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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
Form 10-Q
 
☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 
For the quarterly period ended September 30, 2025

or

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT

For the transition period from __________ to __________

Commission File Number: 001-37621

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FIRST GUARANTY BANCSHARES, INC.
(Exact name of registrant as specified in its charter)
 
Louisiana 26-0513559
(State or other jurisdiction incorporation or organization) (I.R.S. Employer Identification Number)
   
400 East Thomas Street  
Hammond, Louisiana 70401
(Address of principal executive offices) (Zip Code)
   
(985) 345-7685
(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, $1 par value FGBI The Nasdaq Stock Market LLC
Depository Shares (each representing a 1/40th interest in a share of 6.75% Series A Fixed-Rate Non-Cumulative perpetual preferred stock) FGBIP The Nasdaq Stock Market LLC

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 ☒ No ☐
 
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 during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filers," "accelerated filers," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.
Large accelerated filer ☐     Accelerated filer ☒   Non-accelerated filer ☐
Smaller reporting company ☒
Emerging growth company ☐



If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.   ☐
 
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes ☐ No ☒

As of October 31, 2025 the registrant had 15,352,947 shares of $1 par value common stock outstanding.



Table of Contents
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-3-

PART I. FINANCIAL INFORMATION
Item 1.     Consolidated Financial Statements
FIRST GUARANTY BANCSHARES, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS (unaudited) 
(in thousands, except share data) September 30, 2025 December 31, 2024
Assets    
Cash and cash equivalents:    
Cash and due from banks $ 753,629  $ 563,778 
Federal funds sold 554  430 
Cash and cash equivalents 754,183  564,208 
Interest-earning time deposits with banks 250  250 
Investment securities:    
Available for sale, at fair value (cost of $372,873 and $284,321, respectively)
 374,335  281,097 
Held to maturity, at cost and net of allowance for credit losses of $150 (estimated fair value of $264,566 and $251,458, respectively)
 322,413  321,622 
Investment securities 696,748  602,719 
Federal Home Loan Bank stock, at cost 10,079  9,706 
Loans, net of unearned income 2,279,741  2,693,780 
Less: allowance for credit losses 85,713  34,811 
Net loans 2,194,028  2,658,969 
Premises and equipment, net 59,979  67,789 
Goodwill —  12,900 
Intangible assets, net 2,847  3,474 
Other real estate, net 12,050  319 
Accrued interest receivable 14,776  14,850 
Other assets 52,396  37,544 
Total Assets $ 3,797,336  $ 3,972,728 
Liabilities and Shareholders' Equity    
Deposits:    
Noninterest-bearing demand $ 396,906  $ 404,056 
Interest-bearing demand 1,390,219  1,387,068 
Savings 215,077  234,444 
Time 1,352,695  1,450,692 
Total deposits 3,354,897  3,476,260 
Repurchase agreements 7,117  7,009 
Accrued interest payable 16,333  20,437 
Long-term advances from Federal Home Loan Bank 135,000  135,000 
Senior long-term debt 14,196  15,169 
Junior subordinated debentures 29,790  44,745 
Other liabilities 18,928  19,059 
Total Liabilities 3,576,261  3,717,679 
Shareholders' Equity    
Preferred stock, Series A - $1,000 par value - 100,000 shares authorized
    
   Non-cumulative perpetual; 34,500 shares issued and outstanding
 33,058  33,058 
Common stock, $1 par value - 100,600,000 shares authorized; 15,352,947 and 12,504,717 shares issued and outstanding
 15,353  12,505 
Surplus 168,682  149,389 
Retained earnings 12,342  72,965 
Accumulated other comprehensive (loss) income (8,360) (12,868)
Total Shareholders' Equity 221,075  255,049 
Total Liabilities and Shareholders' Equity $ 3,797,336  $ 3,972,728 
See Notes to Consolidated Financial Statements



-4-

FIRST GUARANTY BANCSHARES, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF INCOME (unaudited) 

  Three Months Ended September 30,
Nine Months Ended September 30,
(in thousands, except share data) 2025 2024 2025 2024
Interest Income:    
Loans (including fees) $ 39,325  $ 49,811  $ 123,307  $ 144,281 
Deposits with other banks 7,777  4,645  21,287  11,747 
Securities (including FHLB stock) 6,398  2,971  17,690  7,958 
Total Interest Income 53,500  57,427  162,284  163,986 
Interest Expense:    
Demand deposits 13,185  16,957  38,097  50,992 
Savings deposits 1,058  1,374  3,656  3,928 
Time deposits 14,519  12,631  45,605  32,649 
Borrowings 2,500  3,767  8,225  10,556 
Total Interest Expense 31,262  34,729  95,583  98,125 
Net Interest Income 22,238  22,698  66,701  65,861 
Less: Provision for credit losses 47,933  4,904  79,091  14,013 
Net Interest Income (Loss) after Provision for Credit Losses (25,695) 17,794  (12,390) 51,848 
Noninterest Income:    
Service charges, commissions and fees 832  815  2,515  2,343 
ATM and debit card fees 741  784  2,266  2,352 
Net gains on securities —  —  —  — 
Net gains on sale of loans —  1,471  —  1,481 
Net (losses) gains on sale of assets (366) 31  (362) 13,244 
Other 653  1,304  1,951  2,819 
Total Noninterest Income 1,860  4,405  6,370  22,239 
Noninterest Expense:    
Salaries and employee benefits 7,465  10,098  23,749  30,438 
Occupancy and equipment expense 2,605  2,538  7,850  7,356 
Goodwill impairment 12,900  —  12,900  — 
Other 7,205  7,070  20,960  21,455 
Total Noninterest Expense 30,175  19,706  65,459  59,249 
(Loss) Income Before Income Taxes (54,010) 2,493  (71,479) 14,838 
Less: (Benefit) provision for income taxes (9,007) 566  (13,007) 3,400 
Net (Loss) Income (45,003) 1,927  (58,472) 11,438 
Less: Preferred stock dividends 582  582  1,746  1,747 
Net (Loss) Income Available to Common Shareholders $ (45,585) $ 1,345  $ (60,218) $ 9,691 
Per Common Share:
   
(Loss) Earnings $ (3.01) $ 0.11  $ (4.45) $ 0.78 
Cash dividends paid $ 0.01  $ 0.08  $ 0.03  $ 0.40 
Weighted Average Common Shares Outstanding 15,122,702  12,504,717  13,523,009  12,499,799 
See Notes to Consolidated Financial Statements





-5-

FIRST GUARANTY BANCSHARES, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (unaudited)

  Three Months Ended September 30,
Nine Months Ended September 30,
(in thousands) 2025 2024 2025 2024
Net (Loss) Income $ (45,003) $ 1,927  $ (58,472) $ 11,438 
Other comprehensive income:    
Unrealized (losses) gains on securities:    
Unrealized holding gains arising during the period 2,341  1,148  5,707  2,204 
Change in unrealized gains on securities 2,341  1,148  5,707  2,204 
Tax impact (492) (241) (1,199) (463)
Other comprehensive income 1,849  907  4,508  1,741 
Comprehensive (Loss) Income $ (43,154) $ 2,834  $ (53,964) $ 13,179 
See Notes to Consolidated Financial Statements
 
-6-

FIRST GUARANTY BANCSHARES, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (unaudited) 
 
Preferred Stock $1,000 Par
Common Stock
$1 Par
 Surplus Retained
Earnings		 Accumulated
Other Comprehensive
Income/(Loss)		 Total
(in thousands, except per share data)
          
Balance December 31, 2023 $ 33,058  $ 12,475  $ 149,085  $ 67,972  $ (12,959) $ 249,631 
Net income —  —  —  2,310  —  2,310 
Common Stock issued under Equity Bonus Plan, 29,293 shares
 —  30  304  —  —  334 
Other comprehensive income —  —  —  —  628  628 
Preferred stock dividends —  —  —  (582) —  (582)
Cash dividends on common stock ($0.16 per share)
 —  —  —  (2,001) —  (2,001)
Balance March 31, 2024 (unaudited) $ 33,058  $ 12,505  $ 149,389  $ 67,699  $ (12,331) $ 250,320 
Net income —  —  —  7,201  —  7,201 
Other comprehensive income —  —  —  206  206 
Preferred stock dividends —  —  —  (582) —  (582)
Cash dividends on common stock ($0.16 per share)
 —  —  —  (2,001) —  (2,001)
Balance June 30, 2024 (unaudited) $ 33,058  $ 12,505  $ 149,389  $ 72,317  $ (12,125) $ 255,144 
Net income —  —  —  1,927  —  1,927 
Other comprehensive income —  —  —  —  907  907 
Preferred stock dividends —  —  —  (582) —  (582)
Cash dividends on common stock ($0.08 per share)
 —  —  —  (1,000) —  (1,000)
Balance September 30, 2024 (unaudited) $ 33,058  $ 12,505  $ 149,389  $ 72,662  $ (11,218) $ 256,396 
-7-

Balance December 31, 2024 $ 33,058  $ 12,505  $ 149,389  $ 72,965  $ (12,868) $ 255,049 
Net (loss) income —  —  —  (6,166) —  (6,166)
Common Stock issued in private placement, 186,787 shares
 —  186  1,395  —  —  1,581 
Other comprehensive income —  —  —  —  1,688  1,688 
Preferred stock dividends —  —  —  (582) —  (582)
Cash dividends on common stock ($0.01 per share)
 —  —  —  (125) —  (125)
Balance March 31, 2025 (unaudited) $ 33,058  $ 12,691  $ 150,784  $ 66,092  $ (11,180) $ 251,445 
Net (loss) income —  —  —  (7,303) —  (7,303)
Common Stock issued in private placement, 358,680 shares
 —  359  2,619  —  —  2,978 
Common Stock issued in subordinated debt conversion, 1,981,506 shares
 —  1,982  13,018  —  —  15,000 
Common Stock issued as payment-in-kind, 88,482 shares
—  88  620  —  —  708 
Other comprehensive income —  —  —  —  971  971 
Preferred stock dividends —  —  —  (582) —  (582)
Cash dividends on common stock ($0.01 per share)
 —  —  —  (129) —  (129)
Balance June 30, 2025 (unaudited) $ 33,058  $ 15,120  $ 167,041  $ 58,078  $ (10,209) $ 263,088 
Net (loss) income —  —  —  (45,003) —  (45,003)
Common Stock issued in private placement, 122,503 shares
 —  123  864  —  —  987 
Common Stock issued as payment-in-kind, 110,272 shares
 —  110  777  —  —  887 
Other comprehensive income —  —  —  —  1,849  1,849 
Preferred stock dividends —  —  —  (582) —  (582)
Cash dividends on common stock ($0.01 per share)
 —  —  —  (151) —  (151)
Balance September 30, 2025 (unaudited) $ 33,058  $ 15,353  $ 168,682  $ 12,342  $ (8,360) $ 221,075 
See Notes to Consolidated Financial Statements
-8-

FIRST GUARANTY BANCSHARES, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)
-9-

  Nine Months Ended September 30,
(in thousands) 2025 2024
Cash Flows From Operating Activities    
Net (loss) income $ (58,472) $ 11,438 
Adjustments to reconcile net (loss) income to net cash provided by operating activities:    
Provision for credit losses 79,091  14,013 
Goodwill impairment 12,900  — 
Depreciation and amortization 3,257  3,227 
Change in right of use asset 379  155 
Amortization/Accretion of investments (2,686) 13 
(Gain) loss on sale/call of securities —  — 
Loss (gain) on sale of assets 362  (14,725)
Repossessed asset write downs, gains and losses on dispositions 24  383 
Interest expense paid-in-kind 1,595  — 
FHLB stock dividends (373) (561)
Change in operating lease liabilities (352) (146)
Change in other assets and liabilities, net (19,228) 952 
Net Cash Provided By Operating Activities 16,497  14,749 
Cash Flows From Investing Activities    
Proceeds from maturities, calls and sales of AFS securities 184,045  52,211 
Funds invested in certificates of deposit —  (250)
Funds invested in AFS securities (269,682) (309,922)
Funds invested in Federal Home Loan Bank stock —  (4,265)
Proceeds from sale/redemption of Federal Home Loan Bank stock —  8,724 
Net decrease (increase) in loans 377,772  (34,324)
Purchase of premises and equipment (1,169) (2,754)
Proceeds from sales of premises and equipment 1,238  14,901 
Proceeds from sales of other real estate owned 142  318 
Net Cash Provided By (Used In) Investing Activities 292,346  (275,361)
Cash Flows From Financing Activities    
Net (decrease) increase in deposits (121,363) 420,831 
Net increase (decrease) in federal funds purchased and short-term borrowings 108  (59,316)
Repayment of long-term borrowings (1,008) (43,023)
Proceeds from subordinated debentures —  29,700 
Proceeds from issuance of common stock 5,546  334 
Dividends paid on preferred stock (1,746) (1,747)
Dividends paid on common stock (405) (5,001)
Net Cash (Used In) Provided By Financing Activities (118,868) 341,778 
Net Increase In Cash and Cash Equivalents 189,975  81,166 
Cash and Cash Equivalents at the Beginning of the Period 564,208  286,455 
Cash and Cash Equivalents at the End of the Period $ 754,183  $ 367,621 
Noncash Activities:    
Acquisition of real estate in settlement of loans $ 7,568  $ 423 
Premises transferred to other real estate owned $ 4,352  $ — 
Common stock issued for debt conversion $ 15,000  $ — 
Common stock issued for payment-in-kind $ 1,595  $ — 
Cash Paid During The Period:    
Interest on deposits and borrowed funds $ 99,687  $ 92,182 
Federal income taxes $ 4,100  $ — 
State income taxes $ —  $ — 
 See Notes to the Consolidated Financial Statements.
-10-

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 1. Basis of Presentation
 
The accompanying unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles. The consolidated financial statements and the footnotes of First Guaranty Bancshares, Inc. ("First Guaranty") thereto should be read in conjunction with the audited consolidated financial statements and note disclosures for First Guaranty previously filed with the Securities and Exchange Commission in First Guaranty's Annual Report on Form 10-K for the year ended December 31, 2024.
 
The consolidated financial statements include the accounts of First Guaranty Bancshares, Inc. and its wholly owned subsidiary First Guaranty Bank (the "Bank"). All significant intercompany balances and transactions have been eliminated in consolidation.
 
In the opinion of management, the accompanying unaudited consolidated financial statements contain all adjustments necessary for a fair presentation of the consolidated financial statements. Those adjustments are of a normal recurring nature. The results of operations at September 30, 2025 and for the three and nine month periods ended September 30, 2025 and 2024 are not necessarily indicative of the results expected for the full year or any other interim period. The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates. Material estimates that are particularly susceptible to significant change in the near-term relate to the determination of the allowance for credit losses, the valuation of real estate acquired in connection with foreclosures or in satisfaction of loans, and the valuation of investment securities.
-11-

Note 2. Recent Accounting Pronouncements

Accounting Standards Adopted in 2025

None.

Accounting Pronouncements Not Yet Adopted

ASU No. 2023-09, "Improvements to Tax Disclosures" ("ASU 2023-09") is intended to enhance the transparency and decision usefulness of income tax disclosures primarily through changes to the rate reconciliation and income taxes paid information. This update is effective for annual periods beginning after December 15, 2024, though early adoption is permitted. While we anticipate that the adoption of this standard will require additional disclosures, we do not expect it to have a material effect on First Guaranty's consolidated financial statements.

ASU 2024-03, "Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures" (ASU 2024-03") requires the disaggregation of certain expenses in the notes to the financial statements, to provide enhanced transparency into the expense captions presented on the face of the income statement. The amendments in ASU 2024-03 are effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Early adoption is permitted. The amendments in this ASU may be applied either prospectively or retrospectively. The Company is currently evaluating the impact that this update will have on its disclosures in the consolidated financial statements.





-12-

Note 3. Securities
 
A summary comparison of securities by type at September 30, 2025 and December 31, 2024 is shown below. 

  September 30, 2025 December 31, 2024
(in thousands) Amortized Cost Gross
Unrealized Gains		 Gross
Unrealized Losses		 Fair Value Amortized Cost Gross Unrealized Gains Gross
Unrealized Losses		 Fair Value
Available for sale:                
U.S. Treasuries $ —  $ —  $ —  $ —  $ 147,840  $ 33  $ (93) $ 147,780 
U.S. Government Agencies —  —  —  —  —  —  —  — 
Corporate debt securities 8,300  —  (245) 8,055  12,250  —  (668) 11,582 
Municipal bonds 17,723  190  (460) 17,453  21,736  220  (339) 21,617 
Collateralized mortgage obligations 136,305  824  (101) 137,028  32,065  —  (446) 31,619 
Mortgage-backed securities 210,545  1,637  (383) 211,799  70,430  —  (1,931) 68,499 
Total available for sale securities $ 372,873  $ 2,651  $ (1,189) $ 374,335  $ 284,321  $ 253  $ (3,477) $ 281,097 
Held to maturity:                
U.S. Government Agencies $ 267,410  $ —  $ (54,569) $ 212,841  $ 266,761  $ —  $ (64,671) $ 202,090 
Corporate debt securities 55,153  6  (3,434) 51,725  55,011  —  (5,643) 49,368 
Total held to maturity securities $ 322,563  $ 6  $ (58,003) $ 264,566  $ 321,772  $ —  $ (70,314) $ 251,458 
 
The scheduled maturities of securities at September 30, 2025, by contractual maturity, are shown below. Actual maturities may differ from contractual maturities due to calls or prepayments. Mortgage-backed securities are not due at a single maturity because of amortization and potential prepayment of the underlying mortgages. For this reason, they are presented separately in the maturity table below:  
  At September 30, 2025
(in thousands) Amortized Cost Fair Value
Available for sale:    
Due in one year or less $ 3,564  $ 3,572 
Due after one year through five years 6,860  6,930 
Due after five years through 10 years 13,394  13,022 
Over 10 years 2,205  1,984 
Subtotal 26,023  25,508 
Collateralized mortgage obligations 136,305  137,028 
Mortgage-backed securities 210,545  211,799 
Total available for sale securities $ 372,873  $ 374,335 
Held to maturity:    
Due in one year or less $ —  $ — 
Due after one year through five years 23,612  22,532 
Due after five years through 10 years 118,949  106,441 
Over 10 years 180,002  135,593 
Total held to maturity securities $ 322,563  $ 264,566 
 
At September 30, 2025, $512.5 million of First Guaranty's securities were pledged to secure public funds deposits and borrowings. The pledged securities had a market value of $463.6 million as of September 30, 2025.

Accrued interest receivable on First Guaranty's investment securities was $3.5 million and $1.4 million at September 30, 2025 and December 31, 2024, respectively, and was included in accrued interest receivable on the consolidated balance sheet. First Guaranty had a $0.2 million allowance for credit losses related to the held to maturity portfolio at September 30, 2025 and December 31, 2024.
-13-


The following is a summary of the fair value of securities with gross unrealized losses and an aging of those gross unrealized losses at September 30, 2025.

    At September 30, 2025  
  Less Than 12 Months 12 Months or More Total
(in thousands) Number
of Securities		 Fair Value Gross
Unrealized
Losses		 Number
of Securities		 Fair Value Gross
Unrealized
Losses		 Number
of Securities		 Fair Value Gross
Unrealized Losses
Available for sale:                  
U.S. Treasuries —  $ —  $ —  —  $ —  $ —  —  $ —  $ — 
Corporate debt securities 2  1,484  (16) 8  6,571  (229) 10  8,055  (245)
Municipal bonds 3  1,350  (40) 26  5,135  (420) 29  6,485  (460)
Collateralized mortgage obligations 9  42,883  (101) —  —  —  9  42,883  (101)
Mortgage-backed securities 2  6,822  (14) 14  34,715  (369) 16  41,537  (383)
Total available for sale securities 16  $ 52,539  $ (171) 48  $ 46,421  $ (1,018) 64  $ 98,960  $ (1,189)
Held to maturity:                  
U.S. Government Agencies —  $ —  $ —  29  $ 212,841  $ (54,569) 29  $ 212,841  $ (54,569)
Corporate debt securities 1  897  (73) 55  50,502  (3,361) 56  51,399  (3,434)
Total held to maturity securities 1  $ 897  $ (73) 84  $ 263,343  $ (57,930) 85  $ 264,240  $ (58,003)

The following is a summary of the fair value of securities with gross unrealized losses and an aging of those gross unrealized losses at December 31, 2024. 

    At December 31, 2024  
  Less Than 12 Months 12 Months or More Total
(in thousands) Number
of Securities		 Fair Value Gross
Unrealized
Losses		 Number
of Securities		 Fair Value Gross
Unrealized Losses		 Number
of Securities		 Fair Value Gross
Unrealized Losses
Available for sale:                  
U.S. Treasuries 2  $ 48,615  $ (93) —  $ —  $ —  2  $ 48,615  $ (93)
U.S. Government Agencies —  —  —  —  —  —  —  —  — 
Corporate debt securities 2  1,965  (35) 12  9,617  (633) 14  11,582  (668)
Municipal bonds 2  505  (4) 34  5,406  (335) 36  5,911  (339)
Collateralized mortgage obligations 8  31,619  (446) —  —  —  8  31,619  (446)
Mortgage-backed securities 15  65,089  (1,721) 6  3,410  (210) 21  68,499  (1,931)
Total available for sale securities 29  $ 147,793  $ (2,299) 52  $ 18,433  $ (1,178) 81  $ 166,226  $ (3,477)
Held to maturity:
U.S. Government Agencies —  $ —  $ —  29  $ 202,090  $ (64,671) 29  $ 202,090  $ (64,671)
Corporate debt securities 1  322  (3) 56  49,046  (5,640) 57  49,368  (5,643)
Total held to maturity securities 1  $ 322  $ (3) 85  $ 251,136  $ (70,311) 86  $ 251,458  $ (70,314)

As of September 30, 2025, 149 of First Guaranty's debt securities had unrealized losses totaling 14.0% of the individual securities' amortized cost basis and 8.5% of First Guaranty's total amortized cost basis of the investment securities portfolio. 132 of the 149 securities had been in a continuous loss position for over 12 months at such date. The 132 securities had an aggregate amortized cost basis of $368.7 million and an unrealized loss of $58.9 million at September 30, 2025. Management has the intent and ability to hold these debt securities until maturity or until anticipated recovery.

