LEAWOOD, Kan., Oct. 28, 2025 (GLOBE NEWSWIRE) -- First Busey Corporation (Nasdaq: BUSE) Announces 2025 Third Quarter Earnings.

MESSAGE FROM OUR CHAIRMAN & CEO
We continued to optimize our balance sheet to be more efficient and profitable with adjusted return on average assets⁽²⁾ improving to 1.33% and net interest margin⁽²⁾ expanding 9 basis points to 3.58% in the third quarter, driven by the intentional runoff of $794.6 million high-cost, non-relationship deposits with a weighted average cost of 4.45%. Deposit costs continued to fall as spot deposit cost at the end of the quarter improved 21 basis points to 2.01%, an 84% beta versus the September rate cut. Capital remained strong and Common Equity Tier 1 Capital⁽³⁾ grew to 12.33%. Tangible common equity to tangible assets⁽²⁾ grew to 9.9%, with tangible book value per common share⁽²⁾ increasing 10.1% since year end even as we continued to repurchase stock at attractive levels. Credit quality showed improvement with classified assets as a percentage of capital falling to 7.0% and net charge-offs at 0.17%. Loan balances fell modestly as higher than anticipated payoffs impacted the quarter. As we look ahead to the end of the year, we expect our balance sheet optimization to be largely complete and for relative stability in loans and deposits as we continue to execute on our disciplined organic growth strategy.

Van A. Dukeman
Chairman and Chief Executive Officer

FINANCIAL RESULTS

Third quarter 2025 net income for First Busey Corporation, together with its consolidated subsidiaries (“Busey,” the “Company,” “we,” “us,”, or “our”) was $57.1 million, or $0.58 per diluted common share, compared to $47.4 million, or $0.52 per diluted common share, for the second quarter of 2025, and $32.0 million, or $0.55 per diluted common share, for the third quarter of 2024. Annualized return on average assets and annualized return on average tangible common equity⁽²⁾ were 1.21% and 11.96%, respectively, for the third quarter of 2025.

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1. Beginning in the second quarter of 2025, Busey revised its presentation, for all periods presented, to reclassify the provision for unfunded commitments so that it is now included within the provision for credit losses; therefore, it is no longer included within total noninterest expense.
   

Busey views certain non-operating items, including acquisition-related expenses, restructuring charges, and nonrecurring strategic events, as adjustments to net income reported under U.S. generally accepted accounting principles ("GAAP"). We also adjust for net securities gains and losses to align with industry and research analyst reporting. The objective of our presentation of adjusted earnings and adjusted earnings metrics is to allow investors and analysts to more clearly identify quarterly trends in core earnings performance. Pre-tax non-GAAP adjustments were as follows:

For more information and a reconciliation of non-GAAP measures—which are identified with the End Note labeled as (2)—in tabular form, see "Non-GAAP Financial Information."

Adjusted net income available to common stockholders,⁽²⁾ which excludes the impact of non-GAAP adjustments, was $57.4 million, or $0.64 per diluted common share, for the third quarter of 2025, compared to $57.2 million, or $0.63 per diluted common share, for the second quarter of 2025 and $32.9 million, or $0.57 per diluted common share, for the third quarter of 2024. Annualized adjusted return on average assets⁽²⁾ and annualized adjusted return on average tangible common equity⁽²⁾ were 1.33% and 13.20%, respectively, for the third quarter of 2025.

During the third quarter of 2025, dividends on preferred stock included the first dividend on Busey’s 8.25% Fixed-Rate Series B Non-Cumulative Perpetual Preferred Stock (“Series B Preferred Stock”). Based on the Certificate of Designation, dividends on the Series B Preferred Stock are calculated on the basis of a 360-day year of twelve 30-day months. This first dividend was calculated from the issuance date of May 20, 2025; therefore, it included additional days that resulted in additional dividends of $0.5 million in the third quarter, which is not expected to recur.

Pre-Provision Net Revenue⁽²⁾

Pre-provision net revenue⁽²⁾ was $76.6 million for the third quarter of 2025, compared to $64.2 million for the second quarter of 2025 and $42.2 million for the third quarter of 2024. Pre-provision net revenue to average assets⁽²⁾ was 1.63% for the third quarter of 2025, compared to 1.35% for the second quarter of 2025, and 1.40% for the third quarter of 2024.

Adjusted pre-provision net revenue⁽²⁾ was $83.9 million for the third quarter of 2025, compared to $80.8 million for the second quarter of 2025 and $44.1 million for the third quarter of 2024. Adjusted pre-provision net revenue to average assets⁽²⁾ was 1.78% for the third quarter of 2025, compared to 1.70% for the second quarter of 2025 and 1.46% for the third quarter of 2024.

