved to 56.61% in the fourth quarter of 2025, from 57.44% in the linked quarter and 56.94% in the prior-year quarter <span class="superscript" item_id="0" item_type="announcement_file" value="2" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_1.htm"></span>. The full-year efficiency ratio for 2025 was 58.78%, down from 60.61% in 2024 <span class="superscript" item_id="0" item_type="announcement_file" value="2" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_1.htm"></span>. The efficiency ratio improved to 56.61% for Q4 2025, and for the full year, it was 58.78%, compared to 60.61% for 2024, indicating positive operating leverage for the fourth consecutive year <span class="superscript" item_id="0" item_type="announcement_file" value="3" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_2.htm"></span>.</p><h4>Net Interest Margin (NIM)</h4><p>Net interest margin was 3.53% in the fourth quarter of 2025, including a 10 basis point impact from non-accrual interest reversals <span class="superscript" item_id="0" item_type="announcement_file" value="2" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_1.htm"></span>. Excluding this impact, NIM was 3.63%, compared to 3.68% for the linked quarter and 3.77% for the prior-year quarter <span class="superscript" item_id="0" item_type="announcement_file" value="2" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_1.htm"></span>. The full-year NIM for 2025 was 3.64%, compared to 3.66% in 2024 <span class="superscript" item_id="0" item_type="announcement_file" value="2" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_1.htm"></span>. Net interest margin was 3.53% for Q4 2025, which included a -10 basis point impact from non-accrual interest reversals <span class="superscript" item_id="0" item_type="announcement_file" value="3" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_2.htm"></span>. Excluding this item, the net interest margin was 3.63%, compared to 3.68% in the linked quarter <span class="superscript" item_id="0" item_type="announcement_file" value="3" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_2.htm"></span>.</p><h4>Core Deposits</h4><p>Period-end core deposits increased by $80.9 million, or 12.5% annualized, from the third quarter of 2025, reaching $2.673 billion <span class="superscript" item_id="0" item_type="announcement_file" value="2" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_1.htm"></span>. This also represents an increase of $276.6 million, or 11.5%, from the fourth quarter of 2024 <span class="superscript" item_id="0" item_type="announcement_file" value="2" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_1.htm"></span>. Core deposits grew 12.5% annualized from the linked quarter and 11.5% from Q4 2024 <span class="superscript" item_id="0" item_type="announcement_file" value="3" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_2.htm"></span>. The core deposit funding mix improved to 74.7% in the fourth quarter of 2025, up from 71.5% in the linked quarter and 70.7% in the fourth quarter of 2024 <span class="superscript" item_id="0" item_type="announcement_file" value="2" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_1.htm"></span>. The core deposit funding mix improved to 74.7% from 71.5% in the linked quarter <span class="superscript" item_id="0" item_type="announcement_file" value="3" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_2.htm"></span>.</p><h4>Loans and Leases Receivable</h4><p>Total period-end loans and leases receivable increased by $38.6 million, or 4.6% annualized, from the third quarter of 2025, reaching $3.373 billion <span class="superscript" item_id="0" item_type="announcement_file" value="2" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_1.htm"></span>. This marks an increase of $261.4 million, or 8.4%, from the fourth quarter of 2024 <span class="superscript" item_id="0" item_type="announcement_file" value="2" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_1.htm"></span>. Loans grew 4.6% annualized from the linked quarter and 8.4% year-over-year <span class="superscript" item_id="0" item_type="announcement_file" value="3" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_2.htm"></span>. When normalized for above-average payoffs, full year 2025 total loan growth was 11% <span class="superscript" item_id="0" item_type="announcement_file" value="3" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_2.htm"></span>. The 3-year Loan CAGR for Commercial &amp; Industrial (C&amp;I) was 18%, while for Commercial Real Estate (CRE) &amp; Other it was 10% <span class="superscript" item_id="0" item_type="announcement_file" value="3" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_2.htm"></span>.</p><h4>Provision for Credit Losses</h4><p>Provision for credit losses was $1.855 million in the fourth quarter of 2025, compared to $1.440 million in the third quarter of 2025 and $2.701 million in the fourth quarter of 2024 <span class="superscript" item_id="0" item_type="announcement_file" value="2" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_1.htm"></span>. For the full year 2025, provision for credit losses was $8.655 million, compared to $8.827 million in 2024 <span class="superscript" item_id="0" item_type="announcement_file" value="2" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_1.htm"></span>.