-14-


Securities are evaluated for impairment from credit losses at least quarterly and more frequently when economic or market conditions warrant such evaluation. Consideration is given to (i) the extent to which the fair value has been less than cost, (ii) the financial condition and near-term prospects of the issuer, (iii) the recovery of contractual principal and interest and (iv) the intent and ability of First Guaranty to retain its investment in the issuer for a period of time sufficient to allow for any anticipated recovery in fair value.
 
Investment securities issued by the U.S. Government and Government sponsored enterprises with unrealized losses and the amount of unrealized losses on those investment securities that are the result of changes in market interest rates will not be credit impaired. First Guaranty has the ability and intent to hold these securities until recovery, which may not be until maturity.
 
Corporate debt securities in a loss position consist primarily of corporate bonds issued by businesses in the financial, insurance, utility, manufacturing, industrial, consumer products and oil and gas industries. There were no held to maturity corporate securities with a credit related impairment loss at September 30, 2025. First Guaranty believes that the remaining issuers will be able to fulfill the obligations of these securities based on evaluations described above. First Guaranty has the ability and intent to hold these securities until they recover, which could be at their maturity dates.

There were no charge-offs recognized on securities during the nine months ended September 30, 2025 and 2024. There were no provisions for credit losses recognized on securities during the nine months ended September 30, 2025 and 2024.

For securities that have indications of credit related impairment, management analyzes future expected cash flows to determine if any credit related impairment is evident. Estimated cash flows are determined using management's best estimate of future cash flows based on specific assumptions. The assumptions used to determine the cash flows were based on estimates of loss severity and credit default probabilities. Management reviews reports from credit rating agencies and public filings of issuers. 
 
At September 30, 2025, First Guaranty's exposure to bond issuers that exceeded 10% of shareholders' equity is below: 

  At September 30, 2025
(in thousands) Amortized Cost Fair Value
U.S. Government Treasuries (U.S.) $ —  $ — 
Federal Home Loan Bank (FHLB) 32,381  27,130 
Federal Home Loan Mortgage Corporation (Freddie Mac-FHLMC) 101,934  76,483 
Federal Farm Credit Bank (FFCB) 139,592  115,615 
Government National Mortgage Association (Ginnie Mae-GNMA) 201,795  203,136 
Total $ 475,702  $ 422,364 

-15-

Note 4. Loans
 
The following table summarizes the components of First Guaranty's loan portfolio as of September 30, 2025 and December 31, 2024: 

  September 30, 2025 December 31, 2024
(in thousands except for %) Balance As % of Category Balance As % of Category
Real Estate:        
Construction & land development $ 231,156  10.1  % $ 330,048  12.2  %
Farmland 31,685  1.4  % 35,991  1.3  %
1- 4 Family 441,017  19.3  % 450,371  16.7  %
Multifamily 137,582  6.0  % 165,121  6.1  %
Non-farm non-residential 1,003,198  43.9  % 1,159,842  42.9  %
Total Real Estate 1,844,638  80.7  % 2,141,373  79.2  %
Non-Real Estate:        
Agricultural 44,737  2.0  % 40,722  1.5  %
Commercial and industrial 227,077  9.9  % 257,518  9.5  %
Commercial leases 134,958  5.9  % 220,200  8.2  %
Consumer and other 34,763  1.5  % 42,267  1.6  %
Total Non-Real Estate 441,535  19.3  % 560,707  20.8  %
Total Loans Before Unearned Income 2,286,173  100.0  % 2,702,080  100.0  %
Unearned income (6,432)   (8,300)  
Total Loans Net of Unearned Income $ 2,279,741    $ 2,693,780   

Accrued interest receivable on First Guaranty's loans totaled $11.3 million and $13.4 million at September 30, 2025 and December 31, 2024, respectively, and is included in accrued interest receivable on the consolidated balance sheet. Accrued interest receivable is excluded from First Guaranty's estimate of the allowance for credit losses.

The following table summarizes fixed and floating rate loans by contractual maturity, excluding nonaccrual loans, as of September 30, 2025 and December 31, 2024 unadjusted for scheduled principal payments, prepayments, or repricing opportunities. The average life of the loan portfolio may be substantially less than the contractual terms when these adjustments are considered. 

  September 30, 2025 December 31, 2024
(in thousands) Fixed Floating Total Fixed Floating Total
One year or less $ 277,638  $ 240,218  $ 517,856  $ 240,685  $ 245,272  $ 485,957 
More than one to five years 273,194  163,476  436,670  501,800  256,720  758,520 
More than five to 15 years 56,158  251,824  307,982  62,412  293,173  355,585 
Over 15 years 340,514  568,886  909,400  358,727  634,762  993,489 
Subtotal $ 947,504  $ 1,224,404  2,171,908  $ 1,163,624  $ 1,429,927  2,593,551 
Nonaccrual loans     114,265      108,529 
Total Loans Before Unearned Income     2,286,173      2,702,080 
Unearned income     (6,432)     (8,300)
Total Loans Net of Unearned Income     $ 2,279,741      $ 2,693,780 
 
Included in floating rate loans are loans that adjust to a floating rate following an initial fixed rate period. The initial fixed rate periods are typically one, three, or five years.
-16-


The following tables present the age analysis of past due loans at September 30, 2025 and December 31, 2024: 

  As of September 30, 2025
(in thousands) 30-89 Days Past Due 90 Days or Greater Total Past Due Current Total Loans Recorded Investment
90 Days Accruing
Real Estate:            
Construction & land development $ 44  $ 8,707  $ 8,751  $ 222,405  $ 231,156  $ — 
Farmland 4,284  2,777  7,061  24,624  31,685  — 
1- 4 family 2,859  10,536  13,395  427,622  441,017  — 
Multifamily —  23,998  23,998  113,584  137,582  — 
Non-farm non-residential 12,879  42,532  55,411  947,787  1,003,198  — 
Total Real Estate 20,066  88,550  108,616  1,736,022  1,844,638  — 
Non-Real Estate:            
Agricultural 32  1,886  1,918  42,819  44,737  — 
Commercial and industrial 555  5,339  5,894  221,183  227,077  — 
Commercial leases —  18,358  18,358  116,600  134,958  — 
Consumer and other 514  132  646  34,117  34,763  — 
Total Non-Real Estate 1,101  25,715  26,816  414,719  441,535  — 
Total Loans Before Unearned Income $ 21,167  $ 114,265  $ 135,432  $ 2,150,741  $ 2,286,173  $ — 
Unearned income         (6,432)  
Total Loans Net of Unearned Income         $ 2,279,741   
 
  As of December 31, 2024
(in thousands) 30-89 Days Past Due 90 Days or Greater Total Past Due Current Total Loans Recorded Investment
90 Days Accruing
Real Estate:            
Construction & land development $ 1,562  $ 11,018  $ 12,580  $ 317,468  $ 330,048  $ 7,394 
Farmland —  2,619  2,619  33,372  35,991  — 
1- 4 family 12,917  10,053  22,970  427,401  450,371  — 
Multifamily 199  27,542  27,741  137,380  165,121  — 
Non-farm non-residential 38,607  58,279  96,886  1,062,956  1,159,842  4,108 
Total Real Estate 53,285  109,511  162,796  1,978,577  2,141,373  11,502 
Non-Real Estate:            
Agricultural 677  1,992  2,669  38,053  40,722  — 
Commercial and industrial 1,293  6,762  8,055  249,463  257,518  — 
Commercial leases —  1,533  1,533  218,667  220,200  — 
Consumer and other 860  233  1,093  41,174  42,267  — 
Total Non-Real Estate 2,830  10,520  13,350  547,357  560,707  — 
Total Loans Before Unearned Income $ 56,115  $ 120,031  $ 176,146  $ 2,525,934  $ 2,702,080  $ 11,502 
Unearned income         (8,300)  
Total Loans Net of Unearned Income         $ 2,693,780   
 
The tables above include $114.3 million and $108.5 million of nonaccrual loans at September 30, 2025 and December 31, 2024, respectively. See the tables below for more detail on nonaccrual loans.

-17-

The following is a summary of nonaccrual loans by class at the dates indicated: 

As of September 30, 2025
(in thousands) With Related Allowance Without Related Allowance Total
Real Estate:    
Construction & land development $ 455  $ 8,252  $ 8,707 
Farmland 2,777  —  2,777 
1- 4 family 9,859  677  10,536 
Multifamily 6,527  17,471  23,998 
Non-farm non-residential 20,579  21,953  42,532 
Total Real Estate 40,197  48,353  88,550 
Non-Real Estate:    
Agricultural 970  916  1,886 
Commercial and industrial 1,654  3,685  5,339 
Commercial leases 17,391  967  18,358 
Consumer and other 132  —  132 
Total Non-Real Estate 20,147  5,568  25,715 
Total Nonaccrual Loans $ 60,344  $ 53,921  $ 114,265 

As of December 31, 2024
(in thousands) With Related Allowance Without Related Allowance Total
Real Estate:    
Construction & land development $ 697  $ 2,927  $ 3,624 
Farmland 678  1,941  2,619 
1- 4 family 7,309  2,744  10,053 
Multifamily 25,986  1,556  27,542 
Non-farm non-residential 7,976  46,195  54,171 
Total Real Estate 42,646  55,363  98,009 
Non-Real Estate:    
Agricultural 729  1,263  1,992 
Commercial and industrial 1,724  5,038  6,762 
Commercial leases —  1,533  1,533 
Consumer and other 233  —  233 
Total Non-Real Estate 2,686  7,834  10,520 
Total Nonaccrual Loans $ 45,332  $ 63,197  $ 108,529 
 



-18-

The following table presents First Guaranty's loan portfolio by credit quality classification and origination year as of the date indicated:
  As of September 30, 2025
Term Loans by Origination Year
(in thousands) 2025 2024 2023 2022 2021 Prior Revolving Loans Total
Real Estate:                
Construction & land development:
   Pass $ 8,327  $ 17,053  $ 80,999  $ 53,065  $ 6,148  1,631  $ 7,198  $ 174,421 
   Special Mention —  1,750  164  11,045  —  127  —  13,086 
   Substandard 1,288  —  33,564  730  129  —  7,938  43,649 
   Doubtful —  —  —  —  —  —  —  — 
Total Construction & land development 9,615  18,803  114,727  64,840  6,277  1,758  15,136  231,156 
Current period gross charge-offs —  —  —  5,794  —  —  —  5,794 
Farmland
      Pass 1,196  2,900  7,440  3,583  3,238  1,950  2,417  22,724 
      Special Mention —  154  —  46  —  2,739  —  2,939 
   Substandard —  2,864  381  22  —  2,755  —  6,022 
   Doubtful —  —  —  —  —  —  —  — 
 Total Farmland 1,196  5,918  7,821  3,651  3,238  7,444  2,417  31,685 
Current period gross charge-offs —  —  —  —  —  —  —  — 
 1- 4 family
   Pass 26,719  57,990  90,410  95,275  53,832  75,703  7,921  407,850 
      Special Mention
 155  114  2,967  1,485  4,570  3,618  605  13,514 
      Substandard 2,111  21  4,675  4,256  2,394  5,757  135  19,349 
      Doubtful —  —  —  76  63  91  74  304 
   Total 1- 4 family 28,985  58,125  98,052  101,092  60,859  85,169  8,735  441,017 
  Current period gross charge-offs —  —  —  21  180  289  —  490 
   Multifamily
      Pass 3,000  439  8,218  41,765  5,308  6,439  1,970  67,139 
      Special Mention —  —  254  4,982  41,209  —  —  46,445 
      Substandard —  —  25  23,973  —  —  —  23,998 
      Doubtful —  —  —  —  —  —  —  — 
   Total Multifamily 3,000  439  8,497  70,720  46,517  6,439  1,970  137,582 
  Current period gross charge-offs —  —  —  10,430  —  —  —  10,430 
   Non-farm non-residential
      Pass 13,956  34,308  164,402  189,522  71,449  263,058  11,241  747,936 
      Special Mention 358  16,690  12,156  337  9,303  45,938  36,373  121,155 
      Substandard 754  11,191  24,353  25,839  30,439  36,963  4,503  134,042 
      Doubtful —  —  —  —  —  65  —  65 
   Total non-farm non-residential 15,068  62,189  200,911  215,698  111,191  346,024  52,117  1,003,198 
  Current period gross charge-offs —  9,432  —  33  80  —  —  9,545 
Total Real Estate 57,864  145,474  430,008  456,001  228,082  446,834  80,375  1,844,638 
Non-Real Estate:
   Agricultural
      Pass 1,706  1,736  1,720  3,140  2,807  3,417  20,946  35,472 
      Special Mention 70  103  74  1,882  —  202  341  2,672 
      Substandard —  4  48  4,322  155  1,816  245  6,590 
      Doubtful —  —  —  —  —  3  —  3 
   Total Agricultural 1,776  1,843  1,842  9,344  2,962  5,438  21,532  44,737 
  Current period gross charge-offs —  169  —  —  —  —  —  169 
   Commercial and industrial
      Pass 51,175  15,922  15,908  6,119  29,952  14,433  64,379  197,888 
-19-

      Special Mention 77  255  2,247  5,103  653  203  2,385  10,923 
      Substandard 71  3,658  41  819  807  724  12,146  18,266 
      Doubtful —  —  —  —  —  —  —  — 
   Total Commercial and industrial 51,323  19,835  18,196  12,041  31,412  15,360  78,910  227,077 
  Current period gross charge-offs —  122  492  260  158  23  —  1,055 
   Commercial leases
      Pass 2,253  18,297  20,929  27,023  11,982  —  —  80,484 
      Special Mention —  —  —  1,295  —  54  —  1,349 
      Substandard —  17,187  26,778  967  8,193  —  —  53,125 
      Doubtful —  —  —  —  —  —  —  — 
   Total Commercial leases 2,253  35,484  47,707  29,285  20,175  54  —  134,958 
  Current period gross charge-offs —  541  —  233  —  —  —  774 
   Consumer and other loans
      Pass 5,874  3,986  11,932  1,866  1,711  8,836  —  34,205 
      Special Mention —  —  1  29  53  12  —  95 
      Substandard —  39  80  134  168  42  —  463 
      Doubtful —  —  —  —  —  —  —  — 
   Total Consumer and other loans 5,874  4,025  12,013  2,029  1,932  8,890  —  34,763 
  Current period gross charge-offs 209  169  209  265  171  81  —  1,104 
Total Non-Real Estate 61,226  61,187  79,758  52,699  56,481  29,742  100,442  441,535 
   Total Loans
      Pass 114,206  152,631  401,958  421,358  186,427  375,467  116,072  1,768,119 
      Special Mention 660  19,066  17,863  26,204  55,788  52,893  39,704  212,178 
      Substandard 4,224  34,964  89,945  61,062  42,285  48,057  24,967  305,504 
      Doubtful —  —  —  76  63  159  74  372 
Total Loans Before Unearned Income $ 119,090  $ 206,661  $ 509,766  $ 508,700  $ 284,563  $ 476,576  $ 180,817  $ 2,286,173 
Unearned income (6,432)
Total Loans Net of Unearned Income $ 2,279,741 
   Total Current Period Gross Charge-offs $ 209  $ 10,433  $ 701  $ 17,036  $ 589  $ 393  $ —  $ 29,361 

  As of December 31, 2024
Term Loans by Origination Year
(in thousands) 2024 2023 2022 2021 2020 Prior Revolving Loans Total
Real Estate:                
Construction & land development:
   Pass $ 18,411  $ 110,178  $ 135,554  $ 17,703  $ 1,728  4,422  $ 12,734  $ 300,730 
   Special Mention 609  16,956  91  —  81  64  30  17,831 
   Substandard —  1,461  8,572  599  246  525  —  11,403 
   Doubtful —  —  —  84  —  —  —  84 
Total Construction & land development 19,020  128,595  144,217  18,386  2,055  5,011  12,764  330,048 
Current period gross charge-offs —  —  39  —  —  —  —  39 
Farmland
      Pass 2,373  11,976  3,499  3,312  1,599  1,922  2,865  27,546 
      Special Mention 3,029  —  57  —  1,656  76  —  4,818 
   Substandard —  381  27  —  2,592  627  —  3,627 
   Doubtful —  —  —  —  —  —  —  — 
 Total Farmland 5,402  12,357  3,583  3,312  5,847  2,625  2,865  35,991 
Current period gross charge-offs —  —  258  —  —  —  —  258 
-20-

 1- 4 family
   Pass 62,044  98,098  101,780  63,313  36,285  47,263  9,896  418,679 
      Special Mention
 431  1,644  1,775  326  2,383  2,320  1,039  9,918 
      Substandard —  4,186  3,129  4,689  1,619  4,343  3,543  21,509 
      Doubtful —  —  73  —  —  119  73  265 
   Total 1- 4 family 62,475  103,928  106,757  68,328  40,287  54,045  14,551  450,371 
  Current period gross charge-offs —  —  174  59  5  796  —  1,034 
   Multifamily
      Pass 446  9,196  44,395  48,143  14,607  5,135  4,419  126,341 
      Special Mention —  —  7,100  506  —  1,577  —  9,183 
      Substandard —  —  28,041  —  —  1,556  —  29,597 
      Doubtful —  —  —  —  —  —  —  — 
   Total Multifamily 446  9,196  79,536  48,649  14,607  8,268  4,419  165,121 
  Current period gross charge-offs —  —  —  —  —  —  —  — 
   Non-farm non-residential
      Pass 68,227  202,084  250,338  95,588  96,967  251,914  38,698  1,003,816 
      Special Mention —  4,390  354  8,509  1,067  34,467  9,208  57,995 
      Substandard 11,356  9,213  32,688  37,181  916  2,917  3,694  97,965 
      Doubtful —  —  —  —  66  —  —  66 
   Total non-farm non-residential 79,583  215,687  283,380  141,278  99,016  289,298  51,600  1,159,842 
  Current period gross charge-offs —  3,793  1,031  3,009  331  836  —  9,000 
Total Real Estate 166,926  469,763  617,473  279,953  161,812  359,247  86,199  2,141,373 
Non-Real Estate:
   Agricultural
      Pass 2,102  2,766  7,815  2,904  1,142  5,676  13,130  35,535 
      Special Mention 18  74  1,793  10  132  112  91  2,230 
      Substandard 169  51  —  663  128  1,915  12  2,938 
      Doubtful —  —  —  —  —  19  —  19 
   Total Agricultural 2,289  2,891  9,608  3,577  1,402  7,722  13,233  40,722 
  Current period gross charge-offs —  —  —  33  —  —  —  33 
   Commercial and industrial
      Pass 27,172  26,410  19,230  39,601  30,833  13,946  80,769  237,961 
      Special Mention 4,082  660  78  91  38  80  306  5,335 
      Substandard 25  59  815  939  193  1,229  10,962  14,222 
      Doubtful —  —  —  —  —  —  —  — 
   Total Commercial and industrial 31,279  27,129  20,123  40,631  31,064  15,255  92,037  257,518 
  Current period gross charge-offs 185  702  913  563  2,168  342  —  4,873 
   Commercial leases
      Pass 48,856  61,057  47,140  38,027  3,554  398  —  199,032 
      Special Mention —  —  18,153  —  —  —  —  18,153 
      Substandard —  —  3,015  —  —  —  —  3,015 
      Doubtful —  —  —  —  —  —  —  — 
   Total Commercial leases 48,856  61,057  68,308  38,027  3,554  398  —  220,200 
  Current period gross charge-offs —  —  —  —  —  —  —  — 
   Consumer and other loans
      Pass 8,457  14,710  4,083  3,257  4,467  6,262  —  41,236 
      Special Mention —  29  42  98  26  —  —  195 
      Substandard 96  176  276  221  29  38  —  836 
      Doubtful —  —  —  —  —  —  —  — 
   Total Consumer and other loans 8,553  14,915  4,401  3,576  4,522  6,300  —  42,267 
  Current period gross charge-offs 438  802  1,013  693  283  125  —  3,354 
Total Non-Real Estate 90,977  105,992  102,440  85,811  40,542  29,675  105,270  560,707 
   Total Loans
-21-

      Pass 238,088  536,475  613,834  311,848  191,182  336,938  162,511  2,390,876 
      Special Mention 8,169  23,753  29,443  9,540  5,383  38,696  10,674  125,658 
      Substandard 11,646  15,527  76,563  44,292  5,723  13,150  18,211  185,112 
      Doubtful —  —  73  84  66  138  73  434 
Total Loans Before Unearned Income $ 257,903  $ 575,755  $ 719,913  $ 365,764  $ 202,354  $ 388,922  $ 191,469  $ 2,702,080 
Unearned income (8,300)
Total Loans Net of Unearned Income $ 2,693,780 
   Total Current Period Gross Charge-offs $ 623  $ 5,297  $ 3,428  $ 4,357  $ 2,787  $ 2,099  $ —  $ 18,591 
 


-22-


Note 5. Allowance for Credit Losses on Loans
 
A summary of changes in the allowance for credit losses, by portfolio type, for the nine months ended September 30, 2025 and 2024 are as follows: 

For the Nine Months Ended September 30,
2025
(in thousands) Beginning Allowance (12/31/2024) Charge-offs Recoveries Provision Ending Allowance (9/30/2025)
Real Estate:
Construction & land development $ 3,930  $ (5,794) $ —  $ 5,673  $ 3,809 
Farmland 50  —  —  137  187 
1- 4 family 9,243  (490) 29  3,084  11,866 
Multifamily 3,949  (10,430) —  7,474  993 
Non-farm non-residential 11,531  (9,545) 19  18,302  20,307 
Total Real Estate 28,703  (26,259) 48  34,670  37,162 
Non-Real Estate:
Agricultural 204  (169) 1  170  206 
Commercial and industrial 1,994  (1,055) 187  4,470  5,596 
Commercial leases 1,719  (774) —  39,884  40,829 
Consumer and other 1,337  (1,104) 426  301  960 
Unallocated 854  —  —  106  960 
Total Non-Real Estate 6,108  (3,102) 614  44,931  48,551 
Total Loans $ 34,811  $ (29,361) $ 662  $ 79,601  $ 85,713 
Unfunded lending commitments 1,210  —  —  (510) 700 
Total $ 36,021  $ (29,361) $ 662  $ 79,091  $ 86,413 

  For the Nine Months Ended September 30,
  2024
(in thousands) Beginning Allowance (12/31/2023) Charge-offs Recoveries Provision Ending Allowance (9/30/2024)
Real Estate:
Construction & land development $ 5,845  $ (39) $ 1  $ (954) $ 4,853 
Farmland 36  (258) —  272  50 
1- 4 family 6,653  (939) 13  1,990  7,717 
Multifamily 1,614  —  —  (156) 1,458 
Non-farm non-residential 10,596  (5,047) 45  8,065  13,659 
Total Real Estate 24,744  (6,283) 59  9,217  27,737 
Non-Real Estate:
Agricultural 97  (33) 26  174  264 
Commercial and industrial 2,711  (4,521) 157  3,251  1,598 
Commercial leases 1,948  —  —  147  2,095 
Consumer and other 1,426  (2,837) 474  2,524  1,587 
Unallocated —  —  —  —  — 
Total Non-Real Estate 6,182  (7,391) 657  6,096  5,544 
Total Loans $ 30,926  $ (13,674) $ 716  $ 15,313  $ 33,281 
Unfunded lending commitments 2,810  —  —  (1,300) 1,510 
Total $ 33,736  $ (13,674) $ 716  $ 14,013  $ 34,791 

Negative provisions are caused by changes in the composition and credit quality of the loan portfolio and by recoveries. The result is an allocation of the credit loss reserve from one category to another.

