SB Financial Group, Inc.

Good morning and welcome to the SB Financial fourth quarter and full year 2025 conference call and webcast. I would like to inform you that this conference call is being recorded and that all participants are in a listen-only mode. We will begin with remarks by management and then open the conference up to the investment community for questions and answers. I will now turn the conference over to Sara Mikas with SB Financial. Go ahead, Sara.

Thank you, and good morning, everyone. I'd like to remind you that this conference call is being broadcast live over the internet and will be archived and available on our website at ir.yourstatebank.com. Joining me today are Mark Klein, Chairman, President, and CEO, Tony Cosentino, Chief Financial Officer, and Steve Walz, Chief Lending Officer. Today's presentation may contain forward-looking information. Cautionary statements about this information as well as reconciliations of non-GAAP financial measures are included in today's earnings release materials as well as our SEC filings. These materials are available on our website and we encourage participants to refer to them for a complete discussion of risk factors and forward-looking statements. These statements speak only as of the date made MSB Financial undertakes no obligation to update them. I will now turn the call over to Mr. Klein.

Thank you, Sarah, and good morning, everyone. Welcome to our fourth quarter 2025 conference call and webcast. The fourth quarter and full year 2025 results reflect the continued strong execution across our franchise, delivering one of the strongest earnings quarters and year in our history. This includes a stronger presence in our core markets and steady progress in select expansion ones. Notably, we achieved this performance in a year where industry-wide mortgage activity, including volume of state bank, remained clearly under pressure. Throughout the quarter and year, we focused on disciplined lending, balanced loan and core deposit growth, prudent expense management, and maintaining strong credit fundamentals while navigating a fairly competitive environment. As we pivot from 2025, we believe our well-capitalized balance sheet, diversified business lines and revenue model, sound asset quality, and disciplined approach to capital management positions us well to support prudent growth and long-term value creation for our shareholders. The highlights for the quarter and full year include net income of $3.9 million, diluted EPS of $0.63, up $0.08, or approximately 15%. compared to the prior year quarter. When considering the service rates recapture adjusted EPS at $0.65, marking our 60th consecutive quarter of profitability. For the full year, our GAAP EPS of $2.19 represents the second highest per share earning performance in the last 20 years, and a 27% lift over our 2024 EPS of $1.72, and 18% over our 2025 budget. Clearly a very successful year for SB Financial. Tangible book value per share ended the quarter at $18 up from $16 last year, or a 12.5% increase. Adjusted tangible book value now rests at $21.44 per share and drives our current market price to reflect an approximate 100% threshold. Net interest income for the quarter totaled $12.7 million, an increase of nearly 17% from the $10.9 million in the fourth quarter of 2024. From the linked quarter, net interest income increased 3.1% and for the year rose to $48.4 million, representing an increase of $8.5 million, or 21%. Interestingly, 50% came from a larger balance sheet and 50% from wider margins. Reoccurring net interest margin revenue now represents nearly 75% of our total revenue, reflecting a larger balance sheet and expanded margins as fee-based business line revenue pulled back from our historical average of 35% to just 26%. Loan growth for the quarter was $70 million, or an increase of 25% on an annualized basis. On a year-over-year basis, we delivered growth of $133.9 million, or 12.8%. and now marks seven consecutive quarters of sequential loan growth. Our trajectory has enabled us to also outpace our peer performers and those at the 75th percentile. Driving our acceleration was our meaningful commercial lending activity in and around the greater Columbus market of over $73 million this year, with a solid contribution also from our new ag lender located here in northern Ohio. Total deposits increased this quarter by 45 million or 14% on an annualized basis. On a year-over-year basis, our deposit growth escalated by nearly 155 million or 13%. This expansion includes 47 million related to the Marblehead acquisition. Strong organic deposit growth continued to support balance sheet expansion and liquidity. Deposit balances and client relationships at Marblehead have remained stable and retention trends have been well in line with our expectations. Excluding acquired balances, deposits grew 9.3% compared to the prior year, reflecting continuing engagement with our client base across all seven of our regional