NASHVILLE, Tenn.--(BUSINESS WIRE)---- $FBK--FB Financial Corporation ("the Company†) (NYSE: FBK), the parent company of FirstBank, announced today that its Board of Directors authorized the repurchase of up to $150 million of the Company's outstanding common stock. The repurchase authorization will be in place until January 31, 2027, and replaces the Company's previous authorization, which was to expire on January 31, 2026. "This repurchase authorization reflects the Company's financial strength and str. ...

[PART I. FINANCIAL INFORMATION](index=3&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) This part presents the company's unaudited consolidated financial statements, management's discussion and analysis, and disclosures on market risk and internal controls [Glossary Of Abbreviations And Acronyms](index=3&type=section&id=Glossary%20Of%20Abbreviations%20And%20Acronyms) This section provides a glossary of abbreviations and acronyms used throughout the Quarterly Report on Form 10-Q to aid reader comprehension - The glossary defines common acronyms and abbreviations used in the report, such as **ACL** (Allowance for credit losses), **AFS** (Available-for-sale), **CECL** (Current expected credit losses), **FHLB** (Federal Home Loan Bank), **NIM** (Net interest margin), and **ROAA** (Return on average assets)[10](index=10&type=chunk)[11](index=11&type=chunk) [Item 1. Consolidated Financial Statements](index=4&type=section&id=Item%201.%20Consolidated%20Financial%20Statements) This section presents the unaudited consolidated financial statements of FB Financial Corporation for the periods ended June 30, 2025, and December 31, 2024 [Consolidated Balance Sheets](index=4&type=section&id=Consolidated%20Balance%20Sheets%20as%20of%20June%2030%2C%202025%20(Unaudited)%20and%20December%2031%2C%202024) The balance sheets detail the company's assets, liabilities, and shareholders' equity as of June 30, 2025, and December 31, 2024 **Consolidated Balance Sheets (Amounts in thousands)** | Item | June 30, 2025 (Unaudited) | December 31, 2024 | | :--- | :--- | :--- | | **ASSETS** | | | | Cash and cash equivalents | $1,165,729 | $1,042,488 | | Available-for-sale debt securities | $1,337,565 | $1,538,008 | | Loans held for investment, net | $9,725,334 | $9,450,442 | | Total assets | $13,354,238 | $13,157,482 | | **LIABILITIES** | | | | Total deposits | $11,403,470 | $11,210,434 | | Total liabilities | $11,743,015 | $11,589,851 | | **SHAREHOLDERS' EQUITY** | | | | Total equity | $1,611,223 | $1,567,631 | - **Total assets increased by $196.76 million** from December 31, 2024, to June 30, 2025, primarily driven by an increase in net loans held for investment and cash and cash equivalents, partially offset by a decrease in available-for-sale debt securities[12](index=12&type=chunk) - **Total deposits increased by $193.04 million**, and total shareholders' equity increased by $43.59 million during the same period[12](index=12&type=chunk) [Consolidated Statements of Income](index=5&type=section&id=Consolidated%20Statements%20of%20Income%20(Unaudited)%20for%20the%20three%20and%20six%20months%20ended%20June%2030%2C%202025%20and%202024) The income statements present the company's revenues, expenses, and net income for the three and six months ended June 30, 2025 and 2024 **Consolidated Statements of Income (Amounts in thousands, except per share amounts)** | Item | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Total interest income | $182,084 | $177,413 | $361,790 | $353,541 | | Total interest expense | $70,669 | $74,798 | $142,734 | $151,436 | | Net interest income | $111,415 | $102,615 | $219,056 | $202,105 | | Net interest income after provision for credit losses | $106,078 | $100,391 | $211,427 | $199,099 | | Total noninterest (loss) income | $(34,552) | $25,608 | $(11,520) | $33,570 | | Total noninterest expense | $81,261 | $75,093 | $160,810 | $147,513 | | (Loss) income before income taxes | $(9,735) | $50,906 | $39,097 | $85,156 | | Net income applicable to FB Financial Corporation | $2,909 | $39,979 | $42,270 | $67,929 | | Basic earnings per common share | $0.06 | $0.85 | $0.91 | $1.45 | | Diluted earnings per common share | $0.06 | $0.85 | $0.91 | $1.45 | - **Net income applicable to FB Financial Corporation decreased significantly** for the three months ended June 30, 2025, to **$2.91 million from $39.98 million** in the prior year, primarily due to a **$60.55 million net loss from investment securities**[13](index=13&type=chunk) - For the six months ended June 30, 2025, **net income decreased to $42.27 million from $67.93 million** in the prior year, also largely impacted by the net loss from investment securities[13](index=13&type=chunk) [Consolidated Statements of Comprehensive Income](index=6&type=section&id=Consolidated%20Statements%20of%20Comprehensive%20Income%20(Unaudited)%20for%20the%20three%20and%20six%20months%20ended%20June%2030%2C%202025%20and%202024) These statements report net income and other comprehensive income, including unrealized gains and losses on securities **Consolidated Statements of Comprehensive Income (Amounts in thousands)** | Item | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Net income | $2,917 | $39,987 | $42,278 | $67,937 | | Total other comprehensive income, net of tax | $47,942 | $710 | $57,673 | $2,951 | | Comprehensive income applicable to FB Financial Corporation | $50,851 | $40,689 | $99,943 | $70,880 | - **Total other comprehensive income, net of tax, significantly increased to $47.94 million** for the three months ended June 30, 2025, from $710 thousand in the prior year, primarily due to a reclassification adjustment for loss on securities included in net income[15](index=15&type=chunk) - **Comprehensive income applicable to FB Financial Corporation increased to $50.85 million** for the three months ended June 30, 2025, compared to $40.69 million in the prior year, despite lower net income, due to the substantial other comprehensive income[15](index=15&type=chunk) [Consolidated Statements of Changes in Shareholders' Equity](index=7&type=section&id=Consolidated%20Statements%20of%20Changes%20in%20Shareholders'%20Equity%20(Unaudited)%20for%20the%20three%20and%20six%20months%20ended%20June%2030%2C%202025%20and%202024) These statements detail the changes in shareholders' equity resulting from net income, dividends, stock transactions, and other comprehensive income **Consolidated Statements of Changes in Shareholders' Equity (Amounts in thousands)** | Item | Balance at March 31, 2025 | Balance at June 30, 2025 | | :--- | :--- | :--- | | Common stock | $46,515 | $45,808 | | Additional paid-in capital | $854,715 | $822,548 | | Retained earnings | $792,685 | $786,785 | | Accumulated other comprehensive loss, net | $(91,953) | $(44,011) | | Total common shareholders' equity | $1,601,962 | $1,611,130 | | Item | Balance at December 31, 2024 | Balance at June 30, 2025 | | :--- | :--- | :--- | | Common stock | $46,663 | $45,808 | | Additional paid-in capital | $860,266 | $822,548 | | Retained earnings | $762,293 | $786,785 | | Accumulated other comprehensive loss, net | $(101,684) | $(44,011) | | Total common shareholders' equity | $1,567,538 | $1,611,130 | - **Total common shareholders' equity increased from $1.57 billion** at December 31, 2024, to **$1.61 billion** at June 30, 2025, driven by net income and a significant reduction in accumulated other comprehensive loss, net[18](index=18&type=chunk) - **Share repurchases amounted to $44.15 million** for the six months ended June 30, 2025, reducing common stock and additional paid-in capital[18](index=18&type=chunk) [Consolidated Statements of Cash Flows](index=9&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows%20(Unaudited)%20for%20the%20three%20and%20six%20months%20ended%20June%2030%2C%202025%20and%202024) These statements report the company's cash inflows and outflows from operating, investing, and financing activities **Consolidated Statements of Cash Flows (Amounts in thousands)** | Item | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $55,324 | $66,891 | | Net cash (used in) provided by investing activities | $(58,802) | $69,882 | | Net cash provided by (used in) financing activities | $126,719 | $(146,803) | | Net change in cash and cash equivalents | $123,241 | $(10,030) | | Cash and cash equivalents at end of the period | $1,165,729 | $800,902 | - **Net cash provided by financing activities significantly increased to $126.72 million** for the six months ended June 30, 2025, compared to a net cash used of $146.80 million in the prior year, primarily due to a net increase in deposits[20](index=20&type=chunk) - **Cash and cash equivalents at the end of the period increased to $1.17 billion** as of June 30, 2025, from $800.90 million in the prior year, reflecting a positive net change in cash and cash equivalents[20](index=20&type=chunk) [Condensed Notes to Consolidated Financial Statements](index=11&type=section&id=Condensed%20Notes%20to%20Consolidated%20Financial%20Statements%20(Unaudited)) These notes provide detailed disclosures and explanations of the accounting policies and financial data presented in the consolidated statements [Note (1)—Basis of presentation](index=11&type=section&id=Note%20(1)%E2%80%94Basis%20of%20presentation) This note outlines the basis for preparing the unaudited consolidated financial statements and details recent accounting policy modifications - FB Financial Corporation operates primarily through its wholly-owned subsidiary, FirstBank, which had **78 full-service branches** across Tennessee, Alabama, Kentucky, and Georgia as of June 30, 2025[23](index=23&type=chunk) - The Company modified its accounting policy for estimating expected credit losses, transitioning from a lifetime loss rate methodology to a **discounted cash flow estimation technique** for most loan segments, effective June 30, 2025[30](index=30&type=chunk)[34](index=34&type=chunk)[35](index=35&type=chunk) - The adoption of new accounting standards, ASU 2023-07 (Segment Reporting) and ASU 2023-08 (Crypto Assets), **did not have a material impact** on the Company's consolidated financial statements[55](index=55&type=chunk)[56](index=56&type=chunk) - On July 1, 2025, the Company completed the acquisition of Southern States Bancshares Inc in an all-stock transaction valued at **$368.36 million**, adding **$2.87 billion in total assets**[59](index=59&type=chunk)[60](index=60&type=chunk) [Note (2)—Investment securities](index=18&type=section&id=Note%20(2)%E2%80%94Investment%20securities) This note details the Company's investment securities portfolio, primarily available-for-sale (AFS) debt securities **AFS Debt Securities (Amounts in thousands)** | Item | June 30, 2025 (Fair Value) | December 31, 2024 (Fair Value) | | :--- | :--- | :--- | | U.S. government agency securities | $642,264 | $563,007 | | Mortgage-backed