SmartFinancial Announces Results for the Fourth Quarter 2025

SmartFinancial Announces Results for the Fourth Quarter 2025

KNOXVILLE, Tenn.–(BUSINESS WIRE)–
SmartFinancial, Inc. (“SmartFinancial” or the “Company”; NYSE: SMBK), today announced net income of $13.7 million, or $0.81 per diluted common share, for the fourth quarter of 2025, compared to net income of $9.6 million, or $0.57 per diluted common share, for the fourth quarter of 2024, and compared to prior quarter net income of $13.7 million, or $0.81 per diluted common share. Operating earnings¹, which excludes non-recurring income and expenses, net of tax adjustments, totaled $13.7 million, or $0.81 per diluted common share, in the fourth quarter of 2025, compared to $9.6 million, or $0.57 per diluted common share, in the fourth quarter of 2024, and compared to $14.5 million, or $0.86 per diluted common share, in the third quarter of 2025.

Highlights for the Fourth Quarter of 2025

Operating earnings¹ of $13.7 million, or $0.81 per diluted common share
Net organic loan and lease growth of $141 million with 13% annualized quarter-over-quarter increase
Deposit growth of $102 million or 8% annualized quarter-over-quarter
Net interest margin, fully tax equivalent basis (“FTE”) expanded to 3.38%, reflecting lower deposit and funding costs
Quarter over quarter tangible book value per common share¹ growth of 13%
Seventh consecutive quarter of positive operating leverage
Columbus, GA expansion with two additional commercial bankers
Multi-year core contract renegotiation process completed

Billy Carroll, President & CEO, stated: “2025 marked a year of tremendous momentum build and overall improvement for our company. We generated approximately 11% positive operating leverage in 2025 capped off by our seventh consecutive quarter of positive operating leverage in Q4. The year was highlighted by approximately 12% organic loan growth, 14% organic deposit growth excluding brokered deposits and tangible book value per common share¹ rose 17%. Overall, a fantastic year for our company paving the way for an even brighter 2026. I want to thank all of our Associates whose tireless work and dedication make SmartBank a great place to work and do business. They are the driving force behind our success.”

SmartFinancial’s Chairman, Miller Welborn, concluded: “2025 was an exceptional year marked by growth, profitability, and continued improvement. The Board is extremely pleased with the Company’s ongoing financial progress, which is particularly impressive considering the range of strategic initiatives completed during the year. Operational excellence and a solid foundation remain essential for sustained success, and our Associates consistently demonstrate commitment in every area. We appreciate your contributions in making SmartBank an outstanding organization and valued partner for our stakeholders.”

Net Interest Income and Net Interest Margin

Net interest income was $45.1 million for the fourth quarter of 2025, compared to $42.4 million for the prior quarter. Average earning assets totaled $5.34 billion, an increase of $112.3 million from the prior quarter. The balances of average earnings assets increased quarter-over-quarter, primarily from an increase in average loans and leases of $124.0 million and average securities of $32.7 million, offset by a decrease in average interest-earning cash of $44.3 million. Average interest-bearing liabilities increased by $18.6 million from the prior quarter, primarily attributable to an increase in average interest-bearing deposits of $6.0 million and average subordinated debt of $13.9 million, offset by a decrease in borrowings of $1.3 million.

The tax equivalent net interest margin was 3.38% for the fourth quarter of 2025, up from 3.25% for the prior quarter. This increase is primarily related to declines in deposit costs, outpacing a modest decrease in asset yields. The yield on loans and leases, excluding loan fees, FTE was 6.00% for the fourth quarter of 2025, compared to 6.05% for the prior quarter.

¹ Non-GAAP measure. See “Non-GAAP Financial Measures” for more information and see the Non-GAAP Reconciliations.

The cost of total deposits for the fourth quarter of 2025 was 2.26%, compared to 2.44% in the prior quarter. The cost of interest-bearing liabilities was 2.90% for the fourth quarter of 2025, compared to 3.07% in the prior quarter. The cost of average interest-bearing deposits was 2.79% for the fourth quarter of 2025, compared to 2.98% for the prior quarter, a decrease of 19 basis points.

The following table presents selected interest rates and yields for the periods indicated:


	Three Months Ended
	Dec		Sep		Increase
Selected Interest Rates and Yields	2025		2025		(Decrease)
Yield on loans and leases, excluding loan fees, FTE	6.00	%	6.05	%	(0.05	)	%
Yield on loans and leases, FTE	6.08	%	6.14	%	(0.06	)	%
Yield on earning assets, FTE	5.65	%	5.68	%	(0.03	)	%
Cost of interest-bearing deposits	2.79	%	2.98	%	(0.19	)	%
Cost of total deposits	2.26	%	2.44	%	(0.18	)	%
Cost of interest-bearing liabilities	2.90	%	3.07	%	(0.17	)	%
Net interest margin, FTE	3.38	%	3.25	%	0.13		%

Provision for Credit Losses on Loans and Leases and Credit Quality

At December 31, 2025, the allowance for credit losses was $40.9 million. The allowance for credit losses to total loans and leases was 0.94% as of December 31, 2025, and 0.93% as of September 30, 2025.

The following table presents detailed information related to the provision for credit losses for the periods indicated (dollars in thousands):


	Three Months Ended
		Dec				Sep				Increase
Provision for Credit Losses on Loans and Leases Rollforward		2025				2025				(Decrease)
Beginning balance	$	39,074			$	39,776			$	(702	)
Charge-offs		(1,993	)			(1,145	)			(848	)
Recoveries		101				92				9
Net charge-offs		(1,892	)			(1,053	)			(839	)
Provision for credit losses ⁽¹⁾		3,724				351				3,373
Ending balance	$	40,906			$	39,074			$	1,832

Allowance for credit losses to total loans and leases, gross		0.94		%		0.93		%		0.01		%

⁽¹⁾

The current quarter-ended and prior quarter-ended excludes an unfunded commitments provision of $408 thousand and a release of $124 thousand, respectively. At December 31, 2025, and September 30, 2025, the unfunded commitment liability totaled $3.6 million and $3.2 million, respectively.

