When did First Northern Community Bancorp file this 10-Q?

First Northern Community Bancorp (FNRN) filed this Quarterly Report (Form 10-Q) with the SEC on May 7, 2026. The accession number assigned by EDGAR is 0001437749-26-015475.

What does a 10-Q disclose?

Form 10-Q is the SEC's quarterly report. Public companies file it after each of the first three fiscal quarters to disclose unaudited financial statements and management's discussion of operations. The fourth-quarter results are rolled into the annual 10-K instead.

How is a 10-Q different from a 10-K?

Form 10-Q is filed three times a year (after Q1, Q2, and Q3 — the fourth quarter rolls into the 10-K). 10-Qs contain unaudited interim financial statements and a shorter MD&A. They're due 40 or 45 days after quarter end depending on filer size.

Where can I find First Northern Community Bancorp's prior quarterly reports on EDGAR?

The SEC EDGAR browser lists every 10-Q First Northern Community Bancorp has filed under CIK 1114927, sortable by date. Use the "View on SEC EDGAR" link in the page header, or browse directly via https://www.sec.gov/cgi-bin/browse-edgar.

First Northern Community Bancorp (FNRN) 10-Q filed May 7, 2026

fnrn20260331_10q.htm

Table of Contents

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark one)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Quarterly Period Ended March 31, 2026

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _______________ to _______________

Commission File Number 000-30707

First Northern Community Bancorp

(Exact name of registrant as specified in its charter)

California	68-0450397
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification Number)

195 N. First Street, Dixon, California	95620
(Address of principal executive offices)	(Zip Code)

707-678-3041

(Registrant’s telephone number including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading symbols(s)		Name of each exchange on which registered
Common stock, without par value		FNRN		The Nasdaq Stock Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or Section 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.

Yes ☒

No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Yes ☒

No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☐	Accelerated filer ☐
Non-accelerated filer ☒	Smaller reporting company ☒
	Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ☐

No ☒

The number of shares of Common Stock outstanding as of May 4, 2026 was 16,407,006.

Table of Contents

FIRST NORTHERN COMMUNITY BANCORP

INDEX

	Page
PART I – Financial Information	3

ITEM I. – Financial Statements (Unaudited)	3

Condensed Consolidated Balance Sheets (Unaudited)	3

Condensed Consolidated Statements of Income (Unaudited)	4

Condensed Consolidated Statements of Comprehensive Income (Unaudited)	5

Condensed Consolidated Statements of Stockholders’ Equity (Unaudited)	6

Condensed Consolidated Statements of Cash Flows (Unaudited)	7

Notes to Condensed Consolidated Financial Statements	8

ITEM 2. – MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	32

ITEM 3. – QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	48

ITEM 4. – CONTROLS AND PROCEDURES	48

PART II – OTHER INFORMATION	48

ITEM 1. – LEGAL PROCEEDINGS	48

ITEM 1A. – RISK FACTORS	48

ITEM 2. – UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	49

ITEM 3. – DEFAULTS UPON SENIOR SECURITIES	49

ITEM 4. – MINE SAFETY DISCLOSURES	49

ITEM 5. – OTHER INFORMATION	49

ITEM 6. – EXHIBITS	50

SIGNATURES	51

Table of Contents

PART I – FINANCIAL INFORMATION

FIRST NORTHERN COMMUNITY BANCORP

ITEM I. – FINANCIAL STATEMENTS (UNAUDITED)

CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)

(in thousands, except share amounts)	*March 31, 2026*			*December 31, 2025*

Assets

Cash and cash equivalents	$	139,584		$	145,554
Certificates of deposit		10,172			10,180
Investment securities – available-for-sale, at estimated fair value, net of allowance for credit losses of $0; amortized cost of $649,921 at March 31, 2026 and $639,532 at December 31, 2025		623,282			617,243
Loans, net of allowance for credit losses of $14,803 at March 31, 2026 and $14,519 at December 31, 2025		1,064,622			1,050,473
Stock in Federal Home Loan Bank and other equity securities, at cost		10,871			10,871
Premises and equipment, net		8,968			8,711
Other real estate owned		1,241			1,241
Intangible assets, net		4,079			4,332
Interest receivable and other assets		61,729			62,345

Total Assets	$	1,924,548		$	1,910,950

Liabilities and Stockholders’ Equity

Liabilities:
Deposits:
Demand deposits	$	627,854		$	632,128
Interest-bearing transaction deposits		444,163			438,901
Savings and MMDA's		482,722			466,453
Time, $250,000 or less		84,737			88,031
Time, over $250,000		55,222			53,630
Total deposits		1,694,698			1,679,143

Interest payable and other liabilities		16,051			19,789

Total Liabilities		1,710,749			1,698,932

Commitments and contingencies (Note 7)

Stockholders' Equity:
Common stock, no par value; 32,000,000 shares authorized; 16,409,660 shares issued and outstanding at March 31, 2026 and 16,406,281 shares issued and outstanding at December 31, 2025		134,069			134,566
Additional paid-in capital		977			977
Retained earnings		97,309			91,953
Accumulated other comprehensive loss, net		(18,556	)		(15,478	)
Total Stockholders’ Equity		213,799			212,018

Total Liabilities and Stockholders’ Equity	$	1,924,548		$	1,910,950

See notes to unaudited condensed consolidated financial statements.

Table of Contents

FIRST NORTHERN COMMUNITY BANCORP

CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

	*Three months ended*		*Three months ended*
(in thousands, except per share amounts)	*March 31, 2026*		*March 31, 2025*
Interest and dividend income:
Loans	$	14,322	$	13,602
Due from banks interest bearing accounts		1,204		888
Investment securities:
Taxable		4,434		4,348
Non-taxable		447		393
Other earning assets		555		272
Total interest and dividend income		20,962		19,503
Interest expense:
Deposits		3,758		3,560
Total interest expense		3,758		3,560
Net interest income		17,204		15,943
Provision for credit losses		300		850
Net interest income after provision for credit losses		16,904		15,093
Non-interest income:
Service charges on deposit accounts		416		422
Gains on sales of loans held-for-sale		18		14
Investment and brokerage services income		384		151
Loan servicing income		69		76
Debit card income		645		653
Losses on sales/calls of available-for-sale securities		—		(53	)
Other income		208		190
Total non-interest income		1,740		1,453
Non-interest expenses:
Salaries and employee benefits		6,559		6,374
Occupancy and equipment		1,036		1,139
Data processing		1,133		1,096
Stationery and supplies		69		83
Advertising		82		133
Directors’ fees		53		47
Amortization of intangible assets		253		189
Other expense		1,847		2,529
Total non-interest expenses		11,032		11,590
Income before provision for income taxes		7,612		4,956
Provision for income taxes		1,706		1,285

Net income	$	5,906	$	3,671

Basic earnings per common share	$	0.37	$	0.22
Diluted earnings per common share	$	0.36	$	0.22

See notes to unaudited condensed consolidated financial statements.

Table of Contents

FIRST NORTHERN COMMUNITY BANCORP

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED)

	*Three months ended*			*Three months ended*
(in thousands)	*March 31, 2026*			*March 31, 2025*
Net income	$	5,906		$	3,671
Other comprehensive (loss) income, net of tax:
Unrealized holding (losses) gains arising during the period, net of tax effect of $(1,272) and $3,713 for the three months ended March 31, 2026 and March 31, 2025, respectively		(3,078	)		8,849
Less: reclassification adjustment due to losses realized on sales of securities, net of tax effect of $0 and $16 for the three months ended March 31, 2026 and March 31, 2025, respectively		—			37
Other comprehensive (loss) income, net of tax	$	(3,078	)	$	8,886

Comprehensive income	$	2,828		$	12,557

See notes to unaudited condensed consolidated financial statements.

Table of Contents

FIRST NORTHERN COMMUNITY BANCORP

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (UNAUDITED)

												*Accumulated*
							*Additional*					*Other*
(in thousands, except share data)	*Common Stock*						*Paid-in*		*Retained*			*Comprehensive*
	*Shares*			*Amounts*			*Capital*		*Earnings*			*Loss, net of tax*			*Total*

Balance at December 31, 2024		15,943,051		$	127,902		$	977	$	81,304		$	(33,851	)	$	176,332
Net income										3,671						3,671
Other comprehensive income, net of taxes													8,886			8,886
Stock dividend adjustment		(616	)		352					(352	)					—
Cash in lieu of fractional shares		(129	)							(8	)					(8	)
Stock-based compensation					198											198
Common shares issued related to restricted stock grants		64,807			—											—
Stock options exercised, net of swapped shares		17,936			—											—
Stock repurchase and retirement		(127,120	)		(1,274	)										(1,274	)
Balance at March 31, 2025		15,897,929		$	127,178		$	977	$	84,615		$	(24,965	)	$	187,805

Balance at December 31, 2025		16,406,281		$	134,566		$	977	$	91,953		$	(15,478	)	$	212,018
Net income										5,906						5,906
Other comprehensive loss, net of taxes													(3,078	)		(3,078	)
Stock dividend adjustment		2,472			540					(540	)					—
Cash in lieu of fractional shares		(138	)							(10	)					(10	)
Stock-based compensation					115											115
Common shares issued related to restricted stock grants, net of forfeited shares		49,660			—											—
Stock options exercised, net of swapped shares		32,254			—											—
Stock repurchase and retirement		(80,869	)		(1,152	)										(1,152	)
Balance at March 31, 2026		16,409,660		$	134,069		$	977	$	97,309		$	(18,556	)	$	213,799

See notes to unaudited condensed consolidated financial statements.

Table of Contents

FIRST NORTHERN COMMUNITY BANCORP

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

	*Three months ended*			*Three months ended*
(in thousands)	*March 31, 2026*			*March 31, 2025*
Cash Flows From Operating Activities
Net income	$	5,906		$	3,671
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation		241			250
Accretion and amortization of investment securities premiums and discounts, net		(457	)		(336	)
Increase in deferred loan origination costs, net		(254	)		(226	)
Amortization of core deposit intangible		253			189
Provision for credit losses		300			850
Stock-based compensation		115			198
Losses on sales/calls of available-for-sale securities		—			53
Amortization of operating lease right-of-use asset		217			218
Gains on sales of loans held-for-sale		(18	)		(14	)
Proceeds from sales of loans held-for-sale		1,437			1,083
Originations of loans held-for-sale		(1,419	)		(1,484	)
Gain on purchase of tax credits		(191	)		—
Changes in assets and liabilities:
Increase in interest receivable and other assets		1,862			1,181
Decrease in interest payable and other liabilities		(3,738	)		(2,213	)
Net cash provided by operating activities		4,254			3,420

Cash Flows From Investing Activities
Proceeds from calls or maturities of available-for-sale securities		12,500			11,000
Proceeds from sales of available-for-sale securities		—			3,367
Principal repayments on available-for-sale securities		21,808			20,615
Purchases of available-for-sale securities		(44,240	)		(25,399	)
Proceeds from maturities of certificates of deposit		1,448			493
Purchases of certificates of deposit		(1,440	)		—
Net (increase) decrease in loans		(14,195	)		5,433
Purchases of premises and equipment		(498	)		(96	)
Net cash (used in) provided by investing activities		(24,617	)		15,413

Cash Flows From Financing Activities
Net increase (decrease) in deposits		15,555			(25,282	)
Cash dividends paid in lieu of fractional shares		(10	)		(8	)
Repurchases of common stock		(1,152	)		(1,274	)
Net cash provided by (used in) financing activities		14,393			(26,564	)

Net decrease in Cash and Cash Equivalents		(5,970	)		(7,731	)
Cash and Cash Equivalents, beginning of period		145,554			119,448
Cash and Cash Equivalents, end of period	$	139,584		$	111,717

Supplemental Disclosures of Cash Flow Information:
Cash paid during the period for:
Interest	$	3,822		$	4,163
Supplemental disclosures of non-cash investing and financing activities:
Stock dividend distributed		10,659			7,510
Unrealized holding (losses) gains on available-for-sale securities, net of taxes		(3,078	)		8,886
Market value of shares tendered in-lieu of cash to pay for exercise of options		257			184
Transfer of premises and equipment to other real estate owned		—			1,241

See notes to unaudited condensed consolidated financial statements.

Table of Contents

FIRST NORTHERN COMMUNITY BANCORP

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2026 and 2025 and December 31, 2025

1. BASIS OF PRESENTATION

The accompanying unaudited condensed consolidated financial statements of First Northern Community Bancorp (the “Company”) have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission. Accordingly, they do not include all of the information and notes required by GAAP for complete financial statements. In the opinion of management, all adjustments considered necessary for a fair presentation have been included. The results of operations for any interim period are not necessarily indicative of results expected for the full year. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025 as filed with the Securities and Exchange Commission ("SEC"). The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements as well as reported amounts of revenue and expense during the reporting period. Actual results could differ from those estimates. All material intercompany balances and transactions have been eliminated in consolidation.

2. ACCOUNTING POLICIES

The most significant accounting policies followed by the Company are presented in Note 1 to the audited consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025. These policies, along with the disclosures presented in the other financial statement notes and in this discussion, provide information on how significant assets and liabilities are valued in the financial statements and how those values are determined.

Recently Issued Accounting Pronouncements

In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses. This ASU requires public companies to disclose, in the notes to financial statements, specified information about certain costs and expenses at each interim and annual reporting period. In January 2025, the FASB issued ASU 2025-01, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the Effective Date. ASU 2025-01 amends the effective date of ASU 2024-03 to clarify that all public business entities are required to adopt the guidance in annual reporting periods beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027. Early adoption of ASU 2024-03 is permitted. The Company is evaluating the accounting and disclosure requirements of this update and the impact of adopting the new guidance on the consolidated financial statements.

In November 2025, the FASB issued ASU 2025-08, Financial Instruments - Credit Losses (Topic 326): Purchased Loans. This ASU expands the population of acquired financial assets accounted for using the gross-up approach. Acquired loans (excluding credit cards) are deemed purchased seasoned loans and accounted for using the gross-up approach upon acquisition if criteria established by the new guidance are met. This change aims to enhance comparability, consistency, and better reflect the economics of acquiring financial assets. This ASU is effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods within those annual reporting periods. Early adoption is permitted in an interim or annual reporting period in which financial statements have not yet been issued or made available for issuance. The Company is evaluating the accounting and disclosure requirements of this update and the impact of adopting the new guidance on the consolidated financial statements.

