ChoiceOne Reports Fourth Quarter 2025 Results

Rhea-AI Summary

ChoiceOne (NASDAQ:COFS) reported Q4 2025 net income of $13.9M and full-year 2025 net income of $28.2M. Total assets rose to $4.4B, driven by the March 1, 2025 merger that added ~$1.8B assets, $1.4B loans and $1.4B deposits.

Diluted EPS was $0.92 for Q4 and $2.01 for 2025; EPS excluding merger items was $3.68 for the year. Asset quality remained strong with nonperforming loans at 0.98% and allowance for credit losses at 1.18%.

Positive

• Total assets increased by $1.7B to $4.4B
• Merger added approximately $1.4B in loans and deposits
• Organic core loan growth of $86.1M (5.7%) in 2025
• Q4 net income of $13.9M; year net income $28.2M
• Diluted EPS excluding merger items of $3.68 for 2025

Negative

• Merger-related expenses, net of tax, of $13.9M for 2025
• Merger-related provision for credit losses, net of tax, of $9.5M
• Noninterest expense increased by $54.0M year-to-date due to merger
• Nonperforming loans rose to 0.98% of loans

Key Figures

Q4 2025 net income: $13,867,000 FY 2025 net income: $28,176,000 Q4 2025 diluted EPS: $0.92 +5 more

8 metrics

Q4 2025 net income $13,867,000 Three months ended December 31, 2025

FY 2025 net income $28,176,000 Year ended December 31, 2025

Q4 2025 diluted EPS $0.92 Three months ended December 31, 2025 vs $0.79 prior year

FY 2025 diluted EPS $2.01 Year ended December 31, 2025 vs $3.25 prior year

Merger assets acquired $1.8 billion Total assets acquired in March 1, 2025 Merger

Merger expenses after tax $13.9 million Merger-related expenses net of taxes, FY 2025

Core loan organic growth $86.1 million (5.7%) Organic core loan growth during 12 months ended December 31, 2025

Nonperforming loans ratio 0.98% Nonperforming loans to total loans as of December 31, 2025

Market Reality Check

Price: $28.69 Vol: Volume 69,482 is slightly...

normal vol

$28.69 Last Close

Volume Volume 69,482 is slightly below 20-day average 77,674 (relative volume 0.89). normal

Technical Trading modestly above 200-day MA, at $29.56 vs 200-day MA $29.35.

Peers on Argus

COFS was up 3.72% with several regional bank peers also positive (e.g., ACNB +1....

COFS was up 3.72% with several regional bank peers also positive (e.g., ACNB +1.44%, FBIZ +2.44%, NFBK +2.19%), but scanner data does not flag a coordinated sector momentum move.

Previous Earnings Reports

5 past events · Latest: Oct 24 (Positive)

Same Type Pattern 5 events

Date	Event	Sentiment	Move	Catalyst
Oct 24	Q3 2025 earnings	Positive	+11.5%	Strong Q3 2025 net income and post‑merger balance sheet expansion.
Jul 25	Q2 2025 earnings	Positive	+4.6%	Robust Q2 2025 earnings and higher net interest margin after merger.
Apr 30	Q1 2025 earnings	Neutral	+1.0%	Merger-related loss but improved margin and strong core loan growth.
Oct 23	Q3 2024 earnings	Positive	+9.1%	Q3 2024 earnings growth, strong loan and deposit growth, higher NIM.
Jul 25	Q2 2024 earnings	Positive	-14.1%	Q2 2024 earnings growth and NIM improvement but negative price reaction.

Pattern Detected

Earnings releases have generally coincided with positive share-price moves, with 4 of the last 5 tagged earnings events showing gains.

Recent Company History

Over the past five earnings cycles, COFS has transitioned from pre‑merger growth to post‑merger scale. Results in 2024 showed steady loan and deposit growth and improving net interest margin. In Q1 2025, the Fentura merger drove a temporary GAAP loss, but subsequent quarters (Q2–Q3 2025) highlighted stronger net income and higher margins on a larger balance sheet. The current Q4/2025 and full‑year 2025 release continues this post‑merger narrative of higher assets, robust core loan growth, and solid capital levels.

Historical Comparison

earnings

+8.1 %

Average Historical Move

Historical Analysis

In the past five earnings releases, COFS saw an average move of about 8.05%, with most reports tied to improving margins and post‑merger growth.

Typical Pattern

Earnings history shows a progression from organic growth in 2024 to a merger-driven balance sheet step‑up in 2025, followed by improving profitability and margins across subsequent quarters.

Market Pulse Summary

This announcement details Q4 and full‑year 2025 results following the Fentura merger, highlighting n...

Analysis

This announcement details Q4 and full‑year 2025 results following the Fentura merger, highlighting net income of $13.9 million for the quarter, assets of $4.4 billion, solid core loan growth, and strong capital ratios. It also notes sizeable merger expenses and a year‑over‑year EPS decline, alongside a modest rise in nonperforming loans. Historically, earnings releases have often coincided with notable price moves, so investors may watch future quarters for expense normalization, credit trends, and sustainability of loan growth.

Key Terms

nonperforming loans, allowance for credit losses, interest rate swaps, pay-fixed interest rate swaps, +4 more

8 terms

nonperforming loans financial

"Nonperforming loans to total loans (excluding loans held for sale) increased to 0.98%..."

Nonperforming loans are loans on which borrowers have stopped making the scheduled interest or principal payments for an extended period (commonly 90 days or more) or are otherwise in serious danger of default. Think of them as IOUs that aren’t being repaid: they tie up a lender’s money, reduce future interest income, and force the lender to hold extra reserves or take losses. For investors, a rising share of nonperforming loans signals weakening credit quality, higher potential losses, and greater risk to a bank’s profitability and capital.

allowance for credit losses financial

"The ratio of the allowance for credit losses to total loans (excluding loans held for sale)..."

Allowance for credit losses is a reserve set aside by a financial institution to cover potential losses from borrowers who may not repay their loans. It acts like a safety net, helping the institution prepare for loans that might turn sour. For investors, it signals how cautious the institution is about the quality of its loans and potential risks to its financial health.

interest rate swaps financial

"ChoiceOne uses interest rate swaps to manage interest rate exposure to certain fixed rate assets..."