Nonperforming loans and leases as a percentage of total loans and leases was 0.22% as of December 31, 2025, and 0.24% as of September 30, 2025. Total nonperforming assets (which include nonaccrual loans and leases, loans and leases past due 90 days or more and still accruing, other real estate owned and other repossessed assets) as a percentage of total assets was 0.22% as of December 31, 2025, and September 30, 2025.

The following table presents detailed information related to credit quality for the periods indicated (dollars in thousands):


	Three Months Ended
		Dec			Sep			Increase
Credit Quality		2025			2025			(Decrease)
Nonaccrual loans and leases	$	9,442		$	9,970		$	(528	)
Loans and leases past due 90 days or more and still accruing		–			129			(129	)
Total nonperforming loans and leases		9,442			10,099			(657	)
Other real estate owned		–			–			–
Other repossessed assets		3,248			2,444			804
Total nonperforming assets	$	12,690		$	12,543		$	147

Nonperforming loans and leases to total loans and leases, gross		0.22	%		0.24	%		(0.02	)	%
Nonperforming assets to total assets		0.22	%		0.22	%		–		%

Noninterest Income

Noninterest income decreased $418 thousand to $8.2 million for the fourth quarter of 2025, compared to $8.6 million for the prior quarter. The fourth quarter decrease was attributable to the reduction of insurance commissions and the gain on sale of SBK Insurance (“SBKI”) in the prior quarter. Additionally, in the prior quarter, there was a pre-tax loss of $3.9 million on the sale of $85 million of available-for-sale securities. These changes were offset by higher capital markets’ income included in other noninterest income.

The following table presents detailed information related to noninterest income for the periods indicated (dollars in thousands):


	Three Months Ended
		Dec		Sep			Increase
Noninterest Income		2025		2025			(Decrease)
Service charges on deposit accounts	$	1,828	$	1,831		$	(3	)
Loss on sale of securities, net		–		(3,715	)		3,715
Mortgage banking income		837		709			128
Investment services		1,683		1,690			(7	)
Insurance commissions		–		1,049			(1,049	)
Interchange and debit card transaction fees		1,375		1,338			37
Gain on sale of SBKI		–		3,955			(3,955	)
Other		2,496		1,780			716
Total noninterest income	$	8,219	$	8,637		$	(418	)

Noninterest Expense

Noninterest expense decreased $1.4 million to $32.5 million for the fourth quarter of 2025, compared to $33.9 million for the prior quarter. The fourth quarter’s decrease was primarily attributable to a decrease in restructuring expenses associated with the sale of SBKI.

The following table presents detailed information related to noninterest expense for the periods indicated (dollars in thousands):


	Three Months Ended
		Dec		Sep		Increase
Noninterest Expense		2025		2025		(Decrease)
Salaries and employee benefits	$	19,917	$	19,544	$	373
Occupancy and equipment		3,388		3,468		(80	)
FDIC insurance		1,025		1,025		–
Other real estate and loan related expenses		858		969		(111	)
Advertising and marketing		393		454		(61	)
Data processing and technology		2,413		2,594		(181	)
Professional services		1,132		1,123		9
Amortization of intangibles		479		536		(57	)
Restructuring expenses		16		1,310		(1,294	)
Other		2,850		2,846		4
Total noninterest expense	$	32,471	$	33,869	$	(1,398	)

Income Tax Expense

Income tax expense was $3.0 million for the fourth quarter of 2025, a decrease of $278 thousand, compared to $3.3 million for the prior quarter.

Balance Sheet Trends

Total assets at December 31, 2025, were $5.86 billion compared to $5.28 billion at December 31, 2024. The $584.9 million increase is primarily attributable to increases in loans and leases of $457.2 million, cash and cash equivalents of $76.8 million, securities of $53.0 million, loans held for sale of $4.9 million, bank owned life insurance of $3.6 million and other investments of $1.7 million, offset by a decrease in goodwill and other intangibles of $9.4 million, primarily associated with the sale of SBKI, and a decrease in premises and equipment of $2.7 million.

Total liabilities were $5.31 billion at December 31, 2025, compared to $4.78 billion at December 31, 2024, an increase of $523.9 million. Total deposits increased $466.3 million, which was driven primarily by increases in money market deposits of $234.1 million, other time deposits of $185.9 million, interest-bearing demand deposits of $109.0 million and noninterest demand deposits of $97.4 million, offset by a decline in brokered deposits of $160.0 million. In addition, subordinated debt increased $59.0 million as a result of issuing $100.0 million in new subordinated debt and retiring the existing $40.0 million of subordinated debt.

Shareholders’ equity at December 31, 2025, totaled $552.5 million, an increase of $61.0 million, from December 31, 2024. The increase in shareholders’ equity was primarily driven by net income of $50.3 million for the twelve months ending December 31, 2025, and a reduction of $14.4 million in accumulated other comprehensive loss, offset by dividends paid of $5.4 million. Tangible book value per common share² was $26.85 at December 31, 2025, compared to $22.85 at December 31, 2024. Tangible common equity¹ as a percentage of tangible assets¹ was 7.93% at December 31, 2025, compared with 7.48% at December 31, 2024.

The following table presents selected balance sheet information for the periods indicated (dollars in thousands):


	Dec		Dec		Increase
Selected Balance Sheet Information	2025		2024		(Decrease)
Total assets	$	5,860,810	$	5,275,904	$	584,906
Total liabilities		5,308,318		4,784,443		523,875
Total equity		552,492		491,461		61,031
Securities		662,003		608,987		53,016
Loans and leases		4,363,582		3,906,340		457,242
Deposits		5,152,789		4,686,483		466,306
Borrowings		3,009		8,135		(5,126	)

Conference Call Information

SmartFinancial issued this earnings release for the fourth quarter of 2025 on Tuesday, January 20, 2026, and will host a conference call on Wednesday, January 21, 2026, at 10:00 a.m. ET. To access this interactive teleconference, dial (833) 470-1428 or (646) 844-6383 and enter the access code, 680807. A replay of the conference call will be available through March 21, 2026, by dialing (866) 813-9403 or (929) 458-6194 and enter the access code, 497919. Conference call materials will be published on the Company’s webpage located at http://www.smartfinancialinc.com/CorporateProfile, at 9:00 a.m. ET prior to the conference call.

