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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_______________________________________________________________________

FORM 10-Q

_______________________________________________________________________

(Mark One)


x			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2026


o			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number: 001-38447

_______________________________________________________________________

BUSINESS FIRST BANCSHARES, INC.

(Exact name of registrant as specified in its charter)

_______________________________________________________________________


Louisiana			20-5340628
(State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification Number)

500 Laurel Street, Suite 101 Baton Rouge, Louisiana			70801
(Address of principal executive offices)			(Zip Code)

(225) 248-7600

(Registrant’s telephone number, including area code)

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, par value $1.00 per share	BFST	NASDAQ Global Select Market

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	o	Accelerated filer	x

Non-accelerated filer	o	Smaller reporting company	o

		Emerging growth company	o

If an emerging growth company, indicate by a 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. o

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. o

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No x

As of October 28, 2026, the issuer has outstanding 32,240,101 shares of common stock, par value $1.00 per share.

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BUSINESS FIRST BANCSHARES, INC.


PART I - FINANCIAL INFORMATION

Item 1.	Financial Statements	4

	Consolidated Balance Sheets as of September 30, 2026 (Unaudited) and December 31, 2025	4

	Unaudited Consolidated Statements of Income for the three and nine months ended September 30, 2026 and 2025	5

	Unaudited Consolidated Statements of Comprehensive Income (Loss) for the three and nine months ended September 30, 2026 and 2025	6

	Unaudited Consolidated Statements of Changes in Shareholders’ Equity for the three and nine months ended September 30, 2026 and 2025	7

	Unaudited Consolidated Statements of Cash Flows for the nine months ended September 30, 2026 and 2025	9

	Notes to Unaudited Consolidated Financial Statements	11

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	34

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	62

Item 4.	Controls and Procedures	62

PART II - OTHER INFORMATION

Item 1.	Legal Proceedings	64

Item 1A.	Risk Factors	64

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	64

Item 3.	Defaults Upon Senior Securities	64

Item 4.	Mine Safety Disclosures	65

Item 5.	Other Information	65

Item 6.	Exhibits	65

Signatures		67

Table of Contents

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements

BUSINESS FIRST BANCSHARES, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(Dollars in thousands, except per share data)


	September 30, 2026 (Unaudited)		December 31, 2025
ASSETS
Cash and Due from Banks	$	490,037	$	411,175
Federal Funds Sold	110,738		172,393
Securities Purchased Under Agreements to Resell	79,214		25,587
Securities Available for Sale, at Fair Values (Amortized Cost of $1,056,323 at September 30, 2026 and $1,031,432 at December 31, 2025)	986,704		989,229
Mortgage Loans Held for Sale	254		1,094
Loans and Lease Receivable, Net of Allowance for Loan Losses of $59,595 at September 30, 2026 and $53,959 at December 31, 2025	6,721,292		6,135,531
Premises and Equipment, Net	95,456		73,982
Accrued Interest Receivable	39,321		38,494
Other Equity Securities	39,984		49,342
Other Real Estate Owned	24,761		13,013
Cash Value of Life Insurance	140,148		120,292
Deferred Taxes	24,853		20,477
Goodwill	131,743		121,146
Core Deposit and Customer Intangible	31,983		14,497
Other Assets	39,474		28,488
Total Assets	$	8,955,962	$	8,214,740
LIABILITIES
Deposits:
Noninterest Bearing	$	1,605,682	$	1,322,074
Interest Bearing	5,771,116		5,376,516
Total Deposits	7,376,798		6,698,590

Securities Sold Under Agreements to Repurchase	24,896		22,622


Federal Home Loan Bank Borrowings	334,189		431,200
Subordinated Debt	114,250		92,530
Subordinated Debt - Trust Preferred Securities	9,689		5,000
Accrued Interest Payable	3,126		4,166
Other Liabilities	90,498		63,749
Total Liabilities	$	7,953,446	$	7,317,857

Commitments and Contingencies (See Note 9)

SHAREHOLDERS' EQUITY
Preferred Stock, No Par Value; 5,000,000 Shares Authorized; 72,010 Shares ($1,000 Liquidation Preference) Issued and Outstanding at both September 30, 2026 and December 31, 2025, respectively	$	71,930	$	71,930
Common Stock, $1 Par Value; 50,000,000 Shares Authorized; 32,345,723 and 29,510,668 Shares Issued and Outstanding at September 30, 2026 and December 31, 2025, respectively	32,346		29,511
Additional Paid-in Capital	572,968		502,155
Retained Earnings	380,182		326,574
Accumulated Other Comprehensive Loss	(54,910)		(33,287)
Total Shareholders' Equity	1,002,516		896,883
Total Liabilities and Shareholders' Equity	$	8,955,962	$	8,214,740

The accompanying notes are an integral part of these financial statements.

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BUSINESS FIRST BANCSHARES, INC. AND SUBSIDIARIES

UNAUDITED CONSOLIDATED STATEMENTS OF INCOME

(Dollars in thousands, except per share data)


	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2026		2025		2026		2025
Interest Income:
Interest and Fees on Loans	$	113,263	$	106,662	$	334,189	$	313,682
Interest and Dividends on Non-taxable Securities	1,775		2,924		5,373		5,046
Interest and Dividends on Taxable Securities	7,432		4,630		21,400		16,028
Interest on Federal Funds Sold and Due From Banks	5,047		4,472		14,699		12,475
Total Interest Income	127,517		118,688		375,661		347,231
Interest Expense:
Interest on Deposits	41,511		43,358		125,520		127,343
Interest on Borrowings	5,342		6,054		16,438		17,587
Total Interest Expense	46,853		49,412		141,958		144,930
Net Interest Income	80,664		69,276		233,703		202,301
Provision for Credit Losses	1,938		3,183		6,207		8,220
Net Interest Income after Provision for Credit Losses	78,726		66,093		227,496		194,081
Other Income:
Service Charges on Deposit Accounts	3,340		2,565		9,679		8,058
(Loss) Gain on Sales of Securities	(21)		77		53		29
Gain on Sales of Loans	814		624		3,738		2,661
Other Income	8,379		8,405		27,059		28,564
Total Other Income	12,512		11,671		40,529		39,312
Other Expenses:
Salaries and Employee Benefits	32,582		27,613		98,741		85,427
Occupancy and Equipment Expense	10,078		7,284		26,479		21,802
Merger and Conversion-Related Expense	1,395		477		3,075		937
Other Expenses	16,410		13,508		49,166		42,500
Total Other Expenses	60,465		48,882		177,461		150,666
Income Before Income Taxes	30,773		28,882		90,564		82,727
Provision for Income Taxes	6,221		6,026		18,273		17,225
Net Income	24,552		22,856		72,291		65,502
Preferred Stock Dividends	1,351		1,351		4,051		4,051
Net Income Available to Common Shareholders	$	23,201	$	21,505	$	68,240	$	61,451
Earnings Per Common Share:
Basic	$	0.71	$	0.73	$	2.10	$	2.09
Diluted	$	0.71	$	0.73	$	2.08	$	2.08

The accompanying notes are an integral part of these financial statements.

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BUSINESS FIRST BANCSHARES, INC. AND SUBSIDIARIES

UNAUDITED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(Dollars in thousands)


	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2026		2025		2026		2025
Consolidated Net Income	$	24,552	$	22,856	$	72,291	$	65,502

Other Comprehensive Income (Loss):
Unrealized (Loss) Gain on Investment Securities	(24,224)		14,454		(27,363)		33,716

Reclassification Adjustment for Losses (Gains) on Sale of AFS Investment Securities Included in Net Income	21		(77)		(53)		(29)
Income Tax Effect	5,115		(3,038)		5,793		(7,118)
Other Comprehensive (Loss) Income	(19,088)		11,339		(21,623)		26,569
Consolidated Comprehensive Income	$	5,464	$	34,195	$	50,668	$	92,071

The accompanying notes are an integral part of these financial statements.

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BUSINESS FIRST BANCSHARES, INC. AND SUBSIDIARIES

UNAUDITED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY

FOR THE THREE MONTHS ENDED September 30, 2026 AND 2025

(Dollars in thousands, except per share data)


	Preferred Stock		Common Stock		Additional Paid-In Capital		Retained Earnings		Accumulated Other Comprehensive Income (Loss)		Total Shareholders' Equity
Balances at June 30, 2025	$	71,930	$	29,603	$	502,046	$	292,629	$	(47,768)	$	848,440
Comprehensive Income:
Net Income	—		—		—		22,856		—		22,856
Other Comprehensive Income	—		—		—		—		11,339		11,339
Cash Dividends Declared on Preferred Stock, $18.75 Per Share	—		—		—		(1,351)		—		(1,351)
Cash Dividends Declared on Common Stock, $0.14 Per Share	—		—		—		(4,135)		—		(4,135)

Equity Based Compensation, Net of Shares Withheld to Cover Taxes	—		12		1,279		—		—		1,291
Balances at September 30, 2025	$	71,930	$	29,615	$	503,325	$	309,999	$	(36,429)	$	878,440

Balances at June 30, 2026	$	71,930	$	32,536	$	578,087	$	361,846	$	(35,822)	$	1,008,577
Comprehensive Income:
Net Income	—		—		—		24,552		—		24,552
Other Comprehensive Loss	—		—		—		—		(19,088)		(19,088)
Cash Dividends Declared on Preferred Stock, $18.75 Per Share	—		—		—		(1,351)		—		(1,351)
Cash Dividends Declared on Common Stock, $0.15 Per Share	—		—		—		(4,865)		—		(4,865)

Equity Based Compensation, Net of Shares Withheld to Cover Taxes	—		14		966		—		—		980
Stock Repurchases	—		(204)		(6,085)		—		—		(6,289)
Balances at September 30, 2026	$	71,930	$	32,346	$	572,968	$	380,182	$	(54,910)	$	1,002,516

The accompanying notes are an integral part of these financial statements

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BUSINESS FIRST BANCSHARES, INC. AND SUBSIDIARIES

UNAUDITED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY

FOR THE NINE MONTHS ENDED September 30, 2026 AND 2025

(Dollars in thousands, except per share data)


	Preferred Stock		Common Stock		Additional Paid-In Capital		Retained Earnings		Accumulated Other Comprehensive Income (Loss)		Total Shareholders' Equity
Balances at December 31, 2024	$	71,930	$	29,552	$	500,024	$	260,958	$	(62,998)	$	799,466

Comprehensive Income:
Net Income	—		—		—		65,502		—		65,502
Other Comprehensive Income	—		—		—		—		26,569		26,569
Cash Dividends Declared on Preferred Stock, $56.25 Per Share	—		—		—		(4,051)		—		(4,051)
Cash Dividends Declared on Common Stock, $0.42 Per Share	—		—		—		(12,410)		—		(12,410)

Equity Based Compensation, Net of Shares Withheld to Cover Taxes	—		63		3,301		—		—		3,364

Balances at September 30, 2025	$	71,930	$	29,615	$	503,325	$	309,999	$	(36,429)	$	878,440

Balances at December 31, 2025	$	71,930	$	29,511	$	502,155	$	326,574	$	(33,287)	$	896,883

Comprehensive Income:
Net Income	—		—		—		72,291		—		72,291
Other Comprehensive Loss	—		—		—		—		(21,623)		(21,623)
Cash Dividends Declared on Preferred Stock, $56.25 Per Share	—		—		—		(4,051)		—		(4,051)
Cash Dividends Declared on Common Stock, $0.45 Per Share	—		—		—		(14,632)		—		(14,632)
Stock Issuance	—		3,192		80,256		—		—		83,448
Equity Based Compensation, Net of Shares Withheld to Cover Taxes	—		123		3,929		—		—		4,052
Stock Repurchase	—		(480)		(13,372)		—		—		(13,852)
Balances at September 30, 2026	$	71,930	$	32,346	$	572,968	$	380,182	$	(54,910)	$	1,002,516

The accompanying notes are an integral part of these financial statements.

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BUSINESS FIRST BANCSHARES, INC. AND SUBSIDIARIES

UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Dollars in thousands)


	For the Nine Months Ended September 30,
	2026		2025
Cash Flows From Operating Activities:
Consolidated Net Income	$	72,291	$	65,502
Adjustments to Reconcile Net Income to Net Cash Provided by Operating Activities:
Provision for Credit Losses	6,207		8,220
Depreciation and Amortization of Premises and Equipment	4,944		4,270
Net Amortization (Accretion) of Purchase Accounting Adjustments	74		(1,362)
Equity Based Compensation	4,052		3,364
Net (Accretion) Amortization of Securities	(728)		736
Gain on Sales of Securities	(53)		(29)
Gain on Sale of Loans	(1,220)		(807)
Income on Other Equity Securities	(816)		(1,496)
Loss on Sale of Other Real Estate Owned, Net of Writedowns	1,293		60

Gain on Disposal of Premises and Equipment	(28)		(155)
Increase in Cash Value of Life Insurance	(2,712)		(2,367)
Deferred Income Tax Expense	562		1,084
Gain on Extinguishment/Redemption of Debt	(545)		(630)
Gain on Sale of Banking Center	—		(3,360)
Changes in Assets and Liabilities:
Decrease (Increase) in Accrued Interest Receivable	2,037		(1,313)
Increase in Other Assets	(5,485)		(6,326)
Decrease in Accrued Interest Payable	(1,533)		(1,857)
Increase in Other Liabilities	19,156		11,467
Net Cash Provided by Operating Activities	97,496		75,001

Cash Flows From Investing Activities:
Purchases of Securities Available for Sale	(123,191)		(154,865)
Proceeds from Maturities / Sales of Securities Available for Sale	67,566		36,493
Proceeds from Paydowns of Securities Available for Sale	76,562		58,963
Net Cash Received in Acquisitions	90,702		—
Net Cash Paid in Sale of Banking Center	—		(43,084)
Proceeds from Sale of Loans	83,304		—
Purchases of Other Equity Securities	(16,271)		(9,751)
Redemption of Other Equity Securities	28,091		8,034
Purchase of Life Insurance	(5,585)		—
Proceeds from Death Benefit of Cash Value of Life Insurance	—		503
Net Increase in Loans	(111,808)		(58,890)
Net Purchases of Premises and Equipment	(487)		(1,623)

Proceeds from Sales of Other Real Estate	3,322		4,643
Net (Increase) Decrease in Securities Purchased Under Agreements to Resell	(53,627)		25,317
Net Decrease in Federal Funds Sold	61,655		96,566
Net Cash Provided by (Used in) Investing Activities	100,233		(37,694)

(CONTINUED)

Table of Contents


	For the Nine Months Ended September 30,
	2026		2025
Cash Flows From Financing Activities:
Net (Decrease) Increase in Deposits	(6,785)		46,812
Net Increase in Securities Sold Under Agreements to Repurchase	2,274		7,275

Net (Repayments) Advances on Short-Term Federal Home Loan Bank Borrowings	(40,000)		48,000
Repayments on Long-Term Federal Home Loan Bank Borrowings	(59,894)		(36,467)

Proceeds from Issuance of Subordinated Debt	85,000		—
Repayment of Subordinated Debt	(66,927)		(6,485)




Repurchase of Common Stock	(13,852)		—
Payment of Dividends on Preferred Stock	(4,051)		(4,051)
Payment of Dividends on Common Stock	(14,632)		(12,410)
Net Cash (Used in) Provided by Financing Activities	(118,867)		42,674
Net Increase in Cash and Due From Banks	78,862		79,981
Cash and Due From Banks at Beginning of Period	411,175		319,098
Cash and Due From Banks at End of Period	$	490,037	$	399,079

Supplemental Disclosures for Cash Flow Information:
Cash Payments for:
Interest on Deposits	$	126,736	$	129,191
Interest on Borrowings	$	16,755	$	17,644
Income Tax Payments	$	17,547	$	16,847

Supplemental Schedule for Noncash Investing and Financing Activities:
Change in the Unrealized (Loss) Gain on Securities Available for Sale	$	(27,416)	$	33,687

Change in Deferred Tax Effect on the Unrealized Loss (Gain) on Securities Available for Sale	$	5,793	$	(7,118)
Transfer of Loans to Other Real Estate	$	16,363	$	15,940
Acquisitions:
Fair Value of Tangible Assets Acquired	$	758,838	$	—
Other Intangible Assets Acquired	20,719		—
Liabilities Assumed	699,903		—
Net Identifiable Assets Acquired Over Liabilities Assumed	$	79,654	$	—

The accompanying notes are an integral part of these financial statements.

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BUSINESS FIRST BANCSHARES, INC. AND SUBSIDIARIES

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

Note 1– Basis of Presentation –

The unaudited consolidated financial statements include the accounts of Business First Bancshares, Inc. (the “Company”) and its five direct, wholly-owned subsidiaries, b1BANK (the “Bank”), Coastal Commerce Statutory Trust I, Progressive Statutory Trust I, Progressive Statutory Trust II, and b1Capital, Inc.; and the Bank’s wholly-owned subsidiaries, Business First Insurance, LLC, Smith Shellnut Wilson, LLC ("SSW"), Waterstone LSP, LLC ("Waterstone"), and b1 Securities, LLC ("b1Securities"). The Bank operates out of full-service banking centers and loan production offices in markets across Louisiana, the Dallas/Fort Worth metroplex and Houston, Texas. As a state bank, it is subject to regulation by the Office of Financial Institutions (“OFI”), State of Louisiana, and the Federal Deposit Insurance Corporation (“FDIC”) and undergoes periodic examinations by these agencies. The Company is also regulated by the Federal Reserve and is subject to periodic examinations.

In the opinion of management, the accompanying unaudited consolidated financial statements contain all adjustments necessary to present fairly the financial results for the periods presented, and all such adjustments are of a normal recurring nature. All material intercompany transactions are eliminated. The results of operations for the interim periods are not necessarily indicative of the results to be expected for the entire year.

These interim consolidated financial statements have been prepared according to the rules and regulations of the Securities and Exchange Commission and, therefore, certain information and footnote disclosures normally presented in accordance with United States (“U.S.”) generally accepted accounting principles (“GAAP”) have been omitted or abbreviated. These interim financial statements should be read in conjunction with the audited consolidated financial statements and footnote disclosures for the Company’s previously filed Form 10-K for the year ended December 31, 2025.

Preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying disclosures. These estimates are based on management’s best knowledge of current events and actions the Company may undertake in the future. Critical accounting estimates that are particularly susceptible to significant change for the Company include the determination of the acquired loans, allowance for credit losses and purchase accounting adjustments (other than loans). Other estimates include goodwill, fair value of financial instruments, investment securities and the assessment of income taxes. Management does not anticipate any material changes to estimates in the near term. Factors that may cause sensitivity to the aforementioned estimates include but are not limited to: external market factors such as market interest rates and employment rates, changes to operating policies and procedures, economic conditions in the Company’s markets, and changes in applicable banking regulations. Actual results may ultimately differ from estimates.

Accounting Standards Adopted in Current Period

ASU 2025-08, "Financial Instruments – Credit Losses (Topic 326), Purchased Loans.” The updates in ASU 2025-08 amend the guidance in ASC 326 on the accounting for certain purchased loans. Under the ASU, entities must account for acquired loans (excluding credit cards) that meet certain criteria at acquisition (“purchased seasoned loans”) by recognizing them at their purchase price plus an allowance for expected credit losses (i.e., the gross-up approach). All non-purchased credit deteriorated (“non-PCD”) loans (excluding credit cards) that are acquired in a business combination are deemed seasoned. Other non-PCD loans (excluding credit cards) are seasoned if they were purchased at least 90 days after origination and the acquirer was not involved in the origination of the loans. The ASU’s amendments align the accounting for purchased seasoned loans with the treatment of financial assets purchased with more-than-insignificant credit deterioration since origination (“PCD assets”).

The Company early adopted the amendments effective January 1, 2026, on a prospective basis. The Progressive acquisition disclosures contained in Note 2, as well as the allowance measurements reflected in Note 5 incorporate the updated guidance.

Accounting Standards Not Yet Adopted

None

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BUSINESS FIRST BANCSHARES, INC. AND SUBSIDIARIES

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

Reclassifications

Certain reclassifications may have been made to conform to reporting in 2026. These reclassifications did not materially impact the Company's consolidated financial statements.