A contract between two parties to exchange streams of interest payments, typically swapping a fixed-rate payment for a floating-rate payment or vice versa. Think of it like two neighbors agreeing to trade the type of mortgage payments they make to reduce uncertainty or take advantage of expected rate moves; investors care because swaps change a company’s borrowing costs and risk exposure, which can materially affect cash flow, creditworthiness, and valuation.

pay-fixed interest rate swaps financial

"ChoiceOne entered into $30.4 million in amortizing pay-fixed interest rate swaps to hedge..."

An interest rate swap where one party agrees to make fixed periodic interest payments while receiving payments that vary with market rates; the buyer “pays fixed” and earns a floating rate. Think of it as trading a steady mortgage payment for a bank account that moves with the market. Investors use pay-fixed swaps to lock in borrowing costs or to hedge against rising rates, and traders use them to speculate on rate moves.

GAAP net interest margin financial

"Interest income due to accretion from purchased loans increased GAAP net interest margin by 29..."

GAAP net interest margin measures the profit a bank or lending firm makes from its core lending and borrowing activities, expressed as a percentage of the assets that earn interest. Calculated using standard accounting rules (GAAP), it is like the yield a store gets on the goods it sells: higher margins mean the firm earns more from each dollar of loans or interest-earning assets, so investors use it to judge lending efficiency and interest-rate exposure.

brokered deposits financial

"Deposits, excluding brokered deposits, increased by $760,000 as of December 31, 2025..."

Brokered deposits are large sums of customer cash placed at a bank through a third-party intermediary that shops around for the best interest rate, like a broker assembling a big bucket of savings and directing it to a bank. They matter to investors because they can quickly change a bank’s funding level and cost — providing fast liquidity but also adding volatility and regulatory scrutiny that can affect a bank’s stability and profitability.

FHLB financial

"As of December 31, 2025, the total balance of borrowed funds from the FHLB was $265.0 million..."

The Federal Home Loan Bank (FHLB) system is a group of regional cooperative banks that lend money to local lenders like banks and credit unions so they can fund mortgages and other loans. Think of it as a central ATM for member lenders: when they need short-term cash or a safe place to park collateral, they borrow from the FHLB, and changes in FHLB lending and collateral rules can signal or affect liquidity, funding costs, and credit availability in the housing and banking markets—information investors use to gauge financial stability and interest-rate sensitivity.

accumulated other comprehensive loss financial

"Additional growth of $2.1 million is the result of improvement to accumulated other comprehensive loss..."

Accumulated other comprehensive loss is the running negative total of certain gains and losses that companies record outside their regular profit-and-loss statement, such as changes in the value of some investments, pension adjustments, or currency translation effects. It matters to investors because it reduces shareholders’ equity and reveals economic swings that haven’t affected reported net income yet — like a side ledger showing pending ups and downs that could influence future cash flow or balance-sheet strength.

AI-generated analysis. Not financial advice.

SPARTA, Mich., Jan. 30, 2026 /PRNewswire/ -- ChoiceOne Financial Services, Inc. ("ChoiceOne", NASDAQ:COFS), the parent company for ChoiceOne Bank, reported financial results for the quarter ended December 31, 2025. 

Significant items impacting comparable periods of 2024 and 2025 results include the following:

• On March 1, 2025, ChoiceOne completed the merger (the "Merger") of Fentura Financial, Inc. ("Fentura"), the former parent company of The State Bank, with and into ChoiceOne with ChoiceOne surviving the merger. On March 14, 2025, the consolidation of The State Bank with and into ChoiceOne Bank with ChoiceOne Bank surviving the consolidation was completed.
• The total assets, loans and deposits acquired in the Merger were approximately $1.8 billion, $1.4 billion and $1.4 billion, respectively.
• Merger related expenses, net of taxes, of $13.9 million or $0.99 per diluted share for the year ended December 31, 2025. There were no merger expenses in the fourth quarter of 2025 and management does not anticipate additional material merger expenses.
• Merger related provision for credit losses, net of taxes, of $9.5 million during the first quarter ended March 31, 2025, or $0.68 per diluted share for the year ended December 31, 2025.

Highlights

• ChoiceOne reported net income of $13,867,000 and $28,176,000 for the three months ended and year ended December 31, 2025, compared to net income of $7,159,000 and $26,727,000 for the same periods in the prior year, respectively. Net income excluding merger expenses, net of taxes, and merger related provision for credit losses, net of taxes, was $13,867,000 and $51,524,000 for the three months ended and year ended December 31, 2025, respectively.
• Diluted earnings per share were $0.92 and $2.01 for the three months ended and year ended December 31, 2025, compared to diluted earnings per share of $0.79 and $3.25 in the same periods in the prior year. Diluted earnings per share excluding merger expenses, net of taxes, and merger related provision for credit losses, net of taxes, were $0.92 and $3.68 for the three months ended and year ended December 31, 2025.
• Core loans, which exclude held for sale loans and loans to other financial institutions, increased by $55.6 million or 7.6% on an annualized basis during the fourth quarter of 2025 and grew organically by $86.1 million or 5.7% during the twelve months ended December 31, 2025. Core loans also grew by $1.4 billion due to the Merger on March 1, 2025.
• Asset quality continues to remain strong, with annualized net loan charge-offs to average loans of 0.04%. Nonperforming loans to total loans (excluding loans held for sale) increased to 0.98% as of December 31, 2025 compared to 0.69% as of September 30, 2025. Notably, 0.63% of the nonperforming loans to total loans (excluding loans held for sale) is attributed to certain purchased loans which were identified prior to the Merger as having credit deterioration. Importantly, we believe this uptick is not indicative of a broader trend, and current portfolio performance does not suggest emerging weakness in underlying credit quality.

"2025 was a landmark year for ChoiceOne—not only because of the successful merger with Fentura and its subsidiary, The State Bank, but also due to our strong financial performance. These accomplishments are a direct result of the hard work and dedication of our exceptional team, whose efforts truly shined throughout the year" said Kelly Potes, Chief Executive Officer.

ChoiceOne reported net income of $13,867,000 and $28,176,000 for the three months ended and year ended December 31, 2025, compared to net income of $7,159,000 and $26,727,000 for the same periods in the prior year, respectively.  Net income excluding merger expenses, net of taxes, and merger related provision for credit losses, net of taxes, was $13,867,000 and $51,524,000 for the three months ended and year ended December 31, 2025, respectively.  Diluted earnings per share were $0.92 and $2.01 for the three months ended and year ended December 31, 2025, compared to diluted earnings per share of $0.79 and $3.25 in the same periods in the prior year.  Diluted earnings per share excluding merger expenses, net of taxes, and merger related provision for credit losses, net of taxes, were $0.92 and $3.68 for the three months ended and year ended December 31, 2025.

