FBIZ First Business Financial Services Inc

 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): October 24, 2024

 

 

First Business Financial Services, Inc.

(Exact name of Registrant as Specified in Its Charter)

 

 

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

 

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

 

N/A

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

 

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

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

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

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

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

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Item 2.02 Results of Operations and Financial Condition.

On October 24, 2024, First Business Financial Services, Inc. (the “Company”) announced its earnings for the quarter ended September 30, 2024. A copy of the Company’s press release containing this information is being “furnished” as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference.

Item 7.01 Regulation FD Disclosure.

 

On October 24, 2024, the Company posted an investor presentation to its website www.firstbusiness.bank under the “Investor Relations” tab. The information included in the presentation provides an overview of the Company’s recent operating performance, financial condition, and business strategy. The Company intends to use this presentation in connection with its third quarter 2024 earnings call to be held at 1:00 p.m. Central time on October 25, 2024, and from time to time when the Company's executives interact with shareholders, analysts, and other third parties. A copy of the registrant’s presentation is attached hereto as Exhibit 99.2 to this Current Report on Form 8-K and is incorporated herein by reference.

 

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

 

 

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

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

99.1		Press release of the registrant dated October 24, 2024, containing financial information for its quarter ended September 30, 2024.
99.2		Slides from Third Quarter 2024 Investor Presentation

 

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

 

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

October 24, 2024				FIRST BUSINESS FINANCIAL SERVICES, INC.
				By:		/s/ Brian D. Spielmann
				Name:		Brian D. Spielmann
				Title:		Chief Financial Officer

 

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[FOR IMMEDIATE RELEASE]

First Business Financial Services, Inc.

401 Charmany Drive

Madison, WI 53719

FIRST BUSINESS BANK REPORTS THIRD QUARTER 2024 NET INCOME OF $10.3 MILLION

-- Stable net interest margin, continued balance sheet growth, and positive operating leverage support tangible book value expansion --

MADISON, Wis., October 24, 2024 (BUSINESS WIRE) -- First Business Financial Services, Inc. (the “Company”, the “Bank”, or “First Business Bank”) (Nasdaq:FBIZ) reported quarterly net income available to common shareholders of $10.3 million, or earnings per share of $1.24 on a diluted basis. This compares to net income available to common shareholders of $10.2 million, or $1.23 per share, in the second quarter of 2024 and $9.7 million, or $1.17 per share, in the third quarter of 2023.

“First Business Bank again produced strong deposit and loan growth in a highly competitive environment,” said Corey Chambas, Chief Executive Officer. “Our ability to consistently deliver quality growth was supported by our team’s outstanding balance sheet management, resulting in a strong and stable net interest margin that remained within our target range of 3.60%-3.65%. We continue to execute our organic growth strategy with the intention of delivering double-digit loan, deposit, and revenue growth over the long term. We also continue to deliver on our commitment to achieving positive operating leverage, aided by prudent expense management, strong net interest income momentum, and revenue diversification. These successes have contributed to exceptional growth in shareholder value, with tangible book value expanding 12.5% from the prior year.”

Quarterly Highlights

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Quarterly Financial Results

 

(Unaudited)		As of and for the Three Months Ended						As of and for the Nine Months Ended
(Dollars in thousands, except per share amounts)		September 30, 2024		June 30, 2024		September 30, 2023		September 30, 2024		September 30, 2023
Net interest income		$31,007		$30,540		$28,596		$91,059		$83,049
Adjusted non-interest income (1)		7,064		7,425		8,430		21,254		24,259
Operating revenue (1)		38,071		37,965		37,026		112,313		107,308
Operating expense (1)		22,653		23,823		22,943		69,674		66,414
Pre-tax, pre-provision adjusted earnings (1)		15,418		14,142		14,083		42,639		40,894
Less:
Provision for credit losses		2,087		1,713		1,817		6,126		5,610
Net (gain) loss on repossessed assets		(12)		65		4		72		8
SBA recourse provision		466		(9)		242		583		565
Add:
Net loss on sale of securities		—		—		—		(8)		(45)
Income before income tax expense		12,877		12,373		12,020		35,850		34,666
Income tax expense		2,351		1,917		2,079		6,020		7,409
Net income		$10,526		$10,456		$9,941		$29,830		$27,257
Preferred stock dividends		218		219		218		656		656
Net income available to common shareholders		$10,308		$10,237		$9,723		$29,174		$26,601
Earnings per share, diluted		$1.24		$1.23		$1.17		$3.50		$3.19
Book value per share		$36.17		$35.35		$32.32		$36.17		$32.32
Tangible book value per share (1)		$34.74		$33.92		$30.87		$34.74		$30.87
Net interest margin (2)		3.64%		3.65%		3.76%		3.62%		3.81%
Adjusted net interest margin (1)(2)		3.51%		3.47%		3.66%		3.47%		3.68%
Fee income ratio (non-interest income / total revenue)		18.55%		19.56%		22.77%		18.92%		22.57%
Efficiency ratio (1)		59.50%		62.75%		61.96%		62.04%		61.89%
Return on average assets (2)		1.13%		1.14%		1.19%		1.08%		1.13%
Pre-tax, pre-provision adjusted return on average assets (1)(2)		1.70%		1.57%		1.72%		1.59%		1.74%
Return on average common equity (2)		13.83%		14.12%		14.62%		13.41%		13.72%
Period-end loans and leases receivable		$3,050,079		$2,985,414		$2,764,014		$3,050,079		$2,764,014
Average loans and leases receivable		$3,031,880		$2,962,927		$2,711,851		$2,961,014		$2,592,941
Period-end core deposits		$2,382,730		$2,309,635		$2,189,264		$2,382,730		$2,189,264
Average core deposits		$2,375,002		$2,375,101		$2,105,716		$2,365,553		$2,047,776
Allowance for credit losses, including unfunded commitment reserves		$35,509		$34,950		$31,036		$35,509		$31,036
Non-performing assets		$19,420		$19,053		$17,689		$19,420		$17,689
Allowance for credit losses as a percent of total gross loans and leases		1.16%		1.17%		1.12%		1.16%		1.12%
Non-performing assets as a percent of total assets		0.52%		0.53%		0.52%		0.52%		0.52%

 

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Third Quarter 2024 Compared to Second Quarter 2024

Net interest income increased $467,000, or 1.5%, to $31.0 million.

The Bank reported a provision expense of $2.1 million, compared to $1.7 million in the second quarter of 2024. The quarterly increase was driven by higher specific reserve requirements for Equipment Finance and Small Business Administration ("SBA") borrowers in the Commercial and Industrial ("C&I") loan portfolio. The $2.1 million expense consisted of $1.5 million of net charge-offs, $616,000 due to loan growth, and a $757,000 net increase in specific reserves, partially offset by decreases of $444,000 and $330,000 due to quantitative and qualitative factor changes, respectively. The decrease related to quantitative factors was primarily due to modest improvement in the economic forecast and the decrease related to qualitative factors was due to moderated growth in several portfolios.

Non-interest income decreased $361,000, or 4.9%, to $7.1 million.

 

 

 

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Non-interest expense decreased $772,000, or 3.2%, to $23.1 million, while operating expense decreased $1.2 million, or 4.9%, to $22.7 million.

Income tax expense increased $434,000, or 22.6%, to $2.4 million. The effective tax rate was 18.3% for the three months ended September 30, 2024, compared to 15.5% for the linked quarter. The increase is primarily driven by adjustments to tax credit investments upon receipt of annual partnership filings. The Company expects to report an effective tax rate between 16% and 18% for 2024.

Total period-end loans and leases receivable increased $65.0 million, or 8.7% annualized, to $3.050 billion. The average rate earned on average loans and leases receivable was 7.32%, up 4 basis points from 7.28% in the prior quarter. Excluding fees in lieu of interest, the average rate earned on average loans and leases receivable was 7.20%, up 9 basis points from 7.11% in the prior quarter.

Total period-end core deposits increased $73.1 million, or 12.7% annualized, to $2.383 billion, compared to $2.310 billion. The average rate paid remained flat at 3.34%.

Period-end wholesale funding, including FHLB advances and brokered deposits, increased $27.8 million, or 13.0% annualized, to $881.7 million. Consistent with the Bank’s long-held philosophy to manage interest rate risk, management will continue to utilize the most efficient and cost-effective source of wholesale funds to match-fund fixed-rate loans as necessary.