Net Interest Income and Net Interest Margin⁽²⁾

Busey’s average balances, annualized yield rates, and net interest margins are presented in the tables below:

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1. On a tax-equivalent basis and assuming a federal income tax rate of 21.0%.
2. Non-accrual loans have been included in average portfolio loans.
3. Includes, as applicable, short-term borrowings, long-term borrowings, subordinated notes, and junior subordinated debt owed to unconsolidated trusts.
4. Annualized.
5. For a reconciliation of non-GAAP measures to the most directly comparable GAAP financial measures, see “Non-GAAP Financial Information.”
   

Components of the 9 basis point increase in net interest margin⁽²⁾ during the third quarter of 2025 were as follows:

• New and renewed loans continued to price at higher spreads, contributing +8 basis points
• Reduced funding costs on deposits, as we benefited from actions taken to reduce high-cost, non-relationship deposits, contributed +7 basis points
• Remaining benefit from the May 20, 2025, issuance of preferred stock and the June 1, 2025, subordinated debt redemption contributed +5 basis points
• Reduced rates and volume on cash and securities portfolio contributed -6 basis points
• Reduced purchase accounting accretion contributed -3 basis points
• Impact of fixed borrowing expenses contributed -2 basis points

Based on our most recent Asset Liability Management Committee model, a -100 basis point parallel rate shock is expected to decrease net interest income by 1.3% (relative to a current base rate scenario) over the subsequent twelve-month period. Busey continues to evaluate and execute off-balance sheet hedging and balance sheet strategies as well as embedding rate protection in our asset originations to provide stabilization to net interest income in lower rate environments. Stability in core deposit balances as well as retail time deposit and savings specials have continued to provide sufficient funding flows to allow intentional runoff of brokered and high-cost, non-relationship funding with no incremental short-term borrowing during the quarter. This strategic targeted reduction of $794.6 million deposits bearing a weighted average cost of 4.45% included $228.2 million of brokered deposits. At September 30, 2025, the Bank had $125.4 million, or 0.8% of total deposits, of remaining brokered funding. Total deposit cost of funds decreased, as expected, from 2.21% during the second quarter of 2025 to 2.15% during the third quarter of 2025. At September 30, 2025, our spot rate on total deposits costs was 2.01%, compared to 2.22% at June 30, 2025.

Noninterest Income

Total noninterest income decreased by 8.2% compared to the second quarter of 2025 primarily due to a decrease in gains on net securities, as Busey recorded a second quarter gain on its approximately 3% equity ownership of a financial institution that was the target of an announced acquisition at a significant market premium. Compared to the third quarter of 2024, total noninterest income increased by 14.9% as we benefit from the CrossFirst acquisition and extend services into new markets.

Busey continues to benefit from its diverse set of product offerings. Wealth management fees, wealth management referral fees included in other noninterest income, payment technology solutions, treasury management services, and corporate credit card interchange income contributed 67.9% of noninterest income excluding net securities gains and losses⁽²⁾ for the third quarter of 2025.

Noteworthy changes in noninterest income during the quarter include:

• Wealth management fees increased by 2.4% compared to the second quarter of 2025 primarily due to increases in trust and estate fees, partially offset by seasonally lower tax preparation fees. Busey’s Wealth Management division ended the third quarter of 2025 with $14.96 billion in assets under care, compared to $14.10 billion at the end of the second quarter of 2025 and $13.69 billion at the end of the third quarter of 2024. Our portfolio management team continues to focus on long-term returns and managing risk in the face of volatile markets and has outperformed its blended benchmark⁽⁴⁾ over the last three and five years.
• Other noninterest income increased by $2.7 million, or 82.7%, compared to the second quarter of 2025, primarily due to gains on private equity investments and increased swap origination fee income.
  

Operating Efficiency

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1. Beginning in the second quarter of 2025, Busey revised its presentation, for all periods presented, to reclassify the provision for unfunded commitments so that it is now included within the provision for credit losses; therefore, it is no longer included within other noninterest expense or total noninterest expense.
   

Total noninterest expense decreased by 6.1% compared to the second quarter of 2025 and increased by 58.9% compared to the third quarter of 2024. Compared to the prior year, growth in noninterest expense was primarily attributable to nonrecurring acquisition expenses related to the CrossFirst acquisition and increased expense associated with the combined organization and branch network. Annual pre-tax expense synergy estimates resulting from the CrossFirst acquisition remain on track at $25.0 million, and we expect 50% of the identified synergies to be realized in 2025 and 100% in 2026.

Adjusted noninterest expense,⁽²⁾ which excludes acquisition and restructuring expenses and amortization of intangible assets, was $108.3 million in the third quarter of 2025, a 1.6% increase compared to $106.6 million in the second quarter of 2025 and a 52.5% increase compared to $71.0 million in the third quarter of 2024.

