NB Bancorp, Inc. Reports Fourth Quarter 2025 Financial Results, Declares Quarterly Cash Dividend, Announces Share Repurchase Plan

Share Repurchase Plan
The Company announced today that it has adopted a stock repurchase program for up to 2,288,509 shares of the Company's common stock, which equals approximately 5.0% of the shares currently outstanding. 

Declaration of Dividend
The Board of Directors declared a quarterly cash dividend of $0.07 per share, payable on February 19, 2026, to shareholders of record as of February 5, 2026.

MERGER WITH PROVIDENT BANCORP, INC. AND BANKPROV
On November 15, 2025, the Company completed its acquisition of Provident for $111.8 million in cash consideration and the issuance of 5,943,682 shares of common stock valued at $114.7 million.

The acquisition extends Needham Bank's presence in the southern New Hampshire market with the addition of approximately $1.42 billion of total assets, $1.23 billion of total loans and $1.13 billion in total deposits, each at fair value. See the Organic Loan Growth, Organic Deposit Growth and Merger & Acquisition Expenses tables for more information on the impact of the Provident acquisition. Fourth quarter results for 2025 reflect the inclusion of Provident since November 15, 2025.

SELECTED FINANCIAL HIGHLIGHTS FOR THE FOURTH QUARTER OF 2025

• Net income of $7.7 million, or $0.19 per diluted common share, compared to net income of $15.4 million, or $0.43 per diluted common share, for the prior quarter. Operating net income⁽¹⁾, excluding one-time charges, amounted to $21.2 million, or $0.51 per diluted common share, compared to operating net income⁽¹⁾ of $16.0 million, or $0.45 per diluted common share, for the prior quarter.

One-time charges during the current quarter include:

• • Pre-tax merger and acquisition costs of $15.7 million ($11.4 million net of tax) related to the Company's completed acquisition of Provident; and
  • Tax expense and a modified endowment contract penalty of $2.1 million related to the surrender of BOLI policies from policies acquired from BankProv.

One-time pre-tax amounts during the prior quarter include:

• • Merger and acquisition costs of $994 thousand ($766 thousand net of tax) related to the Company's pending acquisition of Provident; and
  • State voluntary disclosure agreement tax expenses of $561 thousand for new state income tax expenses; partially offset by
  • Defined benefit pension termination refund of $739 thousand.
    
    
• Net interest margin expanded by 14 basis points to 3.92% during the current quarter from 3.78% in the prior quarter.
• Acquisition and conversion of Provident was completed, resulting in loans acquired at fair value amounting to $1.23 billion and deposits assumed at fair value of $1.13 billion.
• Gross loans increased $1.27 billion, or 26.9%, to $5.99 billion, from $4.72 billion the prior quarter.
• Total deposits increased $1.29 billion, or 28.2%, from the prior quarter. Core deposits, which the Company considers to be all non-brokered deposits, increased $1.14 billion, or 27.3%, during the current quarter. Brokered deposits increased $147.0 million, or 37.8%, from the prior quarter.
• Book value per share and tangible book value per share⁽¹⁾ were $18.77 and $17.98, respectively, compared to $18.51 and $18.48, respectively, in the prior quarter. The decrease in tangible book value per share⁽¹⁾ was a result of the establishment of $16.8 million in goodwill and $18.3 million in core deposit intangible from the Provident acquisition, along with $2.7 million in dividends paid during the quarter, partially offset by $7.7 million in net income for the quarter.

BALANCE SHEET
Total assets amounted to $7.01 billion as of December 31, 2025, representing an increase of $1.56 billion, or 28.7%, from September 30, 2025.