In November 2025, the FASB issued ASU 2025-09, Derivatives and Hedging (Topic 815): Hedge Accounting Improvements. This ASU enables entities to apply hedge accounting to a greater number of highly effective economic hedges in the following five areas: similar risk assessment for cash flow hedges, hedging forecasted interest payments on choose-your-rate debt instruments, cash flow hedges of nonfinancial forecasted transactions, net written options as hedging instruments, foreign-currency-denominated debt instrument as hedging instrument and hedged item (dual hedge). This ASU is effective for public business entities for annual reporting periods beginning after December 15, 2026, and interim periods within those annual reporting periods. Early adoption is permitted on any date on or after the issuance of ASU No. 2025-09. The Company is evaluating the accounting and disclosure requirements of this update and the impact of adopting the new guidance on the consolidated financial statements.

In December 2025, the FASB issued ASU 2025-11, Interim Reporting (Topic 270): Narrow-Scope Improvements. This ASU does not change the fundamental nature of interim reporting or expand or reduce current interim disclosure requirements. The amendments in this ASU: clarify that the guidance in Topic 270 applies to all entities that provide interim financial statements and notes in accordance with GAAP; create a comprehensive list in FASB Accounting Standards Codification Topic 270 of interim disclosures that are required in interim financial statements and notes in accordance with GAAP; incorporate a disclosure principle, which is modeled after previous SEC guidance, that requires entities to disclose events and changes that occur after the end of the most recent fiscal year that have a material impact on the entity; and improve guidance about information included in and the format of interim financial statements. The amendments in this ASU are effective for pubic business entities for interim periods within annual periods beginning after December 15, 2027. Early adoption is permitted for all entities. The amendments can be applied either prospectively or retrospectively to any or all prior periods presented in the financial statements. The Company is evaluating the disclosure requirements of this update and the impact of adopting the new guidance on the consolidated financial statements.

In December 2025, the FASB issued ASU 2025-12, Codification Improvements. The amendments in this ASU update the FASB ASC for a broad range of Topics arising from technical corrections, unintended application of the ASC, clarifications, and other minor improvements. The amendments in this ASU, which addresses 33 issues, affect a wide variety of Topics in the ASC and apply to all reporting entities within the scope of the affected accounting guidance. The amendments in this ASU are effective for all entities for annual periods beginning after December 15, 2026, and interim periods within those annual periods. Early adoption is permitted in both interim and annual periods in which financial statements have not yet been issued or made available for issuance. The Company is evaluating the accounting and disclosure requirements of this update and the impact of adopting the new guidance on the consolidated financial statements.

Table of Contents

3. INVESTMENT SECURITIES

The amortized cost, unrealized gains and losses, estimated fair values, and allowance for credit losses (ACL) of investments in debt and other securities at March 31, 2026 are summarized as follows:

	*Amortized*		*Unrealized*		*Unrealized*			*Estimated*
(in thousands)	*cost*		*gains*		*losses*			*fair value*		*ACL*
Investment securities available-for-sale:
U.S. Treasury securities	$	90,689	$	186	$	(563	)	$	90,312	$	—
Securities of U.S. government agencies and corporations		85,803		292		(2,081	)		84,014		—
Obligations of states and political subdivisions		77,766		181		(3,859	)		74,088		—
Collateralized mortgage obligations		106,603		80		(12,378	)		94,305		—
Mortgage-backed securities		289,060		795		(9,292	)		280,563		—

Total debt securities	$	649,921	$	1,534	$	(28,173	)	$	623,282	$	—

The amortized cost, unrealized gains and losses and estimated fair values of investments in debt and other securities at December 31, 2025 are summarized as follows:

	*Amortized*		*Unrealized*		*Unrealized*			*Estimated*
(in thousands)	*cost*		*gains*		*losses*			*fair value*		*ACL*
Investment securities available-for-sale:
U.S. Treasury securities	$	87,578	$	420	$	(442	)	$	87,556	$	—
Securities of U.S. government agencies and corporations		86,831		462		(1,949	)		85,344		—
Obligations of states and political subdivisions		77,796		448		(3,241	)		75,003		—
Collateralized mortgage obligations		103,364		155		(11,235	)		92,284		—
Mortgage-backed securities		283,963		1,640		(8,547	)		277,056		—

Total debt securities	$	639,532	$	3,125	$	(25,414	)	$	617,243	$	—

The Company generated $0 and $3,367,000 in proceeds from sales of available-for-sale securities for the three-month periods ended March 31, 2026 and 2025, respectively. There were no gross realized gains on sales or calls of available-for-sale securities for the three-month periods ended March 31, 2026 and 2025, respectively. Gross realized losses on sales or calls of available-for-sale securities were $0 and $53,000 for the three-month periods ended March 31, 2026 and 2025, respectively.

The amortized cost and estimated fair value of debt and other securities at March 31, 2026, by contractual maturity, are shown in the following table:

	*Amortized*		*Estimated*
(in thousands)	*cost*		*fair value*

Maturity in years:
Due in one year or less	$	54,245	$	53,954
Due after one year through five years		120,597		118,692
Due after five years through ten years		38,253		36,721
Due after ten years		41,163		39,047
Subtotal		254,258		248,414
Mortgage-backed securities & collateralized mortgage obligations		395,663		374,868
Total	$	649,921	$	623,282

Expected maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. In addition, factors such as prepayments and interest rates may affect the yield on the carrying value of mortgage-related securities.

Table of Contents

An analysis of gross unrealized losses of the available-for-sale investment securities portfolio as of March 31, 2026, follows:

(in thousands)	*Less than 12 months*					*12 months or more*					*Total*
			*Unrealized*					*Unrealized*					*Unrealized*
	*Fair Value*		*losses*			*Fair Value*		*losses*			*Fair Value*		*losses*

U.S. Treasury securities		29,025	$	(135	)	$	23,391	$	(428	)	$	52,416	$	(563	)
Securities of U.S. government agencies and corporations		20,667		(228	)		41,840		(1,853	)		62,507		(2,081	)
Obligations of states and political subdivisions		23,030		(382	)		37,765		(3,477	)		60,795		(3,859	)
Collateralized mortgage obligations		22,939		(245	)		55,122		(12,133	)		78,061		(12,378	)
Mortgage-backed securities		81,441		(781	)		115,490		(8,511	)		196,931		(9,292	)
Total	$	177,102	$	(1,771	)	$	273,608	$	(26,402	)	$	450,710	$	(28,173	)

One hundred and twenty-two securities, all considered investment grade, which had an aggregate fair value of $177,102,000 and a total unrealized loss of $1,771,000, have been in an unrealized loss position for less than twelve months as of March 31, 2026. Three hundred and twenty-six securities, all considered investment grade, which had an aggregate fair value of $273,608,000 and a total unrealized loss of $26,402,000, have been in an unrealized loss position for more than twelve months as of March 31, 2026. The unrealized losses on the Company's investment securities were caused by market conditions for these types of investments, particularly changes in risk-free interest rates. The decline in fair value is attributable to changes in interest rates and not credit quality, and the Company does not intend to sell the securities. The Company has concluded it is not more likely than not that the Company will be required to sell these securities prior to recovery of their anticipated cost basis. Therefore, as of March 31, 2026, the Company had not recorded an allowance for credit losses on these securities and the unrecognized or unrealized losses on these securities have not been recognized into income.

The fair value of investment securities could decline in the future if the general economy deteriorates, inflation and interest rates increase, credit ratings decline, the issuer's financial condition deteriorates, or the liquidity for securities declines. As a result, an allowance for credit loss may occur in the future.

An analysis of gross unrealized losses of the available-for-sale investment securities portfolio as of December 31, 2025, follows:

(in thousands)	*Less than 12 months*					*12 months or more*					*Total*
			*Unrealized*					*Unrealized*					*Unrealized*
	*Fair Value*		*losses*			*Fair Value*		*losses*			*Fair Value*		*losses*

U.S. Treasury Securities	$	7,664	$	(7	)	$	25,834	$	(435	)	$	33,498	$	(442	)
Securities of U.S. government agencies and corporations		14,168		(46	)		41,820		(1,903	)		55,988		(1,949	)
Obligations of states and political subdivisions		1,144		(1	)		47,845		(3,240	)		48,989		(3,241	)
Collateralized Mortgage obligations		13,402		(51	)		58,408		(11,184	)		71,810		(11,235	)
Mortgage-backed securities		21,385		(33	)		127,245		(8,514	)		148,630		(8,547	)
Total	$	57,763	$	(138	)	$	301,152	$	(25,276	)	$	358,915	$	(25,414	)

Investment securities carried at $92,313,000 and $95,479,000 at March 31, 2026 and December 31, 2025, respectively, were pledged to secure public deposits or for other purposes as required or permitted by law.

Table of Contents

4. LOANS AND ALLOWANCE FOR CREDIT LOSSES

The composition of the Company’s loan portfolio, by loan class, as of March 31, 2026 and December 31, 2025 was as follows:

(in thousands)	*March 31, 2026*			*December 31, 2025*

Commercial	$	178,015		$	146,178
Commercial Real Estate		697,845			702,455
Agriculture		86,434			93,627
Residential Mortgage		96,754			100,684
Residential Construction		5,569			5,837
Consumer		13,821			15,478

		1,078,438			1,064,259
Allowance for credit losses		(14,803	)		(14,519	)
Deferred origination fees and costs, net		987			733

Loans, net	$	1,064,622		$	1,050,473

At March 31, 2026 and December 31, 2025, all loans were pledged under a blanket collateral lien to secure actual or potential borrowings from the Federal Home Loan Bank (“FHLB”).

Allowance for Credit Losses

The following tables summarize the activity in the allowance for credit losses on loans which is recorded as a contra asset, and the reserve for unfunded commitments which is recorded on the condensed consolidated balance sheet within other liabilities, as of and for the three months ended March 31, 2026 and March 31, 2025.

	*Allowance for Credit Losses – Three months ended March 31, 2026*
	*Beginning*							*Provision*			*Ending*
(in thousands)	*Balance*		*Charge-offs*			*Recoveries*		*(Recovery)*			*Balance*
Commercial	$	2,425	$	(139	)	$	3	$	319		$	2,608
Commercial Real Estate		9,343		—			—		(158	)		9,185
Agriculture		1,074		—			20		55			1,149
Residential Mortgage		1,005		—			—		207			1,212
Residential Construction		376		—			—		(12	)		364
Consumer		296		(1	)		1		(11	)		285
Allowance for credit losses on loans		14,519		(140	)		24		400			14,803
Reserve for unfunded commitments		1,200		—			—		(100	)		1,100
Total	$	15,719	$	(140	)	$	24	$	300		$	15,903

Table of Contents

	*Allowance for Credit Losses – Three months ended March 31, 2025*
	*Beginning*							*Provision*			*Ending*
(in thousands)	*Balance*		*Charge-offs*			*Recoveries*		*(Recovery)*			*Balance*
Commercial	$	1,622	$	(10	)	$	65	$	387		$	2,064
Commercial Real Estate		10,245		—			—		(1,374	)		8,871
Agriculture		1,555		—			—		2,377			3,932
Residential Mortgage		1,779		—			—		(799	)		980
Residential Construction		433		—			—		(26	)		407
Consumer		251		(6	)		1		35			281
Allowance for credit losses on loans		15,885		(16	)		66		600			16,535
Reserve for unfunded commitments		700		—			—		250			950
Total	$	16,585	$	(16	)	$	66	$	850		$	17,485

The Company utilizes three economic variables, forecasted unemployment, gross domestic product and single-family home prices, as loss drivers for its allowance for credit losses. During the quarter ended March 31, 2026, the levels of forecasted gross domestic product and single-family home prices improved. The Company recorded provision expense totaling $300,000 for the three months ended March 31, 2026, primarily due to an increase in qualitative factors to incorporate additional risk related to geopolitical matters. Management believes the allowance for credit losses at March 31, 2026 appropriately reflected expected credit losses in the loan portfolio at that date.

Table of Contents

Collateral Dependent Loans

In accordance with ASC 326, a loan is considered collateral dependent when the borrower is experiencing financial difficulty and repayment is expected to be provided substantially through the operation or sale of the collateral. All loans individually analyzed were collateral dependent loans as of March 31, 2026 and December 31, 2025. The following table presents the amortized cost basis of collateral dependent loans by class, which are individually evaluated to determine expected credit losses, as of March 31, 2026 and December 31, 2025:

March 31, 2026

(in thousands)	*Secured by 1-4 Family Residential Properties-1st lien*		*Secured by 1-4 Family Residential Properties-junior lien*		*Secured by 1-4 Family Residential Properties-revolving*		*Commercial*		*Construction and Land Development*
Commercial	$	—	$	—	$	—	$	139	$	—
Commercial Real Estate		—		—		—		—		—
Agriculture		—		—		—		—		—
Residential Mortgage		162		—		—		—		—
Residential Construction		—		—		—		—		—
Consumer		—		213		283		—		—
Total	$	162	$	213	$	283	$	139	$	—

					*Secured by*		*Secured by*
					*Owner-occupied,*		*Other*
					*Nonfarm*		*Nonfarm*
	*Secured by*		*Agriculture*		*Nonresidential*		*Nonresidential*
(in thousands)	*Farmland*		*Production*		*Properties*		*Properties*		*Total*
Commercial	$	—	$	—	$	—	$	—	$	139
Commercial Real Estate		—		—		909		—		909
Agriculture		538		2,674		—		—		3,212
Residential Mortgage		—		—		—		—		162
Residential Construction		—		—		—		—		—
Consumer		—		—		—		—		496
Total	$	538	$	2,674	$	909	$	—	$	4,918

December 31, 2025

(in thousands)	*Secured by 1-4 Family Residential Properties-1st lien*		*Secured by 1-4 Family Residential Properties-junior lien*		*Secured by 1-4 Family Residential Properties-revolving*		*Commercial*		*Construction and Land Development*
Commercial	$	—	$	—	$	—	$	139	$	—
Commercial Real Estate		—		—		—		—		—
Agriculture		—		—		—		—		—
Residential Mortgage		174		—		—		—		—
Residential Construction		—		—		—		—		—
Consumer		—		255		382		—		—
Total	$	174	$	255	$	382	$	139	$	—

					*Secured by*		*Secured by*
					*Owner-occupied,*		*Other*
					*Nonfarm*		*Nonfarm*
	*Secured by*		*Agriculture*		*Nonresidential*		*Nonresidential*
(in thousands)	*Farmland*		*Production*		*Properties*		*Properties*		*Total*
Commercial	$	—	$	—	$	—	$	—	$	139
Commercial Real Estate		—		—		—		657		657
Agriculture		662		3,761		—		—		4,423
Residential Mortgage		—		—		—		—		174
Residential Construction		—		—		—		—		—
Consumer		—		—		—		—		637
Total	$	662	$	3,761	$	—	$	657	$	6,030

Foreclosure Proceedings

The Company had no residential real estate property in the process of foreclosure at March 31, 2026 and December 31, 2025.