Note 2– Mergers and Acquisitions –

Progressive Bancorp, Inc.

On January 1, 2026, the Company consummated the merger of Progressive Bancorp, Inc. (“Progressive”), headquartered in Monroe, Louisiana, with and into the Company, pursuant to the terms of that certain Agreement and Plan of Reorganization (the “Reorganization Agreement”), dated as of July 7, 2025, by and between the Company and Progressive (the "Merger"). Also on January 1, 2026, Progressive's wholly owned banking subsidiary, Progressive Bank, was merged with and into b1BANK. Pursuant to the terms of the Reorganization Agreement, upon consummation of the Merger, the Company issued 3,192,367 shares of its common stock to the former shareholders of Progressive. At December 31, 2025, Progressive reported $773.8 million in total assets, $597.2 million in loans and $684.9 million in deposits.

The following table reflects the consideration paid for Progressive's net assets and the identifiable assets purchased and liabilities assumed at their fair values as of January 1, 2026. The fair values are provisional estimates and may be adjusted for a period of up to one year from the date of acquisition if new information is obtained about facts and circumstances that existed as of the acquisition date that, if known, would have affected the measurement of the amounts recognized as of that date.


Cost and Allocation of Purchase Price for Progressive Bancorp, Inc. (Progressive):
(Dollars in thousands, except per share data)
Purchase Price:
Shares Issued to Progressive's Shareholders on January 1, 2026	3,192,367
Closing Stock Price on December 31, 2025	$	26.14
Total Stock Issued	$	83,448
Partial Shares Paid in Cash	3

Total Purchase Price	$	83,451
Net Assets Acquired:
Cash and Cash Equivalents	$	93,255
Securities Available for Sale	45,047
Loans and Leases Receivable, Net of Allowance	573,919
Premises and Equipment, Net	25,903
Cash Value of Life Insurance	11,559
Core Deposit Intangible	15,950
Other Assets	8,988
Total Assets	774,621

Deposits	684,773
Borrowings	7,538
Other Liabilities	7,592
Total Liabilities	699,903
Net Assets Acquired	74,718
Goodwill Resulting from Merger	$	8,733

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BUSINESS FIRST BANCSHARES, INC. AND SUBSIDIARIES

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

The Company has recorded approximately $6.9 million and $3.8 million of acquisition-related costs within merger and conversion-related expenses, salaries and benefits, and occupancy and equipment expense for the nine months ended September 30, 2026, and year ended December 31, 2025, respectively.

The following is a description of the methods used to determine the fair values of significant assets acquired and liabilities assumed presented above.

Cash and Cash Equivalents: The carrying amount of these assets was a reasonable estimate of fair value based on the short-term nature of these assets.

Securities Available for Sale: Fair values for securities were based on quoted market prices, where available. If quoted market prices were not available, fair value estimates were based on observable inputs including quoted market prices for similar instruments, quoted market prices that were not in an active market or other inputs that were observable in the market. In the absence of observable inputs, fair value was estimated based on pricing models/estimations.

Loans and Leases Receivable: Fair values for loans were based on a discounted cash flow methodology that considered factors including, but not limited to, loan type, classification status, remaining term, prepayment speed, and current discount rates. The discount rates used for loans were based on current market rates for new originations of comparable loans and included adjustments for any liquidity concerns. The discount rate did not include an explicit factor for credit losses, as that was included within the estimated cash flows. As discussed in Note 1, the Company adopted ASU 2025-08, which requires a calculation and application of Day 1 allowance for non-PCD loans, as well as PCD loans. The Day 1 allowance amounts are applied on a gross basis.

Acquired loans are evaluated as either purchased with a more-than insignificant amount of credit deterioration (“PCD”) or an insignificant amount of credit deterioration (“non-PCD”) at acquisition, based upon management’s assessment of whether or not a loan has experienced more than insignificant credit deterioration since origination. This evaluation is completed by management using a variety of factors, including individual loan characteristics as well as industry type and collateral evaluation, among other factors. At acquisition, management designated loans with a fair value of $8.0 million as PCD. The fair value was inclusive of a $6.9 million PCD allowance and $750,000 non-credit fair value discount from the acquired contractual value.

The remainder of the Progressive loan portfolio, with a fair value of $565.9 million at acquisition included a non-PCD allowance of $2.4 million and a non-credit fair value discount of $13.7 million from the acquired contractual value.

Core Deposit Intangible (“CDI”): The fair value for core deposit intangible assets was estimated based on a discounted cash flow methodology that gave appropriate consideration to expected customer attrition rates, net maintenance cost of the deposit base, including interest cost, and alternative cost of funds. The CDI is being amortized over 10 years based upon the period over which estimated economic benefits are estimated to be received.

Deposits: The fair values used for the demand and savings deposits, by definition, equal the amount payable on demand at the acquisition date. Fair values for time deposits were estimated using a discounted cash flow analysis, that applied interest rates currently being offered to the contractual interest rates on such time deposits.

Borrowings: Fair values for borrowings were based on estimated market rates over the remaining terms of the subordinated debt issuances.

Pro forma tables for Progressive have not been presented because the acquisition was not material to the Company's consolidated financial statements.

American Planning Corporation

On June 29, 2026, the Company consummated the acquisition of American Planning Corporation (“APC”) for $6.8 million, of which $2.6 million was paid in cash and $4.3 million of subordinated debt was issued. As part of the transaction, the Company recorded a customer intangible of $4.8 million to be amortized over a ten-year period and $1.9 million in goodwill.

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Note 3– Earnings per Common Share –

Basic earnings per share (“EPS”) represents income available to common shareholders divided by the weighted average number of common shares outstanding; no dilution for any potentially convertible shares is included in the calculation. Diluted EPS reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that then shared in the earnings of the Company. The potential common shares that may be issued by the Company relate to outstanding stock options, unvested restricted stock awards (“RSAs”), unvested restricted stock units (“RSUs”) and performance shares, excluding any that were antidilutive. In addition, nonvested share-based payment awards that contain nonforfeitable rights to dividends or dividend equivalents are considered participating securities and are included in the computation of EPS pursuant to the two-class method.


	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
(Dollars in thousands, except per share data)	2026		2025		2026		2025

Numerator:
Net Income	$	24,552	$	22,856	$	72,291	$	65,502
Less: Preferred Stock Dividends	1,351		1,351		4,051		4,051
Net Income Available to Common Shares	$	23,201	$	21,505	$	68,240	$	61,451
Denominator:
Weighted Average Common Shares Outstanding	32,504,217		29,544,425		32,558,017		29,363,138
Dilutive Effect of Stock Options and RSAs	226,706		112,214		208,611		131,911
Weighted Average Dilutive Common Shares	32,730,923		29,656,639		32,766,628		29,495,049
Basic Earnings Per Common Share From Net Income Available to Common Shares	$	0.71	$	0.73	$	2.10	$	2.09
Diluted Earnings Per Common Share From Net Income Available to Common Shares	$	0.71	$	0.73	$	2.08	$	2.08

Note 4– Securities –

The amortized cost and fair values of securities available for sale as of September 30, 2026, and December 31, 2025 are summarized as follows:


	September 30, 2026
(Dollars in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
U.S. Treasury Securities	$	19,684	$	—	$	237	$	19,447
U.S. Government Agencies	250		—		1		249
Corporate Securities	87,062		142		2,016		85,188
Mortgage-Backed Securities	694,677		169		43,191		651,655
Municipal Securities	254,650		6		24,491		230,165
Total Securities Available for Sale	$	1,056,323	$	317	$	69,936	$	986,704

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	December 31, 2025
(Dollars in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
U.S. Treasury Securities	$	17,571	$	—	$	293	$	17,278
U.S. Government Agencies	10,070		—		196		9,874
Corporate Securities	38,324		377		1,639		37,062
Mortgage-Backed Securities	674,211		3,153		27,273		650,091
Municipal Securities	291,256		536		16,868		274,924
Total Securities Available for Sale	$	1,031,432	$	4,066	$	46,269	$	989,229

The following tables present a summary of securities with gross unrealized losses and fair values at September 30, 2026, and December 31, 2025, aggregated by investment category and length of time in a continued unrealized loss position. Due to the nature of these investments and current prevailing market prices, these unrealized losses are considered non-credit related.


	September 30, 2026
	Less Than 12 Months				12 Months or Greater				Total
(Dollars in thousands)	Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses
U.S. Treasury Securities	$	9,493	$	178	$	9,954	$	59	$	19,447	$	237
U.S. Government Agencies	249		1		—		—		249		1
Corporate Securities	52,222		574		18,835		1,442		71,057		2,016
Mortgage-Backed Securities	339,383		13,380		265,776		29,811		605,159		43,191
Municipal Securities	56,363		2,464		165,259		22,027		221,622		24,491
Total Securities Available for Sale	$	457,710	$	16,597	$	459,824	$	53,339	$	917,534	$	69,936


	December 31, 2025
	Less Than 12 Months				12 Months or Greater				Total
(Dollars in thousands)	Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses
U.S. Treasury Securities	$	—	$	—	$	17,278	$	293	$	17,278	$	293
U.S. Government Agencies	—		—		9,874		196		9,874		196
Corporate Securities	2,580		2		21,086		1,637		23,666		1,639
Mortgage-Backed Securities	83,844		506		336,946		26,767		420,790		27,273
Municipal Securities	12,939		57		210,329		16,811		223,268		16,868
Total Securities Available for Sale	$	99,363	$	565	$	595,513	$	45,704	$	694,876	$	46,269

As of September 30, 2026, and December 31, 2025, respectively, no allowance for credit losses was recognized on available for sale securities in an unrealized loss position as management does not believe any of the securities are impaired due to credit quality. This determination is based on the Company’s analysis of the underlying risk characteristics including credit ratings, historical loss experience, and other qualitative factors. Further, the securities continue to make principal and interest payments under their contractual terms and management does not have the intent to sell any of the securities and believes that it is more likely than not that the Company will not have to sell any

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such securities before a recovery of amortized cost basis. Therefore, the Company has determined the unrealized losses are due to changes in market interest rates compared to rates when the securities were acquired.

The amortized cost and fair values of securities available for sale as of September 30, 2026, by contractual maturity are shown below. Actual maturities may differ from contractual maturities in mortgage-backed securities because the mortgages underlying the securities may be called or repaid without any penalties.


(Dollars in thousands)	Amortized Cost		Fair Value
Less Than One Year	$	34,509	$	34,216
One to Five Years	238,889		221,824
Over Five to Ten Years	364,452		335,673
Over Ten Years	418,473		394,991
Total Securities Available for Sale	$	1,056,323	$	986,704

Securities available for sale with a fair value of $431.3 million and $398.3 million were pledged as collateral on public deposits and for other purposes as required or permitted by law as of September 30, 2026, and December 31, 2025, respectively.

For the three months ended September 30, 2026, the Company recognized gross losses of $21,000 and no gross gains for securities available for sale, compared to gross gains of $77,000 and no gross losses for the same period in 2025. There were no impairment charges related to credit losses included in gross realized losses for the three months ended September 30, 2026 and 2025.

For the nine months ended September 30, 2026, gross gains of $88,000 and gross losses of $35,000 were recognized for securities available for sale, compared to gross gains of $80,000 and gross losses of $51,000 for the same period in 2025. There were no impairment charges related to credit losses included in gross realized losses for the nine months ended September 30, 2026 and 2025.

At September 30, 2026, and December 31, 2025, accrued interest receivable on securities was $4.7 million and $5.3 million, respectively, and is included within accrued interest receivable on the consolidated balance sheets.

Note 5– Loans and the Allowance for Credit Losses –

Loans receivable at September 30, 2026, and December 31, 2025, are summarized as follows:


(Dollars in thousands)	September 30, 2026		December 31, 2025
Real Estate Loans:
Commercial	$	2,896,707	$	2,611,279
Construction	774,170		639,069
Residential	1,048,400		944,065
Total Real Estate Loans	4,719,277		4,194,413
Commercial	1,990,998		1,921,833
Consumer and Other	70,612		73,244
Total Loans Held for Investment	6,780,887		6,189,490

Less:
Allowance for Loan Losses	(59,595)		(53,959)
Net Loans	$	6,721,292	$	6,135,531

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NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

The performing 1-4 family residential, multi-family residential, commercial real estate, and commercial loans, are pledged under a blanket lien as collateral securing advances from the FHLB at September 30, 2026, and December 31, 2025. Commercial and agricultural loans are pledged against the Federal Reserve Banks’ (“FRB”) discount window as of September 30, 2026, and December 31, 2025.

Net deferred loan origination fees were $9.9 million and $11.4 million at September 30, 2026, and December 31, 2025, respectively, and are netted in their respective loan categories above. In addition to loans issued in the normal course of business, the Company considers overdrafts on customer deposit accounts to be loans and reclassifies overdrafts as loans in its consolidated balance sheets. At September 30, 2026, and December 31, 2025, overdrafts of $1.3 million and $7.9 million, respectively, have been reclassified to loans.

The Bank is the lead lender on participations sold, without recourse, to other financial institutions which amounts are not included in the consolidated balance sheets. The unpaid principal balances of mortgages and other loans serviced for others were approximately $724.0 million and $643.8 million at September 30, 2026 and December 31, 2025, respectively. The Company had servicing rights of $1.6 million and $956,000 recorded at September 30, 2026, and December 31, 2025, respectively, and is recorded within other assets.

The Bank grants loans and extensions of credit to individuals and a variety of businesses and corporations located in its general market areas throughout Louisiana and Texas. Management segregates the loan portfolio into portfolio segments which is defined as the level at which the Bank develops and documents a systematic method for determining its allowance for credit losses. The portfolio segments are segregated based on loan types and the underlying risk factors present in each loan type. Such risk factors are periodically reviewed by management and revised as deemed appropriate.

Portfolio Segments and Risk Factors

The loan portfolio is disaggregated into portfolio segments and then further disaggregated into classes for certain disclosures. GAAP defines a portfolio segment as the level at which an entity develops and documents a systematic method for determining its allowance for credit losses. A class is generally a disaggregation of a portfolio segment. The Company's loan portfolio segments are Real Estate, Commercial, and Consumer and Other. The classes and risk characteristics of each segment are discussed in more detail below. The segmentation and disaggregation of the portfolio is part of the ongoing credit monitoring process.

Real Estate Portfolio Segment

Real Estate: Commercial loans are extensions of credit secured by owner-occupied and non-owner-occupied collateral. Repayment is generally dependent on the successful operations of the property. General economic conditions may impact the performance of these types of loans, including fluctuations in the value of real estate, vacancy rates, and unemployment trends. Real estate commercial loans also include farmland loans that can be, or are, used for agricultural purposes. These loans are usually repaid through refinancing, cash flow from the borrower’s ongoing operations, development of the property, or sale of the property.

Real Estate: Construction loans include loans to small-to-midsized businesses to construct owner-occupied properties, loans to developers of commercial real estate investment properties and residential developments and, to a lesser extent, loans to individual clients for construction of single-family homes in the Company’s market areas. Risks associated with these loans include fluctuations in the value of real estate, project completion risk and changes in market trends. The Company is also exposed to risk based on the ability of the construction loan borrower to finance the loan or sell the property upon completion of the project, which may be affected by changes in secondary market terms and criteria for permanent financing since the time that the Company funded the loan.

Real Estate: Residential loans include first and second lien 1-4 family mortgage loans, as well as home equity lines of credit, in each case primarily on owner-occupied primary residences. The Company is exposed to risk based on fluctuations in the value of the real estate collateral securing the loan, as well as changes in the borrower’s financial condition, which could be affected by numerous factors, including divorce, job loss, illness, or other personal hardship. Real estate residential loans also include multi-family residential loans originated to provide permanent financing for multi-family residential income producing properties. Repayment of these loans primarily relies on successful rental and management of the property.

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Commercial Portfolio Segment

Commercial loans include general commercial and industrial, or C&I, loans, including commercial lines of credit, working capital loans, term loans, equipment financing, asset acquisition, expansion, and development loans, borrowing base loans, letters of credit and other loan products, primarily in the Company’s target markets that are underwritten based on the borrower’s ability to service the debt from income. Commercial loan risk is derived from the expectation that such loans generally are serviced principally from the operations of the business, and those operations may not be successful. Any interruption or discontinuance of operating cash flows from the business, which may be influenced by events not under the control of the borrower such as economic events and changes in governmental regulations, could materially affect the ability of the borrower to repay the loan.

Consumer and Other Portfolio Segment

Consumer and other loans include a variety of loans to individuals for personal, family and household purposes, including secured and unsecured installment and term loans. The risk is based on changes in the borrower’s financial condition, which could be affected by numerous factors, including divorce, job loss, illness or other personal hardship, and fluctuations in the value of the real estate or personal property securing the consumer loan, if any.

The following tables set forth, for the three and nine months ended September 30, 2026, and 2025, the balance of the allowance for credit losses by loan portfolio segment. The allowance for credit losses allocated to each portfolio segment is not necessarily indicative of future losses in any particular portfolio segment and does not restrict the use of the allowance to absorb losses in other portfolio segments.

Allowance for Credit Losses and Recorded Investment in Loans Receivable


	For the Nine Months Ended September 30, 2026
(Dollars in thousands)	Real Estate: Commercial		Real Estate: Construction		Real Estate: Residential		Commercial		Consumer and Other		Total
Allowance for Loan Losses:
Beginning Balance	$	23,486	$	3,237	$	7,423	$	19,282	$	531	$	53,959
Adjustment for Progressive Loans	2,431		281		3,344		3,148		60		9,264
Charge-offs	(1,877)		(147)		(162)		(6,763)		(1,150)		(10,099)
Recoveries	112		4		69		400		173		758
Provision (Recovery)	(554)		1,574		(4,286)		8,161		818		5,713
Ending Balance	$	23,598	$	4,949	$	6,388	$	24,228	$	432	$	59,595

Reserve for Unfunded Loan Commitments:
Beginning Balance	$	320	$	1,179	$	309	$	2,336	$	33	$	4,177
Provision (Recovery)	(32)		119		(122)		501		28		494
Ending Balance	$	288	$	1,298	$	187	$	2,837	$	61	$	4,671

Total Allowance for Credit Losses	$	23,886	$	6,247	$	6,575	$	27,065	$	493	$	64,266

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	For the Three Months Ended September 30, 2026
(Dollars in thousands)	Real Estate: Commercial		Real Estate: Construction		Real Estate: Residential		Commercial		Consumer and Other		Total
Allowance for Loan Losses:
Beginning Balance	$	21,589	$	3,849	$	9,143	$	27,086	$	791	$	62,458

Charge-offs	(820)		(147)		(135)		(4,304)		(381)		(5,787)
Recoveries	106		—		9		101		68		284
Provision (Recovery)	2,723		1,247		(2,629)		1,345		(46)		2,640
Ending Balance	$	23,598	$	4,949	$	6,388	$	24,228	$	432	$	59,595

Reserve for Unfunded Loan Commitments:
Beginning Balance	$	318	$	1,193	$	210	$	3,594	$	58	$	5,373
Provision (Recovery)	(30)		105		(23)		(757)		3		(702)
Ending Balance	$	288	$	1,298	$	187	$	2,837	$	61	$	4,671

Total Allowance for Credit Losses	$	23,886	$	6,247	$	6,575	$	27,065	$	493	$	64,266


	For the Nine Months Ended September 30, 2025
(Dollars in thousands)	Real Estate: Commercial		Real Estate: Construction		Real Estate: Residential		Commercial		Consumer and Other		Total
Allowance for Loan Losses:
Beginning Balance	$	23,460	$	7,162	$	8,036	$	15,667	$	515	$	54,840

Charge-offs	(1,678)		(20)		(236)		(2,572)		(1,478)		(5,984)
Recoveries	10		200		21		698		189		1,118
Provision (Recovery)	(3,352)		187		505		8,445		1,303		7,088
Ending Balance	$	18,440	$	7,529	$	8,326	$	22,238	$	529	$	57,062

Reserve for Unfunded Loan Commitments:
Beginning Balance	$	228	$	1,311	$	358	$	1,765	$	26	$	3,688
Provision (Recovery)	73		635		(62)		488		(2)		1,132
Ending Balance	$	301	$	1,946	$	296	$	2,253	$	24	$	4,820

Total Allowance for Credit Losses	$	18,741	$	9,475	$	8,622	$	24,491	$	553	$	61,882

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	For the Three Months Ended September 30, 2025
(Dollars in thousands)	Real Estate: Commercial		Real Estate: Construction		Real Estate: Residential		Commercial		Consumer and Other		Total
Allowance for Loan Losses:
Beginning Balance	$	23,317	$	6,198	$	8,176	$	20,289	$	516	$	58,496

Charge-offs	(1,412)		—		1		(1,525)		(479)		(3,415)
Recoveries	—		102		11		132		103		348
Provision (Recovery)	(3,465)		1,229		138		3,342		389		1,633
Ending Balance	$	18,440	$	7,529	$	8,326	$	22,238	$	529	$	57,062

Reserve for Unfunded Loan Commitments:
Beginning Balance	$	266	$	888	$	286	$	1,808	$	22	$	3,270
Provision (Recovery)	35		1,058		10		445		2		1,550
Ending Balance	$	301	$	1,946	$	296	$	2,253	$	24	$	4,820

Total Allowance for Credit Losses	$	18,741	$	9,475	$	8,622	$	24,491	$	553	$	61,882

Included within the above allowance, in the tables above, are loans which management has individually evaluated to determine an allowance for credit losses. The following table summarizes, by segment, the loan balance and specific allowance allocation for those loans which have been individually evaluated.


