Finward Bancorp Announces Second Quarter 2026 Results

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MUNSTER, Ind.--(BUSINESS WIRE)-- Finward Bancorp (Nasdaq: FNWD) (the “Bancorp”), the holding company for Peoples Bank (the “Bank”), today announced that net income available to common stockholders was $2.1 million, or $0.48 per diluted share, for the quarter ended June 30, 2026, as compared to $2.2 million, or $0.52 per diluted share, for the quarter ended March 31, 2026. Selected performance metrics are as follows for the periods presented:

Performance Ratios
	Quarter ended
	6/30/2026			3/31/2026			12/31/2025			9/30/2025			6/30/2025
Return on equity	4.74	%		5.00	%		4.66	%		8.96	%		5.66	%
Return on assets	0.42	%		0.44	%		0.39	%		0.68	%		0.42	%
Net interest margin, tax-equivalent (non-GAAP)	3.37	%		3.35	%		3.32	%		3.18	%		3.11	%
Non-interest income/average assets	0.48	%		0.48	%		0.29	%		0.57	%		0.53	%
Non-interest expense/average assets	2.95	%		2.93	%		2.90	%		2.74	%		2.90	%
Efficiency ratio	84.52	%		84.45	%		89.50	%		81.22	%		88.92	%

"Despite overhead impacts from merger-related expenses and a previously disclosed branch closure, we showed continued progress in key areas this quarter. Results were supported by solid loan growth, stable deposit funding, and continued momentum across the organization. These results reflect the dedication of our team and the strength of the relationships we have built throughout Northwest Indiana and Chicagoland, and I am proud of what our team has accomplished together," said Benjamin Bochnowski, Chief Executive Officer. "The quarter was also highlighted by the announcement of our planned merger with First Financial. This transaction recognizes the value of our franchise and positions our customers, employees, communities, and shareholders to benefit from an even stronger banking organization in the years ahead. While we are excited about the opportunities this partnership creates, our near-term priorities are clear: serving customers, maintaining strong credit quality, and preparing for a successful combination with First Financial."

Highlights of the current period include:

• Net Interest Margin - The net interest margin for the quarter ended June 30, 2026 was 3.25% compared to 3.23% for the quarter ended March 31, 2026. Net interest margin on a tax-equivalent basis (a non-GAAP measure) for the quarter ended June 30, 2026 was 3.37%, as compared to 3.35% for the quarter ended March 31, 2026. Net interest margin increased from the prior quarter primarily due to continued repricing and maturity of the existing loan portfolio, as well as strength in new loan originations.

• Funding - As of June 30, 2026, deposits totaled $1.73 billion, an increase of $13.5 million, or 0.8% compared with March 31, 2026 balances, which totaled $1.72 billion. As of June 30, 2026, non-interest-bearing deposits totaled $270.7 million, a decrease of $8.0 million. Core deposits totaled $1.2 billion at both June 30, 2026 and March 31, 2026. Core deposits include checking, savings, and money market accounts and represented 71.3% of the Bancorp’s total deposits at June 30, 2026. As of June 30, 2026, balances for certificates of deposit totaled $497.4 million, compared to $488.8 million on March 31, 2026, an increase of $8.6 million or 1.8%. The increase in total portfolio deposits is primarily related to cyclical flows and continued adjustments to deposit pricing. In addition, as of June 30, 2026, borrowings, federal funds purchased and repurchase agreements totaled $95.3 million, an increase of $4.5 million or 4.9%, compared to March 31, 2026. The increase in borrowings was primarily attributable to new FHLB advances in conjunction with increased loan origination during the quarter.
  
  As of June 30, 2026, 72.5% of our deposits are fully FDIC insured, and another 7.8% are further backed by the Indiana Public Deposit Insurance Fund. The Bancorp’s liquidity position remains strong with solid core deposit customer relationships, excess cash, debt securities, contractual loan repayments, and access to diversified borrowing sources. As of June 30, 2026, the Bancorp had available liquidity of $604 million including borrowing capacity from the FHLB and Federal Reserve facilities.

• Securities Portfolio - Securities available for sale balances increased by $2.5 million to $310.2 million as of June 30, 2026, compared to $307.7 million as of March 31, 2026. The yield on the securities portfolio increased to 2.27% for the three months ended June 30, 2026 from 2.22% for the three months ended March 31, 2026. The increase in securities available for sale was primarily attributable to a decrease in the negative fair value adjustment to securities. The Bank did not sell or purchase any securities during the quarter.

