FBIZ First Business Financial Services Inc

 

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): January 30, 2025

 

 

First Business Financial Services, Inc.

(Exact name of Registrant as Specified in Its Charter)

 

 

Wisconsin			001-34095	39-1576570
(State or Other Jurisdiction of Incorporation)			(Commission File Number)	(IRS Employer Identification No.)
401 Charmany Drive
Madison, Wisconsin				53719
(Address of Principal Executive Offices)				(Zip Code)

 

Registrant’s Telephone Number, Including Area Code: 608 238-8008

 

N/A

(Former Name or Former Address, if Changed Since Last Report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

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

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock, $0.01 par value		FBIZ		The Nasdaq Stock Market LLC

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. ☐

 

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Item 2.02 Results of Operations and Financial Condition.

On January 30, 2025, First Business Financial Services, Inc. (the “Company”) announced its earnings for the quarter ended December 31, 2024. A copy of the Company’s press release containing this information is being “furnished” as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference.

Item 7.01 Regulation FD Disclosure.

 

On January 30, 2025, the Company posted an investor presentation to its website www.firstbusiness.bank under the “Investor Relations” tab. The information included in the presentation provides an overview of the Company’s recent operating performance, financial condition, and business strategy. The Company intends to use this presentation in connection with its fourth quarter 2024 earnings call to be held at 1:00 p.m. Central time on January 31, 2025, and from time to time when the Company's executives interact with shareholders, analysts, and other third parties. A copy of the registrant’s presentation is attached hereto as Exhibit 99.2 to this Current Report on Form 8-K and is incorporated herein by reference.

 

The information in Items 2.02 and 7.01 of this Current Report on Form 8-K and Exhibits 99.1 and 99.2 attached hereto is being “furnished” and will not, except to the extent required by applicable law or regulation, be deemed “filed” by the Company for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section, nor will any of such information or exhibits be deemed incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, except as expressly set forth by specific reference in such filing.

 

 

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

The following exhibit is being “furnished” as part of this Current Report on Form 8-K:

99.1		Press release of the registrant dated January 30, 2025, containing financial information for its quarter ended December 31, 2024.
99.2		Slides from Fourth Quarter 2024 Investor Presentation

 

104		Cover Page Interactive Data File (embedded within the Inline XBRL Document)

 

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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.

January 30, 2025				FIRST BUSINESS FINANCIAL SERVICES, INC.
				By:		/s/ Brian D. Spielmann
				Name:		Brian D. Spielmann
				Title:		Chief Financial Officer

 

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FIRST BUSINESS BANK REPORTS RECORD FOURTH QUARTER 2024 NET INCOME OF $14.2 MILLION

-- Record operating revenue, strong net interest margin, and positive operating leverage drive record pre-tax, pre-provision earnings --

MADISON, Wis., January 30, 2025 (BUSINESS WIRE) -- First Business Financial Services, Inc. (the “Company”, the “Bank”, or “First Business Bank”) (Nasdaq:FBIZ) reported quarterly net income available to common shareholders of $14.2 million, or earnings per share ("EPS") of $1.71. This compares to net income available to common shareholders of $10.3 million, or $1.24 per share, in the third quarter of 2024 and $9.6 million, or $1.15 per share, in the fourth quarter of 2023. EPS for the fourth quarter of 2024 included tax and Small Business Administration ("SBA") recourse reserve benefits totaling $0.28 per share.

“First Business Bank’s excellent execution throughout 2024 culminated in outstanding fourth quarter performance,” said Corey Chambas, Chief Executive Officer. “Our success is attributable to our deep client relationships and exceptional team, who produced near 10% loan growth once again. At the same time, we are very pleased with the 13% expansion of fee income in the fourth quarter, which helped drive an improved efficiency ratio. Excluding the tax and recourse benefits in the quarter, our earnings per share amounted to $1.43, marking growth of 15% and 24% from the linked and prior year quarters and supporting our key focus on meaningful tangible book value expansion. We remain confident in our ability to execute our strategic plan and achieve 10% balance sheet and top line revenue growth in 2025.”

Quarterly Highlights

 

 

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Quarterly Financial Results

 

(Unaudited)		As of and for the Three Months Ended						As of and for the Year Ended
(Dollars in thousands, except per share amounts)		December 31, 2024		September 30, 2024		December 31, 2023		December 31, 2024		December 31, 2023
Net interest income		$33,148		$31,007		$29,540		$124,206		$112,588
Adjusted non-interest income (1)		8,005		7,064		7,094		29,259		31,353
Operating revenue (1)		41,153		38,071		36,634		153,465		143,941
Operating expense (1)		23,434		22,630		21,374		93,016		87,787
Pre-tax, pre-provision adjusted earnings (1)		17,719		15,441		15,260		60,449		56,154
Less:
Provision for credit losses		2,701		2,087		2,573		8,827		8,182
Net loss on repossessed assets		5		11		4		168		13
SBA recourse (benefit) provision		(687)		466		210		(104)		775
Impairment of tax credit investments		400		—		—		400		—
Add:
Net loss on sale of securities		—		—		—		(8)		(45)
Income before income tax expense		15,300		12,877		12,473		51,150		47,139
Income tax expense		885		2,351		2,703		6,905		10,112
Net income		$14,415		$10,526		$9,770		$44,245		$37,027
Preferred stock dividends		219		218		219		875		875
Net income available to common shareholders		$14,196		$10,308		$9,551		$43,370		$36,152
Earnings per share, diluted		$1.71		$1.24		$1.15		$5.20		$4.33
Book value per share		$38.17		$36.17		$33.39		$38.17		$33.39
Tangible book value per share (1)		$36.74		$34.74		$31.94		$36.74		$31.94
Net interest margin (2)		3.77%		3.64%		3.69%		3.66%		3.78%
Adjusted net interest margin (1)(2)		3.48%		3.51%		3.50%		3.47%		3.62%
Fee income ratio (non-interest income / total revenue)		19.45%		18.55%		19.36%		19.06%		21.76%
Efficiency ratio (1)		56.94%		59.50%		58.34%		60.61%		60.99%
Return on average assets (2)		1.52%		1.13%		1.11%		1.20%		1.13%
Return on average tangible common equity (2)		19.21%		14.40%		14.64%		15.35%		14.45%
Period-end loans and leases receivable		$3,113,128		$3,050,079		$2,850,261		$3,113,128		$2,850,261
Average loans and leases receivable		$3,103,703		$3,031,880		$2,810,793		$2,996,881		$2,647,851
Period-end core deposits		$2,396,429		$2,382,730		$2,339,071		$2,396,429		$2,339,071
Average core deposits		$2,416,919		$2,375,002		$2,247,639		$2,378,465		$2,098,153
Allowance for credit losses, including unfunded commitment reserves		$37,268		$35,509		$32,997		$37,268		$32,997
Non-performing assets		$28,418		$19,420		$20,844		$28,418		$20,844
Allowance for credit losses as a percent of total gross loans and leases		1.20%		1.16%		1.16%		1.20%		1.16%
Non-performing assets as a percent of total assets		0.74%		0.52%		0.59%		0.74%		0.59%

 

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Fourth Quarter 2024 Compared to Third Quarter 2024

Net interest income increased $2.1 million, or 6.9%, to $33.1 million.

The Bank reported a provision expense of $2.7 million, compared to $2.1 million in the third quarter of 2024. The increase was driven by new specific reserves and charge-offs in the Commercial and Industrial ("C&I") loan portfolio, partially offset by decreases in general reserves primarily related to the annual review of model assumptions for both qualitative and quantitative factors.

Non-interest income increased $941,000, or 13.3%, to $8.0 million.

 

 

 

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Non-interest expense increased $45,000, or 0.2%, to $23.2 million, while operating expense increased $804,000, or 3.6%, to $23.4 million.

Income tax expense decreased $1.5 million, or 62.4%, to $885,000. The effective tax rate was 5.8% for the three months ended December 31, 2024, compared to 18.3% for the linked quarter. The decrease is primarily due to a $1.7 million, or $0.21 after tax per share, partial release of a state deferred tax asset valuation allowance due to changes in projected taxable income based on revised state taxation guidance and 2023 state tax return actual results. The Company expects to report an effective tax rate between 16% and 18% for 2025.

Total period-end loans and leases receivable increased $63.6 million, or 8.3% annualized, to $3.114 billion. The average rate earned on average loans and leases receivable was 7.21%, down 11 basis points from 7.32% in the prior quarter. Excluding fees in lieu of interest, the average rate earned on average loans and leases receivable was 6.91%, down 29 basis points from 7.19% in the prior quarter. This decrease in yield was primarily due to the decrease in short-term market rates.

Total period-end core deposits increased $13.7 million, or 2.3% annualized, to $2.396 billion, compared to $2.383 billion. The average rate paid was 2.98%, down 36 basis points from 3.34% in the prior quarter.

Period-end wholesale funding, including FHLB advances and brokered deposits, increased $94.4 million, or 10.7%, to $976.1 million. Consistent with the Bank’s long-held philosophy to minimize exposure to interest rate risk, management will continue to utilize the most efficient and cost-effective source of wholesale funds to match-fund fixed-rate loans as necessary.

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Non-performing assets increased $9.0 million to $28.4 million, or 0.74% of total assets, increasing as a percentage of total assets from 0.52% in the prior quarter. The increase is primarily driven by a conventional C&I loan that management identified as non-performing and recognized a specific reserve. We continue to expect full repayment of the previously disclosed Asset-Based Lending ("ABL") loan that defaulted during the second quarter of 2023. The liquidation process under Chapter 7 bankruptcy has delayed final resolution. Through the Bank's collection efforts, the current balance of this loan is $6.2 million, down from $8.8 million in the prior- year quarter. Excluding this ABL loan, non-performing assets totaled $22.2 million, or 0.58% of total assets in the current quarter and $13.0 million, or 0.35% of total assets in the linked quarter.

