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FAIR VALUE MEASUREMENTS
 6 Months Ended
Jun. 30, 2026
Fair Value Disclosures [Abstract]  
FAIR VALUE MEASUREMENTS
NOTE 13. FAIR VALUE MEASUREMENTS
The fair value of an asset or liability is the price that would be received by selling that asset or paid in transferring that liability (exit price) in an orderly transaction occurring in the principal market (or most advantageous market in the absence of a principal market) for such asset or liability. ASC Topic 820 “Fair Value Measurement” establishes a fair value hierarchy for valuation inputs that gives the highest priority to quoted prices in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The fair value hierarchy is as follows:
•Level 1 Inputs—Unadjusted quoted prices in active markets for identical assets or liabilities that Busey has the ability to access at the measurement date.
•Level 2 Inputs—Inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These might include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (such as interest rates, volatility, prepayment speeds, credit risks, etc.) or inputs that are derived principally from or corroborated by market data by correlation or other means.
•Level 3 Inputs—Unobservable inputs for estimating the fair values of assets or liabilities that reflect Busey’s own assumptions about the assumptions that market participants would use in pricing the assets or liabilities.
A description of the valuation methodologies used for instruments measured at fair value, as well as the general classification of such instruments pursuant to the valuation hierarchy, is set forth below. These valuation methodologies were applied to Busey’s assets and liabilities that are carried at fair value.
In general, fair value estimates are based upon quoted market prices, when available. If such quoted market prices are not available, fair values are estimated utilizing independent valuation techniques that consider identical or similar securities for which significant assumptions are derived primarily from or corroborated by observable data. Valuation adjustments may be made to ensure that financial instruments are recorded at their estimated fair values. These adjustments may include amounts to reflect, among other things, counterparty credit quality and the company's creditworthiness as well as unobservable parameters. Any such valuation adjustments are applied consistently over time. While management believes Busey's valuation methodologies are appropriate and consistent with other market participants, the use of different methodologies or assumptions to estimate the fair value of certain financial instruments could result in a different estimate of fair value at the reporting date.
Financial Assets and Financial Liabilities Measured at Fair Value on a Recurring Basis
Debt Securities Available for Sale
Debt securities classified as available for sale are reported at fair value, which is estimated using Level 2 inputs. Busey obtains fair value measurements from an independent pricing service. The independent pricing service utilizes evaluated pricing models that vary by asset class and incorporate available trade, bid, and other market information. Because many fixed income securities do not trade on a daily basis, the independent pricing service applies available information to prepare evaluations, with a focus on observable market data such as benchmark curves, benchmarking of like securities, sector groupings, and matrix pricing.
The independent pricing service uses model processes, such as the Option Adjusted Spread model, to assess interest rate impact and develop prepayment scenarios. Models and processes take into account market conventions. For each asset class, a team of evaluators gathers information from market sources and integrates relevant credit information, perceived market movements, and sector news into the evaluated pricing applications and models.
Market inputs that the independent pricing service normally seeks for evaluations of securities, listed in approximate order of priority, include: benchmark yields, reported trades, broker/dealer quotes, issuer spreads, two-sided markets, benchmark securities, bids, offers, and reference data including market research publications. The independent pricing service also monitors market indicators, industry, and economic events. For certain security types, additional inputs may be used or some of the market inputs may not be applicable. Evaluators may prioritize inputs differently on any given day for any security based on market conditions, and not all inputs listed are available for use in the evaluation process for each security evaluation on a given day. Because the data utilized was observable, the securities have been classified as Level 2.
Equity Securities
Equity securities are reported at fair value, which is estimated using Level 1 or Level 2 inputs. Fair value measurements of mutual funds or stock in active markets are estimated using unadjusted quoted prices for identical assets at the measurement date and are classified as Level 1. Fair value measurements of stock that are not active use quoted prices for identical or similar assets in markets and are classified as Level 2.
Derivative Assets and Derivative Liabilities
Busey’s derivative assets and derivative liabilities are reported at fair value, which is measured using Level 2 or Level 3 inputs. Fair values of derivative assets and liabilities are estimated based on prices that are obtained from a third-party which uses observable market inputs and, with the exception of risk participation agreements, are classified as Level 2. Due to the significance of unobservable inputs, derivative assets and liabilities related to risk participation agreements are classified as Level 3.