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Non-performing assets increased $367,000 to $19.4 million, or 0.52% of total assets, down as a percentage of total assets from 0.53% in the prior quarter. While we continue to expect full repayment of the one Asset-Based Lending ("ABL") loan that defaulted during the second quarter of 2023, the liquidation process has transitioned into Chapter 7 bankruptcy, likely delaying final resolution until late 2024 or 2025. Through our collection efforts, the current balance of this loan is $6.4 million, down from $10.0 million in the prior year quarter. Excluding this ABL loan, non-performing assets totaled $13.0 million, or 0.35% of total assets in the current quarter and $12.6 million, or 0.35% of total assets in the linked quarter.

The allowance for credit losses, including the unfunded credit commitments reserve, increased $559,000, or 1.6%, as increases in the general reserve from loan growth, charge-offs, and new specific reserves were partially offset by changes in quantitative and qualitative factors. The allowance for credit losses, including unfunded credit commitment reserves, as a percent of total gross loans and leases was 1.16% compared to 1.17% in the prior quarter.

Third Quarter 2024 Compared to Third Quarter 2023

Net interest income increased $2.4 million, or 8.4%, to $31.0 million.

The Company reported a credit loss provision expense of $2.1 million, compared to $1.8 million in the third quarter of 2023. See provision breakdown table below for more detail on the components of provision expense.

Non-interest income decreased $1.4 million, or 16.2%, to $7.1 million.

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Non-interest expense decreased $82,000, or 0.4%, to $23.1 million. Operating expense decreased $290,000, or 1.3%, to $22.7 million.

Total period-end loans and leases receivable increased $286.3 million, or 10.3%, to $3.050 billion.

Total period-end core deposits grew $193.5 million, or 8.8%, to $2.383 billion, and the average rate paid increased 36 basis points to 3.34%. The increase in average rate paid on core deposits was primarily due to heightened competition and a change in deposit mix. Total average core deposits grew $269.3 million, or 12.8%, to $2.375 billion.

Period-end wholesale funding increased $99.4 million, or 12.7%, to $881.7 million.

Non-performing assets increased to $19.4 million, or 0.52% of total assets, compared to $17.7 million, or 0.52% of total assets, driven by past-due Equipment Finance loans within the C&I portfolio. Excluding one ABL loan for which we expect full repayment, non-performing assets totaled $13.0 million, or 0.35% of total assets.

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The allowance for credit losses, including unfunded commitment reserves, increased $4.5 million to $35.5 million, compared to $31.0 million primarily due to an increase in specific reserves and loan growth, partially offset by chargeoffs. The allowance for credit losses as a percent of total gross loans and leases was 1.16%, compared 1.12% in the prior year.

Subordinated Debt Offering

On September 19, 2024 the Company announced the completion of a private placement of $20.0 million in aggregate principal amount of 7.5% Subordinated Debentures due September 13, 2034 (the “Notes”) on September 13, 2024. The Company used the net proceeds to repay the indebtedness incurred to fund the August 15, 2024 redemption in full of its $15 million in aggregate principal amount of 2019 Fixed-to-Floating Rate Subordinated Notes due August 15, 2029, and the Company intends to use the remaining proceeds to fund the Company’s anticipated future loan growth.

Investor Presentation and Conference Call

On October 24, 2024, the Company posted an investor presentation to its website www.firstbusiness.bank under the “Investor Relations” tab and will also be furnished to the U.S. Securities and Exchange Commission on October 24, 2024. The information included in the presentation provides an overview of the Company’s recent operating performance, financial condition, and business strategy. The Company intends to use this presentation in connection with its third quarter 2024 earnings call to be held at 1:00 p.m. Central time on October 25, 2024, and from time to time when the Company's executives interact with shareholders, analysts, and other third parties. The conference call can be accessed at 800-343-4849 (203-518-9848 if outside the United States and Canada), using the conference call access code: FBIZ. Investors may also listen live via webcast at: https://events.q4inc.com/attendee/456665235. A replay of the call will be available through Friday, November 1, 2024, by calling 800-839-2418 or 402-220-7210 for international participants. The webcast archive of the conference call will be available on the Company’s website, ir.firstbusiness.bank.

About First Business Bank

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

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

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

 

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

 

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SELECTED FINANCIAL CONDITION DATA

 

(Unaudited)		As of
(in thousands)		September 30, 2024		June 30, 2024		March 31, 2024		December 31, 2023		September 30, 2023
Assets
Cash and cash equivalents		$131,972		$81,080		$72,040		$139,510		$132,915
Securities available-for-sale, at fair value		313,336		308,852		314,114		297,006		272,163
Securities held-to-maturity, at amortized cost		6,907		7,082		8,131		8,503		8,689
Loans held for sale		8,173		6,507		4,855		4,589		4,168
Loans and leases receivable		3,050,079		2,985,414		2,910,864		2,850,261		2,764,014
Allowance for credit losses		(33,688)		(33,088)		(32,799)		(31,275)		(29,331)
Loans and leases receivable, net		3,016,391		2,952,326		2,878,065		2,818,986		2,734,683
Premises and equipment, net		5,478		6,381		6,268		6,190		6,157
Repossessed assets		56		54		317		247		61
Right-of-use assets		5,789		6,041		6,297		6,559		6,800
Bank-owned life insurance		56,767		56,351		55,948		55,536		55,123
Federal Home Loan Bank stock, at cost		12,775		11,901		13,326		12,042		13,528
Goodwill and other intangible assets		11,834		11,841		11,950		12,023		12,110
Derivatives		42,539		70,773		69,703		55,597		93,702
Accrued interest receivable and other assets		103,707		97,872		90,344		91,058		78,751
Total assets		$3,715,724		$3,617,061		$3,531,358		$3,507,846		$3,418,850
Liabilities and Stockholders’ Equity
Core deposits		$2,382,730		$2,309,635		$2,297,843		$2,339,071		$2,189,264
Wholesale deposits		587,217		575,548		457,563		457,708		467,743
Total deposits		2,969,947		2,885,183		2,755,406		2,796,779		2,657,007
Federal Home Loan Bank advances and    other borrowings		349,109		327,855		381,718		330,916		363,891
Lease liabilities		8,054		8,361		8,664		8,954		9,236
Derivatives		45,399		61,821		61,133		51,949		78,696
Accrued interest payable and other liabilities		31,233		28,671		26,649		29,660		29,262
Total liabilities		3,403,742		3,311,891		3,233,570		3,218,258		3,138,092
Total stockholders’ equity		311,982		305,170		297,788		289,588		280,758
Total liabilities and stockholders’ equity		$3,715,724		$3,617,061		$3,531,358		$3,507,846		$3,418,850

 

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STATEMENTS OF INCOME

 