• Lending - The Bank’s aggregate loan portfolio totaled $1.50 billion on June 30, 2026 and $1.46 billion on March 31, 2026. During the three months ended June 30, 2026, the Bank originated $81.3 million in new commercial loans, compared to $37.4 million during the three months ended March 31, 2026, based on strength experienced in the lending pipeline, specifically within commercial business and commercial real estate portfolios. At June 30, 2026, the Bancorp’s portfolio loan balances in commercial real estate owner occupied properties totaled $262.4 million or 17.4% of loans receivable and commercial real estate non-owner occupied properties totaled $334.9 million or 22.3% of loans receivable. Of the $334.9 million in commercial real estate non-owner occupied properties balances, loans collateralized by office buildings represented $41.2 million or 2.7% of total loan balances.

• Asset Quality - At June 30, 2026, non-performing loans totaled $16.5 million, compared to $12.4 million at March 31, 2026, an increase of $4.2 million or 33.8%. The Bank’s ratio of non-performing loans to total loans was 1.10% at June 30, 2026, compared to 0.85% at March 31, 2026. The Bank’s ratio of non-performing assets to total assets was 0.90% at June 30, 2026 and 0.71% at March 31, 2026. The non-performing balance increases are driven by a variety of credits and not due to concentrations or an indication of overall economic stress within our customer base or footprint. The increase in non-performers consisted of twelve loans from eleven different relationships, averaging $417 thousand per loan across commercial real estate, multifamily and residential real estate. Management maintains a vigilant oversight of nonperforming loans through proactive relationship management. The Bank has no known credit exposures to non-depositary financial institutions at this time.
  
  The allowance for credit losses (ACL) on loans totaled $17.7 million at June 30, 2026, or 1.18% of total loans receivable, compared to $17.3 million at March 31, 2026, or 1.19% of total loans receivable, an increase of $409 thousand or 2.37%. The Bank's unused commitment reserve, included in other liabilities, totaled $1.9 million at June 30, 2026, compared to $2.0 million at March 31, 2026, a decrease of $114 thousand or 5.6%.
  
  For the quarter ended June 30, 2026, the Bank recorded a net provision for credit loss totaling $264 thousand based on quarterly growth in certain loan segment balances and other factors within the Bank's ACL modeling. The second quarter's provision consisted of a $378 thousand provision for credit losses on loans, and a $114 thousand reversal of credit losses on unused commitments. For the quarter ended June 30, 2026, net loan recoveries totaled $31 thousand, compared to net loan recoveries of $3 thousand for the quarter ended March 31, 2026. The allowance for credit losses as a percentage of non-performing loans, or coverage ratio, was 106.9% at June 30, 2026, compared to 139.7% at March 31, 2026.

• Operating Income and Expenses - Non-interest income as a percentage of average assets was 0.48% for both the quarter ended June 30, 2026 and March 31, 2026. Total non-interest expense increased slightly from the prior quarter, while non-interest expense as a percentage of average assets was 2.95% for the quarter ended June 30, 2026, as compared to 2.93% for the quarter ended March 31, 2026. The aggregate reduction in non-interest income as compared to the prior quarter was due to a $180 thousand loss associated with the closure of one of the Bancorp's leased branch locations. The increase in non-interest expense quarter over quarter was primarily attributable to compensation and benefits and seasonality of certain professional and outside services expenses.

• Capital Adequacy - The Bank’s tier 1 leverage ratio was 9.31% as of June 30, 2026 and 9.24% as of March 31, 2026. The Bank’s capital continues to exceed all applicable regulatory capital requirements. The Bancorp’s tangible book value per share (non-GAAP) was $35.75 at June 30, 2026, up from $34.39 as of March 31, 2026. Tangible common equity to tangible assets (non-GAAP) was 7.68% at June 30, 2026, up from 7.48% as of March 31, 2026.

Disclosures Regarding Non-GAAP Financial Measures

Reported amounts are presented in accordance with GAAP. In this press release, the Bancorp also provides certain financial measures identified as non-GAAP. The Bancorp’s management believes that the non-GAAP information, which consists of tangible common equity, tangible book value per share, tangible common equity/tangible assets, net interest margin on a tax-equivalent basis, and efficiency ratio which can vary from period to period, provides a better comparison of period to period operating performance. The net interest income and net interest margin on a tax-equivalent basis measures recognize the income tax savings when comparing taxable and tax-exempt assets. Interest income and yields on tax-exempt securities and loans are presented using the current federal corporate income tax rate of 21%. Management believes that it is standard practice in the banking industry to present net interest income and net interest margin on a fully tax-equivalent basis and that it may enhance comparability for peer comparison purposes. Additionally, the Bancorp believes this information is utilized by regulators and market analysts to evaluate a company’s financial condition and, therefore, such information is useful to investors. These disclosures should not be viewed as a substitute for financial results in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures which may be presented by other companies. Refer to the "Reconciliation of non-GAAP Financial Measures" below for more information.