	September 30, 2026				December 31, 2025
(Dollars in thousands)	Loan Balance		Specific Allocations		Loan Balance		Specific Allocations
Real Estate Loans:
Commercial	$	11,748	$	4,924	$	29,248	$	1,873
Construction	4,450		—		2,141		149
Residential	6,008		—		2,380		—
Total Real Estate Loans	22,206		4,924		33,769		2,022
Commercial	14,982		5,538		10,771		4,989
Consumer and Other	—		—		—		—
Total	$	37,188	$	10,462	$	44,540	$	7,011

Credit Quality Indicators

We utilize a risk grading matrix to assign a risk grade to each of our commercial loans. Loans are graded on a scale of 10 to 80. Individual loan officers review updated financial information, which may include credit scores, financial statements, collateral valuations and other borrower information, for all pass grade (10-45) loans to reassess the risk grade, generally on at least an annual basis.

When a loan has a risk grade of 50, it is considered to be on management's “watch list,” and subject to additional and more frequent monitoring by both the loan officer and senior credit and risk personnel. Loans graded 60 or higher have exhibited potential or actual credit weakness that makes their full collection uncertain and are considered classified loans, consisting of substandard (60), doubtful (70) and loss (80) categories. Generally, loans that are classified are assigned special assets personnel for ongoing monitoring and resolution.

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The following tables set forth the credit quality indicators, disaggregated by loan segment, as of September 30, 2026, and December 31, 2025:


	September 30, 2026
			Criticized
(Dollars in thousands)	Pass (Risk Grade 10-45)		Special Mention (Risk Grade 50)		Substandard (Risk Grade 60)		Doubtful (Risk Grade 70)		Loss (Risk Grade 80)		Total		Current Period Charge- offs
Real Estate: Commercial
Originated in 2026	$	330,857	$	2,633	$	115	$	—	$	—	$	333,605	$	—
Originated in 2025	409,972		3,811		3,724		—		—		417,507		—
Originated in 2024	302,698		159		16,288		—		—		319,145		—
Originated in 2023	201,046		18		24,028		—		—		225,092		—
Originated in 2022	654,431		5,489		8,413		—		—		668,333		786
Originated Prior to 2022	820,903		15,932		16,172		101		—		853,108		1,091
Revolving	77,457		—		—		—		—		77,457		—
Revolving Loans Converted to Term	2,460		—		—		—		—		2,460		—
Total Real Estate: Commercial	$	2,799,824	$	28,042	$	68,740	$	101	$	—	$	2,896,707	$	1,877

Real Estate: Construction
Originated in 2026	$	128,543	$	199	$	—	$	—	$	—	$	128,742	$	—
Originated in 2025	255,580		—		15		—		—		255,595		—
Originated in 2024	107,484		159		5,028		—		—		112,671		—
Originated in 2023	55,991		—		7,076		—		—		63,067		16
Originated in 2022	71,050		2,644		67		—		—		73,761		—
Originated Prior to 2022	54,690		661		3,822		—		—		59,173		131
Revolving	77,924		—		—		—		—		77,924		—
Revolving Loans Converted to Term	3,237		—		—		—		—		3,237		—
Total Real Estate: Construction	$	754,499	$	3,663	$	16,008	$	—	$	—	$	774,170	$	147

Real Estate: Residential
Originated in 2026	$	103,653	$	715	$	140	$	—	$	—	$	104,508	$	—
Originated in 2025	102,457		1,093		3,452		—		—		107,002		—
Originated in 2024	121,294		100		809		—		—		122,203		—
Originated in 2023	81,631		234		4,718		—		—		86,583		53
Originated in 2022	218,329		265		1,553		—		—		220,147		—
Originated Prior to 2022	232,844		1,589		21,439		—		—		255,872		109
Revolving	140,894		1,602		2,048		—		—		144,544		—
Revolving Loans Converted to Term	6,739		—		802		—		—		7,541		—
Total Real Estate: Residential	$	1,007,841	$	5,598	$	34,961	$	—	$	—	$	1,048,400	$	162

Commercial
Originated in 2026	$	300,526	$	1,254	$	67	$	—	$	—	$	301,847	$	40
Originated in 2025	245,448		595		3,388		—		—		249,431		32
Originated in 2024	203,826		852		7,070		—		—		211,748		178
Originated in 2023	142,623		6,326		5,045		51		—		154,045		1,033
Originated in 2022	103,888		1,363		18,457		263		—		123,971		5,362
Originated Prior to 2022	108,627		1,702		10,395		9		—		120,733		118
Revolving	719,995		12,954		17,786		183		—		750,918		—
Revolving Loans Converted to Term	74,264		1,853		2,188		—		—		78,305		—
Total Commercial	$	1,899,197	$	26,899	$	64,396	$	506	$	—	$	1,990,998	$	6,763

Consumer and Other
Originated in 2026	$	13,820	$	—	$	13	$	—	$	—	$	13,833	$	445
Originated in 2025	8,271		—		17		—		—		8,288		42
Originated in 2024	4,370		—		4		—		—		4,374		13
Originated in 2023	2,257		—		14		—		—		2,271		20
Originated in 2022	2,217		—		25		—		—		2,242		4
Originated Prior to 2022	20,697		—		92		1		—		20,790		260
Revolving	17,855		—		1		—		—		17,856		366
Revolving Loans Converted to Term	818		—		140		—		—		958		—
Total Consumer and Other	$	70,305	$	—	$	306	$	1	$	—	$	70,612	$	1,150

Total Loans	$	6,531,666	$	64,202	$	184,411	$	608	$	—	$	6,780,887	$	10,099

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BUSINESS FIRST BANCSHARES, INC. AND SUBSIDIARIES

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS


	December 31, 2025
			Criticized
(Dollars in thousands)	Pass (Risk Grade 10-45)		Special Mention (Risk Grade 50)		Substandard (Risk Grade 60)		Doubtful (Risk Grade 70)		Loss (Risk Grade 80)		Total		Current Period Charge- offs
Real Estate: Commercial
Originated in 2025	$	387,209	$	1,506	$	8,789	$	—	$	—	$	397,504	$	—
Originated in 2024	279,558		12,505		14,421		—		—		306,484		—
Originated in 2023	206,195		22,360		3,622		—		—		232,177		—
Originated in 2022	642,357		21,182		29,621		—		—		693,160		3,850
Originated in 2021	366,356		7,871		1,048		—		—		375,275		2
Originated Prior to 2021	536,644		8,692		6,641		472		—		552,449		—
Revolving	51,905		—		—		—		—		51,905		264
Revolving Loans Converted to Term	2,325		—		—		—		—		2,325		—
Total Real Estate: Commercial	$	2,472,549	$	74,116	$	64,142	$	472	$	—	$	2,611,279	$	4,116

Real Estate: Construction
Originated in 2025	$	206,047	$	848	$	—	$	—	$	—	$	206,895	$	—
Originated in 2024	155,588		—		474		—		—		156,062		—
Originated in 2023	42,018		3,561		1,205		—		—		46,784		—
Originated in 2022	104,768		2,074		2,088		—		—		108,930		1
Originated in 2021	26,011		3,056		472		—		—		29,539		19
Originated Prior to 2021	31,263		1,690		1,928		—		—		34,881		—
Revolving	54,618		—		—		—		—		54,618		—
Revolving Loans Converted to Term	1,360		—		—		—		—		1,360		—
Total Real Estate: Construction	$	621,673	$	11,229	$	6,167	$	—	$	—	$	639,069	$	20

Real Estate: Residential
Originated in 2025	$	95,656	$	1,377	$	—	$	—	$	—	$	97,033	$	(79)
Originated in 2024	84,881		—		507		—		—		85,388		—
Originated in 2023	84,761		—		1,346		—		—		86,107		—
Originated in 2022	242,424		614		1,830		—		—		244,868		8
Originated in 2021	136,520		14,266		454		32		—		151,272		—
Originated Prior to 2021	148,862		6,755		6,611		—		—		162,228		197
Revolving	110,519		1,758		2,120		—		—		114,397		116
Revolving Loans Converted to Term	2,685		—		87		—		—		2,772		—
Total Real Estate: Residential	$	906,308	$	24,770	$	12,955	$	32	$	—	$	944,065	$	242

Commercial
Originated in 2025	$	350,624	$	606	$	326	$	—	$	—	$	351,556	$	3
Originated in 2024	246,163		7,686		1,782		—		—		255,631		239
Originated in 2023	166,677		2,265		3,363		48		—		172,353		1,051
Originated in 2022	137,273		16,048		9,030		—		—		162,351		4,279
Originated in 2021	69,146		1,467		5,367		13		—		75,993		464
Originated Prior to 2021	98,366		884		3,290		38		—		102,578		732
Revolving	748,302		10,058		1,576		24		—		759,960		—
Revolving Loans Converted to Term	18,360		135		22,916		—		—		41,411		—
Total Commercial	$	1,834,911	$	39,149	$	47,650	$	123	$	—	$	1,921,833	$	6,768

Consumer and Other
Originated in 2025	$	12,063	$	—	$	8	$	—	$	—	$	12,071	$	1,119
Originated in 2024	6,896		—		6		—		—		6,902		49
Originated in 2023	3,812		—		19		—		—		3,831		169
Originated in 2022	2,771		—		33		—		—		2,804		97
Originated in 2021	1,045		—		68		2		—		1,115		48
Originated Prior to 2021	29,095		—		125		—		—		29,220		12
Revolving	16,120		—		19		—		—		16,139		497
Revolving Loans Converted to Term	904		—		258		—		—		1,162		—
Total Consumer and Other	$	72,706	$	—	$	536	$	2	$	—	$	73,244	$	1,991

Total Loans	$	5,908,147	$	149,264	$	131,450	$	629	$	—	$	6,189,490	$	13,137

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BUSINESS FIRST BANCSHARES, INC. AND SUBSIDIARIES

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

The above classifications follow regulatory guidelines and can generally be described as follows:

•Pass loans are of satisfactory quality.

•Special mention loans have an existing weakness that could cause future impairment, including the deterioration of financial ratios, past due status, questionable management capabilities and possible reduction in the collateral values.

•Substandard loans have an existing specific and well-defined weakness that may include poor liquidity and deterioration of financial ratios. The loan may be past due and related deposit accounts experiencing overdrafts. Immediate corrective action is necessary.

•Doubtful loans have specific weaknesses that are severe enough to make collection or liquidation in full highly questionable and improbable.

As of September 30, 2026, and December 31, 2025, loan balances outstanding more than 90 days past due and still accruing interest amounted to $3.7 million and $2.2 million, respectively. As of September 30, 2026, and December 31, 2025, loan balances outstanding on nonaccrual status amounted to $80.4 million and $74.5 million, respectively. The Bank considers all loans more than 90 days past due as nonperforming loans.

The following tables provide an analysis of the aging of loans and leases as of September 30, 2026, and December 31, 2025. All loans greater than 90 days past due are generally placed on nonaccrual status.

Aged Analysis of Past Due Loans Receivable


	September 30, 2026
(Dollars in thousands)	30-59 Days Past Due		60-89 Days Past Due		Greater Than 90 Days Past Due		Total Past Due		Current		Total Loans Receivable		Recorded Investment Over 90 Days Past Due and Still Accruing
Real Estate Loans:
Commercial	$	7,005	$	4,127	$	21,275	$	32,407	$	2,864,300	$	2,896,707	$	3,208
Construction	519		6,633		8,675		15,827		758,343		774,170		110
Residential	2,587		795		13,657		17,039		1,031,361		1,048,400		53
Total Real Estate Loans	10,111		11,555		43,607		65,273		4,654,004		4,719,277		3,371
Commercial	9,329		1,023		33,972		44,324		1,946,674		1,990,998		330
Consumer and Other	255		10		235		500		70,112		70,612		-
Total	$	19,695	$	12,588	$	77,814	$	110,097	$	6,670,790	$	6,780,887	$	3,701

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NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS


	December 31, 2025
(Dollars in thousands)	30-59 Days Past Due		60-89 Days Past Due		Greater Than 90 Days Past Due		Total Past Due		Current		Total Loans Receivable		Recorded Investment Over 90 Days Past Due and Still Accruing
Real Estate Loans:
Commercial	$	1,838	$	38,693	$	10,097	$	50,628	$	2,560,651	$	2,611,279	$	363
Construction	1,988		72		4,363		6,423		632,646		639,069		—
Residential	3,775		1,562		8,151		13,488		930,577		944,065		79
Total Real Estate Loans	7,601		40,327		22,611		70,539		4,123,874		4,194,413		442
Commercial	15,585		552		24,692		40,829		1,881,004		1,921,833		1,760
Consumer and Other	185		356		163		704		72,540		73,244		13
Total	$	23,371	$	41,235	$	47,466	$	112,072	$	6,077,418	$	6,189,490	$	2,215

The following table presents non-accrual loans by segment as of September 30, 2026, and December 31, 2025.


(Dollars in thousands)	September 30, 2026		December 31, 2025
Real Estate Loans:
Commercial	$	18,245	$	36,252
Construction	8,608		4,539
Residential	14,364		10,144
Total Real Estate Loans	41,217		50,935
Commercial	38,909		23,370
Consumer and Other	237		166
Total	$	80,363	$	74,471

The Bank had $13.9 million and $9.8 million as of September 30, 2026 and December 31, 2025, respectively, in non-accrual loans with no specific allowance allocation.

The Bank seeks to assist customers who are experiencing financial difficulty by renegotiating loans within lending regulations and guidelines. The Bank makes loan modifications, primarily utilizing internal renegotiation programs via direct customer contact, that manage customers’ debt exposures held only by the Bank. Additionally, the Bank makes loan modifications with customers who have elected to work with external renegotiation agencies and these modifications provide solutions to customers’ entire unsecured debt structures. During the periods ended September 30, 2026, and December 31, 2025, the concessions granted to certain borrowers included extending the payment due dates and offering below market contractual interest rates, and were not significant to the consolidated financial statements.

Accrued interest receivable of $1.2 million and $1.7 million was outstanding at September 30, 2026, and December 31, 2025, respectively, for all loan deferrals, primarily attributable to the COVID-19 pandemic and, to a much lesser extent, hurricanes which occurred in 2020 and 2021. These loans are no longer within their deferral periods. The accrued interest on the loans is due at their maturity.

At September 30, 2026 and December 31, 2025, accrued interest receivable on loans was $34.7 million and $33.2 million, respectively, and included within accrued interest receivable on the consolidated balance sheets.

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NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

In June 2026, the Company sold $95.3 million in loans that were acquired from Progressive, including $54.7 million of residential mortgages and $40.6 million of commercial real estate loans. As part of the sale, the Company will retain the servicing of these loans.

Note 6– Borrowings –

The Company had outstanding advances from the Federal Home Loan Bank (“FHLB”) of $334.2 million and $431.2 million as of September 30, 2026, and December 31, 2025, respectively, consisting of:


(Dollars in thousands)	September 30, 2026		December 31, 2025

4.65% advance due January 2026	$	—	$	25,000
3.62% advance due January 2026 (a)	—		120,000
4.00% advance due March 2026	—		25,000
4.56% advance due July 2026	—		25,000
3.91% advance due July 2026	—		25,000
4.05% advance due October 2026	32,500		—
4.11% advance due October 2026	32,500		—
4.12% advance due October 2026	32,500		—
4.14% advance due October 2026	32,500		—
0.89% advance due November 2026 (b)	2,043		11,200
4.84% advance due December 2026	25,000		25,000
0.71% advance due August 2027 (b) (c)	267		—
0.70% advance due August 2027 (b) (c)	134		—
0.68% advance due August 2027 (b) (c)	134		—
4.78% advance due September 2027	25,000		25,000
4.73% advance due March 2028	25,000		25,000
4.69% advance due September 2028	25,000		25,000
4.13% advance due October 2028 (d)	25,000		25,000
0.94% advance due August 2030 (b) (c)	806		—
0.92% advance due August 2030 (b) (c)	403		—
0.90% advance due August 2030 (b) (c)	402		—
3.92% advance due October 2030 (d)	25,000		25,000
3.72% advance due October 2033 (d)	25,000		25,000
3.57% advance due October 2033 (d)	25,000		25,000
Total FHLB advances	$	334,189	$	431,200

(a)Short term overnight advance.

(b)Principal paid monthly.

(c)Acquired during the Progressive acquisition.

(d)Loan has put options beginning in October 2024.

The Company had an additional $1.6 billion remaining on the FHLB line availability at September 30, 2026.

On January 1, 2026, in connection with the Progressive acquisition, the Company assumed Progressive Bancorp, Inc.'s junior subordinated debentures issued to Progressive Statutory Trust I and Progressive Statutory Trust II, each of which is a non-consolidated statutory trust. The assumed obligations totaled approximately $5.2 million in aggregate junior subordinated debentures, consisting of $1.2 million related to Progressive Statutory Trust I and $4.0 million related to Progressive Statutory Trust II, and were associated with an aggregated $5.0 million of trust preferred securities outstanding. The junior subordinated debentures related to Progressive Statutory Trust I mature on July 31, 2031, and bear interest at a floating rate equal to a benchmark rate plus 3.58%, payable quarterly (including the tenor spread adjustment). The junior subordinated debentures related to Progressive Statutory Trust II mature on December

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15, 2037, and bear interest at a floating rate equal to a benchmark rate plus 1.45%, payable quarterly (including the tenor spread adjustment). The applicable indentures permit the Company to defer interest payments for up to 20 consecutive quarterly periods without an event of default. The Company has guaranteed, on a subordinated basis, distributions and other payments due on the related trust preferred securities, subject to the applicable guarantee agreements and indentures. Principal and interest payments on the junior subordinated debentures are in a superior position to the liquidation rights of holders of common stock.

As part of the acquisition of these debentures, the Company had a fair value adjustment of $555,000, with $521,000 remaining at September 30, 2026.

On April 2, 2026, the Company completed an $85.0 million private placement of subordinated notes with a 6.50% fixed-to-floating rate due in 2036. The subordinated notes were issued to certain qualified institutional and accredited investors. The notes bear interest at an annual rate of 6.50% until March 30, 2031, and then will reset quarterly to a benchmark rate plus 300 basis points. The proceeds from the sale of these subordinated notes were utilized to redeem $66.9 million in outstanding subordinated notes, to provide additional capital support to b1BANK, to support growth, to better position the Company to take advantage of strategic opportunities that may arise from time to time, to repay other existing borrowings, and for other general corporate purposes. As part of the redemption, the Company recognized a $545,000 gain.