-23-

A summary of the allowance along with loans and leases individually and collectively evaluated are as follows: 

As of September 30, 2025
(in thousands) Allowance
Individually
Evaluated		 Allowance
Collectively Evaluated		 Total Allowance
for Credit Losses		 Loans
Individually
Evaluated		 Loans
Collectively
Evaluated		 Total Loans
before
Unearned Income
Real Estate:            
Construction & land development $ 566  $ 3,243  $ 3,809  $ 19,081  $ 212,075  $ 231,156 
Farmland 70  117  187  2,543  29,142  31,685 
1- 4 family 857  11,009  11,866  7,867  433,150  441,017 
Multifamily 148  845  993  23,973  113,609  137,582 
Non-farm non-residential 10,635  9,672  20,307  66,651  936,547  1,003,198 
Total Real Estate 12,276  24,886  37,162  120,115  1,724,523  1,844,638 
Non-Real Estate:            
Agricultural —  206  206  915  43,822  44,737 
Commercial and industrial 3,534  2,062  5,596  8,403  218,674  227,077 
Commercial leases 39,739  1,090  40,829  52,921  82,037  134,958 
Consumer and other —  960  960  —  34,763  34,763 
Unallocated —  960  960  —  —  — 
Total Non-Real Estate 43,273  5,278  48,551  62,239  379,296  441,535 
Total $ 55,549  $ 30,164  $ 85,713  $ 182,354  $ 2,103,819  2,286,173 
Unearned Income           (6,432)
Total Loans Net of Unearned Income           $ 2,279,741 

$146.3 million of loans individually evaluated for impairment as of September 30, 2025 were considered collateral dependent loans.
 
  As of December 31, 2024
(in thousands) Allowance
Individually
Evaluated		 Allowance
Collectively Evaluated		 Total Allowance
for Credit Losses		 Loans
Individually
Evaluated		 Loans
Collectively
Evaluated		 Total Loans
before
Unearned Income
Real Estate:            
Construction & land development $ 403  $ 3,527  $ 3,930  $ 10,724  $ 319,324  $ 330,048 
Farmland —  50  50  2,973  33,018  35,991 
1- 4 family 430  8,813  9,243  3,174  447,197  450,371 
Multifamily 2,942  1,007  3,949  27,516  137,605  165,121 
Non-farm non-residential 1,229  10,302  11,531  54,201  1,105,641  1,159,842 
Total Real Estate 5,004  23,699  28,703  98,588  2,042,785  2,141,373 
Non-Real Estate:            
Agricultural 129  75  204  2,151  38,571  40,722 
Commercial and industrial 3  1,991  1,994  5,194  252,324  257,518 
Commercial leases —  1,719  1,719  3,015  217,185  220,200 
Consumer and other —  1,337  1,337  —  42,267  42,267 
Unallocated —  854  854  —  —  — 
Total Non-Real Estate 132  5,976  6,108  10,360  550,347  560,707 
Total $ 5,136  $ 29,675  $ 34,811  $ 108,948  $ 2,593,132  2,702,080 
Unearned Income           (8,300)
Total loans net of unearned income           $ 2,693,780 

All loans individually evaluated for impairment as of December 31, 2024 were considered collateral dependent loans.

As of September 30, 2025 and December 31, 2024, First Guaranty had loans totaling $114.3 million and $108.5 million, respectively, not accruing interest. First Guaranty had no loans past due 90 days or more and still accruing interest as of September 30, 2025 as compared to $11.5 million as of December 31, 2024. The average outstanding balance of nonaccrual loans for the nine months ended September 30, 2025 was $121.3 million compared to $63.4 million for the year ended December 31, 2024.

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The Bank held loans that were individually evaluated for impairment at September 30, 2025 for which the repayment, on the basis of the assessment at the reporting date, is expected to be provided substantially though the operation or sale of the collateral and the borrower is experiencing financial difficulty. The Allowance for Credit Losses for these collateral-dependent loans is primarily based on the fair value of the underlying collateral at the reporting date. The following describes the type of collateral that secure collateral dependent loans:

•Residential real estate loans are primarily secured by first liens on residential real estate.
•Commercial real estate loans are primarily secured by office and industrial buildings, warehouses, retail shopping facilities and various special purpose properties, including hotels and restaurants.
•Construction and land loans are primarily secured by residential and commercial properties, which are under construction and/or redevelopment, and by raw land.
•Commercial loans are primarily secured by accounts receivable, inventory and equipment.
•Agriculture loans are primarily secured by farmland and equipment.

Loan Modifications Made to Borrowers Experiencing Financial Difficulty

Occasionally, the Bank modifies loans to borrowers in financial distress by providing certain concessions, such as principal forgiveness, term extension, an other-than-insignificant payment delay, interest only for a specified period of time, an interest rate reduction, or a combination of such concessions. When principal forgiveness is provided, the amount of forgiveness is charged-off against the allowance for credit losses. Upon the Bank’s determination that a modified loan (or portion of a loan) has subsequently been deemed uncollectible, the loan (or portion of the loan) is charged-off. Reportable modifications to borrowers experiencing financial difficulty (MEFD) during the nine months ended September 30, 2025 consisted of a $17.6 million term extension. The Bank had no unfunded commitments to borrowers whose terms have been modified as a reportable MEFD as of September 30, 2025.

As of September 30, 2025, there have been $1.0 million in loans that were modified with in the previous 12 months for which there has been payment default during the period.




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Note 6. Goodwill and Other Intangible Assets
 
Goodwill and intangible assets deemed to have indefinite lives are no longer amortized but are subject to impairment testing. The Company is required to conduct testing of goodwill impairment periodically (at least annually) and upon the occurrence of certain triggering events, which are events or circumstances that make it more likely than not that the fair value of its goodwill is below its carrying amount. The Company performed a quantitative impairment test as of September 30, 2025, using a combination of market and income approaches, including the guideline public company method, guideline precedent transaction method, and discounted cash flow analysis, which was triggered by the Company's stock price trading below book value and the recent increase in credit provisions. Based on the results of the test, the Company concluded the goodwill of $12.9 million was impaired; therefore, a one-time non-cash impairment charge was recorded.

Other intangible assets continue to be amortized over their useful lives. Loan servicing assets totaled $0.3 million at September 30, 2025 and $0.4 million at December 31, 2024. Other intangible assets recorded include core deposit intangibles, which are subject to amortization. The weighted-average amortization period remaining for First Guaranty's core deposit intangibles is 3.5 years at September 30, 2025. The core deposits intangible reflect the value of deposit relationships, including the beneficial rates, which arose from acquisitions.
 
Note 7. Other Real Estate (ORE)
 
Other real estate owned consists of the following at the dates indicated: 

(in thousands) September 30, 2025 December 31, 2024
Other Real Estate Owned:    
Residential $ 234  $ 226 
Construction & land development 8,545  3 
Non-farm non-residential 3,271  90 
Total Other Real Estate Owned 12,050  319 
Allowance for Other Real Estate Owned losses —  — 
Net Other Real Estate Owned $ 12,050  $ 319 

During the quarter ended September 30, 2025, First Guaranty transferred $4.4 million of existing bank owned properties previously used as either operating branches or future branch development to other real estate owned. The Bank plans to sell these properties.

Loans secured by one-to-four family residential properties in the process of foreclosure totaled $1.6 million as of September 30, 2025.

Note 8. Borrowings

During the quarter ended June 30, 2025, First Guaranty entered into an Exchange Agreement which provided for the exchange of certain floating rate subordinated debt due June 21, 2032, in the principal amount of $15.0 million, held by a related party for 1,981,506 shares of newly issued common stock of First Guaranty.

First Guaranty also entered into the amendments to the promissory note for the senior debt owed to a related party and subordinated note to a related party which allows First Guaranty to make payment of interest either in cash or shares of common stock for the period June 30, 2025 through March 31, 2026.

As of March 31, 2025, First Guaranty was not in compliance with one financial covenant under its credit agreement for its senior debt. First Guaranty’s adjusted Texas Ratio exceeded 35% at March 31, 2025. As a result, the interest rate on the senior loan was increased by one percent to 8.0% for the second quarter of 2025. The lender has provided a waiver for this covenant breach effective June 30, 2025 through March 31, 2026.

First Guaranty issued 31,701 shares of common stock for payment in kind ("PIK") interest due on the senior debt for the quarter ended September 30, 2025. First Guaranty issued 78,571 shares of common stock as PIK payments of interest on a $30.0 million subordinated debt for the quarter ended September 30, 2025.















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Note 9. Commitments and Contingencies
 
Off-balance sheet commitments
 
First Guaranty is a party to financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of its customers and to reduce its own exposure to fluctuations in interest rates. These financial instruments include commitments to extend credit and standby and commercial letters of credit. Those instruments involve, to varying degrees, elements of credit and interest rate risk in excess of the amount recognized in the consolidated balance sheets. The contract or notional amounts of those instruments reflect the extent of the involvement in particular classes of financial instruments.
 
The 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 notional amount of those instruments. The same credit policies are used in making commitments and conditional obligations as it does for balance sheet instruments. Unless otherwise noted, collateral or other security is not required to support financial instruments with credit risk.
 
Below is a summary of the notional amounts of the financial instruments with off-balance sheet risk at September 30, 2025 and December 31, 2024:

Contract Amount
(in thousands) September 30, 2025 December 31, 2024
Commitments to Extend Credit $ 54,450  $ 134,178 
Unfunded Commitments under lines of credit $ 171,167  $ 186,006 
Commercial and Standby letters of credit $ 18,413  $ 13,576 
 
Allowance For Credit Losses - Off- Balance-Sheet Credit Exposures

The provision for credit losses on unfunded commitments was a reversal of $0.5 million and $1.3 million for the nine months ended September 30, 2025 and September 30, 2024, respectively. The ACL on off-balance-sheet credit exposures total $0.7 million at September 30, 2025 and $1.2 million at December 31, 2024 and is included in other liabilities on the accompanying consolidated balance sheets.

Litigation

First Guaranty is subject to various legal proceedings in the normal course of its business. First Guaranty assesses its liabilities and contingencies in connection with outstanding legal proceedings. Where it is probable that First Guaranty will incur a loss and the amount of the loss can be reasonably estimated, First Guaranty records a liability in its consolidated financial statements. First Guaranty does not record a loss if the loss is not probable or the amount of the loss is not estimable. First Guaranty Bank is a defendant in a lawsuit alleging fault for a loss of funds by a customer related to fraud by a third party with a possible loss range of $0.0 million to $1.5 million. The Bank denies the allegations and intends to vigorously defend against this lawsuit, which is in early stages and no trial date has been set. No accrued liability has been recorded related to this lawsuit. In the opinion of management, neither First Guaranty nor First Guaranty Bank is currently involved in such legal proceedings, either individually or in the aggregate, that the resolution is expected to have a material adverse effect on First Guaranty’s consolidated results of operations, financial condition, or cash flows. However, one or more unfavorable outcomes in these ordinary claims or litigation against First Guaranty or First Guaranty Bank could have a material adverse effect for the period in which they are resolved. In addition, regardless of their merits or ultimate outcomes, such matters are costly, divert management’s attention, and may materially and adversely affect the reputation of First Guaranty and First Guaranty Bank, even if resolved favorably.





















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Note 10. Leases

First Guaranty’s primary leasing activities relate to certain real estate leases of a portion of the main office, certain branches, and certain ATM locations. These leases have all been designated as operating leases. First Guaranty does not lease equipment under operating leases, and does not have leases designated as financing leases.

On June 28, 2024 First Guaranty sold three properties owned by it, two stand-alone branches and a portion of the headquarters building which also contains a branch, to a partnership owned by certain directors of First Guaranty. The aggregate purchase price was approximately $14.7 million. All of the properties are located in Louisiana.

First Guaranty recorded operating right-of-use ("ROU") assets and corresponding lease liabilities of $11.5 million and $11.5 million, respectively.

First Guaranty concurrently entered into absolute net lease agreements with the partnership under which First Guaranty will lease each of the properties. Each of the lease agreements has an initial term of 15 years with specified renewal options. Annual payments due under the leases total approximately $1.3 million. The sale-leaseback transaction resulted in a pre-tax gain of approximately $13.3 million.


Information concerning First Guaranty’s leases is as follows:

Nine Months Ended
September 30, 2025		 Nine Months Ended
September 30, 2024
Weighted-average lease term (in years) 13.5 14.5
Weighted-average discount rate 7.9  % 7.9  %

First Guaranty’s operating lease ROU assets were $11.2 million and $11.6 million at September 30, 2025 and December 31, 2024, respectively, and the related operating lease liabilities were $11.3 million and $11.6 million, respectively. The ROU asset is included in Other Assets on the balance sheet, and the related operating lease liabilities are included in Other liabilities.

Operating lease expense, including short-term leases, is included in occupancy expense in the amount of $1.3 million and $0.6 million for the nine months ended September 30, 2025 and 2024, respectively. Lease expense for lease payments is recognized on a straight-line basis over the lease term. Cash payment for amounts included in the measurement of lease liabilities of $1.1 million and $0.4 million were included in operating cash flows for the respective nine- periods.

The following table reports minimum lease payments under non-cancelable operating leases at September 30, 2025:

(in thousands)
2025 $ 352 
2026 1,406 
2027 1,406 
2028 1,351 
2029 1,307 
Thereafter 12,797 
Total lease payments 18,619 
Less: interest (7,332)
Present value of lease liabilities $ 11,287 
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Note 11. Fair Value Measurements

The fair value of a financial instrument is the current amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. A fair value measurement assumes that the transaction to sell the asset or transfer the liability occurs in the principal market for the asset or liability or, in the absence of a principal market, the most advantageous market for the asset or liability. Valuation techniques use certain inputs to arrive at fair value. Inputs to valuation techniques are the assumptions that market participants would use in pricing the asset or liability. They may be observable or unobservable. First Guaranty uses a fair value hierarchy for valuation inputs that gives the highest priority to quoted prices in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The fair value hierarchy is as follows:
 
Level 1 Inputs – Unadjusted quoted market prices in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date.
 
Level 2 Inputs – Inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These might include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (such as interest rates, volatilities, prepayment speeds or credit risks) or inputs that are derived principally from or corroborated by market data by correlation or other means.
 
Level 3 Inputs – Unobservable inputs for determining the fair values of assets or liabilities that reflect an entity's own assumptions about the assumptions that market participants would use in pricing the assets or liabilities.
 
A description of the valuation methodologies used for instruments measured at fair value follows, as well as the classification of such instruments within the valuation hierarchy.
 
Securities available for sale. Securities are classified within Level 1 where quoted market prices are available in an active market. Inputs include securities that have quoted prices in active markets for identical assets. If quoted market prices are unavailable, fair value is estimated using quoted prices of securities with similar characteristics, at which point the securities would be classified within Level 2 of the hierarchy. Securities classified within Level 3 in First Guaranty's portfolio as of September 30, 2025 includes corporate debt and municipal securities.

Loan individually evaluated for impairment. Fair value is measured by either the fair value of the collateral if the loan is collateral dependent (Level 2 or Level 3), or the present value of expected future cash flows, discounted at the loan's effective interest rate (Level 3). Fair value of the collateral is determined by appraisals or by independent valuation. 

Other real estate owned. Properties are recorded at the balance of the loan or at estimated fair value less estimated selling costs, whichever is less, at the date acquired. Fair values of other real estate owned ("OREO") are determined by sales agreement or appraisal, and costs to sell are based on estimation per the terms and conditions of the sales agreement or amounts commonly used in real estate transactions. Inputs include appraisal values or recent sales activity for similar assets in the property's market; thus, OREO measured at fair value would be classified within either Level 2 or Level 3 of the hierarchy. First Guaranty transferred $4.4 million of existing bank owned properties previously used as either operating branches or future branch development to other real estate owned. The Bank plans to sell these properties. The properties are included in Level 2 as of September 30, 2025.
 
Certain non-financial assets and non-financial liabilities are measured at fair value on a non-recurring basis including assets and liabilities related to reporting units measured at fair value in the testing of goodwill impairment, as well as intangible assets and other non-financial long-lived assets measured at fair value for impairment assessment.

The following table summarizes financial assets measured at fair value on a recurring basis as of September 30, 2025 and December 31, 2024, segregated by the level of the valuation inputs within the fair value hierarchy utilized to measure fair value: 
(in thousands) September 30, 2025 December 31, 2024
Available for Sale Securities Fair Value Measurements Using:    
Level 1: Quoted Prices in Active Markets For Identical Assets $ —  $ 147,780 
Level 2: Significant Other Observable Inputs 368,586  127,222 
Level 3: Significant Unobservable Inputs 5,749  6,095 
Securities available for sale measured at fair value $ 374,335  $ 281,097 
 
First Guaranty's valuation methodologies may produce a fair value calculation that may not be indicative of net realizable value or reflective of future fair values. While the methodologies used are appropriate and consistent with other market participants, the use of different methodologies or assumptions to determine the fair value of certain financial instruments could result in a different estimate of fair value.

The change in Level 1 securities available for sale from December 31, 2024 to September 30, 2025 was due to a net decrease in Treasury bills of $147.8 million. There were no transfers between Level 2 and Level 3 from December 31, 2024 to September 30, 2025. There were no transfers between Level 1 and 2 securities available for sale from December 31, 2024 to September 30, 2025.


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The following table reconciles assets measured at fair value on a recurring basis using unobservable inputs (Level 3):
  Level 3 Changes
(in thousands) September 30, 2025
Balance, beginning of year $ 6,095 
Total gains or losses (realized/unrealized):  
Included in earnings — 
Included in other comprehensive income 95 
Purchases, sales, issuances and settlements, net (441)
Transfers in and/or out of Level 3 — 
Balance as of end of period $ 5,749 

There were no gains or losses for the period included in earnings attributable to the change in unrealized gains or losses related to assets still held as of September 30, 2025.

The following table measures financial assets and financial liabilities measured at fair value on a non-recurring basis as of September 30, 2025 and December 31, 2024, segregated by the level of valuation inputs within the fair value hierarchy utilized to measure fair value: 

(in thousands) At September 30, 2025 At December 31, 2024
Fair Value Measurements Using: Loans Individually Evaluated for Impairment    
Level 1: Quoted Prices in Active Markets For Identical Assets $ —  $ — 
Level 2: Significant Other Observable Inputs —  — 
Level 3: Significant Unobservable Inputs 72,151  50,449 
Loans individually evaluated for impairment measured at fair value $ 72,151  $ 50,449 
Fair Value Measurements Using: Other Real Estate Owned    
Level 1: Quoted Prices in Active Markets For Identical Assets $ —  $ — 
Level 2: Significant Other Observable Inputs 12,000  319 
Level 3: Significant Unobservable Inputs 50  — 
Other real estate owned measured at fair value $ 12,050  $ 319 

ASC 825-10 provides First Guaranty with an option to report selected financial assets and liabilities at fair value. The fair value option established by this statement permits First Guaranty to choose to measure eligible items at fair value at specified election dates and report unrealized gains and losses on items for which the fair value option has been elected in earnings at each reporting date subsequent to implementation.
 
First Guaranty has chosen not to elect the fair value option for any items that are not already required to be measured at fair value in accordance with accounting principles generally accepted in the United States.
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Note 12. Financial Instruments
 
Fair value estimates are generally subjective in nature and are dependent upon a number of significant assumptions associated with each instrument or group of similar instruments, including estimates of discount rates, risks associated with specific financial instruments, estimates of future cash flows and relevant available market information. Fair value information is intended to represent an estimate of an amount at which a financial instrument could be exchanged in a current transaction between a willing buyer and seller engaging in an exchange transaction. However, since there are no established trading markets for a significant portion of First Guaranty's financial instruments, First Guaranty may not be able to immediately settle financial instruments; as such, the fair values are not necessarily indicative of the amounts that could be realized through immediate settlement. In addition, the majority of the financial instruments, such as loans and deposits, are held to maturity and are realized or paid according to the contractual agreement with the customer.
 
Quoted market prices are used to estimate fair values when available. However, due to the nature of the financial instruments, in many instances quoted market prices are not available. Accordingly, estimated fair values have been estimated based on other valuation techniques, such as discounting estimated future cash flows using a rate commensurate with the risks involved or other acceptable methods. Fair values are estimated without regard to any premium or discount that may result from concentrations of ownership of financial instruments, possible income tax ramifications or estimated transaction costs. The fair value estimates are subjective in nature and involve matters of significant judgment and, therefore, cannot be determined with precision. Fair values are also estimated at a specific point in time and are based on interest rates and other assumptions at that date. As events change the assumptions underlying these estimates, the fair values of financial instruments will change.
 
Disclosure of fair values is not required for certain items such as lease financing, investments accounted for under the equity method of accounting, obligations of pension and other postretirement benefits, premises and equipment, other real estate, prepaid expenses, the value of long-term relationships with depositors (core deposit intangibles) and other customer relationships, other intangible assets and income tax assets and liabilities. Fair value estimates are presented for existing on- and off-balance sheet financial instruments without attempting to estimate the value of anticipated future business and the value of assets and liabilities that are not considered financial instruments. In addition, the tax ramifications related to the realization of the unrealized gains and losses have not been considered in the estimates. Accordingly, the aggregate fair value amounts presented do not purport to represent and should not be considered representative of the underlying market or franchise value of First Guaranty.
 