Table of Contents

Non-accrual and Past Due Loans

The Company’s loans by delinquency and non-accrual status, as of March 31, 2026 and December 31, 2025, was as follows:

					*90 days*				*Total*
	*30-59 days*		*60-89 days*		*or More*				*Past Due &*		*Current &*				*Nonaccrual*
	*Past Due &*		*Past Due &*		*Past Due &*		*Nonaccrual*		*Nonaccrual*		*Accruing*		*Total*		*Loans with*
(in thousands)	*Accruing*		*Accruing*		*Accruing*		*Loans*		*Loans*		*Loans*		*Loans*		*No ACL*
March 31, 2026
Commercial	$	328	$	397	$	—	$	139	$	864	$	177,151	$	178,015	$	139
Commercial Real Estate		715		—		—		909		1,624		696,221		697,845		909
Agriculture		—		—		—		3,212		3,212		83,222		86,434		3,212
Residential Mortgage		457		—		—		162		619		96,135		96,754		162
Residential Construction		—		—		—		—		—		5,569		5,569		—
Consumer		—		—		—		496		496		13,325		13,821		496
Total	$	1,500	$	397	$	—	$	4,918	$	6,815	$	1,071,623	$	1,078,438	$	4,918

December 31, 2025
Commercial	$	470	$	597	$	—	$	139	$	1,206	$	144,972	$	146,178	$	139
Commercial Real Estate		231		—		—		657		888		701,567		702,455		657
Agriculture		—		1		—		4,423		4,424		89,203		93,627		4,423
Residential Mortgage		691		—		—		174		865		99,819		100,684		174
Residential Construction		—		—		—		—		—		5,837		5,837		—
Consumer		—		—		—		637		637		14,841		15,478		637
Total	$	1,392	$	598	$	—	$	6,030	$	8,020	$	1,056,239	$	1,064,259	$	6,030

The Company recognized $2,000 and $0 of interest income on nonaccrual loans during the three months ended March 31, 2026 and March 31, 2025, respectively.

Loan Modifications

Occasionally, the Company modifies loans to borrowers in financial difficulty by providing principal forgiveness, term extension, payment delays or interest rate reduction. When principal forgiveness is provided, the amount of forgiveness is charged-off against the ACL.

In some cases, the Company provides multiple types of concessions on one loan. Typically, one type of concession, such as a term extension, is granted initially. If the borrower continues to experience financial difficulty, another concession, such as principal forgiveness, may be granted. For the loans included in the “combination” columns below, multiple types of modifications have been made on the same loan within the current reporting period. The combination is at least two of the following: a term extension, principal forgiveness, an other-than-insignificant payment delay and/or an interest rate reduction.

Table of Contents

The following tables present the amortized cost basis of loans that were experiencing both financial difficulty and modification during the periods indicated, by class and by type of modification. The percentage of the amortized cost basis of loans that were modified to borrowers in financial difficulty as compared to the amortized cost basis of each class of financing receivable is also presented below.

The amortized cost basis of loans that were experiencing both financial difficulty and modification during the three months ended March 31, 2026 were as follows:

(in thousands, except percentages)	*Term Extension*		*Payment Delay*		*Total Class of Financing Receivable*

Commercial	$	855	$	—		0.48	%
Commercial Real Estate		—		888		0.13	%
Agriculture		1,141		—		1.32	%
Residential Mortgage		—		—		—
Residential Construction		—		—		—
Consumer		—		—		—
Total	$	1,996	$	888		0.27	%

The amortized cost basis of loans that were experiencing both financial difficulty and modification during the three months ended March 31, 2025 were as follows:

			*Combination*
			*Term Extension and*		*Total Class of*
(in thousands, except percentages)	*Term Extension*		*Payment Delay*		*Financing Receivable*

Commercial	$	73	$	91		0.12	%
Commercial Real Estate		—		—		—
Agriculture		—		—		—
Residential Mortgage		—		—		—
Residential Construction		—		—		—
Consumer		—		—		—
Total	$	73	$	91		0.02	%

The Company had no commitments to lend additional funds to borrowers whose loans were modified at March 31, 2026 and March 31, 2025.

Table of Contents

The following table presents the financial effect of the loan modifications to borrowers experiencing financial difficulty during the three-month period ended March 31, 2026:

	*Weighted-Average*		*Weighted-Average*
	*Interest Rate*		*Term Extension*
	*Reduction*		*(in months)*
Commercial		—		5
Commercial Real Estate		—		—
Agriculture		—		6
Residential Mortgage		—		—
Residential Construction		—		—
Consumer		—		—
Total		—		6

The following table presents the financial effect of the loan modifications to borrowers experiencing financial difficulty during the three-month period ended March 31, 2025:

	*Weighted-Average*		*Weighted-Average*
	*Interest Rate*		*Term Extension*
	*Reduction*		*(in months)*
Commercial		—		40
Commercial Real Estate		—		—
Agriculture		—		—
Residential Mortgage		—		—
Residential Construction		—		—
Consumer		—		—
Total		—		40

Loans that were modified within the previous twelve months were current on payments as of March 31, 2026 and March 31, 2025. There were no loans modified within the previous twelve months and for which there was a payment default during the three month periods ended March 31, 2026 and March 31, 2025.

Upon the Company's determination that a modified loan (or portion of a loan) has subsequently become uncollectible, the loan (or a portion of the loan) is written off. Therefore, the amortized cost basis of the loan is reduced by the uncollectible amount and the ACL is adjusted by the same amount.

Table of Contents

Credit Quality Indicators

All loans are rated using the credit risk ratings and criteria adopted by the Company. Risk ratings are adjusted as future circumstances warrant. All credits risk rated 1, 2, 3, 4 or 5 equate to a Pass as indicated by Federal and State bank regulatory agencies; a 6 equates to a Special Mention; a 7 equates to Substandard; an 8 equates to Doubtful; and a 9 equates to a Loss. For the definitions of each risk rating, see Note 3 to our consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2025.

The following tables present the loan portfolio by loan class, origination year, and internal risk rating as of March 31, 2026. Generally, existing term loans that were re-underwritten are reflected in the table in the year of renewal. Lines of credit that have a conversion feature at the time of origination, such as construction to permanent loans, are presented by year of origination. Revolving loans converted to term loans totaled $5,954,000 and $1,780,000 as of March 31, 2026 and December 31, 2025, respectively.


	*Term Loans Amortized Cost Basis by Origination Year - As of March 31, 2026*
														*Revolving*
														*Loans*
														*Amortized*
(in thousands)		*2026*		*2025*		*2024*			*2023*		*2022*		*Prior*		*Cost Basis*			*Total*
Commercial
Pass	$	43,663	$	45,697	$	36,081		$	9,376	$	8,216	$	9,541	$	20,993		$	173,567
Special Mention		400		40		—			—		—		—		1,670			2,110
Substandard		—		115		109			—		—		604		1,510			2,338
Doubtful/Loss		—		—		—			—		—		—		—			—
Total Commercial loans	$	44,063	$	45,852	$	36,190		$	9,376	$	8,216	$	10,145	$	24,173		$	178,015
Year-to-date Charge-offs		—		—		(70	)		—		—		—		(69	)		(139	)
Year-to-date Recoveries		—		—		2			1		—		—		—			3
Year-to-date Net Charge-offs		—		—		(68	)		1		—		—		(69	)		(136	)

Commercial Real Estate
Pass	$	3,188	$	50,263	$	60,911		$	106,218	$	150,861	$	294,707	$	355		$	666,503
Special Mention		—		—		2,840			—		12,281		5,303		—			20,424
Substandard		—		—		—			643		3,398		6,877		—			10,918
Doubtful/Loss		—		—		—			—		—		—		—			—
Total Commercial Real Estate loans	$	3,188	$	50,263	$	63,751		$	106,861	$	166,540	$	306,887	$	355		$	697,845
Year-to-date Charge-offs		—		—		—			—		—		—		—			—
Year-to-date Recoveries		—		—		—			—		—		—		—			—
Year-to-date Net Charge-offs		—		—		—			—		—		—		—			—

Agriculture
Pass	$	5,877	$	7,845	$	2,846		$	6,102	$	15,406	$	27,182	$	12,085		$	77,343
Special Mention		—		—		—			—		—		—		—			—
Substandard		—		—		—			—		2,617		4,616		1,858			9,091
Doubtful/Loss		—		—		—			—		—		—		—			—
Total Agriculture loans	$	5,877	$	7,845	$	2,846		$	6,102	$	18,023	$	31,798	$	13,943		$	86,434
Year-to-date Charge-offs		—		—		—			—		—		—		—			—
Year-to-date Recoveries		—		—		—			—		20		—		—			20
Year-to-date Net Charge-offs		—		—		—			—		20		—		—			20

Table of Contents


	*Term Loans Amortized Cost Basis by Origination Year - As of March 31, 2026*
															*Revolving*
															*Loans*
															*Amortized*
(in thousands)		*2026*		*2025*			*2024*			*2023*		*2022*		*Prior*		*Cost Basis*			*Total*
Residential Mortgage
Pass	$	—	$	3,435		$	4,383		$	16,141	$	22,047	$	50,316	$	—		$	96,322
Special Mention		—		—			—			—		—		—		—			—
Substandard		—		—			—			—		267		165		—			432
Doubtful/Loss		—		—			—			—		—		—		—			—
Total Residential Mortgage loans	$	—	$	3,435		$	4,383		$	16,141	$	22,314	$	50,481	$	—		$	96,754
Year-to-date Charge-offs		—		—			—			—		—		—		—			—
Year-to-date Recoveries		—		—			—			—		—		—		—			—
Year-to-date Net Charge-offs		—		—			—			—		—		—		—			—

Residential Construction
Pass	$	1,310	$	1,769		$	—		$	1,089	$	484	$	917	$	—		$	5,569
Special Mention		—		—			—			—		—		—		—			—
Substandard		—		—			—			—		—		—		—			—
Doubtful/Loss		—		—			—			—		—		—		—			—
Total Residential Construction loans	$	1,310	$	1,769		$	—		$	1,089	$	484	$	917	$	—		$	5,569
Year-to-date Charge-offs		—		—			—			—		—		—		—			—
Year-to-date Recoveries		—		—			—			—		—		—		—			—
Year-to-date Net Charge-offs		—		—			—			—		—		—		—			—

Consumer
Pass	$	—	$	218		$	53		$	56	$	1,054	$	460	$	11,394		$	13,235
Special Mention		—		—			—			—		—		—		—			—
Substandard		—		—			—			—		—		—		586			586
Doubtful/Loss		—		—			—			—		—		—		—			—
Total Consumer loans	$	—	$	218		$	53		$	56	$	1,054	$	460	$	11,980		$	13,821
Year-to-date Charge-offs		—		(1	)		—			—		—		—		—			(1	)
Year-to-date Recoveries		—		—			—			—		—		1		—			1
Year-to-date Net Charge-offs		—		(1	)		—			—		—		1		—			—

Total Loans
Pass	$	54,038	$	109,227		$	104,274		$	138,982	$	198,068	$	383,123	$	44,827		$	1,032,539
Special Mention		400		40			2,840			—		12,281		5,303		1,670			22,534
Substandard		—		115			109			643		6,282		12,262		3,954			23,365
Doubtful/Loss		—		—			—			—		—		—		—			—
Total Loans	$	54,438	$	109,382		$	107,223		$	139,625	$	216,631	$	400,688	$	50,451		$	1,078,438
Year-to-date Charge-offs	$	—	$	(1	)	$	(70	)	$	—	$	—	$	—	$	(69	)	$	(140	)
Year-to-date Recoveries	$	—	$	—		$	2		$	1	$	20	$	1	$	—		$	24
Year-to-date Net Charge-offs	$	—	$	(1	)	$	(68	)	$	1	$	20	$	1	$	(69	)	$	(116	)

Table of Contents


	*Term Loans Amortized Cost Basis by Origination Year - As of December 31, 2025*
																	*Revolving*
																	*Loans*
																	*Amortized*
(in thousands)		*2025*		*2024*			*2023*			*2022*			*2021*			*Prior*		*Cost Basis*			*Total*
Commercial
Pass	$	53,724	$	37,264		$	9,628		$	9,008		$	4,473		$	4,964	$	24,740		$	143,801
Special Mention		73		—			—			—			—			—		324			397
Substandard		45		83			1			44			—			635		1,172			1,980
Doubtful/Loss													—			—		—			—
Total Commercial loans	$	53,842	$	37,347		$	9,629		$	9,052		$	4,473		$	5,599	$	26,236		$	146,178
Year-to-date Charge-offs		—		(119	)		(83	)		—			(13	)		—		(433	)		(648	)
Year-to-date Recoveries		—		1			256			—			—			16		—			273
Year-to-date Net Charge-offs		—		(118	)		173			—			(13	)		16		(433	)		(375	)

Commercial Real Estate
Pass	$	48,023	$	60,279		$	109,879		$	152,463		$	158,456		$	141,544	$	373		$	671,017
Special Mention		1,084		2,854			—			12,487			2,013			2,786		—			21,224
Substandard		372		—			657			3,415			—			5,770		—			10,214
Doubtful/Loss		—		—			—			—			—			—		—			—
Total Commercial Real Estate loans	$	49,479	$	63,133		$	110,536		$	168,365		$	160,469		$	150,100	$	373		$	702,455
Year-to-date Charge-offs		—		—			(26	)		—			—			—		—			(26	)
Year-to-date Recoveries		—		—			—			—			—			—		—			—
Year-to-date Net Charge-offs		—		—			(26	)		—			—			—		—			(26	)

Agriculture
Pass	$	11,029	$	2,970		$	3,426		$	15,496		$	17,593		$	13,004	$	19,121		$	82,639
Special Mention		—		—			—			—			—			—		—			—
Substandard		—		—			58			2,717			4,739			—		3,474			10,988
Doubtful/Loss		—		—			—			—			—			—		—			—
Total Agriculture loans	$	11,029	$	2,970		$	3,484		$	18,213		$	22,332		$	13,004	$	22,595		$	93,627
Year-to-date Charge-offs		—		—			—			(176	)		—			—		(298	)		(474	)
Year-to-date Recoveries		—		—			—			—			—			—		—			—
Year-to-date Net Charge-offs		—		—			—			(176	)		—			—		(298	)		(474	)