On June 29, 2026, the Company consummated the acquisition of APC. Under the terms of the acquisition, the Company issued $4.3 million of subordinated notes with a 6.50% fixed-to-floating rate due in 2036. The notes bear interest at an annual rate of 6.50% until June 30, 2031, and then will reset quarterly to a benchmark plus 300 basis points.

Note 7– Other Income and Other Expense –

The Company has a single reportable operating segment which is presented as the Consolidated Statements of Income. An analysis of other income for the Company's single reportable operating segment is as follows:


	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
(Dollars in thousands)	2026		2025		2026		2025
Debit Card and ATM Fee Income	$	2,380	$	1,915	$	7,101	$	5,731
Cash Value of Life Insurance Income	979		802		2,712		2,368
Fees and Brokerage Commissions	2,458		1,880		7,106		6,008
Pass-Through (Loss) Income from SBIC and Fintech Partnerships	(135)		133		14		638
Gain on Extinguishment/Redemption of Debt	—		—		545		630
Gain on Sale of Banking Center	—		—		—		3,360
Swap Fee Income	626		1,065		2,548		2,612
Other	2,071		2,610		7,033		7,217
Total Other Income	$	8,379	$	8,405	$	27,059	$	28,564

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NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

An analysis of other expenses for the Company's single reportable operating segment is as follows:


	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
(Dollars in thousands)	2026		2025		2026		2025
Advertising and Promotions	$	2,064	$	1,205	$	6,178	$	3,584
Communications	773		582		2,063		1,763
Ad Valorem Shares Tax	978		1,125		2,933		3,375
Data Processing Fees	3,084		3,972		10,113		12,529
Directors' Fees	308		261		815		733
Insurance	188		420		1,031		1,248
Legal and Professional Fees	1,236		1,024		3,982		3,130
Office Supplies and Printing	268		286		859		897
Regulatory Assessments	1,209		1,142		3,727		3,332

Other	6,302		3,491		17,465		11,909
Total Other Expenses	$	16,410	$	13,508	$	49,166	$	42,500

Note 8– Leases –

The Bank leases certain banking center offices through non-cancelable operating leases with terms that range from one to ten years and contain various renewal options for certain of the leases. Certain leases provide for increases in minimum monthly rental payments as defined by the lease agreement. Rental expense under these agreements was $7.1 million and $6.4 million for the nine months ended September 30, 2026 and 2025, respectively. At September 30, 2026, the Company had a weighted average lease term of 5.2 years and a weighted average discount rate of 3.98%.

Future minimum lease payments under these leases are as follows:


(Dollars in thousands)
October 1, 2026 through December 31, 2026	$	2,853
January 1, 2027 through December 31, 2027	5,837
January 1, 2028 through December 31, 2028	5,349
January 1, 2029 through December 31, 2029	4,425
January 1, 2030 through December 31, 2030	2,958
January 1, 2031 and Thereafter	5,935
Total Future Minimum Lease Payments	27,357
Less Imputed Interest	(2,628)
Present Value of Lease Liabilities	$	24,729

Note 9– Commitments and Contingencies –

In the normal course of business, the Bank is a party to financial instruments with off-balance sheet risk to meet the financing needs of its customers. These financial instruments include commitments to extend credit and standby and commercial letters of credit which are not included in the accompanying financial statements. These instruments involve, to varying degrees, elements of credit risk in excess of the amount recognized in the balance sheet.

The Bank’s exposure to credit loss in the event of nonperformance by the other party to the financial instrument for commitments to extend credit and standby and commercial letters of credit is represented by the contractual amount of those instruments. The Bank’s policy for obtaining collateral, and the nature of such collateral, is essentially the same as that involved in making commitments to extend credit. The Bank uses the same credit policies in making such commitments and conditional obligations as it does for instruments that are included in the balance sheet. In the

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NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

normal course of business, the Bank has made commitments to extend credit of approximately $2.1 billion and $1.7 billion at September 30, 2026 and December 31, 2025, respectively, and standby and commercial letters of credit of approximately $54.5 million and $51.2 million at September 30, 2026 and December 31, 2025, respectively. As discussed in Note 5, we have a reserve for unfunded loan commitments of $4.7 million and $4.2 million at September 30, 2026 and December 31, 2025, respectively.

In the normal course of business, the Bank is involved in various legal proceedings. In the opinion of management and counsel, the disposition or ultimate resolution of such proceedings would not have a material adverse effect on the Bank’s financial statements.

Note 10– Customer-Initiated Derivatives

The Company enters into derivative instruments to meet the needs of its customers through the execution of customer-initiated derivatives (swaps and caps and floors). These financial instruments involve elements of market and credit risk. Market and credit risk are included in the determination of fair value. Market risk is the potential loss that may result from movements in interest rates that cause an unfavorable change in the value of a financial instrument. Market risk in interest rate contracts executed on behalf of customers is mitigated by taking offsetting positions. Credit risk is the possible loss that may occur in the event of default by the counterparty to a financial instrument. The Company manages credit risk arising from customer-initiated derivatives by evaluating the creditworthiness of each customer, utilizing a similar approval process used for its lending activities. Derivatives with dealer counterparties are either cleared through a clearinghouse or settled directly with a single counterparty. The Company has quantified the credit risk as not significant as of September 30, 2026.

Income primarily results from the spread between the customer derivative and the offsetting dealer position. For the three months ended September 30, 2026, the Company recognized $626,000 in swap fee income, and $2.5 million for the nine months ended September 30, 2026.


	September 30, 2026
(Dollars in thousands)	Notional / Contract Amount		Gross Derivative Assets		Gross Derivative Liabilities
Customer-initiated and other activities:
Interest rate contracts:
Caps and floors written	$	95,162	$	—	$	930
Caps and floors purchased	95,162		930		—
Swaps	999,476		11,863		11,863
Total interest rate contracts	$	1,189,800	$	12,793	$	12,793

Note 11– Fair Value of Financial Instruments –

Fair Value Disclosures

The Company groups its financial assets and liabilities measured at fair value in three levels. Fair value should be based on the assumptions market participants would use when pricing the asset or liability and establishes a fair value hierarchy that prioritizes the inputs used to develop those assumptions and measure fair value. The hierarchy requires companies to maximize the use of observable inputs and minimize the use of unobservable inputs. The three levels of inputs used to measure fair value are as follows:

•Level 1 – Includes the most reliable sources and includes quoted prices in active markets for identical assets or liabilities.

•Level 2 – Includes observable inputs. Observable inputs include inputs other than quoted prices that are observable for the asset or liability (for example, interest rates and yield curves at commonly quoted intervals, volatilities, prepayment speeds, loss severities, credit risks, and default rates) as well as inputs that are derived

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principally from or corroborated by observable market data by correlation or other means (market-corroborated inputs).

•Level 3 – Includes unobservable inputs and should be used only when observable inputs are unavailable.

Recurring Basis

Fair values of investment securities available for sale were primarily measured using information from a third-party pricing service. This pricing service provides information by utilizing evaluated pricing models supported with market data information. Standard inputs include benchmark yields, reported trades, broker/dealer quotes, issuer spreads, benchmark securities, bids, offers, and reference data from market research publications.

The fair values of mortgage loans held for sale are based on commitments on hand from investors within the secondary market for loans with similar characteristics.

The following tables present the balance of assets and liabilities measured on a recurring basis as of September 30, 2026, and December 31, 2025.


(Dollars in thousands)	Fair Value		Level 1		Level 2		Level 3
September 30, 2026
Available for Sale:
U.S. Treasury Securities	$	19,447	$	—	$	19,447	$	—
U.S. Government Agency Securities	249		—		249		—
Corporate Securities	85,188		—		77,971		7,217
Mortgage-Backed Securities	651,655		—		651,655		—
Municipal Securities	230,165		—		210,879		19,286
Loans Held for Sale	254		—		254		—
Interest Rate Swaps	12,793		—		12,793		—
Total assets at fair value	$	999,751	$	—	$	973,248	$	26,503
Interest Rate Swaps	$	12,793	$	—	$	12,793	$	—
Total liabilities at fair value	$	12,793	$	—	$	12,793	$	—

December 31, 2025
Available for Sale:
U.S. Treasury Securities	$	17,278	$	—	$	17,278	$	—
U.S. Government Agency Securities	9,874		—		9,874		—
Corporate Securities	37,062		—		28,541		8,521
Mortgage-Backed Securities	650,091		—		650,091		—
Municipal Securities	274,924		—		251,477		23,447
Loans Held for Sale	1,094		—		1,094		—
Interest Rate Swaps	8,023		—		8,023		—
Total assets at fair value	$	998,346	$	—	$	966,378	$	31,968
Interest Rate Swaps	$	8,023	$	—	$	8,023	$	—
Total liabilities at fair value	$	8,023	$	—	$	8,023	$	—

The Company reviews fair value hierarchy classifications on a quarterly basis. Changes in the Company's ability to observe inputs to the valuation may cause reclassification of certain assets or liabilities within the fair value hierarchy.

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BUSINESS FIRST BANCSHARES, INC. AND SUBSIDIARIES

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

The table below provides a reconciliation for assets measured at fair value on a recurring basis using significant unobservable inputs, or Level 3 inputs, as of September 30, 2026, and December 31, 2025.


(Dollars in thousands)	Municipal Securities		Corporate Securities
Balance at December 31, 2024	$	24,717	$	12,500

Unrealized Gains Included in Other Comprehensive Loss	2,458		21


Maturities, Prepayments, and Calls	(3,728)		—

Transfers Out of Level 3	—		(4,000)
Balance at December 31, 2025	23,447		8,521

Unrealized (Loss) Gains Included in Other Comprehensive Loss	(639)		196


Maturities, Prepayments, and Calls	(3,522)		—

Transfers Out of Level 3	—		(1,500)
Balance at September 30, 2026	$	19,286	$	7,217

The following table provides quantitative information about significant unobservable inputs used in fair value measurements of Level 3 assets measured at fair value on a recurring basis at September 30, 2026.

(Dollars in thousands)

Estimated Fair Value

Valuation Technique

Unobservable Inputs

Discounts

September 30, 2026

Municipal Securities

19,286

Present Value of Expected Future Cash Flow Model

Liquidity Premium

Corporate Securities

7,217

Present Value of Expected Future Cash Flow Model

Liquidity Premium

Nonrecurring Basis

The Company has segregated all financial assets and liabilities that are measured at fair value on a nonrecurring basis into the most appropriate level within the fair value hierarchy based on the inputs used to determine the fair value at the measurement date in the table below. The Company did not record any liabilities at fair value for which measurement of the fair value was made on a nonrecurring basis.

The fair value of the individually evaluated loans is measured at the fair value of the collateral for collateral-dependent loans. Individually evaluated loans are Level 3 assets measured using appraisals from external parties of the collateral less any prior liens and adjusted for estimated selling costs. Adjustments may be made by management based on a customized internally developed discounting matrix. Repossessed assets are initially recorded at fair value less

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BUSINESS FIRST BANCSHARES, INC. AND SUBSIDIARIES

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

estimated cost to sell, which is generally 10%. The fair value of repossessed assets is based on property appraisals and an analysis of similar properties available. As such, the Bank records repossessed assets as Level 3.


(Dollars in thousands)	Fair Value		Level 1		Level 2		Level 3
September 30, 2026
Assets:
Individually Evaluated Loans	$	28,471	$	—	$	—	$	28,471
Other Nonperforming Assets	24,761		—		—		24,761
Total	$	53,232	$	—	$	—	$	53,232

December 31, 2025
Assets:
Individually Evaluated Loans	$	14,083	$	—	$	—	$	14,083
Other Nonperforming Assets	13,013		—		—		13,013
Total	$	27,096	$	—	$	—	$	27,096

Fair Value of Financial Instruments

The fair value of a financial instrument is the current amount that would be exchanged between willing parties, other than in a forced liquidation. Fair value is best determined based upon quoted market prices. However, in many instances, there are no quoted market prices for the Company’s various financial instruments. In cases where quoted market prices are not available, fair values are based on estimates using present value or other valuation techniques. Those techniques are significantly affected by the assumptions used, including the discount rate and estimates of future cash flows. Accordingly, the fair value estimates may not be realized in an immediate settlement of the instrument. In accordance with GAAP, certain financial instruments and all non-financial instruments are excluded from these disclosure requirements. Accordingly, the aggregate fair value amounts presented may not necessarily represent the underlying fair value of the Company.

The following methods and assumptions were used to estimate the fair value of each class of financial instruments for which it is practicable to estimate that value:

Cash and Short-Term Investments – For those short-term instruments, the carrying amount is a reasonable estimate of fair value.

Securities Purchased Under Agreements to Resell - The carrying amount approximates its fair value.

Securities – Fair value of securities is based on quoted market prices. If a quoted market price is not available, fair value is estimated using quoted market prices for similar securities.

Loans – The fair value for loans is estimated using discounted cash flow analyses, with interest rates currently being offered for similar loans to borrowers with similar credit rates. Loans with similar classifications are aggregated for purposes of the calculations. The allowance for loan losses, which was used to measure the credit risk, is subtracted from loans.

Cash Value of Bank-Owned Life Insurance (“BOLI”) – The carrying amount approximates its fair value.

Other Equity Securities – The carrying amount approximates its fair value.

Interest Rate Swaps - Market values are obtained from market pricing data sources available for comparable transactions in the over-the-counter derivative market.

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BUSINESS FIRST BANCSHARES, INC. AND SUBSIDIARIES

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

Deposits – The fair value of demand deposits and certain money market deposits is the amount payable at the reporting date. The fair value of fixed-maturity certificates of deposit is estimated using discounted cash flow analyses, with interest rates currently offered for deposits of similar remaining maturities.

Borrowings – The fair value of FHLB advances and other long-term borrowings is estimated using the rates currently offered for advances of similar maturities. The carrying amount of short-term borrowings maturing within ninety days approximates the fair value.

Commitments to Extend Credit and Standby and Commercial Letters of Credit – The fair values of commitments to extend credit and standby and commercial letters of credit do not differ significantly from the commitment amount and are therefore omitted from this disclosure.

The estimated approximate fair values of the Bank’s financial instruments as of September 30, 2026, and December 31, 2025 are as follows:


(Dollars in thousands)	Carrying Amount		Total Fair Value		Level 1		Level 2		Level 3
September 30, 2026
Financial Assets:
Cash and Short-Term Investments	$	600,775	$	600,775	$	600,775	$	—	$	—
Securities Purchased Under Agreements to Resell	79,214		79,214		—		79,214		—
Securities	986,704		986,704		—		960,201		26,503
Loans Held for Sale	254		254		—		254		—
Loans - Net	6,721,292		6,651,492		—		—		6,651,492
Cash Value of BOLI	140,148		140,148		—		140,148		—
Other Equity Securities	39,984		39,984		—		—		39,984
Interest Rate Swaps	12,793		12,793		—		12,793		—
Total	$	8,581,164	$	8,511,364	$	600,775	$	1,192,610	$	6,717,979

Financial Liabilities:
Deposits	$	7,376,798	$	7,366,222	$	—	$	—	$	7,366,222
Borrowings	483,024		473,273		—		473,273		—
Interest Rate Swaps	12,793		12,793		—		12,793		—
Total	$	7,872,615	$	7,852,288	$	—	$	486,066	$	7,366,222

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BUSINESS FIRST BANCSHARES, INC. AND SUBSIDIARIES

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS


(Dollars in thousands)	Carrying Amount		Total Fair Value		Level 1		Level 2		Level 3
December 31, 2025
Financial Assets:
Cash and Short-Term Investments	$	583,568	$	583,568	$	583,568	$	—	$	—
Securities Purchased Under Agreements to Resell	25,587		25,587		—		25,587		—
Securities	989,229		989,229		—		957,261		31,968
Loans Held for Sale	1,094		1,094		—		1,094		—
Loans - Net	6,135,531		6,116,333		—		—		6,116,333
Cash Value of BOLI	120,292		120,292		—		120,292		—
Other Equity Securities	49,342		49,342		—		—		49,342
Interest Rate Swaps	8,023		8,023		—		8,023		—
Total	$	7,912,666	$	7,893,468	$	583,568	$	1,112,257	$	6,197,643

Financial Liabilities:
Deposits	$	6,698,590	$	6,698,181	$	—	$	—	$	6,698,181
Borrowings	551,352		554,309		—		554,309		—
Interest Rate Swaps	8,023		8,023		—		8,023		—
Total	$	7,257,965	$	7,260,513	$	—	$	562,332	$	6,698,181

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

FORWARD-LOOKING STATEMENTS

When we refer in this Form 10-Q to “we,” “our,” “us,” the “Company” and “Business First,” we are referring to Business First Bancshares, Inc. and its consolidated subsidiaries, including b1BANK, which we sometimes refer to as “the Bank,” unless the context indicates otherwise.

The information contained in this Form 10-Q is accurate only as of the date of this form and the dates specified herein.

All statements other than statements of historical fact contained in this Quarterly Report on Form 10-Q (this “Report”) and other periodic reports filed by the Company, and other written or oral statements made by us or on our behalf, are “forward-looking statements,” as defined by (and subject to the “safe harbor” protections under) the federal securities laws. These forward-looking statements include statements that reflect the current views of our senior management with respect to our financial performance and future events with respect to our business and the banking industry in general. These statements are often, but not always, made through the use of words or phrases such as “may,” “should,” “could,” “predict,” “potential,” “believe,” “will likely result,” “expect,” “will continue,” “anticipate,” “seek,” “estimate,” “intend,” “plan,” “projection,” “would” and “outlook,” and similar expressions of a future or forward-looking nature. These statements involve estimates, assumptions, and risks and uncertainties. Accordingly, there are or will be important factors that could cause our actual results to differ materially from those indicated in these statements.

We believe these factors include, but are not limited to, the following:

•risks related to the integration of any other acquired businesses, including exposure to potential asset quality and credit quality risks and unknown or contingent liabilities, risks related to entering a new geographic market, the time and costs associated with integrating systems, technology platforms, procedures and personnel, the ability to retain key employees and maintain relationships with significant customers, the need for additional capital to finance such transactions, and possible failures in realizing the anticipated benefits from acquisitions;

•changes in the strength of the United States (“U.S.”) economy in general and the local economy in our local market areas adversely affecting our customers and their ability to transact profitable business with us, including the ability of our borrowers to repay their loans according to their terms or a change in the value of the related collateral;

•economic risks posed by our geographic concentration in Louisiana, the Dallas/Fort Worth metroplex and Houston;

•the ability to sustain and continue our organic loan and deposit growth, and manage that growth effectively;

•market declines in industries to which we have exposure, such as the volatility in oil prices and downturns in the energy industry that impact certain of our borrowers and investments that operate within, or are backed by collateral associated with, the energy industry;

•volatility and direction of interest rates and market prices, which could reduce our net interest margins, asset valuations and expense expectations;

•interest rate risk associated with our business;

•changes in the levels of loan prepayments and the resulting effects on the value of our loan portfolio;

•increased competition in the financial services industry, particularly from regional and national institutions and emerging non-bank competitors;

•increased credit risk in our assets and increased operating risk caused by a material change in commercial, consumer and/or real estate loans as a percentage of our total loan portfolio;

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•changes in the value of collateral securing our loans;

•deteriorating asset quality and higher loan charge-offs, and the time and effort required to resolve problem assets;

•the failure of assumptions underlying the establishment of and provisions made to our allowance for credit losses;

•changes in the availability of funds resulting in increased costs or reduced liquidity;

•our ability to maintain important deposit customer relationships and our reputation;

•a determination or downgrade in the credit quality and credit agency ratings of the securities in our securities portfolio;

•increased asset levels and changes in the composition of assets and the resulting impact on our capital levels and regulatory capital ratios;

•our ability to prudently manage our growth and execute our strategy;

•risks associated with our acquisition and de novo branching strategy;

•the loss of senior management or operating personnel and the potential inability to hire qualified personnel at reasonable compensation levels;

•legislative or regulatory developments, including changes in the laws, regulations, interpretations or policies relating to financial institutions, accounting, tax, trade, monetary and fiscal matters;

•government intervention in the U.S. financial system;

•changes in statutes and government regulations or their interpretations applicable to us, including changes in tax requirements and tax rates;

•natural disasters and adverse weather, acts of terrorism, an outbreak of hostilities or other international or domestic calamities, epidemics and pandemics such as coronavirus, and other matters beyond our control; and

•other risks and uncertainties listed from time to time in our reports and documents filed with the U.S. Securities and Exchange Commission (“SEC”).

