Core Viewpoint - The financial performance of Financial Institutions, Inc. for the fourth quarter and full year 2025 demonstrates strong organic growth across its commercial banking, consumer banking, and wealth management sectors, with significant improvements in net income and operational efficiency [1][5]. Financial Performance - The Company reported a net income of $20.0 million for Q4 2025, a slight decrease from $20.5 million in Q3 2025, and a significant recovery from a net loss of $82.8 million in Q4 2024. Net income available to common shareholders was $19.6 million, or $0.96 per diluted share [2]. - For the full year 2025, net income reached $74.9 million, compared to a net loss of $41.6 million in 2024. Net income available to common shareholders was $73.4 million, or $3.61 per diluted share [3]. Key Highlights - The Company achieved a return on average assets of 1.20% and a return on average equity of 12.38% for 2025, with an efficiency ratio of 58% [5]. - Loan growth for the year was 4%, with a notable 6% annualized growth in Q4 2025, driven by strong demand from commercial borrowers [5]. - Total loans amounted to $4.66 billion at year-end 2025, reflecting a 1.5% increase from Q3 2025 and a 4.0% increase from Q4 2024 [6][22]. Income and Expenses - Net interest income reached record levels of $52.2 million for Q4 2025 and $200.0 million for the full year, with a net interest margin of 3.53% for 2025, up 67 basis points year-over-year [6][14]. - Noninterest income for Q4 2025 was $11.9 million, compared to $12.1 million in Q3 2025, and $45.0 million for the full year, recovering from a net loss of $46.7 million in 2024 [15][16]. - Noninterest expenses were $36.7 million for Q4 2025, up from $35.9 million in Q3 2025, but down from $59.4 million in Q4 2024, with full-year expenses totaling $142.0 million, a decrease from $178.9 million in 2024 [17][18]. Capital Management - The Company completed a private placement of $80.0 million in subordinated notes in December 2025, enhancing its capital position and receiving a BBB- rating from Kroll Bond Rating Agency [6][7]. - Shareholders' equity increased to $628.9 million at year-end 2025, up from $621.7 million in Q3 2025 and $569.0 million in Q4 2024, primarily due to retained earnings and a reduction in accumulated other comprehensive loss [25]. Credit Quality - Non-performing loans were $35.8 million, or 0.77% of total loans, at year-end 2025, a decrease from 0.92% a year earlier [30]. - The allowance for credit losses on loans to total loans ratio was 1.02% at year-end 2025, down from 1.07% a year prior, reflecting improved credit quality [31]. Shareholder Returns - The Company declared a common stock dividend of $0.31 per share for Q4 2025, consistent with the previous quarter and representing a 3.3% increase from the prior year [28]. - A total of 336,869 common shares were repurchased at an average price of $31.98 per share during Q4 2025, with additional shares remaining available for repurchase under the plan [29].