First Guaranty posts $12M profit for Q3 2026
The Bank's full-quarter reported leverage was 8.29% against the Consent Order's 9.0% minimum, while September-only measurement exceeded 9.0%.
Sentiment and the balance of points
Rhea-AI Sentiment reads the wording of the document, how positive or negative its language is on a 1 to 5 scale. The balance of points shown with the takes weighs what the document actually discloses, so the two can disagree, for example when a trial that missed its main goal is described in upbeat language.
Form Type
8-K
Rhea-AI Filing Summary
First Guaranty Bancshares, Inc. reported third-quarter 2026 net income of $12.0 million, versus a $45.0 million loss a year earlier; nine-month net income was $18.1 million versus a $58.5 million loss. The July 31, 2026 sale of its Texas operations to Armstrong Bank included five branches, approximately $234 million of deposits and $88 million of loans, with an estimated $17.6 million net pre-tax contribution.
The Consent Order issued by the FDIC and Louisiana Office of Financial Institutions, effective August 7, 2026, requires the Bank to maintain at least 9.0% Tier 1 leverage and 14.0% total risk-based capital. At September 30, reported Tier 1 leverage was 8.29% based on full-quarter average assets; using September average assets, it exceeded 9.0%. Management expects the reported ratio to exceed 9.0% at December 31, 2026; total risk-based capital was 18.79%.
Quarterly net interest income was $17.7 million, versus $22.2 million a year earlier. Assets were $3.2 billion and deposits $2.9 billion at September 30, 2026, compared with $4.1 billion and $3.6 billion, respectively, at December 31, 2025.
2 points · 2 major1 major · 2 points
How this balance works
Rhea-AI gives every point it takes from this document a weight. Minor counts 1, Moderate 3 and Major 9, so one Major point outweighs several Minor ones. The bar adds up the weights on each side, and when neither side holds more than 65% of the total the balance reads Mixed.
It reads the document as published, with the same rules for every company, and it does not look at what the market expected or at how the stock traded, so a point can be objectively good on a day the stock falls.
Rhea-AI Sentiment measures something else, the tone of the wording.
Positive
- Major pointNine-month net income: $18.1 million versus a $58.5 million loss in 2025.
- Major pointTexas operations sale estimated to contribute $17.6 million pre-tax. 12% of market cap
Negative
- Major pointFull-quarter Tier 1 leverage was 8.29% versus the Order's 9.0% minimum.
- Moderate pointQuarterly net interest income: $17.7 million, versus $22.2 million in 2025.
Filing Explained
Recent share issuance reduces existing holders’ percentage ownership, absent offsetting changes.
The results release reports 16,638,371 common shares issued and outstanding at
The company reports a signed sale agreement for its
8-K Event Classification
2 items: 2.02, 9.01
2 items
Item 2.02
Results of Operations and Financial Condition
Financial
Disclosure of earnings results, typically an earnings press release or preliminary financials.
Item 9.01
Financial Statements and Exhibits
Exhibits
Financial statements, pro forma financial information, or exhibit attachments filed with this report.
Key Figures
Net income, third quarter: $12.0 million
Net income, nine months: $18.1 million
Texas operations sale contribution: Approximately $17.6 million pre-tax
+5 more
8 metrics
Net income, third quarter
$12.0 million
Three months ended September 30, 2026; compared with a $45.0 million loss in 2025
Net income, nine months
$18.1 million
Nine months ended September 30, 2026; compared with a $58.5 million loss in 2025
Texas operations sale contribution
Approximately $17.6 million pre-tax
Sale completed July 31, 2026
Net interest income, third quarter
$17.7 million
Three months ended September 30, 2026, compared with $22.2 million in 2025
Tier 1 leverage ratio
8.29%
Bank reported ratio at September 30, 2026, based on full-quarter average assets; Consent Order minimum is 9.0%
Total risk-based capital ratio
18.79%
Bank at September 30, 2026; Consent Order requirement is 14.0%
Total assets
$3.2 billion
At September 30, 2026, compared with $4.1 billion at December 31, 2025
Total deposits
$2.9 billion
At September 30, 2026, compared with $3.6 billion at December 31, 2025
Key Terms
Consent Order, Tier 1 leverage ratio, reciprocal deposits, nonaccrual loans, +1 more
5 terms
Consent Order regulatory
"requirements under the Consent Order"
A consent order is a legally binding agreement between a regulator and a company that settles alleged violations without the company admitting guilt, laying out required fixes, penalties, and monitoring steps. For investors it matters because the order can impose fines, increased compliance costs, operational limits or oversight that affect future profits and risk; think of it like agreeing with a landlord to repair lease problems and accept rules to avoid a court battle, but with formal regulatory consequences.
Tier 1 leverage ratio financial
"Tier 1 leverage ratio rose to 8.29%"
Tier 1 leverage ratio measures a bank’s core capital — the money that can absorb losses — as a share of its total assets, showing how much of its balance sheet is funded by real loss-absorbing capital rather than borrowed money. Investors use it like a safety gauge: a higher ratio means a bigger cushion against shocks and lower risk of insolvency, similar to how a thicker spare tire reduces the chance of being stranded.
reciprocal deposits financial
"one-way sell feature of reciprocal deposits"
Reciprocal deposits are a way banks swap large customer funds among a network of banks so each portion stays within the government's insurance limit; from the depositor’s view it lets one large account be protected as if it were many small insured accounts. For investors, reciprocal deposits matter because they provide a low-cost, stable source of insured funding for banks and can affect a bank’s liquidity, perceived safety and reliance on wholesale or volatile funding sources.
nonaccrual loans financial
"Total nonaccrual loans"
Nonaccrual loans are loans a lender has stopped counting toward interest income because the borrower is overdue or unlikely to pay; the lender only records cash payments received and may set aside extra funds to cover potential losses. For investors, a rising number or amount of nonaccrual loans signals weaker credit quality, lower future interest revenue and larger potential write-downs — similar to pausing expected subscription income when many customers stop paying.
OREO financial
"OREO property totals $22.6 million"
Earnings Snapshot
Net income (three months): $12.0 million · Guidance included
Third quarter and nine months ended September 30, 2026
Net income (three months)
$12.0 million
Compared with a $45.0 million loss in 2025
Net income (nine months)
$18.1 million
Compared with a $58.5 million loss in 2025
Net interest income (three months)
$17.7 million
Compared with $22.2 million in 2025
Net interest income (nine months)
$60.6 million
Compared with $66.7 million in 2025
Guidance
The Bank expects its reported Tier 1 leverage ratio to exceed 9.0% at December 31, 2026.
FAQ
AI-generated questions and answers. How Rhea-AI works. Not financial advice.
What was FGBI's third-quarter 2026 net income?
First Guaranty reported net income of $12.0 million for the three months ended September 30, 2026, compared with a $45.0 million loss for the same period in 2025. Net income for the nine months ended September 30, 2026 was $18.1 million, versus a $58.5 million loss in 2025.
How much did FGBI's Texas operations sale contribute?
First Guaranty estimated the completed July 31, 2026 sale contributed approximately $17.6 million to pre-tax income. The sale to Armstrong Bank included five branches, approximately $234 million of deposits and $88 million of loans; the loans were sold at par with no discount.
What actions did FGBI take under the Consent Order?
The Bank prepaid $135.0 million of FHLB advances, incurring a $0.5 million prepayment penalty; used the reciprocal deposit program's one-way sell feature, reducing surplus cash and deposits by $291.4 million as of September 30, 2026; and redeemed $130.6 million of brokered deposits with surplus cash.
When does FGBI expect to sell its largest nonperforming asset?
First Guaranty signed a sales agreement for a $22.6 million independent living center held in OREO and expects the sale to close in the fourth quarter of 2026. It recorded a $0.7 million write-down in the third quarter and incurred $0.3 million in operating expenses for the property during that quarter.
AI-generated analysis. How Rhea-AI works. Not financial advice.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): October 27, 2026
(Exact name of registrant as specified in its charter)
| (State or other jurisdiction | (Commission File Number) | (I.R.S. Employer | ||||||
| incorporation or organization) | Identification Number) | |||||||
| (Address of principal executive offices) | (Zip Code) | |||||||
| (Registrant’s telephone number, including area code) | ||||||||
| Not Applicable | ||||||||
| (Former name or former address, if changed since last report) | ||||||||
Check the appropriate box if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
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. ☐
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||||||||
Item 2.02. Results of Operations and Financial Condition
On October 27, 2026, First Guaranty Bancshares, Inc. issued a press release reporting its financial results at and for the nine months ended September 30, 2026.
The Press Release is enclosed as Exhibit 99.1 to this report. The information in Exhibit 99.1 shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933.
Item 9.01. Financial Statements and Exhibits.
Exhibit 99.1 Press Release dated October 27, 2026.
Exhibit 99.2 Letter to Shareholders dated October 27, 2026.
Forward Looking Statements
This letter contains forward-looking statements within the meaning of the U.S. federal securities laws. Forward-looking statements are any statements other than statements of historical fact which represent our current judgement about possible future events. We believe these judgements are reasonable, but these statements are not guarantees of any future events or financial results, and our actual results may differ materially due to a variety of factors, many of which are described in our most recent Annual Report on Form 10-K and our other filings with the U.S. Securities and Exchange Commission. We caution readers not to place undue reliance on forward-looking statements. Forward-looking statements speak only as of the date they are made, and we undertake no obligation to update or otherwise revise any forward-looking statements.