</p><h4>Non-Performing Assets</h4><p>Non-performing assets increased to $43.855 million, or 1.07% of total assets, in the fourth quarter of 2025, compared to $23.513 million, or 0.58% of total assets, in the prior quarter <span class="superscript" item_id="0" item_type="announcement_file" value="2" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_1.htm"></span>. This increase was primarily due to the downgrade of $20.4 million of commercial real estate (CRE) loans from a single client relationship <span class="superscript" item_id="0" item_type="announcement_file" value="2" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_1.htm"></span>. In Q4 2025, $20.4 million of CRE loans related to a single Wisconsin-based borrower were downgraded <span class="superscript" item_id="0" item_type="announcement_file" value="3" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_2.htm"></span>.</p><h4>Tangible Book Value Per Share (TBVPS)</h4><p>Tangible book value per share saw a 15.9% annualized increase compared to the linked quarter and a 13.7% increase compared to the prior-year quarter, reaching $41.75 at December 31, 2025 <span class="superscript" item_id="0" item_type="announcement_file" value="2" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_1.htm"></span>. Tangible book value per share grew 15.9% annualized from the linked quarter and 13.7% from Q4 2024 <span class="superscript" item_id="0" item_type="announcement_file" value="3" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_2.htm"></span>.</p><h4>Dividends</h4><p>First Business Financial Services, Inc. announced a 17% increase in its quarterly cash dividend to $0.34 per share, marking the 14th consecutive annual increase <span class="superscript" item_id="0" item_type="announcement_file" value="2" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_1.htm"></span>. This dividend is payable on February 28, 2026, to shareholders of record on February 14, 2026 <span class="superscript" item_id="0" item_type="announcement_file" value="2" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_1.htm"></span>. The quarterly cash dividend was increased by 17% to $0.34 per share, marking the 14th consecutive annual increase <span class="superscript" item_id="0" item_type="announcement_file" value="3" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_2.htm"></span>.</p><h4>Credit Quality</h4><p>The company’s average loss rate since 2005 is approximately one-third of the industry rate <span class="superscript" item_id="0" item_type="announcement_file" value="3" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_2.htm"></span>. As of December 31, 2025, 92% of the loan portfolio was classified in category I(1) and 99% of loans were current <span class="superscript" item_id="0" item_type="announcement_file" value="3" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_2.htm"></span>. Performing loans for the full year 2025 were 99.4% current, with 0.5% 30-59 days past due <span class="superscript" item_id="0" item_type="announcement_file" value="3" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_2.htm"></span>.</p><h4>Liquidity</h4><p>Readily accessible liquidity was $1,389,586 thousand as of December 31, 2025, up from $882,785 thousand as of December 31, 2024 <span class="superscript" item_id="0" item_type="announcement_file" value="3" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_2.htm"></span>. Total liquidity was $2,210,437 thousand as of December 31, 2025, compared to $1,909,248 thousand as of December 31, 2024 <span class="superscript" item_id="0" item_type="announcement_file" value="3" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_2.htm"></span>. Total deposits as of December 31, 2025, were $3,380,415 thousand, with 66% being insured or collateralized <span class="superscript" item_id="0" item_type="announcement_file" value="3" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_2.htm"></span>.</p><h4>Portfolio Composition (as of 12/31/25)</h4><p>60% of the loan portfolio was floating rate, totaling $2.000 billion, comprising $1.560 billion in SOFR-indexed loans and $440 million in Prime-indexed loans <span class="superscript" item_id="0" item_type="announcement_file" value="3" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_2.htm"></span>. The remaining 40% was fixed rate <span class="superscript" item_id="0" item_type="announcement_file" value="3" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_2.htm"></span>. Corresponding deposits included $792 million in SOFR-indexed deposits and $1.217 billion in managed rate, non-maturity deposits, totaling $2.009 billion <span class="superscript" item_id="0" item_type="announcement_file" value="3" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_2.htm"></span>.</p><h4>Outlook / Guidance</h4><p>First Business Financial Services, Inc. aims for continued double-digit growth and expects disciplined expense management and balanced revenue growth to support positive operating leverage <span class="superscript" item_id="0" item_type="announcement_file" value="2" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_1.htm"></span>. The Company maintains a long-term target for net interest margin in the range of 3.60% to 3.65% and anticipates an effective tax rate between 16% and 18% for 2026 <span class="superscript" item_id="0" item_type="announcement_file" value="2" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_1.htm"></span>. The strategic goals for 2024-2028 include a Return on Average Tangible Common Equity (ROATCE) of ≥15% by 2028, Tangible Book Value (TBV) growth of ≥10% per year, annual revenue growth of ≥10%, an efficiency ratio of &lt;60% by 2028, and core deposits to total funding of ≥75% <span class="superscript" item_id="0" item_type="announcement_file" value="3" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_2.htm"></span>. The overall goal is 10% annual deposit and loan growth <span class="superscript" item_id="0" item_type="announcement_file" value="3" url="https://www.sec.gov/Archives/edgar/data/1521951/000119312526029321/fbiz-ex99_2.htm"></span>.</p>

First Business Financial | 8-K: FY2025 Q4 Revenue: USD 42.22 M