The allowance for credit losses, including the unfunded credit commitments reserve, increased $1.8 million, or 5.0%, as increases in new specific reserves and loan growth were partially offset by net charge-offs and changes in quantitative and qualitative factors. The allowance for credit losses, including unfunded credit commitment reserves, as a percent of total gross loans and leases was 1.20% compared to 1.16% in the prior quarter.

Fourth Quarter 2024 Compared to Fourth Quarter 2023

Net interest income increased $3.6 million, or 12.2%, to $33.1 million.

The Company reported a credit loss provision expense of $2.7 million, compared to $2.6 million in the fourth quarter of 2023. See the provision breakdown table below for more detail on the components of provision expense.

Non-interest income increased $911,000, or 12.8%, to $8.0 million.

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Non-interest expense increased $1.6 million, or 7.2%, to $23.2 million. Operating expense increased $2.1 million, or 9.6%, to $23.4 million.

Total period-end loans and leases receivable increased $263.8 million, or 9.3%, to $3.114 billion.

Total period-end core deposits grew $57.4 million, or 2.5%, to $2.396 billion, and the average rate paid decreased 22 basis points to 2.98%. The decrease in average rate paid on core deposits was primarily due to a decrease in short-term market rates. Total average core deposits grew $169.3 million, or 7.5%, to $2.417 billion.

Period-end wholesale funding increased $263.9 million, or 32.0%, to $976.1 million.

Non-performing assets increased to $28.4 million, or 0.74% of total assets, compared to $20.8 million, or 0.59% of total assets, driven by a conventional C&I loan and new past-due Equipment Finance loans within the C&I portfolio. Excluding the ABL loan described above for which we expect full repayment, non-performing assets totaled $22.2 million, or 0.58% of total assets and $12.0 million, or 0.34% of total assets in the prior year quarter.

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The allowance for credit losses, including unfunded commitment reserves, increased $4.3 million to $37.3 million, compared to $33.0 million primarily due to an increase in specific reserves and loan growth, partially offset by net charge-offs and changes in general reserve. The allowance for credit losses as a percent of total gross loans and leases was 1.20%, compared 1.16% in the prior year.

Investor Presentation and Conference Call

On January 30, 2025, the Company posted an investor presentation to its website firstbusiness.bank under the “Investor Relations” tab which will also be furnished to the U.S. Securities and Exchange Commission on January 30, 2025. The information included in the presentation provides an overview of the Company’s recent operating performance, financial condition, and business strategy. The Company intends to use this presentation in connection with its fourth quarter 2024 earnings call to be held at 1:00 p.m. Central time on January 31, 2025, and from time to time when the Company's executives interact with shareholders, analysts, and other third parties. The conference call can be accessed at 800-549-8228 (289-819-1520 if outside the United States and Canada), using the conference call access code: FBIZ. Investors may also listen live via webcast at: https://events.q4inc.com/attendee/585942928. A replay of the call will be available through Friday, February 7, 2025, by calling 888-660-6264 or 289-819-1325 for international participants. The webcast archive of the conference call will be available on the Company’s website, ir.firstbusiness.bank.

About First Business Bank

First Business Bank® specializes in Business Banking, including Commercial Banking and Specialty Finance, Private Wealth, and Bank Consulting services, and through its refined focus delivers unmatched expertise, accessibility, and responsiveness. Specialty Finance solutions are delivered through First Business Bank’s wholly owned subsidiary First Business Specialty Finance, LLC®. First Business Bank is a wholly owned subsidiary of First Business Financial Services, Inc®. (Nasdaq: FBIZ). For additional information, visit firstbusiness.bank.

This release may include forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995, which reflect First Business Bank’s current views with respect to future events and financial performance. Forward-looking statements are not based on historical information, but rather are related to future operations, strategies, financial results, or other developments. Forward-looking statements are based on management’s expectations as well as certain assumptions and estimates made by, and information available to, management at the time the statements are made. Those statements are based on general assumptions and are subject to various risks, uncertainties, and other factors that may cause actual results to differ materially from the views, beliefs, and projections expressed in such statements. Such statements are subject to risks and uncertainties, including among other things:

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For further information about the factors that could affect the Company’s future results, please see the Company’s annual report on Form 10-K for the year ended December 31, 2023, and other filings with the Securities and Exchange Commission.

 

CONTACT:		First Business Financial Services, Inc.
		Brian D. Spielmann
		Chief Financial Officer
		608-232-5977
		bspielmann@firstbusiness.bank

 

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SELECTED FINANCIAL CONDITION DATA

 

(Unaudited)		As of
(in thousands)		December 31, 2024		September 30, 2024		June 30, 2024		March 31, 2024		December 31, 2023
Assets
Cash and cash equivalents		$157,702		$131,972		$81,080		$72,040		$139,510
Securities available-for-sale, at fair value		341,392		313,336		308,852		314,114		297,006
Securities held-to-maturity, at amortized cost		6,741		6,907		7,082		8,131		8,503
Loans held for sale		13,498		8,173		6,507		4,855		4,589
Loans and leases receivable		3,113,128		3,050,079		2,985,414		2,910,864		2,850,261
Allowance for credit losses		(35,785)		(33,688)		(33,088)		(32,799)		(31,275)
Loans and leases receivable, net		3,077,343		3,016,391		2,952,326		2,878,065		2,818,986
Premises and equipment, net		5,227		5,478		6,381		6,268		6,190
Repossessed assets		51		56		54		317		247
Right-of-use assets		5,702		5,789		6,041		6,297		6,559
Bank-owned life insurance		57,210		56,767		56,351		55,948		55,536
Federal Home Loan Bank stock, at cost		11,616		12,775		11,901		13,326		12,042
Goodwill and other intangible assets		11,912		11,834		11,841		11,950		12,023
Derivatives		65,762		42,539		70,773		69,703		55,597
Accrued interest receivable and other assets		99,059		103,707		97,872		90,344		91,058
Total assets		$3,853,215		$3,715,724		$3,617,061		$3,531,358		$3,507,846
Liabilities and Stockholders’ Equity
Core deposits		$2,396,429		$2,382,730		$2,309,635		$2,297,843		$2,339,071
Wholesale deposits		710,711		587,217		575,548		457,563		457,708
Total deposits		3,107,140		2,969,947		2,885,183		2,755,406		2,796,779
Federal Home Loan Bank advances and    other borrowings		320,049		349,109		327,855		381,718		330,916
Lease liabilities		7,926		8,054		8,361		8,664		8,954
Derivatives		57,068		45,399		61,821		61,133		51,949
Accrued interest payable and other liabilities		32,443		31,233		28,671		26,649		29,660
Total liabilities		3,524,626		3,403,742		3,311,891		3,233,570		3,218,258
Total stockholders’ equity		328,589		311,982		305,170		297,788		289,588
Total liabilities and stockholders’ equity		$3,853,215		$3,715,724		$3,617,061		$3,531,358		$3,507,846

 

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STATEMENTS OF INCOME

 

(Unaudited)		As of and for the Three Months Ended										As of and for the Year Ended
(Dollars in thousands, except per share amounts)		December 31, 2024		September 30, 2024		June 30, 2024		March 31, 2024		December 31, 2023		December 31, 2024		December 31, 2023
Total interest income		$60,110		$59,327		$57,910		$55,783		$54,762		$233,130		$194,928
Total interest expense		26,962		28,320		27,370		26,272		25,222		108,924		82,340
Net interest income		33,148		31,007		30,540		29,511		29,540		124,206		112,588
Provision for credit losses		2,701		2,087		1,713		2,326		2,573		8,827		8,182
Net interest income after provision for credit losses		30,447		28,920		28,827		27,185		26,967		115,379		104,406
Private wealth management service fees		3,426		3,264		3,461		3,111		2,933		13,262		11,425
Gain on sale of SBA loans		938		460		349		195		284		1,942		2,055
Service charges on deposits		960		920		951		940		848		3,771		3,131
Loan fees		914		812		826		847		869		3,399		3,363
Loss on sale of securities		—		—		—		(8)		—		(8)		(45)
Swap fees		588		460		157		198		438		1,403		2,964
Other non-interest income		1,179		1,148		1,681		1,474		1,722		5,482		8,415
Total non-interest income		8,005		7,064		7,425		6,757		7,094		29,251		31,308
Compensation		15,535		15,198		16,215		16,157		14,450		63,105		61,059
Occupancy		588		585		593		607		571		2,373		2,381
Professional fees		1,323		1,305		1,472		1,571		1,313		5,671		5,325
Data processing		1,647		1,045		1,182		1,018		936		4,892		3,826
Marketing		928		922		850		818		724		3,518		2,889
Equipment		301		333		335		345		340		1,314		1,340
Computer software		1,585		1,608		1,555		1,418		1,317		6,166		4,985
FDIC insurance		728		810		612		610		585		2,760		2,238
Other non-interest expense		517		1,301		1,065		798		1,352		3,681		4,532
Total non-interest expense		23,152		23,107		23,879		23,342		21,588		93,480		88,575
Income before income tax expense		15,300		12,877		12,373		10,600		12,473		51,150		47,139
Income tax expense		885		2,351		1,917		1,752		2,703		6,905		10,112
Net income		$14,415		$10,526		$10,456		$8,848		$9,770		$44,245		$37,027
Preferred stock dividends		219		218		219		219		219		875		875
Net income available to common shareholders		$14,196		$10,308		$10,237		$8,629		$9,551		$43,370		$36,152
Per common share:
Basic earnings		$1.71		$1.24		$1.23		$1.04		$1.15		$5.20		$4.33
Diluted earnings		1.71		1.24		1.23		1.04		1.15		5.20		4.33
Dividends declared		0.2500		0.2500		0.2500		0.2500		0.2275		1.0000		0.9100
Book value		38.17		36.17		35.35		34.41		33.39		38.17		33.39
Tangible book value		36.74		34.74		33.92		32.97		31.94		36.74		31.94
Weighted-average common shares    outstanding(1)		8,107,308		8,111,215		8,113,246		8,125,319		8,110,462		8,148,259		8,131,251
Weighted-average diluted common shares    outstanding(1)		8,107,308		8,111,215		8,113,246		8,125,319		8,110,462		8,148,259		8,131,251