securities - residential | $541,343 | $810,999 | | Municipal securities | $144,228 | $147,857 | | Total AFS debt securities | $1,337,565 | $1,538,008 | | Gross unrealized losses (June 30, 2025) | $(64,050) | | | Gross unrealized losses (December 31, 2024) | | $(141,974) | - The fair value of AFS debt securities **decreased by $200.44 million** from December 31, 2024, to June 30, 2025, primarily due to sales of securities[61](index=61&type=chunk) - **Gross unrealized losses on AFS debt securities decreased from $141.97 million** at December 31, 2024, to **$64.05 million** at June 30, 2025, with no allowance for credit losses recognized[61](index=61&type=chunk)[64](index=64&type=chunk)[65](index=65&type=chunk) **Sales and Other Dispositions of AFS Debt Securities (Amounts in thousands)** | Item | Three Months Ended June 30, 2025 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | | Proceeds from sales | $266,454 | $266,454 | $207,882 | | Gross realized losses | $60,637 | $60,637 | $16,303 | [Note (3)—Loans and allowance for credit losses on loans HFI](index=22&type=section&id=Note%20(3)%E2%80%94Loans%20and%20allowance%20for%20credit%20losses%20on%20loans%20HFI) This note provides a detailed breakdown of the Company's loan portfolio, credit quality, and the allowance for credit losses (ACL) **Loans Held for Investment (HFI) by Class (Amounts in thousands)** | Loan Class | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Commercial and industrial | $1,788,911 | $1,691,213 | | Construction | $1,022,678 | $1,087,732 | | 1-to-4 family mortgage | $1,660,696 | $1,616,754 | | Multi-family mortgage | $587,254 | $653,769 | | Commercial real estate: Non-owner occupied | $2,198,689 | $2,099,129 | | Consumer and other | $604,498 | $493,744 | | Gross loans | $9,874,282 | $9,602,384 | | Less: Allowance for credit losses on loans HFI | $(148,948) | $(151,942) | | Net loans held for investment | $9,725,334 | $9,450,442 | - **Gross loans HFI increased by $271.90 million** from December 31, 2024, to June 30, 2025, with notable growth in commercial and industrial, 1-to-4 family mortgage, and consumer loans[70](index=70&type=chunk) - The **allowance for credit losses on loans HFI decreased by $2.99 million to $148.95 million** as of June 30, 2025, primarily due to a change in the CECL loss estimation methodology[98](index=98&type=chunk)[99](index=99&type=chunk) **Nonaccrual Loans by Class (Amounts in thousands)** | Loan Class | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Commercial and industrial | $2,692 | $9,661 | | Construction | $28,872 | $10,915 | | 1-to-4 family mortgage | $8,379 | $12,625 | | Multi-family mortgage | $9,582 | $21 | | Commercial real estate: Owner occupied | $7,861 | $9,551 | | Total nonaccrual loans | $73,950 | $59,358 | [Note (4)—Other real estate owned](index=35&type=section&id=Note%20(4)%E2%80%94Other%20real%20estate%20owned) This note summarizes the activity and balance of other real estate owned (OREO), which includes properties acquired through foreclosure **Other Real Estate Owned (Amounts in thousands)** | Item | Three Months Ended June 30, 2025 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | | Balance at beginning of period | $3,326 | $4,409 | $3,192 | | Transfers from loans | $1,230 | $3,297 | $2,400 | | Proceeds from sale of other real estate owned | $(1,744) | $(4,412) | $(1,434) | | Balance at end of period | $2,998 | $2,998 | $4,173 | - The balance of other real estate owned **decreased to $3.00 million** at June 30, 2025, from $4.41 million at the beginning of the six-month period[101](index=101&type=chunk) - Foreclosed residential real estate properties included in OREO totaled **$1.56 million** as of June 30, 2025, a decrease from $2.88 million at December 31, 2024[101](index=101&type=chunk) [Note (5)—Leases](index=35&type=section&id=Note%20(5)%E2%80%94Leases) This note provides information on the Company's operating and finance leases, detailing assets, liabilities, and lease expenses **Lease Information (Amounts in thousands)** | Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Operating lease right-of-use assets | $47,764 | $47,963 | | Operating lease liabilities | $59,289 | $60,024 | | Weighted average remaining lease term (operating) | 10.7 years | 11.0 years | | Weighted average discount rate (operating) | 3.54% | 3.47% | **Total Lease Cost (Amounts in thousands)** | Item | Three Months Ended June 30, 2025 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | | Total lease cost | $2,312 | $4,596 | $4,330 | - The Company had **47 operating leases and 1 finance lease** as of June 30, 2025, for various locations, with total lease costs increasing slightly for the six months ended June 30, 2025, compared to the prior year[103](index=103&type=chunk)[105](index=105&type=chunk) [Note (6)—Mortgage servicing rights](index=37&type=section&id=Note%20(6)%E2%80%94Mortgage%20servicing%20rights) This note details the changes in the Company's mortgage servicing rights (MSRs) and related servicing income and expenses **Mortgage Servicing Rights (MSRs) (Amounts in thousands)** | Item | June 30, 2025 (Carrying Value) | June 30, 2024 (Carrying Value) | | :--- | :--- | :--- | | Carrying value at beginning of period (3 months) | $156,379 | $165,674 | | Carrying value at end of period (3 months) | $153,464 | $164,505 | | Carrying value at beginning of period (6 months) | $162,038 | $164,249 | | Carrying value at end of period (6 months) | $153,464 | $164,505 | **Net Servicing Income (Amounts in thousands)** | Item | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Net servicing income | $862 | $1,047 | $3,148 | $3,406 | - The carrying value of MSRs **decreased to $153.46 million** at June 30, 2025, from $162.04 million at the beginning of the six-month period[107](index=107&type=chunk) - A **10% increase in prepayment speed** is estimated to decrease MSR fair value by **$4.27 million**, while a **100 basis point increase in discount rate** is estimated to decrease fair value by **$7.20 million** as of June 30, 2025[107](index=107&type=chunk) [Note (7)—Income taxes](index=38&type=section&id=Note%20(7)%E2%80%94Income%20taxes) This note reconciles the Company's income tax benefit/expense, highlighting the impact of non-recurring items **Income Tax (Benefit) Expense (Amounts in thousands)** | Item | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Income tax (benefit) expense, as reported | $(12,652) | $10,919 | $(3,181) | $17,219 | | Federal taxes calculated at statutory rate (21.0%) | $(2,045) | $10,691 | $8,210 | $17,883 | | Expiration of the statute of limitations | $(8,713) | — | $(8,713) | — | | Interest on refunds | $(1,645) | — | $(2,591) | — | - For the three and six months ended June 30, 2025, the Company recognized a significant income tax benefit of **$12.65 million and $3.18 million**, respectively, primarily due to a **one-time tax benefit of $10.71 million** from the expiration of the statute of limitations[109](index=109&type=chunk) [Note (8)—Commitments and contingencies](index=38&type=section&id=Note%20(8)%E2%80%94Commitments%20and%20contingencies) This note details the Company's off-balance sheet financial instruments, including commitments to extend credit and letters of credit **Commitments to Extend Credit and Letters of Credit (Amounts in thousands)** | Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Commitments to extend credit, excluding interest rate lock commitments | $2,861,685 | $2,770,105 | | Letters of credit | $62,260 | $69,855 | | Balance at end of period | $2,923,945 | $2,839,960 | - **Total unfunded loan commitments increased to $2.92 billion** at June 30, 2025, from $2.84 billion at December 31, 2024[112](index=112&type=chunk) **Allowance for Credit Losses on Unfunded Loan Commitments (Amounts in thousands)** | Item | Three Months Ended June 30, 2025 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | | Balance at beginning of period | $6,493 | $6,107 | $8,770 | | Impact of change in accounting estimate for current expected credit losses | $6,452 | $6,452 | — | | (Reversal of) provision for credit losses on unfunded commitments | $(13) | $373 | $(2,786) | | Balance at end of period | $12,932 | $12,932 | $5,984 | - The allowance for credit losses on unfunded loan commitments **increased to $12.93 million** at June 30, 2025, from $6.11 million at the beginning of the six-month period, largely due to a **$6.45 million impact from the change in CECL estimation methodology**[116](index=116&type=chunk) [Note (9)—Derivatives](index=40&type=section&id=Note%20(9)%E2%80%94Derivatives) This note describes the Company's use of derivative financial instruments for interest rate risk management and to facilitate customer needs - The Company uses derivative instruments, including interest rate swaps, forward commitments, and futures contracts, for interest rate risk management, with **total notional amounts of $1.15 billion** at June 30, 2025[120](index=120&type=chunk)[134](index=134&type=chunk) **Non-Designated Derivative Financial Instruments (Amounts in thousands)** | Item | June 30, 2025 (Notional Amount) | June 30, 2025 (Asset Fair Value) | June 30, 2025 (Liability Fair Value) | | :--- | :--- | :--- | :--- | | Interest rate contracts | $598,390 | $23,135 | $23,194 | | Forward commitments | $236,000 | — | $638 | | Interest rate-lock commitments | $127,004 | $2,322 | — | | Futures contracts | $185,000 | $2,109 | — | | Total | $1,146,394 | $27,566 | $23,832 | **Gains (Losses) from Non-Designated Derivatives (Amounts in thousands)** | Item | Three Months Ended June 30, 2025 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | | Total included in mortgage banking income | $(40) | $3,483 | $(3,789) | [Note (10)—Fair value of financial instruments](index=45&type=section&id=Note%20(10)%E2%80%94Fair%20value%20of%20financial%20instruments) This note defines fair value measurement and categorizes financial assets and liabilities into a three-level hierarchy - The fair value hierarchy prioritizes inputs: **Level 1** (quoted prices in active markets), **Level 2** (significant other observable inputs), and **Level 3** (significant unobservable inputs)[137](index=137&type=chunk)[138](index=138&type=chunk)[139](index=139&type=chunk) **Financial Assets Measured at Fair Value on a Recurring Basis (Amounts in thousands)** | Item | June 30, 2025 (Total Fair Value) | December 31, 2024 (Total Fair Value) | | :--- | :--- | :--- | | AFS debt securities | $1,337,565 | $1,538,008 | | Loans held for sale, at fair value | $123,235 | $95,403 | | Mortgage servicing rights (Level 3) | $153,464 | $162,038 | | Derivatives | $27,566 | $29,951 | **Financial Assets Measured at Fair Value on a Nonrecurring Basis (Amounts in thousands)** | Item | June 30, 2025 (Total Fair Value) | December 31, 2024 (Total Fair Value) | | :--- | :--- | :--- | | Other real estate owned (Level 3) | $1,602 | $2,873 | | Collateral-dependent net loans held for investment (Level 3) | $25,569 | $30,512 | - Net losses of **$372 thousand** and net gains of **$1.83 million** resulted from fair value changes of mortgage loans held for sale for the three and six months ended June 30, 2025, respectively[148](index=148&type=chunk) [Note (11)—Segment reporting](index=53&type=section&id=Note%20(11)%E2%80%94Segment%20reporting) This note identifies the Company's two reportable segments, Banking and Mortgage, and provides selected financial information for each - The Company operates through two reportable segments: **Banking** and **Mortgage**[152](index=152&type=chunk) - The chief operating decision maker uses **income before income taxes** to assess segment performance and allocate resources[153](index=153&type=chunk) **Segment Income Before Income Taxes (Amounts in thousands)** | Segment | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Banking | $(6,723) | $50,060 | $40,598 | $82,696 | | Mortgage | $(3,012) | $846 | $(1,501) | $2,460 | | Consolidated (Loss) Income before income taxes | $(9,735) | $50,906 | $39,097 | $85,156 | - The **Banking segment reported a loss before taxes of $6.72 million** for the three months ended June 30, 2025, compared to income of $50.06 million in the prior year, primarily due to a **$60.5 million net loss on investment securities**[156](index=156&type=chunk)[222](index=222&type=chunk) [Note (12)—Minimum capital requirements](index=57&type=section&id=Note%20(12)%E2%80%94Minimum%20capital%20requirements) This note outlines the regulatory capital requirements for the Company and FirstBank and confirms compliance - The Company and FirstBank are subject to regulatory capital requirements and **met all capital adequacy requirements** as of June 30, 2025, and December 31, 2024[165](index=165&type=chunk)[166](index=166&type=chunk) **Capital Ratios (June 30, 2025)** | Capital Ratio | FB Financial Corporation (Actual Ratio) | FirstBank (Actual Ratio) | Minimum Requirement for Capital Adequacy with Capital Buffer | | :--- | :--- | :--- | :--- | | Total Capital (to risk-weighted assets) | 14.7% | 14.2% | 10.5% | | Tier 1 Capital (to risk-weighted assets) | 12.6% | 12.1% | 8.5% | | Common Equity Tier 1 Capital (to risk-weighted assets) | 12.3% | 12.1% | 7.0% | | Tier 1 Capital (to average assets) | 11.3% | 10.8% | 4.0% | - All actual capital ratios for both FB Financial Corporation and FirstBank were **well above the minimum regulatory requirements**, indicating a strong capital position[169](index=169&type=chunk) [Note (13)—Stock-based compensation](index=59&type=section&id=Note%20(13)%E2%80%94Stock-based%20compensation) This note details the Company's stock-based compensation plans, including RSUs, PSUs, and the ESPP **Restricted Stock Units (RSUs) Activity (Six Months Ended June 30, 2025)** | Item | Restricted Stock Units Outstanding | | :--- | :--- | | Balance at beginning of period (unvested) | 345,436 | | Granted | 148,306 | | Vested | (156,509) | | Forfeited | (3,335) | | Balance at end of period (unvested) | 333,898 | - Total unrecognized compensation cost related to unvested RSUs was **$9.39 million** as of June 30, 2025, expected to be recognized over a weighted-average period of **1.99 years**[174](index=174&type=chunk) **Performance-Based Restricted Stock Units (PSUs) Activity (Six Months Ended June 30, 2025)** | Item | Performance Stock Units Outstanding | | :--- | :--- | | Balance at beginning of period (unvested) | 223,393 | | Granted | 75,329 | | Vested | (50,269) | | Balance at end of period (unvested) | 247,858 | - Compensation cost for PSUs was **$3.22 million** for the six months ended June 30, 2025, with a maximum unrecognized compensation cost at 200% payout of **$14.81 million**[178](index=178&type=chunk) [Note (14)—Related party transactions](index=61&type=section&id=Note%20(14)%E2%80%94Related%20party%20transactions) This note discloses transactions with related parties, including loans to and deposits from management, directors, and significant shareholders **Loans to Related Parties (Amounts in thousands)** | Item | Amount | | :--- | :--- | | Loans outstanding at January 1, 2025 | $31,406 | | New loans and advances | $6,166 | | Repayments | $(10,939) | | Loans outstanding at June 30, 2025 | $26,633 | - **Loans outstanding to related parties decreased to $26.63 million** at June 30, 2025, from $31.41 million at January 1, 2025[180](index=180&type=chunk) - The Bank held **$254.88 million in deposits from related parties** as of June 30, 2025, a decrease from $282.96 million at December 31, 2024[181](index=181&type=chunk) - The Company has an equity investment in a privately held entity and a master loan purchase agreement to purchase up to **$250 million** in manufactured housing loans; as of June 30, 2025, the amortized cost of these loans was **$112.31 million**[184](index=184&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operation](index=64&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operation) This section provides management's perspective on the Company's financial condition and results of operations for the periods ended June 30, 2025 [Forward-looking statements](index=64&type=section&id=Forward-looking%20statements) This section outlines the nature of forward-looking statements in the report and the risks and uncertainties that could affect actual results - The report contains forward-looking statements regarding future plans, results, strategies, and expectations, including those related to the Southern States Bancshares, Inc merger[186](index=186&type=chunk) - These statements are subject to various risks and uncertainties, such as economic conditions, interest rate fluctuations, and integration risks from mergers[186](index=186&type=chunk) [Critical accounting policies](index=66&type=section&id=Critical%20accounting%20policies) This section notes that financial statements are prepared under GAAP and involve estimates, with key policy updates detailed in the notes - The financial statements are prepared in accordance with GAAP, and certain financial information involves approximate measurements and estimates[189](index=189&type=chunk) - Updates to accounting policies, particularly regarding the allowance for credit losses (ACL) methodology, are detailed in Note 1 of the consolidated financial statements[189](index=189&type=chunk) [Financial highlights](index=67&type=section&id=Financial%20highlights) This section provides a summary of key financial metrics and performance indicators for the recent periods **Selected Financial Highlights (Amounts in thousands, except per share data)** | Item | June 30, 2025 | June 30, 2024 | December 31, 2024 | | :--- | :--- | :--- | :--- | | Total assets | $13,354,238 | $12,535,169 | $13,157,482 | | Total deposits | $11,403,470 | $10,468,002 | $11,210,434 | | Net income applicable to FB Financial Corporation (3 months) | $2,909 | $39,979 | | | Net income applicable to FB Financial Corporation (6 months) | $42,270 | $67,929 | | | Basic net income per share (3 months) | $0.06 | $0.85 | | | Diluted net income per share (6 months) | $0.91 | $1.45 | | | Return on average assets (3 months) | 0.09% | 1.30% | | | Net interest margin (tax-equivalent basis) (3 months) | 3.68% | 3.57% | | | Nonperforming loans HFI as a percentage of loans HFI | 0.97% | 0.79% | 0.87% | | Total risk-based capital (Company) | 14.7% | 15.1% | 15.2% | - **Net income for the three months ended June 30, 2025, significantly decreased to $2.9 million** from $40.0 million in the prior year, resulting in a lower **return on average assets of 0.09%** (vs 1.30%)[191](index=191&type=chunk) - **Net interest margin (tax-equivalent basis) improved to 3.68%** for the three months ended June 30, 2025, from 3.57% in the prior year[191](index=191&type=chunk) [GAAP reconciliation and management explanation of non-GAAP financial measures](index=69&type=section&id=GAAP%20reconciliation%20and%20management%20explanation%20of%20non-GAAP%20financial%20measures) This section presents non-GAAP financial measures used by management to evaluate performance and provides reconciliations to GAAP figures [Core efficiency ratio (tax-equivalent basis)](index=69&type=section&id=Core%20efficiency%20ratio%20(tax-equivalent%20basis)) This non-GAAP measure is used to understand ongoing operational efficiency by excluding certain non-core items - The core efficiency ratio (tax-equivalent basis) is a non-GAAP measure used by management to understand ongoing operations and enhance comparability[197](index=197&type=chunk) **Core Efficiency Ratio (Tax-Equivalent Basis)** | Item | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Core noninterest expense | $78,527 | $74,078 | $157,675 | $145,998 | | Core revenue (tax-equivalent basis) | $137,997 | $127,086 | $270,065 | $250,895 | | Core efficiency ratio (tax-equivalent basis) | 56.9% | 58.3% | 58.4% | 58.2% | - The **core efficiency ratio (tax-equivalent basis)** for the three months ended June 30, 2025, was **56.9%**, an improvement from 58.3% in the prior year, indicating better operational efficiency when excluding non-core items[199](index=199&type=chunk) [Tangible book value per common share and tangible common equity to tangible assets](index=71&type=section&id=Tangible%20book%20value%20per%20common%20share%20and%20tangible%20common%20equity%20to%20tangible%20assets) These non-GAAP measures exclude goodwill and other intangibles to provide a clearer view of capital adequacy - Tangible book value per common share and tangible common equity to tangible assets are non-GAAP measures that exclude goodwill and other intangibles[200](index=200&type=chunk) **Tangible Capital Measures (Amounts in thousands, except per share data)** | Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Tangible assets | $13,107,202 | $12,909,159 | | Tangible common equity | $1,364,094 | $1,319,215 | | Tangible book value per common share | $29.78 | $28.27 | | Tangible common equity to tangible assets | 10.4% | 10.2% | - **Tangible book value per common share increased to $29.78** at June 30, 2025, from $28.27 at December 31, 2024, reflecting an improvement in tangible equity per share[202](index=202&type=chunk) [Return on average tangible common equity](index=72&type=section&id=Return%20on%20average%20tangible%20common%20equity) This non-GAAP measure depicts profitability without the impact of intangible assets by excluding them from average shareholders' equity - Return on average tangible common equity is a non-GAAP measure that excludes goodwill and other intangibles from average shareholders' equity[203](index=203&type=chunk) **Return on Average Tangible Common Equity** | Item | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Average tangible common equity | $1,335,747 | $1,223,195 | $1,335,859 | $1,216,534 | | Net income applicable to FB Financial