Non-GAAP measure. See “Non-GAAP Financial Measures” for more information and see the Non-GAAP Reconciliations.

About SmartFinancial, Inc.

SmartFinancial, Inc., based in Knoxville, Tennessee, is the bank holding company for SmartBank. SmartBank is a full-service commercial bank founded in 2007, with branches across Tennessee, Alabama, and Florida. Recruiting the best people, delivering exceptional client service, strategic branching, and a disciplined approach to lending have contributed to SmartBank’s success. More information about SmartFinancial can be found on its website: www.smartfinancialinc.com.

Non-GAAP Financial Measures

Statements included in this earnings release include measures not recognized under U.S. generally accepted accounting principles (“GAAP”) and therefore are considered Non-GAAP financial measures (“Non-GAAP”) and should be read along with the accompanying tables, which provide a reconciliation of Non-GAAP financial measures to GAAP financial measures. SmartFinancial management uses several Non-GAAP financial measures and ratios derived therefrom in its analysis of the Company’s performance, including:

Operating earnings
Operating noninterest income
Operating noninterest expense
Operating pre-provision net revenue (“PPNR”) earnings
Tangible common equity
Average tangible common equity
Tangible book value per common share
Tangible assets
Operating efficiency ratio

Operating earnings, operating PPNR earnings, operating noninterest income and operating noninterest expense exclude non-operating related income and expense items from net income, noninterest income and noninterest expense, respectively. Tangible common equity and average tangible common equity exclude goodwill and other intangible assets from shareholders’ equity and average shareholders’ equity, respectively. Tangible book value per common share is tangible common equity divided by common shares outstanding. Tangible assets excludes goodwill and other intangibles from total assets. Operating efficiency ratio is the quotient of operating noninterest expense divided by the sum of net interest income adjusted for taxable equivalent yields plus operating noninterest income. A detailed reconciliation of these items and the ratios derived therefrom is available in the Non-GAAP reconciliations.

Management believes that Non-GAAP financial measures provide additional useful information that allows investors to evaluate the ongoing performance of the Company and provide meaningful comparisons to its peers. Management also believes these Non-GAAP financial measures enhance investors’ ability to compare period-to-period financial results and allow investors and Company management to view our operating results excluding the impact of items that are not reflective of the underlying operating performance.

Non-GAAP financial measures should not be considered as an alternative to any measure of performance or financial condition as promulgated under GAAP, and investors should consider SmartFinancial’s performance and financial condition as reported under GAAP and all other relevant information when assessing the performance or financial condition of the Company. Non-GAAP financial measures have limitations as analytical tools, and investors should not consider them in isolation or as a substitute for analysis of the results or financial condition as reported under GAAP.

Forward-Looking Statements

This news release may contain statements that are based on management’s current estimates or expectations of future events or future results, and that may be deemed to constitute forward-looking statements as defined under the Private Securities Litigation Reform Act of 1995. These statements are not historical in nature and can generally be identified by such words as “expect,” “anticipate,” “intend,” “plan,” “believe,” “seek,” “may,” “estimate,” and similar expressions. All forward-looking statements are subject to risks, uncertainties, and other factors that may cause the actual results of SmartFinancial to differ materially from future results expressed or implied by such forward-looking statements. Such risks, uncertainties, and other factors include, among others,

(1)		risks associated with our growth strategy, including a failure to implement our growth plans or an inability to manage our growth effectively;
(2)		claims and litigation arising from our business activities and from the companies we acquire, which may relate to contractual issues, environmental laws, fiduciary responsibility, and other matters;
(3)		general risks related to our disposition, merger and acquisition activity, including risks associated with our pursuit of future acquisitions or sales;
(4)		changes in management’s plans for the future;
(5)		prevailing, or changes in, economic or political conditions (including those resulting from the current administration and Congress), particularly in our market areas, including the effects of declines in the real estate market, high unemployment rates, inflationary pressures, elevated interest rates and slowdowns in economic growth, as well as the financial stress on borrowers as a result of the foregoing;
(6)		our ability to anticipate interest rate changes and manage interest rate risk (including the impact of higher interest rates on macroeconomic conditions, competition, and the cost of doing business and the impact of interest rate fluctuations on our financial projections, models and guidance);
(7)		tariffs or trade wars (including reduced consumer spending, lower economic growth or recession, reduced demand for U.S. exports, disruptions to supply chains, and decreased demand for other banking products and services);
(8)		uncertain duration of trade conflicts and the magnitude of the impact that proposed tariffs may have on our customers’ businesses;
(9)		increased technology and cybersecurity risks, including generative artificial intelligence risks;
(10)		the impact of a failure in, or breach of, our operational or security systems or infrastructure, or those of third parties with whom we do business, including as a result of cyber-attacks or an increase in the incidence or severity of fraud, illegal payments, security breaches or other illegal acts impacting us and our customers;
(11)		credit risk associated with our lending activities;
(12)		changes in loan demand, real estate values, or competition;
(13)		developments in our mortgage banking business, including loan modifications, general demand, and the effects of judicial or regulatory requirements or guidance;
(14)		changes in accounting principles, policies, or guidelines;
(15)		changes in applicable laws, rules, or regulations;
(16)		adverse results from current or future litigation, regulatory examinations or other legal and/or regulatory actions;
(17)		potential impacts of any adverse developments in the banking industry, including the impacts on customer confidence, deposit outflows, liquidity and the regulatory response thereto;
(18)		significant turbulence or a disruption in the capital or financial markets and the effect of a fall in stock market prices on our investment securities;
(19)		the effects of war or other conflicts;
(20)		the impact of government actions or inactions, including a prolonged shutdown of the federal government; and
(21)		other general competitive, economic, political, and market factors, including those affecting our business, operations, pricing, products, or services.