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NET INTEREST INCOME ANALYSIS

 

(Unaudited)		For the Three Months Ended
(Dollars in thousands)		December 31, 2024						September 30, 2024						December 31, 2023
		Average Balance		Interest		Average Yield/Rate(4)		Average Balance		Interest		Average Yield/Rate(4)		Average Balance		Interest		Average Yield/Rate(4)
Interest-earning assets
Commercial real estate and    other mortgage loans(1)		$1,879,136		$30,580		6.51%		$1,805,020		$30,340		6.72%		$1,675,926		$27,359		6.53%
Commercial and industrial    loans(1)		1,176,175		24,709		8.40		1,177,112		24,481		8.32		1,089,558		22,751		8.35
Consumer and other loans(1)		48,392		663		5.48		49,748		685		5.51		45,309		577		5.09
Total loans and leases    receivable(1)		3,103,703		55,952		7.21		3,031,880		55,506		7.32		2,810,793		50,687		7.21
Mortgage-related securities(2)		290,471		2,858		3.94		269,842		2,662		3.95		221,708		2,061		3.72
Other investment securities(3)		45,174		231		2.05		51,446		315		2.45		67,444		541		3.21
FHLB stock		11,788		274		9.30		11,960		285		9.53		12,960		279		8.61
Short-term investments		65,254		795		4.87		40,406		559		5.53		86,580		1,193		5.51
Total interest-earning assets		3,516,390		60,110		6.84		3,405,534		59,327		6.97		3,199,485		54,761		6.85
Non-interest-earning assets		230,218						231,353						255,167
Total assets		$3,746,608						$3,636,887						$3,454,652
Interest-bearing liabilities
Transaction accounts		$928,428		8,161		3.52		$864,936		8,451		3.91		$785,480		7,657		3.90
Money market		833,501		7,571		3.63		850,590		8,780		4.13		734,903		7,145		3.89
Certificates of deposit		210,307		2,282		4.34		219,315		2,584		4.71		278,438		3,160		4.54
Wholesale deposits		594,578		6,106		4.11		531,472		5,475		4.12		450,880		4,682		4.15
Total interest-bearing    deposits		2,566,814		24,120		3.76		2,466,313		25,290		4.10		2,249,701		22,644		4.03
FHLB advances		270,476		1,969		2.91		278,103		2,059		2.96		301,773		1,851		2.45
Other borrowings		54,672		874		6.39		50,642		971		7.67		49,394		727		5.89
Total interest-bearing    liabilities		2,891,962		26,963		3.73		2,795,058		28,320		4.05		2,600,868		25,222		3.88
Non-interest-bearing demand    deposit accounts		444,683						440,161						448,818
Other non-interest-bearing    liabilities		90,555						91,520						119,833
Total liabilities		3,427,200						3,326,739						3,169,519
Stockholders’ equity		319,408						310,148						285,133
Total liabilities and    stockholders’ equity		$3,746,608						$3,636,887						$3,454,652
Net interest income				$33,147						$31,007						$29,539
Interest rate spread						3.11%						2.92%						2.97%
Net interest-earning assets		$624,428						$610,476						$598,617
Net interest margin						3.77%						3.64%						3.69%

 

 

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NET INTEREST INCOME ANALYSIS

 

		For the Year Ended December 31,
		2024						2023						2022
		Average Balance		Interest		Average Yield/ Rate		Average Balance		Interest		Average Yield/ Rate		Average Balance		Interest		Average Yield/ Rate
		(Dollars in Thousands)
Interest-earning assets
Commercial real estate and other mortgage loans(1)		$1,793,041		$118,339		6.60%		$1,586,967		$98,370		6.20%		$1,484,239		$66,917		4.51%
Commercial and industrial loans(1)		1,153,955		95,782		8.30%		1,013,866		81,963		8.08%		771,056		46,575		6.04%
Consumer and other loans(1)		49,885		2,777		5.57%		47,018		2,316		4.93%		49,695		1,876		3.78%
Total loans and leases receivable(1)		2,996,881		216,898		7.24%		2,647,851		182,649		6.90%		2,304,990		115,368		5.01%
Mortgage-related securities(2)		266,098		10,405		3.91%		200,383		6,433		3.21%		173,495		3,486		2.01%
Other investment securities(3)		56,301		1,507		2.68%		62,921		1,770		2.81%		51,700		986		1.91%
FHLB and FRB stock		12,167		1,133		9.31%		15,162		1,231		8.12%		16,462		989		6.01%
Short-term investments		59,853		3,186		5.32%		54,311		2,845		5.24%		30,845		542		1.76%
Total interest-earning assets		3,391,300		233,129		6.87%		2,980,628		194,928		6.54%		2,577,492		121,371		4.71%
Non-interest-earning assets		234,973						231,521						175,424
Total assets		$3,626,273						$3,212,149						$2,752,916
Interest-bearing liabilities
Transaction accounts		$884,321		33,796		3.82%		$689,500		23,727		3.44%		$503,668		3,963		0.79%
Money market accounts		815,603		32,180		3.95%		681,336		22,129		3.25%		761,469		6,241		0.82%
Certificates of deposit		237,228		10,879		4.59%		273,387		11,209		4.10%		97,448		1,358		1.39%
Wholesale deposits		515,197		21,066		4.09%		346,285		14,353		4.14%		48,825		1,616		3.31%
Total interest-bearing deposits		2,452,349		97,921		3.99%		1,990,508		71,418		3.59%		1,411,410		13,178		0.93%
FHLB advances		282,437		7,719		2.73%		351,990		8,881		2.52%		414,191		7,024		1.70%
Other borrowings		51,072		3,284		6.43%		38,891		2,041		5.25%		43,818		2,243		5.12%
Junior subordinated notes(4)		—		—		—		—		—		—		2,429		504		20.75%
Total interest-bearing liabilities		2,785,858		108,924		3.91%		2,381,389		82,340		3.46%		1,871,848		22,949		1.23%
Non-interest-bearing demand deposit accounts		441,313						453,930						566,230
Other non-interest-bearing liabilities		92,708						102,668						65,611
Total liabilities		3,319,879						2,937,987						2,503,689
Stockholders’ equity		306,394						274,162						249,227
Total liabilities and stockholders’ equity		$3,626,273						$3,212,149						$2,752,916
Net interest income				$124,205						$112,588						$98,422
Interest rate spread						2.96%						3.08%						3.48%
Net interest-earning assets		$605,442						$599,239						$705,644
Net interest margin						3.66%						3.78%						3.82%
Average interest-earning assets to average interest-bearing liabilities		121.73%						125.16%						137.70%
Return on average assets(4)		1.20%						1.13%						1.46%
Return on average common equity(4)		14.73%						13.79%						16.79%
Average equity to average assets		8.45%						8.54%						9.05%
Non-interest expense to average assets(4)		2.58%						2.76%						2.89%

 

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BETA ANALYSIS

 

		For the Three Months Ended
(Unaudited)		December 31, 2024		September 30, 2024
		Average Yield/Rate (3)		Average Yield/Rate (3)		Increase (Decrease)
Total loans and leases    receivable (a)		7.21%		7.32%		(0.11)%
Total interest-earning assets(b)		6.84%		6.97%		(0.13)%
Adjusted total loans and leases    receivable (1)(c)		6.91%		7.20%		(0.29)%
Adjusted total interest-earning    assets (1)(d)		6.57%		6.86%		(0.29)%
Total core deposits(e)		2.98%		3.34%		(0.36)%
Total bank funding(f)		3.18%		3.44%		(0.26)%
Net interest margin(g)		3.77%		3.64%		0.13%
Adjusted net interest margin(h)		3.48%		3.51%		(0.03)%
Effective fed funds rate (2)(i)		4.65%		5.27%		(0.62)%
Beta Calculations:
Total loans and leases    receivable(a)/(i)						17.6%
Total interest-earning assets(b)/(i)						21.3%
Adjusted total loans and leases    receivable (1)(c)/(i)						46.8%
Adjusted total interest-earning    assets (1)(d)/(i)						46.8%
Total core deposits(e/i)						58.1%
Total bank funding(f)/(i)						41.9%
Net interest margin(g/i)						(21.0)%
Adjusted net interest margin(h/i)						4.8%

 

 

PROVISION FOR CREDIT LOSS COMPOSITION

 

(Unaudited)		For the Three Months Ended										For the Twelve Months Ended
(Dollars in thousands)		December 31, 2024		September 30, 2024		June 30, 2024		March 31, 2024		December 31, 2023		December 31, 2024		December 31, 2023
Change due to qualitative factor changes		$(460)		$(444)		$496		$740		$(432)		$332		$33
Change due to quantitative factor    changes		(598)		(330)		150		(199)		(260)		(977)		(1,453)
Charge-offs		1,132		1,619		1,583		921		724		5,255		1,781
Recoveries		(190)		(91)		(191)		(227)		(114)		(699)		(548)
Change in reserves on individually    evaluated loans, net		2,579		757		(1,037)		629		2,008		2,928		4,330
Change due to loan growth, net		577		616		680		354		629		2,227		3,652
Change in unfunded commitment    reserves		(339)		(40)		32		108		17		(239)		387
Total provision for credit losses		$2,701		$2,087		$1,713		$2,326		$2,572		$8,827		$8,182

 

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PERFORMANCE RATIOS

 