Because the standard permits many alternative calculation techniques and because numerous assumptions have been used to estimate the fair values, reasonable comparison of the fair value information with other financial institutions' fair value information cannot necessarily be made. The methods and assumptions used to estimate the fair values of financial instruments are as follows:
 
Cash and due from banks, interest-bearing deposits with banks, federal funds sold and federal funds purchased.
 
These items are generally short-term and the carrying amounts reported in the consolidated balance sheets are a reasonable estimation of the fair values. Cash and due from bank for the purposes of the Consolidated Statements of Cash Flows include cash on hand, balances due from banks: which includes non-interest and interest-bearing accounts, and federal funds sold, all of which mature within ninety days.
 
Investment Securities.
 
Fair values are principally based on quoted market prices. If quoted market prices are not available, fair values are based on quoted market prices of comparable instruments or the use of discounted cash flow analyses.
 
Loans Held for Sale.
 
Fair values of mortgage loans held for sale are based on commitments on hand from investors or prevailing market prices. These loans are classified within level 3 of the fair value hierarchy.
 
Loans, net.
 
Market values are computed present values using net present value formulas. The present value is the sum of the present value of all projected cash flows on an item at a specified discount rate. The discount rate is set as an appropriate rate index, plus or minus an appropriate spread. These loans are classified within level 3 of the fair value hierarchy.
 
Loan individually evaluated for impairment.

Fair value is measured by either the fair value of the collateral if the loan is collateral dependent (Level 2 or Level 3), or the present value of expected future cash flows, discounted at the loan's effective interest rate (Level 3). Fair value of the collateral is determined by appraisals or by independent valuation.

Accrued interest receivable.
 
The carrying amount of accrued interest receivable approximates its fair value.
 
Deposits.
 
The fair value of customer deposits, excluding certificates of deposit, is the amount payable on demand. Market values of certificates of deposit are actually computed present values using net present value formulas. The present value is the sum of the present value of all projected cash flows on an item at a specified discount rate.
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The discount rate is set as an appropriate rate index, plus or minus an appropriate spread. Deposits are classified within level 3 of the fair value hierarchy.

 Accrued interest payable.
 
The carrying amount of accrued interest payable approximates its fair value.
 
Borrowings.
 
The carrying amount of federal funds purchased and other short-term borrowings approximate their fair values. The fair value of First Guaranty's long-term borrowings is computed using net present value formulas. The present value is the sum of the present value of all projected cash flows on an item at a specified discount rate. The discount rate is set as an appropriate rate index, plus or minus an appropriate spread. Borrowings are classified within level 3 of the fair value hierarchy.
 
The carrying amounts and estimated fair values of financial instruments at September 30, 2025 were as follows:

Fair Value Measurements at September 30, 2025 Using
(in thousands) Carrying Amount Level 1 Level 2 Level 3 Total
Assets
Cash and due from banks $ 753,629  $ 753,629  $ —  $ —  $ 753,629 
Federal funds sold 554  554  —  —  554 
Securities, available for sale 374,335  —  368,586  5,749  374,335 
Securities, held for maturity 322,413  —  264,566  —  264,566 
Loans held for sale —  —  —  —  — 
Loans, net 2,194,028  —  —  2,178,784  2,178,784 
Accrued interest receivable 14,776  —  —  14,776  14,776 
Liabilities
Deposits $ 3,354,897  $ —  $ —  $ 3,359,607  3,359,607 
Repurchase agreements 7,117  —  —  7,141  7,141 
Accrued interest payable 16,333  —  —  16,333  16,333 
Long-term advances from Federal Home Loan Bank 135,000  —  —  136,373  136,373 
Senior long-term debt 14,196  —  —  14,266  14,266 
Junior subordinated debentures 29,790  —  —  30,000  30,000 


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The carrying amounts and estimated fair values of financial instruments at December 31, 2024 were as follows:

Fair Value Measurements at December 31, 2024 Using
(in thousands) Carrying Amount Level 1 Level 2 Level 3 Total
Assets
Cash and due from banks $ 563,778  $ 563,778  $ —  $ —  $ 563,778 
Federal funds sold 430  430  —  —  430 
Securities, available for sale 281,097  147,780  127,222  6,095  281,097 
Securities, held for maturity 321,622  —  251,458  —  251,458 
Loans, net 2,658,969  —  —  2,508,440  2,508,440 
Accrued interest receivable 14,850  —  —  14,850  14,850 
Liabilities
Deposits $ 3,476,260  $ —  $ —  $ 3,475,411  3,475,411 
Repurchase agreements 7,009  —  —  7,005  7,005 
Accrued interest payable 20,437  —  —  20,437  20,437 
Long-term advances from Federal Home Loan Bank 135,000  —  —  134,977  134,977 
Senior long-term debt 15,169  —  —  15,274  15,274 
Junior subordinated debentures 44,745  —  —  45,000  45,000 

There is no material difference between the contract amount and the estimated fair value of off-balance sheet items that are primarily comprised of short-term unfunded loan commitments that are generally at market prices.

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Note 13. Segment Reporting

First Guaranty is engaged in a single line of business as a financial institution, which provides a full range of banking, financial and trust services to state, county and local government entities and individuals and small and commercial businesses. First Guaranty has identified its President and Chief Executive Officer as the chief operating decision maker (“CODM”), who uses consolidated net income (see Consolidated Statements of Income) to determine how resources should be allocated and manage First Guaranty. First Guaranty’s operations constitute a single operating segment and therefore, a single reportable segment, because the CODM manages the business activities using information of First Guaranty as a whole. The accounting policies used to measure the profit and loss of the segment are the same as those described in the summary of significant accounting policies described in Note 1 included in Form 10-K for the year ended December 31, 2024. First Guaranty’s most significant reported source of income and expense are interest income and interest expense (see Consolidated Statements of Income). The remaining significant segment income and expenses are described in the Consolidated Statements of Income.
 
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Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
 
The following discussion of First Guaranty's financial condition and results of operations is intended to highlight the significant factors affecting First Guaranty's financial condition and results of operations presented in the consolidated financial statements included in this Form 10-Q. This discussion is designed to provide readers with a more comprehensive view of the operating results and financial position than would be obtained from reading the consolidated financial statements alone. Reference should be made to those statements for an understanding of the following review and analysis. The financial data at September 30, 2025 and for the three and nine months ended September 30, 2025 and 2024 have been derived from unaudited consolidated financial statements and include, in the opinion of management, all adjustments (consisting of normal recurring accruals and provisions) necessary to present fairly First Guaranty's financial position and results of operations for such periods.
 
Special Note Regarding Forward-Looking Statements
 
Congress passed the Private Securities Litigation Act of 1995 in an effort to encourage corporations to provide information about a company's anticipated future financial performance. This act provides a safe harbor for such disclosure, which protects us from unwarranted litigation, if actual results are different from management expectations. This discussion and analysis contains forward-looking statements and reflects management's current views and estimates of future economic circumstances, industry conditions, company performance and financial results. The words "may," "should," "expect," "anticipate," "intend," "plan," "continue," "believe," "seek," "estimate" and similar expressions are intended to identify forward-looking statements. These forward-looking statements are subject to a number of factors and uncertainties, including, changes in general economic conditions, either nationally or in our market areas, that are worse than expected; competition among depository and other financial institutions; inflation and changes in the interest rate environment that reduce our margins or reduce the fair value of financial instruments; adverse changes in the securities markets; changes in laws or government regulations or policies affecting financial institutions, including changes in regulatory fees and capital requirements; our ability to enter new markets successfully and capitalize on growth opportunities; our ability to successfully integrate acquired entities; changes in consumer spending, borrowing and savings habits; changes in accounting policies and practices, as may be adopted by the bank regulatory agencies, the Financial Accounting Standards Board, the Securities and Exchange Commission and the Public Company Accounting Oversight Board; changes in our organization, compensation and benefit plans; changes in our financial condition or results of operations that reduce capital available to pay dividends; increases in our provision for credit losses and changes in the financial condition or future prospects of issuers of securities that we own, which could cause our actual results and experience to differ from the anticipated results and expectations, expressed in such forward-looking statements. We undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise.


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Third Quarter and Nine Months Ended September 30, 2025, Financial Overview
 
First Guaranty Bancshares is a Louisiana corporation and a financial holding company headquartered in Hammond, Louisiana. Our wholly-owned subsidiary, First Guaranty Bank, a Louisiana-chartered commercial bank, provides personalized commercial banking services primarily to Louisiana and Texas customers through 31 banking facilities primarily located in the MSAs of Hammond, Baton Rouge, Lafayette, Shreveport-Bossier City, Lake Charles and Alexandria, Louisiana and Dallas-Fort Worth-Arlington, Waco, Texas and Mideast markets in Kentucky and West Virginia. We emphasize personal relationships and localized decision making to ensure that products and services are matched to customer needs. We compete for business principally on the basis of personal service to customers, customer access to officers and directors and competitive interest rates and fees.
 
Financial highlights for the third quarter and nine months ended September 30, 2025 are as follows:

•Net (loss) income for the three months ended September 30, 2025 and 2024 was $(45.0) million and $1.9 million respectively, a decrease of $46.9 million. Net (loss) income for the nine months ended September 30, 2025 and 2024 was $(58.5) million and $11.4 million, respectively, a decrease of $69.9 million. During the third quarter, First Guaranty recorded a $47.9 million provision for credit losses. $39.8 million of the $47.9 million provision was associated with one commercial lease relationship further described below. The provision for credit losses, together with the goodwill impairment charge of $12.9 million, were the primary drivers for the loss in the quarter, as net interest income, noninterest income and noninterest expense (excluding the goodwill impairment) were stable.

•First Guaranty has a $52.0 million credit exposure associated with commercial lease financing to entities related to an auto parts manufacturer that declared Chapter 11 bankruptcy during the third quarter. The credit exposure consists of one $17.2 million commercial lease, which was past due on its payments and placed on nonaccrual as of September 30, 2025, and three commercial leases totaling $34.8 million that were current on payments and remained on accrual status as of September 30, 2025. First Guaranty has downgraded all four lease credits to substandard and impaired status. A specific reserve of $17.2 million has been established for the nonaccrual credit and a specific reserve of $22.6 million has been established for the three lease credits that remain on accrual status. Further analysis will be performed as bankruptcy proceedings progress in the fourth quarter of 2025. The commercial leases are serviced by a third party.

•First Guaranty recognized a one-time non-cash impairment charge to goodwill of $12.9 million. The impairment was the result of First Guaranty's stock price trading below book value and the recent increase in credit provisions. The impairment charge did not impact regulatory capital ratios.

•Total assets decreased $175.4 million and were $3.8 billion at September 30, 2025 compared to December 31, 2024. Total loans at September 30, 2025 were $2.3 billion, a decrease of $414.0 million, or 15.4%, compared with December 31, 2024. Total deposits were $3.4 billion at September 30, 2025, a decrease of $121.4 million, or 3.5%, compared with December 31, 2024. Retained earnings were $12.3 million at September 30, 2025, a decrease of $60.6 million compared to $73.0 million at December 31, 2024. Shareholders' equity was $221.1 million and $255.0 million at September 30, 2025 and December 31, 2024, respectively.

•(Loss) earnings per common share were $(3.01) and $0.11 for the three months ended September 30, 2025 and 2024, respectively. Total weighted average shares outstanding were 15,122,702 and 12,504,717 for the three months ended September 30, 2025 and 2024, respectively. (Loss) earnings per common share were $(4.45) and $0.78 for the nine months ended September 30, 2025 and 2024, respectively. Total weighted average shares outstanding were 13,523,009 and 12,499,799 for the nine months ended September 30, 2025 and 2024, respectively. The change in shares was primarily due to the conversion into common stock of $15.0 million in subordinated debt in the second quarter and the issuance of 667,970 shares of common stock under private placement during 2025, of which 122,503 shares were issued in the third quarter. In addition, 198,754 shares were issued in 2025 as payment in kind, including 110,272 shares in the third quarter.

•The allowance for credit losses was $85.7 million or 3.76% of total loans at September 30, 2025 compared to $34.8 million or 1.29% at December 31, 2024.

•Net interest income for the three months ended September 30, 2025 was $22.2 million compared to $22.7 million for the three months ended September 30, 2024. Net interest income for the nine months ended September 30, 2025 was $66.7 million compared to $65.9 million for the nine months ended September 30, 2024.

•The provision for credit losses for the three months ended September 30, 2025 was $47.9 million compared to $4.9 million for the three months ended September 30, 2024. The provision for credit losses for the nine months ended September 30, 2025 was $79.1 million compared to $14.0 million for the nine months ended September 30, 2024.

•Charge-offs were $21.3 million during the three months ended September 30, 2025 and $2.6 million during the same period in 2024. Charge-offs for the third quarter of 2025 were concentrated with two commercial real estate credits. $9.4 million was charged off on an independent living center located in Louisiana. $10.4 million was charged off on an apartment complex located in Texas. Recoveries totaled $0.3 million during the three months ended September 30, 2025 and $0.2 million during the same period in 2024. Charge-offs were $29.4 million during the nine months ended September 30, 2025 and $13.7 million during the same period in 2024. Recoveries totaled $0.7 million during the nine months ended September 30, 2025 and $0.7 million during the same period in 2024.


•First Guaranty had $12.1 million of other real estate owned as of September 30, 2025 compared to $0.3 million at December 31, 2024. $7.4 million of other real estate owned as of September 30, 2025 is comprised of a land development project that is under contract to be sold in the fourth quarter of 2025. First Guaranty also transferred $4.4 million of existing bank owned properties previously used as either operating branches or future branch development to other real estate owned. The Bank plans to sell these properties. The largest property is currently under sales contract for $2.2 million and is to be sold during the fourth quarter of 2025.
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•The net interest margin for the three months ended September 30, 2025 was 2.34% which was a decrease of 17 basis points from the net interest margin of 2.51% for the same period in 2024. The net interest margin for the nine months ended September 30, 2025 was 2.35% which was a decrease of 17 basis points from the net interest margin of 2.52% for the same period in 2024. Loans as a percentage of average interest earning assets decreased to 65.1% at September 30, 2025 compared to 80.0% at September 30, 2024.

•Investment securities net of the allowance for credit losses totaled $696.7 million at September 30, 2025, an increase of $94.0 million when compared to $602.7 million at December 31, 2024. At September 30, 2025, available for sale securities, at fair value, totaled $374.3 million, an increase of $93.2 million when compared to $281.1 million at December 31, 2024. At September 30, 2025, held to maturity securities, at amortized cost and net of the allowance for credit losses totaled $322.4 million, an increase of $0.8 million when compared to $321.6 million at December 31, 2024. The allowance for credit losses for HTM securities was $0.2 million at September 30, 2025 and December 31, 2024.

•Total loans net of unearned income were $2.3 billion at September 30, 2025, a net decrease of $414.0 million from December 31, 2024. Total loans net of unearned income are reduced by the allowance for credit losses which totaled $85.7 million at September 30, 2025 and $34.8 million at December 31, 2024, respectively.

•Nonaccrual loans increased $5.7 million to $114.3 million at September 30, 2025 compared to $108.5 million at December 31, 2024. Nonaccrual loans decreased $4.9 million when compared to June 30, 2025. The decrease compared to June 30, 2025 was due principally to the payoff on an $8.8 million commercial real estate loan located in the Midwest and to associated charge-offs on existing nonaccrual loans that totaled $21.3 million in the quarter. The decrease was partially offset by the $17.2 million commercial lease placed into nonaccrual.

•At September 30, 2025, the largest 10 non-performing loan relationships comprise 77% of total non-performing loans. Additional details on these non-performing relationships are as follows:
1.A $18.1 million loan relationship secured by an independent living center located in Louisiana; the loan was placed on nonaccrual in the fourth quarter of 2024. The principal balance was $27.5 million at June 30, 2025 and was charged down by $9.4 million in the third quarter of 2025.
2.A $17.2 million commercial equipment lease located primarily in Kansas; it was placed in nonaccrual in the third quarter of 2025. This relates to the auto parts bankruptcy.
3.A $15.4 million loan relationship secured by a multifamily apartment complex located in Texas; the loan was placed on nonaccrual in the fourth quarter of 2024. The principal balance was $25.8 million at June 30, 2025 and was charged down by $10.4 million in the third quarter of 2025.
4.A $15.1 million loan relationship secured by an assisted living center located in Louisiana; the loan was placed on nonaccrual in the second quarter of 2025. Payments received on the loan in the third quarter of 2025 reduced the balance by $0.5 million.
5.A $8.3 million loan relationship secured by an assisted living center located in Texas; the loan was placed on nonaccrual in the third quarter of 2025.
6.A $7.4 million loan relationship secured by land located in Texas; the loan was transferred to other real estate owned in the second quarter of 2025.
7.A $6.5 million loan relationship secured by a multifamily apartment complex located in Texas; the loan was placed on nonaccrual in the second quarter of 2025.
8.A $5.2 million loan relationship was placed on nonaccrual during the second quarter of 2025. The loan is secured by multifamily apartment complexes located in Louisiana.
9.A $2.2 million loan relationship was placed on nonaccrual during the third quarter of 2025. This loan is secured by a retail location located in Florida.
10.A $1.6 million loan relationship was placed on nonaccrual during the fourth quarter of 2024. This loan is secured by a convenience store located in Texas.

•First Guaranty charged off $21.3 million in loan balances during the third quarter of 2025. The details of the $21.3 million in charged-off loans were as follows:
•First Guaranty charged off $0.3 million in consumer loans during the third quarter of 2025. The consumer loan charge-offs included $0.1 million in credit card loans, $0.1 million of loans secured by automobiles or equipment, and $0.1 million in unsecured loans.
•First Guaranty charged off $10.4 million on a multifamily loan during the third quarter of 2025. This relationship had a remaining principal balance of $15.4 million as of September 30, 2025.
•First Guaranty charged off $9.4 million on a non-farm non-residential loan relationship secured by an independent living center during the third quarter of 2025. This relationship had a remaining principal balance of $18.1 million as of September 30, 2025.
•First Guaranty charged off $0.5 million on a commercial lease loan relationship during the third quarter of 2025. This relationship had no remaining principal balance as of September 30, 2025.
•First Guaranty charged off $0.4 million on a 1-4 family loan relationship during the third quarter of 2025. This relationship had a remaining principal balance of $0.7 million as of September 30, 2025.
•Smaller loans and overdrawn deposit accounts comprised the remaining $0.3 million of charge-offs for the third quarter of 2025.

•Noninterest expense totaled $30.2 million for the third quarter of 2025 (including $12.9 million of goodwill impairment), $17.3 million for the second quarter of 2025, $18.0 million for the first quarter of 2025, $17.9 million for the fourth quarter of 2024, and $19.7 million for the third quarter of 2024.
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Full time equivalent employees totaled 339 at September 30, 2025. Full time equivalent employees totaled 360 at June 30, 2025, 380 at March 31, 2025, 399 at December 31, 2024, and 404 at September 30, 2024.

•Return on average assets for the three months ended September 30, 2025 and 2024 was (4.61)% and 0.21%, respectively. Return on average assets for the nine months ended September 30, 2025 and 2024 was (2.00)% and 0.42%, respectively. Return on average common equity for the three months ended September 30, 2025 and 2024 was (78.41)% and 2.40%, respectively. Return on average common equity for the nine months ended September 30, 2025 and 2024 was (35.83)% and 5.87% respectively. Return on average assets is calculated by dividing annualized net income by average assets. Return on average common equity is calculated by dividing annualized net income by average common equity.

•Book value per common share was $12.25 as of September 30, 2025 compared to $17.75 as of December 31, 2024. The decrease was due primarily to the decrease in retained earnings, partially offset by the recent issuance of new shares and changes in accumulated other comprehensive income ("AOCI"). AOCI is comprised of unrealized gains and losses on available for sale securities, including unrealized losses on available for sale securities at the time of transfer to held to maturity.

•First Guaranty's Board of Directors declared cash dividends of $0.01 and $0.08 per common share in the third quarter of 2025 and 2024. The reduction in the common stock dividend payment was done in order to preserve capital as part of First Guaranty’s new business strategy announced in the third quarter of 2024. First Guaranty has paid 129 consecutive quarterly dividends as of September 30, 2025.

•First Guaranty paid preferred stock dividends of $1.7 million during the first nine months of 2025 and 2024.

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Financial Condition
 
Changes in Financial Condition from December 31, 2024 to September 30, 2025
 
Assets
 
Total assets at September 30, 2025 were $3.8 billion, a decrease of $175.4 million from December 31, 2024. Assets decreased primarily due to a decrease in net loans of $464.9 million partially offset by increases in cash and cash equivalents of $190.0 million and investment securities of $94.0 million at September 30, 2025 compared to December 31, 2024.
 
Loans
 
Net loans decreased $464.9 million, or 17.5%, to $2.2 billion at September 30, 2025 from December 31, 2024. First Guaranty adopted a change in its business plan in July 2024 that focused on reducing risk in the balance sheet, including risk associated with the loan portfolio. As part of this strategy, First Guaranty has reduced loan originations, charged-off loan balances and conducted select loan sales, which have each contributed to a decline in loan balances. Non-farm non-residential loan balances decreased $156.6 million due to the sale of loans and paydowns. Construction and land development loans decreased $98.9 million principally due to the sale of loans, charge-offs, and the conversion of existing loans to permanent financing. Commercial lease loan balances decreased $85.2 million primarily due to paydowns on the existing lease portfolio. First Guaranty's commercial lease portfolio generally has higher yields than commercial real estate loans but shorter average lives. Multifamily loans decreased $27.5 million primarily due to paydowns and charge-offs. Commercial and industrial loans decreased $30.4 million primarily due to paydowns. One-to-four family residential loans decreased $9.4 million primarily due to paydowns. Farmland loans decreased $4.3 million primarily due to seasonal activity. Consumer and other loans decreased $7.5 million primarily due to paydowns. Agricultural loans increased $4.0 million due to seasonal activity. First Guaranty had approximately 3.1% of funded and 1.5% of unfunded commitments in our loan portfolio to businesses engaged in support or service activities for oil and gas operations. First Guaranty's hotel and hospitality portfolio totaled $162.4 million at September 30, 2025. First Guaranty had $270.2 million in loans related to our Texas markets at September 30, 2025 compared to $407.1 million at December 31, 2024. First Guaranty had $323.5 million in loans related to our Mideast markets in Kentucky and West Virginia at September 30, 2025 compared to $335.5 million at December 31, 2024. Syndicated loans at September 30, 2025 were $48.5 million, of which $19.8 million were shared national credits. Syndicated loans decreased $5.3 million from $53.9 million at December 31, 2024.

