Financial Performance - Net income for Q1 2025 was $2.2 million, a decrease of 8.9% from $2.4 million in Q1 2024, with diluted earnings per share at $0.33 compared to $0.35[159] - Operating revenue for Q1 2025 was $15.4 million, an increase of $2.3 million or 17.2% from $13.1 million in Q1 2024[161] - Net interest income for Q1 2025 was $11.3 million, up from $9.2 million in Q1 2024, with a net interest margin of 3.40% compared to 2.99%[162] - Total noninterest income for Q1 2025 was $4.1 million, slightly up from $4.0 million in Q1 2024, with SBFG Title contributing $0.4 million[163] - Total noninterest expense for Q1 2025 was $12.4 million, an increase of $2.1 million from $10.3 million in Q1 2024, including over $0.7 million in merger-related expenses[165] - Income taxes for Q1 2025 were $0.43 million, representing an effective tax rate of 16.7%, compared to $0.48 million and 16.9% in Q1 2024[166] Loan and Asset Management - Total loans reached $1.09 billion, an increase of $41.5 million or 4.0% from year-end 2024[167] - Total delinquent loans at the end of Q1 2025 were $5.9 million, representing 0.54% of total loans[160] - The allowance for credit losses was $15.4 million, reflecting a $0.3 million increase from December 2024[169] - Non-performing asset ratio remained stable at 41 basis points with coverage on non-performing loans at 254%[169] - The commercial real estate and mortgage portfolios totaled $890.3 million, which can be used to collateralize borrowings[174] Deposits and Assets - Total assets increased to $1.5 billion, up $121.5 million or 8.8% since December 31, 2024[167] - Total deposits rose to $1.27 billion, up $118.6 million or 10.3% since the end of 2024[167] - Liquid assets totaled $310.7 million, an increase from $235.9 million at December 31, 2024[172] Cash Flow - Net cash provided by operating activities was $6.7 million for the three months ended March 31, 2025, compared to $0.3 million for the same period in 2024[176] - Net cash provided by financing activities was $63.3 million for the three months ended March 31, 2025, compared to a net cash used of $8.4 million in the prior year[178] Credit Losses - Provision for credit losses for Q1 2025 was $387,000, compared to zero in Q1 2024, with net charge-offs of $84,000 versus $57,000 in the prior year[160] - State Bank originated $39.8 million in mortgage loans during Q1 2025, with $39.3 million sold, resulting in $0.9 million of gains[164] Borrowing Capacity - The Company had approximately $145.4 million of additional borrowing capacity as of March 31, 2025[180]

Financial Performance - Net income for Q1 2025 was $2.7 million, with diluted earnings per share of $0.42, a 27% increase compared to the prior year[7]. - Noninterest income increased by 3.9% year-over-year to $4.1 million, driven by gains on mortgage loans and commercial loan swap revenue[12]. - Operating expenses totaled $12.4 million, including $726,000 in merger-related expenses, resulting in a 3.5% increase from the linked quarter[25]. - The company announced a dividend of $0.15 per share, yielding approximately 3.16% and representing 45% of earnings, with expectations to normalize the payout ratio to around 30%[33]. - Tangible book value per share increased by 5.8% year-over-year, but decreased by $0.21 from the previous quarter due to merger impacts[30]. - The company plans to continue increasing its dividend policy over the coming years[60]. - Earnings improvement and AOCI are expected to drive capital levels stable to higher[60]. Loan and Deposit Growth - Loan growth for the quarter was $97 million, representing a 9.8% increase from the prior year, marking the fourth consecutive quarter of sequential loan growth[8]. - Total loans ended the quarter at $1.09 billion, with a net interest margin improvement to 3.4%, up 5 basis points from the linked quarter[26]. - The Marblehead acquisition added $56 million in low-cost deposits and a $19 million loan book, enhancing the company's market position in Ottawa County, Ohio[13]. - Deposits grew over 10%, including $56 million from the Marblehead acquisition, with core deposit growth of just under 5% for an annualized growth rate of 15%[15]. - Loan growth is projected at 8% to 10% for the year, including Marblehead's $20 million contribution[42]. - The company anticipates a core deposit growth of 4% to 5% despite potential seasonal declines in the second quarter[48]. Asset Quality - Charge-offs fell to 3 basis points, with nonperforming assets totaling $6.1 million, representing 41 basis points of total assets[20]. - Total delinquencies decreased to 54 basis points, with a total provision expense of $387,000 for the quarter[31]. - The reserve level is currently at $141 million, with expectations to provision quarterly to keep pace with anticipated loan growth[55]. Strategic Initiatives - The digital banking strategy includes appointing a Digital Banking Officer to enhance cybersecurity and client care initiatives[17]. - The company is optimistic about capital management, focusing on rebuilding post-merger and considering future M&A opportunities[59]. - CET1 capital level remains above 12%, indicating stability and potential for buybacks[60]. Future Outlook - The company anticipates a stronger summer volume in mortgage originations, with a current pipeline of approximately $50 million[9]. - The mortgage pipeline is currently in the low 50s, with expectations to achieve around $380 million in mortgage volume for 2025[45]. - The gain on sale margins have remained stable in the range of $220 million to $225 million[46]. - The next earnings report is scheduled for July, covering the second quarter of 2025[63].