The foregoing factors should not be construed as exhaustive and should be read together with the other cautionary statements included in this Report. Additional information on these and other risk factors can be found in Item 1A. “Risk Factors” of this Report and in Item 1A. “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025, filed with the SEC.

In the event that one or more events related to these, or other risks or uncertainties materialize, or if our underlying assumptions prove to be incorrect, actual results may differ materially from what we anticipate. Accordingly, you should not place undue reliance on any such forward-looking statements. Any forward-looking statement speaks only as of the date on which it is made and we do not undertake any obligation to update any forward-looking statement or statements to reflect events or circumstances after the date on which such statement is made or to reflect the occurrence of unanticipated events. New factors emerge from time to time, and it is not possible for us to predict which will arise. In addition, we cannot assess the impact of each factor on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements.

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF

FINANCIAL CONDITION AND RESULTS OF OPERATIONS OF BUSINESS FIRST

The following discussion and analysis focuses on significant changes in the financial condition of Business First and its subsidiaries from December 31, 2025 to September 30, 2026, and its results of operations for the three and nine months ended September 30, 2026. This discussion and analysis is intended to highlight and supplement information presented elsewhere in this report and should be read in conjunction with (i) the accompanying unaudited consolidated financial statements and the notes thereto (the “Notes”) and (ii) our Annual Report on Form 10-K for the year ended December 31, 2025, including the audited consolidated financial statements and notes thereto, management’s discussion and analysis, and the risk factor disclosures contained therein. This discussion and analysis contains forward-looking statements that are subject to certain risks and uncertainties and are based on certain assumptions that Business First believes are reasonable but may prove to be inaccurate. Certain risks, uncertainties and other factors, including those set forth under “Forward-Looking Statements,” “Risk Factors” and elsewhere in this report, may cause actual results to differ materially from those projected results discussed in the forward-looking statements appearing in this discussion and analysis. Business First assumes no obligation to update any of these forward-looking statements.

Overview

We are a registered financial holding company headquartered in Baton Rouge, Louisiana. Through our wholly-owned subsidiary, b1BANK, a Louisiana state chartered bank, we provide a broad range of financial services tailored to meet the needs of small-to-midsized businesses and professionals. Since our inception in 2006, our priority has been and continues to be creating shareholder value through the establishment of an attractive commercial banking franchise in Louisiana and across our region. We consider our primary market to include the State of Louisiana, the Dallas/Fort Worth metroplex, and Houston. We currently operate out of banking centers and loan production offices across Louisiana and Texas. As of September 30, 2026, we had total assets of $9.0 billion, total loans of $6.8 billion, total deposits of $7.4 billion, and total shareholders’ equity of $1.0 billion.

As a financial holding company operating through one reportable operating segment, community banking, we generate most of our revenues from interest income on loans, customer service and loan fees, and interest income from securities. We incur interest expense on deposits and other borrowed funds and noninterest expense, such as salaries and employee benefits and occupancy expenses. We analyze our ability to maximize income generated from interest-earning assets and expense of our liabilities through our net interest margin. Net interest margin is a ratio calculated as net interest income divided by average interest-earning assets. Net interest income is the difference between interest income on interest-earning assets, such as loans and securities, and interest expense on interest-bearing liabilities, such as deposits and borrowings, which are used to fund those assets.

Changes in the market interest rates and the interest rates we earn on interest-earning assets or pay on interest-bearing liabilities, as well as the volume and types of interest-earning assets, interest-bearing and noninterest-bearing liabilities and shareholders’ equity, are usually the largest drivers of periodic changes in net interest spread, net interest margin and net interest income. Fluctuations in market interest rates are driven by many factors, including governmental monetary policies, inflation, deflation, macroeconomic developments, changes in unemployment, the money supply, political and international conditions, and conditions in domestic and foreign financial markets. Periodic changes in the volume and types of loans in our loan portfolio are affected by, among other factors, economic and competitive conditions in our markets and across our region, as well as developments affecting the real estate, technology, financial services, insurance, transportation, manufacturing and energy sectors within our markets.

Other Developments

Acquisition of Progressive Bancorp, Inc. ("Progressive")

On January 1, 2026, we consummated the merger of Progressive, the parent bank holding company for Progressive Bank, with and into Business First, with Business First continuing as the surviving corporation pursuant to the terms of the Reorganization Agreement. Immediately following the consummation of the Progressive acquisition, Progressive Bank merged with and into b1BANK, with b1BANK surviving the merger. Pursuant to the terms of the Reorganization Agreement, upon consummation of the Progressive acquisition, we issued 3,192,367 shares of our common stock to the

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former shareholders of Progressive. As of December 31, 2025, Progressive had $773.8 million in total assets, $597.2 million in loans and $684.9 million in total deposits.

Technology Partnership with Covecta

On February 17, 2026, we announced a strategic partnership with Covecta, to deploy agentic AI across the bank's day-to-day workflows. The collaboration focuses on streamlining and automating repeatable, policy-driven activities across core deposit and loan operational processes, reducing manual effort and operational friction so that teams can devote more time towards higher value-adding work including analysis, exception handling and customer engagement.

Private Placement of Subordinated Notes

On April 2, 2026, we completed an $85.0 million private placement of subordinated notes with a 6.50% fixed-to-floating rate due in 2036. The subordinated notes were issued to certain qualified institutional and accredited investors. The notes bear interest at an annual rate of 6.50% until March 30, 2031, and then will reset quarterly to the then current three-month Secured Overnight Financing Rate plus 300 basis points. The proceeds from the sale of these subordinated notes were utilized to redeem $66.9 million in outstanding subordinated notes, to provide additional capital support to b1BANK, to support growth, to better position the Company to take advantage of strategic opportunities that may arise from time to time, to repay other existing borrowings, and for other general corporate purposes.

Acquisition of American Planning Corporation (“APC”)

On June 29, 2026, we consummated the acquisition of APC, a financial consulting firm, for $6.8 million, of which $2.6 million was paid in cash and $4.3 million was paid in the form of subordinated debt. As part of the transaction, we recorded a customer intangible of $4.8 million, to be amortized over a 10-year period and $1.9 million in goodwill. The APC acquisition will expand the advisory platform of b1BANK’s subsidiary, Smith Shellnut Wilson, LLC (“SSW”).

Financial Highlights

The financial highlights as of and for the nine months ended September 30, 2026, include:

•Total assets of $9.0 billion, a $741.2 million, or 9.0%, increase from December 31, 2025.

•Total loans held for investment of $6.8 billion, a $591.4 million, or 9.6%, increase from December 31, 2025.

•Total deposits of $7.4 billion, a $678.2 million, or 10.1%, increase from December 31, 2025.

•Net income available to common shareholders of $68.2 million for the nine months ended September 30, 2026, a $6.8 million, or 11.0%, increase from the nine months ended September 30, 2025. The increase was largely attributable to the acquisition of Progressive during the quarter ended March 31, 2026.

•Net interest income of $233.7 million for the nine months ended September 30, 2026, an increase of $31.4 million, or 15.5%, from the nine months ended September 30, 2025. The increase was largely attributable to the acquisition of Progressive during the quarter ended March 31, 2026.

•Allowance for credit losses of 0.95% of total loans held for investment, compared to 0.94% as of December 31, 2025, and a ratio of nonperforming loans to total loans held for investment of 1.24%, for both September 30, 2026 and December 31, 2025.

•Earnings per common share for the first nine months of 2026 of $2.10 per basic common share and $2.08 per diluted common share, compared to $2.09 per basic common share and $2.08 per diluted common share for the first nine months of 2025.

•Return on average assets of 1.03% over the first nine months of 2026, compared to 1.05% for the first nine months of 2025.

•Return on average common equity of 9.78% over the first nine months of 2026, compared to 10.74% for the first nine months of 2025.

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•Capital ratios for Tier 1 Leverage, Common Equity Tier 1, Tier 1 Risk-based and Total Risk-based Capital of 10.36%, 10.29%, 11.31% and 13.55%, respectively, compared to 10.08%, 9.94%, 11.00% and 12.93% at December 31, 2025.

•Book value per common share of $28.77, an increase of 2.9% from $27.95 at December 31, 2025.

Results of Operations for the Three and Nine Months Ended September 30, 2026, and 2025

Performance Summary

For the three months ended September 30, 2026, net income available to common shareholders was $23.2 million, or $0.71 per basic and diluted common share, compared to net income available to common shareholders of $21.5 million, or $0.73 per basic and diluted common share, for the three months ended September 30, 2025. Return on average assets, on an annualized basis, decreased to 1.04% for the three months ended September 30, 2026, from 1.08% for the three months ended September 30, 2025. Return on average common equity, on an annualized basis, decreased to 9.75% for the three months ended September 30, 2026, as compared to 10.80% for the three months ended September 30, 2025.

For the nine months ended September 30, 2026, net income available to common shareholders was $68.2 million, or $2.10 per basic common share and $2.08 per diluted common share, compared to net income available to common shareholders of $61.5 million, or $2.09 per basic common share and $2.08 per diluted common share, for the nine months ended September 30, 2025. Return on average assets, on an annualized basis, decreased to 1.03% for the nine months ended September 30, 2026, from 1.05% for the nine months ended September 30, 2025. Return on average common equity, on an annualized basis, decreased to 9.78% for the nine months ended September 30, 2026, as compared to 10.74% for the nine months ended September 30, 2025.

Net Interest Income

Our operating results depend primarily on our net interest income, calculated as the difference between interest income on interest-earning assets, such as loans and securities, and interest expense on interest-bearing liabilities, such as deposits and borrowings. Fluctuations in market interest rates impact the yield and rates paid on interest sensitive assets and liabilities. Changes in the amount and type of interest-earning assets and interest-bearing liabilities also impact net interest income. The variance driven by the changes in the amount and mix of interest-earning assets and interest-bearing liabilities is referred to as a “volume change.” Changes in yields earned on interest-earning assets and rates paid on interest-bearing deposits and other borrowed funds are referred to as a “rate change.”

To evaluate net interest income, we measure and monitor (1) yields on our loans and other interest-earning assets, (2) the costs of our deposits and other funding sources, (3) our net interest spread and (4) our net interest margin. Net interest spread is the difference between rates earned on interest-earning assets and rates paid on interest-bearing liabilities. Net interest margin is calculated as net interest income divided by average interest-earning assets. Because noninterest-bearing sources of funds, such as noninterest-bearing deposits and shareholders’ equity also fund interest-earning assets, net interest margin includes the benefit of these noninterest-bearing sources. We calculate average assets, liabilities, and equity using a daily average, and average yield/rate utilizing an actual day count convention.

For the three months ended September 30, 2026, net interest income totaled $80.7 million, and net interest margin and net interest spread were 3.86% and 3.09%, respectively, compared to $69.3 million, 3.68%, and 2.85%, respectively, for the three months ended September 30, 2025. The average yield on the loan portfolio was 6.74% for the three months ended September 30, 2026, compared to 7.01% for the three months ended September 30, 2025, and the average yield on total interest-earning assets was 6.10% for the three months ended September 30, 2026, compared to 6.31% for the three months ended September 30, 2025. For the three months ended September 30, 2026, overall cost of funds (which includes noninterest-bearing deposits) decreased 41 basis points compared to the three months ended September 30, 2025.

For the nine months ended September 30, 2026, net interest income totaled $233.7 million, and net interest margin and net interest spread were 3.75% and 3.00%, respectively, compared to $202.3 million, 3.68%, and 2.88%, respectively, for the nine months ended September 30, 2025. The average yield on the loan portfolio was 6.66% for the nine months ended September 30, 2026, compared to 6.99% for the nine months ended September 30, 2025, and the average yield on total interest-earning assets was 6.03% for the nine months ended September 30, 2026, compared to 6.32% for the nine months ended September 30, 2025. For the nine months ended September 30, 2026, overall cost of funds (which includes noninterest-bearing deposits) decreased 37 basis points compared to the nine months ended September 30, 2025.

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The following tables present, for the periods indicated, an analysis of net interest income by each major category of interest-earning assets and interest-bearing liabilities, the average amounts outstanding and the interest earned or paid on such amounts. The table also sets forth the average rate earned on interest-earning assets, the average rate paid on interest-bearing liabilities, and the net interest margin on average total interest-earning assets for the same periods. Interest earned on loans that are classified as nonaccrual is not recognized in income; however, the balances are reflected in average outstanding balances for the period. For the three and nine months ended September 30, 2026, and 2025, interest income not recognized on nonaccrual loans was not material. Any nonaccrual loans have been included in the tables as loans carrying a zero yield. The average total loans reflected below are net of deferred loan fees and discounts. Acquired loans were recorded at fair value at acquisition and accrete/amortize discounts and premiums as an adjustment to yield. Averages presented in the tables below, and throughout this report, are daily averages.


	For the Three Months Ended September 30,
	2026						2025
(Dollars in thousands) (Unaudited)	Average Outstanding Balance		Interest Earned/Interest Paid		Average Yield/Rate		Average Outstanding Balance		Interest Earned/Interest Paid		Average Yield/Rate
Assets
Interest-earning assets:
Total loans	$	6,670,021	$	113,263	6.74	%	$	6,036,622	$	106,662	7.01	%
Securities	1,054,664		9,207		3.46		978,502		7,554		3.06
Securities purchased under agreements to resell	32,316		359		4.41		25,490		330		5.14
Interest-bearing deposits in other banks	533,251		4,688		3.49		419,413		4,142		3.92
Total interest-earning assets	8,290,252		127,517		6.10		7,460,027		118,688		6.31
Allowance for loan losses	(62,716)						(58,468)
Noninterest-earning assets	617,511						519,600
Total assets	$	8,845,047	$	127,517			$	7,921,159	$	118,688
Liabilities and Shareholders' Equity
Interest-bearing liabilities:
Interest-bearing deposits	$	5,729,786	$	41,511	2.87	%	$	5,122,136	$	43,358	3.36	%
Subordinated debt	114,250		1,874		6.51		92,624		1,235		5.29
Subordinated debt - trust preferred securities	9,682		185		7.56		5,000		100		7.93

Advances from FHLB	300,381		3,120		4.12		424,287		4,547		4.25
Other borrowings	24,958		163		2.59		26,176		172		2.61
Total interest-bearing liabilities	6,179,057		46,853		3.01		5,670,223		49,412		3.46
Noninterest-bearing liabilities:
Noninterest-bearing deposits	1,573,300						1,315,064
Other liabilities	76,427						73,794
Total noninterest-bearing liabilities	1,649,727						1,388,858
Shareholders' equity:
Common shareholders' equity	944,333						790,148
Preferred equity	71,930						71,930
Total shareholders' equity	1,016,263						862,078
Total liabilities and shareholders' equity	$	8,845,047					$	7,921,159
Net interest rate spread (1)					3.09	%					2.85	%
Net interest income			$	80,664					$	69,276
Net interest margin (2)					3.86	%					3.68	%
Overall cost of funds					2.40	%					2.81	%

____________________________

(1)Net interest spread is the average yield on interest-earning assets minus the average rate on interest-bearing liabilities.

(2)Net interest margin is equal to net interest income divided by average interest-earning assets.

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	For the Nine Months Ended September 30,
	2026						2025
(Dollars in thousands) (Unaudited)	Average Outstanding Balance		Interest Earned/Interest Paid		Average Yield/Rate		Average Outstanding Balance		Interest Earned/Interest Paid		Average Yield/Rate
Assets
Interest-earning assets:
Total loans	$	6,708,583	$	334,189	6.66	%	$	6,001,647	$	313,682	6.99	%
Securities	1,062,728		26,773		3.37		946,961		21,074		2.98
Securities purchased under agreements to resell	29,906		996		4.45		35,740		1,382		5.17
Interest-bearing deposits in other banks	533,540		13,703		3.43		361,760		11,093		4.10
Total interest-earning assets	8,334,757		375,661		6.03		7,346,108		347,231		6.32
Allowance for loan losses	(62,191)						(56,718)
Noninterest-earning assets	613,518						536,438
Total assets	$	8,886,084	$	375,661			$	7,825,828	$	347,231
Liabilities and Shareholders' Equity
Interest-bearing liabilities:
Interest-bearing deposits	$	5,783,862	$	125,520	2.90	%	$	5,103,928	$	127,343	3.34	%
Subordinated debt	106,303		4,872		6.13		94,169		3,732		5.30
Subordinated debt - trust preferred securities	10,334		516		6.68		5,000		299		8.03

Advances from FHLB	346,337		10,615		4.10		411,444		13,136		4.27
Other borrowings	22,416		435		2.59		21,699		420		2.59
Total interest-bearing liabilities	6,269,252		141,958		3.03		5,636,240		144,930		3.44
Noninterest-bearing liabilities:
Noninterest-bearing deposits	1,537,842						1,284,745
Other liabilities	74,515						67,954
Total noninterest-bearing liabilities	1,612,357						1,352,699
Shareholders' equity:
Common shareholders' equity	932,545						764,959
Preferred equity	71,930						71,930
Total shareholders' equity	1,004,475						836,889
Total liabilities and shareholders' equity	$	8,886,084					$	7,825,828
Net interest rate spread (1)					3.00	%					2.88	%
Net interest income			$	233,703					$	202,301
Net interest margin (2)					3.75	%					3.68	%
Overall cost of funds					2.43	%					2.80	%

____________________________

(1)Net interest spread is the average yield on interest-earning assets minus the average rate on interest-bearing liabilities.

(2)Net interest margin is equal to net interest income divided by average interest-earning assets.

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The following tables present information regarding the dollar amount of changes in interest income and interest expense for the periods indicated for each major component of interest-earning assets and interest-bearing liabilities and distinguishes between the changes attributable to changes in volume and changes attributable to changes in interest rates. For the purposes of these tables, changes attributable to both rate and volume that cannot be segregated have been allocated to rate.


	For the Three Months Ended September 30, 2026 compared to the Three Months Ended September 30, 2025
	Increase (Decrease) due to change in
(Dollars in thousands) (Unaudited)	Volume		Rate		Total
Interest-earning assets:
Total loans	$	10,756	$	(4,155)	$	6,601
Securities	665		988		1,653
Securities purchased under agreements to resell	76		(47)		29
Interest-bearing deposits in other banks	1,001		(455)		546
Total increase (decrease) in interest income	$	12,498	$	(3,669)	$	8,829
Interest-bearing liabilities:
Interest-bearing deposits	$	4,402	$	(6,249)	$	(1,847)
Subordinated debt	355		284		639
Subordinated debt - trust preferred securities	89		(4)		85

Advances from FHLB	(1,287)		(140)		(1,427)
Other borrowings	(8)		(1)		(9)
Total increase (decrease) in interest expense	$	3,551	$	(6,110)	$	(2,559)
Increase in net interest income	$	8,947	$	2,441	$	11,388


	For the Nine Months Ended September 30, 2026 compared to the Nine Months Ended September 30, 2025
	Increase (Decrease) due to change in
(Dollars in thousands) (Unaudited)	Volume		Rate		Total
Interest-earning assets:
Total loans	$	35,216	$	(14,709)	$	20,507
Securities	2,917		2,782		5,699
Securities purchased under agreements to resell	(194)		(192)		(386)
Interest-bearing deposits in other banks	4,412		(1,802)		2,610
Total increase (decrease) in interest income	$	42,351	$	(13,921)	$	28,430
Interest-bearing liabilities:
Interest-bearing deposits	$	14,756	$	(16,579)	$	(1,823)
Subordinated debt	556		584		1,140
Subordinated debt - trust preferred securities	266		(49)		217
Advances from FHLB	(1,995)		(526)		(2,521)
Other borrowings	14		1		15
Total increase (decrease) in interest expense	$	13,597	$	(16,569)	$	(2,972)
Increase in net interest income	$	28,754	$	2,648	$	31,402

Provision for Credit Losses

Our provision for credit losses is a charge to income in order to bring our allowance for credit losses to a level deemed appropriate by management. For a description of the factors taken into account by management in determining the

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allowance for credit losses see “—Financial Condition—Allowance for Credit Losses.” The provision for credit losses was $1.9 million for the three months ended September 30, 2026, and $3.2 million for the same period in 2025. For the nine months ended September 30, 2026, and 2025, the provision for credit losses was $6.2 million and $8.2 million, respectively. The lower provision for the three and nine months ended September 30, 2026, compared to the same period in 2025 is primarily the result of lower specific reserve estimates and purchased credit deterioration reserves for the three and nine months ended September 30, 2026, as compared to the three and nine months ended September 30, 2025.