As of September 30, 2025, 80.7% of our loan portfolio was secured by real estate. The largest portion of our loan portfolio, at 43.9% as of September 30, 2025, was non-farm non-residential loans secured by real estate. Approximately 56.4% of the loan portfolio was based on a floating rate tied to the prime rate, Secured Overnight Financing Rate ("SOFR"), or Treasury rates as of September 30, 2025. 43.9% of the loan portfolio is scheduled to mature within five years from September 30, 2025.

Commercial real estate (“CRE”) has received increased regulatory scrutiny in recent quarters due to valuation concerns associated with the increase in market interest rates and the impact of the COVID-19 pandemic. First Guaranty has utilized enhanced risk management practices for CRE concentration analysis for several years. First Guaranty Bank’s credit department conducts an annual stress test for CRE related loans that is presented to the Bank’s board of directors. The stress test analyzes the impact of changes in interest rates and cash flow on loan customers with credit exposures of $2.5 million or greater. First Guaranty generally requires personal guarantees on CRE loans. First Guaranty generally approves CRE loans with loan-to-values of 80% or less. First Guaranty also generally requires for construction related CRE loans that the borrower provides their equity contribution upfront before loan funds are advanced. First Guaranty modified its business strategy in 2024 to reduce exposure to commercial real estate related loans, particularly loans secured by non-owner occupied properties and construction loans for commercial real estate. First Guaranty continued this strategy in 2025.

First Guaranty has diversified its CRE portfolio across both industries and geographic location. The following is a summary of the largest CRE related loans associated with hotel and motels, office properties, apartment complexes, healthcare related properties, and properties under construction as of September 30, 2025. First Guaranty generally does not finance multi-story office buildings in major metropolitan areas. The largest CRE loan secured by a hotel or motel totaled $19.5 million. The property is a flagged hotel located in Texas. The largest CRE loan secured by an office related property totaled $21.1 million and is located in West Virginia. The largest CRE loan secured by an apartment complex totaled $40.7 million and is located in Louisiana. The largest healthcare related loan is a $20.6 million property secured by a hospital located in Louisiana. The largest CRE loan under construction totaled $32.0 million for an apartment complex and is secured by a property located in Texas.

The increase in classified assets at September 30, 2025 as compared to December 31, 2024 was due to a $120.4 million increase in substandard loans. The increase in substandard loans was primarily the result of downgrades during 2025. The details of the top 10 substandard loan relationships as of September 30, 2025 are listed below:
1.A $52.0 million commercial lease relationship to entities associated with the aforementioned auto parts manufacturer. The collateral for these leases are located in multiple states. This relationship was classified substandard at the end of third quarter in 2025. The principal balances consists of one lease for $17.2 million which was nonaccrual as of September 30, 2025 and three leases totaling $34.8 million that were on accrual status as of September 30, 2025. The $17.2 million lease was originated in 2024 and has a specific reserve of $17.2 million. The $34.8 million leases were originated between 2021 and 2024 and had specific reserves of $22.6 million.
2.A $47.0 million loan relationship secured by real estate and business assets. This is a construction business located primarily in Louisiana. The loan relationship was classified as substandard in the third quarter of 2024. The loan relationship is on accrual status and there is no specific reserve established for it. The loan was originated between 2022 and 2024.
3.A $23.8 million loan relationship secured by real estate. This is a hospital located in Arkansas. The relationship was designated as substandard in the second quarter of 2025. The loan was originated in 2021 and is on accrual status.
4.A $18.1 million loan relationship secured by an independent living center located in Louisiana; the loan was placed on nonaccrual in the fourth quarter of 2024. The principal balance was $27.5 million at June 30, 2025 and was charged down by $9.4 million in the third quarter of 2025. The loan was originated in 2023. It has a specific reserve of $10.5 million as of September 30, 2025.
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5.A $15.7 million construction and land development loan relationship secured by land located in Texas. The loan was classified as substandard in the first quarter of 2024. The loan was originated in 2023 and is on accrual status.
6.A $15.4 million loan relationship secured by a multifamily apartment complex located in Texas; the loan was placed on nonaccrual in the fourth quarter of 2024. The principal balance was $25.8 million at June 30, 2025 and was charged down by $10.4 million in the third quarter of 2025. The loan was originated in 2022.
7.A $15.1 million loan relationship secured by an assisted living center located in Louisiana; the loan was placed on nonaccrual in the second quarter of 2025. Payments received on the loan in the third quarter of 2025 reduced the balance by $0.5 million. The loan was originated in 2019.
8.A $13.9 million loan relationship secured by commercial real estate located in Oklahoma. The loan was designated substandard in the first quarter of 2025. The loan was originated in 2020 and is on accrual status.
9.A $11.5 million construction loan for the development of a truck stop and convenience store located in Louisiana. The loan was designed substandard in the first quarter of 2025. The loan was originated in 2022 and is on accrual status.
10.A $8.3 million loan relationship secured by an assisted living center located in Texas; the loan was placed on nonaccrual in the third quarter of 2025. The loan was originated in 2023.

Top 10 Substandard Relationships
 
Current Balance Allocated Reserve Origination Year(s) Location
Relationship Description        
1 Commercial Leases $ 51,954  $ 39,739  2021-2024 Multiple States
2 Construction Business 47,000  —  2022-2024 Louisiana & Texas
3 Hospital 23,750  —  2021 Arkansas
4 Independent Living Center 18,070  10,460  2023 Louisiana
5 Subdivision Development 15,746  —  2023 Texas
6 Apartment Complex 15,390  —  2022 Texas
7 Assisted Living Center 15,121  —  2019 Louisiana
8 Commercial Retail Shopping Center 13,857  —  2020 Oklahoma
9 Convenience Store 11,514  —  2022 Louisiana
10 Assisted Living Center 8,252  —  2023 Texas
$ 220,654  $ 50,199 

Special mention loans increased by $86.5 million in 2025. The increase in special mention loans was primarily the result of downgrades during 2025. The details of the top 10 special mention loan relationships as of September 30, 2025 are listed below:
1.A $40.7 million multifamily loan relationship secured by an apartment complex in Louisiana. The loan is on accrual status. The loan was designated as special mention in the third quarter of 2025. The loan was originated in 2021.
2.A $39.6 million loan relationship to a manufacturing company secured by real estate and business assets located in Louisiana. The loan is on accrual status. The loan was designated special mention in the third quarter of 2025. The loan relationship is over ten years old.
3.A $20.3 million loan relationship to a marine industry company secured by real estate. The loan was designated special mention in the first quarter of 2025. The loan was originated in 2020.
4.A $15.9 million non-farm non-residential relationship secured by a warehouse located in Louisiana. The loan was designated special mention in the first quarter of 2025. The loan was originated in 2024.
5.A $10.8 million construction and land development secured by land located in Texas. The loan was designated special mention in the second quarter of 2025. The loan was originated in 2022.
6.A $8.7 million non-farm non-residential relationship secured by a hotel located in Mississippi. The loan was designated special mention in the fourth quarter of 2024. The loan was originated in 2015.
7.A $7.8 million loan relationship secured by commercial real estate located in Louisiana. The loan was designated special mention in the fourth quarter of 2024. The loan was originated in 2011.
8.A $7.5 million non-farm non-residential relationship secured by an office located in Texas. The loan was designated special mention in the fourth quarter of 2024. The loan was originated in 2021.
9.A $5.0 million multifamily loan relationship secured by an apartment complex located in Florida. The loan was designated special mention in the first quarter of 2025. The loan was originated in 2022.
10.A $4.9 million loan relationship secured by a hotel property located in Georgia. The loan was designated special mention in the third quarter of 2025. The loan was originated in 2023.

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Top 10 Special Mention Relationships
 
Current Balance Allocated Reserve Origination Year(s) Location
Relationship Description        
1 Apartment Complex $ 40,719  $ —  2021 Louisiana
2 Manufacturing Company 39,575  —  2015-2024 Louisiana
3 Marine Industry 20,281  —  2020 Louisiana
4 Warehouse Facility/Office Complex 15,919  —  2024 Louisiana
5 Subdivision Development 10,808  —  2022 Texas
6 Hotel 8,670  —  2015 Mississippi
7 Warehouse Facility 7,780  —  2011 Louisiana
8 Office 7,534  —  2021 Texas
9 Apartment Complex 4,965  —  2022 Florida
10 Hotel Properties 4,859  —  2023 Georgia
$ 161,110  $ — 

Net loans are reduced by the allowance for credit losses which totaled $85.7 million at September 30, 2025 and $34.8 million at December 31, 2024. Loan charge-offs were $29.4 million during the first nine months of 2025 and $13.7 million during the same period in 2024. Recoveries totaled $0.7 million during the first nine months of 2025 and $0.7 million during the same period in 2024. The provision for credit losses totaled $79.1 million for the first nine months of 2025 and $14.0 million for the same period in 2024. See Note 4 of the Notes to Consolidated Financial Statements for more information on loans and Note 5 for more information on the allowance for credit losses.

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Investment Securities
 
Investment securities net of the allowance for credit losses at September 30, 2025 totaled $696.7 million, an increase of $94.0 million compared to $602.7 million at December 31, 2024. The portfolio consists of both available for sale (AFS) and held to maturity securities (HTM). The securities designated as held to maturity are agency and corporate debt securities that are part of First Guaranty’s investment strategy and public funds collateralization program. We purchase securities for our investment portfolio to provide a source of liquidity, to provide an appropriate return on funds invested, to manage interest rate risk and meet pledging requirements for public funds and borrowings.
 
The securities portfolio consisted principally of U.S. Government and Government agency securities, agency mortgage-backed securities, U.S. Government mortgage-backed securities, corporate debt securities and municipal bonds. U.S. government agencies consist of FHLB, Federal Farm Credit Bank ("FFCB"), Freddie Mac and Fannie Mae obligations. Mortgage-backed securities that we purchase are issued by Freddie Mac, Fannie Mae, or the U.S Government (GNMA). Management monitors the securities portfolio for both credit and interest rate risk. We generally limit the purchase of corporate securities to individual issuers to manage concentration and credit risk. Corporate securities generally have a maturity of 10 years or less. U.S. Government securities consist of U.S. Treasury securities that have maturities of less than two years. Government agency securities generally have maturities of 15 years or less. Agency and Government mortgage-backed securities generally stated final maturities of 15 to 20 years.

Our available for sale securities portfolio totaled $374.3 million at September 30, 2025, an increase of $93.2 million, or 33.2%, compared to $281.1 million at December 31, 2024. The increase was primarily due to the purchase of collateralized mortgage obligations and mortgage-backed securities. In the third quarter of 2025, First Guaranty has primarily purchased U.S. Government securities and U.S. Government mortgage-backed and collateralized mortgage obligations.
 
Our held to maturity securities portfolio net of the allowance for credit losses totaled $322.4 million at September 30, 2025, an increase of $0.8 million, or 0.2%, compared to $321.6 million at December 31, 2024.
 
At September 30, 2025, $3.6 million, or 0.5%, of the securities portfolio was scheduled to mature in less than one year. $30.5 million, or 4.4%, of the securities portfolio, not including collateralized mortgage obligations and mortgage-backed securities, were scheduled to mature between one and five years. The majority of these securities were corporate bonds. $132.0 million, or 18.9%, of the securities portfolio, not including collateralized mortgage obligations and mortgage-backed securities, were scheduled to mature between five and ten years. Securities, not including collateralized mortgage obligations and mortgage-backed securities, with contractual maturity dates over 10 years totaled $182.0 million, or 26.1%, of the total securities portfolio at September 30, 2025. The average maturity of the securities portfolio is affected by call options that may be exercised by the issuer of the securities and are influenced by market interest rates. Prepayments of mortgages that collateralize mortgage-backed securities also affect the maturity of the securities portfolio. Based on internal forecasts as of September 30, 2025, management believes that the securities portfolio has a forecasted weighted average life of approximately 7.02 years based on the current interest rate environment. The portfolio had an estimated effective duration of 5.28 years at September 30, 2025.
 
There were no credit related impairment of available for sale securities during the nine months ended September 30, 2025 or 2024. The allowance for credit losses for held to maturity securities was $0.2 million at September 30, 2025 and December 31, 2024.

Nonperforming Assets
 
Nonperforming assets consist of nonperforming loans and other real estate owned. Nonperforming loans are those on which the accrual of interest has stopped or loans which are contractually 90 days past due on which interest continues to accrue. Loans are ordinarily placed on nonaccrual status when principal and interest is delinquent for 90 days or more. However, management may elect to continue the accrual when the asset is well secured and in the process of collection. It is our policy to discontinue the accrual of interest income on any loan for which we have reasonable doubt as to the payment of interest or principal. When a loan is placed on nonaccrual status, unpaid interest credited to income is reversed. Nonaccrual loans are returned to accrual status when the financial position of the borrower indicates there is no longer any reasonable doubt as to the payment of principal or interest and a reasonable payment performance period is observed (generally considered six months or longer). Other real estate owned consists of property acquired through formal foreclosure, in-substance foreclosure or by deed in lieu of foreclosure.

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The table below sets forth the amounts and categories of our nonperforming assets at the dates indicated. 
(in thousands) September 30, 2025 December 31, 2024
Nonaccrual loans:    
Real Estate:    
Construction and land development $ 8,707  $ 3,624 
Farmland 2,777  2,619 
1- 4 family 10,536  10,053 
Multifamily 23,998  27,542 
Non-farm non-residential 42,532  54,171 
Total Real Estate 88,550  98,009 
Non-Real Estate:    
Agricultural 1,886  1,992 
Commercial and industrial 5,339  6,762 
Commercial leases 18,358  1,533 
Consumer and other 132  233 
Total Non-Real Estate 25,715  10,520 
Total nonaccrual loans 114,265  108,529 
Loans 90 days and greater delinquent & accruing:    
Real Estate:    
Construction and land development —  7,394 
Farmland —  — 
1- 4 family —  — 
Multifamily —  — 
Non-farm non-residential —  4,108 
Total Real Estate —  11,502 
Non-Real Estate:    
Agricultural —  — 
Commercial and industrial —  — 
Commercial leases —  — 
Consumer and other —  — 
Total Non-Real Estate —  — 
Total loans 90 days and greater delinquent & accruing —  11,502 
Total nonperforming loans 114,265  120,031 
Real Estate Owned:    
Construction and land development 8,545  226 
Farmland —  — 
1- 4 family 234  3 
Multifamily —  — 
Non-farm non-residential 3,271  90 
Total Real Estate Owned 12,050  319 
Total nonperforming assets $ 126,315  $ 120,350 
Nonperforming assets to total loans 5.54  % 4.47  %
Nonperforming assets to total assets 3.33  % 3.03  %
Nonperforming loans to total loans 5.01  % 4.46  %
Nonaccrual loans to total loans 5.01  % 4.03  %
Allowance for credit losses to nonaccrual loans 75.01  % 32.08  %
Net loan charge-offs to average loans 1.55  % 0.64  %




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Top 10 Non-Performing Assets
 
Current Balance Allocated Reserve Origination Year Location
Asset Description        
1 Independent Living Center $ 18,070  $ 10,460  2021 Louisiana
2 Commercial Lease 17,187  17,187  2024 Kansas
3 Apartment Complex 15,390  —  2022 Texas
4 Assisted Living Center 15,121  —  2019 Louisiana
5 Assisted Living Center 8,252  —  2023 Texas
6 Land Development OREO 7,384  —  2022 Texas
7 Apartment Complex 6,502  148  2022 Texas
8 Apartment Complex 5,244  857  2023 Louisiana
9 Retail Location 2,150  —  2020 Florida
10 Convenience Store 1,640  —  2021 Texas
$ 96,940  $ 28,652 

At September 30, 2025, nonperforming assets totaled $126.3 million, or 3.33% of total assets, compared to $120.4 million, or 3.03%, of total assets at December 31, 2024, which represented an increase of $6.0 million, or 5.0%. The increase in nonperforming assets occurred primarily due to an increase in nonaccrual loans and other real estate, partially offset by a decrease in loans 90 days greater delinquent. Nonperforming loans included loans previously classified as purchase credit deteriorated following the adoption of CECL.

Nonaccrual loans increased from $108.5 million at December 31, 2024 to $114.3 million at September 30, 2025. Nonaccrual loans included $4.6 million in loans with a government guarantee. These are structured as net loss guarantees in which up to 90% of loss exposure is covered.
 
At September 30, 2025, there were no loans 90 days or greater delinquent and still accruing, compared to $11.5 million at December 31, 2024. The decrease in loans 90 days or greater delinquent and still accruing was attributed to moving those loans to nonaccrual.

Other real estate owned totaled $12.1 million at September 30, 2025, an increase of $11.7 million compared to $0.3 million at December 31, 2024. $7.4 million of other real estate owned as of September 30, 2025 is comprised of a land development project that is under contract to be sold in the fourth quarter of 2025. First Guaranty also transferred $4.4 million of existing bank owned properties previously used as either operating branches or future branch development to other real estate owned. The Bank plans to sell these properties.

At September 30, 2025, the largest 10 non-performing loans comprise 77% of total non-performing assets. Additional details on the non-performing loan relationships are as follows:
1.A $18.1 million loan relationship secured by an independent living center located in Louisiana; the loan was placed on nonaccrual in the fourth quarter of 2024. The principal balance was $27.5 million at June 30, 2025 and was charged down by $9.4 million in the third quarter of 2025.
2.A $17.2 million commercial equipment lease located primarily in Kansas; it was placed in nonaccrual in the third quarter of 2025. This relates to the auto parts bankruptcy.
3.A $15.4 million loan relationship secured by a multifamily apartment complex located in Texas; the loan was placed on nonaccrual in the fourth quarter of 2024. The principal balance was $25.8 million at June 30, 2025 and was charged down by $10.4 million in the third quarter of 2025.
4.A $15.1 million loan relationship secured by an assisted living center located in Louisiana; the loan was placed on nonaccrual in the second quarter of 2025. Payments received on the loan in the third quarter of 2025 reduced the balance by $0.5 million.
5.A $8.3 million loan relationship secured by an assisted living center located in Texas; the loan was placed on nonaccrual in the third quarter of 2025.
6.A $7.4 million loan relationship secured by land located in Texas; the loan was transferred to other real estate owned in the second quarter of 2025.
7.A $6.5 million loan relationship secured by a multifamily apartment complex located in Texas; the loan was placed on nonaccrual in the second quarter of 2025.
8.A $5.2 million loan relationship was placed on nonaccrual during the second quarter of 2025. The loan is secured by multifamily apartment complexes located in Louisiana.
9.A $2.2 million loan relationship was placed on nonaccrual during the third quarter of 2025. This loan is secured by a retail location located in Florida.
10.A $1.6 million loan relationship was placed on nonaccrual during the fourth quarter of 2024. This loan is secured by a convenience store located in Texas.


 

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Allowance for Credit Losses

First Guaranty adopted FASB ASC Topic 326 “Financial Instruments – Credit Losses: Measurement of Credit Losses on Financial Instruments” Update No. 2016-13 (“ASU 2016-13”). ASU 2016-13 on January 1, 2023. ASU 2016-13, referred to as the Current Expected Credit Loss (“CECL”) standard, requires financial assets measured on an amortized cost basis, including loans and held-to-maturity debt securities, to be presented at an amount net of an allowance for credit losses, which reflects expected losses for the full life of the financial asset. Unfunded lending commitments are also within the scope of this topic. Under prior GAAP losses were not recognized until the occurrence of the loss was probable.
 
The allowance for credit losses on loans is maintained to absorb potential losses in the loan portfolio. The allowance is increased by the provision for loan losses, offset by recoveries of previously charged-off loans and is decreased by loan charge-offs. The provision is a charge to current expense to provide for current expected loan losses and to maintain the allowance commensurate with management's evaluation of the risks inherent in the loan portfolio. Various factors are taken into consideration when determining the amount of the provision and the adequacy of the allowance. These factors include but are not limited to:
 
•past due and nonperforming assets;

•specific internal analysis of loans requiring special attention;

•the current level of regulatory classified and criticized assets and the associated risk factors with each;

•changes in underwriting standards or lending procedures and policies;

•charge-off and recovery practices;

•national and local economic and business conditions;

•nature and volume of loans;

•overall portfolio quality;

•adequacy of loan collateral;

•quality of loan review system and degree of oversight by our board of directors;

•competition and legal and regulatory requirements on borrowers;

•examinations of the loan portfolio by federal and state regulatory agencies and examinations; and

•review by our internal loan review department and independent accountants.
 
The data collected from all sources in determining the adequacy of the allowance is evaluated on a regular basis by management with regard to current national and local economic trends, prior loss history, underlying collateral values, credit concentrations and industry risks. An estimate of potential loss on specific loans is developed in conjunction with an overall risk evaluation of the total loan portfolio. This evaluation is inherently subjective as it requires estimates that are susceptible to significant revision as new information becomes available. 

The allowance consists of specific, general, and unallocated components. The specific component relates to loans that are classified as doubtful, substandard, or collateral dependent. For such loans that are also classified as collateral dependent, an allowance is established when the collateral value is lower than the carrying value of that loan. The general component covers non-classified loans and special mention loans and is based on historical loss experience for the past three years adjusted for qualitative factors described above. An unallocated component is maintained to cover uncertainties that could affect the estimate of probable losses.
 
The balance in the allowance for credit losses is principally influenced by the provision for loan losses, recoveries, and by net loan loss experience. Additions to the allowance are charged to the provision for credit losses. Losses are charged to the allowance as incurred and recoveries on losses previously charged to the allowance are credited to the allowance at the time recovery is collected.
 
The allowance for credit losses on loans was $85.7 million, or 3.76% of total loans, and 75.0% of nonperforming loans at September 30, 2025.

Comparing September 30, 2025 to December 31, 2024, there were changes within the specific components of the allowance balance.

A provision for credit losses of $79.1 million was made during the nine months ended September 30, 2025 and $14.0 million for the same period in 2024. The $79.1 million provision made in 2025 included a $0.5 million negative provision for credit losses related to unfunded commitments. First Guaranty's unfunded commitments declined during the first nine months of 2025 which resulted in a reduced liability. The provisions made were taken to provide for current credit losses and to maintain the allowance proportionate to risks inherent in the loan portfolio.


