Civista Bancshares, Inc. Announces Second-Quarter 2025 Financial Results of $0.71 per Common Share, up 58% or $0.26 per Common Share from Second-Quarter 2024

"Our strong second-quarter performance highlights continued momentum in net income and earnings per share," said Dennis G. Shaffer, CEO and President of Civista. "Earnings per share rose to $0.71, up from $0.66 in Q1 and $0.45 a year ago, reflecting the success of our strategic initiatives and our focus on disciplined growth, customer relationships, and long-term shareholder value."

"The announcement of our partnership with The Farmers Savings Bank marks an exciting step in expanding our presence in Northeast Ohio and reinforcing our foundation with a strong base of core deposits," said Shaffer. "This, along with our successful $80.5 million capital raise earlier this month, positions us well for future growth."

"We continue to maintain strong credit quality, which reflects the soundness of our underwriting and the strength of our customer relationships," said Shaffer. "As demand for housing and construction financing grows, we remain focused on providing tailored financial solutions that support the evolving needs of the communities we serve."

Results of Operations:
For the three-month periods ended June 30, 2025, March 31, 2025 and June 30, 2024 and the six-month periods ended June 30, 2025 and June 30, 2024.

Second-Quarter 2025 Highlights

• Diluted earnings per common share of $0.71, for the second quarter of 2025, compared to $0.45 per diluted share, for the second quarter of 2024, and $0.66 per diluted share in the first quarter of 2025.
• Net income of $11.0 million, an increase of 56% or $3.9 million compared to $7.1 million for the second quarter 2024, and $10.2 million in the first quarter of 2025.
• Net interest margin (tax equivalent) of 3.64%, compared to 3.09% for the second quarter of 2024.
• Net interest income of $34.8 million, up $7.1 million or 25.5% compared to the second quarter of 2024.
• 196 basis points cost of deposits for the second-quarter of 2025, down 4 basis points compared to the first-quarter of 2025, and 14 basis points lower than the 210 basis points in the second-quarter of 2024.
• 232-basis points cost of funds for the second-quarter of 2025, 30 basis points lower than the 262-basis points cost of funds in the second-quarter of 2024.
• Noninterest expense of $27.5 million, $0.9 million or 3.2% lower than the second quarter of 2024.
• Efficiency ratio of 64.5%, compared to 72.6% for the second quarter of 2024 and 64.9% for the first quarter of 2025.
• Total period end loan growth of $47.1 million from first quarter 2025.
• Return on Assets of 1.06%, compared to 0.72% for the second quarter of 2024.
• Return on Equity of 11.02%, compared to 7.77% for the second quarter of 2024.
• Allowance for credit losses on loans / total loans of 1.28%.
• Based on the June 30, 2025, market close share price of $23.20, the $0.17 second quarter dividend is equivalent to an annualized yield of 2.93% and a dividend payout ratio of 23.96%.
• The second-quarter included non-recurring items which positively impacted net income by approx. $0.9 million on a pre-tax basis, and $0.76 million on an after-tax basis.

 Assets

Total assets at June 30, 2025, were $4.2 billion, an increase of $39.2 million, or 0.9% from March 31, 2025, and $87.4 million, or 2.1%, from December 31, 2024.

• Loan and lease balances increased $47.1 million, or 1.5% since March 31, 2025, and $69.9 million, or 2.3% since December 31, 2024.
• Commercial Real Estate continued to grow due to consistent demand in the non-owner and owner occupied categories.
• Residential Real Estate has grown primarily due to more home construction loans as we meet the demand for housing and construction financing by our customers and communities.

Deposits & Borrowings

Total deposits at June 30, 2025, were $3.2 billion, a decrease of $42.7 million, or 1.32% from March 31, 2025, and a decrease of $15.7 million, or 0.5%, from December 31, 2024.  