(Unaudited)		As of and for the Three Months Ended										As of and for the Nine Months Ended
(Dollars in thousands, except per share amounts)		September 30, 2024		June 30, 2024		March 31, 2024		December 31, 2023		September 30, 2023		September 30, 2024		September 30, 2023
Total interest income		$59,327		$57,910		$55,783		$54,762		$50,941		$173,020		$140,167
Total interest expense		28,320		27,370		26,272		25,222		22,345		81,961		57,118
Net interest income		31,007		30,540		29,511		29,540		28,596		91,059		83,049
Provision for credit losses		2,087		1,713		2,326		2,573		1,817		6,126		5,610
Net interest income after provision for credit losses		28,920		28,827		27,185		26,967		26,779		84,933		77,439
Private wealth management service fees		3,264		3,461		3,111		2,933		2,945		9,835		8,492
Gain on sale of SBA loans		460		349		195		284		851		1,004		1,771
Service charges on deposits		920		951		940		848		835		2,810		2,283
Loan fees		812		826		847		869		786		2,486		2,495
Loss on sale of securities		—		—		(8)		—		—		(8)		(45)
Swap fees		460		157		198		438		992		815		2,526
Other non-interest income		1,148		1,681		1,474		1,722		2,021		4,304		6,692
Total non-interest income		7,064		7,425		6,757		7,094		8,430		21,246		24,214
Compensation		15,198		16,215		16,157		14,450		15,573		47,570		46,610
Occupancy		585		593		607		571		575		1,785		1,809
Professional fees		1,305		1,472		1,571		1,313		1,429		4,348		4,012
Data processing		1,045		1,182		1,018		936		953		3,245		2,889
Marketing		922		850		818		724		758		2,591		2,165
Equipment		333		335		345		340		349		1,013		1,000
Computer software		1,608		1,555		1,418		1,317		1,289		4,581		3,668
FDIC insurance		810		612		610		585		680		2,032		1,653
Other non-interest expense		1,301		1,065		798		1,352		1,583		3,164		3,181
Total non-interest expense		23,107		23,879		23,342		21,588		23,189		70,329		66,987
Income before income tax expense		12,877		12,373		10,600		12,473		12,020		35,850		34,666
Income tax expense		2,351		1,917		1,752		2,703		2,079		6,020		7,409
Net income		$10,526		$10,456		$8,848		$9,770		$9,941		$29,830		$27,257
Preferred stock dividends		218		219		219		219		218		656		656
Net income available to common shareholders		$10,308		$10,237		$8,629		$9,551		$9,723		$29,174		$26,601
Per common share:
Basic earnings		$1.24		$1.23		$1.04		$1.15		$1.17		$3.50		$3.19
Diluted earnings		1.24		1.23		1.04		1.15		1.17		3.50		3.19
Dividends declared		0.2500		0.2500		0.2500		0.2275		0.2275		0.7500		0.6825
Book value		36.17		35.35		34.41		33.39		32.32		36.17		32.32
Tangible book value		34.74		33.92		32.97		31.94		30.87		34.74		30.87
Weighted-average common shares    outstanding(1)		8,111,215		8,113,246		8,125,319		8,110,462		8,107,641		8,149,949		8,134,587
Weighted-average diluted common shares    outstanding(1)		8,111,215		8,113,246		8,125,319		8,110,462		8,107,641		8,149,949		8,134,587

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NET INTEREST INCOME ANALYSIS

 

(Unaudited)		For the Three Months Ended
(Dollars in thousands)		September 30, 2024						June 30, 2024						September 30, 2023
		Average Balance		Interest		Average Yield/Rate(4)		Average Balance		Interest		Average Yield/Rate(4)		Average Balance		Interest		Average Yield/Rate(4)
Interest-earning assets
Commercial real estate and    other mortgage loans(1)		$1,805,020		$30,340		6.72%		$1,765,743		$29,299		6.64%		$1,605,464		$25,623		6.38%
Commercial and industrial    loans(1)		1,177,112		24,481		8.32		1,146,312		23,869		8.33		1,059,512		21,635		8.17
Consumer and other loans(1)		49,748		685		5.51		50,872		725		5.70		46,875		610		5.21
Total loans and leases    receivable(1)		3,031,880		55,506		7.32		2,962,927		53,893		7.28		2,711,851		47,868		7.06
Mortgage-related securities(2)		269,842		2,662		3.95		261,828		2,609		3.99		204,291		1,681		3.29
Other investment securities(3)		51,446		315		2.45		60,780		443		2.92		67,546		517		3.06
FHLB stock		11,960		285		9.53		12,656		291		9.20		14,770		323		8.75
Short-term investments		40,406		559		5.53		48,836		674		5.52		40,318		552		5.48
Total interest-earning assets		3,405,534		59,327		6.97		3,347,027		57,910		6.92		3,038,776		50,941		6.71
Non-interest-earning assets		231,353						245,188						237,464
Total assets		$3,636,887						$3,592,215						$3,276,240
Interest-bearing liabilities
Transaction accounts		$864,936		8,451		3.91		$880,752		8,737		3.97		$731,529		6,774		3.70
Money market		850,590		8,780		4.13		815,846		8,264		4.05		657,183		5,871		3.57
Certificates of deposit		219,315		2,584		4.71		241,535		2,803		4.64		282,674		2,986		4.23
Wholesale deposits		531,472		5,475		4.12		476,149		4,871		4.09		410,494		4,172		4.07
Total interest-bearing    deposits		2,466,313		25,290		4.10		2,414,282		24,675		4.09		2,081,880		19,803		3.80
FHLB advances		278,103		2,059		2.96		294,043		1,974		2.69		342,117		2,117		2.48
Other borrowings		50,642		971		7.67		49,481		721		5.83		34,745		425		4.89
Total interest-bearing    liabilities		2,795,058		28,320		4.05		2,757,806		27,370		3.97		2,458,742		22,345		3.64
Non-interest-bearing demand    deposit accounts		440,161						436,968						434,330
Other non-interest-bearing    liabilities		91,520						95,484						105,079
Total liabilities		3,326,739						3,290,258						2,998,151
Stockholders’ equity		310,148						301,957						278,089
Total liabilities and    stockholders’ equity		$3,636,887						$3,592,215						$3,276,240
Net interest income				$31,007						$30,540						$28,596
Interest rate spread						2.92%						2.95%						3.07%
Net interest-earning assets		$610,476						$589,221						$580,034
Net interest margin						3.64%						3.65%						3.76%

 

 

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		For the Nine Months Ended September 30,
		2024						2023
		Average Balance		Interest		Average Yield/Rate(4)		Average Balance		Interest		Average Yield/Rate(4)
		(Dollars in Thousands)
Interest-earning assets
Commercial real estate and other    mortgage loans(1)		$1,764,133		$87,759		6.63%		$1,556,988		$71,011		6.08%
Commercial and industrial loans(1)		1,146,495		71,074		8.27		988,359		59,213		7.99
Consumer and other loans(1)		50,386		2,114		5.59		47,594		1,738		4.87
Total loans and leases receivable(1)		2,961,014		160,947		7.25		2,592,941		131,962		6.79
Mortgage-related securities(2)		257,914		7,547		3.90		193,196		4,372		3.02
Other investment securities(3)		60,037		1,276		2.83		61,396		1,229		2.67
FHLB and FRB stock		12,294		859		9.32		15,904		952		7.98
Short-term investments		58,040		2,391		5.49		43,437		1,652		5.07
Total interest-earning assets		3,349,299		173,020		6.89		2,906,874		140,167		6.43
Non-interest-earning assets		236,569						223,552
Total assets		$3,585,868						$3,130,426
Interest-bearing liabilities
Transaction accounts		$869,511		25,635		3.93		$657,155		16,070		3.26
Money market accounts		809,593		24,609		4.05		663,284		14,984		3.01
Certificates of deposit		246,267		8,597		4.65		271,684		8,049		3.95
Wholesale deposits		488,543		14,961		4.08		311,038		9,671		4.14
Total interest-bearing deposits		2,413,914		73,802		4.08		1,903,161		48,774		3.42
FHLB advances		286,454		5,750		2.68		368,913		7,030		2.54
Other borrowings		49,863		2,409		6.44		35,351		1,314		4.96
Total interest-bearing liabilities		2,750,231		81,961		3.97		2,307,425		57,118		3.30
Non-interest-bearing demand    deposit accounts		440,182						455,653
Other non-interest-bearing liabilities		93,430						96,883
Total liabilities		3,283,843						2,859,961
Stockholders’ equity		302,025						270,465
Total liabilities and stockholders’    equity		$3,585,868						$3,130,426
Net interest income				$91,059						$83,049
Interest rate spread						2.91%						3.13%
Net interest-earning assets		$599,068						$599,449
Net interest margin						3.62%						3.81%
Average interest-earning assets to    average interest-bearing liabilities		121.78%						125.98%
Return on average assets(4)		1.08%						1.13%
Return on average common equity(4)		13.41%						13.72%
Average equity to average assets		8.42%						8.64%
Non-interest expense to average    assets(4)		2.62%						2.85%

 

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PROVISION FOR CREDIT LOSS COMPOSITION

 

(Unaudited)		For the Three Months Ended										For the Nine Months Ended
(Dollars in thousands)		September 30, 2024		June 30, 2024		March 31, 2024		December 31, 2023		September 30, 2023		September 30, 2024		September 30, 2023
Change due to qualitative factor changes		$(444)		$496		$740		$(432)		$506		$793		$465
Change due to quantitative factor    changes		(330)		150		(199)		(260)		(1,372)		(380)		(1,193)
Charge-offs		1,619		1,583		921		724		562		4,123		1,057
Recoveries		(91)		(191)		(227)		(114)		(84)		(509)		(435)
Change in reserves on individually    evaluated loans, net		757		(1,037)		629		2,008		1,265		348		2,322
Change due to loan growth, net		616		680		354		629		817		1,652		3,023
Change in unfunded commitment    reserves		(40)		32		108		17		123		99		371
Total provision for credit losses		$2,087		$1,713		$2,326		$2,572		$1,817		$6,126		$5,610