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The loan portfolio factors in the first nine months of 2025 that primarily affected the allocation of the allowance included the following:

•Construction and land development loans decreased during the first nine months of 2025 due to the sale of loans. The allowance decrease was due primarily to charge-offs of the portfolio.

•One-to-four family residential loans decreased $9.4 million during the first nine months of 2025. The allowance increase related to this portfolio was due to changes in the qualitative analysis of the portfolio, and a $0.4 million increase in the allowance for loan individually evaluated.

•Multifamily loans decreased $27.5 million during the first nine months of 2025. The allowance decrease related to this portfolio was due to primarily to charge-offs of the portfolio, and a $2.8 million decrease in the allowance for loan individually evaluated.

•Non-farm non-residential loans decreased by $156.6 million during the first nine months of 2025. The allowance increase related to this portfolio was due to changes in the qualitative analysis of the portfolio related to economic conditions, and a $9.4 million increase in the allowance for loans individually evaluated.

•Commercial and industrial loans decreased $30.4 million during the first nine months of 2025. The allowance increase related to this portfolio was due to changes in the qualitative analysis of the portfolio, and a $3.5 million increase in the allowance for loans individually evaluated.

•Commercial leases decreased $85.2 million during the first nine months of 2025. The allowance increase related to this portfolio was due to changes in the qualitative analysis of the portfolio, and a $39.7 million increase in the allowance for loans individually evaluated.

•Consumer and other loans decreased $7.5 million during the first nine months of 2025. The decrease in the related loan loss allowance balance was due primarily to charge-offs and qualitative analysis of the portfolio.

First Guaranty charged off $29.4 million in loan balances during the first nine months of 2025. The details of the $29.4 million in charged-off loans were as follows:

1.First Guaranty charged off $0.9 million in consumer loans during the first nine months of 2025. The consumer loan charge-offs included $0.2 million in credit card loans, $0.3 million of loans secured by automobiles or equipment, and $0.4 million in unsecured loans.
2.First Guaranty charged off $4.9 million on a construction and land development loan that was subsequently sold during the first quarter of 2025. This relationship had no remaining principal balance as of September 30, 2025.
3.First Guaranty charged off $0.9 million on a construction and land development loan that was subsequently sold during the first quarter of 2025. This relationship had no remaining principal balance as of September 30, 2025.
4.First Guaranty charged off $0.3 million on a commercial and industrial loan during the second quarter of 2025. This relationship had no remaining principal balance as of September 30, 2025.
5.First Guaranty charged off $0.2 million on a commercial lease loan relationship during the second quarter of 2025. This relationship had a remaining principal balance of $1.0 million as of September 30, 2025.
6.First Guaranty charged off $10.4 million on a multifamily loan during the third quarter of 2025. This relationship had a remaining principal balance of $15.4 million as of September 30, 2025.
7.First Guaranty charged off $9.4 million on a non-farm non-residential loan relationship secured by an independent living center during the third quarter of 2025. This relationship had a remaining principal balance of $18.1 million as of September 30, 2025.
8.First Guaranty charged off $0.5 million on a commercial lease loan relationship during the third quarter of 2025. This relationship had no remaining principal balance as of September 30, 2025.
9.First Guaranty charged off $0.4 million on a one-to-four family loan relationship during the third quarter of 2025. This relationship had a remaining principal balance of $0.7 million as of September 30, 2025.
10.Smaller loans and overdrawn deposit accounts comprised the remaining $1.5 million of charge-offs for the first nine months of 2025.


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Other information related to the allowance for credit losses is as follows: 

(in thousands) Nine Months Ended
September 30, 2025		 Nine Months Ended
September 30, 2024
Loans:    
Average outstanding balance $ 2,476,128  $ 2,793,397 
Balance at end of period $ 2,279,741  $ 2,833,350 
Allowance for Credit Losses:
Balance at beginning of year $ 34,811  $ 30,926 
Charge-offs (29,361) (11,052)
Recoveries 662  504 
Provision 79,601  9,909 
Balance at end of period $ 85,713  $ 30,287 

Deposits
 
Managing the mix and pricing the maturities of deposit liabilities is an important factor affecting our ability to maximize our net interest margin. The strategies used to manage interest-bearing deposit liabilities are designed to adjust as the interest rate environment changes. We regularly assess our funding needs, deposit pricing and interest rate outlooks. From December 31, 2024 to September 30, 2025, total deposits decreased $121.4 million, or 3.5%, to $3.4 billion. Noninterest-bearing demand deposits decreased $7.2 million, or 1.8%, to $396.9 million at September 30, 2025. The decrease in noninterest-bearing demand deposits was primarily concentrated in business noninterest-bearing demand deposits. The majority of the decrease in business noninterest-bearing demand deposits was associated with seasonal activity that increased at the end of September 30, 2025. Interest-bearing demand deposits increased $3.2 million, or 0.2%, to $1.4 billion at September 30, 2025. The increase in interest-bearing demand deposits was primarily concentrated in public funds interest-bearing demand deposits that have seasonal fluctuations. Savings deposits decreased $19.4 million, or 8.3%, to $215.1 million at September 30, 2025, primarily related to decreases in business and individual savings deposits. Time deposits decreased $98.0 million, or 6.8%, to $1.4 billion at September 30, 2025, primarily due to decreases in brokered time deposits.

Management will continue to evaluate and update our product mix and related technology in its efforts to attract additional customers. We currently offer a number of deposit products that are competitively priced and designed to attract and retain customers with primary emphasis on noninterest-bearing deposits, select time deposits and other lower cost deposits.

As of September 30, 2025, the aggregate amount of outstanding certificates of deposit in amounts greater than $250,000 was approximately $185.2 million. At September 30, 2025, approximately $23.4 million of First Guaranty's certificates of deposit greater than $250,000 had a remaining term greater than one year.

The total amount of our uninsured deposits (deposits in excess of $250,000, as calculated in accordance with FDIC regulations) was estimated at $264.3 million at September 30, 2025. This total excludes public funds deposits that are collateralized by securities or FHLB letters of credit. The amount of uninsured deposits including collateralized public funds deposits was estimated at $840.7 million at September 30, 2025.
 
The following table sets forth the distribution of our time deposit accounts. 

(in thousands) September 30, 2025
Time deposits of less than $100,000 $ 847,405 
Time deposits of $100,000 through $250,000 320,096 
Time deposits of more than $250,000 185,194 
Total Time Deposits $ 1,352,695 

The following table sets forth the maturity of the time deposits greater than $250,000 at September 30, 2025.
 
(in thousands) September 30, 2025
Three months or less $ 59,261 
Three to six months 49,122 
Six months to one year 53,382 
One to three years 9,298 
More than three years 14,131 
Total Time Deposits greater than $250,000 $ 185,194 


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Public funds deposits totaled $1.1 billion at September 30, 2025 and $1.0 billion at December 31, 2024. Public funds time deposits totaled $62.6 million at September 30, 2025 compared to $78.4 million at December 31, 2024. Public funds deposits increased due to seasonal fluctuations. First Guaranty has developed a program for the retention and management of public funds deposits. Since the end of 2012, First Guaranty has maintained public funds deposits in excess of $400.0 million. These deposits are from public entities such as school districts, hospital districts, sheriff departments and municipalities. The majority of these funds are under fiscal agency agreements with terms of three years or less. Deposits under fiscal agency agreements are generally stable but public entities may maintain the ability to negotiate term deposits on a specific basis including with other financial institutions. These deposits generally have stable balances as we maintain both operating accounts and time deposits for these entities. There is a seasonal component to public deposit levels associated with annual tax collections. Public funds will increase at the end of the year and during the first quarter. In addition to seasonal fluctuations, there are monthly fluctuations associated with internal payroll and short-term tax collection accounts for our public funds deposit accounts. Public funds deposit accounts are collateralized by FHLB letters of credit, by expanded reciprocal deposit insurance programs, by Louisiana municipal bonds and by eligible government and government agency securities such as those issued by the FHLB, FFCB, Fannie Mae, and Freddie Mac. First Guaranty continues to grow the proportion of its public funds portfolio that is collateralized by reciprocal deposit insurance as an alternative to pledging securities or utilizing FHLB letters of credit. First Guaranty initiated this strategy to invest these deposits more efficiently in higher yielding loans to improve the net interest margin and earnings. Total public funds collateralized by reciprocal deposit insurance programs decreased to $543.1 million at September 30, 2025 compared to $609.4 million at December 31, 2024.

The following table sets forth public funds as a percent of total deposits.

(in thousands except for %) September 30, 2025 December 31, 2024
Public Funds:    
Noninterest-bearing Demand $ 4,659  $ 4,385 
Interest-bearing Demand 1,011,968  915,067 
Savings 17,477  48,925 
Time 62,635  78,420 
Total Public Funds $ 1,096,739  $ 1,046,797 
Total Deposits $ 3,354,897  $ 3,476,260 
Total Public Funds as a percent of Total Deposits 32.7  % 30.1  %

Borrowings
 
First Guaranty maintains borrowing relationships with other financial institutions as well as the Federal Home Loan Bank on a short and long-term basis to meet liquidity needs. First Guaranty had $7.1 million in short-term borrowings outstanding at September 30, 2025 compared to $7.0 million at December 31, 2024. The short-term borrowings at September 30, 2025 and December 31, 2024 were comprised of repurchase agreements.

First Guaranty had long-term borrowings from the FHLB that totaled $135.0 million at September 30, 2025 and December 31, 2024. First Guaranty converted previous short-term floating rate borrowings from the FHLB into long-term lower fixed rate borrowings in order to reduce interest expense. First Guaranty has a $100.0 million FHLB advance that matures in the second quarter of 2027, and a $35.0 million FHLB advance that matures in the third quarter of 2027.

First Guaranty had senior long-term debt totaling $14.2 million as of September 30, 2025 and $15.2 million at December 31, 2024.
 
First Guaranty had subordinated debt totaling $29.8 million at September 30, 2025 and $44.7 million at December 31, 2024.

First Guaranty had $426.2 million in Federal Home Loan Bank letters of credit as of September 30, 2025 compared to $455.7 million at December 31, 2024. Federal Home Loan Bank letters of credit are obtained primarily for collateralizing public deposits.

Total Shareholders' Equity
 
Total shareholders' equity decreased to $221.1 million at September 30, 2025 from $255.0 million at December 31, 2024. The decrease in shareholders' equity was principally the result of a decrease of $60.6 million in retained earnings, partially offset by an increase of $19.3 million in surplus, a decrease of $4.5 million in accumulated other comprehensive loss, and an increase of $2.8 million in common stock. The $60.6 million decrease in retained earnings was primarily due to net loss of $58.5 million during the nine months ended September 30, 2025, $0.4 million in cash dividends paid on shares of our common stock and $1.7 million in cash dividends paid on shares of our preferred stock. The $19.3 million increase in surplus and $2.8 million increase in common stock was primarily due to the conversion of $15.0 million in subordinated debt and the issuance of common stock under private placement during the first nine months of 2025. The decrease in accumulated other comprehensive loss was primarily attributed to the decrease in unrealized losses on available for sale securities during the nine months ended September 30, 2025.
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Results of Operations for the Third Quarter Ended September 30, 2025 and 2024
 
Performance Summary

Three months ended September 30, 2025 compared to the three months ended September 30, 2024. Net loss for the three months ended September 30, 2025 was $45.0 million, a decrease of $46.9 million, from net income of $1.9 million for the three months ended September 30, 2024. The decrease in net income for the three months ended September 30, 2025 as compared to the prior year period was primarily the result of the provision to the credit allowance, the goodwill impairment charge, and a decrease in noninterest income. The increase in the provision for credit losses was related to changes within the portfolio, loan sales and charge-offs experienced in the third quarter. $39.8 million of the $47.9 million provision was associated with one commercial lease relationship. First Guaranty has a $52.0 million credit exposure associated with commercial lease financing to entities related to an auto parts manufacturer that declared Chapter 11 bankruptcy during the third quarter. The credit exposure consists of one $17.2 million commercial lease, which was past due on its payments and placed on nonaccrual as of September 30, 2025, and three commercial leases totaling $34.8 million that were current on payments and remained on accrual status as of September 30, 2025. First Guaranty has downgraded all four lease credits to substandard and impaired status. A specific reserve of $17.2 million has been established for the nonaccrual credit and a specific reserve of $22.6 million has been established for the three lease credits that remain on accrual status. The commercial leases are serviced by a third party. The decrease in noninterest income was related to the net gains on sale of assets related to the sale-leaseback transaction from the prior year. Loan interest income decreased primarily due to the decrease in First Guaranty's loan portfolio. Securities interest income increased due to an increase in the average balance and average yield of the investment portfolio. Noninterest expense increased primarily due to the goodwill impairment charge of $12.9 million during the third quarter of 2025. Loss per common share for the three months ended September 30, 2025 was $(3.01) per common share, a decrease of $3.12 per common share from $0.11 per common share for the three months ended September 30, 2024.

Nine months ended September 30, 2025 compared to the nine months ended September 30, 2024. Net loss for the nine months ended September 30, 2025 was $58.5 million, a decrease of $69.9 million, from net income of $11.4 million for the nine months ended September 30, 2024. The decrease in net income for the nine months ended September 30, 2025 as compared to the prior year period was primarily the result of the provision to the credit allowance, the goodwill impairment charge, and a decrease in noninterest income. The increase in the provision for credit losses was related to changes within the portfolio, loan sales and charge-offs experienced in 2025. $39.8 million of the $79.1 million provision for the year was associated with one commercial lease relationship, as discussed above. The decrease in noninterest income was related to the decrease of net gains on sale of assets related to the sale-leaseback transaction from the prior year. Loan interest income decreased primarily due to the decrease in First Guaranty's loan portfolio. Securities interest income increased due to an increase in the average balance and average yield of the investment portfolio. Noninterest expense increased primarily due to the goodwill impairment charge of $12.9 million during the third quarter of 2025. Loss per common share for the nine months ended September 30, 2025 was $(4.45) per common share, a decrease of $5.23 per common share from $0.78 per common share for the nine months ended September 30, 2024.


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Net Interest Income
 
Our operating results depend primarily on our net interest income, which is the difference between interest income earned on interest-earning assets, including loans and securities, and interest expense incurred on interest-bearing liabilities, including deposits and other borrowed funds. Interest rate fluctuations, as well as changes in the amount and type of interest-earning assets and interest-bearing liabilities, combine to affect net interest income. First Guaranty’s assets and liabilities are generally most affected by changes in the Federal Funds rate, SOFR rate, short-term Treasury rates such as one month and three month Treasury bills, and longer term Treasury rates such as the U.S. ten year Treasury rate. Our net interest income is affected by changes in the amount and mix of interest-earning assets and interest-bearing liabilities. There may also be a time lag in the effect of interest rate changes on assets and liabilities. It is also affected by changes in yields earned on interest-earning assets and rates paid on interest-bearing deposits and other borrowed funds.
 
A financial institution's asset and liability structure is substantially different from that of a non-financial company, in that virtually all assets and liabilities are monetary in nature. Accordingly, changes in interest rates may have a significant impact on a financial institution's performance. The impact of interest rate changes depends on the sensitivity to the change of our interest-earning assets and interest-bearing liabilities. The effects of the changing interest rate environment in recent periods and our interest sensitivity position is discussed below.

Three months ended September 30, 2025 compared to the three months ended September 30, 2024. Net interest income for the three months ended September 30, 2025 and 2024 was $22.2 million and $22.7 million, respectively. The decrease in net interest income for the three months ended September 30, 2025 as compared to the prior year period was primarily due to a decrease in the average rate of our total interest-bearing assets. For the three months ended September 30, 2025, the average balance of our total interest-earning assets increased by $164.2 million to $3.8 billion due to growth in the securities portfolio and an increase in interest-earning deposits with banks. The average yield of our interest-earning assets decreased by 71 basis points to 5.63% for the three months ended September 30, 2025 from 6.34% for the three months ended September 30, 2024 primarily due to a lower yield on interest-earning deposits with banks. For the three months ended September 30, 2025, the average balance of our total interest-bearing liabilities increased by $119.4 million to $3.2 billion primarily due to growth in interest-bearing deposits. The average rate of our total interest-bearing liabilities decreased by 62 basis points to 3.92% for the three months ended September 30, 2025 from 4.54% for the three months ended September 30, 2024. The primary source of the decrease in liabilities cost was associated with the repricing of interest bearing demand deposits for public funds that are primarily indexed to Treasury rates. As a result, our net interest rate spread decreased 9 basis points to 1.71% for the three months ended September 30, 2025 from 1.80% for the three months ended September 30, 2024. Our net interest margin decreased 17 basis points to 2.34% for the three months ended September 30, 2025 from 2.51% for the three months ended September 30, 2024.

Nine months ended September 30, 2025 compared to the nine months ended September 30, 2024. Net interest income for the nine months ended September 30, 2025 and 2024 was $66.7 million and $65.9 million, respectively. The increase in net interest income for the nine months ended September 30, 2025 as compared to the prior year period was primarily due to an increase in the average balance of our total interest-earning assets, partially offset by a decrease in the average yield of our total interest-earning assets and an increase in the average balance of our total interest-bearing liabilities. For the nine months ended September 30, 2025, the average balance of our total interest-earning assets increased by $312.8 million to $3.8 billion due to growth in the securities portfolio and an increase in interest-earning deposits with banks. The average yield of our interest-earning assets decreased by 57 basis points to 5.71% for the nine months ended September 30, 2025 from 6.28% for the nine months ended September 30, 2024 primarily due to a lower yield on interest-earning deposits with banks. For the nine months ended September 30, 2025, the average balance of our total interest-bearing liabilities increased by $290.2 million to $3.2 billion primarily due to growth in interest-bearing deposits. The average rate of our total interest-bearing liabilities decreased by 51 basis points to 3.98% for the nine months ended September 30, 2025 from 4.49% for the nine months ended September 30, 2024. The primary source of the decrease in liabilities cost was associated with the repricing of interest bearing demand deposits for public funds that are primarily indexed to Treasury rates. As a result, our net interest rate spread decreased 6 basis points to 1.73% for the nine months ended September 30, 2025 from 1.79% for the nine months ended September 30, 2024. Our net interest margin decreased 17 basis points to 2.35% for the nine months ended September 30, 2025 from 2.52% for the nine months ended September 30, 2024.


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Interest Income

Three months ended September 30, 2025 compared to the three months ended September 30, 2024. Interest income decreased $3.9 million, or 6.8%, to $53.5 million for the three months ended September 30, 2025 as compared to the prior year period. The decrease in interest income was attributable to a $464.7 million decrease in the average balance of loans, along with a 40 basis point decrease in yield of loans. The average balance of our total interest-earning assets, primarily associated with securities and interest-earning deposits with banks, increased, partially offset by the decrease in the average yield of interest-earning assets. The average balance of our interest-earning assets increased $164.2 million to $3.8 billion for the three months ended September 30, 2025 as compared to the same period in the prior year. The average yield of interest-earning assets decreased by 71 basis points to 5.63% for the three months ended September 30, 2025 compared to 6.34% for the three months ended September 30, 2024.

Interest income on securities increased $3.4 million to $6.4 million for the three months ended September 30, 2025 as compared to the prior year period primarily as a result of an increase in average balance and average yield of securities. The average balance of securities increased $297.8 million to $722.4 million for the three months ended September 30, 2025 from $424.6 million for the three months ended September 30, 2024 primarily due to a increase in the average balance of our mortgage-backed securities and collateralized mortgage obligations securities portfolio compared to the prior year. The average yield on securities increased 73 basis points to 3.51% for the three months ended September 30, 2025 compared to 2.78% for the three months ended September 30, 2024 due to the increase in higher yielding securities.

Interest income on loans decreased $10.5 million or 21.1%, to $39.3 million for the three months ended September 30, 2025 as compared to the prior year period as a result of a decrease in the average balance and average yield of loans. The average balance of loans (excluding loans held for sale) decreased by $464.7 million to $2.3 billion for the three months ended September 30, 2025 from $2.8 billion for the three months ended September 30, 2024 largely as a result of loan sales and payoffs on the portfolio. The average yield on loans (excluding loans held for sale) decreased by 40 basis points to 6.65% for the three months ended September 30, 2025 from 7.05% for the three months ended September 30, 2024.

Interest income on interest-earning deposits with banks increased $3.1 million to $7.8 million for the three months ended September 30, 2025 as compared to the prior year period as a result of an increase in the average balance of interest-bearing deposits with banks. The average balance of interest-bearing deposits with banks increased $332.8 million to $697.3 million for the three months ended September 30, 2025 from $364.5 million for the three months ended September 30, 2024. This was partially offset by a decrease in the yield on interest-earning deposits of 65 basis points.

Nine months ended September 30, 2025 compared to the nine months ended September 30, 2024. Interest income decreased $1.7 million, or 1.0%, to $162.3 million for the nine months ended September 30, 2025 as compared to the prior year period. The decrease in interest income was attributable to a $317.3 million decrease in the average balance of loans, along with a 24 basis point decrease in yield of loans. The average balance of our total interest-earning assets, primarily associated with securities and interest-earning deposits with banks, increased, partially offset by the decrease in the average yield of interest-earning assets. The average balance of our interest-earning assets increased $312.8 million to $3.8 billion for the nine months ended September 30, 2025 as compared to the same period in the prior year. The average yield of interest-earning assets decreased by 57 basis points to 5.71% for the nine months ended September 30, 2025 compared to 6.28% for the nine months ended September 30, 2024.

Interest income on securities increased $9.7 million to $17.7 million for the nine months ended September 30, 2025 as compared to the prior year period primarily as a result of an increase in average balance and average yield of securities. The average balance of securities increased $287.9 million to $683.9 million for the nine months ended September 30, 2025 from $396.0 million for the nine months ended September 30, 2024 primarily due to a increase in the average balance of our mortgage-backed securities and collateralized mortgage obligations securities portfolio compared to the prior year. The average yield on securities increased 78 basis points to 3.46% for the nine months ended September 30, 2025 compared to 2.68% for the nine months ended September 30, 2024 due to the increase in higher yielding securities.