As of December 31, 2025, total assets were $4.4 billion, an increase of $1.7 billion compared to December 31, 2024.  The growth in total assets is primarily attributed to the Merger.  In addition to growth related to the Merger, ChoiceOne also grew in core loans, securities and loans to other financial institutions, which consist of a warehouse line of credit used to facilitate mortgage loan originations.  Interest rates and balances from this warehouse line of credit fluctuate with the national mortgage market and are short term in nature. 

Core loans, which exclude held for sale loans and loans to other financial institutions, increased by $55.6 million or 7.6% on an annualized basis during the fourth quarter of 2025 and grew organically by $86.1 million or 5.7% during the twelve months ended December 31, 2025.  Core loans also grew by $1.4 billion due to the Merger on March 1, 2025.  Loan interest income increased $23.0 million in the fourth quarter of 2025 compared to the same period in 2024 and decreased $506,000 compared to the third quarter of 2025.  The decrease from the third quarter is due to rate reductions in PRIME rate loans which are tied to changes in the federal funds rate and a decrease in interest income due to accretion from purchased loans.  Interest income for the three months ended December 31, 2025, includes $3.1 million of interest income due to accretion from purchased loans compared to $3.6 million for the three months ended September 30, 2025.  Interest income due to accretion from purchased loans increased GAAP net interest margin by 29 and 36 basis points in the fourth and third quarter of 2025, respectively.  Of this amount, $2.3 million was calculated using the effective interest rate method of amortization, while the remaining $635,000 resulted from accretion through unexpected payoffs and paydowns of loans with an associated fair value mark.  Estimated interest income due to accretion from purchased loans for 2026 using the effective interest method of amortization is $8.0 million; however, actual results will be dependent on prepayment speeds and other factors.  It is estimated that a total of $53.1 million remains to be recognized as interest income due to accretion from purchased loans over the life of the loan portfolio.

Deposits, excluding brokered deposits, increased by $760,000 as of December 31, 2025, compared to September 30, 2025.  Deposits, excluding brokered deposits, increased by $1.3 billion as of December 31, 2025, compared to December 31, 2024 largely as a result of the Merger.  ChoiceOne continues to be proactive in managing its liquidity position by using brokered deposits and short term FHLB advances to ensure ample liquidity.  As of December 31, 2025, the total balance of borrowed funds from the FHLB was $265.0 million at a weighted average rate of 3.83%, with $245.0 million due within 12 months.  At December 31, 2025, total available borrowing capacity secured by pledged assets was $1.1 billion. ChoiceOne can increase its borrowing capacity by utilizing unsecured federal fund lines and pledging additional assets.  Uninsured deposits totaled $1.2 billion or 33.2% of deposits at December 31, 2025.

In the three months ended December 31, 2025, ChoiceOne's annualized cost of deposits to average total deposits remained flat compared to the three months ended September 30, 2025 and was down one basis point compared to the three months ended December 31, 2024, despite the higher-cost deposits acquired through the Merger.  The annualized cost of funds decreased by 11 basis points, from 1.90% to 1.79% in the three months ended December 31, 2025 compared to the same period in the prior year, primarily due to a decrease in higher cost local and brokered CDs.  Interest expense on borrowings for the three months ended December 31, 2025, increased by $289,000 compared to the same period in the prior year, due to a $58.2 million increase in the average balance borrowed offset by a  reduction in rates.  In the three months ended December 31, 2025, compared to the three months ended September 30, 2025, annualized cost of funds increased 2 basis points from 1.77% to 1.79% despite reductions in federal funds rates during the fourth quarter.  This is due to the timing of reductions to customer rates later in the fourth quarter, increased competition for deposits, and the reduction of cash flow on pay-fixed swaps tied to interest bearing deposits which offset interest expense.  With ChoiceOne's already low cost of deposits and market conditions, further reductions in federal funds rates may not immediately offset with savings on reductions in deposits and short term borrowings.

The provision for credit losses on loans was $1.1 million in the fourth quarter of 2025, due to $112.1 million of loan growth in the portfolio, excluding loans held for sale, and $305,000 in net charge offs.  The ratio of the allowance for credit losses to total loans (excluding loans held for sale) was 1.18% on December 31, 2025 compared to 1.19% on September 30, 2025, and 1.07% on December 31, 2024.  Asset quality continues to remain strong, with annualized net loan charge-offs to average loans of 0.04%.  Nonperforming loans to total loans (excluding loans held for sale) increased to 0.98% as of December 31, 2025 compared to 0.69% as of September 30, 2025. Notably, 0.63% of the nonperforming loans to total loans (excluding loans held for sale) is attributed to certain purchased loans which were identified prior to the Merger as having  credit deterioration.  Importantly, we believe this uptick is not indicative of a broader trend, and current portfolio performance does not suggest emerging weakness in underlying credit quality.

ChoiceOne uses interest rate swaps to manage interest rate exposure to certain fixed rate assets and variable rate liabilities.  During the third quarter of 2025, ChoiceOne entered into $30.4 million in amortizing pay-fixed interest rate swaps to hedge interest rate risk on approximately $40.6 million of newly purchased agency mortgage backed securities.   The interest rate swaps are designed to amortize with the expected cash flow of the bonds and hold a coupon of 3.52% and a contractual term ending in 2040.  On December 31, 2025, ChoiceOne held pay-fixed interest rate swaps with a total notional value of $380.4 million, a weighted average coupon of 3.15%, a fair value of $8.4 million and an average remaining contract length of 7.0 years.  Settlements from interest rate swaps amounted to $955,000 for the fourth quarter of 2025 compared to $1.3 million for the third quarter of 2025.  In addition to the pay-fixed interest rate swaps, ChoiceOne also employs back-to-back swaps on select commercial loans, with the impact reflected in interest income.  In January 2026, ChoiceOne exited $201.0 million of pay‑fixed interest rate swaps with a coupon of 3.4%, realizing a small gain, that will be applied to the basis of the hedged bonds.  After evaluating multiple rate scenarios, we determined that our interest rate risk profile and overall balance‑sheet flexibility are improved without the pay‑fixed interest rate swaps, and we believe this action better aligns our interest‑rate posture with long‑term value creation for shareholders.  Following this exit, ChoiceOne has approximately $180 million of pay-fixed interest rate swaps with a weighted average coupon of 2.88%.