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 hereunto duly authorized.
| FIRST GUARANTY BANCSHARES, INC. | |||||||||||
| (Registrant) | |||||||||||
| Date: October 27, 2026 | |||||||||||
| By: | /s/Eric J. Dosch | ||||||||||
| Eric J. Dosch | |||||||||||
| Chief Financial Officer | |||||||||||
INDEX TO EXHIBITS
| Exhibit Number | Description | ||||
Exhibit 99.1 | Press Release October 27, 2026 "First Guaranty Bancshares, Inc. Announces Third Quarter 2026 Financial Results." | ||||
Exhibit 99.2 | Letter to Shareholders dated October 27, 2026. | ||||
EXHIBIT 99.1
OCTOBER 27, 2026
NEWS FOR IMMEDIATE RELEASE
CONTACT: ERIC J. DOSCH, CFO
985.375.0308
First Guaranty Bancshares, Inc. Announces Third Quarter 2026 Financial Results
Hammond, Louisiana, October 27, 2026 – First Guaranty Bancshares, Inc. ("First Guaranty") (NASDAQ: FGBI), the holding company for First Guaranty Bank, announced its unaudited financial results for the third quarter and nine months ending September 30, 2026.
Financial Highlights for the third quarter and nine months ended September 30, 2026, are as follows:
•Net income (loss) for the three months ended September 30, 2026 and 2025 was $12.0 million and $(45.0) million, respectively. Net income (loss) for the nine months ended September 30, 2026 and 2025 was $18.1 million and $(58.5) million, respectively, an increase of $76.6 million.
•Third quarter 2026 results were impacted by the sale of First Guaranty Bank's Texas operations and the Bank's strategic changes undertaken in response to the issuance of a Consent Order by the FDIC and OFI (the "Consent Order"), effective August 7, 2026, as previously discussed in the Current Report on Form 8-K dated August 7, 2026.
•On July 31, 2026, First Guaranty Bank completed the sale of its Texas operations to Armstrong Bank, Muskogee, Oklahoma. The transaction included five branches and approximately $234 million of deposits, $88 million of loans, and certain other related assets.
•Key metrics of the Texas sale included the following items (all totals are pre-tax):
◦Deposit premium of 7.65% or $17.9 million.
◦Gain on sale of related real estate of $2.1 million.
◦Legal and professional fees including investment banking fees of $1.9 million.
◦Write off of remaining core deposit acquisition intangibles from 2019 acquisition that totaled $0.7 million.
◦One-time employee severance expenses that totaled $0.1 million.
◦Loans were sold at par with no discount. $0.3 million of loan fees were accreted into income due to the sale.
◦First Guaranty estimates that net contribution of the Texas sale to pre-tax income was approximately $17.6 million.
•First Guaranty’s strategy to comply with the Consent Order includes reducing excess leverage to meet the 9.0% Tier 1 Leverage Ratio requirement and reducing classified and non-performing assets. Notable actions taken or completed during the third quarter 2026 include:
◦Early payoff of $135.0 million in FHLB advances. A $0.5 million pre-payment penalty was incurred.
◦The Bank utilized the One-Way sell feature of reciprocal deposits that reduced surplus cash and deposits by $291.4 million as of September 30, 2026.
◦The Bank redeemed brokered deposits totaling $130.6 million with surplus cash.
◦First Guaranty signed a sales agreement to sell its largest non-performing asset. This OREO property totals $22.6 million. The property was written down by $0.7 million in the third quarter of 2026. First Guaranty anticipates that this transaction is expected to close in the fourth quarter of 2026. First Guaranty incurred $0.3 million in operating expenses related to this property in the third quarter of 2026.
◦First Guaranty wrote off an additional $0.8 million related to bank owned properties that were previously used for branch locations or owned for future branch development.
◦First Guaranty signed a letter of intent to sell its second largest non-performing asset. This loan totals $11.4 million. First Guaranty anticipates that this transaction is expected to close in the fourth quarter of 2026.
◦First Guaranty reduced substandard assets by $31.2 million in the third quarter of 2026.
•Total assets decreased $925.8 million and were $3.2 billion at September 30, 2026 compared to $4.1 billion at December 31, 2025. Total loans at September 30, 2026 were $1.6 billion, a decrease of $488.8 million, or 23.6%, compared with December 31, 2025. Total deposits were $2.9 billion at September 30, 2026, a decrease of $777.9 million, or 21.4%, compared with December 31, 2025. Retained earnings were $29.9 million at September 30, 2026, an increase of $15.9 million compared to $14.1 million at December 31, 2025. Shareholders' equity was $218.9 million and $226.2 million at September 30, 2026 and December 31, 2025, respectively.
•Earnings (loss) per common share were $0.69 and $(3.01) for the three months ended September 30, 2026 and 2025, respectively. Total weighted average shares outstanding were 16,540,173 and 15,122,702 for the three months ended September 30, 2026 and 2025, respectively. Earnings (loss) per common share were $1.01 and $(4.45) for the nine months ended September 30, 2026 and 2025, respectively. Total weighted average shares outstanding were 16,223,484 and 13,523,009 for the nine months ended September 30, 2026 and 2025, respectively.
•The allowance for credit losses was 2.30% of total loans at September 30, 2026 compared to 1.97% at December 31, 2025.
•Net interest income for the three months ended September 30, 2026 was $17.7 million compared to $22.2 million for the three months ended September 30, 2025. Net interest income for the nine months ended September 30, 2026 was $60.6 million compared to $66.7 million for the nine months ended September 30, 2025.
•The provision for credit losses for the three months ended September 30, 2026 was $3.8 million compared to $47.9 million for the three months ended September 30, 2025. The provision for credit losses for the nine months ended September 30, 2026 was $9.0 million compared to $79.1 million for the nine months ended September 30, 2025.
•Charge-offs were $2.5 million during the three months ended September 30, 2026 and $21.3 million during the same period in 2025. Recoveries totaled $0.7 million during the three months ended September 30, 2026 and $0.3 million during the same period in 2025. Charge-offs were $15.7 million during the nine months ended September 30, 2026 and $29.4 million during the same period in 2025. Recoveries totaled $2.2 million during the nine months ended September 30, 2026 and $0.7 million during the same period in 2025.
•First Guaranty had $28.0 million of other real estate owned as of September 30, 2026 compared to $35.1 million at December 31, 2025.
•The net interest margin for the three months ended September 30, 2026 was 2.08% which was a decrease of 26 basis points from the net interest margin of 2.34% for the same period in 2025. The net interest margin for the nine months ended September 30, 2026 was 2.17% which was a decrease of 18 basis points from the net interest margin of 2.35% for the same period in 2025. Loans as a percentage of average interest earning assets decreased to 49.5% at September 30, 2026 compared to 65.1% at September 30, 2025.
•Investment securities totaled $1.2 billion at September 30, 2026, an increase of $162.5 million when compared to $999.3 million at December 31, 2025. At September 30, 2026, available for sale securities, at fair value, totaled $838.3 million, an increase of $161.7 million when compared to $676.6 million at December 31, 2025. At September 30, 2026, held to maturity securities, at amortized cost and net of the allowance for credit losses totaled $323.5 million, an increase of $0.8 million when compared to $322.7 million at December 31, 2025. The allowance for credit losses for HTM securities was $0.2 million at September 30, 2026 and December 31, 2025.
•Total loans net of unearned income were $1.6 billion at September 30, 2026, a net decrease of $488.8 million from December 31, 2025. Total loans net of unearned income are reduced by the allowance for credit losses which totaled $36.4 million at September 30, 2026 and $40.8 million at December 31, 2025, respectively.
•Nonaccrual loans decreased $15.8 million to $43.8 million at September 30, 2026 compared to $59.6 million at December 31, 2025.
•At September 30, 2026, the largest 10 non-performing loan relationships comprise 80% of total non-performing assets. Additional details on the non-performing relationships are as follows:
1.A $22.6 million loan relationship secured by an independent living center located in Louisiana; the loan was transferred to other real estate owned in the fourth quarter of 2025. A $0.7 million writedown to fair value was taken during the third quarter of 2026. First Guaranty signed a sales agreement to sell this property and the transaction is expected to close in the fourth quarter of 2026.
2.An $11.4 million loan relationship secured by an assisted living center located in Texas; the loan was placed on nonaccrual in the third quarter of 2025.
3.A $7.5 million loan relationship secured by commercial land development located in Texas; the loan was placed on nonaccrual in the second quarter of 2026.
4.A $5.2 million loan relationship was placed on nonaccrual during the second quarter of 2025. The loan is secured by multifamily apartment complexes located in Louisiana. This loan relationship had a specific reserve of $0.8 million as of September 30, 2026.
5.A $4.5 million loan relationship was placed on nonaccrual during the third quarter of 2026. The loan is secured by multifamily apartment complexes located in Texas. This loan relationship had a specific reserve of $0.8 million as of September 30, 2026.
6.A $2.4 million guaranteed loan secured by livestock and farmland located in Louisiana; the loan was placed in nonaccrual in the fourth quarter of 2024.
7.A $1.1 million loan secured by multiple office buildings located in West Virginia; the loan was placed on nonaccrual during the second quarter of 2025.
8.A $1.0 million loan secured by a hotel in Louisiana; the loan was placed on nonaccrual during the second quarter of 2026.
9.A $0.9 million loan secured by commercial real estate in Texas; the loan was placed on nonaccrual during the third quarter of 2024.
10.A $0.8 million loan secured by a retail strip center located in Louisiana; the loan was placed on nonaccrual during the fourth quarter of 2025. This loan relationship had a specific reserve of $0.3 million as of September 30, 2026.