Interest income on loans decreased $21.0 million or 14.5%, to $123.3 million for the nine months ended September 30, 2025 as compared to the prior year period as a result of a decrease in the average balance and average yield of loans. The average balance of loans (excluding loans held for sale) decreased by $317.3 million to $2.5 billion for the nine months ended September 30, 2025 from $2.8 billion for the nine months ended September 30, 2024 largely as a result of loan sales and payoffs on the portfolio. The average yield on loans (excluding loans held for sale) decreased by 24 basis points to 6.66% for the nine months ended September 30, 2025 from 6.90% for the nine months ended September 30, 2024. Nonaccrual loans were $114.3 million at September 30, 2025 compared to $108.5 million at December 31, 2024.

Interest income on interest-earning deposits with banks increased $9.5 million to $21.3 million for the nine months ended September 30, 2025 as compared to the prior year period as a result of an increase in the average balance of interest-bearing deposits with banks. The average balance of interest-bearing deposits with banks increased $341.5 million to $641.0 million for the nine months ended September 30, 2025 from $299.4 million for the nine months ended September 30, 2024. This was partially offset by a decrease in the yield on interest-earning deposits of 80 basis points.


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Interest Expense

Three months ended September 30, 2025 compared to the three months ended September 30, 2024. Interest expense decreased $3.5 million, or 10.0%, to $31.3 million for the three months ended September 30, 2025 from $34.7 million for the three months ended September 30, 2024 due primarily to a decrease on the average rate of interest-bearing deposits, partially offset by an increase in the average balance of interest-bearing liabilities. The average rate of interest-bearing demand deposits was 3.74% for the three months ended September 30, 2025 and 4.50% for the three months ended September 30, 2024. The decrease in market interest rates, particularly U.S. Treasury rates, contributed to the decrease in rates paid on interest-bearing demand deposits. The largest concentration of interest-bearing demand deposits is associated with public funds deposits that are primarily indexed to Treasury rates. The average rate of time deposits decreased 62 basis points during the three months ended September 30, 2025 to 4.23% as compared to the prior year period. The decrease in the average rate of time deposits was due to changes in market rates as existing time deposits repriced. The average balance of interest-bearing liabilities increased by $119.4 million during the three months ended September 30, 2025 to $3.2 billion as compared to the prior year period. This increase was a result of a $326.2 million increase in the average balance of time deposits, offset by a $100.2 million decrease in the average balance of interest-bearing demand deposits, $20.7 million decrease in the average balance of savings deposits, and a $85.9 million decrease in the average balance of borrowings.

Nine months ended September 30, 2025 compared to the nine months ended September 30, 2024. Interest expense decreased $2.5 million, or 2.6%, to $95.6 million for the nine months ended September 30, 2025 from $98.1 million for the nine months ended September 30, 2024 due primarily to a decrease on the average rate of interest-bearing deposits, partially offset by an increase in the average balance of interest-bearing liabilities. The average balance of interest-bearing liabilities increased by $290.2 million during the nine months ended September 30, 2025 to $3.2 billion as compared to the prior year period. This increase was a result of a $1.4 million increase in the average balance of savings deposits, a $478.5 million increase in the average balance of time deposits, partially offset by a $139.5 million decrease in the average balance of interest-bearing demand deposits and a $50.2 million decrease in the average balance of borrowings. The average rate of interest-bearing demand deposits was 3.69% for the nine months ended September 30, 2025 and 4.48% for the nine months ended September 30, 2024. The decrease in market interest rates, particularly U.S. Treasury rates, contributed to the decrease in rates paid on interest-bearing demand deposits. The largest concentration of interest-bearing demand deposits is associated with public funds deposits that are primarily indexed to Treasury rates. The average rate of time deposits decreased 38 basis points during the nine months ended September 30, 2025 to 4.34% as compared to the prior year period. The decrease in the average rate of time deposits was due to changes in market rates as existing time deposits repriced.

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The following tables set forth average balance sheets, average yields and costs, and certain other information for the periods indicated. No tax-equivalent yield adjustments were made, as the effect thereof was not material. All average balances are daily average balances. Non-accrual loans were included in the computation of average balances but have been reflected in the tables as loans carrying a zero yield. The yields set forth below include the effect of deferred fees, discounts and premiums that are amortized or accreted to interest income or expense.

The net interest income yield shown below in the average balance sheet is calculated by dividing net interest income by average interest-earning assets and is a measure of the efficiency of the earnings from balance sheet activities. It is affected by changes in the difference between interest on interest-earning assets and interest-bearing liabilities and the percentage of interest-earning assets funded by interest-bearing liabilities. 

Three Months Ended September 30, 2025 Three Months Ended September 30, 2024
(in thousands except for %) Average Balance Interest Yield/Rate (5) Average Balance Interest Yield/Rate (5)
Assets
Interest-earning assets:
Interest-earning deposits with banks $ 697,288  $ 7,777  4.42  % $ 364,538  $ 4,645  5.07  %
Securities (including FHLB stock) 722,380  6,398  3.51  % 424,620  2,971  2.78  %
Federal funds sold 556  —  —  % 2,211  —  —  %
Loans held for sale —  —  —  % —  —  —  %
Loans, net of unearned income(6) 2,346,551  39,325  6.65  % 2,811,227  49,811  7.05  %
Total interest-earning assets 3,766,775  $ 53,500  5.63  % 3,602,596  $ 57,427  6.34  %
Noninterest-earning assets:
Cash and due from banks 21,031  19,021 
Premises and equipment, net 65,039  68,974 
Other assets 19,419  35,860 
Total Assets $ 3,872,264  $ 3,726,451 
Liabilities and Shareholders' Equity
Interest-bearing liabilities:
Demand deposits $ 1,399,102  $ 13,185  3.74  % $ 1,499,327  $ 16,957  4.50  %
Savings deposits 213,383  1,058  1.97  % 234,118  1,374  2.33  %
Time deposits 1,362,955  14,519  4.23  % 1,036,757  12,631  4.85  %
Borrowings 186,087  2,500  5.33  % 271,954  3,767  5.51  %
Total interest-bearing liabilities 3,161,527  $ 31,262  3.92  % 3,042,156  $ 34,729  4.54  %
Noninterest-bearing liabilities:
Demand deposits 405,479  408,383 
Other 41,541  19,562 
Total Liabilities 3,608,547  3,470,101 
Shareholders' equity 263,717  256,350 
Total Liabilities and Shareholders' Equity $ 3,872,264  $ 3,726,451 
Net interest income $ 22,238  $ 22,698 
Net interest rate spread (1) 1.71  % 1.80  %
Net interest-earning assets (2) $ 605,248  $ 560,440 
Net interest margin (3), (4) 2.34  % 2.51  %
Average interest-earning assets to interest-bearing liabilities 119.14  % 118.42  %
(1)Net interest rate spread represents the difference between the yield on average interest-earning assets and the cost of average interest-bearing liabilities.
(2)Net interest-earning assets represents total interest-earning assets less total interest-bearing liabilities.
(3)Net interest margin represents net interest income divided by average total interest-earning assets.
(4)The tax adjusted net interest margin was 2.35% and 2.51% for the above periods ended September 30, 2025 and 2024, respectively. A 21% tax rate was used to calculate the effect on securities income from tax exempt securities for the above periods ended September 30, 2025 and 2024, respectively.
(5)Annualized.
(6)Includes loan fees of $1.0 million and $1.5 million for the three months ended September 30, 2025 and 2024, respectively.

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Nine Months Ended September 30, 2025 Nine Months Ended September 30, 2024
(in thousands except for %) Average Balance Interest Yield/Rate (5) Average Balance Interest Yield/Rate (5)
Assets
Interest-earning assets:
Interest-earning deposits with banks $ 640,961  $ 21,287  4.44  % $ 299,449  $ 11,747  5.24  %
Securities (including FHLB stock) 683,930  17,690  3.46  % 396,025  7,958  2.68  %
Federal funds sold 534  —  —  % 1,060  —  —  %
Loans held for sale 1,131  —  —  % —  —  —  %
Loans, net of unearned income(6) 2,476,128  123,307  6.66  % 2,793,397  144,281  6.90  %
Total interest-earning assets 3,802,684  $ 162,284  5.71  % 3,489,931  $ 163,986  6.28  %
Noninterest-earning assets:
Cash and due from banks 20,691  19,439 
Premises and equipment, net 66,041  69,951 
Other assets 24,342  31,144 
Total Assets $ 3,913,758  $ 3,610,465 
Liabilities and Shareholders' Equity
Interest-bearing liabilities:
Demand deposits $ 1,380,225  $ 38,097  3.69  % $ 1,519,743  $ 50,992  4.48  %
Savings deposits 231,206  3,656  2.11  % 229,763  3,928  2.28  %
Time deposits 1,403,370  45,605  4.34  % 924,857  32,649  4.72  %
Borrowings 196,267  8,225  5.60  % 246,502  10,556  5.72  %
Total interest-bearing liabilities 3,211,068  $ 95,583  3.98  % 2,920,865  $ 98,125  4.49  %
Noninterest-bearing liabilities:
Demand deposits 404,640  416,389 
Other 40,306  19,636 
Total Liabilities 3,656,014  3,356,890 
Shareholders' equity 257,744  253,575 
Total Liabilities and Shareholders' Equity $ 3,913,758  $ 3,610,465 
Net interest income $ 66,701  $ 65,861 
Net interest rate spread (1) 1.73  % 1.79  %
Net interest-earning assets (2) $ 591,616  $ 569,066 
Net interest margin (3), (4) 2.35  % 2.52  %
Average interest-earning assets to interest-bearing liabilities 118.42  % 119.48  %
(1)Net interest rate spread represents the difference between the yield on average interest-earning assets and the cost of average interest-bearing liabilities.
(2)Net interest-earning assets represents total interest-earning assets less total interest-bearing liabilities.
(3)Net interest margin represents net interest income divided by average total interest-earning assets.
(4)The tax adjusted net interest margin was 2.35% and 2.53% for the above periods ended September 30, 2025 and 2024, respectively. A 21% tax rate was used to calculate the effect on securities income from tax exempt securities for the above periods ended September 30, 2025 and 2024, respectively.
(5)Annualized.
(6)Includes loan fees of $3.9 million and $5.5 million for the nine months ended September 30, 2025 and 2024, respectively.


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Provision for Credit Losses
 
A provision for credit losses is a charge to income in an amount that management believes is necessary to maintain an adequate allowance for credit losses. The allowance for loan losses is calculated under ASC 326 and is management's evaluation of expected credit losses over the life of the loans in the portfolio. The provision is based on management's regular evaluation of current economic conditions in our specific markets as well as regionally and nationally, changes in the character and size of the loan portfolio, underlying collateral values securing loans, and other factors which deserve recognition in estimating loan losses. Past events, current conditions, and reasonable forecasts, along with quantitative and qualitative adjustments, are used in calculating the allowance for credit losses. This evaluation is inherently subjective as it requires estimates that are susceptible to significant revision as more information becomes available or as future events change.

For the three months ended September 30, 2025, the provision for credit losses was $47.9 million compared to $4.9 million for the same period in 2024. The increase in the provision was primarily impacted by the $39.8 million reserve associated with one commercial lease relationship. First Guaranty has a $52.0 million credit exposure associated with commercial lease financing to entities related to an auto parts manufacturer that declared Chapter 11 bankruptcy during the third quarter. The credit exposure consists of one $17.2 million commercial lease, which was past due on its payments and placed on nonaccrual as of September 30, 2025, and three commercial leases totaling $34.8 million that were current on payments and remained on accrual status as of September 30, 2025. First Guaranty has downgraded all four lease credits to substandard and impaired status. A specific reserve of $17.2 million has been established for the nonaccrual credit and a specific reserve of $22.6 million has been established for the three lease credits that remain on accrual status. The commercial leases are serviced by a third party. Total charge-offs were $21.3 million for the three months ended September 30, 2025 and $2.6 million for the same period in 2024. Charge-offs for the three months ended September 30, 2025 were concentrated with two commercial real estate credits charge-offs of $9.4 million on an independent living center located in Louisiana and $10.4 million on an apartment complex located in Texas. Partially offsetting these charge-offs were recoveries that totaled $0.3 million for the three months ended September 30, 2025 and $0.2 million for the same period in 2024.

For the nine months ended September 30, 2025, the provision for credit losses was $79.1 million compared to $14.0 million for the same period in 2024. The $79.1 million provision included a $0.5 million negative provision for credit losses related to unfunded commitments. The increase in the provision was primarily impacted by the $39.8 million reserve associated with one commercial lease relationship, as discussed above. Total charge-offs were $29.4 million for the nine months ended September 30, 2025 and $13.7 million for the same period in 2024. Charge-offs for the nine months ended September 30, 2025 were concentrated in one commercial and industrial loan, one multifamily loan, one non-farm non-residential loan, a one-to-four family loan, two lease loan relationships, consumer loans and two construction and land development loans, both were subsequently sold during the first quarter of 2025. Partially offsetting these charge-offs were recoveries that totaled $0.7 million for the nine months ended September 30, 2025 and $0.7 million for the same period in 2024.

We believe that the allowance is adequate to cover current expected losses in the loan portfolio given the current economic conditions, and current expected net charge-offs and nonperforming asset levels. Economic uncertainty may result in additional increases to the allowance for credit losses in future periods.
There was no provision for credit losses on AFS or HTM securities in the nine months ended September 30, 2025 and 2024.
Noninterest Income
 
Our primary sources of recurring noninterest income are customer service fees, ATM and debit card fees, loan fees, gains on the sales of loans and available for sale securities and other service fees. Noninterest income does not include loan origination fees which are recognized over the life of the related loan as an adjustment to yield using the interest method.

Noninterest income totaled $1.9 million for the three months ended September 30, 2025, a decrease of $2.5 million from $4.4 million for the three months ended September 30, 2024. The decrease was primarily due to a decrease in gains on the sale of loans. Service charges, commissions and fees totaled $0.8 million for the three months ended September 30, 2025 and $0.8 million for the same period in 2024. ATM and debit card fees totaled $0.7 million for the three months ended September 30, 2025 and $0.8 million for the same period in 2024. There were no net securities losses for the three months ended September 30, 2025 and 2024. There were no net gains on the sale of loans for the three months ended September 30, 2025 and $1.5 million for the same period in 2024. Net (losses) gains on the sale of assets were $(0.4) million for the three months ended September 30, 2025 compared to $31,000 for the same period in 2024. Other noninterest income totaled $0.7 million for the three months ended September 30, 2025 and $1.3 million for the same period in 2024.

Noninterest income totaled $6.4 million for the nine months ended September 30, 2025, a decrease of $15.9 million from $22.2 million for the nine months ended September 30, 2024. The decrease was primarily due to gains on the sale of assets associated with the sale-leaseback transaction during the second quarter of 2024. Service charges, commissions and fees totaled $2.5 million for the nine months ended September 30, 2025 and $2.3 million for the same period in 2024. ATM and debit card fees totaled $2.3 million for the nine months ended September 30, 2025 and $2.4 million for the same period in 2024. There were no net securities losses for the nine months ended September 30, 2025 and 2024. There were no gains on the sale of loans for the nine months ended September 30, 2025 and $1.5 million for the same period in 2024. Net (losses) gains on the sale of assets were $(0.4) million for the nine months ended September 30, 2025 compared to $13.2 million for the same period in 2024. Other noninterest income totaled $2.0 million for the nine months ended September 30, 2025 and $2.8 million for the same period in 2024.

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Noninterest Expense
 
Noninterest expense includes salaries and employee benefits, occupancy and equipment expense and other types of expenses. Noninterest expense totaled $30.2 million for the three months ended September 30, 2025 (including $12.9 million of goodwill impairment) and $19.7 million for the three months ended September 30, 2024. Salaries and benefits expense totaled $7.5 million for the three months ended September 30, 2025 and $10.1 million for the three months ended September 30, 2024. Occupancy and equipment expense totaled $2.6 million for the three months ended September 30, 2025 and $2.5 million for the same period in 2024. First Guaranty recognized a one-time non-cash impairment charge to goodwill of $12.9 million during the third quarter of 2025. Other noninterest expense totaled $7.2 million for the three months ended September 30, 2025 and $7.1 million for the same period in 2024.

Noninterest expense totaled $65.5 million for the nine months ended September 30, 2025 (including $12.9 million of goodwill impairment) and $59.2 million for the nine months ended September 30, 2024. Salaries and benefits expense totaled $23.7 million for the nine months ended September 30, 2025 and $30.4 million for the nine months ended September 30, 2024. Occupancy and equipment expense totaled $7.9 million for the nine months ended September 30, 2025 and $7.4 million for the same period in 2024. Other noninterest expense totaled $21.0 million for the nine months ended September 30, 2025 and $21.5 million for the same period in 2024.

The following table presents, for the periods indicated, the major categories of other noninterest expense:

  Three Months Ended September 30, Nine Months Ended September 30,
(in thousands) 2025 2024 2025 2024
Other noninterest expense:    
Legal and professional fees $ 988  $ 625  $ 2,747  $ 3,102 
Data processing 336  413  1,022  1,196 
ATM fees 390  424  1,242  1,237 
Marketing and public relations 151  296  555  999 
Taxes - sales, capital, and franchise 542  678  1,585  1,890 
Operating supplies 66  41  152  247 
Software expense and amortization 1,211  1,203  3,615  3,824 
Travel and lodging 88  112  286  599 
Telephone 88  135  283  378 
Amortization of core deposit intangibles 174  174  522  522 
Donations 51  58  191  241 
Net costs from other real estate and repossessions 13  150  87  533 
Regulatory assessment 1,777  1,182  4,930  3,105 
Other 1,330  1,579  3,743  3,582 
Total other noninterest expense $ 7,205  $ 7,070  $ 20,960  $ 21,455 
Income Taxes
 
The amount of income tax expense is influenced by the amount of pre-tax income, the amount of tax-exempt income and the amount of other non-deductible expenses and the statutory tax rate. The benefit for income taxes for the three months ended September 30, 2025 was $9.0 million compared to a provision of $0.6 million for the same period in 2024. The provision for income taxes decreased due to a decrease in income before income taxes. First Guaranty's statutory tax rate was 21.0% for the three months ended September 30, 2025 and 2024.

The benefit for income taxes for the nine months ended September 30, 2025 was $13.0 million compared to a provision of $3.4 million for the same period in 2024. The provision for income taxes decreased due to a decrease in income before income taxes. First Guaranty's statutory tax rate was 21.0% for the nine months ended September 30, 2025 and 2024.











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Liquidity and Capital Resources
 
Liquidity
 
Liquidity refers to the ability or flexibility to manage future cash flows to meet the needs of depositors and borrowers and fund operations. Maintaining appropriate levels of liquidity allows us to have sufficient funds available to meet customer demand for loans, withdrawal of deposit balances and maturities of deposits and other liabilities. Liquid assets include cash and due from banks, interest-earning demand deposits with banks, federal funds sold and available for sale investment securities.

First Guaranty's cash and cash equivalents totaled $754.2 million at September 30, 2025 compared to $564.2 million at December 31, 2024. Loans maturing within one year or less at September 30, 2025 totaled $517.9 million compared to $486.0 million at December 31, 2024. At September 30, 2025, time deposits maturing within one year or less totaled $908.7 million compared to $804.1 million at December 31, 2024. Time deposits maturing after one year through three years totaled $358.0 million at September 30, 2025 compared to $489.6 million at December 31, 2024. Time deposits maturing after three years totaled $85.9 million at September 30, 2025 compared to $157.0 million at December 31, 2024. First Guaranty's held to maturity ("HTM") securities portfolio at September 30, 2025 was $322.4 million, or 46.3% of the investment portfolio, compared to $321.6 million, or 53.4% at December 31, 2024. First Guaranty's available for sale ("AFS") securities portfolio was $374.3 million, or 53.7% of the investment portfolio as of September 30, 2025 compared to $281.1 million, or 46.6% of the investment portfolio at December 31, 2024. The majority of the AFS portfolio was comprised of corporate debt securities, municipal bonds, collateralized mortgage obligations and mortgage-backed securities.
 
First Guaranty maintained a net borrowing capacity at the Federal Home Loan Bank totaling $185.4 million and $339.2 million at September 30, 2025 and December 31, 2024, respectively with $135.0 million in FHLB advances outstanding at September 30, 2025 and December 31, 2024. The advances outstanding at September 30, 2025 and December 31, 2024 were comprised of two long-term advances that totaled $135.0 million. The change in borrowing capacity with the Federal Home Loan Bank was due to changes in the value that First Guaranty receives on pledged collateral and due to First Guaranty's usage of the line. First Guaranty has increasingly transitioned public funds deposits into reciprocal deposit programs for collateralization as an alternative to FHLB letters of credit. We also maintain federal funds lines of credit at various correspondent banks with borrowing capacity of $93.0 million as of September 30, 2025. We also have a discount window line with the Federal Reserve Bank that totaled $214.3 million at September 30, 2025 which was a decrease of $36.1 million compared to availability of $250.4 million at December 31, 2024. First Guaranty did not have any advances under this facility at September 30, 2025. Management believes there is sufficient liquidity to satisfy current operating needs.
 
Capital Resources
 
First Guaranty's capital position is reflected in shareholders' equity, subject to certain adjustments for regulatory purposes. Further, our capital base allows us to take advantage of business opportunities while maintaining the level of resources we deem appropriate to address business risks inherent in daily operations.

Total shareholders' equity decreased to $221.1 million at September 30, 2025 from $255.0 million at December 31, 2024. The decrease in shareholders' equity was principally the result of a decrease of $60.6 million in retained earnings, partially offset by an increase of $19.3 million in surplus, a decrease of $4.5 million in accumulated other comprehensive loss, and an increase of $2.8 million in common stock. The $60.6 million decrease in retained earnings was primarily due to net loss of $58.5 million during the nine months ended September 30, 2025, $0.4 million in cash dividends paid on shares of our common stock and $1.7 million in cash dividends paid on shares of our preferred stock. The $19.3 million increase in surplus and $2.8 million increase in common stock was primarily due to the conversion of $15.0 million in subordinated debt and the issuance of common stock under private placement during the first nine months of 2025. The decrease in accumulated other comprehensive loss was primarily attributed to the decrease in unrealized losses on available for sale securities during the nine months ended September 30, 2025.
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Regulatory Capital
 
Risk-based capital regulations adopted by the FDIC require banks to achieve and maintain specified ratios of capital to risk-weighted assets. Similar capital regulations apply to bank holding companies over $3.0 billion in assets. The risk-based capital rules are designed to measure "Tier 1" capital (consisting of common equity, retained earnings and a limited amount of qualifying perpetual preferred stock and trust preferred securities, net of goodwill and other intangible assets and accumulated other comprehensive income) and total capital in relation to the credit risk of both on- and off- balance sheet items. Under the guidelines, one of its risk weights is applied to the different on-balance sheet items. Off-balance sheet items, such as loan commitments, are also subject to risk weighting. Applicable bank holding companies and all banks must maintain a minimum total capital to total risk weighted assets ratio of 8.00%, at least half of which must be in the form of core or Tier 1 capital. These guidelines also specify that bank holding companies that are experiencing internal growth or making acquisitions will be expected to maintain capital positions substantially above the minimum supervisory levels.
 