As of December 31, 2025, shareholders' equity was $465.4 million, a significant increase from $260.4 million on December 31, 2024. This growth was primarily driven by the Merger, in which ChoiceOne issued 6,070,836 shares of common stock on March 1, 2025, valued at $193.0 million. Additional growth of $2.1 million is the result of improvement to accumulated other comprehensive loss during the year.  ChoiceOne also repurchased 25,116 shares of stock for a net cost of $775,000 under our existing share repurchase plan.  The repurchase plan has 350,272 shares remaining to purchase as of December 31, 2025.  The repurchase reflects our view that our capital position is healthy and the repurchase of shares is in the best interest of our shareholders.  ChoiceOne Bank continues to be "well-capitalized," with a total risk-based capital ratio of 12.5% as of December 31, 2025, compared to 12.7% on December 31, 2024.

Noninterest income increased by $1.1 million and $6.7 million for the three months ended and year ended December 31, 2025, compared to the same periods in the prior year. This increase was partly driven by higher interchange income, which rose due to increased volume from the Merger.  Trust income as well as insurance and investment commissions income also increased as a result of higher estate settlement fees and customers obtained from the Merger.  These increases were offset by a decline in gains on sales of loans and losses on sales and write downs of other assets.  Gains on sales of loans declined as the bank maintained conservative underwriting and chose not to pursue certain loan sale opportunities that did not meet our pricing or credit risk standards.  Noninterest income decreased $1.0 million in the fourth quarter of 2025 compared to the third quarter 2025 due primarily to losses on sales of other assets of $161,000 and unrealized losses on market value of equity securities of $655,000.

Noninterest expense increased by $10.0 million and $54.0 million for the three months ended and year ended December 31, 2025, compared to the same periods in 2024. The increase in 2025 was largely due to merger-related expenses of $17.4 million during 2025, compared to $1.0 million in the same period in the prior year.  Management does not anticipate additional  material merger expenses.  The remainder of the increase was primarily due to the addition of Fentura on March 1, 2025.  Noninterest expense decreased by $866,000 in the fourth quarter of 2025 compared to the third quarter of 2025 due to decreases in collections and fraud expenses and other operational expenses which were partially offset by an increase in salaries and benefits.  ChoiceOne will continue to invest in its talented staff, technology and footprint while prioritizing operational efficiency and disciplined investment. ChoiceOne has secured a location in Troy, MI and expects to open a full service branch and lending office later in 2026.  We believe this new office will help us continue our strong growth in an attractive market.  In addition, we are experimenting with automation and AI‑driven solutions designed to modernize processes to augment the ability for our existing staff to manage our growth.

ChoiceOne's fourth‑quarter 2025 tax expense was reduced by $340,000 as a result of purchasing a transferable tax credit that will be applied to 2025 income taxes, with allowable carrybacks to prior years. Management is continuing to evaluate additional transferable tax credit opportunities and may pursue further purchases to help offset tax expense in 2026.

"We closed the year with solid capital and liquidity and an efficient funding mix, keeping us well‑positioned to support clients and create long‑term value" said Kelly Potes, Chief Executive Officer.  "As we move into 2026, we do so with strong organic growth momentum across our markets and a renewed focus on strengthening our customer relationships. I am grateful to our employees, Board of Directors, and shareholders for their continued support of our vision to be the Best Bank in Michigan"

About ChoiceOne

ChoiceOne Financial Services, Inc. is a financial holding company headquartered in Sparta, Michigan, with assets over $4 billion, and the parent corporation of ChoiceOne Bank. Member FDIC. ChoiceOne Bank operates 56 offices in West, Central and Southeast Michigan. ChoiceOne Bank offers insurance and investment products through its subsidiary, ChoiceOne Insurance Agencies, Inc. ChoiceOne Financial Services, Inc. common stock is quoted on the Nasdaq Capital Market under the symbol "COFS." For more information, please visit Investor Relations at ChoiceOne's website choiceone.bank.

Forward-Looking Statements

This press release contains forward-looking statements.  Words such as "anticipates," "believes," "estimates," "expects," "forecasts," "intends," "is likely," "plans," "predicts," "projects," "may," "could," "look forward," "continue", "future", "view" and variations of such words and similar expressions are intended to identify such forward-looking statements.   These statements reflect current beliefs as to the expected outcomes of future events and are not guarantees of future performance.  These statements involve certain risks, uncertainties and assumptions ("risk factors") that are difficult to predict with regard to timing, extent, likelihood and degree of occurrence.  Therefore, actual results and outcomes may materially differ from what may be expressed, implied or forecasted in such forward-looking statements. Furthermore, ChoiceOne does not undertake any obligation to update, amend, or clarify forward-looking statements, whether as a result of new information, future events, or otherwise. 

Risk factors include, but are not limited to, the risk factors described in Item 1A in ChoiceOne's Annual Report on Form 10-K for the year ended December 31, 2024 and in any of ChoiceOne's subsequent SEC filings, which are available on the SEC's website, www.sec.gov.

Non-GAAP Financial Measures

In addition to results presented in accordance with GAAP, this press release includes certain non-GAAP financial measures. ChoiceOne believes these non-GAAP financial measures provide additional information that is useful to investors in helping to understand underlying financial performance and condition and trends of ChoiceOne.

Non-GAAP financial measures have inherent limitations. Readers should be aware of these limitations and should be cautious with respect to the use of such measures. To compensate for these limitations, non-GAAP measures are used as comparative tools, together with GAAP measures, to assist in the evaluation of operating performance or financial condition. These measures are also calculated using the appropriate GAAP or regulatory components in their entirety and are computed in a manner intended to facilitate consistent period-to-period comparisons. ChoiceOne's method of calculating these non-GAAP measures may differ from methods used by other companies. These non-GAAP measures should not be considered in isolation or as a substitute for those financial measures prepared in accordance with GAAP or in-effect regulatory requirements.

Where non-GAAP financial measures are used, the most directly comparable GAAP or regulatory financial measure, as well as the reconciliation to the most directly comparable GAAP or regulatory financial measure, can be found in the tables to this press release under the heading non-GAAP reconciliation.