		For the Three Months Ended										For the Twelve Months Ended
(Unaudited)		December 31, 2024		September 30, 2024		June 30, 2024		March 31, 2024		December 31, 2023		December 31, 2024		December 31, 2023
Return on average assets (annualized)		1.52%		1.13%		1.14%		0.98%		1.11%		1.20%		1.13%
Return on average tangible common equity (annualized)		19.21%		14.40%		14.73%		12.79%		14.64%		15.35%		14.45%
Efficiency ratio		56.94%		59.44%		62.75%		63.76%		58.34%		60.61%		60.99%
Interest rate spread		3.11%		2.92%		2.95%		2.88%		2.97%		2.96%		3.08%
Net interest margin		3.77%		3.64%		3.65%		3.58%		3.69%		3.66%		3.78%
Average interest-earning assets to average interest-bearing liabilities		121.59%		121.84%		121.37%		122.15%		123.02%		121.73%		125.16%

 

ASSET QUALITY RATIOS

 

(Unaudited)		As of
(Dollars in thousands)		December 31, 2024		September 30, 2024		June 30, 2024		March 31, 2024		December 31, 2023
Non-accrual loans and leases		$28,367		$19,364		$18,999		$19,829		$20,597
Repossessed assets		51		56		54		317		247
Total non-performing assets		$28,418		$19,420		$19,053		$20,146		$20,844
Non-accrual loans and leases as a    percent of total gross loans and leases		0.91%		0.63%		0.64%		0.68%		0.72%
Non-performing assets as a percent of    total gross loans and leases plus    repossessed assets		0.91%		0.64%		0.64%		0.69%		0.73%
Non-performing assets as a percent of    total assets		0.74%		0.52%		0.53%		0.57%		0.59%
Allowance for credit losses as a percent    of total gross loans and leases		1.20%		1.16%		1.17%		1.19%		1.16%
Allowance for credit losses as a percent    of non-accrual loans and leases		131.38%		183.38%		183.96%		174.64%		160.21%

 

NET CHARGE-OFFS (RECOVERIES)

 

(Unaudited)		For the Three Months Ended										For the Twelve Months Ended
(Dollars in thousands)		December 31, 2024		September 30, 2024		June 30, 2024		March 31, 2024		December 31, 2023		December 31, 2024		December 31, 2023
Charge-offs		$1,132		$1,619		$1,583		$921		$724		$5,255		$1,781
Recoveries		(190)		(91)		(191)		(227)		(114)		(699)		(548)
Net charge-offs (recoveries)		$942		$1,528		$1,392		$694		$610		$4,556		$1,233
Net charge-offs (recoveries) as a percent of average gross loans and leases (annualized)		0.12%		0.20%		0.19%		0.10%		0.09%		0.15%		0.05%

 

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CAPITAL RATIOS

 

		As of and for the Three Months Ended
(Unaudited)		December 31, 2024		September 30, 2024		June 30, 2024		March 31, 2024		December 31, 2023
Total capital to risk-weighted assets		12.08%		11.72%		11.45%		11.36%		11.19%
Tier I capital to risk-weighted assets		9.45%		9.11%		8.99%		8.86%		8.74%
Common equity tier I capital to risk-    weighted assets		9.10%		8.76%		8.64%		8.51%		8.38%
Tier I capital to adjusted assets		8.78%		8.68%		8.51%		8.45%		8.43%
Tangible common equity to tangible    assets		7.93%		7.78%		7.80%		7.78%		7.60%

 

LOAN AND LEASE RECEIVABLE COMPOSITION

 

(Unaudited)		As of
(in thousands)		December 31, 2024		September 30, 2024		June 30, 2024		March 31, 2024		December 31, 2023
Commercial real estate:
Commercial real estate - owner occupied		$273,397		$259,532		$258,636		$263,748		$256,479
Commercial real estate - non-owner occupied		845,298		768,195		777,704		792,858		773,494
Construction		221,086		266,762		229,181		202,382		193,080
Multi-family		530,853		494,954		470,176		453,321		450,529
1-4 family		46,496		39,933		39,680		27,482		26,289
Total commercial real estate		1,917,130		1,829,376		1,775,377		1,739,791		1,699,871
Commercial and industrial		1,151,720		1,174,295		1,161,711		1,120,779		1,105,835
Consumer and other		45,000		46,610		48,145		50,020		44,312
Total gross loans and leases receivable		3,113,850		3,050,281		2,985,233		2,910,590		2,850,018
Less:
Allowance for credit losses		35,785		33,688		33,088		32,799		31,275
Deferred loan fees		722		202		(181)		(274)		(243)
Loans and leases receivable, net		$3,077,343		$3,016,391		$2,952,326		$2,878,065		$2,818,986

 

DEPOSIT COMPOSITION

 

(Unaudited)		As of
(in thousands)		December 31, 2024		September 30, 2024		June 30, 2024		March 31, 2024		December 31, 2023
Non-interest-bearing transaction accounts		$436,111		$428,012		$406,804		$400,267		$445,376
Interest-bearing transaction accounts		965,637		930,252		841,146		818,080		895,319
Money market accounts		809,695		817,129		837,569		813,467		711,245
Certificates of deposit		184,986		207,337		224,116		266,029		287,131
Wholesale deposits		710,711		587,217		575,548		457,563		457,708
Total deposits		$3,107,140		$2,969,947		$2,885,183		$2,755,406		$2,796,779
Uninsured deposits		$980,278		$1,088,496		$1,011,977		$995,428		$994,687
Less: uninsured deposits collateralized by pledged assets		6,864		10,755		34,810		16,622		17,051
Total uninsured, net of collateralized deposits		973,414		1,077,741		977,167		978,806		977,636
% of total deposits		31.3%		36.3%		33.9%		35.5%		35.0%

 

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SOURCES OF LIQUIDITY

 

(Unaudited)		As of
(in thousands)		December 31, 2024		September 30, 2024		June 30, 2024		March 31, 2024		December 31, 2023
Short-term investments		$128,207		$86,670		$54,680		$46,984		$107,162
Collateral value of unencumbered pledged loans		444,453		397,852		401,602		340,639		367,471
Market value of unencumbered securities		310,125		279,191		289,104		288,965		259,791
Readily accessible liquidity		882,785		763,713		745,386		676,588		734,424
Fed fund lines		45,000		45,000		45,000		45,000		45,000
Excess brokered CD capacity(1)		981,463		1,102,767		1,051,678		1,166,661		1,231,791
Total liquidity		$1,909,248		$1,911,480		$1,842,064		$1,888,249		$2,011,215
Total uninsured, net of collateralized deposits		973,414		1,077,741		977,167		978,806		977,636

 

PRIVATE WEALTH OFF-BALANCE SHEET COMPOSITION

 

(Unaudited)		As of
(in thousands)		December 31, 2024		September 30, 2024		June 30, 2024		March 31, 2024		December 31, 2023
Trust assets under management		$3,160,449		$3,145,789		$3,008,897		$3,080,951		$2,898,516
Trust assets under administration		258,255		252,152		239,766		239,249		223,013
Total trust assets		$3,418,704		$3,397,941		$3,248,663		$3,320,200		$3,121,529

 

NON-GAAP RECONCILIATIONS

Certain financial information provided in this release is determined by methods other than in accordance with generally accepted accounting principles (United States) (“GAAP”). Although the Company’s management believes that these non-GAAP financial measures provide a greater understanding of its business, these measures are not necessarily comparable to similar measures that may be presented by other companies.

TANGIBLE BOOK VALUE

“Tangible book value per share” is a non-GAAP measure representing tangible common equity divided by total common shares outstanding. “Tangible common equity” itself is a non-GAAP measure representing common stockholders’ equity reduced by intangible assets, if any. The Company’s management believes that this measure is important to many investors in the marketplace who are interested in period-to-period changes in book value per common share exclusive of changes in intangible assets. The information provided below reconciles tangible book value per share and tangible common equity to their most comparable GAAP measures.

 

(Unaudited)		As of
(Dollars in thousands, except per share amounts)		December 31, 2024		September 30, 2024		June 30, 2024		March 31, 2024		December 31, 2023
Common stockholders’ equity		$316,597		$299,990		$293,178		$285,796		$277,596
Less: Goodwill and other intangible assets		(11,912)		(11,834)		(11,841)		(11,950)		(12,023)
Tangible common equity		$304,685		$288,156		$281,337		$273,846		$265,573
Common shares outstanding		8,293,928		8,295,017		8,294,589		8,306,573		8,314,778
Book value per share		$38.17		$36.17		$35.35		$34.41		$33.39
Tangible book value per share		36.74		34.74		33.92		32.97		31.94

 

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TANGIBLE COMMON EQUITY TO TANGIBLE ASSETS

“Tangible common equity to tangible assets” (“TCE”) is defined as the ratio of common stockholders’ equity reduced by intangible assets, if any, divided by total assets reduced by intangible assets, if any. Adjusted TCE ratio is defined as TCE adjusted for net fair value adjustments of financial assets and liabilities. For more information on fair value adjustments please refer to Note 19 - Fair Value Disclosures in the annual report on Form 10-K for the year ended December 31, 2023. The Company’s management believes that this measure is important to many investors in the marketplace who are interested in the relative changes from period to period in common equity and total assets, each exclusive of changes in intangible assets. The information below reconciles tangible common equity and tangible assets to their most comparable GAAP measures.