Corporation | $2,909 | $39,979 | $42,270 | $67,929 | | Return on average tangible common equity | 0.87% | 13.1% | 6.38% | 11.2% | - **Return on average tangible common equity decreased significantly to 0.87%** for the three months ended June 30, 2025, from 13.1% in the prior year, aligning with the overall decline in net income[204](index=204&type=chunk) [Company overview](index=72&type=section&id=Company%20overview) This section describes the Company's business, primary operations through its subsidiary FirstBank, and its two operating segments - FB Financial Corporation is a financial holding company headquartered in Nashville, Tennessee, operating primarily through its wholly-owned subsidiary, FirstBank[205](index=205&type=chunk) - FirstBank provides commercial and consumer banking services across Tennessee, Alabama, Kentucky, North Carolina, and Georgia, with **78 full-service branches** as of June 30, 2025[205](index=205&type=chunk) - The Company operates through two segments: **Banking** (revenue from loans, investments, fees) and **Mortgage** (revenue from origination fees, secondary market sales, and servicing)[207](index=207&type=chunk) [Mergers](index=74&type=section&id=Mergers) This section details the recent acquisition of Southern States Bancshares Inc, including its strategic rationale and financial impact - On July 1, 2025, the Company completed the acquisition of Southern States Bancshares Inc in an all-stock transaction, strengthening its presence in Alabama and expanding into Georgia[208](index=208&type=chunk)[209](index=209&type=chunk) - Southern States contributed approximately **$2.87 billion in total assets**, **$2.32 billion in loans**, and **$2.47 billion in deposits** at closing[209](index=209&type=chunk) - Total consideration paid was **$368.4 million**, based on the Company's closing stock price of $45.30 per share on June 30, 2025[209](index=209&type=chunk) [Overview of recent financial performance](index=74&type=section&id=Overview%20of%20recent%20financial%20performance) This section provides a comparative analysis of the company's financial performance for the three and six months ended June 30, 2025 and 2024 [Three months ended June 30, 2025 compared to three months ended June 30, 2024](index=74&type=section&id=Three%20months%20ended%20June%2030%2C%202025%20compared%20to%20three%20months%20ended%20June%2030%2C%202024) This subsection compares key financial results for the second quarter of 2025 against the same period in 2024 - **Net income decreased to $2.9 million** for Q2 2025 from $40.0 million for Q2 2024, with diluted EPS falling from $0.85 to $0.06[210](index=210&type=chunk) - **Net interest income increased to $111.4 million** (from $102.6 million), and net interest margin (tax-equivalent basis) rose to 3.68% (from 3.57%)[211](index=211&type=chunk) - **Noninterest income decreased by $60.2 million** to a loss of $34.6 million, driven by a **$60.5 million net loss on investment securities sales**[213](index=213&type=chunk) - **Noninterest expense increased to $81.3 million** (from $75.1 million), including $2.7 million in merger and integration costs[214](index=214&type=chunk) [Six months ended June 30, 2025 compared to the six months ended June 30, 2024](index=76&type=section&id=Six%20months%20ended%20June%2030%2C%202025%20compared%20to%20the%20six%20months%20ended%20June%2030%2C%202024) This subsection compares key financial results for the first half of 2025 against the same period in 2024 - **Net income decreased to $42.3 million** for H1 2025 from $67.9 million for H1 2024, with diluted EPS falling from $1.45 to $0.91[216](index=216&type=chunk) - **Net interest income increased to $219.1 million** (from $202.1 million), and net interest margin (tax-equivalent basis) rose to 3.61% (from 3.49%)[217](index=217&type=chunk) - **Noninterest income decreased by $45.1 million** to a loss of $11.5 million, primarily due to a **$60.5 million net loss on investment securities sales** (vs $16.2 million loss in prior year)[218](index=218&type=chunk) - **Noninterest expense increased to $160.8 million** (from $147.5 million), driven by higher salaries, merger costs, advertising, and other expenses[219](index=219&type=chunk) [Business segment highlights](index=76&type=section&id=Business%20segment%20highlights) This section analyzes the performance of the Company's two primary business segments, Banking and Mortgage [Banking](index=76&type=section&id=Banking) This subsection details the financial performance of the Banking segment, including net interest income and pre-tax results - The Banking segment reported a **pre-tax loss of $6.7 million** for Q2 2025, a significant decline from $50.1 million income in Q2 2024, primarily due to a **$60.5 million net loss on investment securities**[222](index=222&type=chunk) - **Net interest income for the Banking segment increased to $108.9 million** in Q2 2025 from $101.2 million in Q2 2024[222](index=222&type=chunk) - For H1 2025, the Banking segment's **pre-tax income was $40.6 million**, down from $82.7 million in H1 2024, also largely impacted by the $60.5 million net loss on investment securities[223](index=223&type=chunk) [Mortgage](index=79&type=section&id=Mortgage) This subsection details the financial performance of the Mortgage segment, including mortgage banking income and pre-tax results - The Mortgage segment reported a **pre-tax loss of $3.0 million** for Q2 2025, compared to $0.8 million income in Q2 2024[225](index=225&type=chunk) - **Mortgage banking income increased by $1.1 million to $13.0 million** in Q2 2025, driven by a $2.3 million increase in gains on sale, partially offset by negative fair value changes[225](index=225&type=chunk)[226](index=226&type=chunk) - For H1 2025, the Mortgage segment's **pre-tax loss was $1.5 million**, compared to $2.5 million income in H1 2024, with mortgage banking income increasing by $1.0 million to $25.5 million[227](index=227&type=chunk)[228](index=228&type=chunk) - **Provisions for credit losses in the Mortgage segment increased significantly** due to changes in the CECL loss estimation methodology and forecasts impacting mortgage reserves[225](index=225&type=chunk)[227](index=227&type=chunk) [Results of operations](index=80&type=section&id=Results%20of%20operations) This section provides a detailed analysis of the components of the company's operating results, including net interest income and noninterest items [Net interest income](index=80&type=section&id=Net%20interest%20income) This subsection analyzes the components of net interest income, including interest income, interest expense, and net interest margin - **Net interest income (tax-equivalent basis) increased by $9.0 million to $112.2 million** for Q2 2025, driven by a $4.9 million increase in interest income and a $4.1 million decrease in interest expense[233](index=233&type=chunk)[247](index=247&type=chunk) - **Interest income on loans HFI increased by $3.7 million to $158.0 million** in Q2 2025, primarily due to increased volume, despite a 26 basis point decrease in yield to 6.44%[235](index=235&type=chunk) - **Interest expense on interest-bearing deposits decreased by $2.9 million to $68.6 million** in Q2 2025, with the total cost of interest-bearing deposits falling to 3.10% (from 3.52%)[239](index=239&type=chunk) - For H1 2025, **net interest income (tax-equivalent basis) increased by $17.2 million to $220.7 million**, with net interest margin rising to 3.61% (from 3.49%)[248](index=248&type=chunk)[263](index=263&type=chunk) [Provision for credit losses](index=88&type=section&id=Provision%20for%20credit%20losses) This subsection discusses the provision for credit losses on loans and unfunded commitments, including the impact of the new CECL methodology - The Company recognized a **reversal of credit losses on loans HFI of $1.1 million** for Q2 2025, compared to a provision expense of $3.9 million for Q2 2024[272](index=272&type=chunk) - The Q2 2025 reversal was primarily due to a **$6.8 million reduction from the change in CECL loss estimation methodology**, partially offset by $5.7 million of provision growth[272](index=272&type=chunk) - A **provision expense for credit losses on unfunded commitments of $6.4 million** was recorded for Q2 2025, largely due to a $6.5 million impact from the CECL methodology change[273](index=273&type=chunk) - For H1 2025, the provision for credit losses on loans HFI was **$0.8 million** (vs $5.8 million in H1 2024), reflecting a $7.7 million growth in provision offset by a $6.8 million reduction from the CECL methodology change[275](index=275&type=chunk) [Noninterest income](index=91&type=section&id=Noninterest%20income) This subsection analyzes the various sources of noninterest income, such as mortgage banking, investment services, and securities gains/losses **Noninterest Income (Amounts in thousands)** | Item | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Mortgage banking income | $13,029 | $11,910 | $25,455 | $24,495 | | Investment services and trust income | $3,922 | $3,387 | $7,633 | $6,617 | | Loss from investment securities, net | $(60,549) | — | $(60,533) | $(16,213) | | Total noninterest (loss) income | $(34,552) | $25,608 | $(11,520) | $33,570 | - Total noninterest income for Q2 2025 was a **$34.6 million loss** (vs $25.6 million income in Q2 2024), primarily due to a **$60.5 million net loss from investment securities sales**[279](index=279&type=chunk) - **Mortgage banking income increased by $1.1 million to $13.0 million** in Q2 2025, driven by higher origination fees and gains on sale[280](index=280&type=chunk) - For H1 2025, total noninterest income was an **$11.5 million loss** (vs $33.6 million income in H1 2024), mainly due to a **$60.5 million net loss from investment securities sales** (vs $16.2 million loss in H1 2024)[287](index=287&type=chunk)[291](index=291&type=chunk) [Noninterest expense](index=93&type=section&id=Noninterest%20expense) This subsection breaks down noninterest expenses, including salaries, merger costs, and other operating expenses **Noninterest Expense (Amounts in thousands)** | Item | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Salaries, commissions and employee benefits | $46,631 | $46,225 | $94,982 | $90,843 | | Merger and integration costs | $2,734 | — | $3,135 | — | | Other expense | $17,790 | $15,664 | $34,542 | $30,565 | | Total noninterest expense | $81,261 | $75,093 | $160,810 | $147,513 | - **Total noninterest expense increased by $6.2 million (8.2%) to $81.3 million** in Q2 2025, driven by **$2.7 million in merger and integration costs** and a $2.1 million increase in other expenses[295](index=295&type=chunk)[301](index=301&type=chunk)[302](index=302&type=chunk) - For H1 2025, **total noninterest expense increased by $13.3 million (9.0%) to $160.8 million**, primarily due to a $4.1 million increase in salaries and