Table of Contents


	*Term Loans Amortized Cost Basis by Origination Year - As of December 31, 2025*
																		*Revolving*
																		*Loans*
																		*Amortized*
(in thousands)		*2025*			*2024*			*2023*			*2022*			*2021*			*Prior*		*Cost Basis*			*Total*
Residential Mortgage
Pass	$	3,451		$	4,755		$	17,156		$	22,718		$	24,516		$	27,642	$	—		$	100,238
Special Mention		—			—			—			—			—			—		—			—
Substandard		—			—			—			270			32			144		—			446
Doubtful/Loss		—			—			—			—			—			—		—			—
Total Residential Mortgage loans	$	3,451		$	4,755		$	17,156		$	22,988		$	24,548		$	27,786	$	—		$	100,684
Year-to-date Charge-offs		(5	)		—			—			—			—			—		—			(5	)
Year-to-date Recoveries		—			—			—			—			—			—		—			—
Year-to-date Net Charge-offs		(5	)		—			—			—			—			—		—			(5	)

Residential Construction
Pass	$	1,665		$	1,451		$	1,176		$	487		$	1,058		$	—	$	—		$	5,837
Special Mention		—			—			—			—			—			—		—			—
Substandard		—			—			—			—			—			—		—			—
Doubtful/Loss		—			—			—			—			—			—		—			—
Total Residential Construction loans	$	1,665		$	1,451		$	1,176		$	487		$	1,058		$	—	$	—		$	5,837
Year-to-date Charge-offs		—			—			—			—			—			—		—			—
Year-to-date Recoveries		—			—			—			—			—			—		—			—
Year-to-date Net Charge-offs		—			—			—			—			—			—		—			—

Consumer
Pass	$	233		$	59		$	69		$	1,063		$	94		$	376	$	12,923		$	14,817
Special Mention		—			—			—			—			—			—		—			—
Substandard		—			—			—			—			—			—		661			661
Doubtful/Loss		—			—			—			—			—			—		—			—
Total Consumer loans	$	233		$	59		$	69		$	1,063		$	94		$	376	$	13,584		$	15,478
Year-to-date Charge-offs		(16	)		(3	)		—			—			—			—		—			(19	)
Year-to-date Recoveries		8			—			—			—			—			—		25			33
Year-to-date Net Charge-offs		(8	)		(3	)		—			—			—			—		25			14

Total Loans
Pass	$	118,125		$	106,778		$	141,334		$	201,235		$	206,190		$	187,530	$	57,157		$	1,018,349
Special Mention		1,157			2,854			—			12,487			2,013			2,786		324			21,621
Substandard		417			83			716			6,446			4,771			6,549		5,307			24,289
Doubtful/Loss		—			—			—			—			—			—		—			—
Total Loans	$	119,699		$	109,715		$	142,050		$	220,168		$	212,974		$	196,865	$	62,788		$	1,064,259
Year-to-date Charge-offs	$	(21	)	$	(122	)	$	(109	)	$	(176	)	$	(13	)	$	—	$	(731	)	$	(1,172	)
Year-to-date Recoveries	$	8		$	1		$	256		$	—		$	—		$	16	$	25		$	306
Year-to-date Net Charge-offs	$	(13	)	$	(121	)	$	147		$	(176	)	$	(13	)	$	16	$	(706	)	$	(866	)

Table of Contents

5. MORTGAGE OPERATIONS

Transfers and servicing of financial assets and extinguishments of liabilities are accounted for and reported based on consistent application of a financial-components approach that focuses on control. Transfers of financial assets that are sales are distinguished from transfers that are secured borrowings. Retained servicing rights on loans sold are measured by allocating the previous carrying amount of the transferred assets between the loans sold and retained interest, if any, based on their relative fair value at the date of transfer. Fair values are estimated using discounted cash flows based on a current market interest rate.

The Company recognizes a gain and a related asset for the fair value of the rights to service loans for others when loans are sold. The Company sold a substantial portion of its portfolio of conforming long-term residential mortgage loans originated during the three months ended March 31, 2026 for cash proceeds equal to the fair value of the loans. The Company serviced real estate mortgage loans for others totaling $158,935,000 and $162,644,000 at March 31, 2026 and December 31, 2025, respectively.

The recorded value of mortgage servicing rights is amortized in proportion to, and over the period of, estimated net servicing revenues. The Company assesses capitalized mortgage servicing rights for impairment based upon the fair value of those rights at each reporting date. For purposes of measuring impairment, the rights are stratified based upon the product type, term and interest rates. Fair value is determined by discounting estimated net future cash flows from mortgage servicing activities using discount rates that approximate current market rates and estimated prepayment rates, among other assumptions. The amount of impairment recognized, if any, is the amount by which the capitalized mortgage servicing rights for a stratum exceeds their fair value. Impairment, if any, is recognized through a valuation allowance for each individual stratum. Changes in the carrying amount of mortgage servicing rights are reported in earnings under loan servicing income on the condensed consolidated statements of income.

Key assumptions used in measuring the fair value of mortgage servicing rights as of March 31, 2026 and December 31, 2025 were as follows:

	*March 31, 2026*			*December 31, 2025*

Constant prepayment rate		7.56	%		7.53	%
Discount rate		9.50	%		9.50	%
Weighted average life (years)		7.10			7.24

The following table summarizes the changes to the Company’s mortgage servicing rights assets as of the periods presented. Mortgage servicing rights are included in Interest Receivable and Other Assets on the condensed consolidated balance sheets.

(in thousands)	*December 31, 2025*		*Additions*		*Reductions*			*March 31, 2026*

Mortgage servicing rights	$	1,159	$	12	$	(45	)	$	1,126
Valuation allowance		—		—		—			—
Mortgage servicing rights, net of valuation allowance	$	1,159	$	12	$	(45	)	$	1,126

At March 31, 2026 and December 31, 2025, the estimated fair market value of the Company’s mortgage servicing rights assets was $1,743,000 and $1,748,000, respectively. The fair value of mortgage servicing rights during 2026 remained relatively stable, reflecting minimal movement in key assumptions and minimal additions during the three months ended March 31, 2026.

The Company received contractually specified servicing fees of $102,000 and $109,000 for the three months ended March 31, 2026 and March 31, 2025, respectively. Loan servicing income on the condensed consolidated statements of income includes contractually specified servicing fees, mortgage servicing rights additions, amortization and changes in the valuation allowance.

Table of Contents

6. FAIR VALUE MEASUREMENTS

The Company utilizes fair value measurements to record fair value adjustments to certain assets and liabilities and to determine fair value disclosures. Securities available-for-sale are recorded at fair value on a recurring basis. Additionally, from time to time, the Company may be required to record at fair value other assets on a non-recurring basis, such as loans held-for-sale, loans held-for-investment and certain other assets. These non-recurring fair value adjustments typically involve application of lower of cost or market accounting or write-downs of individual assets. Transfers between levels of the fair value hierarchy are recognized on the actual date of the event or circumstances that caused the transfer, which generally corresponds with the Company’s quarterly valuation process.

Assets Recorded at Fair Value on a Recurring Basis

The table below presents the recorded amount of assets and liabilities measured at fair value on a recurring basis as of March 31, 2026 and December 31, 2025.


			*Quoted Prices*		*Significant*
			*in Active*		*Other*		*Significant*
			*Markets for*		*Observable*		*Unobservable*
(in thousands)			*Identical Assets*		*Inputs*		*Inputs*
March 31, 2026	*Fair Value*		*(Level 1)*		*(Level 2)*		*(Level 3)*
U.S. Treasury securities	$	90,312	$	90,312	$	—	$	—
Securities of U.S. government agencies and corporations		84,014		—		84,014		—
Obligations of states and political subdivisions		74,088		—		74,088		—
Collateralized mortgage obligations		94,305		—		94,305		—
Mortgage-backed securities		280,563		—		280,563		—
Total investments at fair value	$	623,282	$	90,312	$	532,970	$	—


			*Quoted Prices*		*Significant*
			*in Active*		*Other*		*Significant*
			*Markets for*		*Observable*		*Unobservable*
(in thousands)			*Identical Assets*		*Inputs*		*Inputs*
December 31, 2025	*Fair Value*		*(Level 1)*		*(Level 2)*		*(Level 3)*
U.S. Treasury securities	$	87,556	$	87,556	$	—	$	—
Securities of U.S. government agencies and corporations		85,344		—		85,344		—
Obligations of states and political subdivisions		75,003		—		75,003		—
Collateralized mortgage obligations		92,284		—		92,284		—
Mortgage-backed securities		277,056		—		277,056		—
Total investments at fair value	$	617,243	$	87,556	$	529,687	$	—

Table of Contents

Assets Recorded at Fair Value on a Non-Recurring Basis

Assets measured at fair value on a non-recurring basis are included in the table below by level within the fair value hierarchy as of March 31, 2026 and December 31, 2025.


(in thousands)	*Carrying*
March 31, 2026	*Value*		*Level 1*		*Level 2*		*Level 3*
Collateral dependent loans	$	815	$	—	$	—	$	815
Total assets at fair value	$	815	$	—	$	—	$	815


(in thousands)	*Carrying*
December 31, 2025	*Value*		*Level 1*		*Level 2*		*Level 3*
Collateral dependent loans	$	835	$	—	$	—	$	835
Total assets at fair value	$	835	$	—	$	—	$	835

There were no liabilities measured at fair value on a recurring or non-recurring basis at March 31, 2026 and December 31, 2025.

Key methods and assumptions used in measuring the fair value of collateral dependent loans as of March 31, 2026 were as follows:

	Method	Assumption Inputs

Collateral dependent loans	Collateral, market, income, enterprise, liquidation	External appraised values, management assumptions regarding market trends or other relevant factors, selling costs generally ranging from 6% to 10%

The following section describes the valuation methodologies used for assets and liabilities recorded at fair value.

Investment Securities Available-for-Sale

Investment securities available-for-sale are recorded at fair value on a recurring basis. Fair value measurement is based upon quoted market prices, if available. If quoted market prices are not available, fair values are measured using independent pricing models or other model-based valuation techniques such as the present value of future cash flows, adjusted for the security’s credit rating, prepayment assumptions, and other factors such as credit loss assumptions. Level 1 securities include those traded on an active exchange, such as the New York Stock Exchange, U.S. Treasury securities that are traded by dealers or brokers in active over-the-counter markets and money market funds. Level 2 securities include mortgage-backed securities issued by government sponsored entities, municipal bonds and corporate debt securities. Securities classified as Level 3 include asset-backed securities in less liquid markets where valuations include significant unobservable assumptions.

Collateral Dependent Loans

The Company does not record loans at fair value on a recurring basis. Loans that do not share similar risk characteristics are individually evaluated by management for potential impairment. Included in loans individually evaluated are collateral dependent loans. A loan is considered to be collateral dependent when repayment is expected to be provided substantially through the operation or sale of the collateral. Collateral dependent loans are considered to have unique risk characteristics and are individually evaluated. The ACL on collateral dependent loans is measured using the fair value of the underlying collateral, adjusted for costs to sell when applicable, less the amortized cost basis of the financial asset. If the value of underlying collateral is determined to be less than the recorded amount of the loan, a charge-off will be taken. Collateral dependent loans where a charge-off is recorded based on the fair value of collateral require classification in the fair value hierarchy. When a loan is evaluated based on the fair value of the underlying collateral securing the loan, the Company records the collateral dependent loan as non-recurring Level 3 given the valuation includes significant unobservable assumptions.

Table of Contents

Disclosures about Fair Value of Financial Instruments

The estimated fair values of the Company’s financial instruments for the periods ended March 31, 2026 and December 31, 2025 were approximately as follows:

			*March 31, 2026*				*December 31, 2025*
			*Carrying*		*Fair*		*Carrying*		*Fair*
	*Level*		*amount*		*value*		*amount*		*value*
(in thousands)
Financial assets:
Cash and cash equivalents		1	$	139,584	$	139,584	$	145,554	$	145,554
Certificates of deposit		2		10,172		10,217		10,180		10,243
Stock in Federal Home Loan Bank and other equity securities		3		10,871		10,871		10,871		10,871
Loans receivable:
Net loans		3		1,064,622		1,000,128		1,050,473		990,239
Interest receivable		2		7,299		7,299		7,348		7,348
Mortgage servicing rights		3		1,126		1,743		1,159		1,748
Financial liabilities:
Time deposits		3		139,959		139,912		141,661		141,713
Interest payable		2		660		660		724		724

Limitations

Fair value estimates are made at a specific point in time, based on relevant market information and information about the financial instrument and expected exit prices. These estimates do not reflect any premium or discount that could result from offering for sale at one time the Company’s entire holdings of a particular financial instrument. Because no market exists for a significant portion of the Company’s financial instruments, fair value estimates are based on judgments regarding future expected loss experience, current economic conditions, risk characteristics of various financial instruments, and other factors. These estimates are subjective in nature and involve uncertainties and matters of significant judgment and therefore cannot be determined with precision. Changes in assumptions could significantly affect the estimates.

Fair value estimates are based on existing on- and off-balance sheet financial instruments without attempting to estimate the value of anticipated future business and the value of assets and liabilities that are not considered financial instruments. Other significant assets and liabilities that are not considered financial assets or liabilities include deferred tax liabilities and premises and equipment. In addition, the tax ramifications related to the realization of the unrealized gains and losses can have a significant effect on fair value estimates and have not been considered in many of the estimates.

Table of Contents

7. COMMITMENTS AND CONTINGENCIES

The Company is a party to financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of its customers. These financial instruments include commitments to extend credit in the form of loans or through standby letters of credit. These instruments involve, to varying degrees, elements of credit and interest rate risk in excess of the amounts recognized in the balance sheet. The contract amounts of those instruments reflect the extent of involvement the Company has in particular classes of financial instruments.

The Bank’s exposure to credit loss in the event of non-performance by the other party to the financial instrument for commitments to extend credit and standby letters of credit is represented by the contractual notional amount of those instruments. The Bank uses the same credit policies in making commitments and conditional obligations as it does for on-balance sheet instruments.