 

Condensed Balance Sheets (Unaudited)
(In thousands)		December 31, 2025				September 30, 2025				December 31, 2024
Cash and cash equivalents		$	87,988			$	98,978			$	96,751
Equity securities, at fair value			9,353				9,505				7,782
Securities Held to Maturity			385,193				388,517				394,534
Securities Available for Sale			554,420				544,023				479,117
Federal Home Loan Bank stock			18,562				18,562				9,383
Federal Reserve Bank stock			12,554				12,554				5,307
Loans held for sale			7,185				6,323				7,288
Loans to other financial institutions			58,987				2,483				39,878
Core loans			2,963,047				2,907,445				1,505,762
Total loans held for investment			3,022,034				2,909,928				1,545,640
Allowance for credit losses			(35,550)				(34,754)				(16,552)
Loans, net of allowance for credit losses			2,986,484				2,875,174				1,529,088
Premises and equipment			48,110				46,159				27,099
Cash surrender value of life insurance policies			74,798				74,231				44,896
Goodwill			129,854				126,730				59,946
Intangible assets			31,149				31,694				1,096
Other assets			64,901				64,452				60,956
Total Assets		$	4,410,551			$	4,296,902			$	2,723,243
Noninterest-bearing deposits		$	907,007			$	903,925			$	524,945
Interest-bearing demand deposits			1,364,887				1,395,724				920,167
Savings deposits			607,045				588,798				338,109
Certificates of deposit			616,180				605,912				394,371
Brokered deposits			104,906				72,672				36,511
Borrowings			264,788				197,752				175,000
Subordinated debentures			48,460				48,368				35,752
Other liabilities			31,925				34,136				37,973
Total Liabilities			3,945,198				3,847,287				2,462,828
Common stock and paid-in capital, no par value; shares authorized: 30,000,000; shares outstanding: 15,000,939 at December 31, 2025, 15,017,802 at September 30, 2025,  and 8,965,483 at December 31, 2024.			398,386				398,688				206,780
Retained earnings			102,641				93,124				91,414
Accumulated other comprehensive income (loss), net			(35,674)				(42,197)				(37,779)
Shareholders' Equity			465,353				449,615				260,415
Total Liabilities and Shareholders' Equity		$	4,410,551			$	4,296,902			$	2,723,243

 

Condensed Statements of Operations (Unaudited)
		Three Months Ended				Three Months Ended				Three Months Ended				Twelve Months Ended
(Dollars in thousands, except per share data)		December 31,				September 30,				December 31,				December 31,
		2025				2025				2024				2025				2024
Interest income
Loans, including fees		$	46,617			$	47,123			$	23,571			$	172,914			$	89,580
Securities:
Taxable			5,663				5,249				4,846				20,906				21,228
Tax exempt			1,402				1,418				1,390				5,622				5,614
Other			694				908				1,231				3,516				4,682
Total interest income			54,376				54,698				31,038				202,958				121,104
Interest expense
Deposits			14,127				14,287				8,710				53,970				34,174
Advances from Federal Home Loan Bank			2,564				1,926				669				8,201				2,041
Other			845				888				2,310				3,717				10,447
Total interest expense			17,536				17,101				11,689				65,888				46,662
Net interest income			36,840				37,597				19,349				137,070				74,442
Provision for credit losses on loans			1,100				200				200				15,113				1,300
Provision for (reversal of) credit losses on unfunded commitments			(300)				-				-				(300)				(675)
Net Provision for credit losses expense			800				200				200				14,813				625
Net interest income after provision			36,040				37,397				19,149				122,257				73,817
Noninterest income
Customer service charges			1,683				1,729				1,237				5,994				4,774
Interchange income			2,086				2,133				1,494				7,811				5,797
Insurance and investment commissions			592				485				170				1,912				742
Gains on sales of loans			511				671				829				1,981				2,439
Net gains (losses) on sales and write downs of other assets			(200)				(39)				(5)				(226)				198
Earnings on life insurance policies			567				558				819				2,358				1,934
Trust income			689				734				241				2,525				906
Change in market value of equity securities			(197)				458				(46)				607				195
Other			366				415				255				1,704				1,010
Total noninterest income			6,097				7,144				4,994				24,666				17,995
Noninterest expense
Salaries and benefits			14,559				14,127				8,941				52,737				33,408
Occupancy and equipment			2,469				2,694				1,383				9,314				5,797
Data processing			2,374				2,499				1,499				9,311				5,905
Communication			576				517				341				2,034				1,317
Professional fees			784				834				653				3,262				2,471
Supplies and postage			291				267				179				1,107				699
Advertising and promotional			258				207				271				981				788
Intangible amortization			1,683				1,728				153				5,823				757
FDIC insurance			475				530				180				2,010				1,335
Merger related expenses			-				-				394				17,369				1,039
Other			1,880				2,812				1,350				8,787				5,207
Total noninterest expense			25,349				26,215				15,344				112,735				58,723
Income (loss) before income tax			16,788				18,326				8,799				34,188				33,089
Income tax expense (benefit)			2,921				3,645				1,640				6,012				6,362
Net income (loss)		$	13,867			$	14,681			$	7,159			$	28,176			$	26,727
Basic earnings (loss) per share		$	0.92			$	0.98			$	0.79			$	2.02			$	3.27
Diluted earnings (loss) per share		$	0.92			$	0.97			$	0.79			$	2.01			$	3.25
Dividends declared per share		$	0.29			$	0.28			$	0.28			$	1.13			$	1.09

 