The following tables summarize financial assets and financial liabilities measured at estimated fair value on a recurring basis:
As of June 30, 2026
(dollars in thousands)Level 1
Inputs		Level 2
Inputs		Level 3
Inputs		Total
Fair Value
Debt securities available for sale:
Obligations of U.S. government corporations and agencies$— $105,771 $— $105,771 
Obligations of states and political subdivisions— 268,977 — 268,977 
Asset-backed securities— 227,006 — 227,006 
Commercial mortgage-backed securities— 149,122 — 149,122 
Residential mortgage-backed securities— 1,472,582 — 1,472,582 
Corporate debt securities— 41,709 — 41,709 
Equity securities174 16,223 — 16,397 
Derivative assets— 25,015 12 25,027 
Derivative liabilities— 44,494 29 44,523 
As of December 31, 2025
(dollars in thousands)Level 1
Inputs		Level 2
Inputs		Level 3
Inputs		Total
Fair Value
Debt securities available for sale:
Obligations of U.S. government corporations and agencies$— $112,046 $— $112,046 
Obligations of states and political subdivisions— 263,873 — 263,873 
Asset-backed securities— 265,580 — 265,580 
Commercial mortgage-backed securities— 132,942 — 132,942 
Residential mortgage-backed securities— 1,344,416 — 1,344,416 
Corporate debt securities— 43,691 — 43,691 
Equity securities155 14,761 — 14,916 
Derivative assets— 30,902 30 30,932 
Derivative liabilities— 42,155 65 42,220 
Activity for Busey's risk participation agreements, which are measured at estimated fair value on a recurring basis using Level 3 inputs, is summarized in the table below:
Three Months Ended June 30,Six Months Ended June 30,
(dollars in thousands)Location2026202520262025
Beginning Balance$(26)$(39)$(35)$5 
Gains recognized in earningsOther noninterest expense9 5 18 7 
Losses recognized in earnings1
Other noninterest income— (3)— (14)
Purchases— (26)— (26)
Sales— 18 — 24 
Assumed in business combinations2
— — — (41)
Ending Balance$(17)$(45)$(17)$(45)
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1.CrossFirst Bank, which First Busey operated as a separate banking subsidiary from the time of its acquisition on March 1, 2025, until it was merged with and into Busey Bank on June 20, 2025, recorded gains and losses on its risk participation agreements as other noninterest income. Throughout 2025, Busey accounted for the CrossFirst portfolio of risk participation agreements consistent with this methodology. Beginning in 2026, gains and losses recognized on Busey’s full portfolio of risk participation agreements, is recorded as other noninterest expense.
2.Represents risk participation agreements assumed in the CrossFirst acquisition.
Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis
Certain financial assets and financial liabilities are measured at estimated fair value on a non-recurring basis; that is, the instruments are not measured at estimated fair value on an ongoing basis but are subject to fair value adjustments in certain circumstances (for example, when there is evidence of impairment).
Loans Evaluated Individually
Busey does not record portfolio loans at estimated fair value on a recurring basis. However, periodically, a loan is evaluated individually and is reported at the estimated fair value of the underlying collateral, less estimated costs to sell, if repayment is expected solely from the collateral. If the estimated collateral value is not sufficient, a specific reserve is recorded. Collateral values are estimated using a combination of observable inputs, including recent appraisals, and unobservable inputs based on customized discounting criteria. Due to the significance of unobservable inputs, fair values of individually evaluated collateral dependent loans have been classified as Level 3.
OREO and Other Repossessed Assets
Non-financial assets measured at fair value, upon initial recognition or subsequent impairment, include OREO and other repossessed assets. OREO properties and other repossessed assets are measured using a combination of observable inputs, including recent appraisals, and unobservable inputs. Due to the significance of unobservable inputs, the estimated fair values of all OREO and other repossessed assets have been classified as Level 3.