About Finward Bancorp

Finward Bancorp is a locally managed and independent financial holding company headquartered in Munster, Indiana, whose activities are primarily limited to holding the stock of Peoples Bank. Peoples Bank provides a wide range of personal, business, electronic and wealth management financial services from its 24 locations in Lake and Porter Counties in Northwest Indiana and Chicagoland. Finward Bancorp’s common stock is quoted on The NASDAQ Stock Market, LLC under the symbol FNWD. The website ibankpeoples.com provides information on Peoples Bank’s products and services, and Finward Bancorp’s investor relations.

Forward Looking Statements

This press release may contain forward-looking statements regarding the financial performance, business prospects, growth and operating strategies of the Bancorp. For these statements, the Bancorp claims the protections of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. Statements in this communication should be considered in conjunction with the other information available about the Bancorp, including the information in the filings the Bancorp makes with the SEC. Forward-looking statements provide current expectations or forecasts of future events and are not guarantees of future performance. The forward-looking statements are based on management’s expectations and are subject to a number of risks and uncertainties. Forward-looking statements are typically identified by using words such as “anticipate,” “estimate,” “project,” “intend,” “plan,” “believe,” “will” and similar expressions in connection with any discussion of future operating or financial performance.

Although management believes that the expectations reflected in such forward-looking statements are reasonable, actual results may differ materially from those expressed or implied in such statements. Risks and uncertainties that could cause actual results to differ materially include: changes in domestic and international trade policies, including tariffs and other non-tariff barriers, and the effects of such changes on the Bank and its customers; risks related to the development and use of artificial intelligence (AI); changes in asset quality and credit risk; the inability to sustain revenue and earnings growth; changes in interest rates, market liquidity, and capital markets, as well as the magnitude of such changes, which may reduce net interest margins; inflation; further deterioration in the market value of securities held in the Bancorp’s investment securities portfolio, whether as a result of macroeconomic factors or otherwise; customer acceptance of the Bancorp’s products and services; customer borrowing, repayment, investment, and deposit practices; customer disintermediation; the introduction, withdrawal, success, and timing of business initiatives; competitive conditions; the inability to realize cost savings or revenues or to implement integration plans and other consequences associated with mergers, acquisitions, and divestitures; economic conditions; and the impact, extent, and timing of technological changes, capital management activities, regulatory actions by the Federal Deposit Insurance Corporation and Indiana Department of Financial Institutions, and other actions of the Federal Reserve Board and legislative and regulatory actions and reforms. Additional factors that could cause actual results to differ materially from those expressed in the forward-looking statements are discussed in the Bancorp’s reports (such as the Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, and Current Reports on Form 8-K) filed with the SEC and available at the SEC’s Internet website (www.sec.gov). All subsequent written and oral forward-looking statements concerning matters attributable to the Bancorp or any person acting on its behalf are expressly qualified in their entirety by the cautionary statements above. Except as required by law, The Bancorp does not undertake any obligation to update any forward-looking statement to reflect circumstances or events that occur after the date the forward-looking statement is made.

In addition to the above factors, we also caution that the actual amounts and timing of any future common stock dividends or share repurchases will be subject to various factors, including our capital position, financial performance, capital impacts of strategic initiatives, market conditions, and regulatory and accounting considerations, as well as any other factors that our Board of Directors deems relevant in making such a determination. Therefore, there can be no assurance that we will repurchase shares or pay any dividends to holders of our common stock, or as to the amount of any such repurchases or dividends.