• Cash and cash equivalents increased $112.2 million, or 38.0%, to $407.6 million from $295.4 million in the prior quarter, as a result of the organic increase in deposits of $199.3 million and cash acquired from Provident of $70.8 million, partially offset by the cash consideration for the acquisition of Provident of $111.8 million and organic loan growth of $43.6 million.
• Net loans increased $1.23 billion, or 26.3%, to $5.90 billion, from the prior quarter primarily from the $1.23 billion acquisition of Provident's loan portfolio at fair value. The current quarter increase was primarily seen in commercial real estate loans, which increased $474.4 million, or 32.7%, commercial and industrial loans, which increased $355.9 million, or 54.6%, mortgage warehouse loans, which increased $280.9 million, or 100.0%, multi-family residential loans, which increased $87.1 million, or 20.2%, construction and land development loans, which increased $75.6 million, or 11.5%, and residential real estate loans, which increased $56.9 million, or 4.5%, partially offset by a decline in consumer loans as $66.4 million in consumer loans were marked to fair value and transferred to loans held for sale during the quarter.
• Deposits increased $1.29 billion, or 28.2%, to $5.85 billion from $4.57 billion in the prior quarter, primarily from the $1.13 billion assumption of Provident's deposit portfolio at fair value. The increase in deposits was the result of increases in money market accounts of $437.3 million, or 36.0%, NOW accounts of $187.2 million, or 39.2%, certificates of deposit of $211.2 million, or 12.0%, brokered deposits of $147.0 million, or 37.8%, savings accounts of $88.2 million, or 73.2% and noninterest bearing demand deposits of $216.9 million, or 35.7%.
• FHLB borrowings increased $154.8 million, or 373.4%, to $196.2 million from $41.5 million in the prior quarter as a result of liquidity needs.
• Shareholders' equity increased $121.9 million, or 16.5%, to $858.9 million from the prior quarter, primarily as a result of the issuance of 5,943,682 shares of common stock for the acquisition of Provident, which increased shareholders' equity by $114.7 million, and net income of $7.7 million, partially offset by the payment of $2.7 million in dividends. Shareholders' equity to total assets and tangible shareholders' equity⁽¹⁾ to tangible assets were 12.3% and 11.8% respectively, at the end of the current quarter, compared to 13.5% for both ratios at the end of the prior quarter.

NET INTEREST INCOME
Net interest income was $58.8 million for the current quarter, compared to $48.2 million for the prior quarter, an increase of $10.6 million, or 22.0%. Net interest margin expanded 14 basis points to 3.92% for the quarter from 3.78% in the prior quarter. Accretion from loan purchase accounting provided an 11 basis point increase in net interest margin for the current quarter.

• The increase in interest income during the current quarter was primarily attributable to an increase in the average balance of loans.
• The increase in interest expense for the current quarter was primarily driven by increases in the average balances of money market and certificates of deposit and individual retirement accounts, partially offset by a decrease in the average balance of FHLB borrowings.

PROVISION FOR CREDIT LOSSES
Provision for credit losses decreased $2.5 million, or 176.1%, to a release of credit losses of $1.1 million for the current quarter, compared to a provision for credit losses of $1.4 million for the prior quarter.

• The release of credit losses on loans amounted to $1.6 million for the current quarter, compared to a provision of $1.0 million for the prior quarter, representing a decrease of $2.6 million, or 249.4%, primarily driven by a $66.4 million portfolio of consumer loans transferred to loans held for sale.
• The provision for credit losses on unfunded commitments was $493 thousand for the current quarter, compared to $355 thousand for the prior quarter, representing an increase of $138 thousand, or 38.9%, primarily driven by an increase in the balance of unfunded commitments during the current quarter.

NONINTEREST INCOME
Noninterest income was $4.4 million for the current quarter, compared to $3.7 million for the prior quarter, representing an increase of $720 thousand, or 19.6%.

• Swap contract income was $677 thousand for the current quarter, compared to $208 thousand in the prior quarter, representing an increase of $469 thousand, or 225.5%, due to increased swap contract demand.
• Customer service fees were $2.9 million for the current quarter, compared to $2.5 million in the prior quarter, representing an increase of $398 thousand, or 15.9%, due to increased customer transactional volume.
• The increase in the cash surrender value of BOLI was $844 thousand for the current quarter, compared to $631 thousand for the prior quarter, representing a larger increase in the cash surrender value of BOLI of $213 thousand, or 33.8%, driven by the acquisition of BOLI policies from Provident during the current quarter.
• Other income was $442 thousand, compared to $152 thousand in the prior quarter, resulting in an increase of $290 thousand, or 190.8%, from the recognition of preferred dividends from solar tax credit investments during the current quarter.
• The above increases were offset by a $564 thousand increase in the loss on sale of loans, net, resulting from the adjustment to record a $66.4 million consumer loan portfolio at fair value, which transferred to loans held for sale during the quarter.

NONINTEREST EXPENSE
Noninterest expense for the current quarter was $49.3 million, representing an increase of $18.8 million, or 61.8%, from the prior quarter.

• Merger and acquisition expenses were $15.7 million for the current quarter, compared to $994 thousand for the prior quarter, representing a $14.7 million, or 1,483.5%, increase due to the completion of the Provident acquisition. See the Merger & Acquisition Expense table for a breakout of expenses.
• Salaries and employee benefits expenses were $21.1 million for the current quarter, compared to $18.6 million for the prior quarter, representing a $2.5 million, or 13.4%, increase resulting from increased headcount from the Provident acquisition and related incentives.
• General and administrative expenses were $2.8 million for the current quarter, compared to $1.6 million for the prior quarter, representing an increase of $1.2 million, or 76.8%, mainly a result of the amortization of the acquired Provident core deposit intangible and amortization of tax credits.