 

PERFORMANCE RATIOS

 

		For the Three Months Ended										For the Nine Months Ended
(Unaudited)		September 30, 2024		June 30, 2024		March 31, 2024		December 31, 2023		September 30, 2023		September 30, 2024		September 30, 2023
Return on average assets (annualized)		1.13%		1.14%		0.98%		1.11%		1.19%		1.08%		1.13%
Return on average common equity (annualized)		13.83%		14.12%		12.24%		13.99%		14.62%		13.41%		13.72%
Efficiency ratio		59.50%		62.75%		63.76%		58.34%		61.96%		62.04%		61.89%
Interest rate spread		2.92%		2.95%		2.88%		2.97%		3.07%		2.91%		3.13%
Net interest margin		3.64%		3.65%		3.58%		3.69%		3.76%		3.62%		3.81%
Average interest-earning assets to average interest-bearing liabilities		121.84%		121.37%		122.15%		123.02%		123.59%		121.78%		125.98%

 

ASSET QUALITY RATIOS

 

(Unaudited)		As of
(Dollars in thousands)		September 30, 2024		June 30, 2024		March 31, 2024		December 31, 2023		September 30, 2023
Non-accrual loans and leases		$19,364		$18,999		$19,829		$20,597		$17,628
Repossessed assets		56		54		317		247		61
Total non-performing assets		$19,420		$19,053		$20,146		$20,844		$17,689
Non-accrual loans and leases as a    percent of total gross loans and leases		0.63%		0.64%		0.68%		0.72%		0.64%
Non-performing assets as a percent of    total gross loans and leases plus    repossessed assets		0.64%		0.64%		0.69%		0.73%		0.64%
Non-performing assets as a percent of    total assets		0.52%		0.53%		0.57%		0.59%		0.52%
Allowance for credit losses as a percent    of total gross loans and leases		1.16%		1.17%		1.19%		1.16%		1.12%
Allowance for credit losses as a percent    of non-accrual loans and leases		183.38%		183.96%		174.64%		160.21%		176.06%

 

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NET CHARGE-OFFS (RECOVERIES)

 

(Unaudited)		For the Three Months Ended										For the Nine Months Ended
(Dollars in thousands)		September 30, 2024		June 30, 2024		March 31, 2024		December 31, 2023		September 30, 2023		September 30, 2024		September 30, 2023
Charge-offs		$1,619		$1,583		$921		$724		$562		$4,123		$1,057
Recoveries		(91)		(191)		(227)		(114)		(84)		(509)		(435)
Net charge-offs (recoveries)		$1,528		$1,392		$694		$610		$478		$3,614		$622
Net charge-offs (recoveries) as a percent of average gross loans and leases (annualized)		0.20%		0.19%		0.10%		0.09%		0.07%		0.16%		0.03%

 

CAPITAL RATIOS

 

		As of and for the Three Months Ended
(Unaudited)		September 30, 2024		June 30, 2024		March 31, 2024		December 31, 2023		September 30, 2023
Total capital to risk-weighted assets		11.72%		11.45%		11.36%		11.19%		11.20%
Tier I capital to risk-weighted assets		9.11%		8.99%		8.86%		8.74%		8.74%
Common equity tier I capital to risk-    weighted assets		8.76%		8.64%		8.51%		8.38%		8.37%
Tier I capital to adjusted assets		8.68%		8.51%		8.45%		8.43%		8.65%
Tangible common equity to tangible    assets		7.78%		7.80%		7.78%		7.60%		7.53%

 

LOAN AND LEASE RECEIVABLE COMPOSITION

 

(Unaudited)		As of
(in thousands)		September 30, 2024		June 30, 2024		March 31, 2024		December 31, 2023		September 30, 2023
Commercial real estate:
Commercial real estate - owner occupied		$259,532		$258,636		$263,748		$256,479		$236,058
Commercial real estate - non-owner occupied		768,195		777,704		792,858		773,494		753,517
Construction		266,762		229,181		202,382		193,080		211,828
Multi-family		494,954		470,176		453,321		450,529		409,714
1-4 family		39,933		39,680		27,482		26,289		24,235
Total commercial real estate		1,829,376		1,775,377		1,739,791		1,699,871		1,635,352
Commercial and industrial		1,174,295		1,161,711		1,120,779		1,105,835		1,083,698
Consumer and other		46,610		48,145		50,020		44,312		44,808
Total gross loans and leases receivable		3,050,281		2,985,233		2,910,590		2,850,018		2,763,858
Less:
Allowance for credit losses		33,688		33,088		32,799		31,275		29,331
Deferred loan fees		202		(181)		(274)		(243)		(156)
Loans and leases receivable, net		$3,016,391		$2,952,326		$2,878,065		$2,818,986		$2,734,683

 

DEPOSIT COMPOSITION

 

(Unaudited)		As of
(in thousands)		September 30, 2024		June 30, 2024		March 31, 2024		December 31, 2023		September 30, 2023
Non-interest-bearing transaction accounts		$428,012		$406,804		$400,267		$445,376		$430,011
Interest-bearing transaction accounts		930,252		841,146		818,080		895,319		779,789
Money market accounts		817,129		837,569		813,467		711,245		694,199
Certificates of deposit		207,337		224,116		266,029		287,131		285,265
Wholesale deposits		587,217		575,548		457,563		457,708		467,743
Total deposits		$2,969,947		$2,885,183		$2,755,406		$2,796,779		$2,657,007
Uninsured deposits		$1,088,496		$1,011,977		$995,428		$994,687		$916,083
Less: uninsured deposits collateralized by pledged assets		10,755		34,810		16,622		17,051		28,873
Total uninsured, net of collateralized deposits		1,077,741		977,167		978,806		977,636		887,210
% of total deposits		36.3%		33.9%		35.5%		35.0%		33.4%

 

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SOURCES OF LIQUIDITY

 

(Unaudited)		As of
(in thousands)		September 30, 2024		June 30, 2024		March 31, 2024		December 31, 2023		September 30, 2023
Short-term investments		$86,670		$54,680		$46,984		$107,162		$109,612
Collateral value of unencumbered pledged loans		397,852		401,602		340,639		367,471		315,067
Market value of unencumbered securities		279,191		289,104		288,965		259,791		236,618
Readily accessible liquidity		763,713		745,386		676,588		734,424		661,297
Fed fund lines		45,000		45,000		45,000		45,000		45,000
Excess brokered CD capacity(1)		1,102,767		1,051,678		1,166,661		1,231,791		1,090,864
Total liquidity		$1,911,480		$1,842,064		$1,888,249		$2,011,215		$1,797,161
Total uninsured, net of collateralized deposits		1,077,741		977,167		978,806		977,636		887,210

 

PRIVATE WEALTH OFF-BALANCE SHEET COMPOSITION

 

(Unaudited)		As of
(in thousands)		September 30, 2024		June 30, 2024		March 31, 2024		December 31, 2023		September 30, 2023
Trust assets under management		$3,145,789		$3,008,897		$3,080,951		$2,898,516		$2,715,801
Trust assets under administration		252,152		239,766		239,249		223,013		198,864
Total trust assets		$3,397,941		$3,248,663		$3,320,200		$3,121,529		$2,914,665

 

NON-GAAP RECONCILIATIONS

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

TANGIBLE BOOK VALUE

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

 

(Unaudited)		As of
(Dollars in thousands, except per share amounts)		September 30, 2024		June 30, 2024		March 31, 2024		December 31, 2023		September 30, 2023
Common stockholders’ equity		$299,990		$293,178		$285,796		$277,596		$268,766
Less: Goodwill and other intangible assets		(11,834)		(11,841)		(11,950)		(12,023)		(12,110)
Tangible common equity		$288,156		$281,337		$273,846		$265,573		$256,656
Common shares outstanding		8,295,017		8,294,589		8,306,573		8,314,778		8,315,186
Book value per share		$36.17		$35.35		$34.41		$33.39		$32.32
Tangible book value per share		34.74		33.92		32.97		31.94		30.87

 

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TANGIBLE COMMON EQUITY TO TANGIBLE ASSETS

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

 