•First Guaranty charged off $2.5 million in loan balances during the third quarter of 2026. The details of the $2.5 million in charged-off loans were as follows:
1.First Guaranty charged off $1.8 million on a multifamily relationship during the third quarter of 2026. This relationship had a remaining principal balance of $4.5 million as of September 30, 2026.
2.First Guaranty charged off $0.5 million on a non-farm non-residential loan relationship during the third quarter of 2026. This relationship had a remaining principal balance of $1.0 million as of September 30, 2026.
3.Smaller loans and overdrawn deposit accounts comprised the remaining $0.2 million of charge-offs for the third quarter of 2026.
•Special mention loan relationships totaled $138.0 million as of September 30, 2026, a decline of $191.4 million compared to December 31, 2025.
•Substandard loan relationships totaled $245.4 million as of September 30, 2026, a decline of $102.2 million compared to December 31, 2025.
•There were no doubtful loan relationships as of September 30, 2026, a decline of $9.4 million compared to December 31, 2025.
•OREO properties include $3.6 million in bank properties that previously were active branches or were acquired for future development. The largest facility totals $1.9 million and is under contract with an expected sale in the fourth quarter of 2026. A total of $0.8 million in OREO write downs were taken in the third quarter of 2026 related to these bank facilities.
•Noninterest expense totaled $18.9 million for the third quarter 2026, $17.2 million for the second quarter 2026, $16.7 million for the first quarter 2026, $16.8 million for the fourth quarter of 2025, and $30.2 million for the third quarter of 2025 (including $12.9 million of goodwill impairment). Full time equivalent employees totaled 308 at September 30, 2026 compared to 339 at September 30, 2025.
•Return on average assets for the three months ended September 30, 2026 and 2025 was 1.36% and (4.61)%, respectively. Return on average assets for the nine months ended September 30, 2026 and 2025 was 0.63% and (2.00)%, respectively. Return on average common equity for the three months ended September 30, 2026 and 2025 was 22.74% and (78.41)%, respectively. Return on average common equity for the nine months ended September 30, 2026 and 2025 was 11.24% and (35.83)% respectively. Return on average assets is calculated by dividing annualized net income by average assets. Return on average common equity is calculated by dividing annualized net income by average common equity.
•Book value per common share was $11.17 as of September 30, 2026 compared to $12.23 as of December 31, 2025. The decrease was due primarily to the changes in accumulated other comprehensive income ("AOCI") and recent issuance of new shares. AOCI is comprised of unrealized gains and losses on available for sale securities, including unrealized losses on available for sale securities at the time of transfer to held to maturity.
•First Guaranty's Board of Directors declared cash dividends of $0.01 per common share in the third quarter of 2026 and 2025. First Guaranty has paid 133 consecutive quarterly dividends as of September 30, 2026.
•First Guaranty paid preferred stock dividends of $1.7 million during the first nine months of 2026 and 2025.
About First Guaranty
First Guaranty Bancshares, Inc. is the holding company for First Guaranty Bank, a Louisiana state-chartered bank. Founded in 1934, First Guaranty Bank offers a wide range of financial services and focuses on building client relationships and providing exceptional customer service. First Guaranty Bank currently operates twenty-five locations throughout Louisiana, Kentucky and West Virginia. First Guaranty’s common stock trades on the NASDAQ under the symbol FGBI. For more information, visit www.fgb.net.
Forward Looking Statements
This report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended with respect to the financial condition, liquidity, results of operations, and future performance of the business of First Guaranty Bancshares, Inc. These forward-looking statements are intended to be covered by the safe harbor for “forward-looking statements” provided by the Private Securities Litigation Reform Act of 1995. Forward-looking statements are those that are not historical facts. Forward-looking statements include statements with respect to beliefs, plans, objectives, goals, expectations, anticipations, estimates and intentions that are subject to significant risks and uncertainties and are subject to change based on various factors (some of which are beyond our control). Forward-looking statements often include the words “believes,” “expects,” “anticipates,” “estimates,” “forecasts,” “intends,” “plans,” “targets,” “potentially,” “probably,” “projects,” “outlook” or similar expressions or future conditional verbs such as “may,” “will,” “should,” “would” and “could.” We caution you that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions and uncertainties that are difficult to predict. These forward-looking statements are subject to a number of factors and uncertainties, including, without limitation, the time, resources and strategic changes necessary to adopt and implement all corrective actions required by the Consent Order, the “Risk Factors” referenced in our most recent Annual Report on Form 10-K and any subsequent Quarterly Reports on Form 10-Q, and other risks and uncertainties listed from time to time in our reports and documents filed with the Securities and Exchange Commission. We undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise. Although we believe that the expectations reflected in these forward-looking statements are reasonable as of the date made, actual results may prove to be materially different from the results expressed or implied by the forward-looking statements.
No Offer or Solicitation
This release does not constitute or form part of any offer to sell, or a solicitation of an offer to purchase, any securities of First Guaranty. There will be no sale of securities in any jurisdiction in which such an offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of such jurisdiction.
| FIRST GUARANTY BANCSHARES, INC. AND SUBSIDIARY | ||||||||||||||
| CONSOLIDATED BALANCE SHEETS (unaudited) | ||||||||||||||
| (in thousands, except share data) | September 30, 2026 | December 31, 2025 | ||||||||||||
| Assets | ||||||||||||||
| Cash and cash equivalents: | ||||||||||||||
| Cash and due from banks | $ | 292,226 | $ | 845,150 | ||||||||||
| Federal funds sold | 544 | 551 | ||||||||||||
| Cash and cash equivalents | 292,770 | 845,701 | ||||||||||||
| Interest-earning time deposits with banks | 500 | 250 | ||||||||||||
| Investment securities: | ||||||||||||||
Available for sale, at fair value (cost of $875,612 and $674,139 respectively) | 838,305 | 676,592 | ||||||||||||
Held to maturity, at cost and net of allowance for credit losses of $150 (estimated fair value of $250,422 and $268,094 respectively) | 323,466 | 322,675 | ||||||||||||
| Investment securities | 1,161,771 | 999,267 | ||||||||||||
| Federal Home Loan Bank stock, at cost | 10,544 | 10,206 | ||||||||||||
| Loans, net of unearned income | 1,581,005 | 2,069,802 | ||||||||||||
| Less: allowance for credit losses | 36,400 | 40,755 | ||||||||||||
| Net loans | 1,544,605 | 2,029,047 | ||||||||||||
| Premises and equipment, net | 61,458 | 59,585 | ||||||||||||
| Intangible assets, net | 1,400 | 2,638 | ||||||||||||
| Other real estate, net | 27,950 | 35,084 | ||||||||||||
| Accrued interest receivable | 12,904 | 12,455 | ||||||||||||
| Other assets | 38,583 | 84,088 | ||||||||||||
| Total Assets | $ | 3,152,485 | $ | 4,078,321 | ||||||||||
| Liabilities and Shareholders' Equity | ||||||||||||||
| Deposits: | ||||||||||||||
| Noninterest-bearing demand | $ | 368,328 | $ | 414,604 | ||||||||||
| Interest-bearing demand | 807,107 | 1,165,061 | ||||||||||||
| Savings | 224,556 | 213,936 | ||||||||||||
| Time | 1,454,983 | 1,839,276 | ||||||||||||
| Total deposits | 2,854,974 | 3,632,877 | ||||||||||||
| Repurchase agreements | 7,227 | 7,119 | ||||||||||||
| Accrued interest payable | 19,729 | 17,637 | ||||||||||||
| Long-term advances from Federal Home Loan Bank | — | 135,000 | ||||||||||||
| Senior long-term debt | 14,217 | 14,203 | ||||||||||||
| Junior subordinated debentures | 29,850 | 29,805 | ||||||||||||
| Other liabilities | 7,543 | 15,462 | ||||||||||||
| Total Liabilities | 2,933,540 | 3,852,103 | ||||||||||||
| Shareholders' Equity | ||||||||||||||
| Preferred stock, Series A - $1,000 par value - 100,000 shares authorized | ||||||||||||||