In order to avoid limitations on distributions, including dividend payments, and certain discretionary bonus payments to executive officers, an institution must hold a capital conservation buffer above its minimum risk-based capital requirements. As of September 30, 2025, the Bank's capital conservation buffer was 4.34% exceeding the minimum of 2.50%. As of September 30, 2025, First Guaranty's capital conservation buffer was 3.49% exceeding the minimum of 2.50%.

As a result of the Economic Growth, Regulatory Relief, and Consumer Protection Act, the Federal Reserve Board has amended its small bank holding company and savings and loan holding company policy statement to provide that holding companies with consolidated assets of less than $3 billion that are (i) not engaged in significant nonbanking activities, (ii) do not conduct significant off-balance sheet activities, and (3) do not have a material amount of SEC-registered debt or equity securities, other than trust preferred securities, that contribute to an organization's complexity, are no longer subject to regulatory capital requirements, effective August 30, 2018. On January 1, 2024, First Guaranty ceased being considered a "small bank holding company". Accordingly, both the Bank and First Guaranty are required to maintain specified ratios of capital to risk-weighted assets.

In addition, as a result of the legislation, the federal banking agencies have developed a "Community Bank Leverage Ratio" (the ratio of a bank's Tier 1 capital to average total consolidated assets) for financial institutions with assets of less than $10 billion.  A "qualifying community bank" that exceeds this ratio will be deemed to be in compliance with all other capital and leverage requirements, including the capital requirements to be considered "well capitalized" under Prompt Corrective Action statutes. The federal banking agencies may consider a financial institution's risk profile when evaluating whether it qualifies as a community bank for purposes of the capital ratio requirement. The federal banking agencies set the new Community Bank Leverage Ratio at 9%. Pursuant to the CARES Act, the federal banking agencies set the Community Bank Leverage Ratio at 8% beginning in the second quarter of 2020 through the end of 2020. Beginning in 2021, the Community Bank Leverage Ratio increased to 8.5% for the calendar year. Community banks will have until January 1, 2022, before the Community Bank Leverage Ratio requirement will return to 9%. A financial institution can elect to be subject to this new definition. As of September 30, 2025, the Bank has not elected to follow the Community Bank Leverage Ratio.

At September 30, 2025, we satisfied the minimum regulatory capital requirements and were well capitalized within the meaning of federal regulatory requirements. 
  "Well Capitalized Minimums" As of September 30, 2025 As of December 31, 2024
Tier 1 Leverage Ratio      
Bank 5.00  % 6.92  % 7.82  %
Consolidated 5.00  % 5.91  % 6.42  %
Tier 1 Risk-based Capital Ratio
Bank 8.00  % 11.09  % 11.00  %
Consolidated 8.00  % 9.48  % 9.04  %
Total Risk-based Capital Ratio
Bank 10.00  % 12.34  % 12.11  %
Consolidated 10.00  % 11.97  % 11.73  %
Common Equity Tier One Capital Ratio
Bank 6.50  % 11.09  % 11.00  %
Consolidated 6.50  % 8.11  % 7.87  %













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Item 3. Quantitative and Qualitative Disclosures about Market Risk
 
Asset/Liability Management and Market Risk
 
Our asset/liability management (ALM) process consists of quantifying, analyzing and controlling interest rate risk (IRR) to maintain reasonably stable net interest income levels under various interest rate environments. The principal objective of ALM is to maximize net interest income while operating within acceptable limits established for interest rate risk and to maintain adequate levels of liquidity.
 
The majority of our assets and liabilities are monetary in nature. Consequently, one of our most significant forms of market risk is interest rate risk, which is inherent in our lending and deposit-taking activities. Our assets, consisting primarily of loans secured by real estate and fixed rate securities in our investment portfolio, have longer maturities than our liabilities, consisting primarily of deposits. As a result, a principal part of our business strategy is to manage interest rate risk and reduce the exposure of our net interest income to changes in market interest rates. The board of directors of First Guaranty Bank has established two committees, the management asset liability committee and the board investment committee, to oversee the interest rate risk inherent in our assets and liabilities, for determining the level of risk that is appropriate given our business strategy, operating environment, capital, liquidity and performance objectives, and for managing this risk consistent with the guidelines approved by the board of directors. The management asset liability committee is comprised of senior officers of the Bank and meets as needed to review our asset liability policies and interest rate risk position. The board ALCO investment committee is comprised of certain members of the board of directors of the Bank and meets monthly. The management asset liability committee provides a monthly report to the board ALCO investment committee.
 
The need for interest sensitivity gap management is most critical in times of rapid changes in overall interest rates. First Guaranty has generally been liability sensitive. We modified our business plan in 2024 to reduce the liability sensitive nature of our balance sheet. We are working to limit our future exposure to interest rate fluctuations by creating a more balanced mix of rate sensitive assets and liabilities on a one-year time horizon and greater than one-year time horizon. We purchased amortizing mortgage backed securities in 2024 and 2025. We also purchased U.S. Treasury securities with a maturity of one year or less in 2024. Because of the significant impact on net interest margin from mismatches in repricing opportunities, we monitor the asset-liability mix periodically depending upon the management asset liability committee's assessment of current business conditions and the interest rate outlook. These strategies include, but are not limited to, frequent internal modeling of asset and liability values and behavior due to changes in interest rates. We monitor cash flow forecasts closely and evaluate the impact of both prepayments and extension risk.

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The following interest sensitivity analysis is one measurement of interest rate risk. This analysis reflects the contractual maturity characteristics of assets and liabilities over various time periods. This analysis does not factor in prepayments or interest rate floors on loans which may significantly change the report. This table includes nonaccrual loans in their respective maturity periods. The gap indicates whether more assets or liabilities are subject to repricing over a given time period. The interest sensitivity analysis at September 30, 2025 illustrated below reflects a liability-sensitive position with a negative cumulative gap on a one-year basis.
 
The interest spread and liability funding discussed below are directly related to changes in asset and liability mixes, volumes, maturities and repricing opportunities for interest-earning assets and interest-bearing liabilities. Interest-sensitive assets and liabilities are those which are subject to repricing in the near term, including both floating or adjustable rate instruments and instruments approaching maturity. The interest sensitivity gap is the difference between total interest-sensitive assets and total interest-sensitive liabilities. Interest rates on our various asset and liability categories do not respond uniformly to changing market conditions. Interest rate risk is the degree to which interest rate fluctuations in the marketplace can affect net interest income.
 
September 30, 2025
Interest Sensitivity Within
(in thousands except for %) 3 Months Or Less Over 3 Months
thru 12 Months		 Total One Year Over One Year Total
Earning Assets:          
Loans (including loans held for sale) $ 848,867  $ 408,890  $ 1,257,757  $ 1,021,984  $ 2,279,741 
Securities (including FHLB stock) 10,099  3,552  13,651  693,176  706,827 
Federal Funds Sold 554  —  554  —  554 
Other earning assets 742,141  —  742,141  —  742,141 
Total earning assets $ 1,601,661  $ 412,442  $ 2,014,103  $ 1,715,160  $ 3,729,263 
Source of Funds:          
Interest-bearing accounts:          
Demand deposits $ 1,390,219  $ —  $ 1,390,219  $ —  $ 1,390,219 
Savings deposits 215,077  —  215,077  —  215,077 
Time deposits 261,324  647,356  908,680  444,015  1,352,695 
Short-term borrowings —  —  —  7,044  7,044 
Long-term borrowings 14,196  —  14,196  135,000  149,196 
Junior subordinated debt 29,790  —  29,790  —  29,790 
Noninterest-bearing, net —  —  —  585,242  585,242 
Total source of funds $ 1,910,606  $ 647,356  $ 2,557,962  $ 1,171,301  $ 3,729,263 
Period gap $ (308,945) $ (234,914) $ (543,859) $ 543,859   
Cumulative gap $ (308,945) $ (543,859) $ (543,859) $ —   
Cumulative gap as a percent of earning assets (8.3) % (14.6) % (14.6) %    

-60-

Item 4. Controls and Procedures
 
Evaluation of Disclosure Controls and Procedures
 
As defined by the Securities and Exchange Commission in Exchange Act Rules 13a-15(e) and 15d-15(e), a Company's "disclosure controls and procedures" means controls and other procedures of an issuer that are designed to ensure that information required to be disclosed by the issuer in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within time periods specified in the Commission's rules and forms. The Company maintains such controls to ensure this material information is communicated to Management, including the Chief Executive Officer ("CEO") and Chief Financial Officer ("CFO"), as appropriate, to allow timely decision regarding required disclosure. Based on our evaluation, our CEO and CFO have concluded that the Company’s disclosure controls and procedures were not effective as of September 30, 2025. This conclusion was reached because of the material weakness in our internal control over financial reporting initially identified in Part I, Item 4 of our Quarterly Report on Form 10-Q for the quarter ended June 30, 2025, filed with the SEC on August 18, 2025, and described below.

A material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the annual or interim consolidated financial statements will not be prevented or detected on a timely basis.

Notwithstanding the below identified material weakness, and notwithstanding the conclusion by our CEO and CFO that our disclosure controls and procedures as of September 30, 2025 were not effective, management believes the consolidated financial statements as included in this Quarterly Report on Form 10-Q present fairly, in all material respects, the Company's financial condition, results of operations and cash flows as of and for the periods presented in accordance with generally accepted accounting principles in the United States.

Material Weakness in Internal Control Over Financial Reporting

As of June 30, 2025, management determined that the Company did not effectively perform controls on a timely basis relating to the loan operations quality control review function for all new loans originated during the period. Management communicated the results of its assessment to the Audit Committee of the Board of Directors.

To address the identified material weakness described above, management implemented the following remediation steps:

•New leadership oversees the loan operations department;
•Additional staff have been added to the quality control function; and
•Enhanced monitoring processes have been instituted by the new loan department leadership.

Due to the nature of the remediation process, controls must operate effectively for a sufficient period of time for a definitive conclusion, validated through testing, that the deficiencies have been fully remediated and, as such, management cannot be certain that the measures it has undertaken have fully remediated the material weaknesses that it has identified or that additional material weaknesses will not arise in the future. Management will continue to monitor the design and effectiveness of these controls through ongoing tests during the fourth quarter of fiscal year 2025 and will make any further changes that management determines to be appropriate.

Changes in Internal Control Over Financial Reporting

Other than as described above, there were no changes in First Guaranty's internal control over financial reporting during the last fiscal quarter in the period covered by this quarterly report that have materially affected, or are reasonably likely to materially affect, First Guaranty's internal control over financial reporting.

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PART II. OTHER INFORMATION

Item 1. Legal Proceedings

First Guaranty is subject to various legal proceedings in the normal course of its business. First Guaranty assesses its liabilities and contingencies in connection with outstanding legal proceedings. Where it is probable that First Guaranty will incur a loss and the amount of the loss can be reasonably estimated, First Guaranty records a liability in its consolidated financial statements. First Guaranty does not record a loss if the loss is not probable, or the amount of the loss is not estimable. First Guaranty Bank is a defendant in a lawsuit alleging fault for a loss of funds by a customer related to fraud by a third party, with a possible loss range of $0.0 million to $1.5 million. The Bank denies the allegations and intends to vigorously defend against this lawsuit, which is in early stages, and no trial has been set. No accrued liability has been recorded related to this lawsuit. In the opinion of management, neither First Guaranty nor First Guaranty Bank is currently involved in such legal proceedings, either individually or in the aggregate, that the resolution is expected to have a material adverse effect on First Guaranty’s consolidated results of operations, financial condition, or cash flows. However, one or more unfavorable outcomes in these ordinary claims or litigation against First Guaranty or First Guaranty Bank could have a material adverse effect for the period in which they are resolved. In addition, regardless of their merits or ultimate outcomes, such matters are costly, divert management’s attention, and may materially and adversely affect the reputation of First Guaranty and First Guaranty Bank, even if resolved favorably.

Item 1A. Risk Factors

Except as disclosed in the updated risk factors below and elsewhere in this report, there are no material changes during the period covered by this Report to the risk factors previously disclosed in our 2024 Form 10-K. In particular, please see the discussion under the in Part I Item 2. “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in this report.

A portion of our loan portfolio is comprised of commercial and industrial loans secured by accounts receivables, inventory, equipment or other commercial collateral, the deterioration in value of which could increase the potential for future losses.

At September 30, 2025, $227.1 million, or 9.9% of our total loans, was comprised of commercial and industrial loans to businesses collateralized by general business assets including, among other things, accounts receivable, inventory and equipment and generally backed by a personal guaranty of the borrower or principal. These commercial and industrial loans are typically larger in amount than loans to individuals and, therefore, have the potential for larger losses on a single loan basis. Additionally, the repayment of commercial and industrial loans is subject to the ongoing business operations of the borrower. The collateral securing such loans generally includes movable property such as equipment and inventory, which may decline in value more rapidly than we anticipate, or may be difficult to market and sell, exposing us to increased credit risk. Significant adverse changes in the economy or local market conditions in which our commercial lending customers operate could cause rapid declines in loan collectability and the values associated with general business assets, resulting in inadequate collateral coverage that may expose us to credit losses and could adversely affect our business, financial condition and results of operations.

As discussed further in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in this report, we established a specific reserves of $39.8 million during the third quarter of 2025 for commercial lease exposure to entities related to an auto parts manufacturer that declared Chapter 11 bankruptcy. However, this specific allowance may not be sufficient with respect to our credit exposure to this borrower relationship, and the allowance for commercial and industrial loans generally may not be sufficient to fully address future losses in this portfolio.

We hold certain intangible assets that could be classified as impaired in the future. If these assets are considered to be either partially or fully impaired in the future, our earnings and the book values of these assets would decrease.

We are required to test goodwill and core deposit intangible assets for impairment on a periodic basis. The impairment testing process considers a variety of factors, including macroeconomic conditions, industry and market considerations, cost factors, and financial performance.

We performed an impairment test as of September 30, 2025, which resulted in the impairment of all $12.9 million of goodwill on our books as of that date. The impairment was the result of First Guaranty's stock price trading below book value and the recent increase in credit provisions. That impairment testing did not result in an impairment of our core deposit intangible assets. If an impairment determination is made in a future reporting period, either with respect to such core deposit intangible assets or other intangible assets we may acquire in the future, our earnings and the book value of these intangible assets will be reduced by the amount of the impairment which would adversely affect our financial performance.

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

(a)On September 30, 2025, First Guaranty issued an aggregate of 232,775 shares of its common stock, $1.00 par value per share (the “Common Stock”), for aggregate offering proceeds of $1.0 million. 122,503 shares were issued in a private placement, with the proceeds used for general corporate purposes, including to support continued growth and to enhance regulatory capital ratios. An additional 110,272 shares were issued as payment-in-kind in lieu of interest payments pursuant to that certain Promissory Note, dated as of June 4, 2025, by and between First Guaranty Bancshares, Inc. and Smith & Tate Investment, L.L.C. (the “Promissory Note Amendment”), and that certain First Amendment to the First Guaranty Bancshares, Inc. Floating Rate Subordinated Note due March 28, 2034, dated as of June 4, 2025, by and between First Guaranty and Smith & Tate Investment, L.L.C. (the “Subordinated Note Amendment”). The Company did not receive any proceeds of the payment-in-kind issuance. These issuances of common stock by First Guaranty were made to “accredited investors” in reliance upon the exemptions from registration available under Section 4(a)(2) of the Securities Act and Rule 506(b) of Regulation D.

(b)Not applicable.

(c)Not applicable.
-62-


Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

(a)Not applicable.

(b)Not applicable.

(c)During the nine months ended September 30, 2025, no First Guaranty officer or director adopted or terminated a "Rule 10b5-1 trading arrangement" or "non-Rule 10b5-1 trading agreement", as each term is defined in Item 408(a) of Regulation S-K.


-63-

Item 6.     Exhibits

 The following exhibits are either filed as part of this report or are incorporated herein by reference.
 
Exhibit Number Exhibit
3.1
3.2
3.3
3.4
3.5
4.1
4.2
4.2
4.3
4.4
4.5
4.6
4.7
31.1
31.2
32.1
32.2
101.SCH XBRL Taxonomy Extension Schema.
101.CAL XBRL Taxonomy Extension Calculation Linkbase.
101.DEF XBRL Taxonomy Extension Definition Linkbase.
101.PRE XBRL Taxonomy Extension Presentation Linkbase.
101.LAB XBRL Taxonomy Extension Label Linkbase.
101.INS XBRL Instance Document.

(1)Incorporated by reference to Exhibit 3.1 of the Current Report on Form 8-K12G3 filed by First Guaranty Bancshares, Inc. with the Securities and Exchange Commission on August 2, 2007.
(2)Incorporated by reference to Exhibit 3.1 of the Current Report on Form 8-K filed by First Guaranty Bancshares, Inc. with the Securities and Exchange Commission on September 23, 2011.
(3)Incorporated by reference to Exhibit 3.1 of the Current Report on Form 8-K filed by First Guaranty Bancshares, Inc. with the Securities and Exchange Commission on April 27, 2021.
(4)Incorporated by reference to Exhibit 3.2 of the Current Report on Form 8-K12G3 filed by First Guaranty Bancshares, Inc. with the Securities and Exchange Commission on August 2, 2007.
(5)Incorporated by reference to Exhibit 3.3 of the Current Report on Form 8-K12G3 filed by First Guaranty Bancshares, Inc. with the Securities and Exchange Commission on August 2, 2007.
(6)Incorporated by reference to Exhibit 4 of the Current Report on Form 8-K12G3 filed by First Guaranty Bancshares, Inc. with the Securities and Exchange Commission on August 2, 2007.
(7)Incorporated by reference to Exhibit 4.1 of the Current Report on Form 8-K filed by First Guaranty Bancshares, Inc. with the Securities and Exchange Commission on June 23, 2022.
(8)Incorporated by reference to Exhibit 4.3 of the Annual Report on Form 10-K filed by First Guaranty Bancshares, Inc. with the Securities and Exchange Commission on March 16, 2023.
(9)Incorporated by reference to Exhibit 4.1 of the Current Report on Form 8-K filed by First Guaranty Bancshares, Inc. with the Securities and Exchange Commission on April 27, 2021.
(10)Incorporated by reference to Exhibit 4.5 of the Annual Report on Form 10-K filed by First Guaranty Bancshares, Inc. with the Securities and Exchange Commission on March 16, 2023.
(11)Incorporated by reference to Exhibit 4.2 of the Current Report on Form 8-K filed by First Guaranty Bancshares, Inc. with the Securities and Exchange Commission on April 27, 2021.
(12)Incorporated by reference to Exhibit 4.2 of the Current Report on Form 8-K filed by First Guaranty Bancshares, Inc. with the Securities and Exchange Commission on April 3, 2024.



-64-

SIGNATURES
 
Pursuant to the requirements of the Securities Exchange Act of 1934, First Guaranty has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
 
FIRST GUARANTY BANCSHARES, INC.
 
Date: November 17, 2025   By: /s/ Michael R. Mineer
    Michael R. Mineer
President and Chief Executive Officer
    Principal Executive Officer
     
Date: November 17, 2025   By: /s/ Eric J. Dosch
    Eric J. Dosch
Chief Financial Officer, Secretary and Treasurer
    Principal Financial Officer

-65-
EX-31.1 2 fgbi-ex31109302025.htm EX-31.1 Document
EX-31.1 2 exhibit31-1.htm CERTIFICATION OF CHIEF EXECUTIVE OFFICER
EXHIBIT 31.1

Certification of Chief Executive Officer

Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Michael R. Mineer, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of First Guaranty Bancshares, Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this annual report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a)designed such disclosure controls and procedures or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting;

5.The registrant's other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a)all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b)any fraud, whether or not material, that involves Management or other employees who have a significant role in the registrant's internal control over financial reporting.

November 17, 2025

/s/ Michael R. Mineer
Michael R. Mineer
Chief Executive Officer
(Principal Executive Officer)
EX-31.2 3 fgbi-ex31209302025.htm EX-31.2 Document
EX-31.2 3 exhibit31-2.htm CERTIFICATION OF CHIEF FINANCIAL OFFICER

EXHIBIT 31.2

Certification of Chief Financial Officer

Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Eric J. Dosch, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of First Guaranty Bancshares, Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this annual report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a)designed such disclosure controls and procedures or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting;

5.The registrant's other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a)all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b)any fraud, whether or not material, that involves Management or other employees who have a significant role in the registrant's internal control over financial reporting.

November 17, 2025

/s/ Eric J. Dosch
Eric J. Dosch
Chief Financial Officer,
Secretary and Treasurer
(Principal Financial & Accounting Officer)
EX-32.1 4 fgbi-ex32109302025.htm EX-32.1 Document
EX-32.1 4 exhibit 32-1.htm CERTIFICATION OF CHIEF EXECUTIVE OFFICER
EXHIBIT 32.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002


In connection with the Quarterly Report of First Guaranty Bancshares, Inc. (the "Company") on Form 10-Q as of and for the fiscal period ended September 30, 2025 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Michael R. Mineer, Chief Executive Officer of the Company, certify that to the best of my knowledge:

(1)The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

November 17, 2025
/s/ Michael R. Mineer
Michael R. Mineer
Chief Executive Officer
(Principal Executive Officer)
EX-32.2 5 fgbi-ex32209302025.htm EX-32.2 Document
EX-32.2 5 exhibit32-2.htm CERTIFICATION OF CHIEF FINANCIAL OFFICER
EXHIBIT 32.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002


In connection with the Quarterly Report of First Guaranty Bancshares, Inc. (the "Company") on Form 10-Q as of and for the fiscal period ended September 30, 2025 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Eric J. Dosch, Chief Financial Officer of the Company, certify that to the best of my knowledge:

(1)The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

November 17, 2025

/s/ Eric J. Dosch
Eric J. Dosch
Chief Financial Officer
Secretary and Treasurer
(Principal Financial & Accounting Officer)