These and other factors that could cause results to differ materially from those described in the forward-looking statements can be found in SmartFinancial’s most recent annual report on Form 10-K, quarterly reports on Form 10-Q, and current reports on Form 8-K, in each case filed with or furnished to the Securities and Exchange Commission (the “SEC”) and available on the SEC’s website (www.sec.gov). Undue reliance should not be placed on forward-looking statements. SmartFinancial disclaims any obligation to update or revise any forward-looking statements contained in this release, which speak only as of the date hereof, whether as a result of new information, future events, or otherwise.

SmartFinancial, Inc. and Subsidiary
Condensed Consolidated Financial Information – (unaudited)
(dollars in thousands)

	Ending Balances
	Dec			Sep			Jun			Mar			Dec
	2025			2025			2025			2025			2024
Assets:
Cash and cash equivalents	$	464,417		$	557,127		$	365,096		$	422,984		$	387,570
Securities available-for-sale, at fair value		539,882			511,095			502,150			499,445			482,328
Securities held-to-maturity, at amortized cost		122,121			123,364			124,520			125,576			126,659
Other investments		16,441			14,888			14,713			14,371			14,740
Loans held for sale		10,865			9,855			5,484			3,843			5,996
Loans and leases		4,363,582			4,222,369			4,124,062			3,992,207			3,906,340
Less: Allowance for credit losses		(40,906	)		(39,074	)		(39,776	)		(38,175	)		(37,423	)
Loans and leases, net		4,322,676			4,183,295			4,084,286			3,954,032			3,868,917
Premises and equipment, net		88,387			89,250			90,204			90,708			91,093
Other real estate owned		—			—			144			144			179
Goodwill and other intangibles, net		95,328			95,807			103,588			104,154			104,723
Bank owned life insurance		119,525			118,610			117,697			116,805			115,917
Other assets		81,168			81,692			82,981			79,155			77,782
Total assets	$	5,860,810		$	5,784,983		$	5,490,863		$	5,411,217		$	5,275,904
Liabilities:
Deposits:
Noninterest-bearing demand	$	1,062,918		$	931,477		$	906,965		$	884,294		$	965,552
Interest-bearing demand		945,716			929,454			843,820			885,063			836,731
Money market and savings		2,273,612			2,218,313			2,124,623			2,131,828			2,039,560
Time deposits		870,543			971,653			996,712			907,474			844,640
Total deposits		5,152,789			5,050,897			4,872,120			4,808,659			4,686,483
Borrowings		3,009			1,301			6,966			7,610			8,135
Subordinated debt		98,662			138,604			39,726			39,705			39,684
Other liabilities		53,858			55,699			52,924			49,302			50,141
Total liabilities		5,308,318			5,246,501			4,971,736			4,905,276			4,784,443
Shareholders’ Equity:
Common stock		17,029			17,028			17,018			17,018			16,926
Additional paid-in capital		295,950			295,742			295,209			294,736			294,269
Retained earnings		248,719			236,380			224,061			213,721			203,824
Accumulated other comprehensive loss		(9,319	)		(10,781	)		(17,274	)		(19,647	)		(23,671	)
Total shareholders’ equity attributable to SmartFinancial Inc. and Subsidiary		552,379			538,369			519,014			505,828			491,348
Non-controlling interest – preferred stock of subsidiary		113			113			113			113			113
Total shareholders’ equity		552,492			538,482			519,127			505,941			491,461
Total liabilities & shareholders’ equity	$	5,860,810		$	5,784,983		$	5,490,863		$	5,411,217		$	5,275,904

SmartFinancial, Inc. and Subsidiary
Condensed Consolidated Financial Information – (unaudited)
(dollars in thousands except share and per share data)

	Three Months Ended												Year Ended
	Dec		Sep			June			Mar		Dec		Dec			Dec
	2025		2025			2025			2025		2024		2025			2024
Interest income:
Loans and leases, including fees	$	65,573	$	64,282		$	61,049		$	57,762	$	57,951	$	248,666		$	213,562
Investment securities:
Taxable		5,662		4,876			4,848			4,775		5,050		20,161			20,151
Tax-exempt		536		441			395			354		351		1,726			1,406
Federal funds sold and other earning assets		3,854		4,919			3,161			3,485		2,744		15,419			16,000
Total interest income		75,625		74,518			69,453			66,376		66,096		285,972			251,119
Interest expense:
Deposits		28,646		30,464			28,301			27,335		27,437		114,747			109,260
Borrowings		1		14			70			70		89		155			1,075
Subordinated debt		1,884		1,610			739			733		787		4,966			3,434
Total interest expense		30,531		32,088			29,110			28,138		28,313		119,868			113,769
Net interest income		45,094		42,430			40,343			38,238		37,783		166,104			137,350
Provision for credit losses		4,132		227			2,411			979		2,135		7,750			5,153
Net interest income after provision for credit losses		40,962		42,203			37,932			37,259		35,648		158,354			132,197
Noninterest income:
Service charges on deposit accounts		1,828		1,831			1,766			1,736		1,778		7,161			6,862
(Loss) gain on sale of securities, net		—		(3,715	)		(4	)		—		64		(3,719	)		64
Mortgage banking		837		709			633			493		541		2,673			1,579
Investment services		1,683		1,690			1,440			1,769		1,382		6,582			5,945
Insurance commissions		—		1,049			1,554			1,412		1,832		4,016			5,696
Interchange and debit card transaction fees		1,375		1,338			1,342			1,220		1,332		5,275			5,277
Gain on sale of SBKI		—		3,955			—			—		—		3,955			—
Other		2,496		1,780			2,167			1,967		2,101		8,409			8,729
Total noninterest income		8,219		8,637			8,898			8,597		9,030		34,352			34,152
Noninterest expense:
Salaries and employee benefits		19,917		19,544			19,602			19,234		19,752		78,297			72,100
Occupancy and equipment		3,388		3,468			3,432			3,397		3,473		13,686			13,617
FDIC insurance		1,025		1,025			992			960		825		4,002			3,390
Other real estate and loan related expense		858		969			757			658		1,241		3,242			2,823
Advertising and marketing		393		454			390			382		397		1,619			1,321
Data processing and technology		2,413		2,594			2,651			2,657		2,495		10,316			9,930
Professional services		1,132		1,123			1,153			1,368		1,017		4,775			4,207
Amortization of intangibles		479		536			566			569		601		2,150			2,425
Restructuring expenses		16		1,310			—			—		—		1,326			—
Other		2,850		2,846			3,026			3,071		2,490		11,792			11,077
Total noninterest expense		32,471		33,869			32,569			32,296		32,291		131,205			120,890
Income before income taxes		16,710		16,971			14,261			13,560		12,387		61,501			45,459
Income tax expense		3,007		3,285			2,556			2,306		2,747		11,154			9,318
Net income	$	13,703	$	13,686		$	11,705		$	11,254	$	9,640	$	50,347		$	36,141
Earnings per common share:
Basic	$	0.82	$	0.82		$	0.70		$	0.67	$	0.58	$	3.00		$	2.16
Diluted	$	0.81	$	0.81		$	0.69		$	0.67	$	0.57	$	2.98		$	2.14
Weighted average common shares outstanding:
Basic		16,788,065		16,781,236			16,778,988			16,767,535		16,729,509		16,779,019			16,768,956
Diluted		16,922,482		16,908,920			16,878,736			16,872,097		16,863,780		16,896,519			16,878,456