(Unaudited)		As of
(Dollars in thousands)		September 30, 2024		June 30, 2024		March 31, 2024		December 31, 2023		September 30, 2023
Common stockholders’ equity		$299,990		$293,178		$285,796		$277,596		$268,766
Less: Goodwill and other intangible assets		(11,834)		(11,841)		(11,950)		(12,023)		(12,110)
Tangible common equity (a)		$288,156		$281,337		$273,846		$265,573		$256,656
Total assets		$3,715,724		$3,617,061		$3,531,358		$3,507,846		$3,418,850
Less: Goodwill and other intangible assets		(11,834)		(11,841)		(11,950)		(12,023)		(12,110)
Tangible assets (b)		$3,703,890		$3,605,220		$3,519,408		$3,495,823		$3,406,740
Tangible common equity to tangible assets		7.78%		7.80%		7.78%		7.60%		7.53%
Fair Value Adjustments:
Financial assets - MTM (c)		$(17,615)		$(17,432)		$(29,019)		$(29,136)		$(45,489)
Financial liabilities - MTM (d)		$8,358		$9,032		$12,560		$11,945		$23,436
Net MTM, after-tax e = (c-d)*(1-21%)		$(7,313)		$(6,636)		$(13,003)		$(13,581)		$(17,422)
Adjusted tangible equity f = (a-e)		$280,843		$274,701		$260,843		$251,992		$239,234
Adjusted tangible assets g = (b-c)		$3,686,275		$3,587,788		$3,490,389		$3,466,687		$3,361,251
Adjusted TCE ratio (f/g)		7.62%		7.66%		7.47%		7.27%		7.12%

 

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

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

 

(Unaudited)		For the Three Months Ended										For the Nine Months Ended
(Dollars in thousands)		September 30, 2024		June 30, 2024		March 31, 2024		December 31, 2023		September 30, 2023		September 30, 2024		September 30, 2023
Total non-interest expense		$23,107		$23,879		$23,342		$21,588		$23,189		$70,329		$66,987
Less:
Net loss (gain) on repossessed assets		(12)		65		86		4		4		72		8
SBA recourse provision (benefit)		466		(9)		126		210		242		583		565
Total operating expense (a)		$22,653		$23,823		$23,130		$21,374		$22,943		$69,674		$66,414
Net interest income		$31,007		$30,540		$29,511		$29,540		$28,596		$91,059		$83,049
Total non-interest income		7,064		7,425		6,757		7,094		8,430		21,246		24,214
Less:
Net loss on sale of securities		—		—		(8)		—		—		(8)		(45)
Adjusted non-interest income		7,064		7,425		6,765		7,094		8,430		21,254		24,259
Total operating revenue (b)		$38,071		$37,965		$36,276		$36,634		$37,026		$112,313		$107,308
Efficiency ratio		59.50%		62.75%		63.76%		58.34%		61.96%		62.04%		61.89%
Pre-tax, pre-provision adjusted earnings (b - a)		$15,418		$14,142		$13,146		$15,260		$14,083		$42,639		$40,894
Average total assets		$3,636,887		$3,592,215		$3,527,941		$3,454,652		$3,276,240		$3,585,868		$3,130,426
Pre-tax, pre-provision adjusted return on    average assets		1.70%		1.57%		1.49%		1.77%		1.72%		1.59%		1.74%

 

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ADJUSTED NET INTEREST MARGIN

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

 

(Unaudited)		For the Three Months Ended										For the Nine Months Ended
(Dollars in thousands)		September 30, 2024		June 30, 2024		March 31, 2024		December 31, 2023		September 30, 2023		September 30, 2024		September 30, 2023
Interest income		$59,327		$57,910		$55,783		$54,762		$50,941		$173,020		$140,167
Interest expense		28,320		27,370		26,272		25,222		22,345		81,961		57,118
Net interest income (a)		31,007		30,540		29,511		29,540		28,596		91,059		83,049
Less:
Fees in lieu of interest		942		1,227		793		1,075		582		2,962		2,169
FRB interest income and FHLB dividend income		841		959		1,436		1,466		870		3,235		2,590
Adjusted net interest income (b)		$29,224		$28,354		$27,282		$26,999		$27,144		$84,862		$78,290
Average interest-earning assets (c)		$3,405,534		$3,347,027		$3,294,717		$3,199,485		$3,038,776		$3,349,299		$2,906,874
Less:
Average FRB cash and FHLB stock		52,603		61,082		97,036		99,118		54,677		70,175		58,870
Average non-accrual loans and leases		18,954		19,807		20,540		18,602		15,775		19,761		7,702
Adjusted average interest-earning assets (d)		$3,333,977		$3,266,138		$3,177,141		$3,081,765		$2,968,324		$3,259,363		$2,840,302
Net interest margin (a / c)		3.64%		3.65%		3.58%		3.69%		3.76%		3.62%		3.81%
Adjusted net interest margin (b / d)		3.51%		3.47%		3.43%		3.50%		3.66%		3.47%		3.68%

 

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Investor Presentation Third Quarter 2024

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

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Table of Contents Q3 2024 Results 4 Company Snapshot 5 Strategic Plan 6 Why FBIZ? 10 Drivers of Growth & Profitability 18 Appendix 27

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Strong bottom line profitability reflects success of efforts to grow loans and deposits, produce positive operating leverage, sustain a strong and stable margin, and maintain solid asset quality Prudent balance sheet management supported a stable NIM of 3.64%, within the Bank’s target range Net interest income grew 1.5% from Q2 2024 and 8.4% from the Q3 2023 Continued deposit and loan growth Deposits grew 11.8% annualized from Q2 2024 and 11.8% from Q3 2023 Loans grew 8.7% annualized from Q2 2024 and 10.3% from the Q3 2023 Robust Private Wealth Management business delivered 16.6% growth in assets under management and administration (“AUM&A”) compared to Q3 2023 PWM fee income totaled $3.3 million for Q3 2024, up 10.8% over Q3 2023 NPAs as a % of total assets were 0.52%, compared to 0.53% for Q2 2024 and 0.52% for Q3 2023 Strong earnings generation produced a 11.5% annualized increase in tangible book value per share compared to the linked quarter and 12.5% compared to the prior year quarter Net Income $10.3 MM Private Wealth $3.4 B in AUM&A Deposits + 12% Loans +9% NIM In 3.60%-3.65% Target Range TBV per Share +12% Third Quarter 2024 Highlights Stable net interest margin, continued balance sheet growth, and positive operating leverage support tangible book value expansion Note: Percentages represent growth over the prior quarter. Asset Quality

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Serving unique needs of business executives, entrepreneurs, and high net worth individuals through Business Banking, Private Wealth, and Bank Consulting Within Business Banking, our commercial banking offerings are focused on our stable and attractive Midwest markets while Specialty Finance products and services have national reach Efficient and highly scalable model with very limited branch network and exceptional digital capabilities Headquarters: Madison, WI Mission: Build long-term shareholder value as an entrepreneurial banking partner that drives success for businesses, investors, and our communities FBIZ Business Banking2 $3.7 Billion3 FBIZ Private Wealth $3.4 Billion3 IN ASSETS UNDER MANAGEMENT & ADMINISTRATION Market capitalization as of 10/23/2024. Consists of all on-balance sheet assets for First Business Financial Services, Inc. on a consolidated basis. Data as of 9/30/2024. 5 IN TOTAL ASSETS First Business Bank NASDAQ: FBIZ — $368 million Market Cap1

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Five Year Strategic Plan

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

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2024-2028 Goals & Progress Plan aims to deliver above average total shareholder return compared to peer median Represents data from the 2023 employee engagement survey. Net promoter score assesses likelihood to recommend on an 11-point scale, where detractors (scores 0-6) are subtracted from promoters (scores 9-10), while passives (scores 7-8) are not considered. See appendix for additional information on the source of the net promoter score. Represents data from the 2023 survey. Goals 2024-2028 September 2024 YTD ROATCE ≥15% by 2028 13.4% TBV Growth ≥10% per year 11.1% Revenue Growth ≥10% per year 4.7% Efficiency Ratio <60% by 2028 62.04% Core Deposits to Total Funding ≥75% 73% Employee Engagement & Participation1 ≥85% 90% Net Promoter Score2 ≥70 78

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Note: Peer Group defined as publicly traded banks with total assets between $1.75 billion and $7.0 billion. Peer data not yet available for 3Q24. 1-Year, 3-Year, and 5-Year TSR is through 9/30/2024. Data as of 6/30/2024. Total Shareholder Return Above Peer Group Median Despite recent outperformance, Price/LTM EPS remains below peers

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WHY FBIZ?