Noninterest Income (“Other Income”)

Our primary sources of noninterest income are service charges on deposit accounts, debit card and automated teller machine (“ATM”) fee income, income from bank-owned life insurance, fees and brokerage commissions, loan sales, swap fee income, and pass-through income from other investments (small business investment company (“SBIC”) partnerships and financial technology (“Fintech”) funds). The following tables present, for the periods indicated, the major categories of noninterest income:


	For the Three Months Ended September 30,
(Dollars in thousands) (Unaudited)	2026		2025		Increase (Decrease)
Noninterest income:
Service charges on deposit accounts	$	3,340	$	2,565	$	775
Debit card and ATM fee income	2,380		1,915		465
Cash value of life insurance income	979		802		177
Gain on sales of loans	814		624		190
(Loss) gain on sales of investment securities	(21)		77		(98)
Fees and brokerage commissions	2,458		1,880		578


Swap fee income	626		1,065		(439)
Pass-through (loss) income from other investments	(135)		133		(268)
Other	2,071		2,610		(539)
Total noninterest income	$	12,512	$	11,671	$	841


	For the Nine Months Ended September 30,
(Dollars in thousands) (Unaudited)	2026		2025		Increase (Decrease)
Noninterest income:
Service charges on deposit accounts	$	9,679	$	8,058	$	1,621
Debit card and ATM fee income	7,101		5,731		1,370
Cash value of life insurance income	2,712		2,368		344
Gain on sales of loans	3,738		2,661		1,077
Gain on sales of investment securities	53		29		24
Fees and brokerage commissions	7,106		6,008		1,098
Gain on sale of banking center	—		3,360		(3,360)
Gain on extinguishment/redemption of debt	545		630		(85)
Swap fee income	2,548		2,612		(64)
Pass-through income from other investments	14		638		(624)
Other	7,033		7,217		(184)
Total noninterest income	$	40,529	$	39,312	$	1,217

Total noninterest income increased $841,000, or 7.2%, from the three months ended September 30, 2025, mainly attributable to increases in service charges on deposit accounts of $775,000, or 30.2%, and debit card and ATM fee income of $465,000, or 24.3%, with both increases a result of increased activity from the Progressive acquisition, coupled with fees

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and brokerage commissions of $578,000, or 30.7%, partially offset by a decrease in swap fee income of $439,000, or 41.2%, compared to the three months ended September 30, 2025.

Total noninterest income increased $1.2 million, or 3.1%, from the nine months ended September 30, 2025, mainly attributable to increases in service charges on deposit accounts of $1.6 million, or 20.1%, and debit card and ATM fee income of $1.4 million, or 23.9%, with both increases a result of increased activity from the Progressive acquisition. The increase is also attributable to increases in gain on sales of loans of $1.1 million, or 40.5%, and fees and brokerage commissions of $1.1 million, or 18.3%. This increase is somewhat offset by the gain on the sale of our Kaplan banking center in 2025 with no such sale in 2026.

Noninterest Expense (“Other Expense”)

Generally, noninterest expense is composed of all employee expenses and costs associated with operating our facilities, obtaining and retaining customer relationships, and providing bank services. The largest component of noninterest expense is salaries and employee benefits. Noninterest expense also includes operational expenses, such as occupancy and equipment expenses, advertising and promotion expenses, data processing expenses, and professional and regulatory fees, including Federal Deposit Insurance Corporation (“FDIC”) assessments, among others.

The following tables present, for the periods indicated, the major categories of noninterest expense:


	For the Three Months Ended September 30,
(Dollars in thousands) (Unaudited)	2026		2025		Increase (Decrease)
Salaries and employee benefits	$	32,582	$	27,613	$	4,969
Non-staff expenses:
Occupancy and equipment expense	10,078		7,284		2,794
Advertising and promotions	2,064		1,205		859
Communications	773		582		191
Ad valorem shares tax	978		1,125		(147)
Data processing	3,084		3,972		(888)
Directors' fees	308		261		47
Insurance	188		420		(232)
Legal and professional fees	1,236		1,024		212
Office supplies and printing	268		286		(18)
Regulatory assessments	1,209		1,142		67
Merger and conversion related expenses	1,395		477		918
Other	6,302		3,491		2,811
Total noninterest expense	$	60,465	$	48,882	$	11,583

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	For the Nine Months Ended September 30,
(Dollars in thousands) (Unaudited)	2026		2025		Increase (Decrease)
Salaries and employee benefits	$	98,741	$	85,427	$	13,314
Non-staff expenses:
Occupancy and equipment expense	26,479		21,802		4,677
Advertising and promotions	6,178		3,584		2,594
Communications	2,063		1,763		300
Ad valorem shares tax	2,933		3,375		(442)
Data processing	10,113		12,529		(2,416)
Directors' fees	815		733		82
Insurance	1,031		1,248		(217)
Legal and professional fees	3,982		3,130		852
Office supplies and printing	859		897		(38)
Regulatory assessments	3,727		3,332		395
Merger and conversion related expenses	3,075		937		2,138
Other	17,465		11,909		5,556
Total noninterest expense	$	177,461	$	150,666	$	26,795

Total noninterest expense increased $11.6 million, or 23.7%, from the three months ended September 30, 2025, primarily attributed to increases in salaries and employee benefits of $5.0 million, or 18.0%, and in occupancy and equipment of $2.8 million, or 38.4%, with these increases primarily attributable to increased headcount and properties from the Progressive acquisition coupled with a lease termination fee recorded during 2026.

Total noninterest expense increased $26.8 million, or 17.8%, from the nine months ended September 30, 2025, primarily attributed to increases in salaries and employee benefits of $13.3 million, or 15.6%, occupancy and equipment of $4.7 million, or 21.5%, advertising and promotions of $2.6 million, or 72.4%, and merger and conversion related expenses of $2.1 million, or 228.2%, which were partially offset by a decrease in data processing fees of $2.4 million, or 19.3%. The increases in these categories were largely attributable to the acquisition of Progressive and a lease termination fee recorded during 2026.

Income Tax Expense

The amount of income tax expense is influenced by the amounts of our pre-tax income, tax-exempt income and other nondeductible expenses. Deferred tax assets and liabilities are reflected at currently enacted income tax rates in effect for the period in which the deferred tax assets and liabilities are expected to be realized or settled. As changes in tax laws or rates are enacted, deferred tax assets and liabilities are adjusted through the provision for income taxes. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized.

For the three months ended September 30, 2026, income tax expense totaled $6.2 million, an increase of $195,000, or 3.2%, compared to $6.0 million for the same period in 2025. Our effective tax rates for the three months ended September 30, 2026, and 2025 were 20.2% and 20.9%, respectively.

For the nine months ended September 30, 2026, income tax expense totaled $18.3 million, an increase of $1.0 million, or 6.1%, compared to $17.2 million for the same period in 2025. Our effective tax rates for the nine months ended September 30, 2026, and 2025 were 20.2% and 20.8%, respectively.

Financial Condition

Our total assets increased $741.2 million, or 9.0%, from December 31, 2025, to September 30, 2026, primarily due to the acquisition of Progressive.

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Loan Portfolio

Our primary source of income is interest on loans to individuals, professionals and small-to-midsized businesses located in our markets. Our loan portfolio consists primarily of commercial loans and real estate loans secured by commercial real estate properties located in our primary market areas. Our loan portfolio represents the highest yielding component of our earning asset base.

As of September 30, 2026, total loans, excluding mortgage loans held for sale, were $6.8 billion, a $591.4 million increase, or 9.6%, compared to $6.2 billion as of December 31, 2025. Additionally, $254,000 and $1.1 million in loans were classified as loans held for sale as of September 30, 2026, and December 31, 2025, respectively.

In June 2026, we sold $95.3 million in loans that were acquired from Progressive, including $54.7 million of residential mortgages and $40.6 million commercial real estate loans. As part of the sale, we will retain the servicing of these loans.

Total loans held for investment as a percentage of total deposits were 91.9% and 92.4% as of September 30, 2026, and December 31, 2025, respectively. Total loans held for investment as a percentage of total assets were 75.7% and 75.3% as of September 30, 2026, and December 31, 2025, respectively.

The following table summarizes our loan portfolio by type of loan as of the dates indicated.


	As of September 30, 2026 (Unaudited)				As of December 31, 2025
(Dollars in thousands)	Amount		Percent		Amount		Percent
Real Estate Loans:
Commercial
Real estate rental and leasing	$	1,640,790	24.2	%	$	1,456,484	23.5	%
Accommodation and food services	271,769		4.0		247,951		4.0
Other services (except public administration)	158,025		2.3		160,548		2.6
Health care and social assistance	120,685		1.8		121,850		2.0
Finance and insurance	94,134		1.4		84,592		1.4
Construction	78,873		1.2		63,931		1.0
Manufacturing	49,384		0.7		73,369		1.2
Agriculture, forestry, fishing and hunting	68,726		1.0		42,730		0.7
Transportation and warehousing	16,204		0.2		22,070		0.4
Other	398,117		5.9		337,754		5.4
Total Commercial	2,896,707		42.7		2,611,279		42.2
Construction	774,170		11.4		639,069		10.3
Residential	1,048,400		15.5		944,065		15.3
Total Real Estate Loans	4,719,277		69.6		4,194,413		67.8
Commercial	1,990,998		29.4		1,921,833		31.0
Consumer and Other	70,612		1.0		73,244		1.2
Total loans held for investment	$	6,780,887	100.0	%	$	6,189,490	100.0	%

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The following table summarizes our commercial real estate loan portfolio by region as of the dates indicated.


	As of September 30, 2026 (Unaudited)				As of December 31, 2025
(Dollars in thousands)	Amount		Percent		Amount		Percent
Commercial real estate loans:
Dallas Region	$	693,140	23.9	%	$	720,436	27.6	%
New Orleans Region	525,260		18.1		505,447		19.3
North Louisiana Region	702,572		24.3		454,909		17.4
Capitol Region	314,402		10.9		323,420		12.4
Houston Region	227,072		7.8		240,422		9.2
Southwest Louisiana Region	342,496		11.8		280,889		10.8
Bayou Region	91,765		3.2		85,756		3.3
Total commercial real estate loans	$	2,896,707	100.0	%	$	2,611,279	100.0	%

Real Estate: Commercial loans increased $285.4 million, or 10.9%, to $2.9 billion as of September 30, 2026, from $2.6 billion as of December 31, 2025.

Real Estate: Construction loans include loans to small-to-midsized businesses to construct owner-occupied properties, loans to developers of commercial real estate investment properties and residential developments and, to a lesser extent, loans to individual clients for construction of single-family homes in our market areas. Risks associated with these loans include fluctuations in the value of real estate, project completion risk and changes in market trends. We are also exposed to risk based on the ability of the construction loan borrower to finance the loan or sell the property upon completion of the project, which may be affected by changes in secondary market terms and criteria for permanent financing since the time we funded the loan.

Real Estate: Construction loans increased $135.1 million, or 21.1%, to $774.2 million as of September 30, 2026, from $639.1 million as of December 31, 2025.

Real Estate: Residential loans increased $104.3 million, or 11.1%, to $1.0 billion as of September 30, 2026, from $944.1 million as of December 31, 2025.

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Commercial loans increased $69.2 million, or 3.6%, to $2.0 billion as of September 30, 2026, from $1.9 billion as of December 31, 2025.

Consumer and other loans decreased $2.6 million, or 3.6%, to $70.6 million as of September 30, 2026, from $73.2 million as of December 31, 2025.

The contractual maturity ranges of loans in our loan portfolio and the amount of such loans with fixed and floating interest rates in each maturity range as of the date indicated are summarized in the following table:


	As of September 30, 2026
(Dollars in thousands) (Unaudited)	One Year or Less		One Through Five Years		Five Through Fifteen Years		After Fifteen Years		Total
Real Estate Loans:
Commercial	$	780,545	$	1,677,415	$	391,496	$	47,251	$	2,896,707
Construction	290,730		367,811		83,015		32,614		774,170
Residential	268,071		410,196		197,213		172,920		1,048,400
Total Real Estate Loans	1,339,346		2,455,422		671,724		252,785		4,719,277
Commercial	914,161		858,624		205,749		12,464		1,990,998
Consumer and Other	39,905		24,570		5,995		142		70,612
Total loans held for investment	$	2,293,412	$	3,338,616	$	883,468	$	265,391	$	6,780,887









Total fixed rate loans	$	1,044,381	$	1,677,964	$	417,696	$	55,395	$	3,195,436









Total floating rate loans	1,249,031		1,660,652		465,772		209,996		3,585,451

Nonperforming Assets

Loans are considered past due if the required principal and interest payments have not been received as of the date such payments were due. Loans are placed on nonaccrual status when, in management’s opinion, the borrower may be unable to meet payment obligations as they become due, as well as when required by regulatory provisions. Loans may be placed on nonaccrual status regardless of whether or not such loans are considered past due. When interest accrual is discontinued, all unpaid accrued interest is generally reversed. Interest income is subsequently recognized only to the extent cash payments are received in excess of principal due, or interest may be recognized on a cash basis as long as the remaining book balance of the loan is deemed collectible. Loans are returned to accrual status when all the principal and interest amounts contractually due are brought current and future payments are reasonably assured.

We have several procedures in place to assist in maintaining the overall quality of our loan portfolio. We have established underwriting guidelines to be followed by our bankers, and we also monitor our delinquency levels for any negative or adverse trends. There can be no assurance, however, that our loan portfolio will not become subject to increasing pressures from deteriorating borrower credit due to general economic conditions.

We believe our conservative lending approach and focused management of nonperforming assets have resulted in sound asset quality and the timely resolution of problem assets. We had $108.8 million and $89.7 million in nonperforming assets as of September 30, 2026, and December 31, 2025, respectively. We had $84.1 million in nonperforming loans as of September 30, 2026, compared to $76.7 million as of December 31, 2025. The increase in nonperforming assets from December 31, 2025 to September 30, 2026 is primarily due to adding three commercial lending relationships to nonaccrual status coupled with the addition of a Texas other real estate owned property.

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The following tables present information regarding nonperforming assets at the dates indicated:


(Dollars in thousands)	As of September 30, 2026 (Unaudited)			As of December 31, 2025
Nonaccrual loans	$	80,363		$	74,471
Accruing loans 90 or more days past due	3,701			2,215
Total nonperforming loans	84,064			76,686
Other nonperforming assets	—			—
Other real estate owned:
Commercial real estate, construction, land and land development	23,528			12,192
Residential real estate	1,233			821
Total other real estate owned	24,761			13,013
Total nonperforming assets	$	108,825		$	89,699
Ratio of nonperforming loans to total loans held for investment	1.24		%	1.24		%
Ratio of nonperforming assets to total assets	1.22			1.09
Ratio of nonaccrual loans to total loans held for investment	1.19			1.20


(Dollars in thousands)	As of September 30, 2026 (Unaudited)		As of December 31, 2025
Nonaccrual loans by category:
Real Estate Loans:
Commercial	$	18,245	$	36,252
Construction	8,608		4,539
Residential	14,364		10,144
Total Real Estate Loans	41,217		50,935
Commercial	38,909		23,370
Consumer and Other	237		166
Total	$	80,363	$	74,471

Potential Problem Loans

From a credit risk standpoint, we classify loans in one of four categories: pass, special mention, substandard or doubtful. Loans classified as loss are charged-off. The classifications of loans reflect a judgment about the risks of default and loss associated with the loan. Ratings are adjusted to reflect the degree of risk and loss that is believed to be inherent in each credit. Our methodology is structured so that specific allocations are increased in accordance with deterioration in credit quality (and a corresponding increase in risk of loss) or decreased in accordance with improvement in credit quality (and a corresponding decrease in risk of loss).

For additional information, see Note 5 of the consolidated financial statements for a summary of loans by credit quality indicators.

Allowance for Credit Losses

We maintain an allowance for credit losses, which includes both our allowance for loan losses and reserves for unfunded commitments, that represents management’s best estimate of the credit losses and risks inherent in the loan portfolio. In determining the allowance for credit losses, we estimate losses on specific loans, or groups of loans, where the probable loss can be identified and reasonably determined. The balance of the allowance for credit losses is based on internally assigned risk classifications of loans, changes in the nature of the loan portfolio, overall portfolio quality, industry concentrations, delinquency trends, current economic factors and the estimated impact of current economic

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conditions on certain historical credit loss rates. For additional information, see Note 5 to the consolidated financial statements.

In connection with our review of the loan portfolio, we consider risk elements attributable to particular loan types or categories in assessing the quality of individual loans. Some of the risk elements we consider include:

•for Real Estate: Commercial loans, the debt service coverage ratio (income from the property in excess of operating expenses compared to loan payment requirements), operating results of the owner in the case of owner-occupied properties, the loan to value ratio, the age and condition of the collateral, and the volatility of income, property value and future operating results typical for properties of that type;

•for Real Estate: Construction loans, the perceived feasibility of the project including the ability to sell developed lots or improvements constructed for resale or the ability to lease property constructed for lease, the quality and nature of contracts for presale or prelease, if any, the experience and ability of the developer, and the loan to value ratio;

•for Real Estate: Residential real estate loans, the borrower’s ability to repay the loan, including a consideration of the debt to income ratio and employment and income stability, the loan to value ratio, and the age, condition and marketability of the collateral; and

•for Commercial loans, the operating results of the commercial, industrial or professional enterprise, the borrower’s business, professional and financial ability and expertise, the specific risks and volatility of income and operating results typical for businesses in that category, and the value, nature and marketability of collateral;

As of September 30, 2026, the allowance for credit losses totaled $64.3 million, or 0.95%, of total loans held for investment. As of December 31, 2025, the allowance for credit losses totaled $58.1 million, or 0.94%, of total loans held for investment.

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The following tables present, as of and for the periods indicated, an analysis of the allowance for credit losses and other related data:


(Dollars in thousands)	As of and For the Nine Months Ended September 30, 2026 (Unaudited)			As of and For the Year Ended December 31, 2025
Average loans outstanding	$	6,708,583		$	6,023,214
Gross loans held for investment outstanding end of period	$	6,780,887		$	6,189,490
Allowance for credit losses at beginning of period	$	58,136		$	58,528
Adjustment for Progressive purchased credit deterioration loans	9,264			—
Provision for credit losses	6,207			11,318
Charge-offs:
Real Estate:
Commercial	1,877			4,116
Construction	147			20
Residential	162			242
Total Real Estate	2,186			4,378
Commercial	6,763			6,768
Consumer and other	1,150			1,991
Total charge-offs	10,099			13,137
Recoveries:
Real Estate:
Commercial	112			30
Construction	4			211
Residential	69			33
Total Real Estate	185			274
Commercial	400			839
Consumer and other	173			314
Total recoveries	758			1,427
Net charge-offs	9,341			11,710
Allowance for credit losses at end of period	$	64,266		$	58,136
Ratio of allowance for credit losses to end of period loans held for investment	0.95		%	0.94		%
Ratio of net charge-offs to average loans	0.14			0.19
Ratio of allowance for credit losses to nonaccrual loans	79.97			78.07

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	As of and For the Nine Months Ended September 30, 2026 (Unaudited)				As of and For the Year Ended December 31, 2025				As of and For the Nine Months Ended September 30, 2025 (Unaudited)
(Dollars in thousands)	Net Charge-offs		Percent of Average Loans		Net Charge-offs (Recoveries)		Percent of Average Loans		Net Charge-offs (Recoveries)		Percent of Average Loans
Real estate:
Commercial	$	1,765	0.03	%	$	4,086	0.07	%	$	1,668	0.03	%
Construction	143		0.00		(191)		0.00		(180)		0.00
Residential	93		0.00		209		0.00		215		0.00
Total Real Estate Loans	2,001		0.03		4,104		0.07		1,703		0.03
Commercial	6,363		0.10		5,929		0.10		1,874		0.03
Consumer and Other	977		0.01		1,677		0.02		1,289		0.02
Total net charge-offs	$	9,341	0.14	%	$	11,710	0.19	%	$	4,866	0.08	%

Although we believe that we have established our allowance for credit losses in accordance with U.S. GAAP and that the allowance for credit losses was adequate to provide for known and estimated losses in the portfolio at all times shown above, future provisions will be subject to ongoing evaluations of the risks in our loan portfolio. If we experience economic declines or if asset quality deteriorates, material additional provisions could be required.