markets. Importantly, our balance sheet remains liquid and well positioned for continued growth. At quarter end, we held approximately 50 million in excess liquidity. and had ready access to $160 million in outstanding debt capacity, each providing meaningful flexibility to support organic growth, capital deployment, and potential strategic acquisitions. Total assets under our care expanded this quarter by $62 million, representing annualized growth of 7%. This quarterly growth was a derivative of our annual trend that enabled us to reach now the $3.6 billion mark. This number includes bank assets of $1.5 billion, a nearly 9,000 household residential servicing portfolio of $1.5 billion, and wealth assets of $566 million. Together, this diversified asset base provides meaningful revenue diversification and certainly supports performance across a number of varying market conditions. Mortgage originations for the quarter were $72.4 million down from the prior year, but up compared to the linked quarter. We do still see a solid pipeline in the $25 to $30 million range. Obviously, the pipeline can be extremely fluid as even a quarter point drop in rates would potentially move reluctant buyers off the sidelines into the market, albeit with limited housing inventory that we've discussed for a number of quarters. Operating expenses declined approximately 2.3% from the linked quarter and were up slightly compared to the prior year. Full-year expense growth, excluding the one-time merger cost, was 7.7%, well below the 15.1% full-year 2025 revenue growth, resulting in core operating leverage of two times. Asset quality metrics remain, continue to reflect the overall strength of the portfolio during the quarter, with non-performing loans, the total loan decline to 0.39%, down from both the length quarter and prior year period. Non-performing assets also decreased on both a sequential and year-over-year basis, reflecting continued progress in resolving problem credits and maintaining disciplined credit oversight. While we did see some isolated pressure in certain credit relationships, we are actively addressing and resolving those exposures to continue to make progress to sustain our overall credit quality. Our strategy remains anchored in our key five strategic initiatives, from growing and diversifying revenue greater footprint and scale for efficiency, a larger share of the client's wallet, which is all about scope, operational excellence, and, of course, always asset quality. Looking a little closer at revenue diversity, as I mentioned, mortgage originations totaled approximately $72.4 million during the quarter. While activity remains slightly below the prior year period, production continues to improve compared to earlier quarters in the year, reflecting gradual softening in Freddie Fannie fixed-rate saleable products. Clearly, we had higher expectations for the residential market this past year with a support team that has remained in place to deliver a far higher volume number. Overall, the $278 million in annual volume missed our budget level by approximately 28%, but we were pleased that compared to the prior year, volume was higher by over 8%. And most importantly, our loan sales volume eclipsed the 2024 level, by nearly 34 million or 16%. Also, 2025 did not provide the historical boost of volume that we typically experience from refinance activity. For the year, 73% of our volume was purchase activity with another 6% from construction, supplemented by 20% from refinance from both internal and external clients new to State Bank. On a positive note, the fourth quarter's resignations contained over 42% in refinance volume as clients took advantage of a window of several rate reductions during the quarter. Non-interest income was down by 18.6% from the prior year quarter at 3.7 million and down 12.6 from the late quarter. For the entire year, our non-interest income was approximately 17.1 million and right at recent year's levels. The decrease from the fourth quarter of 2024 is primarily driven by decreased mortgage servicing rights as well as other fee-based business line revenue. Peak Title made great strides throughout the year to not only expand contacts outside of State Bank but to also leverage internal referral resources, each contributing to a full-year improvement in revenue of $413,000 up to $2 million or an increase of 25%. and expansion in net income of 219,000, up 60% to 583,000. We have hinted at new initiatives within our wealth management group over several quarters that reflect the expanded resources and capabilities from our partnership with Advisory Alpha. We're excited to bring a number of their professionals, bench strength, and talents to our markets to help build our client base as well as inform the public on market dynamics and investment strategies. The latter being just one example of the expanded advice and product knowledge that will be brought to bear throughout our footprint beginning in 