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Growing Profitability FBIZ’s Historic and Ongoing Growth Supports Earnings Power Differentiated Loan Growth Capabilities History of consistent double-digit growth Growth is C&I focused and diversified   Solid credit quality due to deep client relationships, strong underwriting, and niche business expertise Strong & Stable Deposit Franchise Track record of double-digit growth driven by deep client relationships Creates relatively stable and strong NIM in a challenging environment (3.64% MRQ) Deposit-centric culture led by treasury management sales also drives meaningful service charge income Growing Profitability Profile Significant fee revenue contribution from Private Wealth business History of long-term positive operating leverage Consistent double-digit TBV growth History of double-digit top line revenue growth 12% 5-year Loan CAGR 2018-2023 15% 5-year Core Deposit CAGR 2018-2023 11% 5-year TBV/Share CAGR 2018-2023

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Balanced and Steady Growth Operating Fundamentals Drive Earnings Power Note: Net interest income is the sum of "Pure Net Interest Income" and "Fees in Lieu of Interest". Non-interest income is the sum of "Private Wealth Management Service Fees", "Other Fee Income", "Service Charges", "SBA Gains", and "Swap Fees". "Pure Net Interest Income" and "Net Operating Income" are non-GAAP measurements. See appendix for non-GAAP reconciliation schedules. "Net Tax Credits" represent management's estimate of the after-tax contribution related to the investment in tax credits as of the reporting period disclosed. "Fees in Lieu of Interest" is defined as prepayment fees, asset-based loan fees, non-accrual interest, and loan fee amortization. Steady revenue expansion supported by: Double-digit loan and deposit growth Strong and stable net interest margin Diverse sources of non-interest income, including service fees from our Private Wealth Management business which comprises 46% of total non-interest income Strategic investments drive growth while maintaining positive long-term operating leverage Strong earnings power reflected in trailing twelve-month PTPP Adjusted ROAA of 1.63% as of 9/30/2024. 5 Net Operating Income Year CAGR = XX% Operating Income Highlights

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

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Disciplined Interest Rate Risk Management Match-Funding Strategy Insulates Balance Sheet throughout Various Rate Cycles Methodical Approach Individually match-fund loans with maturities over 5 years and amounts greater than $5MM Portfolio match-funding in various terms against the fixed-rate loan portfolio with maturities under 5 years and amounts less than $5MM ~$10-$25 million of monthly wholesale funding maturities to effectively manage the liquidity requirements of the match-funding strategy Floating Rate Portfolio Floating portfolio is predominantly indexed to SOFR, which aligns with the Bank’s SOFR-indexed and managed rate non-maturity deposit portfolio 54% as of 9/30/24 Balances as of 9/30/24: Fixed Rate Portfolio Wholesale funding used to match maturities and cash flows on long-term fixed rate loans 46% as of 9/30/24 This locks in interest rate spread and maintains greater stability in net interest margin 46% Fixed Rate Loans as of 9/30/24 54% Variable Rate Loans as of 9/30/24 Loans Deposits SOFR = $1.249 B SOFR = $616.6 MM Prime = $400.0 MM Managed rate, non-maturity = $1.130 B

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Operating Leverage Outperforms Peers History of Growing Revenues Faster than Expenses Note: Peer group defined as publicly traded bank with total assets between $1.75 billion and $7 billion. 1Q24, 2Q24, and 3Q24 represent data for the trailing 12 months. Peer data not yet available for 3Q24. Operating leverage is defined as the percent growth in operating revenue less the percent growth in operating expenses. We aim to achieve 10% revenue growth on an annual basis, with positive operating leverage Atypically high net interest margin ("NIM") in 2023 creates temporary positive operating leverage headwind as NIM returns to normalized levels in 2024 We expect positive annual operating leverage will resume in 2025 Strategic initiatives directed toward revenue growth and operating efficiency through use of technology have generated positive operating leverage on an annual basis Initiatives include: Expanding higher-yielding C&I lending business lines Strong focus on treasury management and growing core deposits Increasing our commercial banking market share outside of Madison Scaling our Private Wealth Management business in our less mature commercial banking markets Robotic process automation implementation AI usage discovery and roll out 1 FBIZ Avg = 2.5% Peer Avg = -3.6%

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Growth and Profitability Exceeds Peers Top Line Revenue Growth and Efficient Capital Management Drives Strong Profitability Note: Peer group defined as publicly traded bank with total assets between $1.75 billion and $7 billion. Peer data not yet available for 3Q24. 1. 1Q24, 2Q24, and 3Q24 represent data for the trailing 12 months. 1

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Shareholder Value Creation History of Steady, Consistent TBV and Dividend Growth Through Economic and Interest Rate Cycles TBV 5YR CAGR = 11% Div/Share 5YR CAGR = 11% Q3 2024 dividends per share calculation is annualized. CAGR = 11%

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Drivers of Growth & Profitability

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Relationship Banking Key to Success Solid Core Deposit Growth Despite Banking Industry Trends Long-term client relationships drive core deposit growth, aided by clients’ comfort with utilizing the Bank’s longstanding extended deposit insurance products Successful execution of client deposit initiatives has attracted new relationships and increased gross treasury management service charges Long-held top-quartile deposit pricing strategy promotes retention Net Promoter Score1 of 78 is well above industry benchmark score of 23. 1. Net promoter score benchmarks reported in “The State of B2B Account Experience: B2B NPS & CX Benchmarking Report,” CustomerGauge, 2021 NPS benchmarks reported in “The State of B2B Account Experience: B2B NPS & CX Benchmarking Report,” CustomerGauge, 2021. Net promoter score assesses likelihood to recommend on an 11-point scale, where detractors (scores 0-6) are subtracted from promoters (scores 9-10), while passives (scores 7-8) are not considered. The score ranges from -100 to +100. Net promoter score assesses likelihood to recommend on an 11-point scale, where detractors (scores 0-6) are subtracted from promoters (scores 9-10), while passives (scores 7-8) are not considered. See appendix for additional information on the source of the net promoter score. Growth over prior year quarter = 13% Growth over prior year quarter = 10%

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

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Deposit-Centric Strategy Key to Growth Double Digit Core Deposit Growth Supports Double Digit Loan Growth Core deposits defined as total deposits less wholesale deposits. Period end balances are presented. Deposit growth remains one of our major strategic priorities under our new 5-year plan Deposit-centric sales strategy led by treasury management sales located in all bank markets with direct production and outside calling goals Bankers trained to fund their loan production with deposit growth goals Deposit-focused individual banker incentive compensation and bank level bonus plans 5YR CAGR = 11.4% DDA 5-Year CAGR = 10% Total Core Deposits 5-Year CAGR = 15%

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Diversified Lending Growth Continuing to Grow Higher Yielding C&I Lending Mix Period end balances excluding PPP loans are presented. On January 1, 2023, the Bank adopted ASU 2016-03 Financial Instruments - Credit losses (“ASC 326”). The Bank adopted ASC 326 using the modified retrospective method which does not require restatement of prior periods. The balances as of December 31, 2023 reflect a reclassification of $43 million to commercial and industrial from commercial real estate, and $7 million from consumer and other to commercial real estate. Average balances excluding PPP loans are presented. Excluding the impact of PPP loan fees and interest income 5 Year CAGR = 12% Exceeds strategic plan goal of 10%

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Robust Profitability Metrics Strong Balance Sheet Growth and Resilient Net Interest Margin Support Robust PTPP Adjusted ROAA Note: Peer group defined as publicly-traded bank with total assets between $1.75 billion and $7 billion. Peer data not yet available for 3Q24. "Core Net Interest Margin" is a non-GAAP measurement. See appendix for non-GAAP reconciliation schedules. "Recurring, variable components" is defined as fees in lieu of interest, FRB interest income, and FHLB dividend income. "PTPP ROAA" is a non-GAAP measurement. See appendix for non-GAAP reconciliation schedules.