Financial Data and Key Metrics Changes - Net income for the first quarter was $2,700,000, with diluted earnings per share (EPS) of $0.42, representing a 27% increase compared to the prior year quarter [5] - Tangible book value per share increased to $15.79, up from $14.93 last year, marking a 5.8% increase [5] - Net interest income totaled $11,300,000, a 23% increase from $9,200,000 in the first quarter of the previous year [5][19] - Operating expenses rose approximately 3.5% from the linked quarter, totaling $12,400,000, which includes $726,000 in merger-related expenses [7][21] Business Line Data and Key Metrics Changes - Loan growth for the quarter was $97,000,000, up 9.8% from the prior year, marking the fourth consecutive quarter of sequential loan growth [6][13] - Mortgage originations for the quarter were $40,000,000, down from the prior year and linked quarters, but the current pipeline is approximately $50,000,000 [6][8] - Noninterest income increased by 3.9% from the prior year quarter to $4,100,000, driven by gains on mortgage loans and commercial loan swap revenue [10] Market Data and Key Metrics Changes - Deposits grew over 10%, including $56,000,000 from the Marblehead acquisition, while excluding Marblehead, growth was 5.4% [6][12] - The deposit base ended the quarter at $1,270,000,000, the highest level in the company's history [24] - Demand deposits expanded by $8,000,000 or 3% for an annualized growth rate of 12% [25] Company Strategy and Development Direction - The company remains focused on five key initiatives: growing and diversifying revenue, expanding footprint, operational excellence, and maintaining asset quality [7] - The acquisition of Marblehead Bancorp is expected to enhance market presence and provide tailored financial solutions to clients [11] - The company is committed to digital innovation and enhancing client care initiatives to remain competitive against larger regional banks [15][16] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in loan growth despite economic uncertainties, with a budgeted growth of 8% to 10% for the year [40] - The company anticipates continued improvement in net interest margin due to lower funding costs and loan repricing [20][56] - Management remains optimistic about the economic environment and client situations, despite potential concerns regarding tariffs [39][57] Other Important Information - The company repurchased 26,500 shares at an average price of just under $21, representing approximately 130% of tangible book value [26] - The allowance for credit losses remained robust at 1.41% of total loans, providing 254% coverage of nonperforming loans [18] Q&A Session Summary Question: Outlook on loan growth and impact of tariffs - Management is confident in the loan pipeline and does not foresee significant pullback from clients due to tariffs, although economic uncertainty exists [36][39] Question: Expectations for mortgage volume and pipeline - The current mortgage pipeline is healthy, and management is optimistic about achieving budgeted numbers for the year [42][43] Question: Deposit trends and liquidity outlook - Management expects some seasonal fluctuations in deposits but anticipates core deposit growth to remain strong [49] Question: Credit quality and reserve levels - Management is bullish on credit quality and expects to maintain reserve levels while provisioning for anticipated loan growth [58][61] Question: Capital management priorities post-acquisition - The company plans to stabilize capital levels and may resume share buybacks when opportunities arise [66]

Financial Data and Key Metrics Changes - Net income for the first quarter was $2,700,000, with diluted earnings per share (EPS) of $0.42, representing a 27% increase compared to the prior year quarter [5] - Tangible book value per share increased to $15.79, up from $14.93 last year, marking a 5.8% increase [5] - Net interest income totaled $11,300,000, a 23% increase from $9,200,000 in the first quarter of 2024 [5] - Operating expenses increased approximately 3.5% from the linked quarter, totaling $12,400,000, which includes $726,000 in merger-related expenses [7][21] Business Line Data and Key Metrics Changes - Loan growth for the quarter was $97,000,000, up 9.8% from the prior year, marking the fourth consecutive quarter of sequential loan growth [6][13] - Mortgage originations for the quarter were $40,000,000, down from the prior year and linked quarters, but the current pipeline is approximately $50,000,000 [6][8] - Noninterest income increased by 3.9% from the prior year quarter to $4,100,000, driven by gains on mortgage loans and commercial loan swap revenue [10] Market Data and Key Metrics Changes - Deposits grew over 10%, including $56,000,000 from the Marblehead acquisition, while excluding Marblehead, growth