SmartFinancial, Inc. and Subsidiary
Condensed Consolidated Financial Information – (unaudited)
(dollars in thousands)
YIELD ANALYSIS

	Three Months Ended
	December 31, 2025						September 30, 2025						December 31, 2024
	Average				Yield/		Average				Yield/		Average				Yield/
	Balance		Interest		Cost		Balance		Interest		Cost		Balance		Interest		Cost
Assets:
Loans and leases, including fees¹	$	4,295,446	$	65,807	6.08	%	$	4,171,444	$	64,526	6.14	%	$	3,830,301	$	58,188	6.04	%
Taxable securities		580,256		5,662	3.87	%		556,894		4,876	3.47	%		554,152		5,050	3.63	%
Tax-exempt securities²		79,149		678	3.40	%		69,843		558	3.17	%		63,309		444	2.79	%
Federal funds sold and other earning assets		383,882		3,854	3.98	%		428,209		4,919	4.56	%		233,793		2,745	4.67	%
Total interest-earning assets		5,338,733		76,001	5.65	%		5,226,390		74,879	5.68	%		4,681,555		66,427	5.64	%
Noninterest-earning assets		400,618						408,560						407,695
Total assets	$	5,739,351					$	5,634,950					$	5,089,250

Liabilities and Shareholders’ Equity:
Interest-bearing demand deposits	$	902,505		3,817	1.68	%	$	869,690		4,048	1.85	%	$	826,750		3,775	1.82	%
Money market and savings deposits		2,254,175		16,017	2.82	%		2,186,245		16,693	3.03	%		1,923,265		14,830	3.07	%
Time deposits		911,044		8,812	3.84	%		1,005,800		9,723	3.84	%		861,211		8,832	4.08	%
Total interest-bearing deposits		4,067,724		28,646	2.79	%		4,061,735		30,464	2.98	%		3,611,226		27,437	3.02	%
Borrowings		3,024		1	0.13	%		4,351		14	1.28	%		9,145		89	3.87	%
Subordinated debt		99,062		1,884	7.55	%		85,113		1,610	7.50	%		39,672		787	7.89	%
Total interest-bearing liabilities		4,169,810		30,531	2.90	%		4,151,199		32,088	3.07	%		3,660,043		28,313	3.08	%
Noninterest-bearing deposits		964,612						900,079						889,151
Other liabilities		58,440						57,843						50,884
Total liabilities		5,192,862						5,109,121						4,600,078
Shareholders’ equity		546,489						525,829						489,172
Total liabilities and shareholders’ equity	$	5,739,351					$	5,634,950					$	5,089,250

Net interest income, taxable equivalent			$	45,470					$	42,791					$	38,114
Interest rate spread					2.74	%					2.62	%					2.57	%
Tax equivalent net interest margin					3.38	%					3.25	%					3.24	%

Percentage of average interest-earning assets to average interest-bearing liabilities					128.03	%					125.90	%					127.91	%
Percentage of average equity to average assets					9.52	%					9.33	%					9.61	%

¹Yields computed on tax-exempt loans on a tax equivalent basis include $235 thousand, $244 thousand, and $237 thousand of taxable equivalent income for the quarters ended December 31, 2025, September 30, 2025, and December 31, 2024, respectively.

²Yields computed on tax-exempt instruments on a tax equivalent basis include $142 thousand, $117 thousand, and $93 thousand of taxable equivalent income for the quarters ended December 31, 2025, September 30, 2025, and December 31, 2024, respectively.