 

		As of
(Dollars in thousands)		December 31, 2024		September 30, 2024		June 30, 2024		March 31, 2024		December 31, 2023
Common stockholders’ equity		$316,597		$299,990		$293,178		$285,796		$277,596
Less: Goodwill and other intangible assets		(11,912)		(11,834)		(11,841)		(11,950)		(12,023)
Tangible common equity (a)		$304,685		$288,156		$281,337		$273,846		$265,573
Total assets		$3,853,215		$3,715,724		$3,617,061		$3,531,358		$3,507,846
Less: Goodwill and other intangible assets		(11,912)		(11,834)		(11,841)		(11,950)		(12,023)
Tangible assets (b)		$3,841,303		$3,703,890		$3,605,220		$3,519,408		$3,495,823
Tangible common equity to tangible assets		7.93%		7.78%		7.80%		7.78%		7.60%
Fair Value Adjustments:
Financial assets - MTM (c)		$(26,580)		$(17,615)		$(17,432)		$(29,019)		$(29,136)
Financial liabilities - MTM (d)		$5,946		$8,358		$9,032		$12,560		$11,945
Net MTM, after-tax e = (c-d)*(1-21%)		$(16,301)		$(7,313)		$(6,636)		$(13,003)		$(13,581)
Adjusted tangible equity f = (a-e)		$288,384		$280,843		$274,701		$260,843		$251,992
Adjusted tangible assets g = (b-c)		$3,814,723		$3,686,275		$3,587,788		$3,490,389		$3,466,687
Adjusted TCE ratio (f/g)		7.56%		7.62%		7.66%		7.47%		7.27%

 

EFFICIENCY RATIO & PRE-TAX, PRE-PROVISION ADJUSTED EARNINGS

“Efficiency ratio” is a non-GAAP measure representing non-interest expense excluding the effects of the SBA recourse provision, impairment of tax credit investments, losses or gains on repossessed assets, amortization of other intangible assets and other discrete items, if any, divided by operating revenue, which is equal to net interest income plus non-interest income less realized gains or losses on securities, if any. “Pre-tax, pre-provision adjusted earnings” is defined as operating revenue less operating expense. In the judgment of the Company’s management, the adjustments made to non-interest expense and non-interest income allow investors and analysts to better assess the Company’s operating expenses in relation to its core operating revenue by removing the volatility that is associated with certain one-time items and other discrete items. The information provided below reconciles the efficiency ratio and pre-tax, pre-provision adjusted earnings to its most comparable GAAP measure.

 

(Unaudited)		For the Three Months Ended										For the Twelve Months Ended
(Dollars in thousands)		December 31, 2024		September 30, 2024		June 30, 2024		March 31, 2024		December 31, 2023		December 31, 2024		December 31, 2023
Total non-interest expense		$23,152		$23,107		$23,879		$23,342		$21,588		$93,480		$88,575
Less:
Net loss on repossessed assets		5		11		65		86		4		168		13
Impairment of tax credit investments		400		0		0		0		0		400		0
SBA recourse (benefit) provision		(687)		466		(9)		126		210		(104)		775
Total operating expense (a)		$23,434		$22,630		$23,823		$23,130		$21,374		$93,016		$87,787
Net interest income		$33,148		$31,007		$30,540		$29,511		$29,540		$124,206		$112,588
Total non-interest income		8,005		7,064		7,425		6,757		7,094		29,251		31,308
Less:
Net loss on sale of securities		—		—		—		(8)		—		(8)		(45)
Adjusted non-interest income		8,005		7,064		7,425		6,765		7,094		29,259		31,353
Total operating revenue (b)		$41,153		$38,071		$37,965		$36,276		$36,634		$153,465		$143,941
Efficiency ratio		56.94%		59.44%		62.75%		63.76%		58.34%		60.61%		60.99%
Pre-tax, pre-provision adjusted earnings (b - a)		$17,719		$15,441		$14,142		$13,146		$15,260		$60,449		$56,154
Average total assets		$3,746,608		$3,636,887		$3,592,215		$3,527,941		$3,454,652		$3,626,273		$3,212,149

 

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ADJUSTED NET INTEREST MARGIN

“Adjusted Net Interest Margin” is a non-GAAP measure representing net interest income excluding the fees in lieu of interest and other recurring, but volatile, components of net interest margin divided by average interest-earning assets less other recurring, but volatile, components of average interest-earning assets. Fees in lieu of interest are defined as prepayment fees, asset-based loan fees, non-accrual interest, and loan fee amortization. In the judgment of the Company’s management, the adjustments made to net interest income allow investors and analysts to better assess the Company’s net interest income in relation to its core client-facing loan and deposit rate changes by removing the volatility that is associated with these recurring but volatile components. The information provided below reconciles the net interest margin to its most comparable GAAP measure.

 

(Unaudited)		For the Three Months Ended										For the Twelve Months Ended
(Dollars in thousands)		December 31, 2024		September 30, 2024		June 30, 2024		March 31, 2024		December 31, 2023		December 31, 2024		December 31, 2023
Interest income		$60,110		$59,327		$57,910		$55,783		$54,762		$233,130		$194,928
Interest expense		26,962		28,320		27,370		26,272		25,222		108,924		82,340
Net interest income (a)		33,148		31,007		30,540		29,511		29,540		124,206		112,588
Less:
Fees in lieu of interest		2,359		1,002		1,306		849		1,121		5,516		3,452
FRB interest income and FHLB dividend income		1,062		841		959		1,436		1,466		4,298		4,056
Adjusted net interest income (b)		$29,727		$29,164		$28,275		$27,226		$26,953		$114,392		$105,080
Average interest-earning assets (c)		$3,516,390		$3,405,534		$3,347,027		$3,294,717		$3,199,485		$3,391,300		$2,980,628
Less:
Average FRB cash and FHLB stock		76,576		52,603		61,082		97,036		99,118		71,784		69,014
Average non-accrual loans and leases		19,077		18,954		19,807		20,540		18,602		19,589		10,450
Adjusted average interest-earning assets (d)		$3,420,737		$3,333,977		$3,266,138		$3,177,141		$3,081,765		$3,299,927		$2,901,164
Net interest margin (a / c)		3.77%		3.64%		3.65%		3.58%		3.69%		3.66%		3.78%
Adjusted net interest margin (b / d)		3.48%		3.50%		3.46%		3.43%		3.50%		3.47%		3.62%

 

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Investor Presentation Fourth Quarter 2024

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When used in this presentation, and in any other oral statements made with the approval of an authorized executive officer, the words or phrases “may,” “could,” “should,” “hope,” “might,” “believe,” “expect,” “plan,” “assume,” “intend,” “estimate,” “anticipate,” “project,” “likely,” or similar expressions are intended to identify “forward-looking statements” within the meaning of such term in the Private Securities Litigation Reform Act of 1995. Such statements are subject to risks and uncertainties, including among other things: (i) Adverse changes in the economy or business conditions, either nationally or in our markets, including, without limitation, inflation, economic downturn, labor shortages, wage pressures, and the adverse effects of public health events on the global, national, and local economy, which may affect the Corporation’s credit quality, revenue, and business operations; (ii) Competitive pressures among depository and other financial institutions nationally and in our markets; (iii) Increases in defaults by borrowers and other delinquencies; (iv) Our ability to manage growth effectively, including the successful expansion of our client support, administrative infrastructure, and internal management systems; (v) Fluctuations in interest rates and market prices; (vi) Changes in legislative or regulatory requirements applicable to us and our subsidiaries; (vii) Changes in tax requirements, including tax rate changes, new tax laws, and revised tax law interpretations; (viii) Fraud, including client and system failure or breaches of our network security, including our internet banking activities; (ix) Failure to comply with the applicable SBA regulations in order to maintain the eligibility of the guaranteed portions of SBA loans. (x) Ongoing volatility in the banking sector may result in new legislation, regulations or policy changes that could subject the Corporation and the Bank to increased government regulation and supervision, (xi) the proportion of the Corporation’s deposit account balances that exceed FDIC insurance limits may expose the Bank to enhanced liquidity risk, and (xii) The Corporation may be subject to increases in FDIC insurance assessments. These risks could cause actual results to differ materially from what FBIZ has anticipated or projected. These risks could cause actual results to differ materially from what we have anticipated or projected. These risk factors and uncertainties should be carefully considered by our shareholders and potential investors. For further information about the factors that could affect the Corporation’s future results, please see the Corporation’s annual report on Form 10-K for the year ended December 31, 2023 and other filings with the Securities and Exchange Commission. Investors should not place undue reliance on any such forward-looking statement, which speaks only as of the date on which it was made. The factors described within the filings could affect our financial performance and could cause actual results for future periods to differ materially from any opinions or statements expressed with respect to future periods. Where any such forward-looking statement includes a statement of the assumptions or bases underlying such forward-looking statement, FBIZ cautions that, while its management believes such assumptions or bases are reasonable and are made in good faith, assumed facts or bases can vary from actual results, and the differences between assumed facts or bases and actual results can be material, depending on the circumstances. Where, in any forward-looking statement, an expectation or belief is expressed as to future results, such expectation or belief is expressed in good faith and believed to have a reasonable basis, but there can be no assurance that the statement of expectation or belief will be achieved or accomplished. FBIZ does not intend to, and specifically disclaims any obligation to, update any forward-looking statements. Forward-Looking Statements

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Table of Contents Q4 2024 Results 4 Company Snapshot 5 Strategic Plan 6 Why FBIZ? 10 Drivers of Growth & Profitability 18 Appendix 27

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EPS $1.71 Private Wealth $3.4 B in AUM&A Loans +8% NIM 3.77% TBV per Share +23% Fourth Quarter 2024 Highlights Record operating revenue, strong net interest margin, and positive operating leverage drive record pre-tax, pre-provision earnings Note: Percentages represent growth over the prior quarter. PTPP Income +15% Strong earnings generation produced a 23.0% annualized increase in tangible book value per share compared to the linked quarter and 15.0% compared to the prior year quarter Robust Private Wealth Management assets under management grew to a record $3.419 billion PWM fee income totaled $3.4 million for Q4 2024, up 16.8% over Q4 2023 Record performance reflects continued balance sheet growth coupled with operational efficiency PTPP income totaled $17.7 million for Q4 2024, up 16.1% from Q4 2023 Consistent loan growth throughout the Company Loans grew 8.3% annualized from the prior quarter and 9.3% from the Q4 2023 Match funding strategy and pricing discipline produced a strong net interest margin of 3.77% Fees in lieu of interest grew $1.4 million for Q4 2024, up 139% from the prior quarter Reported earnings elevated by tax benefit and SBA recourse reserve Excluding these benefits the fourth quarter EPS was $1.43

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Serving unique needs of business executives, entrepreneurs, and high net worth individuals through Business Banking, Private Wealth, and Bank Consulting Within Business Banking, our commercial banking offerings are focused on our stable and attractive Midwest markets while Specialty Finance products and services have national reach Efficient and highly scalable model with very limited branch network and exceptional digital capabilities Headquarters: Madison, WI Mission: Build long-term shareholder value as an entrepreneurial banking partner that drives success for businesses, investors, and our communities FBIZ Business Banking2 $3.8 Billion3 FBIZ Private Wealth $3.4 Billion3 IN ASSETS UNDER MANAGEMENT & ADMINISTRATION Market capitalization as of 1/29/2025. Consists of all on-balance sheet assets for First Business Financial Services, Inc. on a consolidated basis. Data as of 12/31/2024. 5 IN TOTAL ASSETS First Business Bank NASDAQ: FBIZ — $405 million Market Cap1

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Five Year Strategic Plan

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2024-2028 Strategies OBJECTIVE First Business Bank's unique model and culture will foster innovative and engaged team members who develop deep client relationships and deliver exceptional results for all stakeholders.