was 5.4% [6][12] - The deposit base ended the quarter at $1,270,000,000, the highest level in the company's history [23] - Demand deposits expanded by $8,000,000 or 3% for an annualized growth of 12% [24] Company Strategy and Development Direction - The company remains focused on five key initiatives: growing and diversifying revenue, expanding footprint, operational excellence, and maintaining asset quality [7] - The acquisition of Marblehead Bancorp is expected to enhance market presence and provide tailored financial solutions to clients [11] - The company is committed to digital innovation and enhancing client care initiatives to remain competitive against larger regional banks [15][16] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in loan growth despite economic uncertainties, with a budgeted growth of 8% to 10% for the year [39] - The company anticipates continued improvement in net interest margin due to lower funding costs and loan repricing [20][55] - Management remains optimistic about the economic environment and the company's ability to grow in new markets [38][56] Other Important Information - The company repurchased 26,500 shares at an average price of just under $21, representing approximately 130% of tangible book value [25] - The allowance for credit losses remained robust at 1.41% of total loans, providing 254% coverage of nonperforming loans [18] Q&A Session Summary Question: Concerns about loan growth and tariffs - Management expressed confidence in the loan pipeline, indicating that most clients are proceeding with funding despite economic uncertainties related to tariffs [35][36] Question: Outlook for loan growth this year - The company budgeted for loan growth of 8% to 10%, inclusive of the Marblehead acquisition [39] Question: Mortgage pipeline and full-year expectations - The current mortgage pipeline is healthy, and management is optimistic about achieving budgeted mortgage volume for the year [42] Question: Deposit trends and seasonality - Management anticipates some seasonal fluctuations in deposits but expects core deposits to grow by 4% to 5% [48] Question: Credit quality and reserve levels - Management indicated that credit quality remains strong, with no immediate concerns, and reserves are expected to be maintained [56][60] Question: Capital priorities post-acquisition - The company plans to stabilize capital levels post-acquisition while considering future buybacks and dividend policies [64][66]

Financial Data and Key Metrics Changes - Net income for Q1 2025 was $2.7 million, with diluted earnings per share (EPS) of $0.42, representing a 27% increase compared to the prior year quarter [5] - Tangible book value per share increased to $15.79, up from $14.93 last year, reflecting a 5.8% increase [5] - Net interest income totaled $11.3 million, a 23% increase from $9.2 million in Q1 2024 [5][19] - Operating expenses rose approximately 3.5% from the linked quarter, totaling $12.4 million, which includes $726,000 in acquisition-related costs [7][21] Business Line Data and Key Metrics Changes - Loan growth for the quarter was $97 million, up 9.8% from the prior year, marking the fourth consecutive quarter of sequential loan growth [6][13] - Mortgage originations for the quarter were $40 million, down from the prior year and linked quarters, but the current pipeline is approximately $50 million [6][41] - Noninterest income increased by 3.9% from the prior year quarter to $4.1 million, driven by gains on mortgage loans and commercial loan swap revenue [10] Market Data and Key Metrics Changes - Deposits grew over 10%, including $56 million from the Marblehead acquisition, while excluding Marblehead, growth was 5.4% [6][12] - The core deposit base grew just under 5% this year, with an annualized growth rate of 15% when excluding public funds and the Marblehead book [13] - Total loans ended the quarter at $1.09 billion, including $19 million from the Marblehead acquisition [22] Company Strategy and Development Direction - The company remains focused on five key initiatives: growing and diversifying revenue, expanding footprint, operational excellence, and maintaining asset quality [7] - The Marblehead acquisition, completed on January 17, 2025, is expected to enhance market presence and client relationships in Ottawa County, Ohio [11] - The company is committed to digital innovation and enhancing client care initiatives, including appointing a digital banking officer [15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in loan growth despite economic uncertainties, with a budgeted growth of 8% to 10% for the year [39] - The company anticipates a strong performance in the second half of the year, driven by the integration of Marblehead and a robust loan pipeline [28] - Management expects funding costs to