Financial instruments, whose contract amounts represent credit risk at the indicated periods, were as follows:

(in thousands)	*March 31, 2026*		*December 31, 2025*
Undisbursed loan commitments	$	139,306	$	131,306
Standby letters of credit		1,038		1,038
Commitments to sell loans		770		—
	$	141,114	$	132,344

Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Since many of the commitments are expected to expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. The Bank evaluates each customer’s creditworthiness on a case-by-case basis. The amount of collateral obtained, if deemed necessary by the Bank upon extension of credit, is based on management’s credit evaluation. The types of collateral held varies but may include accounts receivable, inventory, property, plant and equipment, and income-producing commercial properties.

Standby letters of credit are conditional commitments issued by the Bank to guarantee the performance of a customer to a third party. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loan facilities to customers. The Bank issues both financial and performance standby letters of credit. The financial standby letters of credit are primarily to guarantee payment to third parties. At March 31, 2026 and December 31, 2025, there were no financial standby letters of credit outstanding. The performance standby letters of credit are typically issued to municipalities as specific performance bonds. Performance standby letters of credit totaled $1,038,000 for each of the periods ended March 31, 2026 and December 31, 2025. The Bank had experienced no draws on outstanding letters of credit, resulting in no related liability included on its balance sheet; however, should a triggering event occur, the Bank either has collateral in excess of the letter of credit or embedded agreements of recourse from the customer. The Bank has set aside a reserve for unfunded commitments in the amount of $1,100,000 and $1,200,000 at March 31, 2026 and December 31, 2025, respectively, which is recorded in "interest payable and other liabilities" on the condensed consolidated balance sheets.

Commitments to extend credit and standby letters of credit bear similar credit risk characteristics as outstanding loans. As of March 31, 2026 and December 31, 2025, the Company had no off-balance sheet derivatives requiring additional disclosure.

The Company may enter into interest rate lock commitments in connection with its mortgage banking activities to fund residential mortgage loans within specified times in the future. These commitments expose the Company to the risk that the price of the loan underlying the interest rate lock commitment might decline from the inception of the interest rate lock to the funding of the mortgage loan. To protect against this risk, the Company may enter into commitments to sell loans to economically hedge the risk of potential changes in the value of the loans that would result from the commitment. These commitments totaled $770,000 and $0 at March 31, 2026 and December 31, 2025, respectively. Mortgage loans sold to investors may be sold with servicing rights retained, for which the Company makes only standard legal representations and warranties as to meeting certain underwriting and collateral documentation standards. Management believes that any liabilities that may result from such recourse provisions are not significant.

Table of Contents

8. STOCK PLANS

On January 22, 2026, the Board of Directors of the Company declared a 5% stock dividend payable as of March 25, 2026 to shareholders of record as of February 27, 2026. All stock options and restricted stock amounts outstanding have been adjusted to give retroactive effect to stock dividends.

The following table presents the activity related to stock options for the three months ended March 31, 2026.

								*Weighted*
				*Weighted*				*Average*
				*Average*		*Aggregate*		*Remaining*
	*Number of*			*Exercise*		*Intrinsic*		*Contractual*
	*Shares*			*Price*		*Value*		*Term (in years)*
Options outstanding at Beginning of Period		422,527		$	7.80
Granted		—			—
Expired		—			—
Cancelled / Forfeited		—			—
Exercised		(52,552	)		4.90
Options outstanding at End of Period		369,975		$	8.21	$	2,842,951		3.25
Exercisable (vested) at End of Period		369,975		$	8.21	$	2,842,951		3.25

The intrinsic value of options exercised was $466,000 and $179,000 during the three months ended March 31, 2026 and March 31, 2025, respectively. The fair value of awards vested was $25,000 during each of the three months ended March 31, 2026 and March 31, 2025.

As of March 31, 2026, there was no unrecognized compensation cost related to non-vested stock options.

There was $6,000 of recognized compensation cost related to stock options granted for each of the three months ended March 31, 2026 and March 31, 2025.

The following table presents the activity related to non-vested restricted stock for the three months ended March 31, 2026.

								*Weighted*
				*Weighted*				*Average*
				*Average*		*Aggregate*		*Remaining*
	*Number of*			*Grant Date*		*Intrinsic*		*Contractual*
	*Shares*			*Fair Value*		*Value*		*Term (in years)*
Non-vested Restricted stock outstanding at Beginning of Period		283,907		$	8.05
Granted		60,079			13.99
Cancelled / Forfeited		(7,936	)		8.26
Exercised/Released/Vested		(49,776	)		8.49
Non-vested restricted stock outstanding at End of Period		286,274		$	9.21	$	4,548,894		3.20

The weighted average fair value of restricted stock granted during the three months ended March 31, 2026 was $13.99 per share.

As of March 31, 2026, there was $1,557,000 of total unrecognized compensation cost related to non-vested restricted stock. This cost is expected to be recognized over a weighted average period of approximately 3.20 years.

There was $94,000 and $184,000 of recognized compensation cost related to restricted stock awards for the three months ended March 31, 2026 and March 31, 2025, respectively.

Table of Contents

The Company has an Employee Stock Purchase Plan (“ESPP”). There are 315,000 shares authorized for issuance under the ESPP. The total number of shares authorized has been adjusted to give retroactive effect to stock dividends and stock splits, including the 5% stock dividend declared on January 22, 2026, payable March 25, 2026 to shareholders of record as of February 27, 2026. The ESPP will expire on March 15, 2036.

The ESPP is implemented by participation periods of not more than twenty-seven months each. The Board of Directors determines the commencement date and duration of each participation period. The Board of Directors approved the current participation period of December 2, 2025 to November 23, 2026. An eligible employee is one who has been continually employed for at least 90 days prior to commencement of a participation period. Under the terms of the ESPP, employees can choose to have up to 10 percent of their compensation withheld to purchase the Company’s common stock each participation period. The purchase price of the stock is 85 percent of the lower of the fair value on the last trading day before the date of participation or the fair value on the last trading day during the participation period.

As of March 31, 2026, there was $46,000 unrecognized compensation cost related to ESPP issuances. This cost is expected to be recognized over a weighted average period of approximately 0.75 years.

There was $15,000 and $8,000 of recognized compensation cost related to ESPP issuances for the three months ended March 31, 2026 and March 31, 2025, respectively.

The weighted average fair value at issuance date during the three months ended March 31, 2026 was $2.79 per share.

A summary of the weighted average assumptions used in valuing ESPP issuances during the three months ended March 31, 2026 is presented below.

	*Three Months Ended*
	*March 31, 2026*
Risk Free Interest Rate		3.59	%

Expected Dividend Yield		0.00	%

Expected Life in Years		1.00

Expected Price Volatility		13.67	%

Table of Contents

9. ACCUMULATED OTHER COMPREHENSIVE LOSS

The following table details activity in accumulated other comprehensive income (loss) for the three months ended March 31, 2026.

								*Accumulated*
	*Unrealized*			*Officers’*		*Directors’*		*other*
	*losses on*			*retirement*		*retirement*		*comprehensive*
(in thousands)	*securities*			*plan*		*plan*		*loss*
Balance as of December 31, 2025	$	(15,769	)	$	221	$	70	$	(15,478	)
Current period other comprehensive loss		(3,078	)		—		—		(3,078	)
Balance as of March 31, 2026	$	(18,847	)	$	221	$	70	$	(18,556	)

The following table details activity in accumulated other comprehensive income (loss) for the three months ended March 31, 2025.

								*Accumulated*
	*Unrealized*			*Officers’*		*Directors’*		*other*
	*gains (losses)*			*retirement*		*retirement*		*comprehensive*
(in thousands)	*on securities*			*plan*		*plan*		*gain (loss)*
Balance as of December 31, 2024	$	(34,157	)	$	207	$	99	$	(33,851	)
Current period other comprehensive income		8,886			—		—		8,886
Balance as of March 31, 2025	$	(25,271	)	$	207	$	99	$	(24,965	)

Table of Contents

10. OUTSTANDING SHARES AND EARNINGS PER SHARE

On January 22, 2026, the Board of Directors of the Company declared a 5% stock dividend payable March 25, 2026 to shareholders of record as of February 27, 2026. All income per share amounts have been adjusted to give retroactive effect to stock dividends.

Earnings Per Share (EPS)

Basic EPS includes no dilution and is computed by dividing net income available to common shareholders by the weighted average number of common shares outstanding for the respective period. Diluted EPS is computed by dividing net income available to common shareholders by the weighted average number of shares outstanding plus dilutive shares for the quarter. Diluted shares include all common stock equivalents (“in-the-money” stock options, unvested restricted stock, stock units, warrants and rights, convertible bonds and preferred stock), which reflects the potential dilution of securities that could share in the earnings of the Company.

The following table presents a reconciliation of basic and diluted EPS for the three months ended March 31, 2026 and 2025:

	*Three months ended*
	*March 31,*
(in thousands, except share and per share amounts):	*2026*		*2025*
Basic earnings per share:
Net income	$	5,906	$	3,671

Weighted average common shares outstanding		16,133,555		16,420,431
Basic EPS	$	0.37	$	0.22

Diluted earnings per share:
Net income	$	5,906	$	3,671

Weighted average common shares outstanding		16,133,555		16,420,431

Effect of dilutive shares		356,607		241,128

Adjusted weighted average common shares outstanding		16,490,162		16,661,559
Diluted EPS	$	0.36	$	0.22

Stock options not included in the computation of diluted earnings per share because they would have had an anti-dilutive effect amounted to 0 shares and 29,653 shares for the three months ended March 31, 2026 and 2025, respectively. Restricted stock not included in the computation of diluted earnings per share because they would have had an anti-dilutive effect amounted to 26,949 shares and 1,225 shares for the three months ended March 31, 2026 and 2025, respectively.

Table of Contents

11. LEASES

The Company leases ten branch and administrative locations under operating leases expiring on various dates through 2035. Leases with an initial term of 12 months or less are not recorded on the balance sheet and lease expense is recognized on a straight-line basis over the lease term. The Company had no financing leases as of March 31, 2026.

Most leases include options to renew, with renewal terms that can extend the lease term from 3 to 10 years. The exercise of lease renewal options is at the Company’s sole discretion. Most leases are currently in the extension period. For the remaining leases with options to renew, the Company has not included the extended lease terms in the calculation of lease liabilities as the options are not reasonably certain of being exercised. Certain lease agreements include rental payments that are adjusted periodically for inflation. The Company's lease agreements do not contain any residual value guarantees or restrictive covenants.

The Company uses its FHLB advance fixed rates, which are its incremental borrowing rates for secured borrowings, as the discount rates to calculate lease liabilities.

The Company had right-of-use assets totaling $5,072,000 and $5,393,000 as of March 31, 2026 and December 31, 2025, respectively. Right-of-use assets are included in Interest receivable and other assets on the condensed consolidated balance sheets. The Company had lease liabilities totaling $5,567,000 and $5,795,000 as of March 31, 2026 and December 31, 2025, respectively. Lease liabilities are included in Interest payable and other liabilities on the condensed consolidated balance sheets. The Company recognized lease expense totaling $292,000 and $283,000 for the three-month periods ended March 31, 2026 and 2025, respectively. Lease expense includes operating lease costs, short-term lease costs and variable lease costs. Lease expense is included in occupancy and equipment expense on the condensed consolidated statements of income.

The table below summarizes the maturity of remaining lease liabilities at March 31, 2026:

(in thousands)	*March 31, 2026*
2026 (remaining 9 months)	$	810
2027		1,029
2028		1,074
2029		1,025
2030		697
2031 and thereafter		1,672
Total lease payments		6,307
Less: interest		(740	)
Present value of lease liabilities	$	5,567

The following table presents supplemental cash flow information related to leases for the three months ended March 31, 2026:

	*Three months ended*
	*March 31,*
(in thousands)	*2026*		*2025*

Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from operating leases	$	278	$	260
Right-of-use assets obtained in exchange for new operating lease liabilities	$	—	$	—

The following table presents the weighted average operating lease term and discount rate as of March 31, 2026 and December 31, 2025:

	*March 31, 2026*			*December 31, 2025*

Weighted-average remaining lease term – operating leases, in years		6.33			6.52
Weighted-average discount rate – operating leases		3.53	%		3.51	%

Table of Contents

12. SEGMENT DISCLOSURES

The Company evaluated its operating segments in accordance with ASC 280, Segment Reporting, and determined it has one reportable segment, banking operations. The Company is engaged in a single line of business, indicative of a traditional banking institution, gathering deposits and originating loans in its primary market areas.

The Company manages its operations, allocates resources and monitors and reports its financials as a single operating segment. The Company's Chief Executive Officer is considered the Chief Operating Decision Maker. The Chief Operating Decision Maker evaluates segment performance using consolidated net income.

Loans, interest bearing accounts, investment securities, deposits, and non-interest income provide the revenues in banking operations and are presented in the Company's consolidated balance sheets. Interest expense, provisions for credit losses, salaries and employee benefits, occupancy and equipment, and data processing provide significant expenses in banking operations and are presented in the Company's consolidated statements of income. Segment performance is evaluated using consolidated net income with the majority of the Company's net income derived from net interest income.

The accounting policies for the segment is consistent with those described in Note 1 - Summary of Significant Accounting Policies to the consolidated financial statements in the Company’s 2025 Form 10-K.

Table of Contents

FIRST NORTHERN COMMUNITY BANCORP

ITEM 2. – MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

FORWARD-LOOKING STATEMENTS

This report may include forward-looking statements, which may include forecasts of our financial results and condition, expectations for our operations and business, and our assumptions for those forecasts and expectations. Do not rely unduly on forward-looking statements. Actual results might differ significantly compared to our forecasts, if any, and expectations. See Part I, Item 1A. “Risk Factors,” and the other risks described in our 2025 Form 10-K and Part II, Item 1A "Risk Factors" in this Quarterly Report on Form 10-Q and the other risks described in our Quarterly Reports on Form 10-Q, for factors to be considered when reading any forward-looking statements in this filing.

This report and other reports or statements which we may release may include forward-looking statements, which are subject to the “safe harbor” created by section 27A of the Securities Act of 1933, as amended, and section 21E of the Securities Exchange Act of 1934, as amended. We may make forward-looking statements in our Securities and Exchange Commission (SEC) filings, press releases, news articles and when we are speaking on behalf of the Company. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. Often, they include the words “believe,” “expect,” “target,” “anticipate,” “intend,” “plan,” “seek,” “strive,” “estimate,” “potential,” “project,” or words of similar meaning, or future or conditional verbs such as “will,” “would,” “should,” “could,” “might,” or “may.” These forward-looking statements are intended to provide investors with additional information with which they may assess our future potential. All of these forward-looking statements are based on assumptions about an uncertain future and are based on information available to us at the date of these statements. We do not undertake to update forward-looking statements to reflect facts, circumstances, assumptions or events that occur after the date any forward-looking statements are made, except as may be required by law.