| Non-cumulative perpetual; 34,500 issued and outstanding | 33,058 | 33,058 | ||||||||||||
| Common stock, $1 par value - 100,600,000 shares authorized; 16,638,371 and 15,793,433 shares issued and outstanding | 16,638 | 15,793 | ||||||||||||
| Surplus | 177,215 | 170,621 | ||||||||||||
| Retained earnings | 29,947 | 14,055 | ||||||||||||
| Accumulated other comprehensive (loss) income | (37,913) | (7,309) | ||||||||||||
| Total Shareholders' Equity | 218,945 | 226,218 | ||||||||||||
| Total Liabilities and Shareholders' Equity | $ | 3,152,485 | $ | 4,078,321 | ||||||||||
| See Notes to Consolidated Financial Statements | ||||||||||||||
| FIRST GUARANTY BANCSHARES, INC. AND SUBSIDIARY | ||||||||||||||||||||||||||
| CONSOLIDATED STATEMENTS OF INCOME (unaudited) | ||||||||||||||||||||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||
| (in thousands, except share data) | 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||||
| Interest Income: | ||||||||||||||||||||||||||
| Loans (including fees) | $ | 27,423 | $ | 39,325 | $ | 93,792 | $ | 123,307 | ||||||||||||||||||
| Deposits with other banks | 4,650 | 7,777 | 19,360 | 21,287 | ||||||||||||||||||||||
| Securities (including FHLB stock) | 11,797 | 6,398 | 34,274 | 17,690 | ||||||||||||||||||||||
| Total Interest Income | 43,870 | 53,500 | 147,426 | 162,284 | ||||||||||||||||||||||
| Interest Expense: | ||||||||||||||||||||||||||
| Demand deposits | 7,114 | 13,185 | 24,965 | 38,097 | ||||||||||||||||||||||
| Savings deposits | 1,034 | 1,058 | 2,943 | 3,656 | ||||||||||||||||||||||
| Time deposits | 15,850 | 14,519 | 51,844 | 45,605 | ||||||||||||||||||||||
| Borrowings | 2,221 | 2,500 | 7,056 | 8,225 | ||||||||||||||||||||||
| Total Interest Expense | 26,219 | 31,262 | 86,808 | 95,583 | ||||||||||||||||||||||
| Net Interest Income | 17,651 | 22,238 | 60,618 | 66,701 | ||||||||||||||||||||||
| Less: Provision for credit losses | 3,753 | 47,933 | 9,003 | 79,091 | ||||||||||||||||||||||
| Net Interest Income (Loss) after Provision for Credit Losses | 13,898 | (25,695) | 51,615 | (12,390) | ||||||||||||||||||||||
| Noninterest Income: | ||||||||||||||||||||||||||
| Service charges, commissions and fees | 700 | 832 | 2,194 | 2,515 | ||||||||||||||||||||||
| ATM and debit card fees | 642 | 741 | 1,939 | 2,266 | ||||||||||||||||||||||
| Net gains on securities | — | — | 1 | — | ||||||||||||||||||||||
| Net gains (losses) on sale of assets | 1,716 | (366) | 1,760 | (362) | ||||||||||||||||||||||
| Net gains on sale of branches | 16,137 | — | 16,137 | — | ||||||||||||||||||||||
| Other | 622 | 653 | 1,893 | 1,951 | ||||||||||||||||||||||
| Total Noninterest Income | 19,817 | 1,860 | 23,924 | 6,370 | ||||||||||||||||||||||
| Total Business Revenue (Loss), Net of Provision for Credit Losses | 33,715 | (23,835) | 75,539 | (6,020) | ||||||||||||||||||||||
| Noninterest Expense: | ||||||||||||||||||||||||||
| Salaries and employee benefits | 7,026 | 7,465 | 21,407 | 23,749 | ||||||||||||||||||||||
| Occupancy and equipment expense | 2,113 | 2,605 | 6,938 | 7,850 | ||||||||||||||||||||||
| Goodwill impairment | — | 12,900 | — | 12,900 | ||||||||||||||||||||||
| Other | 9,725 | 7,205 | 24,456 | 20,960 | ||||||||||||||||||||||
| Total Noninterest Expense | 18,864 | 30,175 | 52,801 | 65,459 | ||||||||||||||||||||||
| Income (Loss) Before Income Taxes | 14,851 | (54,010) | 22,738 | (71,479) | ||||||||||||||||||||||
| Provision (benefit) for income taxes | 2,899 | (9,007) | 4,612 | (13,007) | ||||||||||||||||||||||
| Net Income (Loss) | 11,952 | (45,003) | 18,126 | (58,472) | ||||||||||||||||||||||
| Less: Preferred stock dividends | 582 | 582 | 1,746 | 1,746 | ||||||||||||||||||||||
| Net Income (Loss) Available to Common Shareholders | $ | 11,370 | $ | (45,585) | $ | 16,380 | $ | (60,218) | ||||||||||||||||||
| Per Common Share: | ||||||||||||||||||||||||||
| Earnings (Loss) | $ | 0.69 | $ | (3.01) | $ | 1.01 | $ | (4.45) | ||||||||||||||||||
| Cash dividends paid | $ | 0.01 | $ | 0.01 | $ | 0.03 | $ | 0.03 | ||||||||||||||||||
| Weighted Average Common Shares Outstanding | 16,540,173 | 15,122,702 | 16,223,484 | 13,523,009 | ||||||||||||||||||||||
| See Notes to Consolidated Financial Statements | ||||||||||||||||||||||||||
| FIRST GUARANTY BANCSHARES, INC. AND SUBSIDIARY | ||||||||||||||||||||||||||||||||||||||
| CONSOLIDATED AVERAGE BALANCE SHEETS (unaudited) | ||||||||||||||||||||||||||||||||||||||
| Three Months Ended September 30, 2026 | Three Months Ended September 30, 2025 | |||||||||||||||||||||||||||||||||||||
| (in thousands except for %) | Average Balance | Interest | Yield/Rate (5) | Average Balance | Interest | Yield/Rate (5) | ||||||||||||||||||||||||||||||||
| Assets | ||||||||||||||||||||||||||||||||||||||
| Interest-earning assets: | ||||||||||||||||||||||||||||||||||||||
| Interest-earning deposits with banks | $ | 499,438 | $ | 4,650 | 3.69 | % | $ | 697,288 | $ | 7,777 | 4.42 | % | ||||||||||||||||||||||||||
| Securities (including FHLB stock) | 1,201,873 | 11,797 | 3.89 | % | 722,380 | 6,398 | 3.51 | % | ||||||||||||||||||||||||||||||
| Federal funds sold | 545 | — | — | % | 556 | — | — | % | ||||||||||||||||||||||||||||||
| Loans held for sale | — | — | — | % | — | — | — | % | ||||||||||||||||||||||||||||||
| Loans, net of unearned income (6) | 1,660,955 | 27,423 | 6.55 | % | 2,346,551 | 39,325 | 6.65 | % | ||||||||||||||||||||||||||||||
| Total interest-earning assets | 3,362,811 | $ | 43,870 | 5.18 | % | 3,766,775 | $ | 53,500 | 5.63 | % | ||||||||||||||||||||||||||||
| Noninterest-earning assets: | ||||||||||||||||||||||||||||||||||||||
| Cash and due from banks | 22,023 | 21,031 | ||||||||||||||||||||||||||||||||||||
| Premises and equipment, net | 65,165 | 65,039 | ||||||||||||||||||||||||||||||||||||
| Other assets | 39,742 | 19,419 | ||||||||||||||||||||||||||||||||||||
| Total Assets | $ | 3,489,741 | $ | 3,872,264 | ||||||||||||||||||||||||||||||||||
| Liabilities and Shareholders' Equity | ||||||||||||||||||||||||||||||||||||||
| Interest-bearing liabilities: | ||||||||||||||||||||||||||||||||||||||
| Demand deposits | $ | 898,027 | $ | 7,114 | 3.14 | % | $ | 1,399,102 | $ | 13,185 | 3.74 | % | ||||||||||||||||||||||||||
| Savings deposits | 224,474 | 1,034 | 1.83 | % | 213,383 | 1,058 | 1.97 | % | ||||||||||||||||||||||||||||||
| Time deposits | 1,599,970 | 15,850 | 3.93 | % | 1,362,955 | 14,519 | 4.23 | % | ||||||||||||||||||||||||||||||
Borrowings(7) | 121,989 | 2,221 | 7.22 | % | 186,087 | 2,500 | 5.33 | % | ||||||||||||||||||||||||||||||
| Total interest-bearing liabilities | 2,844,460 | $ | 26,219 | 3.66 | % | 3,161,527 | $ | 31,262 | 3.92 | % | ||||||||||||||||||||||||||||
| Noninterest-bearing liabilities: | ||||||||||||||||||||||||||||||||||||||
| Demand deposits | 385,779 | 405,479 | ||||||||||||||||||||||||||||||||||||
| Other | 28,042 | 41,541 | ||||||||||||||||||||||||||||||||||||
| Total Liabilities | 3,258,281 | 3,608,547 | ||||||||||||||||||||||||||||||||||||
| Shareholders' equity | 231,460 | 263,717 | ||||||||||||||||||||||||||||||||||||
| Total Liabilities and Shareholders' Equity | $ | 3,489,741 | $ | 3,872,264 | ||||||||||||||||||||||||||||||||||
| Net interest income | $ | 17,651 | $ | 22,238 | ||||||||||||||||||||||||||||||||||
| Net interest rate spread (1) | 1.52 | % | 1.71 | % | ||||||||||||||||||||||||||||||||||
| Net interest-earning assets (2) | $ | 518,351 | $ | 605,248 | ||||||||||||||||||||||||||||||||||
| Net interest margin (3), (4), (8) | 2.08 | % | 2.34 | % | ||||||||||||||||||||||||||||||||||
| Average interest-earning assets to interest-bearing liabilities | 118.22 | % | 119.14 | % | ||||||||||||||||||||||||||||||||||
(1)Net interest rate spread represents the difference between the yield on average interest-earning assets and the cost of average interest-bearing liabilities.
(2)Net interest-earning assets represents total interest-earning assets less total interest-bearing liabilities.
(3)Net interest margin represents net interest income divided by average total interest-earning assets.
(4)The tax adjusted net interest margin was 2.10% and 2.35% for the above periods ended September 30, 2026 and 2025 respectively. A 21% tax rate was used to calculate the effect on securities income from tax exempt securities for the above periods ended September 30, 2026 and 2025 respectively.
(5)Annualized.
(6)Includes loan fees of $0.9 million and $1.0 million for the three months ended September 30, 2026 and 2025, respectively.
(7)Includes FHLB prepayment penalty of $0.5 million that resulted in 164 basis points of increased expense for the three months ended September 30, 2026.