SmartFinancial, Inc. and Subsidiary
Condensed Consolidated Financial Information – (unaudited)
(dollars in thousands)
YIELD ANALYSIS

	Year Ended
	December 31, 2025							December 31, 2024
	Average				Yield/			Average				Yield/
	Balance		Interest		Cost			Balance		Interest		Cost
Assets:
Loans and leases, including fees¹	$	4,115,793	$	249,636		6.07	%	$	3,607,558	$	214,310	5.94	%
Taxable securities		563,978		20,161		3.57	%		580,001		20,151	3.47	%
Tax-exempt securities²		69,620		2,185		3.14	%		63,679		1,780	2.80	%
Federal funds sold and other earning assets		349,105		15,419		4.42	%		300,081		16,000	5.33	%
Total interest-earning assets		5,098,496		287,401		5.64	%		4,551,319		252,241	5.54	%
Noninterest-earning assets		405,205							388,267
Total assets	$	5,503,701						$	4,939,586

Liabilities and Shareholders’ Equity:
Interest-bearing demand deposits	$	863,772		15,394		1.78	%	$	932,598		21,074	2.26	%
Money market and savings deposits		2,152,812		63,535		2.95	%		1,913,673		64,116	3.35	%
Time deposits		928,404		35,818		3.86	%		623,652		24,070	3.86	%
Total interest-bearing deposits		3,944,988		114,747		2.91	%		3,469,923		109,260	3.15	%
Borrowings		5,826		155		2.66	%		21,719		1,075	4.95	%
Subordinated debt		66,110		4,966		7.51	%		41,184		3,434	8.34	%
Total interest-bearing liabilities		4,016,924		119,868		2.98	%		3,532,826		113,769	3.22	%
Noninterest-bearing deposits		911,988							883,923
Other liabilities		54,300							48,949
Total liabilities		4,983,212							4,465,698
Shareholders’ equity		520,489							473,888
Total liabilities and shareholders’ equity	$	5,503,701						$	4,939,586

Net interest income, taxable equivalent			$	167,533						$	138,472
Interest rate spread						2.65	%					2.32	%
Tax equivalent net interest margin						3.29	%					3.04	%

Percentage of average interest-earning assets to average interest-bearing liabilities						126.93	%					128.83	%
Percentage of average equity to average assets						9.46	%					9.59	%

¹Yields computed on tax-exempt loans on a tax equivalent basis include $970 thousand and $748 thousand of taxable equivalent income for the year ended December 31, 2025, and 2024, respectively.

²Yields computed on tax-exempt instruments on a tax equivalent basis include $459 thousand and $374 thousand of taxable equivalent income for the year ended December 31, 2025, and 2024, respectively.

SmartFinancial, Inc. and Subsidiary
Condensed Consolidated Financial Information – (unaudited)
(dollars in thousands)

	As of and for The Three Months Ended
	Dec			Sep			Jun			Mar			Dec
	2025			2025			2025			2025			2024
Composition of Loans and Leases:
Commercial real estate:
Non-owner occupied	$	1,196,758		$	1,136,080		$	1,114,133		$	1,117,392		$	1,080,404
Owner occupied		1,022,871			1,012,088			958,989			885,396			867,678
Commercial real estate, total		2,219,629			2,148,168			2,073,122			2,002,788			1,948,082
Consumer real estate		834,626			811,150			803,270			784,602			741,836
Construction & land development		419,176			390,691			391,155			357,393			361,735
Commercial & industrial		817,595			794,751			778,754			768,454			775,620
Leases		55,422			60,301			62,495			64,208			64,878
Consumer and other		17,134			17,308			15,266			14,762			14,189
Total loans and leases	$	4,363,582		$	4,222,369		$	4,124,062		$	3,992,207		$	3,906,340

Asset Quality and Additional Loan Data:
Nonperforming loans and leases	$	9,442		$	10,099		$	7,921		$	7,807		$	7,872
Other real estate owned		—			—			144			144			179
Other repossessed assets		3,248			2,444			2,397			2,414			2,037
Total nonperforming assets	$	12,690		$	12,543		$	10,462		$	10,365		$	10,088
Modified loans and leases¹ not included in nonperforming loans and leases	$	219		$	1,783		$	1,660		$	1,978		$	3,989
Net charge-offs to average loans and leases (annualized)		0.18	%		0.10	%		0.01	%		0.01	%		0.02	%
Allowance for credit losses to loans and leases		0.94	%		0.93	%		0.96	%		0.96	%		0.96	%
Nonperforming loans and leases to total loans and leases, gross		0.22	%		0.24	%		0.19	%		0.20	%		0.20	%
Nonperforming assets to total assets		0.22	%		0.22	%		0.19	%		0.19	%		0.19	%

Capital Ratios:
Equity to Assets		9.43	%		9.31	%		9.45	%		9.35	%		9.32	%
Tangible common equity to tangible assets (Non-GAAP)²		7.93	%		7.78	%		7.71	%		7.57	%		7.48	%

SmartFinancial, Inc.³
Tier 1 leverage		8.30	%		8.21	%		8.25	%		8.16	%		8.29	%
Common equity Tier 1		9.80	%		9.85	%		9.67	%		9.79	%		9.76	%
Tier 1 capital		9.80	%		9.85	%		9.67	%		9.79	%		9.76	%
Total capital		12.67	%		13.31	%		11.04	%		11.18	%		11.10	%

SmartBank³
Tier 1 leverage		9.71	%		9.59	%		8.88	%		8.76	%		8.94	%
Common equity Tier 1		11.51	%		11.56	%		10.41	%		10.51	%		10.51	%
Tier 1 capital		11.51	%		11.56	%		10.41	%		10.51	%		10.51	%
Total capital		12.32	%		12.37	%		11.25	%		11.35	%		11.30	%

¹Borrowers that have experienced financial difficulty. Effective as of December 31, 2025, the Call Report instructions were changed for institutions to report loan modifications to borrowers experiencing financial difficulty for a 12-month period after the modification. This change is reflected in the December 31, 2025, information.
²Total common equity less intangibles divided by total assets less intangibles. See reconciliation of Non-GAAP measures.
³ Current period capital ratios are estimated as of the date of this earnings release.