The following table shows the allocation of the allowance for credit losses among loan categories and certain other information as of the dates indicated. The allocation of the allowance for credit losses as shown in the table should neither be interpreted as an indication of future charge-offs, nor as an indication that charge-offs in future periods will necessarily occur in these amounts or in the indicated proportions. The total allowance is available to absorb losses from any loan category.


	As of September 30, 2026 (Unaudited)				As of December 31, 2025				As of September 30, 2025 (Unaudited)
(Dollars in thousands)	Amount		Percent to Total		Amount		Percent to Total		Amount		Percent to Total
Real estate:
Commercial	$	23,886	37.2	%	$	23,806	40.9	%	$	18,741	30.3	%
Construction	6,247		9.7		4,416		7.6		9,475		15.3
Residential	6,575		10.2		7,732		13.3		8,622		13.9
Total real estate	36,708		57.1		35,954		61.8		36,838		59.5
Commercial	27,065		42.1		21,618		37.2		24,491		39.6
Consumer and Other	493		0.8		564		1.0		553		0.9
Total allowance for credit losses	$	64,266	100.0	%	$	58,136	100.0	%	$	61,882	100.0	%

Securities

We use our securities portfolio to provide a source of liquidity, an appropriate return on funds invested, manage interest rate risk, meet collateral requirements, and meet regulatory capital requirements. As of September 30, 2026, the carrying amount of investment securities totaled $986.7 million, a decrease of $2.5 million, or 0.3%, compared to $989.2 million as of December 31, 2025. The decrease was primarily due to unrealized losses in our investment portfolio, partially offset by securities added through the Progressive acquisition. Securities represented 11.0% and 12.0% of total assets as of September 30, 2026, and December 31, 2025, respectively.

Our investment portfolio consists entirely of securities classified as available for sale. As a result, the carrying values of our investment securities are adjusted for unrealized gain or loss, and any gain or loss is reported on an after-tax

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basis as a component of other comprehensive income in shareholders’ equity. The following tables summarize the amortized cost and estimated fair value of investment securities as of the dates shown:


	As of September 30, 2026
(Dollars in thousands) (Unaudited)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
U.S. treasury securities	$	19,684	$	—	$	237	$	19,447
U.S. government agencies	250		—		1		249
Corporate bonds	87,062		142		2,016		85,188
Mortgage-backed securities	694,677		169		43,191		651,655
Municipal securities	254,650		6		24,491		230,165
Total	$	1,056,323	$	317	$	69,936	$	986,704


	As of December 31, 2025
(Dollars in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
U.S. treasury securities	$	17,571	$	—	$	293	$	17,278
U.S. government agencies	10,070		—		196		9,874
Corporate bonds	38,324		377		1,639		37,062
Mortgage-backed securities	674,211		3,153		27,273		650,091
Municipal securities	291,256		536		16,868		274,924
Total	$	1,031,432	$	4,066	$	46,269	$	989,229

All of our mortgage-backed securities are agency securities. We do not hold any Fannie Mae or Freddie Mac preferred stock, private label collateralized mortgage obligations, subprime, Alt-A, or second lien elements in our investment portfolio as of September 30, 2026.

The allowance for credit losses encompasses potential expected credit losses related to the securities portfolio. In order to develop an estimate of credit losses expected for the current securities portfolio, we perform an assessment that includes reviewing historical loss data for both our portfolio and similar types of investment securities. Additionally, our review of the securities portfolio for expected credit losses includes an evaluation of factors including the security issuer bond ratings, delinquency status, insurance or other available credit support, as well as our expectations of the forecasted economic outlook relevant to these securities. The results of the analysis are evaluated quarterly to confirm that credit loss estimates are appropriate for the securities portfolio. Based on our assessments, expected credit losses on the investment securities portfolio as of both September 30, 2026 and December 31, 2025, was negligible and therefore, no allowance for credit loss was recorded related to our investment securities.

As of September 30, 2026, and December 31, 2025, the Company held other equity securities of $40.0 million and $49.3 million, respectively, comprised mainly of FHLB stock, SBICs and Fintech fund investments.

Deposits

We offer a variety of deposit accounts having a wide range of interest rates and terms including demand, savings, money market and time accounts. We rely primarily on competitive pricing policies, convenient locations and personalized service to attract and retain these deposits.

Total deposits as of September 30, 2026, were $7.4 billion, an increase of $678.2 million, or 10.1%, compared to $6.7 billion as of December 31, 2025. Total uninsured deposits were $3.6 billion, or 49.0% of total deposits as of September 30, 2026 compared to $2.9 billion, or 43.2%, of total deposits as of December 31, 2025. Since it is not reasonably practical to provide a precise measure of uninsured deposits, the amounts are estimated and are based on the same methodologies and assumptions that are used for regulatory reporting requirements for the call report.

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Noninterest-bearing deposits as of September 30, 2026, were $1.6 billion, compared to $1.3 billion as of December 31, 2025, an increase of $283.6 million, or 21.5%.

Average deposits for the nine months ended September 30, 2026, were $7.3 billion, an increase of $891.0 million, or 13.9%, over the full year average for the year ended December 31, 2025, of $6.4 billion. The increase was largely attributable to the impact of the acquisition of Progressive on January 1, 2026. The average rate paid on total interest-bearing deposits decreased over this period from 3.29% for the year ended December 31, 2025, to 2.90% for the nine months ended September 30, 2026. In addition, noninterest-bearing demand accounts served to reduce the cost of deposits to 2.29% for the nine months ended September 30, 2026, compared to 2.63% for the year ended December 31, 2025.

The following table presents the daily average balances and weighted average rates paid on deposits for the periods indicated:


	For the Nine Months Ended September 30, 2026 (Unaudited)				For the Year Ended December 31, 2025
(Dollars in thousands)	Average Balance		Average Rate		Average Balance		Average Rate
Interest-bearing demand accounts	$	896,613	2.24	%	$	807,107	2.54	%
Negotiable order of withdrawal ("NOW") accounts	379,046		2.06		303,167		2.51
Limited access money market accounts and savings	3,167,725		2.88		2,601,497		3.24
Certificates and other time deposits > $250k	731,102		3.86		783,326		4.19
Certificates and other time deposits < $250k	609,376		3.36		639,425		3.70
Total interest-bearing deposits	5,783,862		2.90		5,134,522		3.29
Noninterest-bearing demand accounts	1,537,842		—		1,296,162		—
Total deposits	$	7,321,704	2.29	%	$	6,430,684	2.63	%

The ratio of average noninterest-bearing deposits to average total deposits for the nine months ended September 30, 2026, and the year ended December 31, 2025, was 21.0% and 20.2%, respectively.

Federal Funds Purchased Lines of Credit Relationships

We maintain Federal Funds Purchased Lines of Credit Relationships with the following correspondent banks with limits as of September 30, 2026:


(Dollars in thousands)	Fed Funds Purchase Limits
TIB National Association	$	45,000
PNC Bank	38,000
FNBB	35,000
First Horizon Bank	17,000
ServisFirst Bank	10,000
Total	$	145,000

We had no outstanding balances on these lines at both September 30, 2026 and December 31, 2025.

Liquidity and Capital Resources

Liquidity

Liquidity involves our ability to utilize funds to support asset growth and acquisitions or reduce assets to meet deposit withdrawals and other payment obligations, to maintain reserve requirements and otherwise to operate on an ongoing basis and manage unexpected events. For the nine months ended September 30, 2026, and the year ended

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December 31, 2025, liquidity needs were primarily met by core deposits, security and loan maturities, and amortizing investment and loan portfolios. In addition, we also utilize, or have available, brokered deposits, purchased funds from correspondent banks, the Federal Reserve discount window, and overnight advances from the FHLB. As of September 30, 2026, and December 31, 2025, we maintained five federal funds purchased lines of credit with correspondent banks which provided for extensions of credit with an availability to borrow up to an aggregate of $145.0 million. There were no funds drawn under these lines of credit at September 30, 2026, and December 31, 2025. We had an additional $1.6 billion and $1.2 billion of availability through the FHLB as of September 30, 2026, and December 31, 2025, respectively. As of September 30, 2026 and December 31, 2025, we had $1.1 billion and $967.3 million, respectively, of availability through the Federal Reserve Discount Window.

As of September 30, 2026, we had outstanding $2.1 billion in commitments to extend credit and $54.5 million in commitments associated with outstanding standby and commercial letters of credit. As of December 31, 2025, we had outstanding $1.7 billion in commitments to extend credit and $51.2 million in commitments associated with outstanding standby and commercial letters of credit. Because commitments associated with letters of credit and commitments to extend credit may expire unused, the total outstanding may not necessarily reflect the actual future cash funding requirements. See “Off Balance Sheet Items” below for additional information.

As of September 30, 2026, and December 31, 2025 we had cash and cash equivalents, including federal funds sold and securities purchased under agreements to resell, of $680.0 million and $609.2 million, respectively. We had no exposure to future cash requirements associated with known uncertainties or capital expenditures of a material nature for either period.

Capital Resources

Total shareholders’ equity increased to $1.0 billion as of September 30, 2026, compared to $896.9 million as of December 31, 2025, an increase of $105.6 million, or 11.8%. This increase was primarily due to stock issued to complete the acquisition of Progressive of $83.4 million coupled with net income of $72.3 million, with this increase offset by other comprehensive losses of $21.6 million resulting from the after-tax effect of unrealized losses in our investment securities portfolio, repurchased shares of $13.9 million and dividends paid on preferred stock and common stock of $18.7 million.

On October 22, 2026, our Board declared a quarterly dividend in the amount of $18.75 per preferred share to the preferred shareholders of record as of November 15, 2026. The dividend is to be paid on November 30, 2026, or as soon as practicable thereafter.

On October 22, 2026, our Board declared a quarterly dividend based upon our financial performance for the three months ended September 30, 2026, in the amount of $0.15 per common share to the common shareholders of record as of November 15, 2026. The dividend is to be paid on November 30, 2026, or as soon as practicable thereafter.

The declaration and payment of dividends to our shareholders, as well as the amounts thereof, are subject to the discretion of the Board and depend upon our results of operations, financial condition, capital levels, cash requirements, future prospects and other factors deemed relevant by the Board. As a holding company, our ability to pay dividends is largely dependent upon the receipt of dividends from our subsidiary, b1BANK. There can be no assurance that we will declare and pay any dividends to our shareholders.

Capital management consists of providing equity to support current and future operations. Banking regulators view capital levels as important indicators of an institution’s financial soundness. As a general matter, FDIC-insured depository institutions and their holding companies are required to maintain minimum capital relative to the amount and types of assets they hold. We are subject to regulatory capital requirements at the holding company and bank levels. As of September 30, 2026, and December 31, 2025, we and b1BANK were in compliance with all applicable regulatory capital requirements, and b1BANK was classified as “well-capitalized,” for purposes of prompt corrective action regulations. As we employ our capital and continue to grow our operations, our regulatory capital levels may decrease depending on our level of earnings. However, we expect to monitor and control our growth in order to remain in compliance with all applicable regulatory capital standards applicable to us.

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The following table presents the actual capital amounts and regulatory capital ratios for us and b1BANK as of the dates indicated.


	As of September 30, 2026 (Unaudited)				As of December 31, 2025
(Dollars in thousands)	Amount		Ratio		Amount		Ratio
Business First
Total capital (to risk weighted assets)	$	1,081,902	13.55	%	$	939,331	12.93	%
Tier 1 capital (to risk weighted assets)	903,386		11.31		799,527		11.00
Common Equity Tier 1 capital (to risk weighted assets)	821,767		10.29		722,597		9.94
Tier 1 Leverage capital (to average assets)	903,386		10.36		799,527		10.08

b1BANK
Total capital (to risk weighted assets)	$	1,055,005	13.23	%	$	930,600	12.82	%
Tier 1 capital (to risk weighted assets)	990,739		12.42		872,464		12.02
Common Equity Tier 1 capital (to risk weighted assets)	990,739		12.42		872,464		12.02
Tier 1 Leverage capital (to average assets)	990,739		11.37		872,464		11.01

FHLB Advances

Advances from the FHLB totaled approximately $334.2 million and $431.2 million at September 30, 2026 and December 31, 2025, respectively. As of September 30, 2026, and December 31, 2025, the FHLB advances were collateralized by a blanket floating lien on certain securities and loans, had a weighted average stated rate of 4.18% and 4.02%, respectively, and mature within ten years.

Contractual Obligations

The following tables summarize contractual obligations and other commitments to make future payments as of September 30, 2026, and December 31, 2025 (other than non-maturity deposit obligations), which consist of future cash payments associated with our contractual obligations pursuant to our FHLB advances, subordinated debt, revolving line of credit, and non-cancelable future operating leases. Payments related to leases are based on actual payments specified in underlying contracts. Advances from the FHLB totaled approximately $334.2 million and $431.2 million at September 30, 2026 and December 31, 2025, respectively. As of September 30, 2026, and December 31, 2025, the FHLB advances were collateralized by a blanket floating lien on certain securities and loans, had a weighted average stated rate of 4.18% and 4.02%, respectively, and mature within ten years. Subordinated debt totaled $114.3 million and $92.5 million at September 30, 2026 and December 31, 2025, respectively, including premium. During the second quarter of 2026, we completed an $85.0 million private placement of subordinated debt with a fixed rate of 6.50% through March 30, 2031, and a floating rate, based on a benchmark rate plus 300 basis points, thereafter through maturity in 2036. We have an additional $25.0 million of subordinated debt which bears interest at a fixed rate of 6.75% through December 31, 2028 and a floating rate, based on a benchmark rate plus 369 basis points, thereafter through maturity in 2033. During the second quarter of 2026, we redeemed $66.9 million in outstanding subordinated notes including the recognition of a $545,000 gain. As part of the APC acquisition, we issued $4.3 million of subordinated notes with a fixed rate of 6.50% through June 30, 2031, and a floating rate, based on a benchmark rate plus 300 basis points, thereafter through maturity in 2036. We acquired two additional trust preferred securities as part of the Progressive acquisition totaling $5.2 million. Of the trust preferred securities, $4.0 million bears an adjustable interest rate plus 1.45%, based on a benchmark rate, adjusting quarterly, until maturity on December 15, 2037, and $1.2 million bears an adjustable rate plus 3.58%, based on a benchmark rate, adjusting quarterly, until maturity on July 31, 2031. As part of valuing these two trust preferred securities from Progressive, we incurred a fair value adjustment of $555,000 and will amortize this over 12 years, with $521,000 remaining at September 30, 2026.

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	As of September 30, 2026
(Dollars in thousands) (Unaudited)	1 year or less		More than 1 year but less than 3 years		3 years or more but less than 5 years		5 years or more		Total
Non-cancelable future operating leases	$	7,199	$	10,419	$	5,730	$	4,009	$	27,357
Time deposits	946,867		218,784		7,768		—		1,173,419
Subordinated debt	—		—		—		114,250		114,250
Advances from FHLB	182,578		75,000		26,611		50,000		334,189

Subordinated debt - trust preferred securities	—		—		1,210		9,000		10,210
Securities sold under agreements to repurchase	24,896		—		—		—		24,896
Standby and commercial letters of credit	51,830		2,607		46		—		54,483
Commitments to extend credit	1,414,379		521,499		105,634		91,886		2,133,398
Total	$	2,627,749	$	828,309	$	146,999	$	269,145	$	3,872,202


	As of December 31, 2025
(Dollars in thousands)	1 year or less		More than 1 year but less than 3 years		3 years or more but less than 5 years		5 years or more		Total
Non-cancelable future operating leases	$	5,896	$	10,510	$	7,382	$	6,383	$	30,171
Time deposits	1,170,413		227,926		9,106		—		1,407,445
Subordinated debt	—		17,500		—		74,427		91,927
Advances from FHLB	256,200		100,000		25,000		50,000		431,200

Subordinated debt - trust preferred securities	—		—		—		5,000		5,000
Securities sold under agreements to repurchase	22,622		—		—		—		22,622
Standby and commercial letters of credit	47,671		3,486		86		—		51,243
Commitments to extend credit	1,121,371		405,515		97,958		71,259		1,696,103
Total	$	2,624,173	$	764,937	$	139,532	$	207,069	$	3,735,711

Off-Balance Sheet Items

In the normal course of business, we enter into various transactions which, in accordance with U.S. GAAP, are not included in our consolidated balance sheets. We enter into these transactions to meet the financing needs of our customers. These transactions include commitments to extend credit and standby and commercial letters of credit which involve, to varying degrees, elements of credit risk and interest rate risk in excess of the amounts recognized in the consolidated balance sheets.

Our commitments associated with outstanding standby and commercial letters of credit and commitments to extend credit expiring by period as of the date indicated are summarized in the tables above. Because commitments associated with letters of credit and commitments to extend credit may expire unused, the amounts shown do not necessarily reflect the actual future cash funding requirements.

Standby and commercial letters of credit are conditional commitments issued by us to guarantee the performance of a customer to a third party. In the event of nonperformance by the customer, we have rights to the underlying collateral, which can include commercial real estate, physical plant and property, inventory, receivables, cash and/or marketable securities. The credit risk to us in issuing letters of credit is essentially the same as that involved in extending loan facilities to our customers.

Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Because many of the commitments are expected to expire without being fully drawn upon, the

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total commitment amounts disclosed above do not necessarily represent future cash requirements. We evaluate each customer’s creditworthiness on a case-by-case basis. The amount of collateral obtained, if considered necessary by us, upon extension of credit, is based on management’s credit evaluation of the customer.

Interest Rate Sensitivity and Market Risk

As a financial institution, our primary component of market risk is sensitivity to movement in interest rates. Our asset and liability management policy provides management with the guidelines for effective interest rate risk management, and we have established a measurement system for monitoring our net interest rate sensitivity position. We manage our sensitivity position within our established guidelines.

Fluctuations in interest rates will ultimately impact both the level of income and expense recorded on most of our assets and liabilities, and the market value of all interest-earning assets and interest-bearing liabilities. Interest rate risk is the potential of economic losses due to future interest rate changes. These economic losses can be reflected as a loss of future net interest income and/or a loss of current fair market value of equity. The objective of interest rate risk management is to measure the effect on net interest income and fair value of equity and to position the balance sheet to minimize the risk of losses and maximize the amount of income without taking on unnecessary earning volatility.

We seek to manage our exposure to interest rates by structuring our balance sheet in the ordinary course of business; however, we may enter into derivative contracts to hedge interest rate risk if it is appropriate given our risk profile and policy guidelines. Based upon the nature of our operations, we are not subject to foreign exchange or commodity price risk. We do not own any trading assets.

Our exposure to interest rate risk is managed by the asset-liability committee (“ALCO”) of b1BANK, in accordance with policies approved by our board of directors. In determining the appropriate level of interest rate risk, the committee considers the impact on earnings and capital of the current outlook on interest rates, potential changes in interest rates, regional economies, liquidity, business strategies and other factors. The committee meets regularly to review, among other things, the sensitivity of assets and liabilities to interest rate changes, the book and market values of assets and liabilities, unrealized gains and losses, purchase and sale activities, commitments to originate loans and the maturities of investments and borrowings. Additionally, the committee reviews liquidity, cash flow flexibility, maturities of deposits and consumer and commercial deposit activity. Management employs methodologies to manage interest rate risk which include an analysis of relationships between interest-earning assets and interest-bearing liabilities, and an interest rate shock simulation model.