Performance Ratios

	Quarter Ended																				Six Months Ended
	6/30/2026				3/31/2026				12/31/2025				9/30/2025				6/30/2025				6/30/2026				6/30/2025
Return on equity		4.74	%			5.00	%			4.66	%			8.96	%			5.66	%			4.87	%			3.39	%
Return on assets		0.42	%			0.44	%			0.39	%			0.68	%			0.42	%			0.43	%			0.25	%
Yield on loans		5.55	%			5.50	%			5.64	%			5.49	%			5.36	%			5.53	%			5.31	%
Yield on security investments		2.27	%			2.22	%			2.29	%			2.40	%			2.42	%			2.25	%			2.40	%
Total yield on earning assets		4.93	%			4.86	%			4.96	%			4.91	%			4.82	%			4.90	%			4.77	%
Cost of interest-bearing deposits		1.98	%			1.92	%			2.09	%			2.16	%			2.12	%			1.95	%			2.14	%
Cost of federal funds purchased and repurchase agreements		2.82	%			2.85	%			3.12	%			3.37	%			3.32	%			2.84	%			3.34	%
Cost of borrowed funds		3.80	%			3.70	%			3.70	%			3.64	%			3.91	%			3.75	%			4.01	%
Total cost of interest-bearing liabilities		2.06	%			2.00	%			2.16	%			2.25	%			2.22	%			2.03	%			2.25	%
Net interest margin		3.25	%			3.23	%			3.18	%			3.04	%			2.97	%			3.24	%			2.89	%
Net interest margin, tax-equivalent (non-GAAP) (1)		3.37	%			3.35	%			3.32	%			3.18	%			3.11	%			3.36	%			3.03	%
Non-interest income/average assets		0.48	%			0.48	%			0.29	%			0.57	%			0.53	%			0.48	%			0.48	%
Non-interest expense/average assets		2.95	%			2.93	%			2.90	%			2.74	%			2.90	%			2.95	%			2.86	%
Efficiency ratio (non-GAAP) (1)		84.52	%			84.45	%			89.50	%			81.22	%			88.92	%			84.48	%			90.95	%
Non-performing assets to total assets		0.90	%			0.71	%			0.65	%			0.76	%			0.74	%			0.90	%			0.74	%
Non-performing loans to total loans		1.10	%			0.85	%			0.77	%			0.94	%			0.91	%			1.10	%			0.91	%
Allowance for credit losses to non-performing loans		106.92	%			139.72	%			156.84	%			129.41	%			133.01	%			106.92	%			133.01	%
Allowance for credit losses to loans receivable		1.18	%			1.19	%			1.21	%			1.22	%			1.22	%			1.18	%			1.22	%
Net charge-offs (recoveries) as a percentage of average loans receivable		(0.01	%)			0.00	%			0.08	%			0.07	%			(0.11	%)			(0.01	)%			(0.05	)%
Basic earnings per share	$	0.49			$	0.52			$	0.46			$	0.82			$	0.50			$	1.01			$	0.61
Diluted earnings per share	$	0.48			$	0.52			$	0.46			$	0.81			$	0.50			$	1.00			$	0.61
Weighted average common shares outstanding—basic		4,280,844				4,276,530				4,273,421				4,273,022				4,271,952				4,278,699				4,269,478
Weighted average common shares outstanding—diluted		4,319,052				4,302,206				4,301,462				4,299,007				4,291,319				4,316,606				4,287,877
Stockholders' equity to total assets		8.74	%			8.56	%			8.64	%			8.06	%			7.48	%			8.74	%			7.48	%
Tangible common equity to tangible assets (non-GAAP) (1)		7.68	%			7.48	%			7.56	%			6.99	%			6.41	%			7.68	%			6.41	%
Book value per share	$	41.15			$	39.81			$	40.37			$	38.24			$	35.67			$	41.15			$	35.67
Tangible common book value per share (non-GAAP) (1)	$	35.75			$	34.39			$	34.92			$	32.77			$	30.16			$	35.75			$	30.16
Closing stock price	$	36.78			$	36.30			$	35.19			$	32.09			$	27.62			$	35.19			$	27.62
Dividends declared per common share	$	0.12			$	0.12			$	0.12			$	0.12			$	0.12			$	0.24			$	0.12
(1) See the reconciliation of these non-GAAP measures to the most directly comparable GAAP measures on pg 13.