SmartFinancial, Inc. and Subsidiary
Condensed Consolidated Financial Information – (unaudited)
(dollars in thousands except share and per share data)

	As of and for The															As of and for The
	Three Months Ended															Year Ended
	Dec			Sep			Jun			Mar			Dec			Dec			Dec
	2025			2025			2025			2025			2024			2025			2024
Selected Performance Ratios (Annualized):
Return on average assets		0.95	%		0.96	%		0.88	%		0.87	%		0.75	%		0.91	%		0.73	%
Return on average shareholders’ equity		9.95	%		10.33	%		9.19	%		9.17	%		7.84	%		9.67	%		7.63	%
Return on average tangible common equity¹		12.06	%		12.79	%		11.53	%		11.60	%		9.99	%		12.01	%		9.82	%
Noninterest income / average assets		0.57	%		0.61	%		0.67	%		0.66	%		0.71	%		0.62	%		0.69	%
Noninterest expense / average assets		2.24	%		2.38	%		2.44	%		2.48	%		2.52	%		2.38	%		2.45	%
Efficiency ratio		60.91	%		66.32	%		66.14	%		68.96	%		68.98	%		65.45	%		70.49	%

Operating Selected Performance Ratios (Annualized):
Operating return on average assets¹		0.95	%		1.02	%		0.88	%		0.87	%		0.75	%		0.93	%		0.71	%
Operating PPNR return on average assets¹		1.44	%		1.29	%		1.25	%		1.12	%		1.13	%		1.28	%		0.99	%
Operating return on average shareholders’ equity¹		9.96	%		10.92	%		9.19	%		9.17	%		7.80	%		9.83	%		7.36	%
Operating return on average tangible common equity¹		12.07	%		13.53	%		11.53	%		11.60	%		9.94	%		12.20	%		9.48	%
Operating efficiency ratio¹		60.45	%		63.61	%		65.66	%		68.46	%		68.58	%		64.41	%		70.72	%
Operating noninterest income / average assets¹		0.57	%		0.59	%		0.67	%		0.66	%		0.70	%		0.62	%		0.66	%
Operating noninterest expense / average assets¹		2.24	%		2.29	%		2.44	%		2.48	%		2.52	%		2.36	%		2.45	%

Selected Interest Rates and Yields:
Yield on loans and leases, excluding loan fees, FTE		6.00	%		6.05	%		5.99	%		5.88	%		5.95	%		5.98	%		5.86	%
Yield on loans and leases, FTE		6.08	%		6.14	%		6.07	%		5.97	%		6.04	%		6.07	%		5.94	%
Yield on earning assets, FTE		5.65	%		5.68	%		5.65	%		5.56	%		5.64	%		5.64	%		5.54	%
Cost of interest-bearing deposits		2.79	%		2.98	%		2.95	%		2.92	%		3.02	%		2.91	%		3.15	%
Cost of total deposits		2.26	%		2.44	%		2.39	%		2.37	%		2.43	%		2.36	%		2.51	%
Cost of interest-bearing liabilities		2.90	%		3.07	%		2.99	%		2.97	%		3.08	%		2.98	%		3.22	%
Net interest margin, FTE		3.38	%		3.25	%		3.29	%		3.21	%		3.24	%		3.29	%		3.04	%

Per Common Share:
Net income, basic	$	0.82		$	0.82		$	0.70		$	0.67		$	0.58		$	3.00		$	2.16
Net income, diluted		0.81			0.81			0.69			0.67			0.57			2.98			2.14
Operating earnings, basic¹		0.82			0.86			0.70			0.67			0.57			3.05			2.08
Operating earnings, diluted¹		0.81			0.86			0.69			0.67			0.57			3.03			2.07
Book value per common share		32.44			31.62			30.51			29.73			29.04			32.44			29.04
Tangible book value per common share¹		26.85			26.00			24.42			23.61			22.85			26.85			22.85
Common shares outstanding		17,029,317			17,028,001			17,017,547			17,017,547			16,925,672			17,029,317			16,925,672

¹Non-GAAP measure. See reconciliation of Non-GAAP measures.

SmartFinancial, Inc. and Subsidiary
Condensed Consolidated Financial Information – (unaudited)
(dollars in thousands)
NON-GAAP RECONCILIATIONS

	Three Months Ended																				Year Ended
	Dec				Sep				Jun				Mar				Dec				Dec				Dec
	2025				2025				2025				2025				2024				2025				2024
Operating Earnings:
Net income (GAAP)	$	13,703			$	13,686			$	11,705			$	11,254			$	9,640			$	50,347			$	36,141
Noninterest income:
Securities losses (gains), net		—				3,715				4				—				(64	)			3,719				(64	)
Gain on sale of former branch building		—				—				—				—				—				—				(1,629	)
Gain on sale of SBKI		—				(3,955	)			—				—				—				(3,955	)			—
Noninterest expenses:
Restructuring expenses		16				1,310				—				—				—				1,326				—
Income taxes:
Income tax effect of adjustments		(4	)			(276	)			(1	)			—				17				(282	)			437
Operating earnings (Non-GAAP)	$	13,715			$	14,480			$	11,708			$	11,254			$	9,593			$	51,155			$	34,885
Operating earnings per common share (Non-GAAP):
Basic	$	0.82			$	0.86			$	0.70			$	0.67			$	0.57			$	3.05			$	2.08
Diluted		0.81				0.86				0.69				0.67				0.57				3.03				2.07

Operating Noninterest Income:
Noninterest income (GAAP)	$	8,219			$	8,637			$	8,898			$	8,597			$	9,030			$	34,352			$	34,152
Securities losses (gains), net		—				3,715				4				—				(64	)			3,719				(64	)
Gain on sale of former branch building		—				—				—				—				—				—				(1,629	)
Gain on sale of SBKI		—				(3,955	)			—				—				—				(3,955	)			—
Operating noninterest income (Non-GAAP)	$	8,219			$	8,397			$	8,902			$	8,597			$	8,966			$	34,116			$	32,459
Operating noninterest income (Non-GAAP)/average assets¹		0.57		%		0.59		%		0.67		%		0.66		%		0.70		%		0.62		%		0.66		%

Operating Noninterest Expense:
Noninterest expense (GAAP)	$	32,471			$	33,869			$	32,569			$	32,296			$	32,291			$	131,205			$	120,890
Restructuring expenses		(16	)			(1,310	)			—				—				—				(1,326	)			—
Operating noninterest expense (Non-GAAP)	$	32,455			$	32,559			$	32,569			$	32,296			$	32,291			$	129,879			$	120,890
Operating noninterest expense (Non-GAAP)/average assets²		2.24		%		2.29		%		2.44		%		2.48		%		2.52		%		2.36		%		2.45		%