(8)The adjusted net interest margin excluding the prepayment penalty was 2.14% for the three months ended September 30, 2026.
| FIRST GUARANTY BANCSHARES, INC. AND SUBSIDIARY | ||||||||||||||||||||||||||||||||||||||
| CONSOLIDATED AVERAGE BALANCE SHEETS (unaudited) | ||||||||||||||||||||||||||||||||||||||
| Nine Months Ended September 30, 2026 | Nine Months Ended September 30, 2025 | |||||||||||||||||||||||||||||||||||||
| (in thousands except for %) | Average Balance | Interest | Yield/Rate (5) | Average Balance | Interest | Yield/Rate (5) | ||||||||||||||||||||||||||||||||
| Assets | ||||||||||||||||||||||||||||||||||||||
| Interest-earning assets: | ||||||||||||||||||||||||||||||||||||||
| Interest-earning deposits with banks | $ | 699,096 | $ | 19,360 | 3.70 | % | $ | 640,961 | $ | 21,287 | 4.44 | % | ||||||||||||||||||||||||||
| Securities (including FHLB stock) | 1,183,465 | 34,274 | 3.87 | % | 683,930 | 17,690 | 3.46 | % | ||||||||||||||||||||||||||||||
| Federal funds sold | 546 | — | — | % | 534 | — | — | % | ||||||||||||||||||||||||||||||
| Loans held for sale | — | — | — | % | 1,131 | — | — | % | ||||||||||||||||||||||||||||||
| Loans, net of unearned income (6) | 1,843,441 | 93,792 | 6.80 | % | 2,476,128 | 123,307 | 6.66 | % | ||||||||||||||||||||||||||||||
| Total interest-earning assets | 3,726,548 | $ | 147,426 | 5.29 | % | 3,802,684 | $ | 162,284 | 5.71 | % | ||||||||||||||||||||||||||||
| Noninterest-earning assets: | ||||||||||||||||||||||||||||||||||||||
| Cash and due from banks | 23,606 | 20,691 | ||||||||||||||||||||||||||||||||||||
| Premises and equipment, net | 64,222 | 66,041 | ||||||||||||||||||||||||||||||||||||
| Other assets | 44,177 | 24,342 | ||||||||||||||||||||||||||||||||||||
| Total Assets | $ | 3,858,553 | $ | 3,913,758 | ||||||||||||||||||||||||||||||||||
| Liabilities and Shareholders' Equity | ||||||||||||||||||||||||||||||||||||||
| Interest-bearing liabilities: | ||||||||||||||||||||||||||||||||||||||
| Demand deposits | $ | 1,062,414 | $ | 24,965 | 3.14 | % | $ | 1,380,225 | $ | 38,097 | 3.69 | % | ||||||||||||||||||||||||||
| Savings deposits | 219,699 | 2,943 | 1.79 | % | 231,206 | 3,656 | 2.11 | % | ||||||||||||||||||||||||||||||
| Time deposits | 1,744,508 | 51,844 | 3.97 | % | 1,403,370 | 45,605 | 4.34 | % | ||||||||||||||||||||||||||||||
| Borrowings | 164,661 | 7,056 | 5.73 | % | 196,267 | 8,225 | 5.60 | % | ||||||||||||||||||||||||||||||
| Total interest-bearing liabilities | 3,191,282 | $ | 86,808 | 3.64 | % | 3,211,068 | $ | 95,583 | 3.98 | % | ||||||||||||||||||||||||||||
| Noninterest-bearing liabilities: | ||||||||||||||||||||||||||||||||||||||
| Demand deposits | 406,474 | 404,640 | ||||||||||||||||||||||||||||||||||||
| Other | 32,960 | 40,306 | ||||||||||||||||||||||||||||||||||||
| Total Liabilities | 3,630,716 | 3,656,014 | ||||||||||||||||||||||||||||||||||||
| Shareholders' equity | 227,837 | 257,744 | ||||||||||||||||||||||||||||||||||||
| Total Liabilities and Shareholders' Equity | $ | 3,858,553 | $ | 3,913,758 | ||||||||||||||||||||||||||||||||||
| Net interest income | $ | 60,618 | $ | 66,701 | ||||||||||||||||||||||||||||||||||
| Net interest rate spread (1) | 1.65 | % | 1.73 | % | ||||||||||||||||||||||||||||||||||
| Net interest-earning assets (2) | $ | 535,266 | $ | 591,616 | ||||||||||||||||||||||||||||||||||
| Net interest margin (3), (4) | 2.17 | % | 2.35 | % | ||||||||||||||||||||||||||||||||||
| Average interest-earning assets to interest-bearing liabilities | 116.77 | % | 118.42 | % | ||||||||||||||||||||||||||||||||||
(1)Net interest rate spread represents the difference between the yield on average interest-earning assets and the cost of average interest-bearing liabilities.
(2)Net interest-earning assets represents total interest-earning assets less total interest-bearing liabilities.
(3)Net interest margin represents net interest income divided by average total interest-earning assets.
(4)The tax adjusted net interest margin was 2.19% and 2.35% for the above periods ended September 30, 2026 and 2025 respectively. A 21% tax rate was used to calculate the effect on securities income from tax exempt securities for the above periods ended September 30, 2026 and 2025 respectively.
(5)Annualized.
(6)Includes loan fees of $3.7 million and $3.9 million for the nine months ended September 30, 2026 and 2025, respectively.
The following table summarizes the components of First Guaranty's loan portfolio as of September 30, 2026, June 30, 2026, March 31, 2026, and December 31, 2025:
| September 30, 2026 | June 30, 2026 | March 31, 2026 | December 31, 2025 | |||||||||||||||||||||||||||||||||||||||||||||||
| (in thousands except for %) | Balance | As % of Category | Balance | As % of Category | Balance | As % of Category | Balance | As % of Category | ||||||||||||||||||||||||||||||||||||||||||
| Real Estate: | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Construction & land development | $ | 65,954 | 4.2 | % | $ | 99,000 | 5.6 | % | $ | 109,758 | 5.7 | % | $ | 149,493 | 7.2 | % | ||||||||||||||||||||||||||||||||||
| Farmland | 30,444 | 1.9 | % | 30,878 | 1.7 | % | 31,377 | 1.6 | % | 32,160 | 1.5 | % | ||||||||||||||||||||||||||||||||||||||
| 1- 4 Family | 388,632 | 24.5 | % | 420,388 | 23.8 | % | 427,518 | 22.2 | % | 428,773 | 20.7 | % | ||||||||||||||||||||||||||||||||||||||
| Multifamily | 72,475 | 4.6 | % | 85,772 | 4.8 | % | 127,973 | 6.6 | % | 144,235 | 6.9 | % | ||||||||||||||||||||||||||||||||||||||
| Non-farm non-residential | 681,905 | 43.0 | % | 790,300 | 44.7 | % | 879,022 | 45.5 | % | 948,536 | 45.7 | % | ||||||||||||||||||||||||||||||||||||||
| Total Real Estate | 1,239,410 | 78.2 | % | 1,426,338 | 80.6 | % | 1,575,648 | 81.6 | % | 1,703,197 | 82.0 | % | ||||||||||||||||||||||||||||||||||||||
| Non-Real Estate: | ||||||||||||||||||||||||||||||||||||||||||||||||||
| Agricultural | 45,524 | 2.9 | % | 42,860 | 2.4 | % | 37,899 | 2.0 | % | 35,244 | 1.7 | % | ||||||||||||||||||||||||||||||||||||||
| Commercial and industrial | 211,994 | 13.4 | % | 222,627 | 12.6 | % | 214,368 | 11.1 | % | 228,738 | 11.0 | % | ||||||||||||||||||||||||||||||||||||||
| Commercial leases | 50,996 | 3.2 | % | 56,619 | 3.2 | % | 71,110 | 3.7 | % | 75,617 | 3.7 | % | ||||||||||||||||||||||||||||||||||||||
| Consumer and other | 37,026 | 2.3 | % | 21,223 | 1.2 | % | 31,070 | 1.6 | % | 33,023 | 1.6 | % | ||||||||||||||||||||||||||||||||||||||
| Total Non-Real Estate | 345,540 | 21.8 | % | 343,329 | 19.4 | % | 354,447 | 18.4 | % | 372,622 | 18.0 | % | ||||||||||||||||||||||||||||||||||||||
| Total loans before unearned income | 1,584,950 | 100.0 | % | 1,769,667 | 100.0 | % | 1,930,095 | 100.0 | % | 2,075,819 | 100.0 | % | ||||||||||||||||||||||||||||||||||||||
| Unearned income | (3,945) | (4,457) | (5,518) | (6,017) | ||||||||||||||||||||||||||||||||||||||||||||||
| Total loans net of unearned income | $ | 1,581,005 | $ | 1,765,210 | $ | 1,924,577 | $ | 2,069,802 | ||||||||||||||||||||||||||||||||||||||||||
The table below sets forth the amounts and categories of our nonperforming assets at the dates indicated.