benefits, $3.1 million in merger costs, and $4.0 million in other expenses[303](index=303&type=chunk)[304](index=304&type=chunk)[307](index=307&type=chunk)[308](index=308&type=chunk) [Efficiency ratio](index=94&type=section&id=Efficiency%20ratio) This subsection presents the efficiency ratio, a key measure of operational cost-effectiveness, on both a GAAP and adjusted basis - The efficiency ratio was **105.7% for Q2 2025** (vs 58.6% in Q2 2024) and **77.5% for H1 2025** (vs 62.6% in H1 2024)[310](index=310&type=chunk) - The **adjusted efficiency ratio (tax-equivalent basis) was 56.9% for Q2 2025** (vs 58.3% in Q2 2024) and **58.4% for H1 2025** (vs 58.2% in H1 2024), indicating a more stable core operational efficiency[310](index=310&type=chunk) [Income taxes](index=94&type=section&id=Income%20taxes) This subsection explains the income tax expense or benefit and the effective tax rate for the reported periods - The Company recognized an **income tax benefit of $12.7 million for Q2 2025** (vs $10.9 million expense in Q2 2024) and **$3.2 million for H1 2025** (vs $17.2 million expense in H1 2024)[311](index=311&type=chunk) - The Q2 2025 tax benefit reflects the income tax effect of a **$60.5 million loss on AFS debt securities** and a **one-time $10.7 million tax benefit** from the expiration of the statute of limitations[311](index=311&type=chunk) - The effective tax rates were **130.0% for Q2 2025** and **(8.1)% for H1 2025**, significantly impacted by these non-recurring items[311](index=311&type=chunk) [Financial condition](index=96&type=section&id=Financial%20condition) This section provides a detailed analysis of the company's balance sheet, including loans, asset quality, deposits, and liquidity [Loan portfolio](index=96&type=section&id=Loan%20portfolio) This subsection provides a detailed breakdown of the loan portfolio by type, maturity, and interest rate structure **Loan Portfolio by Type (Amounts in thousands)** | Loan Type | June 30, 2025 (Outstanding) | December 31, 2024 (Outstanding) | | :--- | :--- | :--- | | Commercial and industrial | $1,788,911 | $1,691,213 | | Construction | $1,022,678 | $1,087,732 | | 1-to-4 family mortgage | $1,660,696 | $1,616,754 | | Non-owner occupied commercial real estate | $2,198,689 | $2,099,129 | | Total loans | $9,874,282 | $9,602,384 | - **Total loans held for investment (HFI) increased to $9.87 billion** at June 30, 2025, from $9.60 billion at December 31, 2024, representing **73.9% of total assets**[314](index=314&type=chunk) - The loan portfolio is heavily concentrated in the geographic markets served, primarily Tennessee and Alabama, and is diversified across various industry classifications[316](index=316&type=chunk) **Loan Maturity and Interest Rate Composition (June 30, 2025, Amounts in thousands)** | Maturity | Fixed Interest Rate | Floating Interest Rate | Total | | :--- | :--- | :--- | :--- | | One year or less | $644,431 | $1,309,293 | $1,953,724 | | One to five years | $2,484,702 | $2,204,726 | $4,689,428 | | Five to fifteen years | $931,079 | $1,045,487 | $1,976,566 | | Over fifteen years | $921,093 | $333,471 | $1,254,564 | | Total | $4,981,305 (50.4%) | $4,892,977 (49.6%) | $9,874,282 | [Asset quality](index=104&type=section&id=Asset%20quality) This subsection analyzes asset quality, focusing on nonperforming assets and the allowance for credit losses **Nonperforming Assets (Amounts in thousands)** | Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total nonperforming loans HFI | $95,912 | $83,705 | | Mortgage loans held for sale (delinquent GNMA) | $20,977 | $31,357 | | Other real estate owned | $2,998 | $4,409 | | Other repossessed assets | $3,151 | $2,444 | | Total nonperforming assets | $123,038 | $121,915 | | Nonperforming loans HFI as a percentage of total loans HFI | 0.97% | 0.87% | | Nonperforming assets as a percentage of total assets | 0.92% | 0.93% | - **Total nonperforming assets increased to $123.0 million** at June 30, 2025, from $121.9 million at December 31, 2024[332](index=332&type=chunk)[336](index=336&type=chunk) - **Nonperforming loans HFI increased by $12.2 million to $95.9 million**, primarily in construction and multi-family portfolios[333](index=333&type=chunk) **Allowance for Credit Losses (ACL) on Loans HFI (Amounts in thousands)** | Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total allowance for credit losses on loans HFI | $148,948 | $151,942 | | ACL as a % of loans HFI | 1.51% | 1.58% | | ACL as a % of nonaccrual loans HFI | 201.4% | 256.0% | | ACL as a % of nonperforming loans | 155.3% | 181.5% | - The **ACL on loans HFI decreased to $148.9 million (1.51% of loans HFI)** at June 30, 2025, from $151.9 million (1.58% of loans HFI) at December 31, 2024, influenced by the change in CECL methodology[346](index=346&type=chunk) [Deposits](index=111&type=section&id=Deposits) This subsection details the composition and trends of the company's deposit base, a primary source of funding - **Total deposits increased to $11.40 billion** at June 30, 2025, from $11.21 billion at December 31, 2024[351](index=351&type=chunk) - **Noninterest-bearing deposits increased to $2.19 billion**, including a rise in mortgage escrow deposits to $114.7 million[352](index=352&type=chunk) - **Interest-bearing checking deposits decreased to $2.33 billion**, while money market and savings deposits increased by $307.1 million due to promotional campaigns[353](index=353&type=chunk) **Deposit Distribution by Type (Amounts in thousands)** | Deposit Type | June 30, 2025 (Amount) | June 30, 2025 (% of total deposits) | December 31, 2024 (Amount) | December 31, 2024 (% of total deposits) | | :--- | :--- | :--- | :--- | :--- | | Noninterest-bearing demand | $2,191,903 | 19% | $2,116,232 | 19% | | Interest-bearing checking | $2,325,551 | 20% | $2,906,425 | 26% | | Money market | $4,294,217 | 38% | $3,986,777 | 36% | | Customer time deposits | $1,721,745 | 15% | $1,380,205 | 12% | | Brokered and internet time deposits | $518,719 | 5% | $469,089 | 4% | | Total deposits | $11,403,470 | 100% | $11,210,434 | 100% | - Estimated uninsured and uncollateralized deposits were **$2.99 billion (26.2% of total deposits)** at June 30, 2025[360](index=360&type=chunk) [Other earning assets](index=114&type=section&id=Other%20earning%20assets) This subsection discusses other earning assets, primarily the available-for-sale (AFS) debt securities portfolio - **Federal funds sold increased to $298.0 million** at June 30, 2025, from $64.8 million at December 31, 2024, reflecting changes in liquidity deployment strategy[363](index=363&type=chunk) - The fair value of **AFS debt securities decreased to $1.34 billion** at June 30, 2025, from $1.54 billion at December 31, 2024, with net unrealized losses of $63.3 million[365](index=365&type=chunk) - During Q2 2025, the Company sold **$266.5 million of mortgage-backed AFS debt securities**, resulting in a **$60.5 million net loss**, with proceeds intended for debt redemption and higher-yielding loan originations[366](index=366&type=chunk) **AFS Debt Securities Portfolio (Fair Value and Yields)** | Security Type | June 30, 2025 (Fair Value) | June 30, 2025 (Weighted Average Yield) | December 31, 2024 (Fair Value) | December 31, 2024 (Weighted Average Yield) | | :--- | :--- | :--- | :--- | :--- | | U.S. government agency securities | $642,264 | 4.90% | $563,007 | 5.40% | | Municipal securities | $144,228 | 2.98% | $147,857 | 2.96% | | Mortgage-backed securities - residential and commercial | $550,095 | 3.85% | $825,856 | 3.09% | | Total AFS debt securities | $1,337,565 | 4.26% | $1,538,008 | 3.93% | [Borrowed funds](index=116&type=section&id=Borrowed%20funds) This subsection details the company's borrowed funds, including repurchase agreements, FHLB advances, and subordinated debt - **Securities sold under agreements to repurchase totaled $11.4 million** at June 30, 2025, down from $13.5 million at December 31, 2024[373](index=373&type=chunk) - The Company had **no FHLB advances outstanding** as of June 30, 2025, or December 31, 2024, despite having a borrowing capacity of **$1.48 billion**[375](index=375&type=chunk) **Subordinated Debt (Amounts in thousands)** | Item | Total Debt Outstanding | Interest Rate (June 30, 2025) | | :--- | :--- | :--- | | FBK Trust I | $9,280 | 7.81% | | FBK Trust II | $21,650 | 7.71% | | FBK subordinated debt I | $100,000 | 4.50% | | Total subordinated debt, net | $130,898 | | - The Company anticipates utilizing proceeds from recent securities sales to **redeem outstanding subordinated and trust preferred debt**[377](index=377&type=chunk) [Liquidity and capital resources](index=118&type=section&id=Liquidity%20and%20capital%20resources) This subsection discusses the company's management of liquidity and capital to meet its financial obligations and support growth - The Company maintains adequate liquidity through managing asset/liability maturities, growing low-cost deposits, and utilizing investment portfolios and various borrowing lines[381](index=381&type=chunk)[382](index=382&type=chunk)[383](index=383&type=chunk)[384](index=384&type=chunk) **Liquidity Summary (Amounts in thousands)** | Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Current on-balance sheet liquidity | $1,713,083 | $1,643,453 | | Total available sources of liquidity | $6,926,145 | $6,769,537 | | On-balance sheet liquidity as a percentage of total assets | 12.8% | 12.5% | | On-balance sheet liquidity and available sources of liquidity as a percentage of estimated uninsured and uncollateralized deposits | 289.5% | 293.8% | - As of June 30, 2025, the Company had **$1.48 billion in FHLB borrowing capacity** and **$370.0 million in unsecured lines of credit**, with no outstanding borrowings[385](index=385&type=chunk)[386](index=386&type=chunk) - The Bank had **$91.4 million of retained earnings available for dividend payments** to the Company without prior regulatory approval as of June 30, 2025[392](index=392&type=chunk) [Shareholders' equity and capital management](index=120&type=section&id=Shareholders'%20equity%20and%20capital%20management) This subsection analyzes shareholders' equity and capital ratios, demonstrating the company's strong capital position relative to regulatory requirements - **Total shareholders' equity increased to $1.61 billion** at June 30, 2025, from $1.57 billion at December 31, 2024, driven by net income and a reduction in accumulated other comprehensive loss, net[394](index=394&type=chunk) - **Book value per common share increased to $35.17** at June 30, 2025, from $33.59 at December 31, 2024[394](index=394&type=chunk) - The Company's capital ratios remain **well above regulatory requirements** for well-capitalized institutions, with a **Total risk-based capital ratio of 14.7%** and **Common Equity Tier 1 ratio of 12.3%** at June 30, 2025[395](index=395&type=chunk)[396](index=396&type=chunk)[397](index=397&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=120&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section discusses the Company's market risk, primarily focusing on interest rate risk inherent in its lending and deposit-taking activities [Interest rate sensitivity](index=120&type=section&id=Interest%20rate%20sensitivity) This subsection details how the company measures and manages its exposure to interest rate fluctuations using rate shock analysis - The Company's market risk primarily stems from interest rate risk, which is actively monitored and managed by the Asset Liability Management Committee (ALCO)[398](index=398&type=chunk)[399](index=399&type=chunk) - Rate shock analysis is used to measure the estimated impact of immediate changes in interest rates on net interest income and economic value of equity (EVE)[400](index=400&type=chunk) **Estimated Impact of Interest Rate Changes on Net Interest Income and EVE** | Change in Interest Rates (in basis points) | Percentage Change in Net Interest Income (June 30, 2025) | Percentage Change in Economic Value of Equity (June 30, 2025) | | :--- | :--- | :--- | | +400 | 8.61% | (18.1)% | | +300 | 7.16% | (13.8)% | | +200 | 5.06% | (8.64)% | | +100 | 2.67% | (3.97)% | | -100 | (2.91)% | 3.10% | | -200 | (5.81)% | 5.12% | - As of June 30, 2025, the Company is in an **asset-sensitive position**, meaning net interest income is projected to increase with rising interest rates and decrease with falling rates[403](index=403&type=chunk) [Item 4. Controls and Procedures](index=122&type=section&id=Item%204.