Average Balances, Interest, Rates

	Quarter Ended
	June 30, 2026											March 31, 2026											December 31, 2025
(Dollars in thousands)	Average Balance				Interest				Yield/Rate			Average Balance				Interest				Yield/Rate			Average Balance				Interest				Yield/Rate
ASSETS
Interest bearing deposits in other financial institutions	$	78,886			$	718			3.64	%		$	96,250			$	949			3.94	%		$	100,035			$	903			3.61	%
Federal funds sold		1,046				8			3.06	%			1,523				11			2.89	%			1,113				10			3.59	%
Securities available-for-sale		309,251				1,757			2.27	%			318,670				1,771			2.22	%			327,747				1,877			2.29	%
Loans receivable		1,474,063				20,468			5.55	%			1,445,921				19,871			5.50	%			1,454,174				20,496			5.64	%
Federal Home Loan Bank stock		6,547				114			6.97	%			6,547				119			7.27	%			6,547				126			7.70	%
Total interest earning assets		1,869,793			$	23,065			4.93	%			1,868,911			$	22,721			4.86	%			1,889,616			$	23,412			4.96	%
Cash and non-interest bearing deposits in other financial institutions		15,504											21,331											23,385
Allowance for credit losses		(17,418	)										(17,608	)										(18,049	)
Other non-interest bearing assets		143,484											143,452											146,675
Total assets	$	2,011,363										$	2,016,086										$	2,041,627
LIABILITIES AND STOCKHOLDERS' EQUITY
Interest-bearing deposits	$	1,446,072			$	7,159			1.98	%		$	1,447,994			$	6,959			1.92	%		$	1,458,748			$	7,605			2.09	%
Federal funds purchased and repurchase agreements		33,076				233			2.82	%			38,113				272			2.85	%			40,968				317			3.10	%
Borrowed funds		51,925				493			3.80	%			45,334				419			3.70	%			48,089				448			3.73	%
Total interest bearing liabilities		1,531,073			$	7,885			2.06	%			1,531,441			$	7,650			2.00	%			1,547,805			$	8,370			2.16	%
Non-interest bearing deposits		268,540											270,626											288,073
Other non-interest bearing liabilities		35,243											34,588											35,588
Total liabilities		1,834,856											1,836,655											1,871,466
Total stockholders' equity		176,507											179,431											170,161
Total liabilities and stockholders' equity	$	2,011,363										$	2,016,086										$	2,041,627
Net interest income					$	15,180										$	15,071										$	15,042
Return on average assets		0.42	%										0.44	%										0.39	%
Return on average equity		4.74	%										5.00	%										4.66	%
Net interest margin		3.25	%										3.23	%										3.18	%
Net interest margin, tax-equivalent (non-GAAP)(1)		3.37	%										3.35	%										3.32	%
Net interest spread		2.87	%										2.86	%										2.80	%
Ratio of interest-earning assets to interest-bearing liabilities	1.22x											1.22x											1.22x
(1) See the reconciliation of non-GAAP measures to the most directly comparable GAAP measures on pg 13.

Consolidated Balance Sheets

	As of
(Dollars in thousands)	6/30/2026				3/31/2026				12/31/2025				9/30/2025				6/30/2025
ASSETS
Cash and non-interest bearing deposits in other financial institutions	$	17,384			$	15,758			$	18,265			$	19,458			$	23,027
Interest bearing deposits in other financial institutions		76,270				102,997				101,382				84,157				79,976
Federal funds sold		988				-				-				563				411
Total cash and cash equivalents		94,642				118,755				119,647				104,178				103,414
Securities available-for-sale		310,198				307,686				316,227				335,150				327,845
Loans held-for-sale		1,083				-				1,096				2,641				834
Loans receivable, net of deferred fees and costs		1,503,793				1,455,118				1,450,387				1,473,774				1,484,278
Less: allowance for credit losses		(17,694	)			(17,285	)			(17,506	)			(17,977	)			(18,184	)
Net loans receivable		1,486,099				1,437,833				1,432,881				1,455,797				1,466,094
Federal Home Loan Bank stock		6,547				6,547				6,547				6,547				6,547
Accrued interest receivable		7,671				7,700				7,781				7,585				7,651
Premises and equipment		43,932				44,315				44,976				45,544				46,179
Cash value of bank owned life insurance		34,010				33,786				33,586				33,843				33,932
Goodwill		22,395				22,395				22,395				22,395				22,395
Other intangible assets		984				1,076				1,172				1,273				1,414
Other assets		33,145				35,063				34,873				37,771				41,606
Total assets	$	2,040,706			$	2,015,156			$	2,021,181			$	2,052,724			$	2,057,911
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:
Non-interest bearing	$	270,682			$	278,705			$	267,441			$	280,296			$	271,172
Interest bearing		1,461,862				1,440,366				1,459,530				1,470,350				1,483,678
Total		1,732,544				1,719,071				1,726,971				1,750,646				1,754,850
Federal funds purchased and repurchase agreements		30,301				40,815				39,703				48,426				48,331
Borrowed funds		65,000				50,000				45,000				55,000				65,000
Accrued expenses and other liabilities		34,574				32,870				34,844				33,157				35,477
Total liabilities		1,862,419				1,842,756				1,846,518				1,887,229				1,903,658
Stockholders' Equity:
Preferred stock, no par or stated value; 10,000,000 shares authorized, none outstanding		-				-				-				-				-
Common stock, no par or stated value; 10,000,000 shares authorized(1)		-				-				-				-				-
Additional paid-in capital		70,530				70,397				70,331				70,233				70,263
Accumulated other comprehensive loss		(41,532	)			(45,713	)			(41,662	)			(49,266	)			(57,560	)
Retained earnings		149,289				147,716				145,994				144,528				141,550
Total stockholders' equity		178,287				172,400				174,663				165,495				154,253
Total liabilities and stockholders' equity	$	2,040,706			$	2,015,156			$	2,021,181			$	2,052,724			$	2,057,911
(1) Shares of common stock issued and outstanding were 4,333,002 at 6/30/2026; 4,330,486 at 3/31/2026; 4,326,747 at 12/31/2025; 4,327,511 at 9/30/2025; and 4,324,889 at 6/30/2025.

