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- **Revenue Growth**: 7.8% YoY loan growth, 9% YoY deposit growth, net interest income up 21%.
- **Margin Expansion**: 3.48% net interest margin, 3.5x operating leverage, 24% payout ratio.
- **Strategic Moves**: $100 million ag lending expansion, $800 million Napoleon market pursuit, wealth management partnership.
- **Credit Strength**: 1.44% allowance coverage, 25bps NPA target, 45bps delinquency rate.
- **Mortgage Outlook**: 2026 originations targeting $320-350 million with rates below 6%.

**【Management Opening Remarks】**
- CEO Mark Klein highlighted Q3 net income of $4 million and EPS of $0.64, up 83% YoY. Loan growth of 7.8% YoY and deposit growth of $103 million (9% YoY) driven by Marblehead integration and new market entry in Napoleon, Ohio.
- Emphasized disciplined lending, core deposit growth, and expense management. Mortgage originations at $67.6 million, with pipeline strengthening as 30-year rates fall below 6%.

**【CEO Commentary】**
- Q3 net interest income up 21% YoY to $12.3 million. Loan growth of $80.6 million (7.8% YoY) across Columbus and CRE. Deposit growth of $103 million (9% YoY), with $51 million from Marblehead.
- Tangible book value per share increased 4.4% to $17.21. Mortgage servicing rights up 7%, adding $175k annual revenue. Wealth management partnership with Advisor Alpha to expand client base.
- Operating leverage improved to 3.5x, with expenses up 9.5% YoY vs 18.5% revenue growth. Mortgage originations focused on purchase (80%) and construction (7%), with minimal refinancing.

**【CFO Financial Commentary】**
- GAAP net income $420 million, Non-GAAP EPS $1.08 (vs $0.80 prior year). Net interest margin 3.48%, up 18bps YoY. Funding costs stable at 2.33%, lowest since 2024Q3.
- Fee income $4.2 million (2.9% YoY growth). Mortgage banking contribution $1.5 million, up 10% YoY. Buyback of 101k shares ($4.5 million YTD) at 115% TBV.
- Asset quality: Charge-offs 0bps, NPA 25bps target. Allowance 1.44% of loans, 345% coverage of NPAs. Delinquencies 45bps, down 1.7 million YoY.

**【Q&A Highlights】**
- **Loan Growth**: Expect $15-20 million Q4 growth, targeting $80-100 million 2026. Ag lending expansion with $100 million portfolio target. Liquidity of $75 million to fund loans at 300bps spread.
- **Margin Outlook**: 3.5% peak for 2025Q3, stable in 2026 with asset repricing offsetting funding cost increases. 75bps rate decline would reduce HELOC income by $350k annually.
- **Credit Quality**: Target NPA 25bps, reserve 1.25-1.30%. $500k-$1 million NPAs expected to resolve in 6 months. CECL modeling may limit reserve reductions.
- **Mortgage Volume**: Q4 originations $80 million, 2026 targeting $320-350 million if rates stay below 6%. Refinance mix could rise to 20% if rates stabilize.
- **Capital Allocation**: Slowing buybacks to retain capital for potential M&A. Debt refinancing consideration in 2026. Dividend yield 3.1%, payout ratio 24%.

SB Financial Group, Inc. (SBFG) Q3 2025 Earnings Call Transcript

Revenue

Sales and Services Revenue

Financing Services Revenue

Other Revenue

Cost of Revenue

Cost of Goods and Services

Cost of Financing Services

Other Cost

Gross Profit

Other Operating Income

Operating Expenses

Selling, General and Administrative Expenses

Selling and Marketing Expenses

General and Administrative Expenses

Research and Development Expenses

Loss on Bad Debts

Loss on Impairment of Other Assets

Loss on Disposal of Assets

Other Operating Expenses

Operating Income

Non-Operating Income (Loss)

Income (Loss) from Affiliates

Income (Loss) from Associates

Income (Loss) from Joint ventures

Gain (Loss) on Other Investment

Gain (Loss) on Change in Fair Value

Gain (Loss) on Foreign Currency Exchange

Other Non-Operating Income (Loss)

Net Interest Expense

Interest Expense

Interest Income

Pretax Income From Continuing Operations

Income Tax Expense

Current Income Tax

Deferred Income Tax

Income Tax Adjustments

Net Income from Continuing Operations

Income from Discontinued Operations

Other Items Before Net Income

Net Income

Net Income Attributable to Minority Interests

Net Income Attributable to Owners of the Company

Preferred Stock Dividends

Other Adjustments

Net Income Attributable to Common Stockholders

Other Comprehensive Income

Total Comprehensive Income

Total Comprehensive Income Attributable to Minority Interests

Total Comprehensive Income Attributable to Owners of the Company

Basic EPS

Basic EPS from Continuing Operations

Basic EPS from Discontinued Operations

Diluted EPS

Diluted EPS from Continuing Operations

Diluted EPS from Discontinued Operations

SBFG

SBFG fundamentals

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