We use interest rate risk simulation models and shock analysis to test the interest rate sensitivity of net interest income and fair value of equity, and the impact of changes in interest rates on other financial metrics. Contractual maturities and re-pricing opportunities of loans are incorporated in the model as prepayment assumptions, maturity data and optionality. Deposit assumptions such as repricing betas and non-maturity balance decay rates are also incorporated into the model. Model assumptions are revised and updated on a regular basis as directed by policy, and more frequently if conditions merit. The assumptions used are inherently uncertain and, as a result, the model cannot precisely measure future net interest income or precisely predict the impact of fluctuations in market interest rates on net interest income. Actual results will differ from the model’s simulated results due to timing, magnitude, and frequency of interest rate changes, as well as changes in market conditions, customer behavior, and the application and timing of various management strategies.

On at least a quarterly basis, we run simulation models to calculate potential impacts to net interest income and the fair value of equity. Specific details of the simulations are reflected in policy as directed by ALCO.

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The following table summarizes the simulated change in net interest income and fair value of equity over a 12-month horizon as of the dates indicated:


	As of September 30, 2026				As of December 31, 2025
Change in Interest Rates (Basis Points)	Percent Change in Net Interest Income		Percent Change in Fair Value of Equity		Percent Change in Net Interest Income		Percent Change in Fair Value of Equity
+300	11.50	%	1.91	%	7.81	%	(3.73	%)
+200	7.84		1.65		5.31		(2.36)
+100	4.02		1.19		2.69		(1.03)
Base	—		—		—		—
-100	(3.77)		(0.35)		(2.62)		0.89
-200	(7.56)		(1.70)		(5.09)		1.23

The results of the simulations are primarily driven by the contractual characteristics of all balance sheet instruments and customer behavior.

Impact of Inflation

Our consolidated financial statements and related notes included elsewhere in this statement have been prepared in accordance with GAAP. These require the measurement of financial position and operating results in terms of historical dollars, without considering changes in the relative value of money over time due to inflation or recession.

Unlike many industrial companies, substantially all of our assets and liabilities are monetary in nature. As a result, interest rates have a more significant impact on our performance than the effects of general levels of inflation. Interest rates may not necessarily move in the same direction or in the same magnitude as the prices of goods and services. However, other operating expenses do reflect general levels of inflation.

Non-GAAP Financial Measures

Our accounting and reporting policies conform to GAAP, and the prevailing practices in the banking industry. However, we also evaluate our performance based on certain additional non-GAAP financial measures. We classify a financial measure as being a non-GAAP financial measure if that financial measure excludes or includes amounts, or is subject to adjustments that have the effect of excluding or including amounts, that are included or excluded, as the case may be, in the most directly comparable measure calculated and presented in accordance with GAAP as in effect from time to time in the United States in our statements of income, balance sheets or statements of cash flows. Non-GAAP financial measures do not include operating and other statistical measures or ratios, or statistical measures calculated using exclusively either financial measures calculated in accordance with GAAP, operating measures or other measures that are not non-GAAP financial measures or both.

This discussion and analysis section includes certain non-GAAP financial measures (e.g., referenced as “core” or “tangible”) intended to supplement, not substitute for, comparable GAAP measures. These measures typically adjust income available to common shareholders for certain significant activities or transactions that in management’s opinion can distort period-to-period comparisons of the Company's performance. Transactions that are typically excluded from non-GAAP measures include realized and unrealized gains/losses on former bank premises and equipment, gains/losses on sales of securities, and acquisition-related expenses (including, but not limited to, legal costs, system conversion costs, severance and retention payments, etc.). The measures also typically adjust goodwill and certain intangible assets from book value and shareholders’ equity.

Management believes presentations of these non-GAAP financial measures provide useful supplemental information that is essential to a proper understanding of the operating results of the Company’s core business. These non-GAAP disclosures are not necessarily comparable to non-GAAP measures that may be presented by other companies. You should understand how such other banking organizations calculate their financial metrics or with names similar to the non-GAAP financial measures we have discussed in this statement when comparing such non-GAAP financial measures.

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Core Net Income. Core net income available to common shareholders, which excludes certain income and expenses, for the three months ended September 30, 2026, was $26.0 million, or $0.79 per diluted common share, compared to core net income available to common shareholders of $21.2 million, or $0.72 per diluted common share, for the three months ended September 30, 2025. Notable noncore events impacting earnings for the three months ended September 30, 2026, included acquisition-related expenses of $3.5 million, compared to noncore events of $2.0 million in employee retention tax credits, offset by $1.2 million in acquisition-related expenses and core conversion expenses of $439,000 for the same period in 2025.

Core net income available to common shareholders, which excludes certain income and expenses, for the nine months ended September 30, 2026, was $73.4 million, or $2.24 per diluted common share, compared to core net income available to common shareholders of $60.0 million, or $2.03 per diluted common share, for the nine months ended September 30, 2025. Notable noncore events impacting earnings for the nine months ended September 30, 2026, included a gain on the redemption of debt of $545,000, offset by acquisition-related expenses of $6.9 million, compared to non core events of a $155,000 gain on sale of former bank premises, $3.4 million gain on the sale of a banking center, $630,000 gain on the extinguishment of debt and $2.0 million in employee retention tax credits, offset by $2.4 million in acquisition-related expenses and core conversion expenses of $1.7 million for the same period in 2025.


	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
(Dollars in thousands, except per share data) (Unaudited)	2026		2025		2026		2025
Interest Income:
Interest income	$	127,517	$	118,688	$	375,661	$	347,231
Core interest income	127,517		118,688		375,661		347,231
Interest Expense:
Interest expense	46,853		49,412		141,958		144,930
Core interest expense	46,853		49,412		141,958		144,930
Provision for Credit Losses:
Provision for credit losses	1,938		3,183		6,207		8,220
Core provision expense	1,938		3,183		6,207		8,220
Other Income:
Other income	12,512		11,671		40,529		39,312
Gains on former bank premises and equipment	—		—		(28)		(155)
Losses (gains) on sale of securities	21		(77)		(53)		(29)
Gain on banking center sale	—		—		—		(3,360)
Gain on extinguishment/redemption of debt	—		—		(545)		(630)
Core other income	12,533		11,594		39,903		35,138
Other Expense:
Other expense	60,465		48,882		177,461		150,666
Acquisition-related expenses (2)	(3,538)		(1,157)		(6,934)		(2,406)
Core conversion expenses	—		(439)		—		(1,663)
Employee retention tax credit	—		1,997		—		1,997
Core other expense	56,927		49,283		170,527		148,594
Pre-Tax Income:
Pre-tax income	30,773		28,882		90,564		82,727

Gains on former bank premises and equipment	—		—		(28)		(155)
Losses (gains) on sale of securities	21		(77)		(53)		(29)
Gain on banking center sale	—		—		—		(3,360)
Gain on extinguishment/redemption of debt	—		—		(545)		(630)
Acquisition-related expenses (2)	3,538		1,157		6,934		2,406
Core conversion expenses	—		439		—		1,663
Employee retention tax credit	—		(1,997)		—		(1,997)
Core pre-tax income	34,332		28,404		96,872		80,625

(CONTINUED)

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	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
(Dollars in thousands, except per share data) (Unaudited)	2026		2025		2026		2025

































Provision for Income Taxes: (1)
Provision for income taxes	6,221		6,026		18,273		17,225

Tax on gains on former bank premises and equipment	—		—		(6)		(33)
Tax on losses (gains) on sale of securities	5		(16)		(11)		(6)
Tax on gain on banking center sale	—		—		—		(833)
Tax on gain on extinguishment/redemption of debt	—		—		(115)		(133)
Tax on acquisition-related expenses (2)	743		157		1,301		403
Tax on core conversion expenses	—		93		—		352
Tax on employee retention tax credit	—		(422)		—		(422)
Core provision for income taxes	6,969		5,838		19,442		16,553
Preferred Dividends
Preferred dividends	1,351		1,351		4,051		4,051
Core preferred dividends	1,351		1,351		4,051		4,051
Net Income Available to Common Shareholders:
Net income available to common shareholders	23,201		21,505		68,240		61,451

Gains on former bank premises and equipment, net of tax	—		—		(22)		(122)
Losses (gains) on sale of securities, net of tax	16		(61)		(42)		(23)
Gain on banking center sale, net of tax	—		—		—		(2,527)
Gain on extinguishment/redemption of debt, net of tax	—		—		(430)		(497)
Acquisition-related expenses (2), net of tax	2,795		1,000		5,633		2,003
Core conversion expenses, net of tax	—		346		—		1,311
Employee retention tax credit, net of tax	—		(1,575)		—		(1,575)
Core net income available to common shareholders	$	26,012	$	21,215	$	73,379	$	60,021
Diluted Earnings Per Common Share:
Diluted earnings per common share	$	0.71	$	0.73	$	2.08	$	2.08
Gains on former bank premises and equipment, net of tax	—		—		—		—
Losses (gains) on sale of securities, net of tax	—		—		—		—
Gain on sale of banking center, net of tax	—		—		—		(0.09)
Gain on extinguishment/redemption of debt, net of tax	—		—		(0.01)		(0.02)
Acquisition-related expenses (2), net of tax	0.08		0.03		0.17		0.07
Core conversion expenses, net of tax	—		0.01		—		0.04
Employee retention tax credit, net of tax	—		(0.05)		—		(0.05)
Core diluted earnings per common share	$	0.79	$	0.72	$	2.24	$	2.03

____________________________

(1)Tax rates, exclusive of certain nondeductible acquisition-related expenses and goodwill, utilized were 21.129% for both 2026 and 2025. These rates approximate the marginal tax rates for the applicable periods.

(2)Includes merger and conversion-related expenses, salary and other incremental merger-related expense.

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Tangible Book Value Per Common Share. Tangible book value per common share is a non-GAAP measure generally used by financial analysts and investment bankers to evaluate financial institutions. We calculate (1) tangible common equity as shareholders’ equity less preferred stock, goodwill, and core deposit and customer intangible assets, net of accumulated amortization, and (2) tangible book value per common share as tangible common equity divided by shares of common stock outstanding. The most directly comparable GAAP financial measure for tangible book value per common share is book value per common share.

The following table reconciles, as of the dates set forth below, total shareholders’ equity to tangible common equity and presents tangible book value per common share compared to book value per common share:


(Dollars in thousands, except per share data) (Unaudited)	As of September 30, 2026		As of December 31, 2025
Tangible Common Equity
Total shareholders' equity	$	1,002,516	$	896,883
Preferred stock	(71,930)		(71,930)
Total common shareholders' equity	930,586		824,953
Adjustments:
Goodwill	(131,743)		(121,146)
Core deposit and customer intangibles	(31,983)		(14,497)
Total tangible common equity	$	766,860	$	689,310
Common shares outstanding (1)	32,345,723		29,510,668
Book value per common share (1)	$	28.77	$	27.95
Tangible book value per common share (1)	23.71		23.36

____________________________

(1)Excludes the dilutive effect, if any, of 208,611 and 149,240 shares of common stock issuable upon exercise of outstanding stock options and restricted stock awards as of September 30, 2026 and December 31, 2025, respectively.

Tangible Common Equity to Tangible Assets. Tangible common equity to tangible assets is a non-GAAP measure generally used by financial analysts and investment bankers to evaluate financial institutions. We calculate tangible common equity, as described above, and tangible assets as total assets less goodwill, core deposit and customer intangible assets, net of accumulated amortization. The most directly comparable GAAP financial measure for tangible common equity to tangible assets is total common shareholders’ equity to total assets.

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The following table reconciles, as of the dates set forth below, total shareholders’ equity to tangible common equity and total assets to tangible assets:


(Dollars in thousands, except per share data) (Unaudited)	As of September 30, 2026			As of December 31, 2025
Tangible Common Equity
Total shareholders' equity	$	1,002,516		$	896,883
Preferred stock	(71,930)			(71,930)
Total common shareholders' equity	930,586			824,953
Adjustments:
Goodwill	(131,743)			(121,146)
Core deposit and customer intangibles	(31,983)			(14,497)
Total tangible common equity	$	766,860		$	689,310
Tangible Assets
Total Assets	$	8,955,962		$	8,214,740
Adjustments:
Goodwill	(131,743)			(121,146)
Core deposit and customer intangibles	(31,983)			(14,497)
Total tangible assets	$	8,792,236		$	8,079,097
Common Equity to Total Assets	10.39		%	10.04		%
Tangible Common Equity to Tangible Assets	8.72			8.53

Item 3. Quantitative and Qualitative Disclosures about Market Risk

Risk identification and management are essential elements for the successful management of our business. In the normal course of business, we are subject to various types of risk, including interest rate, credit, and liquidity risk. We control and monitor these risks with policies, procedures, and various levels of managerial and board oversight. Our objective is to optimize profitability while managing and controlling risk within board approved policy limits. Interest rate risk is the sensitivity of net interest income and the market value of financial instruments to the magnitude, direction, and frequency of changes in interest rates. Interest rate risk results from various repricing frequencies and the maturity structure of assets and liabilities. We use our asset liability management policy to control and manage interest rate risk. See Item 2. “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Interest Rate Sensitivity and Market Risk” for additional discussion of interest rate risk.

Liquidity risk represents the inability to generate cash or otherwise obtain funds at reasonable rates to satisfy commitments to borrowers, as well as the obligations to depositors. We use our asset liability management policy and contingency funding plan to control and manage liquidity risk.

Credit risk represents the possibility that a customer may not perform in accordance with contractual terms. Credit risk results from extending credit to customers, purchasing securities, and entering into certain off-balance sheet loan funding commitments. Our primary credit risk is directly related to our loan portfolio. We use our credit policy and disciplined approach to evaluate the adequacy of our allowance for credit losses to control and manage credit risk. Our investment policy limits the degree of the amount of credit risk that we may assume in our investment portfolio. Our principal financial market risks are liquidity risks and exposures to interest rate movements.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Under the supervision and with the participation of our principal executive officer and principal financial officer, we have evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a – 15(e) and 15d – 15(e) under the Securities Exchange Act of 1934, as amended) as of the end of the period covered by this Report. Based on such evaluation, our principal executive officer and principal financial officer concluded that our disclosure controls and

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procedures were effective as of the end of the period covered by this Report to provide reasonable assurance that the information we are required to disclose in reports that are filed or furnished under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the SEC, including to ensure that such information is accumulated and communicated to management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure. The effectiveness of our, or any, system of disclosure controls and procedures is subject to certain limitations, including the exercise of judgment in designing, implementing and evaluating the controls and procedures, the assumptions used in identifying the likelihood of future events, and the inability to eliminate misconduct completely. As a result, we cannot assure you that our disclosure controls and procedures will detect all errors or fraud.

Changes in Internal Controls over Financial Reporting

There were no changes in our internal control over financial reporting during the period covered by this Report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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PART II. OTHER INFORMATION

Item 1. Legal Proceedings

From time to time, we are a party to claims and legal proceedings arising in the ordinary course of business. Management evaluates our exposure to these claims and proceedings individually, and in the aggregate, and provides for potential losses on such litigation if the amount of the loss is estimable and the loss is probable. We are not currently involved in any pending legal proceedings other than routine, nonmaterial proceedings occurring in the ordinary course of business.

Item 1A. Risk Factors

In addition to the other information set forth in this Report, we refer you to Item 1A. “Risk Factors” of our Annual Report on Form 10-K for the year ended December 31, 2025, filed with the SEC. There have been no material changes in the risk factors disclosed in our Annual Report on Form 10-K for December 31, 2025.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

On October 28, 2025, our board of directors approved a stock repurchase program authorizing Business First to repurchase shares of its common stock having an aggregate purchase price of up to $30.0 million from time to time, subject to applicable limitations and conditions. The program became effective immediately and was scheduled to continue until October 28, 2027, unless completed, terminated or superseded earlier. The program did not obligate Business First to repurchase any shares of its common stock.

Business First repurchased 204,160 shares of its common stock for an aggregate purchase price of approximately $6.3 million under the 2025 stock repurchase program between July 1, 2026, and September 30, 2026. As of September 30, 2026, approximately $12.4 million remained available for repurchases under that program.

Our board of directors approved a new stock repurchase program authorizing Business First to repurchase shares of its common stock having an aggregate purchase price of up to $30.0 million. The new program became effective on October 29, 2026, and replaced and superseded the 2025 stock repurchase program. Accordingly, upon the effectiveness of the new program, the approximately $12.4 million of unused repurchase authority remaining under the 2025 program was terminated and is no longer available.

The new stock repurchase program will continue until October 28, 2028, unless completed, suspended or terminated earlier. The new program does not obligate Business First to repurchase any particular number of shares or any shares at all. The timing and amount of any repurchases will depend on market conditions, applicable legal requirements and other considerations.

The following table presents information concerning purchases of Business First common stock during the three months ended September 30, 2026:


Period	Total number of shares purchased	Average price paid per share		Total number of shares purchased as part of publicly announced plans or programs	Approximate dollar value of shares that may yet be purchased under the plan (in thousands)




July 1 through July 31, 2026	—	—		—	18,706
August 1 through August 31, 2026	35,050	31.02		35,050	17,619
September 1 through September 30, 2026	169,110	30.76		169,110	12,416
Total	204,160	$	30.81	204,160	$	12,416

Item 3. Defaults upon Senior Securities

Not applicable.

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Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

(a)Not applicable.

(b)Not applicable.

(c)During the three months ended September 30, 2026, no director or officer of the Company adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 arrangement,” as each term is defined in Item 408(a) of Regulation S-K.

Item 6. Exhibits


Number			Description

2.1			Agreement and Plan of Reorganization, dated July 7, 2025, by and between Business First Bancshares, Inc., and Progressive Bancorp, Inc. (incorporated by reference to Exhibit 2.1 to the Current Report on Form 8-K filed by Business First Bancshares, Inc. on July 7, 2025).

3.1			Restated Articles of Incorporation of Business First Bancshares, Inc., adopted October 27, 2022 (incorporated by reference to Exhibit 3.1 of the Quarterly Report on Form 10-Q for the quarter ended September 30, 2022, filed by Business First Bancshares, Inc. on November 3, 2022).

3.2			Amended and Restated Bylaws of Business First Bancshares, Inc., adopted April 23, 2020 (incorporated by reference to Exhibit 3.2 to the Current Report on Form 8-K filed by Business First Bancshares, Inc. on April 28, 2020).

4.1			Specimen Common Stock Certificate (incorporated by reference to Exhibit 4.1 to the Registration Statement on Form S-4 filed by Business First Bancshares, Inc. on November 12, 2014).

4.2			Form of Series A Preferred Stock (incorporated by reference to Exhibit A to Exhibit 10.1 to the Current Report on Form 8-K filed by Business First Bancshares, Inc. on September 1, 2022).

10.1			Form of Subordinated Note Purchase Agreement dated April 2, 2026 by and among Business First Bancshares, Inc. and the Purchasers named therein (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed by Business First Bancshares, Inc. on April 2, 2026).

31.1			Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002*

31.2			Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002*

32.1			Certifications of Principal Executive Officer and Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002**

101.INS			Inline XBRL Instance Document*

101.SCH			Inline XBRL Taxonomy Extension Schema Document*

101.CAL			Inline XBRL Taxonomy Extension Calculation Linkbase Document*

101.DEF			Inline XBRL Taxonomy Extension Definition Linkbase Document*

101.LAB			Inline XBRL Taxonomy Extension Label Linkbase Document*

101.PRE			Inline XBRL Taxonomy Extension Presentation Linkbase Document*

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104			Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

____________

*Filed herewith.

** This exhibit is furnished herewith and shall not be deemed "filed" for purposes of Section 18 of the Exchange Act, or otherwise subject to the liability of that section, and shall not be deemed to be incorporated by reference into any filing under the Securities Act or the Exchange Act.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant hereby duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized.


			BUSINESS FIRST BANCSHARES, INC.

November 3, 2026			/s/ David R. Melville, III
			David R. Melville, III
			Chairman, President and Chief Executive Officer

November 3, 2026			/s/ Gregory Robertson
			Gregory Robertson
			Chief Financial Officer