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

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Solid Asset Quality Non-Performing Assets/Total Assets Remain Well Managed Note: Peer group defined as publicly-traded bank with total assets between $1.75 billion and $7.0 billion. Peer data not yet available for 3Q24. Represents a fully collateralized ABL credit, for which the Company expects full repayment. Excluding this credit, non-performing assets totaled $13.0 million, or 0.35% of total assets. For more detailed definitions on credit quality categories see the Bank's 10-K filed with the SEC on February 28, 2024. As of 9/30/2024, 95% of the loan portfolio was classified in category I(2) and 99% of loans were current. In the ABL pool, we continue to expect full repayment related to the second quarter 2023 $10.9 million default, now paid down to $6.4 million. Excluding this credit, non-performing assets totaled $13.0 million, or 0.35% of total assets. Isolated weakness in the $50 million transportation segment of the Equipment Finance portfolio. 

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Maturing Over Time Equipment Finance Portfolio by Industry For more detailed definitions on credit quality categories see the Bank's 10-Q filed with the SEC on July 26, 2024. Category IV represents non-performing loans. Equipment Finance Portfolio Analysis Strong and diversified portfolio; Transportation sub-category showing sector-specific weakness Asset Quality Breakdown1 Equipment Finance (EF) loans diversified across industries EF comprised 26% of C&I loans and 10% of Total Loans at 9/30/2024 Transportation sector comprised 15% of EF, 4% of C&I, and 1.5% of Total Loans Stable asset quality in EF portfolio excluding Transportation sector, which is experiencing isolated industry weakness Equipment Finance excl. Transportation 12/31/2022 12/31/2023 9/30/2024 Total Portfolio $147.0 MM $226.4 MM $265.3 MM Category I 96% 96% 98% Category II 2% 1% 0% Category III 1% 1% 1% Category IV 1% 2% 1% Transportation 12/31/2022 12/31/2023 9/30/2024 Total Portfolio $50.8 MM $60.9 MM $45.7 MM Category I 98% 90% 88% Category II 1% 1% 0% Category III 0% 2% 2% Category IV 1% 7% 10%

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APPENDIX SUPPLEMENTAL DATA & NON-GAAP RECONCILIATIONS

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

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Superior Client Satisfaction Rating Excellent Employee Satisfaction Drives Superior Client Satisfaction 1. Moses & Associates, 2023, 2. J.D. Power, 2022, 3. Qualtrics XM Institute, 2022, 4. Statista, 2023 Note: Net promoter score assesses likelihood to recommend on an 11-point scale, where detractors (scores 0-6) are subtracted from promoters (scores 9-10), while passives (scores 7-8) are not considered. The score ranges from -100 to +100. Striving for Continuous Improvement Net Promoter Score is the most widely used measure of likelihood to recommend a company to others Anonymous survey conducted annually by a third party to assess client satisfaction Allows us to compare our performance against other leading financial institutions Employee Engagement Performance Enablement Manager Effectiveness Belonging

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ESG Framework Environmental, social, and governance practices are integrated into our core business strategy Branch-lite model with only one location in each of the banking markets we serve Support hybrid and remote work options to reduce carbon emissions related to commuting (even prior to COVID) Reduced paper usage via implementation of Docusign Minimal technology eco-footprint by continued use of state-of-the art technology to minimize power consumption Annually recycle company-generated and employee-owned e-waste Employee e-waste recycling is now offered year-round Named to the national list of Top Workplaces USA for the third straight year Awarded nine culture of excellence awards by Top Workplaces Increased advisory board diversity (to over 40%) to enhance our business development efforts with a diverse client base in all markets Provide all employees with 8 hours of paid time to support volunteer efforts and give back to their communities in a meaningful way of their choosing Corporate Governance and Nominating Committee monitors key governance structure risks, effectiveness of the Board DEI policy practices and strategies, and oversight of the overall ESG program To ensure alignment with the Company's ESG principles, responsibility for Board delegated ESG risks and opportunities are defined in all committee charters Board diversity – 33% female and 10% ethnic or racial directors and 75% of standing committees chaired by female directors 90% director independence, and 100% committee membership independence

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Robust Liquidity and Capital Base Stable Core Deposit Base Substantial Liquidity Strong Capital Ratios (%) Source 9/30/2024 Short-term Investments $86,670 Collateral value of unencumbered pledged loans 397,852 Market value of unencumbered securities 279,191 Readily accessible liquidity 763,713 Fed fund lines 45,000 Excess brokered CD capacity (1) 1,102,767 Total Liquidity 1,911,480 Uninsured Deposits Collateralized Public Funds FDIC Insured Approximately 65% of deposits are insured or collateralized 1. Bank internal policy limits brokered CDs to 50% of total bank funding when combined with FHLB advances.

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Capital Strength 9/30/24 6/30/24 3/31/24 12/31/23 9/30/23 Total Regulatory Capital $407,421 $392,359 $384,083 $375,440 $365,058 Total Risk-Weighted Assets $3,477,734 $3,425,925 $3,381,059 $3,356,247 $3,259,956 Leverage Ratio 8.68% 8.51% 8.45% 8.43% 8.65% Common Equity Tier 1 Capital Ratio 8.76% 8.64% 8.51% 8.38% 8.37% Tier 1 Ratio 9.11% 8.99% 8.86% 8.74% 8.74% Total Capital Ratio 11.72% 11.45% 11.36% 11.19% 11.20% Total Shareholders' Equity $311,982 $305,170 $297,788 $289,588 $280,758 Tangible Common Shareholders' Equity $288,156 $281,337 $273,846 $265,573 $256,656 Total Shares Outstanding 8,295,017 8,294,589 8,306,573 8,314,778 8,315,186 Book Value Per Share $36.2 $35.4 $34.4 $33.4 $32.3 Tangible Book Value Per Share $34.7 $33.9 $33.0 $31.9 $30.9 Cash Dividends Per Share $0.25 $0.25 $0.25 $0.2275 $0.2275 Regulatory capital ratios remain solid including a Total Capital Ratio of 11.72% and a Tier 1 Ratio of 9.11%. Tangible book value per share increased 10% annualized from the prior quarter and 13% from the prior year quarter. Quarterly cash dividend of $0.25 per share. HIGHLIGHTS

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Balanced Deposit Portfolio Diversified Product Base with Long-Tenured, Deep Client Relationships Longstanding deposit insurance options available through IntraFi and Reich & Tang to provide further security for our large clients Funding is augmented by non-callable wholesale deposits rather than non-relationship sourced funds Our deposit relationships span multiple industry segments Diverse deposit base has an average deposit relationship tenure of over 10 years History of offering competitive deposit rates supported by growth in higher-yielding commercial & industrial lending Nearly 50% of the top 50 deposit relationships also have a commercial loan relationship

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Diversified Lending Products Double digit loan growth driven by stellar performance across all areas of the bank Note: Period end balances as of 9/30/2024 presented.

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

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Office loans focused in our bank markets and concentrated in Wisconsin Exceptional asset quality with no non-performing office loans in the portfolio 92% of all office loans have recourse Office loans consist of 66% Class A space Office represents 9% of total loans as of 9/30/24 Majority of office loan maturity terms are 2031 and beyond All office loans with 2031+ maturities are conventional fixed rate or fixed to the client via an interest rate swap Note: The office specific loan data presented in charts on this slide represents office loans greater than $3 million, which represents 75% of total office loans. Source: Q3 2024 CoStar market reports. For more detailed definitions on credit quality categories see the Bank's 10-K filed with the SEC on February 21, 2024. CRE Office Portfolio Analysis Exceptional credit quality on office loans throughout the Midwest Vacancy Rates: Madison = 6.0% Milwaukee = 11.4% Kansas City = 11.9% National = 13.9%

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Loans focused in our bank markets and concentrated in Wisconsin Exceptional asset quality with no non-performing loans in the portfolio Represents 16% of total loans 90% of all multi-family loans have recourse All multi-family loans with 2031+ maturities are conventional fixed rate or fixed to the client via an interest rate swap Source: Q3 2024 CoStar market reports. For more detailed definitions on credit quality categories see the Bank's 10-K filed with the SEC on February 21, 2024. Multi-Family Portfolio Analysis Exceptional credit quality on Multi-Family loans throughout the Midwest Vacancy Rates: Madison = 4.5% Milwaukee = 4.9% Kansas City = 7.6% National = 7.8%