| (in thousands) | September 30, 2026 | June 30, 2026 | March 31, 2026 | December 31, 2025 | ||||||||||||||||||||||
| Nonaccrual loans: | ||||||||||||||||||||||||||
| Real Estate: | ||||||||||||||||||||||||||
| Construction and land development | $ | 19,060 | $ | 18,823 | $ | 9,466 | $ | 9,281 | ||||||||||||||||||
| Farmland | 2,409 | 2,595 | 2,633 | 2,671 | ||||||||||||||||||||||
| 1- 4 family | 8,005 | 7,593 | 8,865 | 9,768 | ||||||||||||||||||||||
| Multifamily | 6,699 | 2,215 | 2,231 | 2,278 | ||||||||||||||||||||||
| Non-farm non-residential | 5,250 | 7,064 | 21,789 | 24,347 | ||||||||||||||||||||||
| Total Real Estate | 41,423 | 38,290 | 44,984 | 48,345 | ||||||||||||||||||||||
| Non-Real Estate: | ||||||||||||||||||||||||||
| Agricultural | 1,466 | 1,436 | 1,645 | 2,172 | ||||||||||||||||||||||
| Commercial and industrial | 919 | 841 | 1,224 | 2,266 | ||||||||||||||||||||||
| Commercial leases | — | — | 6,483 | 6,640 | ||||||||||||||||||||||
| Consumer and other | 16 | 27 | 73 | 158 | ||||||||||||||||||||||
| Total Non-Real Estate | 2,401 | 2,304 | 9,425 | 11,236 | ||||||||||||||||||||||
| Total nonaccrual loans | 43,824 | 40,594 | 54,409 | 59,581 | ||||||||||||||||||||||
| Loans 90 days and greater delinquent & accruing: | ||||||||||||||||||||||||||
| Real Estate: | ||||||||||||||||||||||||||
| Construction and land development | — | — | — | — | ||||||||||||||||||||||
| Farmland | — | — | — | — | ||||||||||||||||||||||
| 1- 4 family | 161 | — | 107 | 763 | ||||||||||||||||||||||
| Multifamily | — | — | — | — | ||||||||||||||||||||||
| Non-farm non-residential | — | — | 123 | 33 | ||||||||||||||||||||||
| Total Real Estate | 161 | — | 230 | 796 | ||||||||||||||||||||||
| Non-Real Estate: | ||||||||||||||||||||||||||
| Agricultural | — | — | — | — | ||||||||||||||||||||||
| Commercial and industrial | — | — | — | — | ||||||||||||||||||||||
| Commercial leases | — | — | — | — | ||||||||||||||||||||||
| Consumer and other | — | — | — | — | ||||||||||||||||||||||
| Total Non-Real Estate | — | — | — | — | ||||||||||||||||||||||
| Total loans 90 days and greater delinquent & accruing | 161 | — | 230 | 796 | ||||||||||||||||||||||
| Total non-performing loans | 43,985 | 40,594 | 54,639 | 60,377 | ||||||||||||||||||||||
| Real Estate Owned: | ||||||||||||||||||||||||||
| Real Estate Loans: | ||||||||||||||||||||||||||
| Construction and land development | 925 | 1,161 | 1,161 | 8,161 | ||||||||||||||||||||||
| Farmland | — | — | — | — | ||||||||||||||||||||||
| 1- 4 family | 731 | 897 | 851 | 351 | ||||||||||||||||||||||
| Multifamily | — | — | — | — | ||||||||||||||||||||||
| Non-farm non-residential | 26,294 | 27,663 | 26,860 | 26,572 | ||||||||||||||||||||||
| Total Real Estate | 27,950 | 29,721 | 28,872 | 35,084 | ||||||||||||||||||||||
| Non-Real Estate Loans: | ||||||||||||||||||||||||||
| Agricultural | — | — | — | — | ||||||||||||||||||||||
| Commercial and industrial | — | — | — | — | ||||||||||||||||||||||
| Commercial leases | — | — | — | — | ||||||||||||||||||||||
| Consumer and other | — | — | — | — | ||||||||||||||||||||||
| Total Non-Real Estate | — | — | — | — | ||||||||||||||||||||||
| Total Real Estate Owned | 27,950 | 29,721 | 28,872 | 35,084 | ||||||||||||||||||||||
| Total non-performing assets | $ | 71,935 | $ | 70,315 | $ | 83,511 | $ | 95,461 | ||||||||||||||||||
| Non-performing assets to total loans | 4.55 | % | 3.98 | % | 4.34 | % | 4.61 | % | ||||||||||||||||||
| Non-performing assets to total assets | 2.28 | % | 1.81 | % | 2.11 | % | 2.34 | % | ||||||||||||||||||
| Non-performing loans to total loans | 2.78 | % | 2.30 | % | 2.84 | % | 2.92 | % | ||||||||||||||||||
| Nonaccrual loans to total loans | 2.77 | % | 2.30 | % | 2.83 | % | 2.88 | % | ||||||||||||||||||
| Allowance for credit losses to nonaccrual loans | 83.06 | % | 84.49 | % | 70.74 | % | 68.40 | % | ||||||||||||||||||
| Net loan charge-offs to average loans | 0.98 | % | 1.22 | % | 0.99 | % | 3.17 | % | ||||||||||||||||||
The table below lists the Top 10 Nonperforming Assets at September 30, 2026.
| Top 10 Non-Performing Assets | |||||||||||||||||||||||||||||
| Balance | Allocated Reserve | Origination Year | Location | ||||||||||||||||||||||||||
| Asset Description | |||||||||||||||||||||||||||||
| 1 | Independent Living Center OREO | $ | 22,574 | $ | — | 2021 | Louisiana | ||||||||||||||||||||||
| 2 | Assisted Living Center | 11,394 | — | 2023-2025 | Texas | ||||||||||||||||||||||||
| 3 | Commercial Land Development | 7,535 | — | 2023 | Texas | ||||||||||||||||||||||||
| 4 | Apartment Complex | 5,154 | 767 | 2023 | Louisiana | ||||||||||||||||||||||||
| 5 | Apartment Complex | 4,500 | 833 | 2022 | Texas | ||||||||||||||||||||||||
| 6 | Farmland | 2,391 | — | 2020 | Louisiana | ||||||||||||||||||||||||
| 7 | Commercial Building | 1,133 | — | 2023 | West Virginia | ||||||||||||||||||||||||
| 8 | Hotel | 972 | — | 2016 | Louisiana | ||||||||||||||||||||||||
| 9 | Commercial Real Estate | 935 | — | 2017 | Texas | ||||||||||||||||||||||||
| 10 | Retail Strip Center | 833 | 253 | 2016 | Louisiana | ||||||||||||||||||||||||
| $ | 57,421 | $ | 1,853 | ||||||||||||||||||||||||||
| *Excludes bank owned properties previously used as either operating branches or future branch development | |||||||||||||||||||||||||||||
The table below provides a status update as of September 30, 2026 on the previously reported Top 10 Nonperforming Assets in second quarter 2026.
| Top 10 Nonperforming Assets | |||||||||||||||||||||||||||||
| June 30, 2026 | September 30, 2026 | ||||||||||||||||||||||||||||
| Balance | Allocated Reserve | Location | Status | ||||||||||||||||||||||||||
| Asset Description | |||||||||||||||||||||||||||||
| 1 | Independent Living Center OREO | $ | 23,301 | $ | — | Louisiana | Remains in OREO | ||||||||||||||||||||||
| 2 | Assisted Living Center | 10,789 | — | Texas | Remains Nonaccrual | ||||||||||||||||||||||||
| 3 | Commercial Land Development | 7,723 | 73 | Texas | Remains Nonaccrual | ||||||||||||||||||||||||
| 4 | Apartment Complex | 5,181 | 794 | Louisiana | Remains Nonaccrual | ||||||||||||||||||||||||
| 5 | Farmland | 2,391 | — | Louisiana | Remains Nonaccrual | ||||||||||||||||||||||||
| 6 | Hotel | 1,522 | 550 | Louisiana | Remains Nonaccrual / Partially Charged Off | ||||||||||||||||||||||||
| 7 | Commercial Building | 1,175 | — | West Virginia | Remains Nonaccrual | ||||||||||||||||||||||||
| 8 | Commercial Real Estate | 965 | — | Texas | Remains Nonaccrual | ||||||||||||||||||||||||
| 9 | Retail Strip Center | 833 | 5 | Louisiana | Remains Nonaccrual | ||||||||||||||||||||||||
| 10 | Mobile Home Park OREO | 831 | — | New Mexico | Remains in OREO | ||||||||||||||||||||||||
| $ | 54,711 | $ | 1,422 | ||||||||||||||||||||||||||
| *Excludes bank owned properties previously used as either operating branches or future branch development | |||||||||||||||||||||||||||||
The tables below list the top 10 special mention and substandard relationships as of September 30, 2026.