2026. On the scale front, Marblehead team that we acquired is now fully embedded with State Bank platform and operating under one unified operating model, allowing us to deepen the relationships and pursue new business opportunities in that market. The successful conversion of Marblehead's customers into our core system in October marked the final step in aligning operations and technology, and positions us to scale efficiently going forward. As a result, the acquisition has transitioned from now integration to execution, providing us with an established presence in a new market with nearly 2,500 deposit accounts that bear a weighted average rate of just 1.35% and provides a solid foundation for organic growth beyond the initial transactions. As noted earlier, deposit growth both inclusive and exclusive of acquired balances was an important contributor to earnings performance in 2025 with total deposits improving to 1.3 billion. The strength of our deposit base continues to support balance sheet liquidity and provides flexibility to fund our ongoing loan growth. This funding profile remains a key element in our ability to support clients while maintaining disciplined balance sheet management. Again, we have grown loans now for seven consecutive quarters with the 2025 annual growth rate of 12.8%, finishing well above our historical average of high single digits. Our continued success in the Columbus market is a model that we expect to translate more into our other six regions in 2026. Additionally, we have witnessed early success in the de novo expansions of Napoleon, Ohio and Angola, Indiana markets with nearly $15 million in loan growth during the quarter. Also, we are leveraging our strategic focus on the Fort Wayne, Indiana market with a new additional commercial lender. Fort Wayne continues to be a growth market that houses significant upside for organic balance sheet expansion in 2026 and well beyond. More scope in our relationships with our clients. During the quarter, we continue to build on our client-centric approach to growth, focusing on building durable relationships and expanding client engagement across all markets. As we continue to invest in both newer and established markets, we continue to evaluate how our physical presence, staffing, and resources are best positioned to support sustainable growth and solidify long-term client relationships. As we've noted in prior quarters, ongoing consolidation across our markets has continued to create opportunities to engage clients. In fact, this quarter we saw continued success, converting that activity into meaningful relationships and growth that after just eight months is bordering on $80 million in new loans and deposits to our company. Our focused calling efforts remain an important contributor to this growth initiative and continue to support both new and existing clients across our 20 community base. Center post of our operating model continues to rest in our ability to optimize interdependence and to ensure that no client in need of a full relationship is left behind. This past year, that optimization led to our seven business lines identifying nearly 1,400 referrals with 53% or 734 referrals successfully closing that delivered $92 million in new business for our company. Operational excellence. As we indicated in previous quarters, we believe that agricultural lending opportunities have begun to surface in many of our markets. The new agricultural lender we recently added is a highly seasoned professional with a sizable book and strong track record of production. When we combine this level of experience with our 25-year ag production leader, we further strengthen our potential and positions as well for continued growth in this sector. Interestingly, this initiative has already delivered funded loan growth of 19 million or 20% in that portfolio with another $3 million of core deposits. Finally, asset quality. Our asset quality remains one of our competitive advantages. It allows us to embrace measured credit risk opportunities by driving balance sheet growth while expanding margin revenue. As I mentioned, charge-offs. rose to four basis points from zero basis points in the third quarter, but were only two basis points for all of 2025. Non-performing assets totaled 4.7 million. We remain focused on maintaining our strong asset quality as demonstrated by our continued management of our criticized and classified loans, which stood at 5.7 million down from 5.8 million in the linked quarter and 6.4 million in the prior year. Our allowance for credit losses remained a robust 1.36% of total loans, now providing 352% coverage of non-performing assets. We expect to make more progress in the first half of 2026 to further reduce our NPL portfolio. We have workout plans in place that should deliver improved metrics with certainly minimal losses. Now I'd like to turn the call over to our CFO, Tony Costantino, for some additional comments on our quarterly performance. Tony?