INCOME TAXES
Income tax expense for the current quarter was $7.2 million, representing a $2.6 million, or 56.0%, increase from the prior quarter. The increase was primarily driven by the BOLI surrender tax and modified endowment contract penalty of $2.1 million, as well as non-deductible acquisition expenses of $871 thousand. The effective tax rate and the operating effective tax rate⁽¹⁾ were 48.2% and 30.8%, respectively, for the current quarter, compared to 23.0% and 20.8%, respectively, for the prior quarter. The primary drivers of the increase in the effective tax rate were the BOLI surrender tax and modified endowment contract penalty of $2.1 million, as well as non-deductible acquisition expenses and related compensation of $871 thousand.

COMMERCIAL REAL ESTATE PORTFOLIO
Commercial real estate loans increased $561.5 million, or 29.9%, to $2.44 billion, during the current quarter.

• Cannabis facility commercial real estate loans decreased $48.9 million, or 18.5%, to $215.0 million during the quarter ended December 31, 2025. The Company's cannabis facility commercial real estate portfolio is secured entirely by the underlying commercial real estate of the borrower operation, in addition to, in most cases, a lien on all business assets. The vast majority of the cannabis facility loan portfolio balances have a loan-to-value ratio of 65% or lower, with appraisal reports taking a blended approach (using both cannabis and non-cannabis use comparable real estate sales, which we believe are generally more conservative).
• The cannabis facility portfolio has geographic dispersion, with lower dollar exposure loans remaining local and larger dollar exposure loans generally tied to multi-state operators with a more national footprint. All cannabis facility loan relationships were current at the end of the current quarter.
• The Company's multi-family real estate loan portfolio increased $87.1 million, or 20.2%, during the current quarter to $517.5 million, as a result of construction and land development loans transitioning to permanent financing and continued originations. The Company's multi-family real estate loan portfolio consists of properties primarily located in the Greater Boston area, primarily all of which are adjustable-rate loans and all of which were performing at September 30, 2025.
• The Company's $286.3 million office portfolio consists principally of suburban Class A and B office space used as medical and traditional offices. The portfolio does not consist of high-rise towers located in Boston.
•  As a result of the Provident acquisition, self-storage facilities and recreation vehicle parks are new commercial real estate segments of $64.3 million and $89.3 million, respectively.

ASSET QUALITY

• The increase in the allowance for credit losses ("ACL") for the current quarter was the result of the Provident acquisition, including $39.9 million in reserves for purchased credit deteriorated ("PCD") loans and a purchase accounting adjustment of $8.0 million for the acquired non-PCD loan portfolio, both of which were recorded to Goodwill. These increases were partially offset by the movement of a $66.4 million consumer loan portfolio to loans held for sale and a charge-off on a previously reserved for commercial and industrial loan of $3.8 million.
• The ACL amounted to $85.0 million as of December 31, 2025, or 1.42% of total loans, compared to $43.1 million, or 0.91% of total loans at September 30, 2025. The Company recorded a release of credit losses of $1.1 million during the current quarter, which included a release of $1.6 million for loans and a provision of $493 thousand for unfunded commitments, compared to provisions for credit losses of $1.4 million during the prior quarter, which included a provision of $1.0 million for loans and a provision of $355 thousand for unfunded commitments. 
• Non-performing loans totaled $43.4 million as of December 31, 2025, an increase of $32.0 million, or 281.9%, from $11.4 million at the end of the prior quarter. The increase was primarily due to the increase in commercial and industrial loans on non-accrual of $31.6 million as a result of the Provident acquisition.
• During the current quarter, the Company recorded total net charge-offs of $4.4 million, or 0.32% of average total loans on an annualized basis, compared to net charge-offs of $590 thousand, or 0.05% of average total loans on an annualized basis, in the prior quarter. The increase in net charge-offs during the current quarter was primarily a result of a $3.8 million charge-off on a previously reserved for commercial and industrial loan.  
• As part of its ongoing credit risk management framework and prudent oversight, the Company periodically reviews lending relationships across all portfolios to ensure alignment with its risk appetite, regulatory expectations, and evolving market conditions. During 2025, the Bank exited two large cannabis-related lending relationships following a comprehensive credit assessment and risk review process. The exits were executed in an orderly manner and did not result in any principal loss and resulted in either default interest or fees paid as part of the exit. Management believes these actions demonstrate the Bank's continued commitment to proactive risk mitigation, disciplined underwriting standards, and sound credit administration practices.
• The Company's loan portfolio consists primarily of commercial real estate and multi-family loans, one-to-four-family residential real estate loans, construction and land development loans, commercial and industrial loans, mortgage warehouse loans and consumer loans. These loans are primarily made to individuals and businesses located in our primary lending market area, which is the Greater Boston metropolitan area and surrounding communities in Massachusetts, southern New Hampshire, eastern Connecticut and Rhode Island.