decrease further, which will positively impact net interest margin [23][54] Other Important Information - The company repurchased 26,500 shares at an average price of just under $21, representing approximately 130% of tangible book value [25] - The allowance for credit losses remained robust at 1.41% of total loans, providing 254% coverage of nonperforming loans [18] Q&A Session Summary Question: Concerns about loan growth and tariffs - Management expressed confidence in the loan pipeline, indicating no significant concerns regarding tariffs affecting client decisions [36][38] Question: Outlook for loan growth this year - The company maintains a budgeted growth of 8% to 10%, including contributions from the Marblehead acquisition [39] Question: Mortgage pipeline and full-year expectations - The current mortgage pipeline is healthy, and management is optimistic about achieving budgeted production levels for 2025 [41] Question: Trends in deposits and liquidity - Management anticipates some seasonal fluctuations in deposits but expects core deposits to continue growing [45][47] Question: Credit quality and reserve levels - Management is bullish on credit quality and plans to provision for anticipated loan growth while maintaining a strong reserve level [56][59] Question: Capital management and buyback plans - The company plans to resume share buybacks when opportunities arise, while also focusing on integrating the Marblehead acquisition [64]

Core Insights - SB Financial Group, Inc. (SBFG) reported quarterly earnings of $0.42 per share, exceeding the Zacks Consensus Estimate of $0.40 per share, and up from $0.33 per share a year ago, representing a 5% earnings surprise [1] - The company posted revenues of $15.39 million for the quarter ended March 2025, surpassing the Zacks Consensus Estimate by 7.59%, compared to $13.13 million in the same quarter last year [2] - SBFG has outperformed consensus EPS estimates three times over the last four quarters and has topped consensus revenue estimates four times during the same period [2] Future Outlook - The stock's immediate price movement will depend on management's commentary during the earnings call and the sustainability of earnings expectations [3][4] - The current consensus EPS estimate for the upcoming quarter is $0.54 on revenues of $14.6 million, and for the current fiscal year, it is $2 on revenues of $58.9 million [7] - The estimate revisions trend for SBFG is mixed, resulting in a Zacks Rank 3 (Hold), indicating expected performance in line with the market [6] Industry Context - The Banks - Northeast industry, to which SBFG belongs, is currently in the top 30% of over 250 Zacks industries, suggesting a favorable outlook compared to the bottom 50% [8]

Core Insights - SB Financial Group, Inc. reported a strong first quarter for 2025, highlighting growth in operating revenue and net interest income despite a slight decline in net income compared to the previous year [1][2][4]. Financial Performance - Operating revenue increased by 17.2% to $15.4 million compared to $13.1 million in the prior year [3][6]. - Interest income rose by 13.5% to $17.4 million, driven by strong loan growth [3][4]. - Net interest income grew by 22.9% to $11.3 million, reflecting higher interest income on loans [3][6]. - Noninterest income increased by 3.9% to $4.1 million, attributed to gains on sales of mortgage loans and title insurance [3][10]. - Net income for the quarter was $2.2 million, down 8.9% from $2.4 million in the prior year [3][4]. Loan and Deposit Growth - Total loans increased by $96.7 million, or 9.8%, year-over-year, with $41.5 million growth from the linked quarter [4][13]. - Total deposits rose to $1.27 billion, a growth of $158.9 million or 14.3% year-over-year, including $56 million from the Marblehead Bank acquisition [5][14]. - The company achieved its fourth consecutive quarter of loan growth, with organic loan growth of $78.2 million [16]. Asset Quality - Nonperforming assets totaled $6.1 million, representing 0.41% of total assets, an increase from 0.22% in the prior year [20][21]. - The allowance for credit losses was 1.41% of total loans, providing 254.4% coverage of nonperforming loans [21][22]. Strategic Initiatives - The successful acquisition of Marblehead Bank significantly strengthened liquidity through low-cost deposits and expanded market presence in Northern Ohio [4][16]. - The company remains focused on maintaining a balanced strategy for sustainable revenue growth while managing costs effectively [6][10]. Shareholder Value - Tangible book value per share increased by 5.8% to $15.79, reflecting management's commitment to enhancing shareholder value [4][14]. - The company repurchased 26,446 shares during the quarter, indicating a dedication to returning value to shareholders [15].