%20Controls%20and%20Procedures) This section confirms the effectiveness of the Company's disclosure controls and procedures and notes no material changes in internal control - The Company's disclosure controls and procedures were evaluated and **deemed effective** as of June 30, 2025, ensuring timely and accurate reporting[406](index=406&type=chunk) - **No material changes occurred** in the Company's internal control over financial reporting during the quarter ended June 30, 2025[407](index=407&type=chunk) - Management acknowledges that no control procedure can prevent all errors and fraud, providing only **reasonable, not absolute, assurance**[408](index=408&type=chunk) [PART II. OTHER INFORMATION](index=123&type=section&id=PART%20II.%20OTHER%20INFORMATION) This part provides information on legal proceedings, risk factors, stock repurchases, and other corporate matters [Item 1. Legal Proceedings](index=123&type=section&id=Item%201.%20Legal%20Proceedings) This section states that there are no material pending legal proceedings against the Company or its subsidiaries beyond the normal course of business - As of the report date, there are **no material pending legal proceedings** against the Company or its subsidiaries[411](index=411&type=chunk) [Item 1A. Risk Factors](index=123&type=section&id=Item%201A.%20Risk%20Factors) This section indicates that there have been no material changes to the risk factors previously disclosed in the Company's Annual Report - **No material changes** to the risk factors have occurred since the Annual Report on Form 10-K for the year ended December 31, 2024[412](index=412&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=123&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section provides information on the Company's common stock repurchases during the quarter ended June 30, 2025 **Common Stock Repurchases (Quarter Ended June 30, 2025)** | Period | Total Number of Shares Purchased | Average Price Paid Per Share | | :--- | :--- | :--- | | April 1 - April 30 | 703,091 | $41.83 | | May 1 - May 31 | 108,613 | $44.59 | | June 1 - June 30 | — | — | | Total | 811,704 | $42.20 | - The Company repurchased **811,704 shares of common stock** at an average price of **$42.20 per share** during the quarter ended June 30, 2025[413](index=413&type=chunk) - The board re-authorized a stock repurchase program for up to **$100 million**, with **$43.15 million remaining** under the program as of June 30, 2025[413](index=413&type=chunk) [Item 5. Other Information](index=123&type=section&id=Item%205.%20Other%20Information) This section states that no directors or executive officers adopted, modified, or terminated any Rule 10b5-1 trading plans during the quarter - No directors or executive officers adopted, modified, or terminated any Rule 10b5-1 trading plans during the quarter ended June 30, 2025[414](index=414&type=chunk) [Item 6. Exhibits](index=124&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed, furnished, or incorporated by reference as part of the Form 10-Q report - The exhibit index includes the **Agreement and Plan of Merger** with Southern States Bancshares, Inc, filed on March 31, 2025[417](index=417&type=chunk) - **Certifications from the Chief Executive Officer and Chief Financial Officer** are filed or furnished with the report[417](index=417&type=chunk) - **Inline XBRL documents** for the instance, schema, calculation, definition, label, and presentation linkbases are included[417](index=417&type=chunk) [SIGNATURES](index=125&type=section&id=SIGNATURES) This section contains the required signatures of the Company's officers, certifying the filing of the Form 10-Q report - The report is duly signed on behalf of FB Financial Corporation by Michael M Mettee, Chief Financial Officer, and Jonathan Pennington, Chief Accounting Officer, on August 4, 2025[419](index=419&type=chunk)[420](index=420&type=chunk)

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Financial Data and Key Metrics Changes - The company reported EPS of $0.06 and adjusted EPS of $0.88 for the quarter, with tangible book value per share growing at a compound annual growth rate of 12.2% since the IPO [5] - Net income on a reported basis was $2.9 million, while adjusted net income was $40.8 million, significantly impacted by a $60 million pre-tax loss from a securities transaction [14][15] - Net interest income increased by 3.5% from the prior quarter and 8.6% year-over-year, reaching $111.4 million [15] - The net interest margin expanded by 13 basis points to 3.68% due to loan growth and cost management [16] Business Line Data and Key Metrics Changes - Loan growth was at an annualized rate of 4.2%, while deposits grew at an annualized rate of 7.2% [10] - Core non-interest income, excluding the securities loss, was $25.8 million, representing a 9% increase over the previous quarter [16] - The company experienced a loss in non-interest income of $34.6 million due to the securities trade [16] Market Data and Key Metrics Changes - The company noted increased market volatility due to trade policy announcements and geopolitical events, which impacted customer behavior and loan activity [7][8] - The loan growth was concentrated in residential mortgages and commercial real estate, with significant increases in specific categories [23] Company Strategy and Development Direction - The merger with Southern States is expected to add immediate scale and accretive earnings, with integration efforts on track for completion by the end of Q3 [11][12] - The company is optimistic about both organic and inorganic growth opportunities, with a focus on capitalizing on market disruptions [12][13] - The company aims to maintain a strong capital position while pursuing additional M&A opportunities in the future [56][82] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to navigate economic uncertainties and highlighted the potential for growth in the coming quarters [9][11] - The outlook for loan growth remains mid to high single digits, with a strong pipeline of opportunities despite some delays in funding [10][37] - The company anticipates a net interest margin in the range of $3.70 to $3.80 for the second half of the year [25] Other Important Information - The company migrated to a new allowance model to enhance forecasting precision, which had a net impact of approximately $395,000 on reserves [19] - The company plans to redeem subordinated debt and trust preferred securities using proceeds from the securities sale [17] Q&A Session Summary Question: Can you elaborate on the margin guidance and the impact of the bond restructuring? - Management confirmed that virtually no securities from Southern States will be brought over, focusing on paying down brokered deposits and optimizing capital [34][35] Question: What is the outlook for loan growth and the current pipeline? - Management reiterated a mid to high single-digit growth outlook, noting that some expected fundings were delayed but overall customer activity remains strong [37][40] Question: Can you provide details on the higher provision for mortgage banking? - The increase in provision was driven by higher LTV loans and changes in economic forecasts, with a focus on maintaining a profitable operating business [49][50] Question: What is the company's stance on future M&A activity? - Management expressed optimism about M&A opportunities, particularly in the $3 billion to $7 billion range, and emphasized readiness to capitalize on market disruptions [56][82] Question: How is the company managing hiring and recruitment? - The company continues to recruit talent, hiring four new revenue producers in the second quarter to prepare for potential market disruptions [60]

Financial Performance - The company reported net income of $2.9 million, with an adjusted net income of $40.8 million[7, 8] - A securities portfolio restructure resulted in a loss of $60 million[7, 9, 23] - Net interest margin (NIM) expanded by 13 bps to 3.68%[7] - Pre-Tax Pre-Provision Net Revenue was $(4.4) million, but adjusted PPNR reached $58.6 million[7] - The efficiency ratio was 105.7%, while the adjusted efficiency ratio was 56.9%[7] Balance Sheet & Credit Quality - Annualized loan held for investment (HFI) growth was 4.2%[7] - Annualized total deposit growth reached 7.2%[7] - ACL coverage ratio stood at 1.51%[7] - Net charge-offs returned to historical levels at an annualized rate of 0.02%[7, 56] - Nonperforming Assets (NPA) to Assets ratio increased by 8 basis points to 0.92%[7] Capital & M&A - Tangible Common Equity to Tangible Assets ratio was 10.4%[7] - CET 1 Ratio was 12.3% and Total Risk-Based Capital was 14.7% (preliminary)[7] - The merger with Southern States Bancshares, Inc closed on July 1, 2025, with conversion expected in 3Q25[7]

Shares of Simulations Plus, Inc SLP fell sharply in pre-market trading after the company reported downbeat third-quarter sales and cut its FY2025 EPS guidance. Simulations Plus reported quarterly earnings of 45 cents per share which beat the analyst consensus estimate of 7 cents pers hare. The company reported quarterly sales of $20.363 million which missed the analyst consensus estimate of $20.878 million. Keybanc analyst Scott Schoenhaus downgraded Simulations Plus from Overweight to Sector Weight. Simula ...