Noteworthy changes in noninterest expense during the quarter include:

• Salaries, wages, and employee benefits expenses declined by $4.2 million compared to the second quarter of 2025, with acquisition and restructuring expenses declining by $5.9 million. Compared to the third quarter of 2024, salaries, wages, and employee benefits expenses increased by $29.6 million, of which $5.5 million was attributable to increases in acquisition and restructuring expenses. In connection with the CrossFirst acquisition in March 2025 and the addition of 16 banking centers, Busey’s workforce expanded, with a net addition of 412 full-time equivalent associates over the past year.
• Data processing expense declined by $4.3 million compared to the second quarter of 2025, of which $3.5 million was attributable to decreases in acquisition and restructuring expenses. Additionally, synergies were realized resulting from the bank merger late in the second quarter. When compared with the third quarter of 2024 data processing expense increased by $2.8 million, of which $0.3 million was attributable to increases in acquisition and restructuring expenses. Busey has continued to make investments in technology enhancements and has also experienced inflation-driven price increases.

Busey’s efficiency ratio⁽²⁾ was 58.5% for the third quarter of 2025, compared to 63.9% for the second quarter of 2025 and 61.8% for the third quarter of 2024. Our adjusted efficiency⁽²⁾ ratio was 54.8% for the third quarter of 2025, compared to 55.3% for the second quarter of 2025, and 60.2% for the third quarter of 2024. As our business grows, Busey remains focused on prudently managing our expense base and operating efficiently.

BALANCE SHEET STRENGTH

Busey’s financial strength is built on a long-term conservative operating approach. That focus has endured over time and will continue to guide us in the future.

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1. Net balance of preferred stock ($0.001 par value), common stock ($0.001 par value), additional paid-in capital, and treasury stock.

Investment Securities

Busey’s investment securities were comprised of the following:

Portfolio Loans

Busey’s loan portfolio was comprised of the following:

We remain steadfast in our conservative approach to underwriting and our disciplined approach to pricing. We experienced elevated payoffs during the quarter that outpaced new production momentum. We expect continued pressure, particularly from commercial real estate payoffs through the remainder of 2025.

Asset Quality

Asset quality continues to be strong. Busey Bank maintains a well-diversified loan portfolio and, as a matter of policy and practice, limits concentration exposure in any particular loan segment.

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1. Capital amounts for the third quarter of 2025 are not yet finalized and are subject to change.
   

Non-performing assets decreased by $0.4 million compared to June 30, 2025, and increased by $49.4 million compared to September 30, 2024, with the increase compared to the prior year due primarily to the loans purchased with credit deterioration (“PCD”) assumed in the CrossFirst acquisition. Non-performing assets represented 0.32% of total assets as of September 30, 2025, a 1 basis point increase from June 30, 2025, and a 25 basis point increase from September 30, 2024.

Classified assets decreased by $14.7 million compared to June 30, 2025, and increased by $72.1 million compared to September 30, 2024, with the increase compared to the prior year due primarily to the PCD loans assumed in the CrossFirst acquisition.

The allowance for credit losses was $174.2 million as of September 30, 2025, representing 1.28% of total portfolio loans outstanding, and providing coverage of 3.67 times our non-performing loans balance.

Busey’s net charge-offs and provision for credit losses were as follows:

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1. Amounts reported as provision for loan losses for periods ending prior to June 30, 2025, were previously reported as provision for credit losses. The nine months ended September 30, 2025, included $42.4 million to establish an initial allowance for loan losses for loans purchased without credit deterioration (“non-PCD” loans) following the close of the CrossFirst acquisition.
2. The three months ended June 30, 2025, included a $4.0 million adjustment to the initial provision for unfunded commitments resulting from the adoption of a new CECL model. Including the adjustment recorded in the second quarter, the nine months ended September 30, 2025, included a total of $7.2 million to establish an initial allowance for unfunded commitments following the close of the CrossFirst acquisition.
3. Beginning in the second quarter of 2025, Busey revised its presentation, for all periods presented, to reclassify the provision for unfunded commitments so that it is now included within the provision for credit losses.
   

Net charge-offs decreased by $7.0 million when compared to the second quarter of 2025, and increased by $5.6 million when compared with the third quarter of 2024. Net charge-offs during the nine months ended September 30, 2025, included $35.5 million related to PCD loans acquired from CrossFirst Bank, which were fully reserved at acquisition and did not require recording additional provision expense.

The $3.3 million provision reversal for loan losses recorded in the third quarter of 2025 included a provision release of $7.1 million for PCD loans due to payoffs/paydowns and a provision expense of $3.8 million for non-PCD loans to support charge-offs and qualitative factor adjustments.

Deposits

Busey’s deposits were comprised of the following:

In the third quarter of 2025, Busey executed a strategic targeted reduction of high-cost, non-relationship deposits, resulting in the intentional runoff of $794.6 million of deposits, including $228.2 million of brokered deposits, bearing a weighted average cost of 4.45%. Excluding this targeted runoff, deposits grew by $63.0 million during the third quarter of 2025.

Core deposits⁽²⁾ accounted for 93.8% of total deposits as of September 30, 2025. The quality of our core deposit franchise is a critical value driver of our institution. We estimated that 35% of