• Noninterest-bearing demand deposits decreased $47.5 million from December 31, 2024, primarily due to a $51.9 million decrease in noninterest-bearing accounts related to commercial business deposits, partially offset by a $9.9 million increase in noninterest-bearing public funds.
• Interest-bearing demand deposits increased $13.5 million from December 31, 2024, primarily due to a $27.9 million increase in interest-bearing public funds, somewhat offset by a $6.4 million decrease in Jumbo now deposits.
• Savings and money markets decreased $26.3 million from December 31, 2024, primarily due to decreases of $8.3 million and $36.6 million in retail money market savings and ICS demand and money markets, respectively. This was partially offset by an increase of $20.1 million in business money market savings.
• Time deposits increased $90.7 million from December 31, 2024, primarily due to a $69.8 million increase in Jumbo certificates of deposit and a $29.0 million increase in retail time certificates, partially offset by a $5.5 million decrease in reciprocal deposits.
• Brokered deposits totaled $454.1 million at June 30, 2025, which included brokered certificate of deposits of $450.0 million and brokered money markets of $4.1 million. Brokered deposits decreased $46.1 million from December 31, 2024.
• FHLB overnight advances totaled $433.5 million on June 30, 2025, up $73.5 million from March 31, 2025, and $94.5 million from December 31, 2024.
• FHLB term advances totaled $1.1 million on June 30, 2025, down from $1.4 million March 31, 2025, and down from $1.5 million on December 31, 2024.

Net Interest Income and Net Interest Margin

Net interest income increased $7.1 million, or 25.5%, for the second quarter of 2025, compared to the same period last year.  In the second quarter of 2025, net interest income was increased by $1.6 million from non-recurring adjustments resulting from the Civista Leasing and Finance Division core system conversion. 

• Interest income increased $5.7 million for the second quarter of 2025, compared to the same period last year, attributed to average interest-earning assets increasing $224.8 million coupled with a 26-basis point increase in asset yield.
• Interest expense decreased $1.4 million for the second quarter of 2025, compared to the same period last year. This was due to a 107-basis point reduction in higher costing FHLB borrowings coupled with a 136-basis point reduction in time deposits mostly offset by $272.2 million average balance growth in total deposits, resulting in a net increase of $249.3 million in average interest-bearing liabilities when comparing the second quarter of 2025 to the same period last year.
• Net interest margin increased 55-basis points to 3.64% for the second quarter of 2025, compared to 3.09% for the same period last year.

Net interest income increased $11.5 million, or 20.4%, for the six months ended June 30, 2025, compared to the same period last year. For the six months ended June 30, 2025, net interest income was increased by $1.6 million from non-recurring adjustments resulting from the Civista Leasing and Finance Division core system conversion.

• Interest income increased $9.3 million for the six-months ended June 30, 2025, compared to the same period last year, attributed to average interest-earning assets increasing $237.1 million coupled with a 15-basis point increase in asset yield.
• Interest expense decreased $2.2 million for the six months ended June 30, 2025, compared to the same period last year. This was due to a 106-basis point reduction in higher costing FHLB borrowings coupled with a 125-basis point drop in time deposits, mostly offset by $262.5 million average balance growth in deposits, resulting in a net increase of $267.6 million in average interest-bearing liabilities when comparing the six-months ended June 30, 2025, to the same period last year.
• Net interest margin increased 41-basis points to 3.57% for the six months ended June 30, 2025, compared to 3.16% for the same period last year.

Credit

Provision for credit losses (including provision for unfunded commitments) decreased $0.7 million for the second quarter of 2025 to $1.0 million compared to $1.7 million for the same period last year, and decreased $0.6 million compared to $1.6 million in the first quarter of 2025.

• Civista recorded net charge-offs of $1.0 million for the second quarter of 2025 compared to net charge-offs of $0.7 million for the same period of 2024, and $0.6 million in the first quarter of 2025.
• The allowance for credit losses to loans ratio was 1.28% at June 30, 2025, compared to 1.30% at March 31, 2025, and 1.29% at December 31, 2024.
• Non-performing assets at June 30, 2025, were $23.2 million, a decrease of $8.0 million or 25.7%, from March 31, 2025. The non-performing assets to assets ratio was 0.55% at June 30, 2025, and 0.75% at March 31, 2025. The decrease was primarily related to a loan pay-off occurring within the second quarter of 2025.
• The allowance for credit losses to non-performing loans increased to 176.1% at June 30, 2025, from 120.8% at December 31, 2024.

Noninterest Income

Noninterest income totaled $6.6 million, a decrease of $3.8 million or 36.5%, when compared to the same period last year.  In the second quarter of 2025, noninterest income was reduced by $1.0 million from non-recurring adjustments resulting from the Civista Leasing and Finance Division core system conversion. 