Bank Property Held for Sale
Bank property held for sale represents certain banking center office buildings which Busey has closed and consolidated with other existing banking centers. Bank property held for sale is measured at the lower of amortized cost or estimated fair value less estimated costs to sell. Fair value estimates were based upon discounted appraisals or real estate listing prices. Due to the significance of unobservable inputs, estimated fair values of all bank property held for sale have been classified as Level 3. Bank property held for sale is included in premises and equipment, net on Busey’s Consolidated Balance Sheets (Unaudited).
The following tables summarize financial assets and financial liabilities measured at estimated fair value on a non-recurring basis:
As of June 30, 2026
(dollars in thousands)Level 1
Inputs		Level 2
Inputs		Level 3
Inputs		Total
Fair Value
Loans evaluated individually, net of related allowance$— $— $26,057 $26,057 
OREO and other repossessed assets with subsequent impairment— — 2,623 2,623 
Bank property held for sale with impairment— — 1,661 1,661 
As of December 31, 2025
(dollars in thousands)Level 1
Inputs		Level 2
Inputs		Level 3
Inputs		Total
Fair Value
Loans evaluated individually, net of related allowance$— $— $19,604 $19,604 
OREO and other repossessed assets with subsequent impairment— — 4,409 4,409 
Bank property held for sale with impairment— — 1,855 1,855 
The following tables present additional quantitative information about assets measured at estimated fair value on a non-recurring basis using Level 3 inputs:
As of June 30, 2026
(dollars in thousands)Fair ValueValuation
Techniques		Unobservable
Input		Range
(Weighted Average)
Loans evaluated individually, net of related allowance$26,057 Appraisal of collateralAppraisal adjustments
-1.6% to -100.0%
(-34.5)%
OREO and other repossessed assets with subsequent impairment2,623 Appraisal of collateralAppraisal adjustments
-6.3% to -24.1%
(-6.9)%
Bank property held for sale with impairment1,661 Appraisal of collateral or real estate listing priceAppraisal adjustments
-9.0% to -46.1%
(-36.1)%
As of December 31, 2025
(dollars in thousands)Fair ValueValuation
Techniques		Unobservable
Input		Range
(Weighted Average)
Loans evaluated individually, net of related allowance$19,604 Appraisal of collateralAppraisal adjustments
-1.6% to -100.0%
(-44.6)%
OREO and other repossessed assets with subsequent impairment4,409 Appraisal of collateralAppraisal adjustments
-2.8% to -24.1%
(-4.5)%
Bank property held for sale with impairment1,855 Appraisal of collateral or real estate listing priceAppraisal adjustments
-9.0% to -58.0%
(-39.4)%
Financial Assets and Financial Liabilities That Are Not Carried at Fair Value
Fair values of financial instruments that are not carried at fair value on Busey’s Consolidated Balance Sheets (Unaudited) were estimated as follows:
As of June 30, 2026As of December 31, 2025
(dollars in thousands)Carrying
Amount		Fair
Value		Carrying
Amount		Fair
Value
Financial assets
Level 1 inputs:
Cash and cash equivalents$665,373 $665,373 $280,227 $280,227 
Level 2 inputs:
Interest-bearing time deposits in other banks14,450 12,491 13,825 11,880 
Debt securities held to maturity703,988 579,303 746,385 625,957 
Loans held for sale8,660 8,729 5,752 5,886 
Restricted bank stock83,171 83,171 77,006 77,006 
Accrued interest receivable72,758 72,758 71,788 71,788 
Level 3 inputs:
Portfolio loans, net13,030,950 12,866,338 13,393,776 13,472,907 
Mortgage servicing rights1,500 5,818 1,459 5,176 
Other servicing rights1,985 2,222 2,086 2,193 
 
Financial liabilities
Level 2 inputs:
Time deposits$2,382,306 $2,373,388 $2,429,890 $2,425,290 
Securities sold under agreements to repurchase144,061 144,061 166,929 166,929 
Short-term borrowings28,333 28,092 — — 
Long-term borrowings95,325 94,562 113,806 113,853 
Junior subordinated debt owed to unconsolidated trusts62,473 58,363 77,328 71,407 
Accrued interest payable19,018 19,018 25,372 25,372 
Level 3 inputs:
Subordinated notes, net of unamortized issuance costs99,603 98,250 99,395 94,500