Table 1 - Average Balances and tax-Equivalent Interest Rates (Unaudited)
	Three Months Ended December 31, 2025												Three Months Ended September 30, 2025												Three Months Ended December 31, 2024
(Dollars in thousands)	Average												Average												Average
	Balance				Interest				Rate				Balance				Interest				Rate				Balance				Interest				Rate
Assets:
Loans (1)(3)(4)(5)	$	2,961,133				46,635				6.25		%	$	2,927,878			$	47,142				6.39		%	$	1,516,466			$	23,591				6.19		%
Taxable securities (2)		750,256				5,663				2.99				703,045				5,249				2.96				677,133				4,846				2.85
Nontaxable securities (1)		285,782				1,776				2.47				287,274				1,795				2.48				288,368				1,760				2.43
Other		69,056				694				3.99				79,365				909				4.54				100,864				1,231				4.86
Interest-earning assets		4,066,227				54,768				5.34				3,997,562				55,095				5.47				2,582,831				31,428				4.84
Noninterest-earning assets		309,300												310,727												136,699
Total assets	$	4,375,527											$	4,308,289											$	2,719,530
Liabilities and Shareholders' Equity:
Interest-bearing demand deposits	$	1,343,600			$	6,352				1.88		%	$	1,374,827			$	6,392				1.84		%	$	907,631			$	3,389				1.49		%
Savings deposits		596,010				1,252				0.83				591,653				1,125				0.75				336,107				810				0.96
Certificates of deposit		613,387				5,502				3.56				616,686				5,777				3.72				397,364				4,291				4.30
Brokered deposit		100,133				1,021				4.05				91,735				993				4.30				19,620				220				4.46
Borrowings		255,978				2,663				4.13				179,122				2,019				4.47				197,828				2,374				4.77
Subordinated debentures		48,411			681					5.58				48,663				701				5.72				35,719				405				4.51
Other		6,311			65					4.09				8,550				94				4.38				16,928				200				4.70
Interest-bearing liabilities		2,963,830				17,536				2.35				2,911,236				17,101				2.33				1,911,197				11,689				2.43
Demand deposits		925,414												930,346												536,653
Other noninterest-bearing liabilities		26,860												28,258												16,943
Total liabilities		3,916,104												3,869,840												2,464,793
Shareholders' equity		459,423												438,449												254,737
Total liabilities and shareholders' equity	$	4,375,527											$	4,308,289											$	2,719,530
Net interest income (tax- equivalent basis) (Non-GAAP) (1)					$	37,232											$	37,994											$	19,739
Net interest margin (tax- equivalent basis) (Non-GAAP) (1)										3.63		%										3.77		%										3.04		%

(1)	Adjusted to a fully tax-equivalent basis to facilitate comparison to the taxable interest-earning assets. The adjustment uses an incremental tax rate of 21%.  The presentation of these measures on a tax-equivalent basis is not in accordance with GAAP, but is customary in the banking industry.  These non-GAAP measures ensure comparability with respect to both taxable and tax-exempt loans and securities.
(2)	Taxable securities include dividend income from Federal Home Loan Bank and Federal Reserve Bank stock.
(3)	Loans include both loans to other financial institutions and loans held for sale.
(4)	Non-accruing loan balances are included in the balances of average loans.  Non-accruing loan average balances were $22.2 million, $17.1 million, and 3.0 million in the fourth quarter of 2025, the third quarter of 2025 and the fourth quarter of 2024, respectively.
(5)	Interest on loans included net origination fees and interest income due to accretion from purchased loans.  Interest income due to accretion from purchased loans was $3.1 million, $3.6 million and $276,000 in the fourth quarter of 2025, the third quarter of 2025 and the fourth quarter of 2024, respectively.

 

Income Adjusted for Merger Expenses - Non-GAAP Reconciliation (Unaudited)
		Three Months Ended				Three Months Ended				Three Months Ended				Twelve Months Ended
		December 31,				September 30,				December 31,				December 31,
		2025				2025				2024				2025				2024
(In Thousands, Except Per Share Data)
Net income (loss)		$	13,867			$	14,681			$	7,159			$	28,176			$	26,727
Merger related expenses net of tax			-				-				373				13,885				1,006
Merger related provision for credit losses, net of tax (1)			-				-				-				9,463				-
Adjusted net income		$	13,867			$	14,681			$	7,532			$	51,524			$	27,733
Weighted average number of shares			15,015,486				15,014,933				8,963,258				13,941,260				8,166,472
Diluted average shares outstanding			15,065,937				15,061,155				9,024,567				13,992,099				8,221,065
Basic earnings (loss) per share		$	0.92			$	0.98			$	0.79			$	2.02			$	3.27
Diluted earnings (loss) per share		$	0.92			$	0.97			$	0.79			$	2.01			$	3.25
Adjusted basic earnings per share		$	0.92			$	0.98			$	0.84			$	3.70			$	3.40
Adjusted diluted earnings per share		$	0.92			$	0.97			$	0.83			$	3.68			$	3.37

(1) Merger related provision for credit loss represents the calculated credit loss on Non-PCD loans acquired during the Merger on March 1, 2025.

 

Other Selected Financial Highlights (Unaudited)
		Quarterly
Earnings		2025 4th Qtr.				2025 3rd Qtr.				2025 2nd Qtr.				2025 1st Qtr.				2024 4th Qtr.
(in thousands except per share data)
Net interest income		$	36,840			$	37,597			$	36,322			$	26,311			$	19,349
Net provision expense			800				200				650				13,163				200
Noninterest income			6,097				7,144				6,503				4,922				4,994
Noninterest expense			25,349				26,215				25,506				35,665				15,344
Net income (loss) before federal income tax expense			16,788				18,326				16,669				(17,595)				8,799
Income tax expense (benefit)			2,921				3,645				3,135				(3,689)				1,640
Net income (loss)			13,867				14,681				13,534				(13,906)				7,159
Basic earnings (loss) per share			0.92				0.98				0.90				(1.30)				0.79
Diluted earnings (loss) per share			0.92				0.97				0.90				(1.29)				0.79
Adjusted basic earnings per share (non-GAAP)			0.92				0.98				0.91				0.87				0.84
Adjusted diluted earnings per share (non-GAAP)			0.92				0.97				0.91				0.86				0.83

 

End of period balances		2025 4th Qtr.				2025 3rd Qtr.				2025 2nd Qtr.				2025 1st Qtr.				2024 4th Qtr.
(in thousands)
Gross loans		$	3,029,219			$	2,916,251			$	2,928,431			$	2,928,896			$	1,552,928
Loans held for sale (1)			7,185				6,323				7,639				3,941				7,288
Loans to other financial institutions (2)			58,987				2,483				3,033				2,393				39,878
Core loans (gross loans excluding 1 and 2 above)			2,963,047				2,907,445				2,917,759				2,922,562				1,505,762
Allowance for credit losses			35,550				34,754				34,798				34,567				16,552
Securities available for sale			554,420				544,023				479,426				480,650				479,117
Securities held to maturity			385,193				388,517				390,457				394,434				394,534
Other interest-earning assets			74,857				79,677				110,206				110,605				86,185
Total earning assets (before allowance)			4,043,689				3,928,468				3,908,520				3,914,585				2,512,764
Total assets			4,410,551				4,296,902				4,310,252				4,305,391				2,723,243
Noninterest-bearing deposits			907,007				903,925				943,873				912,033				524,945
Interest-bearing demand deposits			1,364,887				1,395,724				1,322,336				1,406,660				920,167
Savings deposits			607,045				588,798				595,981				602,337				338,109
Certificates of deposit			616,180				605,912				624,209				663,404				394,371
Brokered deposits			104,906				72,672				106,225				67,295				36,511
Total deposits			3,600,025				3,567,031				3,592,624				3,651,729				2,214,103
Deposits excluding brokered			3,495,119				3,494,359				3,486,399				3,584,434				2,177,592
Total subordinated debt			48,460				48,368				48,277				48,186				35,752
Total borrowed funds			264,788				197,752				198,428				137,330				175,000
Other interest-bearing liabilities			7,689				7,695				8,529				13,420				24,003
Total interest-bearing liabilities			3,013,955				2,916,921				2,903,985				2,938,632				1,923,913
Shareholders' equity			465,353				449,615				431,761				427,068				260,415