• Net gain/(loss) on equity securities decreased $0.1 million for the second quarter of 2025, compared to the same period last year, resulting from market valuation adjustments.
• Lease revenue and residual income decreased $3.0 million for the second quarter of 2025 compared to the same period last year, mainly due to stronger lease originations in 2024 coupled with a one-time non-recurring adjustment aforementioned above.
• Other income decreased $0.6 million for the second quarter of 2025 compared to the same period last year, primarily related to lower fee revenue from CLF.

Noninterest income totaled $14.4 million, a decrease of $4.2 million or 22.5%, when compared to the same period last year. For the six months ended June 30, 2025, noninterest income was reduced by $1.0 million from non-recurring adjustments resulting from the Civista Leasing and Finance Division core system conversion.  

• Net gain on sale of loans decreased $0.3 million for the six months ended June 30, 2025, compared to the same period last year, resulting from timing of selling loans.
• Lease revenue and residual income decreased $2.8 million for the six months ended June 30, 2025, compared to the same period last year, due to stronger lease originations in 2024 coupled with a one-time non-recurring adjustment aforementioned above.
• Other income decreased $1.3 million for the six month ended June 30, 2025, compared to the same period last year, primarily related to lower fee revenue from the leasing division.

Noninterest Expense

Noninterest expense totaled $27.5 million, a decrease of $0.9 million or 3.2%, when compared to the same period last year.  In the second quarter of 2025, noninterest expense was reduced by $0.3 million from non-recurring adjustments resulting from the Civista Leasing and Finance Division core system conversion. 

• Compensation expense decreased $0.7 million for the second quarter of 2025 compared to the same period last year, primarily due to fewer employees and an increase in the deferral of salaries and wages related to the loan originations in the second quarter of 2025.
• The quarter-to-date average number of full-time equivalent ("FTE") employees was 526 at June 30, 2025, compared with an average number of 537 for the same period in 2024.
• Professional fees increased $0.5 million for the second quarter of 2025 compared to the same period last year, mainly due to utilizing consultants to assist in transitioning Civista Leasing and Finance Division to a new core processing system.
• Equipment expense decreased $0.7 million for the second quarter of 2025 compared to the same period last year, due to normal equipment depreciation as well as decreases in equipment expense related to operating lease contracts.
• The efficiency ratio was 64.5% for the quarter ended June 30, 2025, compared to 72.6% for the same period last year. The change in the efficiency ratio is primarily due to a 3.2% decrease in noninterest expenses, a 25.5% increase in net interest income, partially offset by a 36.5% decrease in noninterest income.

Noninterest expense totaled $54.6 million, a decrease of $1.2 million or 2.2%, when compared to the same period last year.  For the six months ended June 30, 2025, noninterest expense was reduced by $0.3 million from non-recurring adjustments resulting from the Civista Leasing and Finance Division core system conversion. 

• Compensation expense decreased $2.1 million for the six months ended June 30, 2025 compared to the same period last year, primarily due to fewer employees, and an increase in the deferral of salaries and wages related to the loan originations as well as lower employee benefits costs in the first six months of 2025.
• The year-to-date average number of FTE employees was 523 at June 30, 2025, compared with an average number of 538 for the same period in 2024.
• Professional fees increased $1.5 million for the six months ended June 30, 2025, compared to the same period last year, mainly due to utilizing consultants to assist in transitioning Civista Leasing and Finance Division to a new core processing system.
• Equipment expense decreased $1.1 million for the six months ended June 30, 2025, compared to the same period last year, due to normal equipment depreciation as well as decreases in equipment expense related to operating lease contracts.
• The efficiency ratio was 64.7% for the six months ended June 30, 2025, compared to 72.4% for the same period last year. The change in the efficiency ratio is primarily due to a 2.2% decrease in noninterest expenses, a 20.4% increase in net interest income, partially offset by a 22.5% decrease in noninterest income.

Taxes

Civista's effective income tax rate for the second quarter of 2025 was 14.6% compared to 12.6% for the same period last year, and 14.8% for the first quarter of 2025.  

Civista's effective income tax rate for the six months ended June 30, 2025, was 14.7% compared to 12.1% in the same period last year.  