In this document and in other SEC filings or other public statements, for example, we make forward-looking statements relating to the following topics, among others:

●

Our business objectives, strategies and initiatives, our organizational structure, the growth of our business and our competitive position and prospects, and the effect of competition on our business and strategies

●

Legal and regulatory actions, and future legislative and regulatory developments

●

Regulatory and compliance controls, processes and requirements and their impact on our business

●

The costs and effects of legal or regulatory actions

●

Expectations regarding draws on performance letters of credit and liabilities that may result from recourse provisions in standby letters of credit

●

Our intent to sell or hold, and the likelihood that we would be required to sell, various investment securities

●

Our regulatory capital requirements, including the capital rules established after the 2008 financial crisis by the U.S. federal banking agencies and our current intention not to elect to use the community bank leverage ratio framework

●

Expectations regarding our non-payment of a cash dividend on our common stock in the foreseeable future

●

Credit quality and provision for credit losses and management of asset quality and credit risk, expectations regarding collections and the timing thereof

●

Our allowances for credit losses, including the conditions we consider in determining the unallocated allowance and our portfolio credit quality, the adequacy of the allowance for credit losses, underwriting standards, and risk grading

●

Our assessment of economic conditions and trends and credit cycles and their impact on our business including the imposition of tariffs on imported goods to the U.S.

Table of Contents

●

The seasonal nature of our business

●

The impact of changes in interest rates and our strategy to manage our interest rate risk profile and the possible effect of changes in residential mortgage interest rates on new originations and refinancing of existing residential mortgage loans

●

Loan portfolio composition and risk grade trends, expected charge-offs, portfolio credit quality, loan demand, our strategy regarding loan modifications, delinquency rates and our underwriting standards and our expectations regarding our recognition of interest income on loans that were provided payment deferrals upon completion of the payment forbearance period

●

Our deposit base including renewal of time deposits and the outlook for deposit balances

●

The impact on our net interest income and net interest margin of changes in interest rates

●

The effect of possible changes in the initiatives and policies of the federal and state bank regulatory agencies, as well as the Public Company Accounting Oversight Board, the Financial Accounting Standards Board, the Securities and Exchange Commission and other standard setters

●

Tax rates and the impact of changes in the U.S. tax laws

●

Our pension and retirement plan costs

●

Our liquidity strategies and beliefs concerning the adequacy of our liquidity, sources and amounts of funds and ability to satisfactorily manage our liquidity

●

Critical accounting policies and estimates, the impact or anticipated impact of recent accounting pronouncements or changes in accounting principles

●

Expected rates of return, maturities, loss exposure, growth rates, yields, and projected results

●

The possible impact of weather-related or other natural conditions, including drought, fire or flooding, seismic events, and related governmental responses, including related electrical power outages, on economic conditions, especially in the agricultural sector

●

Maintenance of insurance coverages appropriate for our operations

●

Threats to the banking sector and our business due to cybersecurity issues and attacks and regulatory expectations related to cybersecurity

●

The possible effects on community banks and our business from the failures of other banks

	●	The possible adverse impacts on the banking industry and our business from a period of significant, prolonged inflation

	●	Descriptions of assumptions underlying or relating to any of the foregoing

Readers of this document should not rely on any forward-looking statements, which reflect only our management’s belief as of the date of this report. There are numerous risks and uncertainties that could and will cause actual results to differ materially from those discussed in our forward-looking statements. Many of these factors are beyond our ability to control or predict and could have a material adverse effect on our financial condition and results of operations or prospects. Such risks and uncertainties include, but are not limited to those listed in Item 1A “Risk Factors” of Part II of this Form 10-Q, Item 2 “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of Part I of this Form 10-Q and "Risk Factors" and “Supervision and Regulation” in our 2025 Form 10-K, and in our other reports to the SEC.

Table of Contents

INTRODUCTION

This overview of Management’s Discussion and Analysis highlights selected information in this report and may not contain all of the information that is important to you. For a more complete understanding of trends, events, commitments, uncertainties, liquidity, capital resources and critical accounting estimates, you should carefully read this entire report and our other reports to the SEC, together with our Consolidated Financial Statements and the Notes to Consolidated Financial Statements included in our 2025 Form 10-K.

Our subsidiary, First Northern Bank of Dixon (the “Bank”), is a California state-chartered bank that derives most of its revenues from lending and deposit taking in the Sacramento Valley region of Northern California. Interest rates, business conditions and customer confidence all affect our ability to generate revenues. In addition, the regulatory and compliance environment and competition can present challenges to our ability to generate those revenues.

Significant results and developments during the first quarter and year-to-date 2026 included:

●	Net income of $5.9 million for the three months ended March 31, 2026, up 60.9% from net income of $3.7 million earned for the same period last year.

●	Diluted income per share of $0.36 for the three months ended March 31, 2026, up 63.6% from diluted income per share of $0.22 for the same period last year.

●	Net interest income of $17.2 million for the three months ended March 31, 2026, up 7.9% from net interest income of $15.9 million for the same period last year.

●	Net interest margin of 3.83% for the three months ended March 31, 2026, up 5.2% from net interest margin of 3.64% for the same period last year.

●	Provision for credit losses of $0.3 million for the three months ended March 31, 2026, down 64.7% from provision for credit losses of $0.9 million for the same period last year.

●	Total assets of $1.92 billion as of March 31, 2026, up 0.7% from $1.91 billion as of December 31, 2025.

●	Total net loans (including loans held-for-sale) of $1.06 billion as of March 31, 2026, up 1.3% from $1.05 billion as of December 31, 2025.

●	Total investment securities of $623.3 million as of March 31, 2026, up 1.0% from $617.2 million as of December 31, 2025.

●	Total deposits of $1.69 billion as of March 31, 2026, up 0.9% from $1.68 billion as of December 31, 2025.

Table of Contents

SUMMARY FINANCIAL DATA

The Company recorded net income of $5,906,000 for the three months ended March 31, 2026, representing an increase of $2,235,000, or 60.9%, from net income of $3,671,000 for the same period in 2025.

The following tables present a summary of the results for the three months ended March 31, 2026 and 2025, and a summary of financial condition at March 31, 2026 and December 31, 2025.

	Three Months Ended			Three Months Ended
	March 31, 2026			March 31, 2025
(in thousands, except per share amounts and ratios)
For the Period:
Net Income	$	5,906		$	3,671
Basic Earnings Per Common Share	$	0.37		$	0.22
Diluted Earnings Per Common Share	$	0.36		$	0.22
Return on Average Assets (annualized)		1.24	%		0.79	%
Return on Average Equity (annualized)		11.21	%		8.23	%
Average Equity to Average Assets		11.10	%		9.65	%

	March 31, 2026			December 31, 2025
(in thousands, except ratios)
At Period End:
Total Assets	$	1,924,548		$	1,910,950
Total Investment Securities, at fair value	$	623,282		$	617,243
Total Loans, Net (including loans held-for-sale)	$	1,064,622		$	1,050,473
Total Deposits	$	1,694,698		$	1,679,143
Loan-To-Deposit Ratio		62.8	%		62.6	%

Table of Contents

FIRST NORTHERN COMMUNITY BANCORP

Distribution of Average Statements of Condition and Analysis of Net Interest Income

	Three months ended							Three months ended
	March 31, 2026							March 31, 2025
	Average				Yield/			Average				Yield/
(in thousands, except percentages)	Balance		Interest		Rate (4)			Balance		Interest		Rate (4)
Assets
Interest-earning assets:
Loans (1)	$	1,044,166	$	14,322		5.56	%	$	1,042,559	$	13,602		5.29	%
Certificate of deposits		10,558		106		4.07	%		15,868		161		4.11	%
Interest bearing due from banks		125,045		1,098		3.56	%		70,468		727		4.18	%
Investment securities, taxable		573,637		4,434		3.13	%		587,332		4,348		3.00	%
Investment securities, non-taxable (2)		57,685		447		3.14	%		50,403		393		3.16	%
Other interest earning assets		10,870		555		20.71	%		10,518		272		10.49	%
Total average interest-earning assets		1,821,961		20,962		4.67	%		1,777,148		19,503		4.45	%
Non-interest-earning assets:
Cash and due from banks		29,481							34,338
Premises and equipment, net		8,693							9,145
Interest receivable and other assets		65,134							52,755
Total average assets	$	1,925,269						$	1,873,386

Liabilities and Stockholders’ Equity:
Interest-bearing liabilities:
Interest-bearing transaction deposits		444,368		766		0.70	%		432,335		691		0.65	%
Savings and MMDA’s		475,494		1,809		1.54	%		451,198		1,550		1.39	%
Time, $250,000 or less		85,614		723		3.42	%		99,503		973		3.97	%
Time, over $250,000		55,793		460		3.34	%		44,028		346		3.19	%
Total average interest-bearing liabilities		1,061,269		3,758		1.44	%		1,027,064		3,560		1.41	%
Non-interest-bearing liabilities:
Non-interest-bearing demand deposits		632,800							651,590
Interest payable and other liabilities		17,462							13,919
Total liabilities		1,711,531							1,692,573
Total average stockholders’ equity		213,738							180,813
Total average liabilities and stockholders’ equity	$	1,925,269						$	1,873,386
Net interest income and net interest margin (3)			$	17,204		3.83	%			$	15,943		3.64	%

(1)

Average balances for loans include loans held-for-sale and non-accrual loans and are net of the allowance for credit losses, but non-accrued interest thereon is generally excluded. Loan interest income includes loan fees, net of deferred costs of approximately $5 and $(8) for the three months ended March 31, 2026 and 2025, respectively.

(2)	Interest income and yields on tax-exempt securities are not presented on a taxable-equivalent basis.

(3)	Net interest margin is computed by dividing net interest income by total average interest-earning assets.

(4)	For disclosure purposes, yield /rates are annualized by dividing the number of days in the reported period by 365.

Table of Contents

FIRST NORTHERN COMMUNITY BANCORP

Distribution of Average Statements of Condition and Analysis of Net Interest Income

	Three months ended							Three months ended
	March 31, 2026							December 31, 2025
	Average				Yield/			Average				Yield/
(in thousands, except percentages)	Balance		Interest		Rate			Balance		Interest		Rate (4)
Assets
Interest-earning assets:
Loans (1)	$	1,044,166	$	14,322		5.56	%	$	1,050,919	$	15,179		5.73	%
Certificates of deposit		10,558		106		4.07	%		11,709		122		4.13	%
Interest bearing due from banks		125,045		1,098		3.56	%		139,963		1,465		4.15	%
Investment securities, taxable		573,637		4,434		3.13	%		557,389		4,230		3.01	%
Investment securities, non-taxable (2)		57,685		447		3.14	%		56,151		439		3.10	%
Other interest earning assets		10,870		555		20.71	%		10,871		251		9.16	%
Total average interest-earning assets		1,821,961		20,962		4.67	%		1,827,002		21,686		4.71	%
Non-interest-earning assets:
Cash and due from banks		29,481							31,324
Premises and equipment, net		8,693							8,466
Interest receivable and other assets		65,134							66,699
Total average assets	$	1,925,269						$	1,933,491

Liabilities and Stockholders’ Equity:
Interest-bearing liabilities:
Interest-bearing transaction deposits		444,368		766		0.70	%		427,612		770		0.71	%
Savings and MMDA’s		475,494		1,809		1.54	%		471,222		1,928		1.62	%
Time, $250,000 and under		85,614		723		3.42	%		89,058		973		4.33	%
Time, over $250,000		55,793		460		3.34	%		54,256		286		2.09	%
Total average interest-bearing liabilities		1,061,269		3,758		1.44	%		1,042,148		3,957		1.51	%
Non-interest-bearing liabilities:
Non-interest-bearing demand deposits		632,800							665,760
Interest payable and other liabilities		17,462							17,496
Total liabilities		1,711,531							1,725,404
Total average stockholders’ equity		213,738							208,087
Total average liabilities and stockholders’ equity	$	1,925,269						$	1,933,491
Net interest income and net interest margin (3)			$	17,204		3.83	%			$	17,729		3.85	%

(1)

Average balances for loans include loans held-for-sale and non-accrual loans and are net of the allowance for credit losses, but non-accrued interest is generally excluded. Loan interest income includes loan fees, net of deferred costs of approximately $5 and $(212) for the three months ended March 31, 2026 and December 31, 2025, respectively.

(2)	Interest income and yields on tax-exempt securities are not presented on a taxable equivalent basis.

(3)	Net interest margin is computed by dividing net interest income by total average interest-earning assets.

(4)	For disclosure purposes, yield/rates are annualized by dividing the number of days in the reported period by 365.

Table of Contents

Analysis of Changes

in Interest Income and Interest Expense

Following is an analysis of changes in interest income and expense (dollars in thousands) for the three months ended March 31, 2026 over the three months ended March 31, 2025 and the three months ended March 31, 2026 over the three months ended December 31, 2025. Changes not solely due to interest rate or volume have been allocated proportionately to interest rate and volume.

	Three Months Ended									Three Months Ended
	March 31, 2026									March 31, 2026
	Over									Over
	Three Months Ended									Three Months Ended
	March 31, 2025									December 31, 2025
				Interest									Interest
	Volume			Rate			Change			Volume			Rate			Change
(in thousands)
Increase (Decrease) in Interest Income:

Loans	$	21		$	699		$	720		$	(152	)	$	(705	)	$	(857	)
Certificates of Deposit		(53	)		(2	)		(55	)		(14	)		(2	)		(16	)
Due From Banks		494			(123	)		371			(158	)		(209	)		(367	)
Investment Securities - Taxable		(104	)		190			86			86			118			204
Investment Securities - Non-taxable		57			(3	)		54			5			3			8
Other Assets		9			274			283			—			304			304
	$	424		$	1,035		$	1,459		$	(233	)	$	(491	)	$	(724	)

Increase (Decrease) in Interest Expense:

Deposits:
Interest-Bearing Transaction Deposits	$	20		$	55		$	75		$	13		$	(17	)	$	(4	)
Savings & MMDAs		86			173			259			11			(130	)		(119	)
Time Certificates		(29	)		(107	)		(136	)		(64	)		(12	)		(76	)
FHLB advances		—			—			—			—			—			—

	$	77		$	121		$	198		$	(40	)	$	(159	)	$	(199	)

Increase (Decrease) in Net Interest Income:	$	347		$	914		$	1,261		$	(193	)	$	(332	)	$	(525	)

Table of Contents

CHANGES IN FINANCIAL CONDITION

The assets of the Company set forth in the Unaudited Condensed Consolidated Balance Sheets reflect a $5,970,000, or 4.1%, decrease in cash and cash equivalents, a $6,039,000, or 1.0%, increase in investment securities available-for-sale, and a $14,149,000, or 1.3%, increase in net loans held-for-investment from December 31, 2025 to March 31, 2026. The decrease in cash and cash equivalents was primarily due to an increase in investment securities due to purchases of investment securities and an increase in loans due to net loan originations, which was partially offset by an increase in deposit balances. The increase in investment securities was due to purchases of available-for-sale securities, which was partially offset by paydowns and maturities of available-for-sale securities. The increase in net loans held-for-investment was primarily due to net originations of commercial loans, which was partially offset by net payoffs of commercial real estate, agriculture, residential mortgage and consumer loans.