| Top 10 Special Mention Relationships | |||||||||||||||||||||||||||||
| Balance | Allocated Reserve | Origination Year(s) | Location | ||||||||||||||||||||||||||
| Relationship Description | |||||||||||||||||||||||||||||
| 1 | Assisted Living Facility | $ | 33,467 | $ | — | 2022 | Alabama | ||||||||||||||||||||||
| 2 | Warehouse Facility | 16,040 | — | 2011 | Louisiana & Tennessee | ||||||||||||||||||||||||
| 3 | Recreational Park | 15,399 | — | 2020 | Louisiana | ||||||||||||||||||||||||
| 4 | Hotel Property | 14,458 | — | 2023 | Florida | ||||||||||||||||||||||||
| 5 | Multipurpose Commercial Real Estate Building | 7,211 | — | 2021 | Texas | ||||||||||||||||||||||||
| 6 | Multifamily | 4,893 | — | 2022 | Florida | ||||||||||||||||||||||||
| 7 | Hotel Property | 4,585 | — | 2023 | Georgia | ||||||||||||||||||||||||
| 8 | Construction of Resort/Condos | 4,060 | — | 2022 | West Virginia | ||||||||||||||||||||||||
| 9 | Multi Tenant Office Building | 3,719 | — | 2022 | California | ||||||||||||||||||||||||
| 10 | Residential Real Estate Developer | 3,278 | — | 2020-2022 | Louisiana | ||||||||||||||||||||||||
| $ | 107,110 | $ | — | ||||||||||||||||||||||||||
| Top 10 Substandard Relationships | |||||||||||||||||||||||||||||
| Balance | Allocated Reserve | Origination Year(s) | Location | ||||||||||||||||||||||||||
| Relationship Description | |||||||||||||||||||||||||||||
| 1 | Medical Facilities | $ | 45,035 | $ | — | 2008-2022 | Louisiana | ||||||||||||||||||||||
| 2 | Manufacturing Company | 33,672 | — | 2015-2024 | Louisiana | ||||||||||||||||||||||||
| 3 | Owner Occupied Office Building | 30,227 | — | 2023 | Utah | ||||||||||||||||||||||||
| 4 | Commercial Retail Shopping Center | 13,080 | — | 2020-2022 | Oklahoma | ||||||||||||||||||||||||
| 5 | Food Processor | 11,999 | — | 2022-2024 | Ohio | ||||||||||||||||||||||||
| 6 | Assisted Living Facility | 11,394 | — | 2023-2025 | Texas | ||||||||||||||||||||||||
| 7 | Gas Station & Convenience Store | 11,370 | — | 2023 | Louisiana | ||||||||||||||||||||||||
| 8 | Commercial Land Development | 7,535 | — | 2023 | Texas | ||||||||||||||||||||||||
| 9 | Timber & Logging | 6,914 | — | 2022-2024 | Louisiana | ||||||||||||||||||||||||
| 10 | Real Estate Properties | 6,204 | — | 2021-2024 | Louisiana | ||||||||||||||||||||||||
| $ | 177,430 | $ | — | ||||||||||||||||||||||||||
The following table presents, for the periods indicated, the major categories of other noninterest expense:
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||
| (in thousands) | 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||||
| Other noninterest expense: | ||||||||||||||||||||||||||
| Legal and professional fees | $ | 806 | $ | 988 | $ | 2,286 | $ | 2,747 | ||||||||||||||||||
| Data processing | 335 | 336 | 1,025 | 1,022 | ||||||||||||||||||||||
| ATM fees | 378 | 390 | 1,080 | 1,242 | ||||||||||||||||||||||
| Marketing and public relations | 182 | 151 | 593 | 555 | ||||||||||||||||||||||
| Taxes - sales, capital, and franchise | 518 | 542 | 1,552 | 1,585 | ||||||||||||||||||||||
| Operating supplies | 40 | 66 | 151 | 152 | ||||||||||||||||||||||
| Software expense and amortization | 1,160 | 1,211 | 3,569 | 3,615 | ||||||||||||||||||||||
| Travel and lodging | 97 | 88 | 279 | 286 | ||||||||||||||||||||||
| Telephone | 116 | 88 | 302 | 283 | ||||||||||||||||||||||
| Amortization of core deposit intangibles | 794 | 174 | 1,142 | 522 | ||||||||||||||||||||||
| Donations | 57 | 51 | 210 | 191 | ||||||||||||||||||||||
| Net costs from other real estate and repossessions | 2,047 | 13 | 2,945 | 87 | ||||||||||||||||||||||
| Regulatory assessment | 1,692 | 1,777 | 5,308 | 4,930 | ||||||||||||||||||||||
| Other | 1,503 | 1,330 | 4,014 | 3,743 | ||||||||||||||||||||||
| Total other noninterest expense | $ | 9,725 | $ | 7,205 | $ | 24,456 | $ | 20,960 | ||||||||||||||||||
The following table presents, for the periods indicated, the major categories of other noninterest expense:
| Three Months Ended September 30, | Three Months Ended June 30, | Three Months Ended March 31, | Three Months Ended December 31, | |||||||||||||||||||||||
| (in thousands) | 2026 | 2026 | 2026 | 2025 | ||||||||||||||||||||||
| Other noninterest expense: | ||||||||||||||||||||||||||
| Legal and professional fees | $ | 806 | $ | 787 | $ | 693 | $ | 665 | ||||||||||||||||||
| Data processing | 335 | 365 | 325 | 331 | ||||||||||||||||||||||
| ATM fees | 378 | 344 | 358 | 432 | ||||||||||||||||||||||
| Marketing and public relations | 182 | 189 | 222 | 174 | ||||||||||||||||||||||
| Taxes - sales, capital, and franchise | 518 | 518 | 516 | 237 | ||||||||||||||||||||||
| Operating supplies | 40 | 39 | 72 | 48 | ||||||||||||||||||||||
| Software expense and amortization | 1,160 | 1,237 | 1,172 | 1,289 | ||||||||||||||||||||||
| Travel and lodging | 97 | 127 | 55 | 133 | ||||||||||||||||||||||
| Telephone | 116 | 92 | 94 | 91 | ||||||||||||||||||||||
| Amortization of core deposit intangibles | 794 | 174 | 174 | 174 | ||||||||||||||||||||||
| Donations | 57 | 86 | 67 | 33 | ||||||||||||||||||||||
| Net costs from other real estate and repossessions | 2,047 | 530 | 368 | 815 | ||||||||||||||||||||||
| Regulatory assessment | 1,692 | 1,808 | 1,808 | 1,778 | ||||||||||||||||||||||
| Other | 1,503 | 1,522 | 989 | 1,437 | ||||||||||||||||||||||
| Total other noninterest expense | $ | 9,725 | $ | 7,818 | $ | 6,913 | $ | 7,637 | ||||||||||||||||||
Non-GAAP Financial Measures
Our accounting and reporting policies conform to accounting principles generally accepted in the United States, or GAAP, and the prevailing practices in the banking industry. However, we also evaluate our performance based on certain additional metrics. Tangible book value per share and the ratio of tangible equity to tangible assets are not financial measures recognized under GAAP and, therefore, are considered non-GAAP financial measures.
Our management, banking regulators, many financial analysts and other investors use these non-GAAP financial measures to compare the capital adequacy of banking organizations with significant amounts of preferred equity and/or goodwill or other intangible assets, which typically stem from the use of the purchase accounting method of accounting for mergers and acquisitions. Tangible equity, tangible assets, tangible book value per share or related measures should not be considered in isolation or as a substitute for total shareholders' equity, total assets, book value per share or any other measure calculated in accordance with GAAP. Moreover, the manner in which we calculate tangible equity, tangible assets, tangible book value per share and any other related measures may differ from that of other companies reporting measures with similar names.
The following table reconciles, as of the dates set forth below, shareholders' equity (on a GAAP basis) to tangible equity and total assets (on a GAAP basis) to tangible assets and calculates our tangible book value per share.
| At September 30, | At December 31, | |||||||||||||||||||||||||||||||
| (in thousands except for share data and %) | 2026 | 2025 | 2024 | 2023 | 2022 | |||||||||||||||||||||||||||
| Tangible Common Equity | ||||||||||||||||||||||||||||||||
| Total shareholders' equity | $ | 218,945 | $ | 226,218 | $ | 255,049 | $ | 249,631 | $ | 234,991 | ||||||||||||||||||||||
| Adjustments: | ||||||||||||||||||||||||||||||||
| Preferred | 33,058 | 33,058 | 33,058 | 33,058 | 33,058 | |||||||||||||||||||||||||||
| Goodwill | — | — | 12,900 | 12,900 | 12,900 | |||||||||||||||||||||||||||
| Acquisition intangibles | 1,124 | 2,266 | 2,962 | 3,658 | 4,355 | |||||||||||||||||||||||||||
| Other intangibles | 100 | 100 | 100 | 100 | — | |||||||||||||||||||||||||||
| Tangible common equity | $ | 184,663 | $ | 190,794 | $ | 206,029 | $ | 199,915 | $ | 184,678 | ||||||||||||||||||||||
Common shares outstanding | 16,638,371 | 15,793,433 | 12,504,717 | 12,475,424 | 10,716,796 | |||||||||||||||||||||||||||
Book value per common share | $ | 11.17 | $ | 12.23 | $ | 17.75 | $ | 17.36 | $ | 18.84 | ||||||||||||||||||||||
Tangible book value per common share | $ | 11.10 | $ | 12.08 | $ | 16.48 | $ | 16.03 | $ | 17.23 | ||||||||||||||||||||||
| Tangible Assets | ||||||||||||||||||||||||||||||||
| Total Assets | $ | 3,152,485 | $ | 4,078,321 | $ | 3,972,728 | $ | 3,552,772 | $ | 3,151,347 | ||||||||||||||||||||||
| Adjustments: | ||||||||||||||||||||||||||||||||
| Goodwill | — | — | 12,900 | 12,900 | 12,900 | |||||||||||||||||||||||||||
| Acquisition intangibles | 1,124 | 2,266 | 2,962 | 3,658 | 4,355 | |||||||||||||||||||||||||||
| Other intangibles | 100 | 100 | 100 | 100 | — | |||||||||||||||||||||||||||
| Tangible Assets | $ | 3,151,261 | $ | 4,075,955 | $ | 3,956,766 | $ | 3,536,114 | $ | 3,134,092 | ||||||||||||||||||||||
| Tangible common equity to tangible assets | 5.86 | % | 4.68 | % | 5.21 | % | 5.65 | % | 5.89 | % | ||||||||||||||||||||||
Regulatory Capital
Risk-based capital regulations adopted by the FDIC require banks to achieve and maintain specified ratios of capital to risk-weighted assets. Similar capital regulations apply to bank holding companies over $3.0 billion in assets. The risk-based capital rules are designed to measure "Tier 1" capital (consisting of common equity, retained earnings and a limited amount of qualifying perpetual preferred stock and trust preferred securities, net of goodwill and other intangible assets and accumulated other comprehensive income) and total capital in relation to the credit risk of both on- and off- balance sheet items. Under the guidelines, one of its risk weights is applied to the different on-balance sheet items. Off-balance sheet items, such as loan commitments, are also subject to risk weighting. Applicable bank holding companies and all banks must maintain a minimum total capital to total risk weighted assets ratio of 8.00%, at least half of which must be in the form of core or Tier 1 capital. These guidelines also specify that bank holding companies that are experiencing internal growth or making acquisitions will be expected to maintain capital positions substantially above the minimum supervisory levels.