ABOUT NB BANCORP, INC.
NB Bancorp, Inc. (Nasdaq Capital Market: NBBK) is the registered bank holding company of Needham Bank. Needham Bank is headquartered in Needham, Massachusetts, which is approximately 17 miles southwest of Boston's financial district. Known as the "Builder's Bank," Needham Bank has been helping individuals, businesses and non-profits build for their futures since 1892. Needham Bank offers an array of tech-forward products and services that businesses and consumers use to manage their financial needs. Needham Bank also provides services to companies in the cannabis industry by providing loans and deposits, along with supporting payment platforms in this industry, such as Mosaic and Corduro.

We have the financial expertise typically found at much larger institutions and the local knowledge and commitment you can only find at a community bank. For more information, please visit https://NeedhamBank.com. Needham Bank is a member of FDIC.

Non-GAAP Financial Measures
In addition to results presented in accordance with accounting principles generally accepted in the United States of America ("GAAP"), this press release contains certain non-GAAP financial measures, including pre-provision net revenue, operating net income, operating pre-tax income, operating noninterest expense, operating noninterest income, operating effective tax rate, operating earnings per share, basic, operating earnings per share, diluted, operating return on average assets, operating return on average shareholders' equity, operating efficiency ratio, tangible shareholders' equity, tangible assets and tangible book value per share. The Company's management believes that the supplemental non-GAAP information is utilized by regulators and market analysts to evaluate a Company's financial condition and therefore, such information is useful to investors. These disclosures should not be viewed as a substitute for financial results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies. Because non-GAAP financial measures are not standardized, it may not be possible to compare these financial measures with other companies' non-GAAP financial measures having the same or similar names.

Forward-Looking Statements
Statements in this press release that are not historical facts are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and are intended to be covered by the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.

We may also make forward-looking statements in other documents we file with the Securities and Exchange Commission (the "SEC"), in our annual reports to our stockholders, in press releases and other written materials, and in oral statements made by our officers, directors or employees. You can identify forward-looking statements by the use of the words "believe," "expect," "anticipate," "intend," "estimate," "assume," "outlook," "will," "should," and other expressions that predict or indicate future events and trends and which do not relate to historical matters. Although the Company believes that these forward-looking statements are based on reasonable estimates and assumptions, they are not guarantees of future performance and are subject to known and unknown risks, uncertainties, and other factors. You should not place undue reliance on our forward-looking statements. You should exercise caution in interpreting and relying on forward-looking statements because they are subject to significant risks, uncertainties and other factors which are, in some cases, beyond the Company's control. The Company's actual results could differ materially from those projected in the forward-looking statements as a result of, among other factors, changes in general business and economic conditions on a national basis and in the local markets in which the Company operates, including changes which adversely affect borrowers' ability to service and repay loans; changes in customer behavior due to political, business and economic conditions, including inflation and concerns about liquidity; turbulence in the capital and debt markets; reductions in net interest income resulting from interest rate volatility as well as changes in the balances and mix of loans and deposits; changes in interest rates and real estate values; changes in loan collectability and increases in defaults and charge-off rates; decreases in the value of securities and other assets, adequacy of credit loss reserves, or deposit levels necessitating increased borrowing to fund loans and investments; risks related to the Company's acquisitions generally, including disruption to current plans and operations; difficulties in customer and employee retention; fees, expenses and charges related to these transactions being significantly higher than anticipated; unforeseen integration issues or impairment of other intangibles; and the Company's inability to achieve expected revenues, cost savings, synergies, and other benefits at levels or within the timeframes originally anticipated; changing government regulation; competitive pressures from other financial institutions; changes in legislation or regulation and accounting principles, policies and guidelines; cybersecurity incidents, fraud, natural disasters, and future pandemics; the risk that the Company may not be successful in the implementation of its business strategy; the risk that intangibles recorded in the Company's financial statements will become impaired; changes in assumptions used in making such forward-looking statements; and the other risks and uncertainties detailed in the Company's Form 10-K and updated by our Quarterly Report on Form 10-Q and other filings submitted to the SEC. These statements speak only as of the date of this release and the Company does not undertake any obligation to update or revise any of these forward-looking statements to reflect events or circumstances occurring after the date of this communication or to reflect the occurrence of unanticipated events.