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

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

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

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“Core Net Interest Margin” is a non-GAAP measure representing net interest income excluding the fees in lieu of interest and other recurring, but volatile, components of net interest margin divided by average interest-earning assets excluding other recurring, but volatile, components of average interest-earning assets. Fees in lieu of interest are defined as prepayment fees, asset-based loan fees, non-accrual interest, and loan fee amortization. In the judgment of the Company’s management, the adjustments made to net interest income allow investors and analysts to better assess the Company’s net interest income in relation to its core client-facing loan and deposit rate changes by removing the volatility that is associated with these recurring but volatile components. The information provided below reconciles the net interest margin to its most comparable GAAP measure. Core Net Interest Margin Non-GAAP Reconciliation                                                                                                                                                                                                      For the Three Months Ended (Dollars in Thousands) September 30, 2023 December 31, 2023 March 31, 2024 June 30, 2024 September 30, 2024 Interest income $50,941 $54,762 $55,783 $57,910 $59,327 Interest expense 22,345 25,222 26,272 27,370 28,320 Net interest income 28,596 29,540 29,511 30,540 31,007 Less fees in lieu of interest 582 1,075 793 1,227 942 Less FRB interest income and FHLB dividend income 870 1,466 1,436 959 841 Adjusted net interest income $27,144 $26,999 $27,282 $28,354 $29,224 Average interest-earning assets $3,038,776 $3,199,485 $3,294,717 $3,347,027 $3,405,534 Less Average FRB cash and FHLB stock 54,677 99,118 97,036 61,082 52,603 Less Average non-accrual loans and leases 15,775 18,602 20,540 19,807 18,954 Adjusted average interest-earning assets $2,968,324 $3,081,765 $3,177,141 $3,266,138 $3,333,977 Net interest margin 3.76% 3.69% 3.58% 3.65% 3.64% Adjusted net interest margin 3.66% 3.50% 3.43% 3.47% 3.51%

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"Pure Net Interest Income" is defined as net interest income less fees in lieu of interest. "Fees in Lieu of Interest" is defined as prepayment fees, asset-based loan fees, non-accrual interest, and loan fee amortization. We believe that this measure is important to many investors in the marketplace who are interested in the trends in our net interest margin. In compliance with applicable rules of the SEC, this non-GAAP measure is reconciled to net interest income, which is the most directly comparable GAAP financial measure. Pure Net Interest Income Non-GAAP Reconciliation                                                                                                                                                               For the Year Ended Trailing 12 Months (Dollars in Thousands) December 31, 2019 December 31,2020 December 31,2021 December 31,2022 December 31,2023 Q3 2024 Net Interest income $69,855 $77,071 $84,662 $98,422 $112,588 $120,598 Less fees in lieu of interest 6,479 9,300 11,160 5,283 3,244 4,036 Pure net interest income (non-GAAP) $63,376 $67,771 $73,502 $93,139 $109,344 $116,562

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"Net Operating Income" is a non-GAAP financial measure. We believe net operating income allows investors to better assess the Company’s operating expenses in relation to its top line revenue by removing the volatility that is associated with certain one-time and other discrete items. In compliance with applicable rules of the SEC, this non-GAAP measure is reconciled to net income, which is the most directly comparable GAAP financial measure. Net Operating Income Non-GAAP Reconciliation                                                                                                                                                                                              For the Year Ended     Trailing 12 Month (Dollars in Thousands) December 31, 2019 December 31, 2020 December 31, 2021 December 31, 2022 December 31, 2023 September 30, 2024 Net income $23,324 $16,978 $35,755 $40,858 $37,027 $39,600 Less income tax expense (1,175) (1,327) (11,275) (11,386) (10,112) (8,723) Less provision for credit losses (2,085) (16,808) 5,803 3,868 (8,182) (8,698)    Income before taxes and provision for credit losses (non-GAAP) 26,584 35,113 41,227 48,376 55,321 57,021 Less non-operating income    Net gain on sale of state tax credits - 275 - - -    BOLI death benefit - - - 809 -    Net (loss) gain on sale of securities (46) (4) 29 - (45) (8) Total non-operating income (non-GAAP) (46) 271 29 809 (45) (8) Less non-operating expense    Net loss on repossessed assets 224 383 15 49 12 167    Amortization of other intangible assets 40 35 25 - -    Contribution to First Business Charitable Foundation - - - 809 -    SBA recourse (benefit) provision 188 (278) (76) (188) 775 792    Tax credit investment impairment (recovery) 4,094 2,395 - 351 -    Loss on early extinguishment of debt - 744 - - - Total non-operating expense (non-GAAP) 4,546 3,279 (36) 319 787 959 Add net tax credit benefit (non-GAAP) 1,352 969 - 338 1,206 1,235 Net operating income $32,528 $39,090 $41,162 $48,224 $57,359 $59,223

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“Pre-tax, pre-provision adjusted return on average assets” is defined as operating revenue less operating expense divided by average total assets. In the judgment of the Company’s management, the adjustments made to non-interest expense and non-interest income allow investors and analysts to better assess the Company’s operating expenses in relation to its core operating revenue by removing the volatility that is associated with certain one-time items and other discrete items. Adjusted PTPP ROAA Non-GAAP Reconciliation  (Unaudited)                                                                                                                                                                                For the Three Months Ended (Dollars in Thousands) September 30, 2023 December 31, 2023 March 31, 2024 June 30, 2024 September 30, 2024 Total non-interest expense $23,189 $21,588 $23,342 $23,879 $23,107    Less:      Net loss (gain) on repossessed assets 4 4 86 65 (12)      SBA recourse provision (benefit) 242 210 126 (9) 466      Contribution to First Business Charitable Foundation - - - Total operating expense $22,943 $21,374 $23,130 $23,823 $22,653 Net interest income $28,596 $29,540 $29,511 $30,540 $31,007 Total non-interest income  8,430 7,094 6,757 7,425 7,064    Less:      Bank-owned life insurance claim - - -      Net loss on sale of securities - - (8) - - Adjusted non-interest income 8,430 7,094 6,765 7,425 7,064 Total operating revenue $37,026 $36,634 $36,276 $37,965 $38,071 Pre-tax, pre-provision adjusted earnings $14,083 $15,260 $13,146 $14,142 $15,418 Average total assets $3,276,240 $3,454,652 $3,527,941 $3,592,215 $3,636,887 Pre-tax, pre-provision adjusted return on average assets 1.72% 1.77% 1.49% 1.57% 1.70%

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‘‘Cost of Funds’’ is defined as total interest expense on deposits and FHLB advances, divided by the sum of total average deposits and average FHLB advances. We believe that this measure is important to many investors in the marketplace who are interested in the trends in our bank funding costs. The information provided below reconciles the cost of funds to its most comparable GAAP measure. Cost of Funds Non-GAAP Reconciliation                                                                                                                                                                                                                                             For the Three Months Ended (Dollars in Thousands) September 30, 2023 December 31, 2023 March 31, 2024 June 30, 2024 September 30, 2024    Interest expense on total interest-bearing deposits $19,803 $22,644 $23,837 $24,676 $25,290    Interest expense on FHLB advances 2,117 1,851 1,717 1,974 2,059    Total interest expense on deposits and FHLB advances $21,920 $24,495 $25,554 $26,650 $27,349 Average interest-bearing deposits $2,081,880 $2,249,701 $2,360,573 $2,414,282 $2,466,313 Average non-interest-bearing deposits 434,330 448,818 443,416 436,968 440,161 Average FHLB advances 342,117 301,773 287,307 294,043 278,103    Total average deposits and total average FHLB advances $2,858,327 $3,000,292 $3,091,296 $3,145,293 $3,184,577 Cost of funds 3.07% 3.27% 3.31% 3.39% 3.44%

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v3.24.3

Cover	Oct. 24, 2024
Cover [Abstract]
Document Type	8-K
Amendment Flag	false
Document Period End Date	Oct. 24, 2024
Entity File Number	001-34095
Entity Registrant Name	First Business Financial Services, Inc.
Entity Central Index Key	0001521951
Entity Tax Identification Number	39-1576570
Entity Incorporation, State or Country Code	WI
Entity Address, Address Line One	401 Charmany Drive
Entity Address, City or Town	Madison
Entity Address, State or Province	WI
Entity Address, Postal Zip Code	53719
City Area Code	608
Local Phone Number	238-8008
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	Common Stock, $0.01 par value
Trading Symbol	FBIZ
Security Exchange Name	NASDAQ
Entity Emerging Growth Company	false

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