Company Overview - SB Financial Group, Inc. (SBFG) is based in Defiance and operates in the Finance sector, with a year-to-date share price change of -6.03% [3] - The company currently pays a dividend of $0.14 per share, resulting in a dividend yield of 2.95%, which is slightly below the Banks - Northeast industry's yield of 3.08% and above the S&P 500's yield of 1.67% [3] Dividend Performance - The current annualized dividend of SBFG is $0.58, reflecting a 3.6% increase from the previous year [4] - Over the past five years, SBFG has increased its dividend five times, achieving an average annual increase of 9.97% [4] - The company's payout ratio stands at 34%, indicating that it distributes 34% of its trailing 12-month earnings per share as dividends [4] Earnings Growth Expectations - For the fiscal year, SBFG anticipates solid earnings growth, with the Zacks Consensus Estimate for 2025 projected at $2 per share, representing a year-over-year growth rate of 16.96% [5] Investment Considerations - SBFG is considered a compelling investment opportunity due to its strong dividend profile and current Zacks Rank of 3 (Hold) [7] - Income investors are advised to be cautious as high-yielding stocks may face challenges during periods of rising interest rates [7]

Core Points - SB Financial Group, Inc. is set to release its first quarter 2025 financial results on May 1, 2025, after market close [1] - A conference call and webcast will follow on May 2, 2025, at 11:00 a.m. EDT [1] Company Overview - SB Financial Group is headquartered in Defiance, Ohio, and operates as a diversified financial services holding company [3] - The company includes The State Bank and Trust Company and SBFG Title, LLC, providing a range of services such as wealth management, mortgage banking, and commercial lending [3] - State Bank operates 26 offices across Ohio and Indiana, along with six loan production offices in the Tri-State region [3] - SB Financial Group's common stock is listed on NASDAQ under the ticker symbol "SBFG" [3] Investor Contact Information - Mark A. Klein serves as Chairman, President, and CEO, reachable at 419-783-8920 [4] - Anthony V. Cosentino is the Executive Vice President and CFO, available at 419-785-3663 [4]

Company Operations - SB Financial Group, Inc. operates through its subsidiaries, including State Bank, which has 25 banking centers and 7 loan production offices as of December 31, 2024[16]. - At December 31, 2024, State Bank had 244 full-time equivalent employees, while SBFG Title had 8 full-time equivalent employees[16][17]. - The company dissolved four inactive subsidiaries in December 2024, indicating a strategic move to streamline operations[22]. - The Company employed approximately 252 full-time equivalent employees as of December 31, 2024, and management considers its relationship with its employees to be good[97]. - The Company has a low annualized voluntary turnover rate, attributed to its strong values-based culture and commitment to career development[96]. Financial Performance - State Bank had $24.7 million of excess earnings over the preceding three years as of December 31, 2024, which may influence future dividend declarations[37]. - Net income for the year ended December 31, 2024, was $11.47 million, a decrease from $12.10 million in 2023[210]. - The cash dividend declared per common share increased to $0.56 in 2024 from $0.52 in 2023[210]. - The Company paid quarterly dividends of $0.56 per share in 2024, up from $0.52 per share in 2023, indicating a 7.69% increase[192]. - For the twelve months ended December 31, 2024, the Company generated $17.0 million in noninterest income, accounting for 29.9% of total operating revenue, compared to $17.7 million or 31.1% in 2023[201]. Regulatory Compliance - The company is subject to the Bank Holding Company Act and must maintain a minimum common equity tier 1 capital ratio of 4.5% as per Basel III Capital Rules[45]. - The Federal Reserve Board requires all depository institutions to maintain reserves at specified levels, with the reserve requirement ratio at 0% as of December 31, 2024[34]. - The company must obtain prior approval from the Federal Reserve Board for significant acquisitions or mergers, ensuring regulatory