 

Average Balances		2025 4th Qtr.				2025 3rd Qtr.				2025 2nd Qtr.				2025 1st Qtr.				2024 4th Qtr.
(in thousands)
Loans		$	2,961,133			$	2,927,878			$	2,936,168			$	2,019,643			$	1,516,466
Securities			1,036,038				990,319				984,607				978,769				965,501
Other interest-earning assets			69,056				79,365				63,416				115,091				100,864
Total earning assets (before allowance)			4,066,227				3,997,562				3,984,191				3,113,503				2,582,831
Total assets			4,375,527				4,308,289				4,298,513				3,319,591				2,719,530
Noninterest-bearing deposits			925,414				930,346				915,637				651,424				536,653
Interest-bearing deposits			2,552,997				2,583,166				2,573,927				2,030,543				1,641,102
Brokered deposits			100,133				91,735				120,720				45,553				19,620
Total deposits			3,578,544				3,605,247				3,610,284				2,727,520				2,197,375
Total subordinated debt			48,411				48,663				48,971				40,182				35,719
Total borrowed funds			255,978				179,122				169,257				193,961				197,828
Other interest-bearing liabilities			6,311				8,550				11,763				20,553				16,928
Total interest-bearing liabilities			2,963,830				2,911,236				2,924,638				2,330,792				1,911,197
Shareholders' equity			459,423				438,449				427,543				302,537				254,737

 

Loan Breakout (in thousands)		2025 4th Qtr.				2025 3rd Qtr.				2025 2nd Qtr.				2025 1st Qtr.				2024 4th Qtr.
Agricultural		$	56,218			$	51,183			$	47,273			$	48,165			$	48,221
Commercial and Industrial			352,556				352,876				351,367				345,138				228,256
Commercial Real Estate			1,780,396				1,728,774				1,743,541				1,757,599				901,130
Consumer			26,701				27,328				29,741				30,932				29,412
Construction Real Estate			19,139				18,440				21,508				18,067				17,042
Residential Real Estate			728,037				728,844				724,329				722,661				281,701
Loans to Other Financial Institutions			58,987				2,483				3,033				2,393				39,878
Gross Loans (excluding held for sale)		$	3,022,034			$	2,909,928			$	2,920,792			$	2,924,955			$	1,545,640
Allowance for credit losses			35,550				34,754				34,798				34,567				16,552
Net loans		$	2,986,484			$	2,875,174			$	2,885,994			$	2,890,388			$	1,529,088

 

Performance Ratios		2025 4th Qtr.				2025 3rd Qtr.				2025 2nd Qtr.				2025 1st Qtr.				2024 4th Qtr.
Annualized return on average assets			1.27	%			1.36	%			1.26	%			-1.68	%			1.05	%
Annualized return on average equity			12.07	%			13.39	%			12.66	%			-18.39	%			11.24	%
Annualized return on average tangible common equity			16.66	%			19.08	%			18.26	%			-27.97	%			14.54	%
Net interest margin (GAAP)			3.59	%			3.73	%			3.66	%			3.43	%			2.98	%
Net interest margin (fully tax-equivalent)			3.63	%			3.77	%			3.70	%			3.48	%			3.04	%
Efficiency ratio			54.12	%			54.76	%			55.32	%			111.01	%			61.29	%
Annualized cost of funds			1.79	%			1.77	%			1.84	%			1.86	%			1.90	%
Annualized cost of deposits			1.57	%			1.57	%			1.65	%			1.59	%			1.58	%
Cost of interest bearing liabilities			2.35	%			2.33	%			2.41	%			2.37	%			2.43	%
Shareholders' equity to total assets			10.55	%			10.46	%			10.02	%			9.91	%			9.56	%
Tangible common equity to tangible assets			7.16	%			7.04	%			6.54	%			6.40	%			7.49	%
Annualized noninterest expense to average assets			2.32	%			2.43	%			2.37	%			4.30	%			2.26	%
Loan to deposit			84.14	%			81.76	%			81.51	%			80.21	%			70.14	%
Full-time equivalent employees			569				573				571				605				377

 

Capital Ratios ChoiceOne Financial Services Inc.		2025 4th Qtr.				2025 3rd Qtr.				2025 2nd Qtr.				2025 1st Qtr.				2024 4th Qtr.
Total capital (to risk weighted assets)			12.7	%			13.0	%			12.4	%			12.0	%			14.5	%
Common equity Tier 1 capital (to risk weighted assets)			10.2	%			10.3	%			9.8	%			9.4	%			12.0	%
Tier 1 capital (to risk weighted assets)			10.7	%			10.9	%			10.4	%			10.0	%			12.2	%
Tier 1 capital (to average assets)			8.5	%			8.5	%			8.2	%			10.4	%			9.1	%
Tier 1 capital (to total assets)			8.1	%			8.2	%			7.9	%			7.6	%			8.9	%
Commercial Real Estate Loans (non-owner occupied) as a percentage of total capital			279.0	%			275.2	%			288.2	%			302.0	%			195.6	%

 

Capital Ratios ChoiceOne Bank		2025 4th Qtr.				2025 3rd Qtr.				2025 2nd Qtr.				2025 1st Qtr.				2024 4th Qtr.
Total capital (to risk weighted assets)			12.5	%			12.8	%			12.4	%			11.9	%			12.7	%
Common equity Tier 1 capital (to risk weighted assets)			11.4	%			11.7	%			11.3	%			10.9	%			12.0	%
Tier 1 capital (to risk weighted assets)			11.4	%			11.7	%			11.3	%			10.9	%			12.0	%
Tier 1 capital (to average assets)			9.1	%			9.1	%			8.9	%			11.3	%			8.9	%
Tier 1 capital (to total assets)			8.7	%			8.8	%			8.6	%			8.3	%			8.7	%
Commercial Real Estate Loans (non-owner occupied) as a percentage of total capital			284.4	%			280.0	%			290.6	%			303.9	%			224.9	%