Consolidated Statements of Income

	Quarter Ended
(Dollars in thousands, except per share data)	6/30/2026				3/31/2026				12/31/2025				9/30/2025				6/30/2025
Interest income:
Loans	$	20,468			$	19,871			$	20,496			$	20,246			$	19,940
Securities & short-term investments		2,597				2,850				2,916				3,094				2,730
Total interest income		23,065				22,721				23,412				23,340				22,670
Interest expense:
Deposits		7,159				6,959				7,605				7,996				7,780
Borrowings		726				691				765				901				945
Total interest expense		7,885				7,650				8,370				8,897				8,725
Net interest income		15,180				15,071				15,042				14,443				13,945
Provision for (benefit from) credit losses		264				55				(84	)			(301	)			(274	)
Net interest income after provision for credit losses		14,916				15,016				15,126				14,744				14,219
Non-interest income:
Fees and service charges		1,331				1,295				1,485				1,463				1,330
Wealth management operations		748				661				659				759				696
Gain (loss) on tax credit investment		-				-				-				23				-
Gain (loss) on sale of loans held-for-sale, net		228				257				346				265				378
Gain (loss) on sale of securities, net		-				-				(1,577	)			-				-
Bank owned life insurance		223				201				522				439				220
Gain (loss) on sale of property and equipment		(180	)			-				1				(56	)			-
Other		48				3				37				20				59
Total non-interest income		2,398				2,417				1,473				2,913				2,683
Non-interest expense:
Compensation and benefits		8,033				7,591				7,573				7,330				7,313
Occupancy and equipment		1,741				1,991				2,111				2,004				1,935
Data processing		1,176				1,105				1,465				1,116				1,341
Federal deposit insurance premiums		347				381				417				399				471
Marketing		266				587				230				257				214
Professional and outside services		1,221				1,169				906				945				1,115
Technology		516				508				521				549				545
Other		1,557				1,436				1,558				1,497				1,852
Total non-interest expense		14,857				14,768				14,781				14,097				14,786
Income before income taxes		2,457				2,665				1,818				3,560				2,116
Income tax expenses (benefit)		364				423				(166	)			63				(35	)
Net income	$	2,093			$	2,242			$	1,984			$	3,497			$	2,151
Earnings per common share:
Basic	$	0.49			$	0.52			$	0.46			$	0.82			$	0.50
Diluted	$	0.48			$	0.52			$	0.46			$	0.81			$	0.50

Consolidated Statements of Income (cont'd)

	Six Months Ended
(Dollars in thousands, except per share data)	6/30/2026				6/30/2025
Interest income:
Loans	$	40,339			$	39,595
Securities & short-term investments		5,447				5,416
Total interest income		45,786				45,011
Interest expense:
Deposits		14,118				15,825
Borrowings		1,417				1,928
Total interest expense		15,535				17,753
Net interest income		30,251				27,258
Provision for (benefit from) credit losses		319				180
Net interest income after provision for credit losses		29,932				27,078
Non-interest income:
Fees and service charges		2,626				2,439
Wealth management operations		1,409				1,315
Gain on tax credit investment		—				67
Gain on sale of loans held-for-sale, net		485				608
Bank owned life insurance		424				418
Gain (loss) on sale of property and equipment		(180	)			-
Other		51				65
Total non-interest income		4,815				4,912
Non-interest expense:
Compensation and benefits		15,624				14,685
Occupancy and equipment		3,732				4,046
Data processing		2,281				2,380
Federal deposit insurance premiums		728				904
Marketing		853				300
Professional and outside services		2,390				2,375
Technology		1,024				999
Other		2,993				3,569
Total non-interest expense		29,625				29,258
Income before income taxes		5,122				2,732
Income tax expenses		787				126
Net income	$	4,335			$	2,606
Earnings per common share:
Basic	$	1.01			$	0.61
Diluted	$	1.00			$	0.61