Capital

Total shareholders' equity at June 30, 2025, totaled $404.1 million, an increase of $6.7 million from March 31, 2025, and $15.6 million from December 31, 2024. This resulted from an increase of $15.9 million in retained earnings, partially offset by a reduction in accumulated other comprehensive loss of $0.7 million from December 31,2024.    

Civista did not repurchase any shares in the second quarter of 2025 as the current repurchase plan is set to expire in April 2026.  In January 2025, Civista liquidated 8,182 shares held by employees, at $20.39 per share, to satisfy tax obligations stemming from vesting of restricted shares.

Recent Developments

July 10, 2025, Civista Bancshares, Inc. announced the signing of a definitive merger agreement pursuant to which Civista will acquire The Farmers Savings Bank.

July 10, 2025, Civista Bancshares, Inc. announced an underwritten public offering of its common stock, including an overallotment option. The offering totaled 3,788,238 shares at a price of $21.25 per share, raising approximately $80,500,058.

Conference Call and Webcast
Civista Bancshares, Inc. will also host a conference call to discuss the Company's financial results for the second quarter of 2025 at 1:00 p.m. ET on Thursday, July 24, 2025.  Interested parties can access the live webcast of the conference call through the Investor Relations section of the Company's website, www.civb.com. Participants can also listen to the conference call by dialing 800-836-8184 and ask to be joined into the Civista Bancshares, Inc. second quarter 2025 earnings call.  Please log in or dial in at least 10 minutes prior to the start time to ensure a connection.  An archive of the webcast will be available for one year on the Investor Relations section of the Company's website (www.civb.com).

About Civista Bancshares
Civista Bancshares, Inc., is a $4.2 billion financial holding company headquartered in Sandusky, Ohio.  Its primary subsidiary, Civista Bank, was founded in 1884 and provides full-service banking, commercial lending, mortgage, and wealth management services.  Today, Civista Bank operates 42 locations across Ohio, Southeastern Indiana and Northern Kentucky.  Civista Bank also offers commercial equipment leasing services for businesses nationwide through its Civista Leasing and Finance Division.  Civista Bancshares' common shares are traded on the NASDAQ Capital Market under the symbol "CIVB".  Learn more at www.civb.com.

Forward Looking Statements
This press release may contain forward-looking statements regarding the financial performance, business prospects, growth and operating strategies of Civista.  For these statements, Civista claims the protections of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995.   Statements in this press release should be considered in conjunction with the other information available about Civista, including the information in the filings we make with the Securities and Exchange Commission. Forward-looking statements provide current expectations or forecasts of future events and are not guarantees of future performance.  The forward-looking statements are based on management's expectations and are subject to a number of risks and uncertainties.  We have tried, wherever possible, to identify such statements by using words such as "anticipate," "estimate," "project," "intend," "plan," "believe," "will" and similar expressions in connection with any discussion of future operating or financial performance. Although management believes that the expectations reflected in such forward-looking statements are reasonable, actual results may differ materially from those expressed or implied in such statements.  Risks and uncertainties that could cause actual results to differ materially include risk factors relating to the banking industry and the other factors detailed from time to time in Civista' reports filed with the Securities and Exchange Commission, including those described in "Item 1A Risk Factors" of Part I of Civista's Annual Report on Form 10-K for the fiscal year ended December 31, 2024, and any additional risks identified in the Company's subsequent Form 10-Q's.  Undue reliance should not be placed on the forward-looking statements, which speak only as of the date hereof.  Civista does not undertake, and specifically disclaims any obligation, to update any forward-looking statement to reflect the events or circumstances after the date on which the forward-looking statement is made, or reflect the occurrence of unanticipated events, except to the extent required by law.

Non-GAAP Financial Measures
This press release and related materials may contain references to measures which are not defined in generally accepted accounting principles ("GAAP"). These financial measures have been included as they provide meaningful supplemental information to assess trends in the Corporation's results of operations. Information concerning these non-GAAP financial measures can be found in the financial tables. Management believes these measures are meaningful because they reflect adjustments commonly made by management, investors, regulators, and analysts to evaluate the adequacy of earnings per common share, provide a greater understanding of ongoing operations and enhance comparability of results with prior periods.