The liabilities of the Company set forth in the Unaudited Condensed Consolidated Balance Sheets reflect an increase in total deposits of $15,555,000, or 0.9%, from December 31, 2025 to March 31, 2026. The overall increase in total deposits was primarily due to seasonal fluctuations due to changes in market conditions and monetary policy.

CHANGES IN RESULTS OF OPERATIONS

Interest Income

The Federal Open Market Committee kept the Federal Reserve's benchmark rate range at 3.50% to 3.75% during the three months ended March 31, 2026.

Interest income on loans for the three months ended March 31, 2026 was up 5.3% from the same period in 2025, increasing from $13,602,000 to $14,322,000. The increase in interest income on loans for the three months ended March 31, 2026 as compared to the same period a year ago was primarily due to a 27 basis point increase in yield on loans coupled with an increase in average balance of loans.

Interest income on certificates of deposit for the three months ended March 31, 2026 was down 34.2% from the same period in 2025, decreasing from $161,000 to $106,000. The decrease in interest income on certificates of deposit for the three months ended March 31, 2026 as compared to the same period a year ago was primarily due to a decrease in average balances of certificates of deposit coupled with a 4 basis point decrease in yield on certificates of deposit.

Interest income on interest-bearing due from banks for the three months ended March 31, 2026 was up 51.0% from the same period in 2025, increasing from $727,000 to $1,098,000. The increase in interest income on interest-bearing due from banks for the three months ended March 31, 2026 as compared to the same period a year ago was primarily due to an increase in average balances of interest-bearing due from banks, which was partially offset by a 62 basis point decrease in yield on interest-bearing due from banks.

Interest income on investment securities available-for-sale for the three months ended March 31, 2026 was up 3.0% from the same period in 2025, increasing from $4,741,000 to $4,881,000. The increase in interest income on investment securities for the three months ended March 31, 2026 as compared to the same period a year ago was primarily due to a 13 basis point increase in investment yields, which was partially offset by a decrease in average investment securities.

Interest income on other earning assets for the three months ended March 31, 2026 was up 104.0% from the same period in 2025, increasing from $272,000 to $555,000. This income is primarily derived from dividends received from the Federal Home Loan Bank. The increase in interest income on other earning assets for the three months ended March 31, 2026 as compared to the same period a year ago was primarily due to a special cash dividend issued by the Federal Home Loan Bank during the three months ended March 31, 2026.

The Company had no Federal Funds sold balances during the three months ended March 31, 2026 and March 31, 2025.

Interest Expense

Interest expense on interest-bearing liabilities for the three months ended March 31, 2026 was up 5.6% from the same period in 2025, increasing from $3,560,000 to $3,758,000. The increase in interest expense for the three months ended March 31, 2026 as compared to the same period a year ago was primarily due to an increase in average balance of interest-bearing liabilities coupled with a 3 basis point increase in average interest-bearing deposit yield.

Table of Contents

Provision for Credit Losses

Provision for credit losses for the three months ended March 31, 2026 was down 64.7% from the same period in 2025, decreasing from $850,000 to $300,000. The decrease was primarily due to a decrease in nonaccrual loans requiring specific reserves, which was partially offset by an increase in reserves on pooled loans due to an increase in qualitative factors due to geopolitical risks.

Non-Interest Income

Non-interest income was up 19.8% for the three months ended March 31, 2026 from the same period in 2025, increasing from $1,453,000 to $1,740,000. The increase was primarily driven by an increase in investment and brokerage services income due to the Beacon Wealth client acquisition in the fourth quarter of 2025.

Non-Interest Expenses

Total non-interest expenses were down 4.8% for the three months ended March 31, 2026 from the same period in 2025, decreasing from $11,590,000 to $11,032,000. The decrease was primarily due to decreases in occupancy and equipment expense and other expenses, which was partially offset by increases in salaries and employee benefits and amortization of intangible assets. The decrease in occupancy and equipment expense was primarily due to the prior year upgrades to facilities which were not repeated in the current year. The decrease in other expenses was primarily due to decreases in consulting fees and loan collection expense. The increase in salaries and employee benefits was primarily due to an increase in full-time equivalent employees. The increase in amortization of intangible assets was due to the acquisition of a customer-related intangible asset during the fourth quarter of 2025.

The following table sets forth other non-interest expenses by category for the three months ended March 31, 2026 and 2025.

	Three months ended		Three months ended
(in thousands)	March 31, 2026		March 31, 2025
Other non-interest expenses
FDIC assessments	$	218	$	223
Contributions		70		130
Legal fees		79		67
Accounting and audit fees		158		173
Consulting fees		199		458
Postage expense		26		44
Telephone expense		66		45
Public relations		102		75
Training expense		13		39
Loan origination expense (recovery)		65		(5	)
Sundry losses		94		111
Loan collection expense		50		159
Debit card expense		240		264
Other non-interest expense		467		746

Total other non-interest expenses	$	1,847	$	2,529

Table of Contents

Income Taxes

The Company’s tax rate, the Company’s income before taxes and the amount of tax relief provided by non-taxable earnings affect the Company’s provision for income taxes. Provision for income taxes increased 32.8% for the three months ended March 31, 2026 from the same period in 2025, increasing from $1,285,000 to $1,706,000. The effective tax rate was 22.4% and 25.9% for the three months ended March 31, 2026 and March 31, 2025, respectively. The increase in provision for income taxes for the three months ended March 31, 2026 as compared to the same period a year ago was primarily due to an increase in pre-tax income. The decrease in the effective tax rate was primarily due to the execution of a tax planning strategy that involved purchasing investment tax credits tied to alternative energy projects. The investment tax credits were acquired at a discount and the majority was recognized as a reduction to income tax expense in the third quarter of 2025, with the remaining credits recognized in the first quarter of 2026.

Off-Balance Sheet Commitments

The following table shows the distribution of the Company’s undisbursed loan commitments at the dates indicated.

(in thousands)	March 31, 2026		December 31, 2025
Undisbursed loan commitments	$	139,306	$	131,306
Standby letters of credit		1,038		1,038
Commitments to sell loans		770		—
	$	141,114	$	132,344

The reserve for unfunded lending commitments amounted to $1,100,000 and $1,200,000 as of March 31, 2026 and December 31, 2025, respectively. The reserve for unfunded lending commitments is included in other liabilities on the Condensed Consolidated Balance Sheets. See Note 7 of the Notes to Condensed Consolidated Financial Statements of this Form 10-Q, "Commitments and Contingencies," for additional information.

Table of Contents

Asset Quality

The Company manages asset quality and credit risk by maintaining diversification in its loan portfolio and through review processes that include analysis of credit requests and ongoing examination of outstanding loans and delinquencies, with particular attention to portfolio dynamics and loan mix. The Company strives to identify loans experiencing difficulty early enough to correct the problems, to record charge-offs promptly based on realistic assessments of collectability and current collateral values and to maintain an adequate allowance for credit losses at all times. Asset quality reviews of loans and other non-performing assets are administered using credit risk-rating standards and criteria similar to those employed by state and federal banking regulatory agencies. The federal bank regulatory agencies utilize the following definitions for assets adversely classified for supervisory purposes:

●

Substandard Assets – A substandard asset is inadequately protected by the current sound worth and paying capacity of the obligor or of the collateral pledged, if any. Assets so classified have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the institution will sustain some loss if the deficiencies are not corrected.

●

Doubtful Assets – An asset classified doubtful has all the weaknesses inherent in one classified substandard with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable or improbable.

Other Real Estate Owned and loans rated Substandard and Doubtful are deemed "classified assets". This category, which includes both performing and non-performing assets, receives an elevated level of attention regarding collection.

The following table summarizes the Company’s non-accrual loans net of guarantees of the State of California and U.S. Government by loan category at March 31, 2026 and December 31, 2025:

	At March 31, 2026						At December 31, 2025
	Gross		Guaranteed		Net		Gross		Guaranteed		Net
(in thousands)

Commercial	$	139	$	139	$	—	$	139	$	139	$	—
Commercial real estate		909		—		909		657		—		657
Agriculture		3,212		793		2,419		4,423		809		3,614
Residential mortgage		162		—		162		174		—		174
Residential construction		—		—		—		—		—		—
Consumer		496		—		496		637		—		637
Total non-accrual loans	$	4,918	$	932	$	3,986	$	6,030	$	948	$	5,082

It is generally the Company’s policy to discontinue interest accruals once a loan is past due for a period of 90 days as to interest or principal payments unless the loan is well secured and in process of collection. When a loan is placed on non-accrual, interest accruals cease and uncollected accrued interest is reversed and charged against current income. Payments received on non-accrual loans are applied against principal. A loan may only be restored to an accruing basis when it again becomes well secured and in the process of collection or all past due amounts have been collected or there is an extended period of positive performance and a high probability that the loan will continue to pay according to original terms.

Non-accrual loans amounted to $4,918,000 at March 31, 2026 and were comprised of one commercial loan totaling $139,000, two commercial real estate loans totaling $909,000, four agriculture loans totaling $3,212,000, three residential mortgage loans totaling $162,000 and four consumer loans totaling $496,000. Non-accrual loans amounted to $6,030,000 at December 31, 2025 and were comprised of one commercial loan totaling $139,000, one commercial real estate loan totaling $657,000, four agriculture loans totaling $4,423,000, three residential mortgage loans totaling $174,000 and five consumer loans totaling $637,000.

A loan is considered to be collateral dependent when repayment is expected to be provided substantially through the operation or sale of the collateral. The ACL on collateral dependent loans is measured using the fair value of the underlying collateral, adjusted for costs to sell when applicable, less the amortized cost basis of the financial asset. It is generally the Company’s policy that if the value of the underlying collateral is determined to be less than the recorded amount of the loan, a charge-off will be taken.

Table of Contents

As the following table illustrates, total non-performing assets, net of guarantees of the State of California and U.S. Government, including its agencies and its government-sponsored agencies, decreased $1,096,000, or 17.3%, to $5,227,000 during the first three months of 2026. Non-performing assets, net of guarantees, represented 0.3% of total assets at March 31, 2026.

	At March 31, 2026							At December 31, 2025
	Gross		Guaranteed		Net			Gross		Guaranteed		Net
(dollars in thousands)

Non-accrual loans	$	4,918	$	932	$	3,986		$	6,030	$	948	$	5,082
Loans 90 days past due and still accruing		—		—		—			—		—		—

Total non-performing loans		4,918		932	$	3,986			6,030		948	$	5,082
Other real estate owned		1,241		—		1,241			1,241		—		1,241
Total non-performing assets	$	6,159	$	932	$	5,227		$	7,271	$	948	$	6,323

Non-performing loans (net of guarantees) to total loans						0.4	%						0.5	%
Non-performing assets (net of guarantees) to total assets						0.3	%						0.3	%
Allowance for credit losses to non-performing loans (net of guarantees)						371.4	%						285.7	%

The Company had no loans that were 90 days or more past due and still accruing as of March 31, 2026 and December 31, 2025.

Excluding non-performing loans, loans totaling $18,447,000 and $18,259,000 were classified as substandard or doubtful loans, representing potential problem loans at March 31, 2026 and December 31, 2025, respectively. Management believes that the allowance for credit losses at March 31, 2026 and December 31, 2025 appropriately reflected expected credit losses in the loan portfolio at that date. The ratio of the allowance for credit losses to total loans was 1.37% and 1.36% at March 31, 2026 and December 31, 2025, respectively.

Other real estate owned (“OREO”) consists of property that the Company has acquired by deed in lieu of foreclosure or through foreclosure proceedings, and property that the Company does not hold title to but is in actual control of, known as in-substance foreclosure. OREO can also consist of Company owned properties that the Company has determined are no longer intended for use or future development. The estimated fair value of the property is determined prior to transferring the balance to OREO. The balance transferred to OREO is the estimated fair value of the property less estimated cost to sell. Impairment may be deemed necessary to bring the book value of the loan equal to the appraised value. Appraisals or loan officer evaluations are then conducted periodically thereafter charging any additional impairment to the appropriate expense account. The Company had OREO totaling $1,241,000 for each of the periods ended March 31, 2026 and December 31, 2025. As of March 31, 2026 and December 31, 2025, OREO represented land, transferred from premises and equipment, that the Company determined is no longer intended for future development and is actively marketing for sale.

Table of Contents

Allowance for Credit Losses (ACL)

The Company's ACL is maintained at a level believed by management to appropriately reflect expected credit losses inherent in the loan portfolio. The ACL is increased by provisions charged to operating expense and reduced by net charge-offs. The Company contracts with vendors for credit reviews of the loan portfolio and utilizes historical loss trends and the remaining contractual lives of the loan portfolios to determine estimated credit losses through a reasonable and supportable forecast period. The ACL is based on estimates, and actual losses may vary from current estimates.