In order to avoid limitations on distributions, including dividend payments, and certain discretionary bonus payments to executive officers, an institution must hold a capital conservation buffer above its minimum risk-based capital requirements. As of September 30, 2026, the Bank's capital conservation buffer was 10.79% exceeding the minimum of 2.50%. As of September 30, 2026, First Guaranty's capital conservation buffer was 8.91% exceeding the minimum of 2.50%.
As a result of the Economic Growth, Regulatory Relief, and Consumer Protection Act, the Federal Reserve Board has amended its small bank holding company and savings and loan holding company policy statement to provide that holding companies with consolidated assets of less than $3 billion that are (i) not engaged in significant nonbanking activities, (ii) do not conduct significant off-balance sheet activities, and (iii) do not have a material amount of SEC-registered debt or equity securities, other than trust preferred securities, that contribute to an organization's complexity, are no longer subject to regulatory capital requirements, effective August 30, 2018. On January 1, 2024, First Guaranty ceased being considered a "small bank holding company". Accordingly, both the Bank and First Guaranty are required to maintain specified ratios of capital to risk-weighted assets.
In addition, as a result of the legislation, the federal banking agencies have developed a "Community Bank Leverage Ratio" (the ratio of a bank's Tier 1 capital to average total consolidated assets) for financial institutions with assets of less than $10 billion. A "qualifying community bank" that exceeds this ratio will be deemed to be in compliance with all other capital and leverage requirements, including the capital requirements to be considered "well capitalized" under Prompt Corrective Action statutes. The federal banking agencies may consider a financial institution's risk profile when evaluating whether it qualifies as a community bank for purposes of the capital ratio requirement. In April 2026, the federal banking agencies finalized a rule lowering the Community Bank Leverage Ratio to 8%, effective July 1, 2026. As of September 30, 2026, the Bank has not elected to follow the Community Bank Leverage Ratio.
At September 30, 2026, First Guaranty and the Bank each satisfied the minimum numerical capital ratio thresholds to be considered well capitalized under applicable federal regulatory requirements. However, because the Consent Order requires the Bank to meet and maintain specific capital levels, the Bank may not be considered well capitalized for purposes of the prompt corrective action framework while the Consent Order remains in effect, even if its capital ratios otherwise exceed the applicable numerical thresholds. As a bank holding company, First Guaranty’s financial condition and liquidity may be adversely affected by any limitations on the Bank’s regulatory capital status, operations, dividends or funding sources. Although the Consent Order does not directly impose capital requirements on First Guaranty, the Bank’s regulatory standing may adversely affect First Guaranty’s liquidity, regulatory standing and its ability in engage in certain activities.
| "Well Capitalized Minimums" | As of September 30, 2026 | As of December 31, 2025 | ||||||||||||||||||
| Tier 1 Leverage Ratio | ||||||||||||||||||||
| Bank | 5.00% | 8.29% | 6.90% | |||||||||||||||||
| Consolidated | N/A | 7.30% | 5.93% | |||||||||||||||||
| Tier 1 Risk-based Capital Ratio | ||||||||||||||||||||
| Bank | 8.00% | 17.53% | 12.24% | |||||||||||||||||
| Consolidated | 6.00% | 15.41% | 10.52% | |||||||||||||||||
| Total Risk-based Capital Ratio | ||||||||||||||||||||
| Bank | 10.00% | 18.79% | 13.48% | |||||||||||||||||
| Consolidated | 10.00% | 18.48% | 13.12% | |||||||||||||||||
| Common Equity Tier One Capital Ratio | ||||||||||||||||||||
| Bank | 6.50% | 17.53% | 12.24% | |||||||||||||||||
| Consolidated | N/A | 13.42% | 9.03% | |||||||||||||||||
EXHIBIT 99.2
OCTOBER 27, 2026
NEWS FOR IMMEDIATE RELEASE
CONTACT: ERIC J. DOSCH, CFO
985.375.0308
Dear shareholders,
“We continue to move forward with our strategy to reduce balance sheet risk, improve earnings, and grow capital, and the third quarter of 2026 marked meaningful progress on each of these priorities.
“On July 31, 2026, we completed the sale of our Texas operations to Armstrong Bank. We estimate the sale contributed approximately $17.6 million pre-tax and helped produce net income of $12.0 million for the quarter. As we look toward year-end, I want to update you on our progress under the Consent Order and expand on our continuing strategy.
“In August, First Guaranty Bank entered into a Consent Order with the FDIC and the Louisiana Office of Financial Institutions. Our board and management team are fully committed to meeting every provision of the Order, and we have acted quickly. The Order requires the Bank to maintain a Tier 1 leverage ratio of at least 9.0% and a total risk-based capital ratio of at least 14.0%. During the third quarter, we:
•prepaid $135.0 million of FHLB advances,
•used the one-way sell feature of our reciprocal deposit program to reduce surplus cash and deposits by $291.4 million, and
•redeemed $130.6 million of brokered deposits with surplus cash.
“As a result, the Bank’s Tier 1 leverage ratio rose to 8.29% at September 30, 2026, up from 7.10% at June 30, 2026. That reported ratio is based on average assets for the full quarter. The Bank’s total average assets were $3.5 billion. Because we completed these actions over the course of the quarter, it does not yet fully reflect our smaller balance sheet. Measured against the $3.2 billion average assets for September alone, the Bank's Tier 1 leverage ratio exceeded 9.0%. We expect the Bank's reported Tier 1 leverage ratio to exceed 9.0% at December 31, 2026. The Bank's total risk-based capital ratio was 18.79%, well above the 14.0% the Order requires.
“We have put corrective measures in place for:
•commercial real estate stress testing,
•debt service coverage standards,
•watch list management,
•credit risk grading, and
•loans with supervisory loan-to-value exceptions.
“We remain focused on reducing our non-performing, classified, and special mention assets.
“First Guaranty signed a sales agreement to sell our largest non-performing asset, an independent living center that makes up approximately 80% of our OREO balance. The property's book balance is $22.6 million after a $0.7 million write-down in the quarter. We expect the sale to close in the fourth quarter of 2026. The property's operating expenses were $0.3 million in the third quarter. We also wrote down former and planned branch properties by $0.8 million. The largest of these, a $1.9 million facility, is under contract, with the sale expected in the fourth quarter of 2026.
“First Guaranty has signed a letter of intent to sell our second largest non-performing asset, an assisted living center located in Texas. This loan totals $11.4 million. The transaction is anticipated to close in the fourth quarter of 2026.
“We will continue to report on our top 10 largest non-performing assets and our top 10 substandard and special mention relationships. Because these few relationships drive the overall portfolio balances, a change in just a few loans significantly improves our loan portfolio. Substandard assets declined $31.2 million in the third quarter. Since December 31, 2025, special mention loans have declined $191.4 million and substandard loans have declined $102.2 million.
“Our internal guidance is to reduce adversely classified assets to less than 30% of the Bank's total regulatory capital. Our current ratio is 84%. We have come a long way in managing credit risk. The Bank's total risk-based capital ratio improved to 18.79% at September 30, 2026, from 11.28% at June 30, 2024. Our internal guidance of 14% or higher for this ratio is consistent with the
Consent Order. Our commercial real estate concentration fell to approximately 199% of the Bank's Tier 1 capital plus allowance for credit losses at September 30, 2026, well below regulatory guidance.
“Senior management has a plan for each adversely classified asset with a balance over $2.0 million. We are working with our customers to improve their risk ratings or, in several cases, to refinance with another financial institution.
“Our internal and external loan reviews continue to evaluate credits rigorously. The senior management loan committee must unanimously approve new loans over $1.5 million. The lending team is building a more diversified loan portfolio with smaller credits than we originated in the past. We believe this strategy reduces future credit risk and leads to broader customer relationships. Our lending team originated approximately $35 million in new loan funding in the third quarter of 2026. We expect to grow our new loan portfolio in the coming quarters. Our developing loan pipeline is strong.
“We continue to bring our balance sheet in line with our core funding base to improve our margins and our Tier 1 leverage ratio. Total assets were $3.2 billion at September 30, 2026, compared with $4.1 billion at December 31, 2025. Our laddered brokered deposits that mature in 2026 and 2027 give First Guaranty flexibility to keep reducing wholesale funding as they mature. This will help us improve our net interest margin going forward.
“First Guaranty provides essential banking services for our local communities. I look forward to leading us as we achieve our goal to be the premier community bank for the markets we serve in Louisiana, Kentucky and West Virginia."
Sincerely,
| /s/ Michael R. Mineer | ||
| Michael R. Mineer | ||
| President and Chief Executive Officer | ||