Operating Pre-provision Net revenue (“PPNR”) Earnings:
Net interest income (GAAP)	$	45,094			$	42,430			$	40,343			$	38,238			$	37,783			$	166,104			$	137,350
Operating noninterest income (Non-GAAP)		8,219				8,397				8,902				8,597				8,966				34,116				32,459
Operating noninterest expense (Non-GAAP)		(32,455	)			(32,559	)			(32,569	)			(32,296	)			(32,291	)			(129,879	)			(120,890	)
Operating PPNR earnings (Non-GAAP)	$	20,858			$	18,268			$	16,676			$	14,539			$	14,458			$	70,341			$	48,919

Non-GAAP Return Ratios:
Operating return on average assets (Non-GAAP)³		0.95		%		1.02		%		0.88		%		0.87		%		0.75		%		0.93		%		0.71		%
Operating PPNR return on average assets (Non-GAAP)⁴		1.44		%		1.29		%		1.25		%		1.12		%		1.13		%		1.28		%		0.99		%
Return on average tangible common equity (Non-GAAP)⁵		12.06		%		12.79		%		11.53		%		11.60		%		9.99		%		12.01		%		9.82		%
Operating return on average shareholders’ equity (Non-GAAP)⁶		9.96		%		10.92		%		9.19		%		9.17		%		7.80		%		9.83		%		7.36		%
Operating return on average tangible common equity (Non-GAAP)⁷		12.07		%		13.53		%		11.53		%		11.60		%		9.94		%		12.20		%		9.48		%

Operating Efficiency Ratio:
Efficiency ratio (GAAP)		60.91		%		66.32		%		66.14		%		68.96		%		68.98		%		65.45		%		70.49		%
Adjustment for taxable equivalent yields		(0.43	)	%		(0.47	)	%		(0.47	)	%		(0.50	)	%		(0.49	)	%		(0.47	)	%		(0.46	)	%
Adjustment for securities gains (losses)		—		%		(4.50	)	%		(0.01	)	%		—		%		0.09		%		(1.19	)	%		0.03		%
Adjustment for sale of branch location		—		%		—		%		—		%		—		%		—		%		—		%		0.66		%
Adjustment for sale of SBKI		—		%		5.57		%		—		%		—		%		—		%		1.32		%		—		%
Adjustment for restructuring cost		(0.02	)	%		(3.31	)	%		—		%		—		%		—		%		(0.70	)	%		—		%
Operating efficiency ratio (Non-GAAP)		60.45		%		63.61		%		65.66		%		68.46		%		68.58		%		64.41		%		70.72		%

¹Operating noninterest income (Non-GAAP) is annualized and divided by average assets.
²Operating noninterest expense (Non-GAAP) is annualized and divided by average assets.
³Operating return on average assets (Non-GAAP) is the annualized operating earnings (Non-GAAP) divided by average assets.
⁴Operating PPNR return on average assets (Non-GAAP) is the annualized operating PPNR earnings (Non-GAAP) divided by average assets.
⁵Return on average tangible common equity (Non-GAAP) is the annualized net income divided by average tangible common equity (Non-GAAP).
⁶Operating return on average shareholders’ equity (Non-GAAP) is the annualized operating earnings (Non-GAAP) divided by average equity.
⁷Operating return on average tangible common equity (Non-GAAP) is the annualized operating earnings (Non-GAAP) divided by average tangible common equity (Non-GAAP).

SmartFinancial, Inc. and Subsidiary
Condensed Consolidated Financial Information – (unaudited)
(dollars in thousands)
NON-GAAP RECONCILIATIONS

	Three Months Ended
	Dec			Sep			Jun			Mar			Dec
	2025			2025			2025			2025			2024
Tangible Common Equity:
Shareholders’ equity (GAAP)	$	552,492		$	538,482		$	519,127		$	505,941		$	491,461
Less goodwill and other intangible assets		95,328			95,807			103,588			104,154			104,723
Tangible common equity (Non-GAAP)	$	457,164		$	442,675		$	415,539		$	401,787		$	386,738

Average Tangible Common Equity:
Average shareholders’ equity (GAAP)	$	546,489		$	525,829		$	511,067		$	497,980		$	489,172
Less average goodwill and other intangible assets		95,619			101,326			103,936			104,504			105,093
Average tangible common equity (Non-GAAP)	$	450,870		$	424,503		$	407,131		$	393,476		$	384,079

Tangible Book Value per Common Share:
Book value per common share (GAAP)	$	32.44		$	31.62		$	30.51		$	29.73		$	29.04
Adjustment due to goodwill and other intangible assets		(5.59	)		(5.63	)		(6.09	)		(6.12	)		(6.19	)
Tangible book value per common share (Non-GAAP)¹	$	26.85		$	26.00		$	24.42		$	23.61		$	22.85

Tangible Common Equity to Tangible Assets:
Total Assets (GAAP)	$	5,860,810		$	5,784,983		$	5,490,863		$	5,411,217		$	5,275,904
Less goodwill and other intangibles		95,328			95,807			103,588			104,154			104,723
Tangible Assets (Non-GAAP)	$	5,765,482		$	5,689,176		$	5,387,275		$	5,307,063		$	5,171,181
Tangible common equity to tangible assets (Non-GAAP)		7.93	%		7.78	%		7.71	%		7.57	%		7.48	%

¹Tangible book value per share (Non-GAAP) is computed by dividing total shareholders’ equity, less goodwill and other intangible assets, by common shares outstanding.

View source version on businesswire.com: https://www.businesswire.com/news/home/20260120705810/en/

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Billy Carroll

President & Chief Executive Officer

Email: [email protected]

Phone: (865) 868-0613

Nathan Strall

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Email: [email protected]

Phone: (865) 868-2604

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