Loans

	As of
(Dollars in thousands)	6/30/2026				3/31/2026				12/31/2025				9/30/2025				6/30/2025				6/30/2026 vs 3/31/2026							6/30/2026 vs 6/30/2025
Residential real estate	$	455,882			$	445,097			$	442,443			$	450,007			$	457,248			$	10,785			2.4	%		$	(1,366	)		(0.3	)%
Home equity		55,601				53,855				53,497				51,813				51,112				1,746			3.2	%			4,489			8.8	%
Commercial real estate		597,364				564,613				555,594				564,558				551,091				32,751			5.8	%			46,273			8.4	%
Construction and land development		77,710				76,582				77,208				79,678				74,795				1,128			1.5	%			2,915			3.9	%
Multifamily		180,148				185,824				183,902				192,698				200,440				(5,676	)		(3.1	)%			(20,292	)		(10.1	)%
Commercial business		103,281				94,160				99,304				96,192				105,636				9,121			9.7	%			(2,355	)		(2.2	)%
Consumer		2,036				310				870				348				2,347				1,726			556.8	%			(311	)		(13.3	)%
Manufactured homes		22,050				22,981				23,708				24,372				25,146				(931	)		(4.1	)%			(3,096	)		(12.3	)%
Government		9,818				9,998				12,298				12,298				14,628				(180	)		(1.8	)%			(4,810	)		(32.9	)%
Loans receivable		1,503,890				1,453,420				1,448,824				1,471,964				1,482,443				50,470			3.5	%			21,447			1.4	%
Net deferred loan origination costs		1,006				1,723				1,606				1,719				2,012				(717	)		(41.6	)%			(1,006	)		(50.0	)%
Loan clearing funds		(1,103	)			(25	)			(43	)			91				(177	)			(1,078	)		4312.0	%			(926	)		523.2	%
Loans receivable, net	$	1,503,793			$	1,455,118			$	1,450,387			$	1,473,774			$	1,484,278			$	48,675			3.3	%		$	19,515			1.3	%

Deposits

	As of
(Dollars in thousands)	6/30/2026				3/31/2026				12/31/2025				9/30/2025				6/30/2025				6/30/2026 vs 3/31/2026							6/30/2026 vs 6/30/2025
Checking	$	584,901			$	587,575			$	592,214			$	579,760			$	593,471			$	(2,674	)		(0.5	)%		$	(8,570	)		(1.4	)%
Savings		247,054				253,408				254,055				257,058				266,070				(6,354	)		(2.5	)%			(19,016	)		(7.1	)%
Money market		403,140				389,274				381,111				377,155				352,616				13,866			3.6	%			50,524			14.3	%
Certificates of deposit		497,449				488,814				499,591				536,673				542,693				8,635			1.8	%			(45,244	)		(8.3	)%
Total deposits	$	1,732,544			$	1,719,071			$	1,726,971			$	1,750,646			$	1,754,850			$	13,473			0.8	%		$	(22,306	)		(1.3	)%

Asset Quality

	As of and for the Quarter Ended
(Dollars in thousands)	6/30/2026				3/31/2026				12/31/2025				9/30/2025				6/30/2025
Non-accruing loans	$	16,549			$	12,371			$	11,162			$	13,892			$	13,526
Accruing loans delinquent more than 90 days		-				-				-				-				145
Securities in non-accrual		1,909				1,891				1,882				1,616				1,616
Foreclosed real estate		-				89				89				-				-
Total nonperforming assets	$	18,458			$	14,351			$	13,133			$	15,508			$	15,287
Allowance for credit losses (ACL):
ACL specific allowances for collateral dependent loans	$	147			$	-			$	263			$	912			$	570
ACL general allowances for loan portfolio		17,547				17,285				17,243				17,065				17,614
Total ACL	$	17,694			$	17,285			$	17,506			$	17,977			$	18,184