Core Insights - FB Financial (FBK) reported a revenue of $137.41 million for the quarter ended June 2025, marking a year-over-year increase of 7.2% and exceeding the Zacks Consensus Estimate of $135.28 million by 1.58% [1] - The company's EPS for the same period was $0.88, slightly below the consensus estimate of $0.89, reflecting an EPS surprise of -1.12% compared to $0.84 a year ago [1] Financial Performance Metrics - Efficiency Ratio stood at 56.9%, better than the three-analyst average estimate of 57.3% [4] - Net Interest Margin was reported at 3.7%, surpassing the average estimate of 3.6% based on three analysts [4] - Average Earning Assets totaled $12.24 billion, below the two-analyst average estimate of $12.57 billion [4] - Net Charge-offs during the period to Average Loans outstanding were 0%, compared to the average estimate of 0.1% [4] - Mortgage banking income reached $13.03 million, exceeding the three-analyst average estimate of $12.8 million [4] - Total Noninterest income was $26 million, higher than the average estimate of $24.69 million [4] - Net interest income (tax-equivalent basis) was $112.24 million, slightly above the average estimate of $111.95 million [4] - Other Income amounted to $2.54 million, compared to the average estimate of $2.25 million [4] - Service charges on deposit accounts were $3.39 million, slightly below the average estimate of $3.46 million [4] - Net Interest Income was reported at $111.42 million, marginally below the two-analyst average estimate of $111.61 million [4] - ATM and interchange fees totaled $2.88 million, exceeding the two-analyst average estimate of $2.83 million [4] - Investment services and trust income reached $3.92 million, surpassing the two-analyst average estimate of $3.63 million [4] Stock Performance - FB Financial shares have returned +11.6% over the past month, outperforming the Zacks S&P 500 composite's +4% change [3] - The stock currently holds a Zacks Rank 2 (Buy), indicating potential for outperformance in the near term [3]

Core Viewpoint - FB Financial (FBK) reported quarterly earnings of $0.88 per share, slightly missing the Zacks Consensus Estimate of $0.89 per share, but showing an increase from $0.84 per share a year ago, indicating a -1.12% earnings surprise [1] Financial Performance - The company posted revenues of $137.41 million for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 1.58% and up from $128.22 million year-over-year [2] - Over the last four quarters, FB Financial has exceeded consensus EPS estimates two times and topped revenue estimates once [2] Stock Performance and Outlook - FB Financial shares have declined approximately 6.4% since the beginning of the year, contrasting with the S&P 500's gain of 6.4% [3] - The company's earnings outlook is crucial for investors, with current consensus EPS estimates at $1.01 for the coming quarter and $3.79 for the current fiscal year [7] Industry Context - The Zacks Industry Rank for Banks - Northeast is in the top 34% of over 250 Zacks industries, suggesting that the industry outlook can significantly impact stock performance [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked using tools like the Zacks Rank [5][6]

[Financial Summary and Key Metrics](index=4&type=section&id=Financial%20Summary%20and%20Key%20Metrics) This section provides a five-quarter overview of key financial and performance metrics, noting a significant Q2 2025 net income drop to **$2.9 million** due to a noninterest loss, offset by stable adjusted net income, asset/deposit growth, and an expanded net interest margin Q2 2025 Key Financial Highlights | Metric | Q2 2025 | Q1 2025 | Q2 2024 | | :--- | :--- | :--- | :--- | | Net Income | $2.9M | $39.4M | $40.0M | | Adjusted Net Income* | $40.8M | $40.1M | $39.4M | | Diluted EPS | $0.06 | $0.84 | $0.85 | | Adjusted Diluted EPS* | $0.88 | $0.85 | $0.84 | | Total Assets | $13.35B | $13.14B | $12.54B | | Total Deposits | $11.40B | $11.20B | $10.47B | | Net Interest Margin (NIM) | 3.68% | 3.55% | 3.57% | - The company experienced a significant noninterest loss of **$34.6 million** in Q2 2025, a sharp contrast to the $23.0 million income in Q1 2025 and $25.6 million income in Q2 2024[7](index=7&type=chunk) - Asset quality ratios showed an increase in nonperforming loans to **0.97%** of loans HFI, up from **0.79%** in both the prior and year-ago quarters, however, annualized net charge-offs were minimal at **0.02%**[7](index=7&type=chunk) - Capital ratios remained strong, with a Common Equity Tier 1 ratio of **12.3%** and a Total risk-based capital ratio of **14.7%** as of June 30, 2025[7](index=7&type=chunk) [Consolidated Statements of Income](index=6&type=section&id=Consolidated%20Statements%20of%20Income) The Q2 2025 consolidated income statement shows a sharp decline in net income to **$2.9 million** primarily due to a **$60.5 million** net loss from securities, despite growth in net interest income and a slight increase in noninterest expenses including merger costs Q2 2025 Income Statement Highlights (vs. Q1 2025 & Q2 2024) | Item (in thousands) | Q2 2025 | QoQ Change | YoY Change | | :--- | :--- | :--- | :--- | | Net Interest Income | $111,415 | +3.51% | +8.58% | | Total Noninterest (Loss) Income | $(34,552) | -250.0% | -234.9% | | (Loss) from securities, net | $(60,549) | NM | -100.0% | | Total Noninterest Expense | $81,261 | +2.15% | +8.21% | | Net Income | $2,909 | -92.6% | -92.7% | - A significant net loss from securities of **$60.5 million** was the primary driver for the quarter's low net income, this compares to a minimal gain in Q1 2025 and no gain/loss in Q2 2024[10](index=10&type=chunk) - For the six months ended June 30, 2025, net interest income increased by **8.39%** to **$219.1 million** compared to the same period in 2024, however, total revenue decreased by **11.9%** due to the large securities loss[12](index=12&type=chunk) - Merger and integration costs of **$2.7 million** were recorded in Q2 2025, contributing to the rise in noninterest expenses[10](index=10&type=chunk) [Consolidated Balance Sheets](index=8&type=section&id=Consolidated%20Balance%20Sheets) As of June 30, 2025, total assets grew to **$13.35 billion** (up **6.5%** YoY), driven by increased net loans and cash, while total deposits reached **$11.40 billion** (up **8.9%** YoY) and common shareholders' equity rose to **$1.61 billion** Balance Sheet Highlights as of June 30, 2025 (in thousands) | Item | Jun 30, 2025 | vs. Mar 31, 2025 | vs. Jun 30, 2024 | | :--- | :--- | :--- | :--- | | Total Assets | $13,354,238 | +1.66% | +6.53% | | Net Loans HFI | $9,725,334 | +1.08% | +6.24% | | Total Deposits | $11,403,470 | +1.80% | +8.94% | | Borrowings | $164,485 | -2.64% | -54.43% | | Total Common Shareholders' Equity | $1,611,130 | +0.57% | +7.37% | - Cash and cash equivalents increased significantly to **$1.17 billion**, up **46.7%** from the previous quarter and **45.6%** from the prior year[14](index=14&type=chunk) - Within deposits, customer time deposits grew **28.1%** and brokered deposits grew **245.0%** year-over-year, while interest-bearing checking accounts decreased by **11.5%**[14](index=14&type=chunk) [Average Balance and Interest Yield/Rate Analysis](index=9&type=section&id=Average%20Balance%20and%20Interest%20Yield%2FRate%20Analysis) Net interest margin (NIM) improved to **3.68%** in Q2 2025, driven by a higher yield on interest-earning assets (**5.99%**) and a lower cost of interest-bearing liabilities (**3.13%**), with the six-month NIM expanding to **3.61%** Q2 2025 Interest Rate & Margin Analysis | Metric | Q2 2025 | Q1 2025 | Q2 2024 | | :--- | :--- | :--- | :--- | | Net Interest Margin (NIM) | 3.68% | 3.55% | 3.57% | | Yield on Interest-Earning Assets | 5.99% | 5.91% | 6.16% | | Cost of Interest-Bearing Liabilities | 3.13% | 3.16% | 3.56% | | Cost of Total Deposits | 2.48% | 2.54% | 2.77% | | Interest Rate Spread | 2.86% | 2.75% | 2.60% | - The average balance of interest-earning assets was **$12.24 billion** in Q2 2025, a slight decrease from $12.39 billion in Q1 2025[16](index=16&type=chunk) - For the six months ended June 30, 2025, the net interest margin expanded to **3.61%** from 3.49% in the comparable 2024 period, reflecting improved profitability from core lending and investment activities[28](index=28&type=chunk) [Investments and Other Sources of Liquidity](index=15&type=section&id=Investments%20and%20Other%20Sources%20of%20Liquidity) The company's **$1.34 billion** investment portfolio, primarily U.S. government agency and residential mortgage-backed securities, supports a strong liquidity position of **$1.71 billion** on-balance sheet plus **$6.93 billion** from other sources, covering uninsured deposits by **289.5%** Investment Securities Composition (June 30, 2025) | Security Type | Fair Value (in thousands) | % of Total | | :--- | :--- | :--- | | U.S. government agency securities | $642,264 | 48% | | Mortgage-backed securities - residential | $541,343 | 40% | | Municipal securities | $144,228 | 11% | | Other | $9,730 | 1% | | **Total** | **$1,337,565** | **100%** | - Total on-balance sheet liquidity, comprising cash and unpledged securities, stood at **$1.71 billion** at the end of Q2 2025[33](index=33&type=chunk) - The company has access to significant additional liquidity, including **$1.48 billion** in FHLB borrowing capacity and **$2.12 billion** from the Federal Reserve discount window[33](index=33&type=chunk) [Loan Portfolio](index=16&type=section&id=Loan%20Portfolio) The total loan portfolio (HFI) grew to **$9.87 billion** at Q2 2025, remaining diversified across commercial real estate (**36%**), residential real estate (**30%**), and commercial and industrial loans (**18%**), with **82%** concentrated in metropolitan markets and total unfunded commitments at **$2.86 billion** Loan Portfolio Composition (June 30, 2025) | Loan Type | Amount (in thousands) | % of Total | | :--- | :--- | :--- | | Commercial Real Estate (Total) | $3,568,812 | 36% | | Residential Real Estate (Total) | $2,889,383 | 30% | | Commercial and Industrial | $1,788,911 | 18% | | Construction | $1,022,678 | 10% | | Consumer and other | $604,498 | 6% | | **Total Loans HFI** | **$9,874,282** | **100%** | - The loan portfolio is primarily concentrated in metropolitan markets, which account for **$8.08 billion**, or **82%** of the total portfolio[37](index=37&type=chunk) - Total unfunded loan commitments increased to **$2.86 billion**, with commercial and industrial lines of credit (**$1.40 billion**) and residential lines of credit (**$746 million**) being the largest components[37](index=37&type=chunk) [Asset Quality](index=17&type=section&id=Asset%20Quality) Asset quality metrics in Q2 2025 were mixed, with total nonperforming assets increasing to **$123.0 million** (**0.92%** of total assets), while the allowance for credit losses stood at **1.51%** of loans and annualized net charge-offs remained exceptionally low at **0.02%** Key Asset Quality Ratios | Metric | Q2 2025 | Q1 2025 | Q2 2024 | | :--- | :--- | :--- | :--- | | Nonperforming assets as a % of total assets | 0.92% | 0.84% | 0.81% | | Nonperforming loans HFI as a % of loans HFI | 0.97% | 0.79% | 0.79% | | Annualized net charge-offs as a % of avg loans | 0.02% | 0.14% | 0.02% | | Allowance for credit losses as a % of loans HFI | 1.51% | 1.54% | 1.67% | - The allowance for credit losses on loans HFI decreased slightly to **$148.9 million** from **$150.5 million** in the prior quarter, following a **$6.8 million** reduction due to a change in accounting estimate[39](index=39&type=chunk) - Total nonperforming loans HFI increased to **$95.9 million** from **$77.2 million** in the previous quarter, driven by a rise in nonaccrual loans[39](index=39&type=chunk) [Selected Deposit Data](index=18&type=section&id=Selected%20Deposit%20Data) Total deposits reached **$11.40 billion** as of June 30, 2025, primarily sourced from metropolitan markets (**73%**) and evenly split between consumer and commercial customers, with estimated uninsured deposits decreasing to **26.2%**, indicating a more stable funding profile Deposit Composition (June 30, 2025) | Segment | Amount (in thousands) | % of Total | | :--- | :--- | :--- | | **By Market** | | | | Metropolitan | $8,275,006 | 73% | | Community | $2,436,243 | 21% | | Brokered/Wholesale & Other | $692,221 | 6% | | **By Customer** | | | | Commercial | $4,835,968 | 42% | | Consumer | $4,772,582 | 42% | | Public | $1,794,920 | 16% | | **Total** | **$11,403,470** | **100%** | - Estimated uninsured and uncollateralized deposits were **$2.98 billion**, representing **26.2%** of total deposits, showing an improved risk profile compared to 30.6% in June 2024[41](index=41&type=chunk) [Preliminary Capital Ratios](index=19&type=section&id=Preliminary%20Capital%20Ratios) The company's capital position remains robust as of June 30, 2025, with preliminary Common Equity Tier 1 (**12.3%**), Tier 1 risk-based (**12.6%**), and Total risk-based capital ratios (**14.7%**) all well above regulatory minimums, alongside a **10.4%** Tangible Common Equity to Tangible Assets ratio Preliminary Regulatory Capital Ratios (June 30, 2025) | Ratio | Value | | :--- | :--- | | Common Equity Tier 1 (CET1) | 12.3% | | Tier 1 Risk-Based Capital | 12.6% | | Total Risk-Based Capital | 14.7% | | Tier 1 Leverage | 11.3% | | Tangible Common Equity to Tangible Assets* | 10.4% | - Total risk-weighted assets were preliminarily calculated at **$11.59 billion** as of June 30, 2025[45](index=45&type=chunk) [Segment Data](index=20&type=section&id=Segment%20Data) This section details the financial performance of the Banking and Mortgage segments, highlighting their pre-tax contributions, net interest income, and key efficiency metrics [Banking Segment](index=20&type=page&id=Banking%20segment) The Banking segment reported a pre-tax loss of **$6.7 million** in Q2 2025, a significant downturn from the prior quarter's profit, primarily driven by a **$47.7 million** noninterest loss, despite strong net interest income of **$108.9 million** and an improved core efficiency ratio of **52.8%** Banking Segment Performance (Q2 2025) | Metric (in thousands) | Q2 2025 | Q1 2025 | | :--- | :--- | :--- | | Net Interest Income | $108,909 | $105,759 | | Noninterest (Loss) Income | $(47,720) | $10,660 | | Pre-tax Net (Loss) Contribution | $(6,723) | $47,321 | | Total Assets | $12,736,830 | $12,490,097 | | Core Efficiency Ratio* | 52.8% | 56.5% | [Mortgage Segment](index=20&type=page&id=Mortgage%20segment) The Mortgage segment reported a pre-tax loss of **$3.0 million** in Q2 2025, primarily due to higher provisions for credit losses, despite an increase in mortgage banking income to **$13.0 million** and improved mortgage loan sales volume of **$391.1 million** with a **2.86%** sale margin Mortgage Segment Performance (Q2 2025) | Metric (in thousands, except margin) | Q2 2025 | Q1 2025 | | :--- | :--- | :--- | | Mortgage Banking Income | $13,029 | $12,426 | | Pre-tax Net (Loss) Contribution | $(3,012) | $1,511 | | Mortgage Loan Sales | $391,061 | $222,805 | | Mortgage Sale Margin | 2.86% | 2.51% | [Non-GAAP Reconciliations](index=3&type=section&id=Non-GAAP%20Reconciliations) This section explains the company's use of non-GAAP financial measures and provides detailed reconciliations to their GAAP equivalents, offering insights into adjusted performance metrics [Use of non-GAAP Financial Measures](index=3&type=page&id=Use%20of%20non-GAAP%20Financial%20Measures) This section explains the company's use of non-GAAP financial measures, which management believes provide a clearer understanding of ongoing operations and enhance period-to-period comparability by excluding non-core or non-recurring items, serving as a supplement to GAAP measures - The company uses non-GAAP measures such as adjusted net income, adjusted EPS, core revenue, core noninterest expense, core efficiency ratio, and various tangible equity metrics[4](index=4&type=chunk) - Management uses these metrics to analyze performance, financial condition, and operational efficiency, believing they enhance comparability by removing the effects of significant non-core gains and charges[5](index=5&type=chunk) [Reconciliation Tables](index=21&type=page&id=Reconciliation%20Tables) This section provides detailed tables reconciling GAAP financial measures to their non-GAAP counterparts, including adjustments for securities gains/losses, merger costs, and amortization of intangibles to derive metrics such as Adjusted Net Income and Core Efficiency Ratio Reconciliation of Net Income to Adjusted Net Income (Q2 2025) | Item (in thousands) | Amount | | :--- | :--- | | Net Income (GAAP) | $2,909 | | Adjustments: | | | (Loss) from securities, net | $(60,549) | | Merger and integration costs | $2,734 | | Other adjustments | $236 | | Tax impact of adjustments | $(3,778) | | Non-recurring tax benefit | $(8,713) | | **Adjusted Net Income (Non-GAAP)** | **$40,821** | Reconciliation of Total Noninterest Expense to Core Noninterest Expense (Q2 2025) | Item (in thousands) | Amount | | :--- | :--- | | Total Noninterest Expense (GAAP) | $81,261 | | Less: Merger and integration costs | $2,734 | | **Core Noninterest Expense (Non-GAAP)** | **$78,527** |

Core Viewpoint - Analysts project that FB Financial (FBK) will report quarterly earnings of $0.89 per share, a 6% increase year over year, with revenues expected to reach $135.28 million, reflecting a 5.5% increase from the same quarter last year [1]. Earnings Estimates - The consensus EPS estimate has been revised 2% higher over the last 30 days, indicating a collective reevaluation by analysts [2]. - Changes in earnings estimates are crucial for predicting investor reactions, as empirical research shows a strong correlation between earnings estimate revisions and short-term stock performance [3]. Key Financial Metrics - Analysts expect the 'Efficiency Ratio' to be 57.2%, down from 58.6% in the same quarter last year [5]. - The 'Net Interest Margin' is projected to remain stable at 3.6%, consistent with the previous year's figure [5]. - 'Average Earning Assets' are expected to reach $12.57 billion, up from $11.63 billion in the same quarter last year [6]. - 'Mortgage banking income' is estimated at $12.80 million, compared to $11.91 million a year ago [6]. - 'Total Noninterest income' is projected to be $24.69 million, down from $25.61 million in the same quarter last year [7]. - 'Net interest income (tax-equivalent basis)' is expected to be $111.97 million, up from $103.25 million in the same quarter last year [7]. - The consensus estimate for 'Other Income' is $2.25 million, down from $4.61 million a year ago [8]. - 'Service charges on deposit accounts' are projected to reach $3.46 million, slightly up from $3.17 million last year [8]. - 'Net Interest Income' is expected to be $111.61 million, compared to $102.62 million in the same quarter last year [8]. - 'Investment services and trust income' is projected at $3.63 million, up from $3.39 million in the same quarter last year [9]. Stock Performance - FB Financial shares have increased by 6.1% over the past month, outperforming the Zacks S&P 500 composite, which rose by 3.9% [9]. - FBK holds a Zacks Rank 2 (Buy), indicating expectations of outperforming the overall market in the near future [9].