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2024-2028 Goals & Progress Plan aims to deliver above average total shareholder return compared to peer median ROATCE and TBV Growth includes the impact of a $1.7 million benefit from a partial release of a state deferred tax valuation allowance recognized in Q4 2024. Revenue growth muted in 2024 due to exceptional SBIC and swap fee income recognized in 2023. Represents data from the 2024 employee engagement survey. Net promoter score assesses likelihood to recommend on an 11-point scale, where detractors (scores 0-6) are subtracted from promoters (scores 9-10), while passives (scores 7-8) are not considered. See appendix for additional information on the source of the net promoter score. Represents data from the 2024 survey. Goals 2024-2028 2024 ROATCE1 ≥15% by 2028 15.4% TBV Growth1 ≥10% per year 15.0% Revenue Growth2 ≥10% per year 6.6% Efficiency Ratio <60% by 2028 60.61% Core Deposits to Total Funding ≥75% 71% Employee Engagement & Participation3 ≥85% 86% Net Promoter Score4 ≥70 70

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Note: Peer Group defined as publicly traded banks with total assets between $1.75 billion and $7.0 billion. 1-Year, 3-Year, and 5-Year TSR is through 12/31/2024. Data as of 9/30/2024. Total Shareholder Return Above Peer Group Median Despite recent outperformance, Price/LTM EPS remains below peers

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WHY FBIZ?

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Growing Profitability FBIZ’s Historic and Ongoing Growth Supports Earnings Power Differentiated Loan Growth Capabilities History of consistent double-digit growth Growth is C&I focused and diversified   Solid credit quality due to deep client relationships, strong underwriting, and niche business expertise Strong & Stable Deposit Franchise Track record of double-digit growth driven by deep client relationships Creates relatively stable and strong NIM in a challenging environment Deposit-centric culture led by treasury management sales also drives meaningful service charge income Growing Profitability Profile Significant fee revenue contribution from Private Wealth business History of long-term positive operating leverage Consistent double-digit TBV growth History of double-digit top line revenue growth 13% 5-year Loan CAGR 2019-2024 12% 5-year Core Deposit CAGR 2019-2024 12% 5-year TBV/Share CAGR 2019-2024

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Balanced and Steady Growth Operating Fundamentals Drive Earnings Power Note: Net interest income is the sum of "Adjusted Net Interest Income", “Other Interest Income”, and "Fees in Lieu of Interest". Non-interest income is the sum of "Private Wealth Management Service Fees", "Other Fee Income", "Service Charges", "SBA Gains", and "Swap Fees". "Adjusted Net Interest Income" and "Net Operating Income" are non-GAAP measurements. See appendix for non-GAAP reconciliation schedules. "Net Tax Credits" represent management's estimate of the after-tax contribution related to the investment in tax credits as of the reporting period disclosed. "Fees in Lieu of Interest" is defined as prepayment fees, asset-based loan fees, non-accrual interest, and loan fee amortization. Steady revenue expansion supported by: Double-digit loan and deposit growth Strong and stable net interest margin Diverse sources of non-interest income, including service fees from our Private Wealth Management business which comprises 43% of total non-interest income Strategic investments drive growth while maintaining positive long-term operating leverage Strong earnings power reflected in 2024 ROAA of 1.20%. 5 Net Operating Income Year CAGR = XX% Operating Income Highlights

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Margin Strength Through Rate Cycles Match-Funding Strategy Better Positions Balance Sheet for Rate Changes Peer Group defined as publicly-traded banks with total assets between $1.75 billion and $7.0 billion.

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Disciplined Interest Rate Risk Management Match-Funding Strategy Insulates Balance Sheet throughout Various Rate Cycles Methodical Approach Individually match-fund loans with maturities over 5 years and amounts greater than $5MM Portfolio match-funding in various terms against the fixed-rate loan portfolio with maturities under 5 years and amounts less than $5MM ~$10-$25 million of monthly wholesale funding maturities to effectively manage the liquidity requirements of the match-funding strategy Floating Rate Portfolio Floating portfolio is predominantly indexed to SOFR, which aligns with the Bank’s SOFR-indexed and managed rate non-maturity deposit portfolio 54% as of 12/31/24 Balances as of 12/31/24: Fixed Rate Portfolio Wholesale funding used to match maturities and cash flows on long-term fixed rate loans. This locks in interest rate spread and maintains greater stability in net interest margin 46% as of 12/31/24 46% Fixed Rate Loans as of 9/30/24 54% Variable Rate Loans as of 9/30/24 Loans Deposits SOFR = $1.268 B SOFR = $678 MM Prime = $400.0 MM Managed rate, non-maturity = $1.011 B

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Operating Leverage Outperforms Peers History of Growing Revenues Faster than Expenses Note: Peer group defined as publicly traded bank with total assets between $1.75 billion and $7 billion. 3Q24 represent data for the trailing 12 months. Peer data not yet available for full year 2024. Operating leverage is defined as the percent growth in operating revenue less the percent growth in operating expenses. FBIZ and peer average data is average of 2019-TTM 9/30/24 We aim to achieve 10% revenue growth on an annual basis, with positive operating leverage Despite headwinds related to outsized NIM in 2023, we achieved positive operating leverage in 2024 for the sixth consecutive year Strategic initiatives directed toward revenue growth and operating efficiency through use of technology have generated positive operating leverage on an annual basis Operating revenue 5-year CAGR of 10.4% outpaces operating expense 5-year CAGR of 8.4% Initiatives include: Expanding higher-yielding C&I lending business lines Strong focus on treasury management and growing core deposits Increasing our commercial banking market share outside of Madison Scaling our Private Wealth Management business in our less mature commercial banking markets Robotic process automation implementation AI usage discovery and roll out 1 FBIZ Avg2 = 3.3% Peer Avg2 = -1.8%

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Growth and Profitability Exceeds Peers Top Line Revenue Growth and Efficient Capital Management Drives Strong Profitability Note: Peer group defined as publicly traded bank with total assets between $1.75 billion and $7 billion. Peer data not yet available for full year 2024.

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Shareholder Value Creation History of Steady, Consistent TBV and Dividend Growth Through Economic and Interest Rate Cycles TBV 5YR CAGR = 12% Div/Share 5YR CAGR = 11% CAGR = 11%

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Drivers of Growth & Profitability

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Relationship Banking Key to Success Solid Core Deposit Growth Despite Banking Industry Trends Long-term client relationships drive core deposit growth, aided by clients’ comfort with utilizing the Bank’s longstanding extended deposit insurance products Successful execution of client deposit initiatives has attracted new relationships and increased gross treasury management service charges Long-held top-quartile deposit pricing strategy promotes retention Net Promoter Score1 of 70 is well above industry benchmark score of 24. 1. Net promoter score benchmarks reported in “The State of B2B Account Experience: B2B NPS & CX Benchmarking Report,” CustomerGauge, 2021 NPS benchmarks reported in “The State of B2B Account Experience: B2B NPS & CX Benchmarking Report,” CustomerGauge, 2021. Net promoter score assesses likelihood to recommend on an 11-point scale, where detractors (scores 0-6) are subtracted from promoters (scores 9-10), while passives (scores 7-8) are not considered. The score ranges from -100 to +100. Net promoter score assesses likelihood to recommend on an 11-point scale, where detractors (scores 0-6) are subtracted from promoters (scores 9-10), while passives (scores 7-8) are not considered. See appendix for additional information on the source of the net promoter score. Growth over prior year = 13% Growth over prior year = 11%

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Core Deposit Strength FBIZ Continues to Grow Core Deposits as Industry and Peers Decline Source: S&P Capital IQ. Core Deposits defined as deposits in U.S. offices excluding time deposits over $250,000 and brokered deposits of $250,000 or less. Peer banks defined as publicly traded bank with total assets between $1.75 billion and $7 billion. Core Deposit2 Growth: 2Q22 through 1Q23 FBIZ 3.8% Proxy Peers Median -6.8% All Publicly Traded Banks Median Public Banks with $1.5-$5.5 Assets Median

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Deposit-Centric Strategy Key to Growth Double Digit Core Deposit Growth Supports Double Digit Loan Growth Core deposits defined as total deposits less wholesale deposits. Period end balances are presented. Deposit growth remains one of our major strategic priorities under our new 5-year plan Deposit-centric sales strategy led by treasury management sales located in all bank markets with direct production and outside calling goals Bankers trained to fund their loan production with deposit growth goals Deposit-focused individual banker incentive compensation and bank level bonus plans 5YR CAGR = 11.4% DDA 5-Year CAGR = 8% Total Core Deposits 5-Year CAGR = 12%