compliance[28]. - The Company is subject to the jurisdiction of the SEC and NASDAQ regulations, ensuring compliance with corporate governance and reporting requirements[67][68]. - The Company continues to qualify under the Small Bank Holding Company Policy Statement for exemption from the FRB's consolidated risk-based capital and leverage rules at the holding company level[57]. Market and Competition - The company faces significant competition in attracting depositors and borrowers, primarily from other commercial banks and financial technology companies[23][24]. - Recent bank failures, including Silicon Valley Bank and Signature Bank, have created panic and uncertainty in the investor community, potentially affecting customer confidence and liquidity sources[127]. - The company faces strong competition in attracting deposits and originating loans, which may require adjustments to interest rates that could adversely affect net interest margins[144]. Risk Management - The Company is exposed to operational risks, including cybersecurity risks and potential disruptions in communications and information systems[123]. - Cybersecurity threats remain a significant concern, with potential breaches leading to reputational damage, loss of customer business, and increased regulatory scrutiny[138]. - The reliance on third-party service providers poses risks related to cybersecurity and operational disruptions, which could adversely affect the company's operations[140]. - The Company has not detected significant data loss or material financial losses related to cybersecurity attacks, but acknowledges ongoing threats[89]. - The Company’s risk management program includes regular assessments conducted by third-party experts and internal audits[178]. Economic Conditions - The company’s success depends significantly on local and national economic conditions, particularly in Northwest and Central Ohio, where a significant portion of lending relates to real estate[104]. - The company’s financial condition may be adversely impacted by increased delinquencies and credit losses if real estate markets or the economy deteriorate[115]. - The company may experience significant credit losses if actual credit losses exceed the ACL, which could adversely affect operating results[111]. Capital and Assets - As of December 31, 2024, State Bank was in compliance with all regulatory capital requirements and met the standards for the highest capital category, a "well-capitalized" bank[55][56]. - Total assets increased by $121.7 million, or 9.7%, over the last five years, with loans growing by $174.0 million or 19.9% and deposits by $103.6 million or 9.9%[207]. - The Company reported total deposits of $1,152,605 thousand as of December 31, 2024[182]. - As of December 31, 2024, total nonperforming assets were $5.5 million, or 0.40% of total assets, up from $3.3 million or 0.25% in 2023[206]. Strategic Initiatives - The company completed the acquisition of Marblehead Bancorp, Inc. and its banking subsidiary, The Marblehead Bank, on January 17, 2025[121]. - The Company established a presence in Ottawa County with the acquisition of The Marblehead Bank on January 17, 2025[202][208]. - The Company has expanded its operational footprint by opening three branch offices and acquiring two full-service title agencies in the past five years[208]. Environmental and Social Governance - The company may face increasing scrutiny regarding its environmental, social, and governance practices, which could impact its reputation and operational costs[170]. - Environmental liability risks are associated with lending activities, particularly when foreclosing on properties that may contain hazardous substances, potentially leading to significant remediation costs[147]. Shareholder Information - The Company’s common shares are traded on the NASDAQ Capital Market under the symbol "SBFG," with 6,493,526 shares outstanding as of December 31, 2024[191]. - A limited trading market for the company's common shares may lead to price volatility, affecting shareholders' ability to sell shares at desired prices[160]. - The market price of the company's common shares may fluctuate significantly due to changes in market sentiment and external economic factors[162].