The following table summarizes the ACL of the Company during the three months ended March 31, 2026 and 2025, and for the year ended December 31, 2025:

Analysis of the Allowance for Credit Losses

	Three months ended						Year ended
	March 31,						December 31,
	2026			2025			2025
(in thousands, except ratios)
Balance at beginning of period	$	14,519		$	15,885		$	15,885
Provision for credit losses		400			600			(500	)
Loans charged-off:
Commercial		(139	)		(10	)		(648	)
Commercial Real Estate		—			—			(26	)
Agriculture		—			—			(474	)
Residential Mortgage		—			—			(5	)
Residential Construction		—			—			—
Consumer		(1	)		(6	)		(19	)

Total charged-off		(140	)		(16	)		(1,172	)

Recoveries:
Commercial		3			65			273
Commercial Real Estate		—			—			—
Agriculture		20			—			—
Residential Mortgage		—			—			—
Residential Construction		—			—			—
Consumer		1			1			33

Total recoveries		24			66			306

Net (charge-offs) recoveries		(116	)		50			(866	)

Balance at end of period	$	14,803		$	16,535		$	14,519

Ratio of net (charge-offs) recoveries to average loans outstanding during the period (annualized)		(0.05	)%		0.02	%		(0.08	)%
Allowance for credit losses to total loans		1.37	%		1.56	%		1.36	%
Nonaccrual loans to total loans		0.46	%		1.31	%		0.57	%
Allowance for credit losses to nonaccrual loans		301.00	%		119.43	%		240.78	%

Table of Contents

Deposits

Deposits are one of the Company’s primary sources of funds. At March 31, 2026 and December 31, 2025, the Company had the following deposit mix:

	March 31, 2026			December 31, 2025

Non-interest bearing transaction		37.0	%		37.7	%
Interest-bearing transaction		26.2	%		26.1	%
Savings and MMDA		28.5	%		27.8	%
Time		8.3	%		8.4	%

The Company obtains deposits primarily from the communities it serves. The Company believes that no material portion of its deposits has been obtained from or is dependent on any one person or industry. The Company accepts deposits in excess of $250,000 from customers. These deposits are priced to remain competitive.

Maturities of time certificates of deposit of over $250,000 outstanding at March 31, 2026 and December 31, 2025 are summarized as follows:


(in thousands)	March 31, 2026		December 31, 2025
Three months or less	$	17,723	$	18,034
Over three to six months		16,405		14,471
Over six to twelve months		14,846		14,924
Over twelve months		6,248		6,201
Total	$	55,222	$	53,630

Approximately 43% and 40% of our deposits were uninsured as of March 31, 2026 and December 31, 2025, respectively.

Liquidity and Capital Resources

In order to serve our market area and comply with banking regulations, the Company must maintain adequate liquidity and adequate capital. Liquidity refers to the Company’s ability to provide funds at an acceptable cost to meet loan demand and deposit withdrawals, as well as contingency plans to meet unanticipated funding needs or loss of funding sources. These objectives can be met from either the asset or liability side of the balance sheet.

Asset liquidity sources consist of the repayments and maturities of loans, selling of loans, short-term money market investments, maturities of securities and sales of securities from the available-for-sale portfolio. These activities are generally summarized as investing activities in the Condensed Consolidated Statements of Cash Flows. For the three months ended March 31, 2026, net liquidity used in investing activities totaled $24,617,000.

The Company’s available-for-sale investment securities plus cash and cash equivalents in excess of reserve requirements and certificates of deposit totaled $773,038,000 on March 31, 2026, which was 40.2% of assets at that date. This was a decrease of $61,000 from $772,977,000 and 40.4% of assets as of December 31, 2025. The Company’s investment securities are generally shorter term in nature to provide ongoing cash flows for liquidity needs and/or reinvestment for interest rate risk management. On March 31, 2026, the effective duration of our investment securities was 3.11 with projected principal cashflow of $116,255,000 for the remainder of 2026 available for reinvestment or liquidity needs. The Company had no held-to-maturity securities as of March 31, 2026 and December 31, 2025.

Liquidity may also be impacted from liabilities through changes in deposits and borrowings outstanding. These activities are included under financing activities in the Condensed Consolidated Statements of Cash Flows. As of March 31, 2026, the Company had $0 in borrowings outstanding. For the three months ended March 31, 2026, net liquidity provided by financing activities totaled $14,393,000, primarily due to a net increase in deposits. While these sources of funds are expected to continue to provide significant amounts of funds in the future, their mix, as well as the possible use of other sources, will depend on future economic and market conditions.

Liquidity is also provided or used through the results of operating activities. For the three months ended March 31, 2026, net cash provided by operating activities totaled $4,254,000, primarily as a result of net income during the three months ended March 31, 2026.

Table of Contents

Liquidity is measured by various ratios, in management’s opinion, the most common being the ratio of net loans to deposits (including loans held-for-sale). This ratio was 62.8% and 62.6% as of March 31, 2026 and December 31, 2025, respectively.

Loan demand during the remainder of 2026 will depend in part on economic and competitive conditions. The Company emphasizes the solicitation of non-interest-bearing demand deposits and money market checking accounts, which are the least sensitive to interest rates. The outlook for deposit balances during the remainder of 2026 is subject to actions by the Federal Reserve and heightened competition.

To meet unanticipated funding requirements, the Company maintains short-term unsecured lines of credit with other banks which totaled $130,000,000 at March 31, 2026. Additionally, the Company has a line of credit with the FHLB, with a remaining borrowing capacity at March 31, 2026 of $354,702,000; credit availability is subject to certain collateral requirements.

The Company’s primary source of liquidity on a stand-alone basis is dividends from the Bank. Dividends from the Bank are subject to regulatory restrictions.

In July 2013, the Federal Reserve and the other U.S. federal banking agencies adopted final rules making significant changes to the U.S. regulatory capital framework for U.S. banking organizations and to conform this framework to the guidelines published by the Basel Committee known as the Basel III Global Regulatory Framework for Capital and Liquidity. The Basel Committee is a committee of banking supervisory authorities from major countries in the global financial system which formulates broad supervisory standards and guidelines relating to financial institutions for implementation on a country-by-country basis. These rules adopted by the Federal Reserve and the other federal banking agencies (the U.S. Basel III Capital Rules) replaced the federal banking agencies’ general risk-based capital rules, advanced approaches rule, market risk rule, and leverage rules, in accordance with certain transition provisions.

Banks, such as First Northern, became subject to the final rules on January 1, 2015. The final rules implemented higher minimum capital requirements, included a new common equity Tier 1 capital requirement, and established criteria that instruments must meet in order to be considered common equity Tier 1 capital, additional Tier 1 capital, or Tier 2 capital. The final rules provide for increased minimum capital ratios as follows: (a) a common equity Tier 1 capital ratio of 4.5%; (b) a Tier 1 capital ratio of 6%; (c) a total capital ratio of 8%; and (d) a Tier 1 leverage ratio to average consolidated assets of 4%. Under these rules, in order to avoid certain limitations on capital distributions, including dividend payments and certain discretionary bonus payments to executive officers, a banking organization must hold a capital conservation buffer composed of common equity Tier 1 capital above its minimum risk-based capital requirements (equal to 2.5% of total risk-weighted assets). The capital conservation buffer is designed to absorb losses during periods of economic stress.

Pursuant to the Economic Growth, Regulatory Relief and Consumer Protection Act ("EGRRCPA"), the FRB adopted a final rule, effective August 31, 2018, amending the Small Bank Holding Company and Savings and Loan Holding Company Policy Statement (the “policy statement”) to increase the consolidated assets threshold to qualify to utilize the provisions of the policy statement from $1 billion to $3 billion. Bank holding companies, such as the Company, are subject to capital adequacy requirements of the FRB; however, bank holding companies which are subject to the policy statement are not subject to compliance with the regulatory capital requirements until they hold $3 billion or more in consolidated total assets. As a consequence, as of December 31, 2018, the Company was not required to comply with the FRB’s regulatory capital requirements until such time that its consolidated total assets equal $3 billion or more or if the FRB determines that the Company is no longer deemed to be a small bank holding company. However, if the Company had been subject to these regulatory capital requirements, it would have exceeded all regulatory requirements.

In August of 2020, the Federal banking agencies adopted the final version of the community bank leverage ratio framework rule (the “CBLR”), implementing two interim final rules adopted in April of 2020. The rule provides an optional, simplified measure of capital adequacy. Under the optional CBLR framework, the CBLR was 8.5% through calendar year 2021 and is 9% thereafter. The rule is applicable to all non-advanced approaches FDIC-supervised institutions with less than $10 billion in total consolidated assets. Banks not electing the CBLR framework will continue to be subject to the generally applicable risk-based capital rule. On April 23, 2026, the US federal banking regulators issued a final rule implementing changes to the CBLR framework intended to encourage additional community banks to opt into the CBLR framework. The final rule, which is effective July 1, 2026, reduces the CBLR requirement from 9% to 8% and extends the grace period for qualifying institutions that fall below the 8% ratio to return to compliance from the current two quarters to four quarters (subject to a limit of eight quarters in the previous five-year period). At the present time, the Company and the Bank do not intend to elect to use the CBLR framework.

Table of Contents

As of March 31, 2026, the Bank’s capital ratios exceeded applicable regulatory requirements. The following table presents the capital ratios for the Bank, compared to the regulatory standards for well-capitalized depository institutions, as of March 31, 2026.

	Actual					Well Capitalized
						Ratio
(in thousands except ratios)	Capital		Ratio			Requirement
Leverage	$	226,932		11.7	%		5.0	%
Common Equity Tier 1	$	226,932		17.8	%		6.5	%
Tier 1 Risk-Based	$	226,932		17.8	%		8.0	%
Total Risk-Based	$	242,835		19.1	%		10.0	%

Table of Contents

ITEM 3. – QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Company believes that there have been no material changes in the quantitative and qualitative disclosures about market risk as of March 31, 2026, from those presented in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2025, which are incorporated by reference herein.

ITEM 4. – CONTROLS AND PROCEDURES

(a) We maintain “disclosure controls and procedures,” as such term is defined in Rule 13a-15(e) under the Securities Exchange Act of 1934 (the “Exchange Act”), that are designed to ensure that information required to be disclosed by us in reports that we file or submit under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in Securities and Exchange Commission rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. In designing and evaluating our disclosure controls and procedures, management recognized that disclosure controls and procedures, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the disclosure controls and procedures are met. Our disclosure controls and procedures have been designed to meet reasonable assurance standards. Additionally, in designing disclosure controls and procedures, our management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible disclosure controls and procedures. The design of any disclosure controls and procedures also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Our Chief Executive Officer (principal executive officer) and Chief Financial Officer (principal financial officer) have concluded that the design and operation of our disclosure controls and procedures are effective as of March 31, 2026. This conclusion is based on an evaluation conducted under the supervision and with the participation of management.

(b) During the quarter ended March 31, 2026, there were no changes in our internal controls over financial reporting that materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.

PART II – OTHER INFORMATION

ITEM 1. – LEGAL PROCEEDINGS

Neither the Company nor the Bank is a party to any material pending legal proceeding, nor is any of their property the subject of any material pending legal proceeding, except ordinary routine litigation arising in the ordinary course of the Bank’s business and incidental to its business, none of which is expected to have a material adverse impact upon the Company’s or the Bank’s business, financial position or results of operations.

ITEM 1A. – RISK FACTORS

We are subject to various risks and uncertainties, which could materially affect our business, results of operations, financial condition, future results, and the trading price of our common stock. There have been no material changes in the risk factors previously disclosed in Part I, Item 1A, “Risk Factors” in our 2025 Form 10-K. These risk factors, as well as our condensed consolidated financial statements and notes thereto and the other information appearing in this Report, should be reviewed carefully for important information regarding risks that affect us.

Table of Contents

ITEM 2. – UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Issuer Purchases of Equity Securities

The Company made the following purchases of its common stock during the three months ended March 31, 2026:

	(a)		(b)		(c)		(d)
Period	Total number of shares purchased		Average price paid per share		Number of shares purchased as part of publicly announced plans or programs		Maximum number of shares that may yet be purchased under the plans or programs(1)
January 1 - January 31, 2026		—		—		—		147,142
February 1 - February 28, 2026		37,265	$	13.88		37,265		109,877
March 1 - March 31, 2026		47,643	$	13.33		47,643		62,234
Total		84,908				84,908

(1)

On March 27, 2024, the Company approved a stock repurchase program effective May 1, 2024. The stock repurchase program, which remains in effect until April 30, 2026 unless terminated sooner, allows for repurchases by the Company in an aggregate amount of no more than 6% of the Company’s 17,144,680 outstanding shares of common stock as of March 21, 2024. This represented total shares of 1,028,680 eligible for repurchase at May 1, 2024. The total number of shares outstanding and shares eligible for repurchase have been adjusted to give retroactive effect to stock dividends and stock splits, including the 5% stock dividend declared on January 22, 2026, payable on March 25, 2026 to shareholders of record as of February 27, 2026.

ITEM 3. – DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. – MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5. – OTHER INFORMATION

During the three months ended March 31, 2026, no director or officer (as defined in Rule 16a-1(f) under the Exchange Act) of the Company adopted, modified, or terminated a “Rule 10b5-1 trading arrangement” or a “non-Rule 10b5-1 trading arrangement” as each term is defined in Item 408(a) of Regulation S-K.

Table of Contents

ITEM 6. – EXHIBITS

Exhibit Number		Description of Document

31.1		Rule 13a — 14(a) Certification of Chief Executive Officer

31.2		Rule 13a — 14(a) Certification of Chief Financial Officer

32.1**		Statement of the Chief Executive Officer under Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. Section 1350)

32.2**		Statement of the Chief Financial Officer under Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. Section 1350)

101		Interactive data files pursuant to Rule 405 of Regulation S-T: (i) the Condensed Consolidated Balance Sheets, (ii) the Condensed Consolidated Statements of Income, (iii) the Condensed Consolidated Statements of Comprehensive Income/Loss, (iv) the Condensed Consolidated Statement of Stockholders’ Equity, (v) the Condensed Consolidated Statements of Cash Flows and (vi) the Notes to Condensed Consolidated Financial Statements. The XBRL instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

104		Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101).

* Management contract or compensatory plan, contract or arrangement.

** In accordance with Item 601(b)(32)(ii) of Regulation S-K and SEC Release No. 34-47986, the certifications furnished in Exhibits 32.1 and 32.2 hereto are deemed to accompany this Form 10-Q and will not be deemed “filed” for purposes of Section 18 of the Exchange Act. Such certifications will not be deemed to be incorporated by reference into any filing under the Securities Act or the Exchange Act.

Table of Contents

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

			FIRST NORTHERN COMMUNITY BANCORP

Date:	May 7, 2026	By:	/s/ Kevin Spink

			Kevin Spink, Executive Vice President / Chief Financial Officer
			(Principal Financial Officer and Duly Authorized Officer)

First Northern Community Bancorp — Quarterly Report (Form 10-Q)

The analytics layer on top of every filing.

Other filings from First Northern Community Bancorp (FNRN)

Frequently asked questions