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Diversified Lending Growth Continuing to Grow Higher Yielding C&I Lending Mix Period end balances excluding PPP loans are presented. On January 1, 2023, the Bank adopted ASU 2016-03 Financial Instruments - Credit losses (“ASC 326”). The Bank adopted ASC 326 using the modified retrospective method which does not require restatement of prior periods. The balances as of December 31, 2023 reflect a reclassification of $43 million to commercial and industrial from commercial real estate, and $7 million from consumer and other to commercial real estate. Average balances excluding PPP loans are presented. Excluding the impact of PPP loan fees and interest income 5 Year CAGR = 13% Exceeds strategic plan goal of 10%

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Robust Profitability Metrics Strong Balance Sheet Growth and Resilient Net Interest Margin Support Robust ROAA Note: Peer group defined as publicly-traded bank with total assets between $1.75 billion and $7 billion. Peer data not yet available for 4Q24. "Adjusted Net Interest Margin" is a non-GAAP measurement. See appendix for non-GAAP reconciliation schedules. "Recurring, variable components" is defined as fees in lieu of interest, FRB interest income, and FHLB dividend income. $1.7 million benefit from a partial release of a state deferred tax valuation allowance recognized in Q4 2024 3

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Net Interest Margin Components Wholesale funding defined as brokered CDs and non-reciprocal interest-bearing transaction accounts plus FHLB advances. Cost of funds is defined as total interest expense on deposits and FHLB advances, divided by the sum of total average deposits and average FHLB advances. NIM range in forecast Rate assumptions in forecast Beta outlook Impact under differing scenarios 5YR CAGR = 11.4%

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Solid Asset Quality Non-Performing Assets/Total Assets Remain Well Managed Note: Peer group defined as publicly-traded bank with total assets between $1.75 billion and $7.0 billion. Peer data not yet available for 4Q24. Represents a fully collateralized ABL credit, for which the Company expects full repayment. Excluding this credit, non-performing assets totaled $22.2 million, or 0.58% of total assets as of 12/31/24. For more detailed definitions on credit quality categories see the Bank's 10-K filed with the SEC on February 28, 2024. As of 12/31/2024, 95% of the loan portfolio was classified in category I(2) and 99% of loans were current. In the ABL pool, we continue to expect full repayment related to the second quarter 2023 $10.9 million default, now paid down to $6.2 million. Excluding this credit, non-performing assets totaled $22.2 million, or 0.58% of total assets as of 12/31/24. Isolated weakness in the $41 million transportation segment of the Equipment Finance portfolio. 

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Maturing Over Time Equipment Finance Portfolio by Industry For more detailed definitions on credit quality categories see the Bank's 10-Q filed with the SEC on July 26, 2024. Category IV represents non-performing loans. Equipment Finance Portfolio Analysis Strong and diversified portfolio; Transportation sub-category showing sector-specific weakness Asset Quality Breakdown1 Equipment Finance (EF) loans diversified across industries EF comprised 28% of C&I loans and 10% of Total Loans at 12/31/2024 Transportation sector comprised 13% of EF, 3.6% of C&I, and 1.3% of Total Loans Stable asset quality in EF portfolio excluding Transportation sector, which is experiencing isolated industry weakness Equipment Finance excl. Transportation 12/31/2022 12/31/2023 12/31/2024 Total Portfolio $147.0 MM $226.4 MM $284.3 MM Category I 96% 96% 98% Category II 2% 1% 0% Category III 1% 1% 0% Category IV 1% 2% 2% Transportation 12/31/2022 12/31/2023 12/31/2024 Total Portfolio $50.8 MM $60.9 MM $41.2 MM Category I 98% 90% 87% Category II 1% 1% 0% Category III 0% 2% 0% Category IV 1% 7% 13%

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APPENDIX SUPPLEMENTAL DATA & NON-GAAP RECONCILIATIONS

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Offerings Designed Exclusively for Business and Wealth Management Services that meet the evolving needs of our growing client base

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Superior Client Satisfaction Rating Excellent Employee Satisfaction Drives Superior Client Satisfaction Note: Net promoter score assesses likelihood to recommend on an 11-point scale, where detractors (scores 0-6) are subtracted from promoters (scores 9-10), while passives (scores 7-8) are not considered. The score ranges from -100 to +100. Striving for Continuous Improvement Net Promoter Score is the most widely used measure of likelihood to recommend a company to others Anonymous survey conducted annually by a third party to assess client satisfaction Allows us to compare our performance against other leading financial institutions

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ESG Framework Environmental, social, and governance practices are integrated into our core business strategy Branch-lite model with only one location in each of the banking markets we serve Support hybrid and remote work options to reduce carbon emissions related to commuting (even prior to COVID) Reduced paper usage via implementation of Docusign Minimal technology eco-footprint by continued use of state-of-the art technology to minimize power consumption Annually recycle company-generated and employee-owned e-waste Employee e-waste recycling is now offered year-round Named to the national list of Top Workplaces USA for the third straight year Awarded nine culture of excellence awards by Top Workplaces Increased advisory board diversity (to over 40%) to enhance our business development efforts with a diverse client base in all markets Provide all employees with 8 hours of paid time to support volunteer efforts and give back to their communities in a meaningful way of their choosing Corporate Governance and Nominating Committee monitors key governance structure risks, effectiveness of the Board DEI policy practices and strategies, and oversight of the overall ESG program To ensure alignment with the Company's ESG principles, responsibility for Board delegated ESG risks and opportunities are defined in all committee charters Board diversity – 29% female and 14% ethnic or racial directors and 50% of standing committees chaired by female directors 86% director independence, and 100% committee membership independence

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Robust Liquidity and Capital Base Stable Core Deposit Base Substantial Liquidity Strong Capital Ratios (%) Source 12/31/2024 Short-term Investments $128,207 Collateral value of unencumbered pledged loans 444,453 Market value of unencumbered securities 310,125 Readily accessible liquidity 882,785 Fed fund lines 45,000 Excess brokered CD capacity (1) 981,463 Total Liquidity 1,909,248 Uninsured Deposits Collateralized Public Funds FDIC Insured Approximately 68% of deposits are insured or collateralized 1. Bank internal policy limits brokered CDs to 50% of total bank funding when combined with FHLB advances.

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Capital Strength 12/31/24 9/30/24 6/30/24 3/31/24 12/31/23 Total Regulatory Capital $421,639 $407,421 $392,359 $384,083 $375,440 Total Risk-Weighted Assets $3,491,626 $3,477,734 $3,425,925 $3,381,059 $3,356,247 Leverage Ratio 8.78% 8.68% 8.51% 8.45% 8.43% Common Equity Tier 1 Capital Ratio 9.10% 8.76% 8.64% 8.51% 8.38% Tier 1 Ratio 9.45% 9.11% 8.99% 8.86% 8.74% Total Capital Ratio 12.08% 11.72% 11.45% 11.36% 11.19% Total Shareholders' Equity $328,589 $311,982 $305,170 $297,788 $289,588 Tangible Common Shareholders' Equity $304,685 $288,156 $281,337 $273,846 $265,573 Total Shares Outstanding 8,293,928 8,295,017 8,294,589 8,306,573 8,314,778 Book Value Per Share $38.2 $36.2 $35.4 $34.4 $33.4 Tangible Book Value Per Share $36.7 $34.7 $33.9 $33.0 $31.9 Cash Dividends Per Share $0.25 $0.25 $0.25 $0.25 $0.2275 Regulatory capital ratios remain solid including a Total Capital Ratio of 12.08% and a Tier 1 Ratio of 9.45%. Tangible book value per share increased 23% annualized from the prior quarter and 15% from the prior year quarter. Quarterly cash dividend of $0.25 per share. HIGHLIGHTS

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Balanced Deposit Portfolio Diversified Product Base with Long-Tenured, Deep Client Relationships Longstanding deposit insurance options available through IntraFi and Reich & Tang to provide further security for our large clients Funding is augmented by non-callable wholesale deposits rather than non-relationship sourced funds Our deposit relationships span multiple industry segments Diverse deposit base has an average deposit relationship tenure of over 10 years History of offering competitive deposit rates supported by growth in higher-yielding commercial & industrial lending Nearly 50% of the top 50 deposit relationships also have a commercial loan relationship (Unaudited) As of (in thousands) December 31,2024 September 30,2024 June 30,2024 March 31,2024 December 31,2023 Non-interest-bearing transaction accounts $ 436,111 $ 428,012 $ 406,804 $ 400,267 $ 445,376 Interest-bearing transaction accounts 965,637 930,252 841,146 818,080 895,319 Money market accounts 809,695 817,129 837,569 813,467 711,245 Certificates of deposit 184,986 207,337 224,116 266,029 287,131 Wholesale deposits 710,711 587,217 575,548 457,563 457,708 Total deposits $ 3,107,140 $ 2,969,947 $ 2,885,183 $ 2,755,406 $ 2,796,779 Uninsured deposits $ 980,278 $ 1,088,496 $ 1,011,977 $ 995,428 $ 994,687 Less: uninsured deposits collateralized by pledged assets 6,864 10,755 34,810 16,622 17,051 Total uninsured, net of collateralized deposits 973,414 1,077,741 977,167 978,806 977,636 % of total deposits 31.3% 36.3% 33.9% 35.5% 35.0%

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Diversified Lending Products Double digit loan growth driven by stellar performance across all areas of the bank Note: Period end balances as of 12/31/2024 presented.