 

Asset Quality		2025 4th Qtr.				2025 3rd Qtr.				2025 2nd Qtr.				2025 1st Qtr.				2024 4th Qtr.
(in thousands)
Net loan charge-offs (recoveries)		$	305			$	244			$	418			$	72			$	138
Annualized net loan charge-offs (recoveries) to average loans			0.04	%			0.03	%			0.06	%			0.01	%			0.04	%
Allowance for credit losses		$	35,550			$	34,754			$	34,798			$	34,567			$	16,552
Unfunded commitment liability		$	1,347			$	1,647			$	1,647			$	1,647			$	1,485
Allowance to loans (excludes held for sale)			1.18	%			1.19	%			1.19	%			1.18	%			1.07	%
Total funds reserved to pay for loans (includes liability for unfunded commitments and excludes held for sale)			1.22	%			1.25	%			1.25	%			1.24	%			1.17	%
Non-Accruing loans		$	27,058			$	17,365			$	16,854			$	16,789			$	3,704
Nonperforming loans (includes OREO)		$	29,582			$	19,940			$	19,296			$	19,154			$	4,177
Nonperforming loans to total loans (excludes held for sale)			0.98	%			0.69	%			0.66	%			0.65	%			0.27	%
Non Accrual classified as PCD		$	19,007			$	11,393			$	12,017			$	12,891			$	-
Nonperforming loans to total loans (excludes held for sale) attributed to PCD			0.63	%			0.39	%			0.41	%			0.44	%			-
Nonperforming assets to total assets			0.67	%			0.46	%			0.45	%			0.44	%			0.15	%

 

Other Non-GAAP Reconciliation (Unaudited)
NON-GAAP Reconciliation		2025 4th Qtr.				2025 3rd Qtr.				2025 2nd Qtr.				2025 1st Qtr.				2024 4th Qtr.
Net interest income (tax-equivalent basis) (Non-GAAP)		$	37,232			$	37,994			$	36,711			$	26,710			$	19,739
Net interest margin (fully tax-equivalent)			3.63	%			3.77	%			3.70	%			3.48	%			3.04	%
Reconciliation to Reported Net Interest Income
Net interest income (tax-equivalent basis) (Non-GAAP)		$	37,232			$	37,994			$	36,711			$	26,710			$	19,739
Adjustment for taxable equivalent interest			(392)				(397)				(389)				(399)				(390)
Net interest income  (GAAP)		$	36,840			$	37,597			$	36,322			$	26,311			$	19,349
Net interest margin (GAAP)			3.59	%			3.73	%			3.66	%			3.43	%			2.98	%
(dollars in thousands)		2025 4th Qtr.				2025 3rd Qtr.				2025 2nd Qtr.				2025 1st Qtr.				2024 4th Qtr.
Total assets		$	4,410,551			$	4,296,902			$	4,310,252			$	4,305,391			$	2,723,243
Less: goodwill			129,854				126,730				126,730				126,730				59,946
Less: core deposit intangible			31,149				31,694				33,421				35,153				1,096
Tangible assets		$	4,249,548			$	4,138,478			$	4,150,101			$	4,143,508			$	2,662,201
Total equity		$	465,353			$	449,615			$	431,761			$	427,068			$	260,415
Less: goodwill			129,854				126,730				126,730				126,730				59,946
Less: core deposit intangible			31,149				31,694				33,421				35,153				1,096
Tangible common equity		$	304,350			$	291,191			$	271,610			$	265,185			$	199,373
Tangible common equity to tangible assets			7.16	%			7.04	%			6.54	%			6.40	%			7.49	%
(dollars in thousands)		2025 4th Qtr.				2025 3rd Qtr.				2025 2nd Qtr.				2025 1st Qtr.				2024 4th Qtr.
Net income		$	13,867			$	14,681			$	13,534			$	(13,906)			$	7,159
Less: intangible amortization (tax affected at 21%)			1,330				1,365				1,369				537				121
Adjusted net income		$	12,537			$	13,316			$	12,165			$	(14,443)			$	7,038
Average shareholders' equity		$	459,423			$	438,449			$	427,543			$	302,537			$	254,737
Less: average goodwill			127,308				126,730				126,730				83,030				59,946
Less: average core deposit intangible			31,092				32,599				34,356				12,983				1,179
Average tangible common equity		$	301,023			$	279,120			$	266,457			$	206,524			$	193,612
Return on average tangible common equity			16.66	%			19.08	%			18.26	%			-27.97	%			14.54	%

 

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SOURCE ChoiceOne Financial Services, Inc.

FAQ

What were ChoiceOne's reported net income and diluted EPS for Q4 2025 (COFS)?

ChoiceOne reported Q4 2025 net income of $13.9M and diluted EPS of $0.92. According to the company, merger activity drove year-over-year changes and adjusted EPS excluding merger impacts was materially higher for the full year.

How did the March 1, 2025 merger affect ChoiceOne's balance sheet (COFS)?

The merger added about $1.8B of assets, including roughly $1.4B in loans and deposits. According to the company, the transaction was the primary driver of total assets rising to $4.4B at December 31, 2025.

What is ChoiceOne's asset quality and allowance position as of December 31, 2025 (COFS)?

Nonperforming loans were 0.98% and the allowance for credit losses was 1.18% of loans. According to the company, a portion of NPLs relates to purchased loans identified with credit deterioration before the merger.

How much did merger-related costs and provisions impact ChoiceOne's 2025 results (COFS)?

Merger-related expenses, net of tax, totaled $13.9M, and merger-related provision for credit losses, net of tax, was $9.5M. According to the company, excluding these items materially increases reported adjusted net income for 2025.

Did ChoiceOne show organic loan growth excluding merger contributions in 2025 (COFS)?

Yes. Core loans grew organically by $86.1M, a 5.7% increase for the twelve months ended December 31, 2025. According to the company, fourth-quarter annualized core loan growth was 7.6% excluding held-for-sale and interbank loans.