Allowance for Credit Losses

	As of and for the Quarter Ended
(Dollars in thousands)	6/30/2026				3/31/2026				12/31/2025				9/30/2025				6/30/2025
Beginning allowance for credit losses	$	17,285			$	17,506			$	17,977			$	18,184			$	17,955
Provision for (benefit from) loan losses		378				(224	)			(170	)			61				(185	)
Net (charge-offs) recoveries		31				3				(301	)			(268	)			414
Ending allowance for credit losses	$	17,694			$	17,285			$	17,506			$	17,977			$	18,184

Bank-Level Regulatory Capital Requirements

		June 30, 2026
		Actual (1)							Minimum Required For Capital Adequacy Purposes							Minimum Required To Be Well Capitalized Under Prompt Corrective Action Regulations
(Dollars in thousands)		Amount				Ratio			Amount			Ratio				Amount				Ratio
Common equity tier 1 capital to risk-weighted assets		$	189,965			11.81	%		$	72,385			4.50	%		$	104,557			6.50	%
Tier 1 capital to risk-weighted assets		$	189,965			11.81	%		$	96,514			6.00	%		$	128,685			8.00	%
Total capital to risk-weighted assets		$	209,575			13.03	%		$	128,685			8.00	%		$	160,856			10.00	%
Tier 1 leverage ratio		$	189,965			9.31	%		$	81,581			4.00	%		$	101,976			5.00	%
(1) Current quarter ratios are estimated.

Reconciliation of Non-GAAP Performance Measures

	Quarter Ended
(Dollars in thousands, except per share amounts)	6/30/2026				3/31/2026				12/31/2025				9/30/2025				6/30/2025
Tangible Common Ratios
Stockholder's equity (GAAP)	$	178,287			$	172,400			$	174,663			$	165,495			$	154,253
Less: Goodwill (GAAP)		(22,395	)			(22,395	)			(22,395	)			(22,395	)			(22,395	)
Less: Other intangibles (GAAP)		(984	)			(1,076	)			(1,172	)			(1,273	)			(1,414	)
Tangible common equity (non-GAAP)	$	154,908			$	148,929			$	151,096			$	141,827			$	130,444
Total assets (GAAP)	$	2,040,706			$	2,015,156			$	2,021,181			$	2,052,724			$	2,057,911
Less: Goodwill (GAAP)		(22,395	)			(22,395	)			(22,395	)			(22,395	)			(22,395	)
Less: Other intangibles (GAAP)		(984	)			(1,076	)			(1,172	)			(1,273	)			(1,414	)
Tangible assets (non-GAAP)	$	2,017,327			$	1,991,685			$	1,997,614			$	2,029,056			$	2,034,102
Shares outstanding - end of quarter		4,333,002				4,330,486				4,326,747				4,327,511				4,324,889
Common book value per share (GAAP)	$	41.15			$	39.81			$	40.37			$	38.24			$	35.67
Tangible common book value per share (non-GAAP)	$	35.75			$	34.39			$	34.92			$	32.77			$	30.16
Total equity to total assets (GAAP)		8.74	%			8.56	%			8.64	%			8.06	%			7.50	%
Tangible common equity to tangible assets (non-GAAP)		7.68	%			7.48	%			7.56	%			6.99	%			6.41	%
Calculation of net interest margin, taxable-equivalent basis
Net interest income (GAAP)	$	15,180			$	15,071			$	15,042			$	14,443			$	13,945
Tax-equivalent adjustment on securities and loans (1)		580				582				629				663				674
Net interest income (tax-equivalent basis)	$	15,760			$	15,653			$	15,671			$	15,106			$	14,619
Total average earning assets	$	1,869,793			$	1,868,911			$	1,889,616			$	1,900,066			$	1,879,892
Net interest margin		3.25	%			3.23	%			3.18	%			3.04	%			2.97	%
Net interest margin (tax-equivalent basis)		3.37	%			3.35	%			3.32	%			3.18	%			3.11	%
Efficiency ratio
Total non-interest expense	$	14,857			$	14,768			$	14,781			$	14,097			$	14,786
Total revenue		17,578				17,488				16,515				17,356				16,628
Efficiency ratio		84.52	%			84.45	%			89.50	%			81.22	%			88.92	%
(1) The tax equivalent adjustment represents the increase in net interest income needed to reflect the tax-exempt income from certain investment securities and loans on tax-equivalent basis using a federal statutory corporate rate of 21%.

 

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Source: Finward Bancorp