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Product Profile Target small to medium-sized companies Lines of credit and term loans focused on businesses with annual sales of up to $75.0 million Technology Initiatives Deploying client portal that enables easy and secure communications and document exchanges Note: Loan balances represent quarterly average data. Commercial Real Estate Lending Superior Talent with Business Expertise Building Relationships in Midwest Geographic Footprint

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Office loans focused in our bank markets and concentrated in Wisconsin Exceptional asset quality with no non-performing office loans in the portfolio 89% of all office loans have recourse Office loans consist of 69% Class A space Office represents 9% of total loans as of 12/31/24 Majority of office loan maturity terms are 2031 and beyond All office loans with 2031+ maturities are conventional fixed rate or fixed to the client via an interest rate swap Note: The office specific loan data presented in charts on this slide represents office loans greater than $3 million, which represents 76% of total office loans. Source: Q4 2024 CoStar market reports. For more detailed definitions on credit quality categories see the Bank's 10-K filed with the SEC on February 21, 2024. CRE Office Portfolio Analysis Exceptional credit quality on office loans throughout the Midwest Vacancy Rates: Madison = 6.0% Milwaukee = 11.3% Kansas City = 11.6% National = 13.9%

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Loans focused in our bank markets and concentrated in Wisconsin Exceptional asset quality with no non-performing loans in the portfolio Represents 17% of total loans 90% of all multi-family loans have recourse All multi-family loans with 2031+ maturities are conventional fixed rate or fixed to the client via an interest rate swap Source: Q4 2024 CoStar market reports. For more detailed definitions on credit quality categories see the Bank's 10-K filed with the SEC on February 21, 2024. Multi-Family Portfolio Analysis Exceptional credit quality on Multi-Family loans throughout the Midwest Vacancy Rates: Madison = 5.6% Milwaukee = 5.6% Kansas City = 8.0% National = 8.0%

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Product Profile Target small and medium companies in a variety of industries Financings range from $250,000 to $10 million Technology Initiatives Deploying client portal that enables easy and secure communications and document exchanges Note: Loan balances represent quarterly average data. C&I Lending Diversified commercial product offerings target companies nationwide

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Product Profile Target small to medium-sized companies in our Wisconsin, Kansas, and Missouri markets Comprehensive services for commercial clients to manage their cash and liquidity, including lockbox, accounts receivable collection services, electronic payment solutions, fraud protection, information reporting, reconciliation, and data integration solutions Technology Initiative Implemented a solution that auto-archives treasury management documentation which has immediately generated labor savings Note: Funding mix represents quarterly average balance data. Transaction Accounts include interest-bearing DDA, non-interest-bearing DDA and NOW accounts. Bank Wholesale Funding includes brokered deposits, deposits gathered through internet listing services and FHLB advances. Non-Transaction Accounts includes core CDs and money market accounts. "Cost of Funds" is a non-GAAP measure. See appendix for non-GAAP reconciliation schedules. Treasury Management Superior Talent with Business Expertise Building Relationships in Midwest Geographic Footprint

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Product Profile Fiduciary and investment manager for individual and corporate clients, creating and executing asset allocation strategies tailored to each client’s unique situation Holds full fiduciary powers and offers trust, estate, financial planning, and investment services, acting in a trustee or agent capacity as well as Employee Benefit/Retirement Plan services Also includes brokerage and custody-only services, for which we administer and safeguard assets but do not provide investment advice Technology Initiative Implementing client portal for new client onboarding Note: Total Assets Under Management & Administration represent period-end balances. Private Wealth Management Wealth Management Services for Businesses, Executives, and High Net Worth Individuals

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“Adjusted Net Interest Margin” is a non-GAAP measure representing net interest income excluding the fees in lieu of interest and other recurring, but volatile, components of net interest margin divided by average interest-earning assets excluding other recurring, but volatile, components of average interest-earning assets. Fees in lieu of interest are defined as prepayment fees, asset-based loan fees, non-accrual interest, and loan fee amortization. In the judgment of the Company’s management, the adjustments made to net interest income allow investors and analysts to better assess the Company’s net interest income in relation to its core client-facing loan and deposit rate changes by removing the volatility that is associated with these recurring but volatile components. The information provided below reconciles the net interest margin to its most comparable GAAP measure. Adjusted Net Interest Margin Non-GAAP Reconciliation                                                                                                                                                                                                      For the Three Months Ended (Dollars in Thousands) December 31, 2023 March 31, 2024 June 30, 2024 September 30, 2024 December 31, 2024 Interest income $54,762 $55,783 $57,910 $59,327 $60,110 Interest expense 25,222 26,272 27,370 28,320 26,962 Net interest income 29,540 29,511 30,540 31,007 33,148 Less fees in lieu of interest 1,121 849 1,306 1,002 2,359 Less FRB interest income and FHLB dividend income 1,466 1,436 959 841 1,062 Adjusted net interest income $26,953 $27,226 $28,275 $29,164 $29,727 Average interest-earning assets $3,199,485 $3,294,717 $3,347,027 $3,405,534 $3,516,390 Less Average FRB cash and FHLB stock 99,118 97,036 61,082 52,603 76,576 Less Average non-accrual loans and leases 18,602 20,540 19,807 18,954 19,077 Adjusted average interest-earning assets $3,081,765 $3,177,141 $3,266,138 $3,333,977 $3,420,737 Net interest margin 3.69% 3.58% 3.65% 3.64% 3.77% Adjusted net interest margin 3.50% 3.43% 3.46% 3.50% 3.48%

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"Adjusted Net Interest Income" is defined as net interest income less fees in lieu of interest and other recurring, but volatile components of net interest income . "Fees in Lieu of Interest" is defined as prepayment fees, asset-based loan fees, non-accrual interest, and loan fee amortization. We believe that this measure is important to many investors in the marketplace who are interested in the trends in our net interest margin. In compliance with applicable rules of the SEC, this non-GAAP measure is reconciled to net interest income, which is the most directly comparable GAAP financial measure. Adjusted Net Interest Income Non-GAAP Reconciliation                                                                                                                                                               For the Year Ended (Dollars in Thousands) December 31, 2019 December 31,2020 December 31,2021 December 31,2022 December 31,2023 December 31,2024 Net Interest income $69,855 $77,071 $84,662 $98,422 $112,588 $124,206 Less fees in lieu of interest 6,479 9,300 11,160 5,283 3,452 5,516 Less FRB and FHLB income 934 789 741 1,525 4,055 4,298 Adjusted net interest income (non-GAAP) $62,371 $66,850 $72,665 $91,440 $105,081 $114,392

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"Net Operating Income" is a non-GAAP financial measure. We believe net operating income allows investors to better assess the Company’s operating expenses in relation to its top line revenue by removing the volatility that is associated with certain one-time and other discrete items. In compliance with applicable rules of the SEC, this non-GAAP measure is reconciled to net income, which is the most directly comparable GAAP financial measure. Net Operating Income Non-GAAP Reconciliation                                                                                                                                                                                              For the Year Ended  (Dollars in Thousands) December 31, 2019 December 31, 2020 December 31, 2021 December 31, 2022 December 31, 2023 December 31, 2024 Net income $23,324 $16,978 $35,755 $40,858 $37,027 $44,245 Less income tax expense (1,175) (1,327) (11,275) (11,386) (10,112) (6,905) Less provision for credit losses (2,085) (16,808) 5,803 3,868 (8,182) (8,827)    Income before taxes and provision for credit losses (non-GAAP) 26,584 35,113 41,227 48,376 55,321 59,977 Less non-operating income    Net gain on sale of state tax credits - 275 - - - -    BOLI death benefit - - - 809 - -    Net (loss) gain on sale of securities (46) (4) 29 - (45) (8) Total non-operating income (non-GAAP) (46) 271 29 809 (45) (8) Less non-operating expense    Net loss on repossessed assets 224 383 15 49 12 168    Amortization of other intangible assets 40 35 25 - - -    Contribution to First Business Charitable Foundation - - - 809 - -    SBA recourse (benefit) provision 188 (278) (76) (188) 775 (104)    Tax credit investment impairment (recovery) 4,094 2,395 - 351 - 400    Loss on early extinguishment of debt - 744 - - - - Total non-operating expense (non-GAAP) 4,546 3,279 (36) 319 787 464 Add net tax credit benefit (non-GAAP) 1,352 969 - 338 1,206 1,630 Net operating income $32,528 $39,090 $41,162 $48,224 $57,359 $62,078

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‘‘Cost of Funds’’ is defined as total interest expense on deposits and FHLB advances, divided by the sum of total average deposits and average FHLB advances. We believe that this measure is important to many investors in the marketplace who are interested in the trends in our bank funding costs. The information provided below reconciles the cost of funds to its most comparable GAAP measure. Cost of Funds Non-GAAP Reconciliation                                                                                                                                                                                                                                             For the Three Months Ended (Dollars in Thousands) December 31, 2023 March 31, 2024 June 30, 2024 September 30, 2024 December 31, 2024    Interest expense on total interest-bearing deposits $22,644 $23,837 $24,676 $25,290 $24,120    Interest expense on FHLB advances 1,851 1,717 1,974 2,059 1,969    Total interest expense on deposits and FHLB advances $24,495 $25,554 $26,650 $27,349 $26,089 Average interest-bearing deposits $2,249,701 $2,360,573 $2,414,282 $2,466,313 $2,566,814 Average non-interest-bearing deposits 448,818 443,416 436,968 440,161 444,683 Average FHLB advances 301,773 287,307 294,043 278,103 270,476    Total average deposits and total average FHLB advances $3,000,292 $3,091,296 $3,145,293 $3,184,577 $3,281,969 Cost of funds 3.27% 3.31% 3.39% 3.44% 3.18%

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v3.24.4

Cover	Jan. 30, 2025
Cover [Abstract]
Document Type	8-K
Amendment Flag	false
Document Period End Date	Jan. 30, 2025
Entity File Number	001-34095
Entity Registrant Name	First Business Financial Services, Inc.
Entity Central Index Key	0001521951
Entity Tax Identification Number	39-1576570
Entity Incorporation, State or Country Code	WI
Entity Address, Address Line One	401 Charmany Drive
Entity Address, City or Town	Madison
Entity Address, State or Province	WI
Entity Address, Postal Zip Code	53719
City Area Code	608
Local Phone Number	238-8008
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	Common Stock, $0.01 par value
Trading Symbol	FBIZ
Security Exchange Name	NASDAQ
Entity Emerging Growth Company	false

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